Insurance companies are in place to protect ones property, family and to help with out-of-pocket costs for health care. Therefore, it is important to choose a company that can and will fulfill their obligation to their policy holder. The type of insurance chosen may vary depending on the life situation. For instance, if you are single your needs are much different than someone just starting a family. A young family just starting out may want insurance that will cover college tuition for their infant. Someone with an established family may want an insurance policy that will guarantee their adult children and spouse is taken care of in case of an emergency. A retiree or empty nester may have different needs and requirements. No matter what stage of life, there are several things to look for when choosing the right insurance company.
Insurance companies range in size from the large multimillion dollar companies that have been around for a long time, to the midsize and smaller companies that may be building their reputation. Whether you are considering a large, medium or small insurance company, it is important to check if they have a history of meeting their obligations. All insurance companies are required by law to maintain large reserves that guarantee they can meet the obligations of their customers. This is called actuarial reserves and is required to offset assets to pay off any future liabilities. Every state sets a minimum amount that the insurance companies must have in their reserves. Make sure that the company is insured and that it meets the state’s standards.
Decide if you want to work with an independent or captive agent. The independent agent has the ability to work with several different insurance companies and generally have their own home office. The captive agent works solely for one company. Whether you choose to work with an independent or captive agent, it is important to have a good working relationship.
When making your decision on which company will fulfill your needs, compare benefits. Make a list of your needs and find out if the insurance company can meet those requirements. Check what the costs will be and if they comfortably fit into your budget. Check the cost of the deductible, what the out of pocket limit will be and what will be your co-pay. Find out how much the insurance company will cover in case of an accident and if it fits your needs.
Another factor to consider when choosing the best insurance company is to check the company’s rating. There are several private companies that do financial analysis on insurance companies that you can check online or at your local library. Make certain the company’s rating meet your standards. Not all insurance companies use the same rating system so it is important to keep that in mind when checking ratings.
Lastly, find out if any complaints have been lodged against the company. Any complaints that have been filed against them can be found at the National Association of Insurance Commissioner’s database.