What the Insurance Companies Aren't Telling You About Your Premium

 


Visitors: 440

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 non-smoker. 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

Marcus Dubois is a veteran in the insurance industry, and recommends InstaQuoter to get an instant insurance quote. See http://www.instaquoter.com/ for more information

(509)

Article Source:


 
Rate this Article: 
 
Health Insurance - Practical Ways To Reduce Your Family Health Insurance Premium
Rated 4 / 5
based on 5 votes
ArticleSlash

Related Articles:

What The Doctors Aren't Telling You - 1 - Cholesterol & Plaque

by: Hal Clarkson (July 04, 2007) 
(Health and Fitness)

What The Doctors Aren't Telling You - 2 - Cholesterol & Plaque

by: Hal Clarkson (July 04, 2007) 
(Health and Fitness)

What The Doctors Aren't Telling You About Your Health 2 -The Loop

by: Hal Clarkson (July 26, 2007) 
(Health and Fitness)

The Identity Theft Epidemic : What The Experts Aren't Telling You

by: Jonathan Kraft (February 26, 2005) 
(Legal/Identity Theft)

Series - What The Doctors Aren’t Telling You About Your Health. 2 ..

by: Hal Clarkson (May 26, 2007) 
(Health and Fitness)

Cheap Auto Insurance Companies in Illinois How to Find the Cheapest Car ..

by: James J. Robinson (July 24, 2008) 
(Insurance/Car Auto)

Moving Companies Aren’t Always Forthcoming About Details

by: Sally Newcomb (September 10, 2010) 
(Home Improvement)

Car Insurance How Can You Really Lower Your Insurance Premium?

by: Nicholas Vernon (June 18, 2008) 
(Insurance/Car Auto)

Group Insurance - Understand Premium Rates, Experience and Pooled Basis of ..

by: Kyle J Norton (November 10, 2008) 
(Insurance/Life Annuities)

Health Insurance - Practical Ways To Reduce Your Family Health Insurance Premium

by: Chimezirim Chinecherem Odimba (June 09, 2007) 
(Insurance/Health)