Insurance Quotes and Rates for 2009

by Adam Alter

The insurance industry is reporting that insurance premiums across the board have increased an average of 6% entering 2009. Studies show the main factors that increases premiums are claims and business costs, but inflation plays its part as well.

For example, in the health insurance sector two major issues are driving costs up. One is that people living unhealthy lives and having more claims. The second is that the cost of health care is rising due to sue happy consumers. All we typically hear about in the news is the patient that was screwed over or mistreated. At the same time, even though it's not as news worthy, there are lots of frivolous and ridiculous lawsuits of people wanting to blame their doctor for their problems.

As expected, this is causing many to look for discount plans from the self-employed to the corporate groups small and large.

To continue using the health care industry as an example, the health insurance companies are trying to keep their insurance quotes competitive. These insurance companies are fighting back and attempting to direct consumers down a healthier path. By offering better coverage on routine checkups and recommended test procedures for conditions by age and high risk categories, they can increase early diagnosis which can often decrease the degree of treatment required. This saves money for everyone as well as pain and even potential deaths of the consumers.

To some it may sound extreme that they must push us for regular checkups and to think twice about everything we do in our lives as to whether or not it's considered "healthy". However, this is all they're left with in order to continue being able to stay in business and consumers be able to continue paying for their insurance. What this presents to those comparing insurance quotes to find the best rates and coverage is more fine print and policy details to take into account. Be more responsible in finding the right plan rather than jumping into a policy that leaves you uncovered when you need it most.

Some people in all sectors are opting for policies with very high deductibles to just cover an extreme case that could bury them financially. They're paying out of pocket for their needs such as with small auto repairs, or health checkups and if there's an emergency they're covered. This makes people be more responsible for their lives rather than paying an insurance company and milking everything they can from it. The advise when going this route is to go with the highest deductible you could possibly afford with home insurance, auto insurance, health insurance, and the many insurance types under and between those main categories.

Other than raising deductibles and reducing claims, the best way for the consumer to save the most amount of money is to compare their rates regularly with what is out there available. Websites like http://www.usinsuranceonline.com/ have free services that will pull insurance quotes from multiple providers allowing quick and easy comparisons of rates and coverage. There's no obligation and no spam attached to filling out a profile.

source : GoArticles.com

Tips for Saving Money on The Insurance Premium

by Franchis Adam

In many countries getting a driving license and that too in just a single attempt is a big deal. There are people who celebrate if they get their driving license in their teenage. The reason why Driving licenses are so important is that without driving license one is not legally allowed to drive a vehicle.

Apart from the driving license there is another requirement which one has to fulfill before driving a vehicle and that is auto insurance. Auto insurance is a vital part of the legal requirement which one has to fulfill in any condition and if anyone found guilty in this regard then he will be punished. The punishment could be fine or few months' imprisonment or both.

Another than the legal requirement there are many benefits of auto insurance like medical cover for the owner, car repairs etc. But the reason why people ignore the insurances and don't feel the need of these policies is the cost of the insurance. Most of the people think that they will never use these insurance as they are the safe drivers but they do not think about the uncertainties that can happen to them. This is why govt. put a bar that every car owner has to sign up an insurance policy for their vehicle.

If one is worried of the cost of the insurance policy then it doesn't mean that he should ignore the need of insurance. There are ways in which one can cut over the cost of the insurance policies and this will help them to get a car insurance policy for their children.

Here are few tips through which one can lower down the car insurance expenditure.

1. In every car company there is a provision in which the customers get the chances of paying a lower premium. This is kind a facility for the car users and they can avail this only in one condition by driving safely. A spotless driving record can award them with a kind of special discount which could be more than 50% amount of the total premium. Avoiding all the traffic rules violation also helps in it.

2. Avoid those cars which fall under the higher risk category. There is a wide range of cars available in the market which has upgraded and advanced safety measures. Also if one owns a car which falls under the risk category then he can install the safety kit in their car, which is easily available in the market.

source : GoArticles.com

Principles of Insurance

Commercially insurable risks typically share seven common characteristics.^[1]

1. A large number of homogeneous exposure units. The vast majority of insurance policies are provided for individual members of very large classes. Automobile insurance, for example, covered about 175 million automobiles in the United States in 2004.^[2] The existence of a large number of homogeneous exposure units allows insurers to benefit from the so-called “law of large numbers,” which in effect states that as the number of exposure units increases, the actual results are increasingly likely to become close to expected results. There are exceptions to this criterion. Lloyd's of London is famous for insuring the life or health of actors, actresses and sports figures. Satellite Launch insurance covers events that are infrequent. Large commercial property policies may insure exceptional properties for which there are no ‘homogeneous’ exposure units. Despite failing on this criterion, many exposures like these are generally considered to be insurable.
2. Definite Loss. The event that gives rise to the loss that is subject to insurance should, at least in principle, take place at a known time, in a known place, and from a known cause. The classic example is death of an insured person on a life insurance policy. Fire, automobile accidents, and worker injuries may all easily meet this criterion. Other types of losses may only be definite in theory. Occupational disease, for instance, may involve prolonged exposure to injurious conditions where no specific time, place or cause is identifiable. Ideally, the time, place and cause of a loss should be clear enough that a reasonable person, with sufficient information, could objectively verify all three elements.
3. Accidental Loss. The event that constitutes the trigger of a claim should be fortuitous, or at least outside the control of the beneficiary of the insurance. The loss should be ‘pure,’ in the sense that it results from an event for which there is only the opportunity for cost. Events that contain speculative elements, such as ordinary business risks, are generally not considered insurable.
4. Large Loss. The size of the loss must be meaningful from the perspective of the insured. Insurance premiums need to cover both the expected cost of losses, plus the cost of issuing and administering the policy, adjusting losses, and supplying the capital needed to reasonably assure that the insurer will be able to pay claims. For small losses these latter costs may be several times the size of the expected cost of losses. There is little point in paying such costs unless the protection offered has real value to a buyer.
5. Affordable Premium. If the likelihood of an insured event is so high, or the cost of the event so large, that the resulting premium is large relative to the amount of protection offered, it is not likely that anyone will buy insurance, even if on offer. Further, as the accounting profession formally recognizes in financial accounting standards, the premium cannot be so large that there is not a reasonable chance of a significant loss to the insurer. If there is no such chance of loss, the transaction may have the form of insurance, but not the substance. (See the U.S. Financial Accounting Standards Board standard number 113)
6. Calculable Loss. There are two elements that must be at least estimable, if not formally calculable: the probability of loss, and the attendant cost. Probability of loss is generally an empirical exercise, while cost has more to do with the ability of a reasonable person in possession of a copy of the insurance policy and a proof of loss associated with a claim presented under that policy to make a reasonably definite and objective evaluation of the amount of the loss recoverable as a result of the claim.
7. Limited risk of catastrophically large losses. The essential risk is often aggregation. If the same event can cause losses to numerous policyholders of the same insurer, the ability of that insurer to issue policies becomes constrained, not by factors surrounding the individual characteristics of a given policyholder, but by the factors surrounding the sum of all policyholders so exposed. Typically, insurers prefer to limit their exposure to a loss from a single event to some small portion of their capital base, on the order of 5 percent. Where the loss can be aggregated, or an individual policy could produce exceptionally large claims, the capital constraint will restrict an insurer's appetite for additional policyholders. The classic example is earthquake insurance, where the ability of an underwriter to issue a new policy depends on the number and size of the policies that it has already underwritten. Wind insurance in hurricane zones, particularly along coast lines, is another example of this phenomenon. In extreme cases, the aggregation can affect the entire industry, since the combined capital of insurers and reinsurers can be small compared to the needs of potential policyholders in areas exposed to aggregation risk. In commercial fire insurance it is possible to find single properties whose total exposed value is well in excess of any individual insurer’s capital constraint. Such properties are generally shared among several insurers, or are insured by a single insurer who syndicates the risk into the reinsurance market.