5 questions to ask your broker
1. Do you have a reference?
Any reputable broker will not hesitate to give you references. He should be able to prove that he is trustworthy and give you references that are able to verify his reputation.
2. How long have you been in the industry?
A good broker will have a few years of industry experience behind him. This is important as he must be able to update you on any policy changes. He must also have exposure to a wide number of products to be able to source the best for you.
3. Who do you work with?
A support team is vital to a broker’s success and therefore the service that he is able to offer you. Make an appointment to meet the people he works with and find out who will be dealing with you. You do not want to be passed from person to person.
4. How long does it take to process a claim?
You need to find out what the typical waiting period is and what his track record is regarding efficient claims processes. How involved is he in the claims process? Is it a purely back office process or does he help move things along?
5. How much contact with you will there be?
After you have signed all the documents, your broker may disappear. You should be able to contact him and see him at least once to explain the policy and iron out any concerns you may have.
The essentials of insurance
Insurance is often referred to as a grudge purchase. That’s really because we are paying money upfront for something that may never happen. But in this fast-paced economy and a future full of uncertainty, such as crime, retrenchment, vehicle breakdowns, medical emergencies etc, insurance is very important. Put another way, insurance provides certainty in an uncertain environment.
There are various forms of insurance.
Medical insurance is arguably the most important kind of insurance and no responsible adult should conduct his/her life without it. No one can prepare for getting sick, but when you do it will help your state of mind to know that your medical costs are covered by insurance.
There are two main types of medical cover. These are medical aids and hospital plans.
Medical aids cover all your daily doctors’ visits and pharmacy bills (the higher the premium the more you will be covered for) and costs incurred by any hospital stay.
You need to know what you are covered for as most plans have exclusions which you should discuss with a broker.
A hospital plan is just that. You will be covered in the event you land up in hospital due to illness or an accident. Again you have to understand your policy and know what the exclusions are.
Medical cover is vital and there are a variety of plans in the market place. Whether you need cover for yourself or your family it is not something to be overlooked.
Lifestyle aspects in addition to age are things like diet, exercise, risk exposure and general health.
Costs are determined by assessing risk profiles. In other words, if you have a healthy lifestyle – eat well, exercise, don’t drink etc – your premium will be less. If you smoke, drink, and sit behind a desk all day, your premium will cost more.
With high levels of crime you just can’t be too careful. Police statistics of housebreaking and burglaries are still at their highest levels. It is a good idea to have insurance for your household contents as well as the property itself. If you are insured for damages to your property you can claim if a thunderstorm destroys your roof. Once again read the small print and know exactly what you are covered for.
If you own a car you will probably want to have short term insurance. Car insurance falls into this category. Once again your risk profile will be assessed. If you are a reckless driver and park in an open field, don’t expect to get the best premium. A comprehensive policy usually buys you third party, fire and theft cover. Many people choose this option as it leaves nothing to chance. Once again, policies vary and for every claim there is an excess to be paid. The car insurance market is highly competitive and you need to shop around for the cover that works best for you and at a price that is affordable. The more expensive your car, the more it will cost to ensure. It makes good economic sense to drive a modest vehicle and keep your expenses manageable.
Income insurance has been around for a while and if you are lucky it will be taken care of by the company you work for. This means that in the event that you become disabled and cannot continue your work you will still receive your incomer or a portion of it to continue a reasonable standard of living. Sometimes the payout is equal to the income you were earning. The payout will provide an income until you are able to work again or until death.
The other type of income insurance is retrenchment insurance. This is quite new on the market and has probably not been considered by many. Most people who are gainfully employed do not think about retrenchment and do not believe it will happen to them. Well you may just be wrong. With a very strained job market and huge cut backs across a variety of industry, it is a very important to have retrenchment insurance. It is only offered by one or two companies, but it is worth your while to explore it and work it into your budget. In these times, it’s the survival of the fittest.