15 Aug

All Insurance Companies are not Created Equal

When it comes to insurance companies, not all are created equal. You pay hard-earned money for your insurance to protect your family and your investments, so you need to make sure that your insurance provider is reputable and will deliver on what they promise.

If you are shopping around with different insurance companies, you may be tempted to go for the best deal. It doesn’t hurt to look for a good deal, but it’s also important to make sure the deal is not too good to be true and the company can back up its claims.

There is a whole list of things you should look at before choosing from insurance companies out there to make sure you pick the best one for your needs.

Firstly, check to see if your state government has any information about insurance companies and rates. This can give you a good baseline of what insurance companies are out there and what they are charging. You may also be able to get an idea of which companies are more reputable in your state.

Independent insurance agents, brokers and online services are a great way to get rates from various insurers through a relatively objective third party. You might also be able to get a better deal through these services because most of them will offer insurance through several different insurance companies that will allow you to pick the best rate.

Ensure that your insurance companies are properly licensed and covered by your state’s guaranty fund. The latter is super important because this fund will pay for your claim if your insurance company is in default for some reason. You can get this information from the insurance department at your state government’s office.

With defaulting in mind, you should also check into the financial stability of insurance companies that you are considering. You can research this online through ratings from various companies like A.M. Best, Standard and Poors and Moody’s Investor Services. If your find a company to be on shaky financial ground, it’s probably best you don’t choose it as your insurer – no matter what great rate deal it offers.

Complaints about insurance companies are never a good thing and are a sign to be wary when choosing them as your provider. You can research the complaint history of any insurance company through your state’s insurance department or online at the National Association of Insurance Commissioners, which maintains a database of insurance complaints filed with state regulators.

Another great way to investigate insurance companies is to see what other customers are saying about them. Search online for reviews and feedback on companies to see what people thing about them. Check out InsuranceUSA for reviews of many insurance companies. Customer service should be a major thing you check for when looking at reviews, as it is often the main service you get from an insurer.

After you pay your first insurance premium, make sure you receive a hard copy of your insurance policy in the mail in the form of a written document that you have to sign. Getting this means that your insurance agent has sent your payment to the company and you are, indeed, insured. If you don’t see one of these within two months of sending your payment, get in touch with your agent or insurance company as soon as possible.

If you do sign up with a company and it seems all is not quite right, you may find yourself the victim of insurance fraud. Insurance fraud can come in many forms, such as fake policies from companies that aren’t licensed to do business; premium fraud happens when agents and brokers keep your money instead of sending it to the insurance company; selling of unnecessary services; scams and more. You can report insurance companies you suspect of insurance fraud to the National Insurance Crime Bureau hotline by dialing 1-800-835-6422.

All that glitters is not gold. So if you are offered a rate on an insurance policy that seems too good to be true, it just might be. You may be dealing with an insurance company that’s not properly licensed, is in poor financial shape or has a history of poor customer service or denying claims. All insurance companies are not created equal, so be sure to do your homework before signing on to any policies.


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