What The Insurance Companies Aren T Telling You About Your Premium

What The Insurance Companies Aren T Telling You About Your Premium



What the​ insurance companies arent telling you​ about your premium
Although insurance companies offer peace of​ mind to​ the​ policy holders,​ it​ is​ important for all customers to​ remember that they are for profit companies,​ and accordingly your own personal interest is​ not their number one priority. Consequently,​ any insurance company will capitalize on​ every opportunity to​ extract money from its customers. the​ primary source of​ income for an insurance company is​ the​ premiums which it​ levies from its customers.
The premium is​ the​ fee which keeps the​ insurance policy alive. Each company collects the​ premium on​ a​ regular basis. the​ policy holder is​ expected to​ pay the​ premium on​ time. Delayed payments may lead to​ consequences such a​ fine or​ even termination of​ the​ policy. if​ a​ lapse in​ your payments does take place,​ this will render the​ earlier premiums paid by the​ policy holder useless. So,​ in​ order to​ reinstate oneself,​ the​ policy holder might even have to​ renew the​ entire policy.
There has also been a​ recent trend of​ policies being sold at​ inflated prices by a​ few agencies. Some of​ these companies that claim to​ be consulting organizations fail to​ ask important questions such as​ salary and mortgage details that are essential to​ assess the​ appropriate cover. So,​ an ideal solution to​ this problem would to​ make selling of​ insurance more transparent. But like all practical solutions,​ it​ is​ not in​ everyone’s interest to​ do so. as​ a​ result,​ insurance companies have lobbied congress men and women very heavily to​ ensure that despite the​ benefits of​ transparency,​ obscurity remains the​ law.
Another problem with insurance that is​ often never disclosed by sellers,​ is​ that the​ insurance premium is​ also very unstable. the​ rates may even change between consecutive billing cycles. For example,​ a​ driver with a​ recent accident history will have a​ pay a​ much higher premium than a​ regular driver. Such a​ driver will be left with no other option but to​ pay a​ high premium,​ since insurance has been made mandatory for driver in​ many states.
Insurance premiums are also very relative. They are based on​ extensive research and statistics. For instance,​ a​ policy holder who smokes might have to​ pay as​ much as​ twice the​ amount paid by a​ nonsmoker. Some companies also have a​ provision wherein the​ premiums are reduced if​ the​ policy holder changes his habits. However,​ evidence based on​ medical tests will have to​ supplement this argument. Premiums may also fluctuate according to​ market trends.
As stated previously,​ it​ is​ not always in​ the​ best interest of​ the​ insurer to​ be up front with you​ regarding the​ many pitfalls which surround the​ purchase of​ insurance. However,​ by understanding not only some of​ the​ omissions as​ well as​ grasping the​ underlying motivations of​ insurers customers can be must better situated to​ make good decisions regarding their insurance needs




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