Awahba Insurance

We make our customers’ problems our problems.

Awahba Insurance - We make our customers’ problems our problems.

Insurance for Your Business

images (7)The importance of insurance cannot be over-emphasized and neither can the danger of paying for insurance you don’t need. It is strongly recommended you solicit the advice of an in-dependent business insurance agent. Don’t forget to SHOP! Talk to three or four independent agents and compare notes and prices. An insurance agent will lay out a vast array of insurance coverage much of which you simply may not need. Your situation will be unique and you must consider each insurance element carefully to ensure comprehensive coverage.

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Small Business Health Insurance – The Best Policy Is A Great Agent

images (10)I have been a health insurance broker for over a decade and every day I read more and more “horror” stories that are posted on the Internet regarding health insurance companies not paying claims, refusing to cover specific illnesses and physicians not getting reimbursed for medical services. Unfortunately, insurance companies are driven by profits, not people (albeit they need people to make profits). If the insurance company can find a legal reason not to pay a claim, chances are they will find it, and you the consumer will suffer. However, what most people fail to realize is that there are very few “loopholes” in an insurance policy that give the insurance company an unfair advantage over the consumer. In fact, insurance companies go to great lengths to detail the limitations of their coverage by giving the policy holders 10-days (a 10-day free look period) to review their policy. Unfortunately, most people put their insurance cards in their wallet and place their policy in a drawer or filing cabinet during their 10-day free look and it usually isn’t until they receive a “denial” letter from the insurance company that they take their policy out to really read through it.

The majority of people, who buy their own health insurance, rely heavily on the insurance agent selling the policy to explain the plan’s coverage and benefits. This being the case, many individuals who purchase their own health insurance plan can tell you very little about their plan, other than, what they pay in premiums and how much they have to pay to satisfy their deductible.

For many consumers, purchasing a health insurance policy on their own can be an enormous undertaking. Purchasing a health insurance policy is not like buying a car, in that, the buyer knows that the engine and transmission are standard, and that power windows are optional. A health insurance plan is much more ambiguous, and it is often very difficult for the consumer to determine what type of coverage is standard and what other benefits are optional. In my opinion, this is the primary reason that most policy holders don’t realize that they do not have coverage for a specific medical treatment until they receive a large bill from the hospital stating that “benefits were denied.”

Sure, we all complain about insurance companies, but we do know that they serve a “necessary evil.” And, even though purchasing health insurance may be a frustrating, daunting and time consuming task, there are certain things that you can do as a consumer to ensure that you are purchasing the type of health insurance coverage you really need at a fair price.

Auto Insurance Principles Should Apply to Health Insurance

Many Americans rely on their automobiles to get to work. No automobile means no job, no rent or mortgage money, no food. A single parent, struggling to make ends meet in the suburbs with 100,000 miles on the odometer, would presumably welcome the guaranteed opportunity for low-priced insurance that would take care of every possible repair on her auto until the day that it reaches 200,000 miles or falls apart, whichever comes first. Especially if the insurance is valid regardless of whether she even changes the oil in the interim.

So why aren’t the auto insurance companies writing such coverage, either directly or through used auto dealers? And given the importance of reliable transportation, why isn’t the public demanding such coverage? The answer is that both auto insurers and the public know that such insurance can’t be written for a premium the insured can afford, while still allowing the insurers to stay solvent and make a profit. As a society, we intuitively understand that the costs associated with taking care of every mechanical need of an old automobile, particularly in the absence of regular maintenance, aren’t insurable. Yet we don’t seem to have these same intuitions with respect to health insurance.images (8)

If we pull the emotions out of health insurance, which is admittedly hard to do even for this author, and look at health insurance from the economic perspective, there are several insights from auto insurance that can illuminate the design, risk selection, and rating of health insurance.

Auto insurance comes in two forms: the traditional insurance you buy from your agent or direct from an insurance company, and warranties that are purchased from auto manufacturers and dealers. Both are risk transfer and sharing devices and I’ll generically refer to both as insurance. Because auto third-party liability insurance has no equivalent in health insurance, for traditional auto insurance, I’ll examine only collision and comprehensive insurance — insurance covering the vehicle — and not third-party liability insurance.

The following are some commonly accepted principles from auto insurance:

* Bad maintenance voids certain insurance. If an automobile owner never changes the oil, the auto’s power train warranty is void. In fact, not only does the oil need to be changed, the change needs to be performed by a certified mechanic and documented. Collision insurance doesn’t cover cars purposefully driven over a cliff.

* The best insurance is offered for new models. Bumper-to-bumper warranties are offered only on new cars. As they roll off the assembly line, automobiles have a low and relatively consistent risk profile, satisfying the actuarial test for insurance pricing. Furthermore, auto manufacturers usually wrap at least some coverage into the price of the new auto in order to encourage an ongoing relationship with the owner.

* Limited insurance is offered for old model autos. Increasingly limited insurance is offered for old model autos. The bumper-to-bumper warranty expires, the power train warranty eventually expires, and the amount of collision and comprehensive insurance steadily decreases based on the market value of the auto.

* Certain older autos qualify for additional insurance. Certain older autos can qualify for additional coverage, either in terms of warranties for used autos or increased collision and comprehensive insurance for vintage autos. But such insurance is offered only after a careful inspection of the automobile itself.

* No insurance is offered for normal wear and tear. Wiper blades need replacement, brake pads wear out, and bumpers get dings. These aren’t insurable events. To the extent that a new car dealer will sometimes cover some of these costs, we intuitively understand that we’re “paying for it” in the cost of the automobile and that it’s “not really” insurance.

Is Buying Business Insurance the New Texas Holdem Poker?

If you’re looking to buy Business Insurance you’ll have a certain level of power over a number of insurance brokers, insurance companies and insurance providers all wanting to do business with you.

With this in mind we’ll put you in the position of the dealer in our game of Business Insurance Poker so you can watch the game develop. Are you sitting comfortably? Then let’s begin:

If you already have Business Insurance we’ll give your existing insurance provider the dealer button as they really have the best seat at the table. They’ve already built some kind of relationship with you and they can sit back and wait to see what the competition does before they decide to act.

images (9)So next is the small blind. The small blind has an interest in your business as they’ve put in some of their own money in the hope they can win your business. You may have seen an advert for them, they may have sent you a letter or they may have called you to see if you’d like a quote for your Business Insurance.

Next is the big blind. The big blind when it comes to Business Insurance could well be an insurance provider you’ve heard of. They’ve spent a sizeable amount of money to get your attention (maybe a television advert or some promotion in the National press) and they aren’t likely to give up without a struggle. So those are the 3 insurance providers who definitely are interested in you and your Business Insurance:

- Dealer button – Your existing insurance provider

- Small blind – Maybe an insurance broker who would like to help you

- Big blind – Perhaps an insurance company who has a large marketing spend and has got your attention.

It’s possible that this is only a 3 player game but as is becoming more common with insurance brokers and insurance companies other parties enter the game. These other insurance providers generally fall into 2 categories:

1. They are likely to offer something (or have a hand) similar to either your existing insurance provider (who still has the button) or the small or big blind.

2. These new insurance providers will offer you something different. They get your attention as they have noticed an element of weakness with the other people at Business Insurance table and are planning on showing you how good they are. So how are they going to do this? Well more often than not they will raise and when it comes to Business Insurance this means they will give you more than the other people at the Business Insurance table.