The importance of the broker - 25 May 2010 13:40
Insurers, particularly direct short-term insurers, use bonuses and payback to buy your loyalty. But is their loyalty to you worth what yours is to them? Is an insurance payback worth having your claims rejected because of ambiguous wording in your insurance policy? Insurers often capitalise on their consumers lack of understanding of the insurance process, which has necessitated the Consumer Protection Act, which calls for insurers to be more open with their policyholders.
Despite this though, it seems as though insurance companies do what they can to avoid paying out claims. In fact, in 2009 the Ombudsman for Short-term Insurance (OSTI) got insurers to settle R113 million in claims that were originally repudiated. Is there any real reward for being loyal to your insurer?
It’s no longer about loyalty, even with long-term insurers who pay out no more than you’ve paid in should your investment have underperformed. It’s about insuring correctly, which is where brokers become worth their price.
Brokers personally review your cover annually and recommend adjustments so that you don’t pay more than you get out while paying enough to cover you thoroughly. They make sure that your premiums are competitive too, while advising you on certain types of cover and policy options, such as excess. They also draw your attention to any exclusions and disclaimers in your policy and assist with the claims process.
While you often pay more for a broker than to go direct, you get the cover you need at the price you can afford. The price of broker can be worth it.
Insurers, particularly direct short-term insurers, use bonuses and payback to buy your loyalty. But is their loyalty to you worth what yours is to them? Is an insurance payback worth having your claims rejected because of ambiguous wording in your insurance policy? Insurers often capitalise on their consumers lack of understanding of the insurance process, which has necessitated the Consumer Protection Act, which calls for insurers to be more open with their policyholders.
Despite this though, it seems as though insurance companies do what they can to avoid paying out claims. In fact, in 2009 the Ombudsman for Short-term Insurance (OSTI) got insurers to settle R113 million in claims that were originally repudiated. Is there any real reward for being loyal to your insurer?
It’s no longer about loyalty, even with long-term insurers who pay out no more than you’ve paid in should your investment have underperformed. It’s about insuring correctly, which is where brokers become worth their price.
Brokers personally review your cover annually and recommend adjustments so that you don’t pay more than you get out while paying enough to cover you thoroughly. They make sure that your premiums are competitive too, while advising you on certain types of cover and policy options, such as excess. They also draw your attention to any exclusions and disclaimers in your policy and assist with the claims process.
While you often pay more for a broker than to go direct, you get the cover you need at the price you can afford. The price of broker can be worth it.