Picking an insurance company to use is not an easy task, considering the financial crisis of 2008 and 2009. Several financial institutions and insurance companies have gone out of business, merged with stronger firms or sold particular divisions of their company outright. Don't get too scared; state guaranty funds will pay claims up to a certain limit if your insurance company goes under. Here are some other factors to consider:

When choosing your insurance carrier, there are several factors that you should consider to help you make a wise decision. Consider some of the following:

  • What is the quality rating of the insurance company, as published by the main rating agencies in comparison with their peers? (Moody's, Standard & Poor's, & AM Best - claims
  • Paying ability, financial strength, assets etc…)
  • Is the insurer a specialist in this area of insurance coverage?
  • Is it easy to speak to a "live" person and will you be working with the same person (agent)?
  • Will it provide insurance coverage that is adequate for your needs?
  • Is its policy premium cost effective when compared to similar insurance companies?
  • What are the deductibles?
  • What is the claim paying process?
  • Does the insurer give family discounts on premiums for multiple policies?
  • If proximity is an issue for you, is there a local office nearby?
  • Consider the company's record for claim refusal. Your state insurance commission may have a record of complaints

This question was answered by Steven Merkel

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