Many times, certain things happen unexpectedly wrong. The place where we live burns so rapidly all in one go, there comes an earthquake, our car strikes into something, or we get bit out of sorts, there comes a possibility that we have to suffer such loses for which we have to pay heavily that even we can’t afford. Due to efforts of some people in the past years, we are now able to overcome those storms without being involved in any risk factor. We can help each other by spreading the risk among us as a group, and that’s what insurance does.
Let us first know what is insurance and how does it work?
What is insurance?
Insurance is a promise by the insurance companies that they would compensate for specific losses occurred by ill-fate i.e. any natural disaster, illness, death, fire etc.
If we buy an insurance policy it will reduce the rate of risk factor by being transferred from us to the company. In actual, the there is no complexity in Insurance. It’s a simple way to proceed. We have to pay a particular amount to as insurance company that is known as Premium. In case, if certain tragedy happens, that can be enveloped by policy words, either lost or damaged items can be repaired or replaced by our insurer or they pays wholesome amount of it.
Kind of insurance you need…
Everyone knows many kinds of insurance exist such as life, health, car, home etc but you do not need every kind of insurance. The exact type of insurance you need can be decided by your circumstances and your outlook. Before buying any insurance, you must mention following four questions directly;
- Explain the risk I would be insuring averse to?
It could be a sudden death factor, burning at home or car being stolen or being severely sick and under treatment.
- Mention the number of chances for it being occurred
There exist a small probability of fire at home but if it happens, you have to pay heavily for it. The risks of car being stolen are high but it won’t cost you as high as losing your home.
- What will happen if it occurs?
What happens if you die or your home gets fire or your car gets stolen? Will you be able to bear the expenses?
- How much would it cost?
May be you have enough balance saved to overcome the cost or maybe you surely want to use your balance for this.
Purchasing insurance from the providers of insurance will help you to buy around and compare quotes and cover. Maximum tasks for this are being done online. There are many different types of insurance covers and insurance policies. The insurance brokers and companies are always available for you help. They will explain how the policies work; they can find you one suited to your circumstances and even help in claiming. All these insurance companies, insurance brokers and financial advisors have to follow the protocol and get registered on the official government website Financial Service Providers Register (FSPR).
Here are the few tips that you must keep in mind when buying a policy.
- Read the policy carefully.
- Always choose the right excess.
- Have an emergency fund.
- Be honest and tell the truth.
- Shop around
- Don’t double up.
- Combine insurance.
- Look for a credible.
- Take precautions.
Right cover is the key
All the insurance policies are not same. They have different rules and regulations. It’s better to compare policies as the decision will become easier for you. Go for the right cover as two policies can have same price. For example, a trauma policy will only cover certain named diseases, not all illnesses or injuries. There are few cheaper house policies which cover specific events such as fire, theft etc. but not all risks.
Also, some policies will pay for the damaged or stolen items. Others may only pay ‘present value’. If you want to know all the details, go to Insurance Council website. All insurance policies have different conditions and exclusions. These exclusions are for unfavorable events that take place without your control.
The crux of this discussion is that read the policy carefully. Know the terms and conditions in detail. Clear your mind; otherwise you may be paying money for policy that will not help you when you need it the most.
In a perfect world, you would call an insurer and get fixed what is broken. But the world we live in is not perfect. Here, the process of claim is a little more complicated than that. There should not be any misunderstanding about the claim. Your claim will vary according to the type of insurance you need (home, life, health etc.).
The procedure for every insurance claim is quite same with a slight difference. Claims for home owners and car insurance require same basic steps.
- Step 1
Make the right phone call. No matter what kind of claim you are filling, get in touch with your insurer as soon as possible. The faster you get the ball rolling, the sooner you will receive the outcome.
- Step 2
Fill out the required forms. After you have contacted your insurer, they will send you few forms to fill. Many insurance companies give facility to fill online forms which makes process much smoother and quicker.
- Step 3
Get your damages assessed. Most insurance companies will ask you to get damages priced by an approved party to make sure that they are paying you a right amount.
- Step 4
Cover your deductible. You have to cover your deductible in full before insurance company will fork over its share of the total cost.
Make sure that you contact your insurer soon after the damage happens. The settler may choose to settle the claim by paying a sum of money. They may or may not repair or replace the items that have been damaged. In most policies, there is a value you have to pay as the first step of the claim. Be honest as insurance companies are wary of fraud and they will investigate if they have a slightest doubt of betrayal.
The amount of time it takes to settle a claim depends on different factors. It also depends on the severity and complexity of damage, how you quickly contact the insurer, how soon an adjuster is available, whether the company is handling multiple claims at once such as in case of natural disaster and so on. Considering all these factors, it is hard to tell the average time for claim settlement. The best thing you could do to settle claim in a timely fashion is to file as soon as possible and stay in constant contact with your insurer.