Health Insurance Basics

By the State of Oregon Insurance Division

Buying insurance should begin with the basics: a licensed agent, a policy, and a company that meet your coverage and service needs.

How do I choose a trustworthy insurance agent?

Your agent can be as important as your doctor or lawyer. It's best to choose carefully and take time with the decision.

* First, make sure your agent is licensed. Call the Insurance Division's Agent Licensing Unit at (503) 947-7981 if you are not sure.

* Second, ask around. You may want to find out if your local Better Business Bureau has received complaints about a particular agent. Ask the agent for recommendations from some other clients.

* Third, ask agents what kind of service you can expect from them. Will they regularly evaluate your insurance needs? Will they help when it's time to make a claim?

* Finally, remember who your agent works for. Agents work on a commission basis for insurance companies. Legally, they do not work for consumers.

How do I decide which company is right for me?
Do I base my decision on benefits or premium?

While the price you pay is important, buying the cheapest policy is not necessarily a good idea. Insurance that sounds too good to be true probably is too good to be true! Then again, looking only at benefits could result in paying a higher than necessary premium. You should consider all of the following when choosing a company and a policy:

• Premium
• Benefits, including any coverage exclusions or limits
• Service (What's involved in making a claim?)
• Renewability (How easily can you be canceled?)
• Financial strength and reliability of the company
• Company management philosophy toward service, claims, and financial management
• How long the company has been in business offering similar policies

The Oregon Insurance Division has several brochures to help you choose a company. Some of these brochures even compare premiums and benefits.

How do I know if a company will be responsive when I have a claim?

There are two aspects to a company's responsiveness to claims: commitment to customer service and financial ability to pay claims.

It's important to ask questions about the claims process before you buy a policy. For example, some companies may not need any paperwork to pay a claim. For others, the process can be much more time consuming. Another way to evaluate a company's service record is the Insurance Division report called Oregon Insurance Complaints. Part One of the report ranks insurance companies based on the number of complaints consumers make. Most complaints the Insurance Division receives are about how companies handle claims.