The world wide web has changed the way we purchase insurance forever

These days, you can get insured for almost anything and the web has created a highly transparent and competitive market place for insurance providers. You are required by law to have certain insurance such as car insurance or medical insurance in certain jurisdictions. Other insurance not required by law is seen by most as a ‘must have’ such as travel insurance or insurance for corporate property and business assets. There is then another type of product focused mainly on the consumer market that is highly specialised such as pet insurance, wedding insurance or Insurance for adventure holidays or extreme sports. Either in the high street or on the internet, companies offer varying rates and excesses according to many different variables. There also exists a secondary market for the services of insurance brokers who shop around for products at the behest of their consumer or corporate clients. Another agency service in the insurance industry is underwriting.

Underwriting is basically where the risk to the insurer and other risks are calculated and the underwriter determines the premium and cost of the insurance or whether to insure at all. To take the example of car insurance, the underwriter would take a detailed look at a drivers accident record. In medical insurance, another example might be where the patient’s sickness record is examined. The introduction of the internet greatly helps the insurance market remain competitive and transparent but many customers are even now finding themselves uninsured when they most need it. Winter sports insurance is an excellent example of this. It is reported that over 50% of travelers to ski resorts have no insurance and although the other half do, only a quarter of them are in fact insured for skiing and snowboarding which are classified by most insurers as ‘extreme sports’ and excluded from their plans. Many European travelers also think that their E111 is adequate to get them treatment but this is simply not the case at most resorts. Another recent example of The way the insurance market is adapting is the furious competition on price between rival auto insurance companies that has been largely facilitated by the introduction of price comparison sites. We have to buy car insurance as a matter of law so everyone must purchase it. This puts price up there as the primary competitive factor.

An example of negative activity in the sector was when payment protection insurance policies (PPI’s) were discovered by the FSA to be negligent drafted or having been fraudulently marketed. This has led to a huge amount of litigation and firms actually being set up for the single purpose of acting as agents by which customers can claim back any PPI that might have been missold to them. Compare insurance online to give the greatest deal. Another questionable product is internet security insurance that promises to reimburse the customer for losses on account of cyber fraud or identity theft. However many people are unaware that the bank is in most sets of circumstances liable for such acts.