Customers are becoming more and more on the ball regarding their insurance policies

Insurance covers almost everything these days and the web has created a highly transparent and competitive market place for domestic and global insurers. You are required by law to have certain insurance such as car insurance or medical insurance in many countries. Other insurance although optional in law is seen by most as a ‘must have’ such as travel insurance or insurance for corporate property and business assets. Then there is a third class of insurance focused mainly on the consumer market which is more specialised such as pet policies, wedding insurance or insurance for extreme sports such as skiing. On the high street or online, companies set their policy prices and excesses at varying rates depending on various factors. There is also a secondary market for the services of insurance brokers who trawl the market for products at the request of their corporate or consumer clients. Underwriters are another group of agents operating in the insurance industry.

Underwriting is basically where the risk to the insurer and other risks are calculated and the underwriter determines the correct pricing arrangement for the insurance services or whether to insure at all. To take the example of car insurance, the underwriter would assess the drivers accident record. In medical insurance, another example might be where the patients sickness record is examined. The internet is certainly helping helps the insurance sector remain competitive and transparent but many customers are even now finding themselves without cover when they most need it. Winter sports insurance is an excellent example of this. The industry believes that over 50% of travelers to ski resorts have no insurance and although the other half do, only a quarter of them are actually insured for skiing and snowboarding which are classified by most insurers as ‘extreme sports’ and excluded from their plans. In the main, European travellers also think that their E111 is adequate to get them treatment but this is not the case in most resorts. Another recent example of The way the insurance market is adapting is the hot pricing competition between opposing auto insurance companies that has been in the main facilitated by the introduction of price comparison sites. Car insurance is required by law so everyone must purchase it. This puts price up there as the chief competitive factor.

An example of negative activity in the insurance market was when payment protection insurance policies (PPI’s) were discovered by the FSA to be negligent drafted or having been fraudulently marketed. This has lead to a huge amount of litigation and firms actually being set up for the single purpose of acting as agents by which customers can claim back any PPI that might have been missold to them. Compare travel insurance on the net for the greatest bargain. Another questionable product is identity theft insurance that promises to reimburse the customer for any loss as a result of cyber fraud or identity theft. However many people are unaware that the bank is in most sets of circumstances liable for such acts.