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In fact, the criteria for good performance insurance can be seen from a number of benchmarks commonly used to rank the performance of insurance companies. From there compiled a list of insurance companies that perform well.
10 Criteria for Assessing Good Performing Insurance Companies #
According to InfoBank’s assessment in InfoBank’s version of Rating 123 Insurance, the following are 10 assessment criteria for insurance companies categorized as having good performance.
RBC: How Healthy is the Insurance Company? #
Risk-Based Capital (RBC) is used to measure how secure an insurance company is or how healthy the insurance company is. The health or financial condition of the insurance company is reflected in the size of the RBC ratio. A healthy insurance company usually has a large RBC ratio.
What is the Liquidity Ratio of the Insurance Company? #
How capable the insurance company is to manage finances properly and how much it is able to meet obligations such as debt depends on the liquidity ratio. The high liquidity ratio indicates that financial conditions are in good condition.
How Much is the Guarantee Fund to Protect Insurance Customers? #
Guarantee Fund is an insurance company asset that is used as the last guarantee in order to protect the interests of policyholders, the insured, or participants. Regarding this Guarantee Fund, usually, there are regulations made in each country regarding the Financial Health of Insurance Companies and Reinsurance Companies.
Investment / Technical Reserves Plus Claims Payable #
Used to determine the company’s ability to pay its obligations to policyholders in the long run. The 100% figure becomes a benchmark for knowing investment / technical reserves plus claims debt. Equal to or more than 100% is included in the best category.
Fixed Assets / Own Capital #
The extent to which the efficiency of the insurance company can be seen from the insurance company’s fixed assets. No more than 25% is the best number for a well-performing insurance company.
Change in Gross Premium #
To find out the company’s ability to maximize premiums, find out how the insurance company’s gross premiums change. If the insurance company scores 33% or more, the insurance company is categorized as the best insurance company.
Net Premium Income on Own Capital #
How is the strength of your own capital against your own dependents in an insurance company? Less or equal to 300% is the standard of the best insurance companies.
Net Investment Income to Average Investment #
Find out whether the net investment income against the average investment is equal to or greater than the average investment interest rate or not. If it is equal or greater, it means that the insurance company is one of the best insurance companies.
Net Claim Expense Ratio #
To find a good performing insurance company, the ratio of this one must be equal to or less than 100%.
The ratio of Profit (Loss) Before Tax to Average Own Capital #
Used to measure the ability of own capital to generate profits, the best standard must be equal to or more than the average investment interest rate.
The following 4 things can also be used as measurements #
Sometimes prospective customers do not have enough time or knowledge to research data so they are quickly tempted by various attractive offers provided by the insurance company. So, to minimize unwanted things in choosing a car insurance company. The following are 4 criteria for a good car insurance company in addition to the 10 criteria above.
How Long Has The Insurance Company Been Established? #
The length of time an insurance company has been established can be an easy indicator to examine the performance of an insurance company. Car insurance companies that have only been established for less than a year or have only been one year cannot be ascertained in the future. Because the insurance business is a risky business. If you are inexperienced, the company could go bankrupt.
Have a Good Reputation #
Reputation cannot be built in a short time. An insurance company with a good reputation on a sustainable basis needs to maintain and improve its performance. To get a car insurance company that has a good reputation, you can find information from various sources, be it from social media or from people around you.
Have Many Partner Workshops #
Workshop partners are the spearhead of car insurance services. The more partner workshops, the better the service because it is easier for vehicle owners to reach. Customers will feel comfortable without being afraid when they want to travel.
With so many partner workshops available, if something untoward happens to your car on the road, you just have to call the relevant party and wait until the car repair is complete.
Affordable premiums #
A good insurance program doesn’t have to be expensive. The performance of a good car insurance company can also be seen from the premiums offered. If you’re careful, a good car insurance company can offer affordable and good quality premiums.
Each company offers a different premium price. Adjust the premium offered with the budget you have. A good car insurance company will certainly help you get the right premium.
Consider The Following Before Buying Car Insurance #
Before you buy a car insurance product, pay attention to the following points.
- Adjust as needed. For example, the All Risk type of insurance is needed if the car risk is very high. Beyond that, the type of TLO can be considered.
- Adjust your ability when you want to choose insurance. Ideally, the amount of insurance premium is between 10-15% of income. Payment can be made annually, semester, quarterly, or monthly.
- Buy insurance products from insurance companies that are clearly registered in your country and carried out by licensed marketers.
- Learn all the benefits of the product purchased and the claim procedure clearly so that it is easy for the administrative process in the future.
- Don’t be tempted by the talk of marketers. If necessary, ask for a sample copy of the product policy you want to buy to study before deciding to buy.
- Always be open and straightforward to marketers in providing the information they need to avoid being rejected during claims.
- Make sure to reread the terms of the policy when the policy is finished. Is it in accordance with the agreement during the insurance purchase process or not?
Apart from the above, you also don’t get caught easily in the following car insurance trap.
- Don’t be easily tempted by marketing language.
- Don’t be tempted by the price game.
The Conclusion #
See Also the Financial Performance and the Network Service
Some of the criteria above can be taken into consideration in choosing the right insurance product. Viewing the performance of an insurance company can be from two sides, namely financial performance and services and networks owned.
Before choosing, you should consider carefully so that the results are good and as you wish. After getting the best insurance company, make sure the product you want to take fits your needs and you understand the administration set by the insurance company.
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