What are some basic things I should be aware of about insurance?
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Asked October 24, 2015
A well informed consumer is the best consumer, and insurance is no different. The more you know about the policy and insurance company you are dealing with, the better you will be able to choose the right policy and get the coverage that applies directly to you. This includes understanding what you are purchasing and how well the company you are buying from is positioned for your business.
Not all insurance policies are created equal. If you have specific needs, make sure they are addressed in the policy. This might include finding a homeowners policy that covers your guard dog, insured the pool, or whatever custom adjustments you need to match your interests. If you do not see the information you are looking for, or do not understand your policy, the insurance company will happily provide you with a full explanation of the policy, including any clauses, exclusions, or limitations.
Before you buy a policy, check the financial rating of the company you are considering. The A.M. Best Company provides a letter grade rating for both the current a long term expectations of insurance companies. Their data is updated regularly, and the best rule of thumb is to confine your insurance investments to companies that rated A++ or very close to it.
Most insurance policies have a period of time when you are allowed to make corrections to your application, followed by a period when the insurance company can terminate the policy if errors are made. Beyond that period, any mistakes in your application will become moot, and your policy will be a binding contract. You will also have a short window in which you can cancel the policy without incurring any cost, but the details of that will depend on the type of policy and several other factors.
Answered October 29, 2015 by Anonymous