An independent insurance broker is a person who is licensed by the department of insurance in the state (or states) where he or she conducts business. Licensure generally involves passing a written examination to show that the person meets minimum standards of knowledge regarding the business of insurance.
Independent insurance brokers are typically parties to contracts with several insurers by which the broker is authorized to write business (i.e., policies) for that insurer. In most states, each insurer files a notice of appointment of each broker with the department of insurance in that particular state. Independent brokers are usually compensated by the insurers they represent through payment of a commission that is a fixed percentage of the premium of each policy sold. This commission percentage may vary with the size of the premium or line of business. For example, insurers often pay higher commissions on commercial lines policies than they do on personal lines policies.
Tuesday, August 3, 2010
business of insurance
" The business of insurance differs from most other businesses. Because insurers sell an intangible product—a promise to pay in the event of contingent losses—and because these promises potentially affect so many, the business insurance is regulated more heavily than most other businesses.
role of insurance in the economy
From the complete book of insurance
Insurance. What a pain! Your mortgage lender requires that you carry fire and other perils coverage (i.e., homeowners insurance ) and sometimes even flood or earthquake insurance. Your auto lender requires that you carry physical damage coverage. Under the laws of many states, you are required to carry auto liability and/or no-fault liability insurance, often including uninsured motorist and underinsured motorist coverages.
To many, insurance just represents dollars out of pocket with no benefit. This is an unfortunate attitude. Insurance plays a broad role in the worldwide economy, helping to assure that millions of transactions and other activities, economic and noneconomic, can proceed. Without insurance quotes, local, state, national, and international business would quickly grind to a halt. Lenders would cease lending for purchases of land, buildings, homes, vehicles, or equipment. Without premises liability insurance, a simple slip-and-fall claim could put a small business owner out of business.
Manufacturers could not sell products without liability insurance to respond in the event a defective product injures customers or other users of their products. Absent product liability insurance, a seller of a defective product who has no role in the design and manufacture of the product, could face a ruinous lawsuit or judgment.
The average individual has similar concerns. What are the consequences of an uninsured liability lawsuit—whether rising from an auto accident or a premises insurance claims arising from homeownership question? The answer is often bankruptcy, which can follow a person for a lifetime. It can result in being turned down for a job, being denied credit, or receiving credit only at high interest rates.
The concept of insurance is really very simple. In exchange for the insured’s payment of a relatively small sum of money—the premium—the insurer assumes the risk of financial consequences for the loss of the insured’s property (such as a house or car) or the risk of the loss presented by the costs of defending a liability lawsuit (and where appropriate, paying a resulting settlement or judgment). This can provide financial security for the average consumer—that is you—which strengthens our economy as a whole and spurs further growth.
Insurance. What a pain! Your mortgage lender requires that you carry fire and other perils coverage (i.e., homeowners insurance ) and sometimes even flood or earthquake insurance. Your auto lender requires that you carry physical damage coverage. Under the laws of many states, you are required to carry auto liability and/or no-fault liability insurance, often including uninsured motorist and underinsured motorist coverages.
To many, insurance just represents dollars out of pocket with no benefit. This is an unfortunate attitude. Insurance plays a broad role in the worldwide economy, helping to assure that millions of transactions and other activities, economic and noneconomic, can proceed. Without insurance quotes, local, state, national, and international business would quickly grind to a halt. Lenders would cease lending for purchases of land, buildings, homes, vehicles, or equipment. Without premises liability insurance, a simple slip-and-fall claim could put a small business owner out of business.
Manufacturers could not sell products without liability insurance to respond in the event a defective product injures customers or other users of their products. Absent product liability insurance, a seller of a defective product who has no role in the design and manufacture of the product, could face a ruinous lawsuit or judgment.
The average individual has similar concerns. What are the consequences of an uninsured liability lawsuit—whether rising from an auto accident or a premises insurance claims arising from homeownership question? The answer is often bankruptcy, which can follow a person for a lifetime. It can result in being turned down for a job, being denied credit, or receiving credit only at high interest rates.
The concept of insurance is really very simple. In exchange for the insured’s payment of a relatively small sum of money—the premium—the insurer assumes the risk of financial consequences for the loss of the insured’s property (such as a house or car) or the risk of the loss presented by the costs of defending a liability lawsuit (and where appropriate, paying a resulting settlement or judgment). This can provide financial security for the average consumer—that is you—which strengthens our economy as a whole and spurs further growth.
Friday, July 23, 2010
Why your business needs insurance
Entrepreneurs often see business insurance as one of those costs which you could almost get away with not buying.
Aside from legal requirements and demands from customers to have a certain level of liability, you might well think that there is little point to your insurance policy.
However, there are many examples of businesses going to the wall following a disaster for which they weren't covered. Similarly there are many instances when a company has bounced back after it looked like it had passed the point of no return – all because they were insured to the very hilt.
You might consider the risks that your business faces to be small or even affordable, but if this is the case then there is a very good chance that you are underestimating them.
The chances of your business being hit by a flood or destroyed by a fire might seem low, but disruption to your work can come from many quarters.
A criminal act in your street could lead the police to cordon off the area for a period of time. Despite not being able to trade, you will still have to pay your staff, rent and other costs. You could lose a very significant amount of business or incur heavy costs while attempting to maintain it.
However, all of this could be prevented with a business continuity insurance deal.
As mentioned, some of your clients might ask about your insurance details before they are prepared to do business with you. Public liability is important for many clients, particularly in the public sector.
In a business-to-business setting, an insurance policy acts almost like a credential. By having a high level of cover you are demonstrating that you are a respectable business which takes health and safety very seriously, and that you fully understand your own responsibilities.
Therefore it isn’t just dead money, but a way of accessing opportunities which you wouldn’t otherwise be able to gain
Aside from legal requirements and demands from customers to have a certain level of liability, you might well think that there is little point to your insurance policy.
However, there are many examples of businesses going to the wall following a disaster for which they weren't covered. Similarly there are many instances when a company has bounced back after it looked like it had passed the point of no return – all because they were insured to the very hilt.
You might consider the risks that your business faces to be small or even affordable, but if this is the case then there is a very good chance that you are underestimating them.
The chances of your business being hit by a flood or destroyed by a fire might seem low, but disruption to your work can come from many quarters.
A criminal act in your street could lead the police to cordon off the area for a period of time. Despite not being able to trade, you will still have to pay your staff, rent and other costs. You could lose a very significant amount of business or incur heavy costs while attempting to maintain it.
However, all of this could be prevented with a business continuity insurance deal.
As mentioned, some of your clients might ask about your insurance details before they are prepared to do business with you. Public liability is important for many clients, particularly in the public sector.
In a business-to-business setting, an insurance policy acts almost like a credential. By having a high level of cover you are demonstrating that you are a respectable business which takes health and safety very seriously, and that you fully understand your own responsibilities.
Therefore it isn’t just dead money, but a way of accessing opportunities which you wouldn’t otherwise be able to gain
Sunday, July 4, 2010
home owner insurance
You've suffered a loss to your house: fire, wind damage, massive water damage, tree falling on your roof. You're upset. What is your first move? Call your insurance company, right? Wrong!The average homeowner is ill-prepared to deal with the insurance company. They think that they will be treated fairly and justly by the company. But, by whose definition of fair?" Getting Your House In Order teaches you what you need to know to get a proper, fair and equitable settlement for your loss so that you can restore your home to pre-loss condition. Written by an industry expert with years of experience helping homeowners and reviewed by professionals, Getting Your House In Order will help you turn a disaster into a more positive circumstance. Everyday, thousand of homes are ripped apart by sudden and accidental disasters. They are at a loss of what to do. They believe that they are in good hands with their insurance companies and believe they will be properly compensated for their loss. Their lack of knowledge causes them to fall prey to the more knowledgeable insurance company and can leave them thousands of dollars short in necessary funds. This home owners insurance book guides them step-by-step back to recovery so their house can be set in order. Without this vital information, a homeowner is defenseless. Doug Wead Author's friendly conversational style puts you at ease so that you can deal confidently with the insurance company. Industry jargon is clarified so that you're not mystified. Its reference style lets you refer to only the sections that pertain to your situation. And its information-packed pages position you on an even-footing with the insurance company's adjuster." Todd Reilly, Realtor
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