The internet has has changed the way we purchase insurance forever. Customers are getting more and more clued up about their insurance.
These days, you can get insured for almost anything and the world wide web has created a highly transparent and competitive market place for insurer services. You are required by law to have certain insurance such as car insurance or medical insurance in some countries. Other insurance although not legally required is seen by most as a ‘must have’ such as insurance for your home and personal valuable property or insurance for a person’s business interests or property belonging to their business. Then there is a third class of insurance aimed with the needs of consumers in mind which is more specialised such as motorbike insurance, wedding insurance or Insurance for adventure holidays or extreme sports. On the high street or online, businesses tender different excesses and policy prices dependant on many different things. A secondary market also exists for the services of insurance brokers who shop around for products at the behest of their consumer or corporate clients. Another agency service in the insurance industry is underwriting.
Underwriting is basically where the risk to the insurer and other risks are calculated and the underwriter determines the premium and cost of the insurance or whether to insure at all. To take the example of auto insurance the underwriter would assess the drivers accident record. Another example might be medical insurance where the patients medical records are examined. The internet is certainly helping helps the insurance sector remain competitive and transparent but many customers are even now finding themselves without cover when they most need it. Winter sports insurance is an excellent example of this. It is reported that more than half of travelers to ski resorts are uninsured and although the other half do, only a quarter of them are actually covered for skiing and snowboarding which are classed by most insurers as ‘extreme sports’ and not included in their basic cover.
In the main, European travellers also think that their E111 is adequate to get them treatment but this is not true in most resorts. Another recent example of The adaptation of the insurance sector is the relentless price war between rival car insurance firms that has been largely facilitated by the introduction of price comparison sites. In this country, we are legally obliged to have car insurance so everyone must purchase it. This makes price the chief competitive factor. A recent example of a failure in the travel insurance market was when payment protection insurance policies (PPI’s) were uncovered by the FSA to be negligent drafted or having been fraudulently marketed. This has lead to a huge amount of litigation and firms being created for the single purpose of acting as legal assistants so that customers can claim back any PPI that might have been missold to them. Another questionable product is identity theft insurance that claims to reimburse the customer for losses on account of cyber fraud or identity theft. However many people are unaware that the bank is in most sets of circumstances liable for such acts.
This entry was posted on Friday, October 28th, 2011 at 3:46 am and is filed under General. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.