In life, individuals often encounter unforeseen circumstances. Insurance allows people to manage the financial burden that occurs if and when these incidents occur. This insurance can take on a number of different forms, providing a safety net from the various risks associated with everyday living. Given the importance of having financial assistance in times of peril, it’s critical that individuals choose an insurance company that is both reputable and reliable. Many insurance companies promise to provide financial compensation but renege on their obligations through loopholes and contractual fine print. The following is a brief list of the types of insurance available, as well as tips on what to look for to avoid fraudulent or misleading insurance.
Car insurance protects the owner from losses occurring due to vehicular damages and bodily harm. Most state car insurance laws prevent companies from unscrupulous practices. However, some insurance companies will find legal workarounds, such as quoting low premiums for the first few months only to send a notification months later that the figure was quoted in error.
Life insurance is designed to safeguard family members financially dependent on the death of a policy holder. Many scams center around replacing existing annuities with new ones in exchange for a cash bonus. However, as annuities require decades of maturation before they can be withdrawn, many seniors are unable to access their funds as a result of these bait and switches.
This insurance type protects homeowners from the cost of damages via fires, burglary, floods, earthquakes, and natural disasters. However, many insurance companies will have certain stipulations in the contract which prevent homeowners from collecting. For example, a fire caused by arson may not be covered, or an earthquake that doesn’t reach a particular magnitude to qualify for compensation.
Medical insurance provides financial assistance for expenses due to illness or injury. In order to avoid paying benefits, insurance companies have been known to deny coverage for specific procedures or for patients with pre-existing conditions.
As most insurance plans do not cover incidents occurring abroad, having travel insurance safeguards individuals from unexpected medical expenses during a trip. However, as travel insurance requires only a single payment and not an ongoing premium, many scammers can set up a company to procure a lump sum from a client and disappear.
With all types of insurance, be sure to check with the Better Business Bureau or respective ratings organization to verify their status. However, even with reputable companies, take care in perusing through the fine print and know the specific situations which are covered by your insurance.