Purchasing insurance is the best way to manage risks. Whether you’re in business, looking to take a mortgage or protect your family in the event of a death, it’s important to buy insurance.
Insurance grants your peace of mind as you can shift the cost of a potential loss to the insurer. It provides you with a safety net in the event of a crisis and ensures business and family stability. If you want to take out a mortgage and you have less than 20% down payment, lenders will require that you purchase insurance to get approved.
Buying insurance is a significant financial decision, and you’ll want to give it the seriousness it deserves. A lot of people have lost millions of dollars in the past due to dealing with unscrupulous insurance companies. Moreover, with the thousands of insurance companies out there, choosing the right insurer you can trust with your money can be a challenge.
Let’s look at the key factors to consider when choosing an insurance company.
Shop around
Do not just settle for the first insurance company you come across. This is one of the mistakes that first-time insurance buyers make. Ensure you shop around and compare many companies and choose the best one. It’s a good idea to work with an insurance broker as you shop around. They will help you understand the specific things to consider when comparing insurers.
Reputation
An insurance company’s history speaks volumes. Be sure to look at things like their financial strength, the period they have been in business, the type of insurance products they sell, customer reviews, and company leadership. You don’t want to invest your money in an insurance company that takes too long to pay claims due to poor financial results.
Do They Offer Discounts?
Some insurance companies offer discounts such as defensive driver discounts, good students, newer homes, multi-family cars, and many more. Ask your potential insurer if they offer any discounts to gauge how much you could save. However, this shouldn’t be the only factor to consider when choosing an insurance company. Some insurers may use discounts as bait, so it’s best to consider their overall reputation as well.
Full Disclosure
There are many insurance companies out there that fail to disclose all terms and conditions until you file a claim. A reliable insurer should be honest about its terms and conditions to avoid surprises down the road. You should also read the terms of the contract inside out before appending your signature. It’s also advisable to have your lawyer ready the contract before you sign it.
Customer Service
You don’t want to invest your money in an insurance company that doesn’t care about its customers. Look at how they respond to customer’s questions and inquiries, how they handle claims, and generally if they are customer service oriented. Check the customer reviews section to get an idea of what previous customers are saying about their services.
While insurance is something most people overlook, it can protect what matters most to you.
