Buying insurance

There are several ways to find and buy insurance to cover almost every risk you might encounter. They include:

• Buying insurance directly from an insurance provider or your bank - either in person, online or by phone.
• Using a price comparison website, which will compare the cost of insurance from different providers.
• Contacting an insurance broker, who will find an insurance product to suit your circumstances.

You could also be offered certain insurance coverage as part of a purchase, or have it included within a policy you already have in place.

Examples of ‘bundled insurance’ include:

• Travel insurance that comes included within the price of your holiday or travel booking.
• Breakdown coverage that comes free with your car insurance.
• Identity theft coverage that's included with a credit card. 

As well as ‘bundled insurance’ you may also be offered an extended warranty as an incentive to purchase, in addition to any warranty or guarantee period required by law.

Examples include:

• Warranty coverage that comes as part of the deal you've negotiated for a used car.
• Extended warranties and coverage that come with the purchase of new products (for example, a washing machine).

The insurance and/or warranties described in these examples may provide all the coverage you need. Be aware, however, that you may find more comprehensive, or more flexible coverage that better suits your needs if you purchase it separately.

When you're looking at the coverage offered by different insurance providers, it can be hard to make a useful or meaningful comparison.

For example, one might offer a lower premium, but include a higher deductible payment in the event of a claim. Another might include a broader range of coverage and benefits, but at a higher premium.

How do you go about selecting the right policy?

• Start with the basics - make a list of all the elements of coverage, the terms and the benefits you actually need, or want.
• Focus only on the policies that provide essential coverage - all of the elements of coverage that you consider essential. Anything else offered can be considered a bonus.
• Consider what isn’t included - in many ways this is more important than what is covered. For example, your travel insurance might exclude claims relating to pre-existing medical conditions.
• Now make your final selection based on these 3 criteria - price, payment terms and, often overlooked, the provider’s reputation in the eyes of its existing customers.

While price may be a deciding factor when it comes to choosing insurance, it's a good idea to check out a provider’s reputation before committing. There are plenty of review websites that will give you genuine, honest and unbiased reviews from a provider’s existing customers.

You might want to find out:

• What percentage of claims are settled without challenge?

• How easy is it to make a claim?

• How quickly are claims settled?

• How satisfied are the provider’s existing customers?

Increasingly people want to be reassured that their money is going to organizations whose values are aligned with their own. Paying a little more to insure with a brand you value and trust may be more important to you than going with the provider offering the cheapest coverage.

You may also want to do a little research about a provider’s ethical or environmental credentials before committing to them.

1. Always check the detail of an insurance quote
   You'll want to make certain that it suits your individual needs. For example, can you pay in monthly installments?
2. Make sure you provide accurate information
   Answer any questions asked honestly when applying for a quote. If you don't, there's a chance that a claim may be reduced in value, or your policy cancelled altogether.
3. Remember to update your policies
   Your needs will change over time and it's often a requirement of an insurance policy to let them know of any changes to your circumstances. If you don't, it’s possible for a claim to be rejected.
4. Review your coverage from time to time
   For general insurance (e.g. car or home insurance) you could do this each time your renewal is due. For other, longer term coverage (e.g. life insurance) you could review your needs at significant life stages, like getting married, moving in with a partner or starting a family.