Direct Insurance Essentials: Getting you More Protection

Direct insurance has joined the field of industries who are “cutting out the middleman”. Fueled by the Internet revolution, consumers can now buy direct insurance policies from giant, established insurance names down to niche insurers can talk directly to customers and sell them policies.

What you can Insure With Direct Insurance

Once the purview of supplemental life insurance policies, direct insurance can now be purchased for nearly any need. Auto, property, rental and life are all basic offerings of the largest direct insurance companies. Direct health insurance offerings, though fewer, are growing in number as well.

Larger companies offer more specialized direct insurance such as motorcycle, boat or jet ski, umbrella liability, and even small business policies.

Where to Find Direct Insurance Companies

Several recognizable big names sell direct insurance via exclusive agents across the country. These agents are under exclusive contract to one particular insurer and do not charge commissions on top of premiums.  Other insurers are found only via phone and the Internet.  

Some direct insurance companies advertise copiously via magazine and television, while others rely on Internet marketing and word of mouth to find customers. If an unfamiliar name pops up while searching, check it out with A.M. Best, an independent analyst of insurance companies’ financial strength, at http://www.ambest.com. Customer satisfaction for many direct insurance companies can be found at the JD Power website (http://www.jdpower.com).

Direct Insurance vs. Broker Insurance

Many consumers prefer direct insurance because they don’t like the idea of going through a middleman to receive policy and coverage quotes, and they don‘t wish to pay a broker‘s commissions. Direct insurance puts their minds at ease that they are getting their insurance at the best price.

But buying direct insurance requires a consumer to be more savvy. Particularly, a direct insurance shopper has to make sure he is comparing “apples to apples”; in other words, that he is getting quotes for the same amounts of coverage from each company. That can mean lots of phone calls. A beginner might easily feel overwhelmed.

Luckily, there are now several direct insurance quote engines on the Internet. A good place to start is at Esurance.com (http://www.esurance.com) and its specialized partner websites. A quick search will give the shopper an idea of what policies cost in his area and what coverage is included.

People with “special conditions” might find shopping for direct insurance difficult. A special condition is any issue that might raise a red flag when an insurer is assessing risk. Some examples might be a patient with a chronic heart condition (for a health insurance or life insurance candidate), or a driver with many moving violations on his driving record (for auto insurance).

A special-conditions consumer will not be able to trust the basic quotes from the Internet, and will have to personally make contact with each direct insurer that he wants to consider. Some special conditions may be considered uninsurable by most direct insurance companies. Such shoppers should consult a broker for a specialty policy through a niche company.

Besides access to difficult-to-insure policies, some leading insurance companies continue to be sold only through independent brokers. Brokers also act as advocates for their clients on claims to insurance companies. Shoppers need to weigh the value of this service against any cost savings on their policies.

Direct insurance is a great tool for the savvy insurance shopper who wants transparency in his insurance dealings. Carefully researching direct insurance companies and coverage options will lead to adequate coverage at the right price.
 


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