Know your insurance needs
Be clear which risks you are exposed to and which needs can be satisfied by insurance. A good insurance broker or agent is able to help you determine these, narrow down the most critical and arrange cover for them. Remember, it beats economic sense to insure every risk you are exposed to as insurance comes at a price. Only insure against events whose financial impact would be too high for you to manage on your own. For instance, it is unnecessary to insure against high limits for medical outpatient cover when all you are subject to is the odd cold or two per year. On the other hand it is critical to have a policy to cover your potential inpatient bills which can rise quite fast in an emergency. Knowing your needs will also help you to counter over selling by aggressive agents.
Plan for risks which cannot be insured
Sadly, there are many risks for which insurance is not available. This could be because the cost of the risk would be too high for an insurer to carry or it happens so frequently that it is certain to occur. In such cases, the insurance premium would be almost as high as the losses that it is known will definitely occur! The insurance company is in business to make a profit for its shareholders after all. This is why you cannot buy a new health insurance policy once you are above 65 years of age when your medical needs are likely to have increased. You need to have bought the cover and kept your policy in force much earlier to allow the insurance company time to collect premiums from you over the years and invest them to help them absorb the shock of the cost of your higher medical expenses in your old age. Makes sense doesn't it?
Choose your insurance company
There are many companies in the insurance market. Some are large international corporates while others are smaller, more relaxed and friendlier companies next door. You need to select the company that is the best fit for you in terms of the insurance protection you need, the kind of customer service you expect and at times the nature of your own personality. Some would like an insurer where they can drop in for a chat and cup of tea as they have their insurance sorted. Again, your insurance broker should be able to match you with a company that you would be most happy with.
Always give complete and truthful answers to the best of your knowledge to your insurance company whether directly or through an intermediary. Insurance is governed by the principle of Utmost Good Faith that requires that anything that a reasonable person would consider important for an insurer to know must be disclosed. This applies when completing the proposal form at the start and ends with complete disclosure when completing a claim form in the event of a loss. So important is this principle that the insurer has the right to refuse payment of a claim or go as far as prosecution for fraud if the failure to state the truth leads to wrongful payment.
Keep abreast of your rights
It makes sense that you become aware of your rights under the insurance contract; after all be sure that your insurer is on top of their game as to what they cover and what they do not. You have the right to have the insurance contract explained to you by your intermediary in a manner that you can understand. You have a right to receive a receipt of payment and the policy document. The policy document as this is the evidence of your agreement with the insurance company and details your responsibilities in the contract as well as outlines the circumstances in which the insure has agreed to pay. Read it and ask for clarification for any terms that are not clear to you or are not what you intended or correction of anything that you find wrong in the document as soon as possible on receiving the policy document. Read all endorsements that you receive from the insurer as these could make fundamental changes to your policy.
Know the complaints channels open to you. Local associations for insurance companies and intermediaries and ultimately the Insurance Regulatory Authority are helpful in solving disputes. Following the correct complaints protocol improves your chances of success in your quest. Most policies allow for arbitration before recourse to legal proceedings in the event of a dispute.
Pay your insurance premiums promptly
Ensure that your premiums are paid when due and obtain a receipt for them. When insurance is sold on cash and carry basis, your premiums must be received by the insurer before cover starts. If you are unable to pay the premium in full, an option available to you is insurance premium finance from a bank.
Keep good records
Maintain good records of all documentation regarding your insurance. File your insurance policy document and all endorsements that you receive when changes are made to the policy or it is renewed. Safely file original copies of all receipts for purchase of items you have insured as well as your medical bills and receipts as insurance companies will only pay when presented with original documents. If you are a large organization, ensure to keep staff and wage roll as well as production and sale records well.
Report all incidents that may lead to a claim on time
Report any incident that you think may lead to a claim under your policy immediately and definitely within 30 days of occurrence. This is to allow the insurance company a chance to gather supporting evidence on the incident while the event is still fresh. Any longer time is a disadvantage as the memory of witnesses fade and evidence is lost.
Remember not to take any action that can be considered an admission of liability as this lessens the insurance company’s bargaining power with the other party involved. Do not under any circumstance negotiate with a third party yourself; your insurer is best placed to do this.
Co-operate with your insurance company in all matters as they try to have your claim resolved. Attend court when due and provide all the necessary claim documentation.