Tips For Buying Insurance

An insurance policy is a contract between you and your insurance company. This contract is based on a promise by the insurance company to provide financial protection against specified contingencies such as death, disability, and loss or damage to property.

According to the Financial Services Regulatory Authority (FSRA) before you decide on an insurance policy, here are some things you need to consider;

  • Make sure you understand your policy before committing yourself to it. The seller has a duty to explain to you all the benefits, terms and conditions of the policy. Do not rush to sign until you know what it covers and what it doesn’t and whether it is suitable for your needs
  • Shop around. There are many insurance companies and a wide variety of coverages out there.
  • Do not take a policy or enter into any transaction with companies or individuals that are not registered with the Financial Services Regulatory Authority (FSRA). Ask them to show you their registration certificate first before you discuss any further. If they don’t have one, don’t take a policy with them
  • Consider your financial status first before committing yourself. Make sure you can afford the policy and enquire if the premiums will change n the future or not. Remember that if you stop paying your premiums, your policy may lapse and you may not get your money back depending on the type of policy
  • Don’t sign blank forms. Make sure that all the information required in the form is filled by you and don’t entertain any promises by the seller to fill in the form later. If there is missing information, don’t sign the form until all the missing and relevant information is provided
  • Make sure that all the information is true, to the best of your knowledge. Be faithful. Otherwise the insurance company may not pay your claim if it discovers that you were not faithful when filling out your form. The contract of insurance will be based on the information you have provided on the form and if it is false, the company has no obligation to pay
  • Read the policy document and make sure you understand it. If you don’t, go to the insurance company or broker for clarification. Make sure all the information and the benefits the seller presented to you in the proposal are reflected in the policy. Check if all your details are correct. Don’t take the policy until you are satisfied that it is a true reflection of what the seller presented to you
  • Keep your policy document in a safe place. As long as you pay your premiums, your policy should be in your possession. It may be required when you make a claim. Continue familiarising yourself with the terms and conditions of the policy to avoid any surprises in the future
  • Only buy insurance to maintain your existing standard of living. You don’t need insurance for events that won’t severely strain your finances. Start with your basic needs (home, auto, business), then work your way to include other needs (cyber, professional liability). You can always add coverage later for something if you change your mind. You can minimize your risk and maximize your savings by buying insurance that suit your needs today.
  • Know that you have the right to complain in case you are not satisfied with any decision of the insurance company or conduct of the seller. The procedure is that you must first lodge a complaint with the insurance company to give it a chance to respond or to resolve your complaint. Your complaint must be in writing and make sure you keep a record of all the communication with the company.
  • If you are not satisfied with the insurance company’s decision on your complaint, or the company fails to reply to you within 30 days, you can refer your complaint to the Office of The Ombudsman of Financial Services, who will investigate and make a judgement on it

(Information sourced from the Financial Services Regulatory Authority website)


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