Insurance is one of the most important things you will buy as an adult, which is why it’s so important that you choose a good insurance company to it buy from. But how do you know you’re picking the right company for your unique needs? Keep reading to find out how to choose an insurance company that gives you exactly what you’re looking for.
How to Choose an Insurance Company? Things to Consider Before Taking out a Policy
There are tons of insurance companies around, from big ones to small ones, but just like many things, you shouldn’t simply choose the first one you see. Choosing a company should take a little longer than just typing the words ‘insurance companies’, clicking search, and accepting the first one that looks reputable. You must take some time to properly look for the right company. To help you get started, here are some key things to consider before making your choice.
How to Choose an Insurance Company: What to Look For?
Knowing whether a company is financially stable is one of the first things you have to look at. You don’t want an insurance company that’s going to fail in the future, which will result in you losing your policy.
Financially stable insurance companies can process all claims in a fair way. You don’t want to find yourself needing to claim, only to find your insurance provider can’t pay out. To avoid this unpleasant situation, get your hands on a copy of the company’s current financial statement. Assess their profitability as well as their growth rate for the past years. You can also use online resources and independent rating agencies to help you get this valuable information.
How Good Is the Customer Service?
Customer satisfaction should be high up on your list of what you need from an insurance company. Investigate how well the company treats its customers and how long they take to respond to questions and inquiries. Are they quick to solve customer issues or do they take a long time to process complaints?
When calling the company, what kind of service do you get? Do you have to deal with dreadful voicemail prompts, or are you swiftly connected to a live agent?
Accessibility is key, so make sure that you choose a company that puts its customers first. If you need to claim, you want to know that you can count on your insurance company to handle your claim as quickly and professionally as possible.
Read customer reviews (and not just the positive ones), ask friends and family what insurance providers they’re with and how their experience has been. Also check if there are any complaints laid against the company at your state insurance commissioner. Don’t forget to find out their claims-paying process as well – the easier the process, the smoother and more stress-free your experience will be.
What Do Premiums Cost?
Always ensure that the premiums are affordable and fair compared to the general market. Many people pay more than they should simply because they don’t shop around before buying insurance.
Simply doing your research could be a great way to save money on your insurance. Get quotes from as many different companies as you can, then compare them to find the one that gives you the coverage you want for the lowest price.
Keep in mind that a lower premium may not always be the best option. A lower premium usually means a higher deductible (the amount that you’re responsible for paying should you claim) and vice-versa. So you need to take this into consideration. A company that offers you a really low premium, might be trying to trick you into taking out a policy with an unaffordable deductible.
Find out if a company offer any discounts, such as lower premiums if you take out more than one policy with them (like both car and home insurance, for instance). It’s always nice to get discounts for being a loyal customer.
Are They Specialists?
Be sure that the company is a specialist in the coverage you need and offer you the products you need. For instance, if you want business insurance, look for a specialist in business insurance.
Did you know that not every insurance company is licensed to operate in every state? Because you can get insurance online nowadays, it’s vital that you buy only from a company that is licensed to sell its products in your state. This is essential so that you can be assisted by your state insurance department if a problem arises. Also check that the company is government-accredited, as well as recognized. You want to deal with a company that respects all the rules, guidelines, policies, and regulations.
Good insurance companies are completely open and honest to their customers, offering full disclosure on their policy terms and conditions. Don’t put yourself in a situation where you file a claim, only to be met with a whole lot of clauses and reasons as to why they can’t pay your claim.
Some of the responsibility does fall on you to ensure that before you sign anything, you take the time to fully read and understand the terms, conditions, and clauses of your insurance product to avoid any surprises later.
Now that you know how to choose an insurance company, let’s take a look at some key points to look at when buying car, home and life insurance.
Car Insurance Checklist
How Much Coverage Do You Need?
First, decide exactly how much coverage you will need by looking at your situation. Also, each state has specific car insurance requirements that you must abide by, so research what insurance you’re mandated to get by your state and make sure you get it.
Have a Look at Your Driving Record
Make sure there are no outstanding tickets or points on your driver’s license before you start requesting quotes. A bad driving record instantly drives up your premiums.
Ask About Discounts
A good driving record, your car’s safety, as well as things like security equipment will get you discounts on your insurance. Make sure the company you choose offers you the discounts you qualify for.
Home Insurance Checklist
Know What Your Policy Will Cover
Every policy is different, so you must be certain that you know what will be covered and what won’t to avoid complications. Check that you fully understand what cover you’re getting. If you live in an area that’s known for flooding, look for a company that can give you this cover, even if you have to add a rider to your policy.
Speak to an Expert
To help you fast track your home insurance search, try speaking to an expert in home insurance. They can advise you on how to save on costs without having to drastically reduce your cover.
Know Your Home’s Information
Be sure you know some specific information about your home. Get to know things like your home’s replacement cost (how much it will cost to rebuild), how many stories it has, its square footage, the year it was built, its fire safety information, the exterior wall type and even the last date of property claim.
All this information can have an impact on your premiums. Many major companies simply use your address and automatically estimate what kind of home you have. Double-checking that this information is correct might be an easy way to save on your premiums a bit.
Know Which Type You Need
There are two main life insurance types – term life insurance and permanent life insurance.
Term insurance policies only last for a specific time, usually 20 or 30 years. If you don’t claim in this time, all your benefits will expire. Permanent life insurance never expires and you’re always eligible to claim.
There are pros and cons for both, so take the time to assess your personal needs, such as your affordability, before choosing which policy to take. Also look out for a conversion feature, which simply allows you to convert your term policy into a permanent policy, should you ever want to.
Some companies now offer benefits while you’re still living. These include receiving payments after being diagnosed with a chronic illness or getting some, or all, of your premium paid back to you. Be smart and pick a company that can give you these benefits.
Look for the best rates for your circumstances. Each company has its own way of pricing risks like smoking, diabetes, and your family’s medical history, so find a company that treats your health and personal activities fairly.
Your Hard Work Will Pay Off
Choosing an insurance company isn’t a quick thing to do (nor is it fun, to be honest). But if you do your homework right, you won’t regret the time you put in.
Remember, it’s not only about finding a company that can offer you the lowest price, but it’s also about the quality of the service and how high the customer satisfaction rating is. When considering how to choose an insurance company, don’t simply shop based on price. Be an informed consumer, ask the right questions and get the best policy for your needs.