Not all Insurers are created equal – are you at risk?


Not all Insurers are created equal:

It’s my goal to help educate consumers about one of the hazards of using a comparison tool (although I am a fan of the new technology).  Before this great technology, it was a broker or agents job to secure your insurance. The broker was also at risk if the company they advised you to buy insurance from would go bankrupt.  Actually that was one of the agent/broker’s largest risks – Errors and Omissions claim.  I think the benefits of online tools have the potential to be greater than the risks, for those who are very informed.

 

Will using online comparison tools push the credit risk on the consumer?

We should also note here that insurance is protected and backed by state insurance Guarantee funds in the event that a company defaults or becomes insolvent.  So it is important to understand the solvency of your state fund as well.  But rest assured there is still a second layer of protection but failure to procure the appropriate coverage doesn’t have a layer of protection.

 

Online tools

Now with the power of online comparison tools you have to make the decision between insurance companies A or B with little or no guidance other than price.  This will hopefully evolve or an agent or customer service representative will guide consumers through the process.

Terms, financial strength, claims paying ability, customer service, etc. will all be determined by your online aggregation tool.

Rather than listing and regularly updating the companies that support the various comparison platforms we will just use the links to a few examples.

zebra
The Zebra

Now the choice will be up to you. But if you had a bad experience with an insurance company previously, on an issue other than feeling you paid too high of a price – the pain you experienced might be worth additional consultation/research.

 

Reviews/Research

We created a repository for reviewing your insurance company on this site.  We encourage brokers, agents, and industry experts to participate.   The more information shared between our network the better informed consumers will become.

One of the tools to use to determine the financial strength of your insurance company is AM Best:

• How to research your insurance companies:
http://www3.ambest.com/ratings/entities/Search.aspx

 

• This is the methodology for understanding AM Best Financial Strength ratings. http://www.ambest.com/ratings/ubcr.pdf

 

• What the ratings actually mean?

http://www.ambest.com/ratings/guide.pdf

 

Thoughts:

Keep in mind these companies will also be commoditizing insurance and essentially driving the price to the lowest provider of risk coverage.  Future focus should be on best in class claims, service, financial strength, etc.

That’s where InsuranceShark aims to help.

Your empowerment is our goal.

With more information about insurance the better you will be at making decisions. In our investor relations section, we will cover analysis of some of the companies on the list, as well as comment or contact us with questions.

For the “Do It Yourself” crowd, please see some of the tools above and on our site.

Happy hunting and Contact Us if you need help.

 

Related Articles:

 

Comments

comments

Enjoy this site? Please LIKE, follow or share!!