One of the major worries for most people is whether their investment in a private insurance company is safe. The other main issue has been the problem of handling policies when termination occurs before maturity. Most people fail to understand the clause on premium payment and maturity and when not able to complete a cover to maturity they get into problems with the insurance companies.
Another major worry is making claims and how timely this should be. If you are looking for an insurance company you can trust, Ieuter Insurance Group is your perfect partner. Having been in the private insurance industry for seventy-five years, you can trust us with this crucial move.
Below we look at 3 key reasons why can trust private insurance companies;
Strict Regulation
In the United States, each state has a body that regulates the sector. In Michigan, the Department of Insurance and Financial Services (DFIS) is charged with that mandate. Besides regulation, the department handles various other issues Among these are insurance fraud, licensing, and information dissemination. This means that before a private insurance company ventures into the market, certain requirements must be fulfilled.
Insurance regulation entails:
- Rules, regulations, and directives must be followed to the letter by all insurance companies.
- Close monitoring
- Oversight
Another key reason for regulation is the fact that most consumers do not have adequate knowledge. This is complicated by the insurance language which is riddled with jargon. Regulation ensures the consumer is protected and receives adequate compensation as long they have a valid case. Regulations also ensure that consumers enjoy reasonable rates.
The body also ensures that insurance products and policies are standardized. It also controls the conduct of the various companies in a bid to prevent unfair trade practices. This means at no point will a private insurance company deviate from the standard practices and have its own rules and regulations. These may be independent insurance companies but they are strictly monitored by the regulating body for any malpractices.
Reinsurance
Reinsurance simply means that an insurance company insures itself from the risk of a major claim which it may not be able to pay. Each private insurance company is reinsured. This is a mandatory requirement. In case your insurer is not able to pay, the re-insuring company takes up the liability. This happens when the claim is very large and the insurance can’t pay.
The ceding company which is the company purchasing insurance remains solvent even after a major claim. Solvency simply means, the insurance company can meet its long-term fixed expenses even after a major claim since this is handled by the reinsurer. This is the company issuing the reinsurance policy. This reassures you that you can trust private insurance companies since they have another company to take liability in case they are not able to handle your claim.
Dispute Resolution
The reality is that insurance is a business like any other and is premised on trust. However, there exists a conflict of interest between the insurance company and the policyholders. The insurance company is out there to make a profit while the policyholder also expects their claims to be paid. This calls for the need for a regulator who mainly safeguards the policy holder’s interest. Without regulations, mismanagement could also cause insolvency in private insurance companies. This conflict is the raises the need for dispute resolution.
Regulatory bodies do not only solve disputes, they also investigate and prosecute in case there’s insurance fraud. This is the more reason you should trust private insurance companies in that there’s a body willing to listen to you in case you are having issues with your insurer. One of the main mandates of the regulatory body is to also endure the insurance claim is settled promptly. This could make a huge difference in case you need medical attention in the case of an accident.
Some of the fraudulent activities investigated by the insurance bodies that you should be aware of include:
- Failure by insurance to pay even when the claim is genuine
- Misrepresentation of insurance by insurance agents
- Embezzlement of premiums, where insurance agents do not submit premiums submitted through them to the company.
With the above, you can engage private insurance companies with the knowledge that they are strictly regulated. Whether you are looking for auto insurance, business, life, health, or specialty insurance, we have you covered. We are a one-stop-shop for most of your insurance needs with experienced professionals ready to take up your insurance needs. Visit us at Ieuter Insurance Group for more information on our products.
