They’re big alright, but are they for you?

Is bigger necessarily better when it comes to insurance coverage? In my first article for The Telegraph, I addressed the question, “Is insurance a commodity?” Just because a company dominates television advertising and the web, does it make it a better company? This question came to light when I recently quoted a young lady an auto insurance policy with two regional and one national carrier. Since she is younger than 25, she has grown up with the mass marketing campaigns of several large national insurers, which can sway your selection and limit your savings.

I told her that big did not necessarily mean better. What you want to make sure of is that you are getting the correct coverage at the best rate with a company that is rated “A” or higher by A.M. Best Co. for financial stability and customer service. Financial stability measures the insurer’s ability to pay claims that are due. It has nothing to do with their timeliness and fairness in settling claims. For that information you would have to rely on an agent or a friend who is a customer of another insurer. Consumer Reports annually rates companies based on survey feedback from members.

Typically, you will see some smaller, regional companies rated higher than large, national companies. But claims handling may be inconsistent from state to state within a company and even can vary by adjuster. We are all human. That is why you should reach out to several friends and ask them about their experiences with their companies on a local level. Do not be afraid to call an agent to ask them for advice, but if you do get a quote that is slightly lower than what you are paying, do not be satisfied and stop there. Get several quotes with different companies and compare the coverage and cost.

Many companies that advertise a lot and attract many new customers may not be able to keep up with the increased business and hire and train good claims adjusters. Stability and experience helps when handling claims for customers. The goal is always to pay what is owed in a timely fashion and get the customer back to the pre-loss condition.

This story was originally published July 11, 2017 at 2:40 PM with the headline "They’re big alright, but are they for you?."