Johannesburg – Insurance is an age-old concept where people pool their resources together to cover themselves against accidents, loss, or other unfortunate circumstances. In the modern world, there is a range of insurance products on offer from various insurance providers, which all have their own terms and conditions. This makes it more difficult to select an insurance policy correctly, ensuring that you are fully covered when an accident or loss occurs. However, there are a few principles you can follow to ensure that your insurance coverage gives you the benefits you need:
1. Do proper research before you select your insurer: Use the internet and other resources at your disposal to establish if the insurance provider you are considering is a reputable provider. There should be information online about their history and benefit options, while other customers’ reviews will also give you a good indication of the quality of their offering and the service they provide. Compare the benefits, pricing and flexibility of the policies offered by at least three insurers.
2. Your insurance cover must meet your unique needs: Only you know what your needs are when it comes to covering yourself against risk. So, ensure that the insurer you choose is meeting the needs you have in your current life stage. Also keep in mind that you need to review the insurance policies you have in place every year or when your life circumstances change, like when you buy a car or house, get married or form a life partnership, or start a family.
3. Understand all the relevant information applicable to your policy: Always make sure that you are equipped with all the necessary information about your policy’s terms and conditions, as well as your rights and responsibilities as a customer. You firstly need to understand all the terminology in your policy documents to avoid any misunderstanding of what you can expect from your cover and, secondly, you need to familiarize yourself with the claims process and the steps to follow in the unfortunate event you suffer a loss.
4. Disclose all the details that are relevant to the risk you are covering:A good case in point is car insurance where you need to provide the details of the principal driver, whether the car is used for business or personal trips and the risk address where the car is parked when you aren’t driving. Insurers need this information to assess the risk, determine the appropriate premium and ultimately ensure you are correctly covered. Remember that if you fail to disclose these factors, your claim can be repudiated or only paid in part.
5. Build up a good insurance history: Get your own insurance and maintain a good record through responsible behaviour like safe driving — this will go a long way to help you qualify for lower premiums.
6. Added security features can reduce your risk premium: If it’s your car or house you are insuring, furnish these assets with safety features (such as tracking devices and alarms linked to armed response). Also be sure to let insurers know when the risk diminishes for an item you have covered – as an example, when you move to an area with a lower crime rate, or when you start parking your car in a garage instead of off-street, as this could help you to qualify for a lower premium. Other steps you can take to qualify for lower car insurance premiums is to take a digital driving test or advanced driving course.
There are many types of insurance on the market, ranging from car and house insurance, life insurance, funeral cover, debt protection, serious illness to disability cover. The policies you choose will not only be influenced by your current lifestyle, but also by your financial status and the affordability of a particular policy. It may be tempting to put insurance cover on the backburner when times are tough but remember that your financial advisor can offer you options that reduce your monthly payments while still providing you with essential cover.
By Dr Hardy Ncube