Here are some of the best kept secrets of insurance companies, the knowledge of which will help you get a better price when shopping for insurance or filing an insurance claim:
1. It’s more of a business and less of a customer service: One of the best kept insurance companies’ secrets is that at the end of the day, they mean business. The insurance companies are not always concerned with your best interest, but operate with the intention of making a profit and improving their bottom line. Selling an insurance policy with a higher premium gives higher commission to insurance agents — this is one of the most common tricks of insurance agents. They do not explain the limitations or exclusions that are mentioned in fine print.
2. Credit history plays an important role in your premium quotes: The way an insurance agent may trick you is by increasing the policy premium or adding exclusions. What the insurer won’t tell you is that they are charging a high premium on your policy due to your poor credit history. Also, the insurer won’t tell you that the premium can be lowered if there is an improvement in credit history. You will continue to pay high premiums for years, long after your credit history has improved. This provides huge profits for insurance companies.
3. Claims adjusters can make or break the deal for you: Another example of insurance agent tricks is to convince customers to buy high coverage. What the insurer won’t tell you is that the claims adjusters are instructed to settle the claim as soon as they realize that the claim proceeds may continue to increase. This is one of the most important health insurance tips and also one of the best kept auto insurance secrets. In a health insurance claim or an auto claim where there is a bodily injury, the chances are that the medical treatment cost may increase as long as the claim is kept open. So, the claims adjusters try to settle the claim for a lump sum. This saves an enormous amount of money for the company.
4. You are forced to take unwanted coverage: An insurance agent may trick customers into adding extra coverage for a few dollars of extra premium. Most of the extra coverage comes with a lot of exclusions. Extra coverage has loopholes through which the insurance company can escape payment. Unless one really understands the requirement, one should not fall prey to these insurance agent tricks.
5. There is room for negotiation: Often, an insurance agent tricks a customer into believing that he or she is offering you the best rate for an insurance plan. What insurers don’t tell you is that there is always room for negotiation. If you negotiate or bargain, they may throw in additional coverage or reduce the premium by a few dollars.
Keep these insurance companies’ secrets in mind and bargain for a better price on your insurance.
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