How to Choose Insurance

Everyone needs it: Auto Insurance, Home Insurance, Life Insurance and Long Term Care Insurance, Flood Insurance, Business Insurance, Business Continuity Protection, Professional Liability Insurance, Mortgage Insurance and probably many more could be listed. Here's a common sense primer:

Difficulty: Moderately Easy

Instructions

Things You'll Need:

• Internet Access

1. Determine exactly what you need or want insured. Is it your business assets, your client records and vital information or just your building; is it your home or the replacement value of the home and its’ contents in today’s market.

2. Determine what e minimum amount of insurance you need is. That information may come from your mortgage company or the bank that is financing your business or car loan. If you are looking into life insurance that may be determined by the lifestyle you lead and how you would like your family to live if you unexpectedly passed away. Are you worried about the rising cost of health care and want to be sure you can live in your home as long as possible with adequate nursing care or the escalating cost of nursing homes? Then create a list of items you would like to include in the insurance if possible depending upon the cost.

3. Go to the websites of nationally known and rated insurance companies and request a rate quote. Insurance companies are rated, with letter code, such as ‘A Rated’ or ‘AA Rated’ or ‘B Rated’; the rating is based on their financial strength. An ‘A’ rating is better than a ‘B’ rating. Make sure to provide the exact same information to each one, so that the quote that you get gives you a quote for the same amount and type of insurance. You can look up the rating of the insurance companies through AM Best Company, which provides the ratings.

4. Ask yourself, does service matter to you, when you file a claim? If you decide to choose the insurance company that gives you the lowest price, how good are they when it is time to handle a claim.

5. Make a call to the customer service number that is provided on an insurance companies website. If you feel you are on hold for a long time, that could be an indication that they don’t have enough staff to handle incoming customer service calls.

6. Investigate with your state department of insurance whether an agent has any claims from dissatisfied clients registered against them. Insurance agents have to be licensed and claims from dissatisfied clients registered are kept on file and reviewed when the insurance agent has to renew their license.

7. To make sure you are talking with a licensed agent, ask for their license number. Legitimate insurance companies have licensed agents and abide by regulations mandated by their state department of insurance Be concerned if someone says he is providing insurance but does not have to be ‘licensed’ to sell this ‘type of coverage’.

8. Ask people you know and trust who they use. Call your church or synagogue. Find out if there is a member who is an agent/broker of the insurance that you need. They will be very appreciative that you are willing to consider someone within your own community. Remember also, they will be seeing you from time to time as well.

Tips & Warnings

• The burden of making good buying decisions is always on the consumer. With any important decision, make sure you are comfortable with the person you are dealing with and trust them.
• If you feel pressured into buying, maybe you shouldn’t be buying from them.
• If someone offers you 'coverage' but doesn't call it 'insurance'; maybe it isn't. There are 'alternatives to insurance' that sales representatives offer to people who have been rejected by traditional insurance companies.

Resources

• Florida Department of Financial Services

[kp3028]

on 9/10/2009 Making sure you are considering an excellently rated company is very important.

[knickar]

on 7/28/2009 Great Article!

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[Smireles]

on 3/6/2009 Good article. 5*