? How to find insurance companies

Before signing up for insurance, you need to understand how insurance companies work. To help understand that we have provided a detailed explanation of the insurance companies business model based on internet research and speaking with some friends who are experts and in the professional insurance industry. Let's break the model down into components:

Underwriting and investment

Demands

marketing

Underwriting and investment

In principle, we can say that the business model of insurance companies is to collect more value in premium and investment income than the value spent in losses while at the same time offering a reasonable price that customers will accept.

Profits can be described by the following formula:

Profits = Premiums Earned + Investment Income - Loss Incurred - Underwriting Expenses.

Insurance companies make their fortune in these two ways:

Underwriting is the process that insurance companies use to determine the risks to be insured and choose the amount of premiums that will be charged to accept those risks.

Investing the received values ​​in installments.

A complex side of the business model of insurance companies is the actuarial science of setting prices, based on statistics and the probability of estimating the value of future claims within a given risk. After setting the price, the insurance company will either accept or reject the risk using the underwriting process.

Taking a look at the frequency and severity of insured liabilities and the estimated average payment is what a simple-level valuation is. What companies do is check all that historical data on the losses they incurred and update them according to today's values ​​and then compare them with the premiums earned to assess the price adequacy. Firms also use expense and loss charge ratios. Simply, we can say that comparing losses to loss relativity is how different risk characteristics are classified. For example, a policy with double losses must impose a premium of double the amount. Of course there is room for more complex mathematical operations with multivariate analysis and parametric computation, always taking the history of the data while entering it to use in assessing the probability of future losses.

Underwriting profit for companies is the amount of insurance premium collected when the policy expires minus the amount of value paid on claims. Also we have underwriting performance A.K.A. The combined ratio. This is measured by dividing the losses and the expense values ​​by the premium values. If it is higher than 100% we call it underwriting loss and if it is less than 100% we call it underwriting profit. Do not forget that as part of the corporate business model, there is an investment part which means that companies can make a profit even with underwriting losses.

The flotation is how insurance companies earn their investment profits. It is the amount of value collected as premiums over a certain period of time that have not been paid in claims. The flotation investment begins when insurance companies receive payments from premiums and ends when claims are paid. Since this time frame is the period for which the interest is being earned.

Insurance companies from the United States operating in accident and property insurance suffered an underwriting loss of $ 142 billion in the five years ending in 2003, and in the same period, they reported a total profit of $ 68 billion as a result of the flotation. Many industry professionals believe that it is always possible to make a profit from floatation without necessarily an underwriting profit. Of course there are many streams of thought on this.

Finally, one of the important things to consider when subscribing to new insurance is that in times of economic depression, markets have trends that carry and evade insurance companies from floating investments and cause the need to reevaluate premium values ​​which means higher prices. Therefore this is not the time to subscribe to or renew insurances.

The change in times of profit and non-profit is called underwriting cycles..

Claims

The actual "product" paid in the insurance company industry is claims and loss treatment, as we might call it material benefit for insurance companies. Representatives of insurance companies or negotiators can assist clients with filling out claims or they can be .filled out directly by the companie.

The vast amount of claims are employed by claims settlement officers and supported by records management personnel and data entry personnel within the corporate claims division. Oysters are graded on the basis of severity criteria and reserved for claims settlement experts. Claims settlers have variable settlement authority according to their respective experience and knowledge. After allocation, investigation is followed in cooperation with the client to determine whether it is covered by the contract. Value investigation outputs and approval to pay thecustomer.

Sometimes, a client can enlist the assistance of a public officer to negotiate an agreement with the insurance companies on his behalf. In more complex policies where claims are difficult to manage, the client may usually use a separate policy added to cover the general officer cost, called loss recovery insuran

When managing claims handling jobs, companies try to anchor customer satisfaction, administrative overhead, and payment leakage requirements. Insurance bad faith usually comes from this act of balance causing fraudulent insurance practices that pose a high risk for companies to manage and overcome. Dispute between clients and insurance companies often leads to litigation. Claims handling practices and validity of claims are the scalating issues

marketing

Insurance companies use negotiators and representatives to start the market and sponsor their clients. These negotiators are bonds to a sole proprietorship or self-employed, which means they can get rules and conditions from many other insurance companies. It is proved that achieving the goals of the insurance companies is due to the tailored and designed services of the actors