A consumer armed with a computer can find out a great deal about
which insurance companies offer the most reliable service. You just
have to know where to look online.
David Cohen, CEO of Investigative Resources of Texas, says you
can't be too thorough.
"You have to look at
," says Cohen, a longtime private investigator who has investigated
insurance claims. "You can't just say, 'They have the best
[financial] rating.' If you do due diligence, you will find a
difference in responsiveness and different reputations for paying"
The type of information you seek will depend, in part, on your
insurance needs. If you live in tornado country, you should pay
attention to how responsive insurance companies are when it comes
to natural disasters. Cohen says not all carriers investigate storm
damage at the same speed. "Some are better when responding to a
If you are buying a life insurance policy to protect your
children, you'll want to make sure that the company you choose is
financially sound enough to be in business decades from now. Edie
Mermelstein, a Southern California attorney who handles insurance
and consumer issues, says too many people base their insurance
decisions on TV commercials. They may be entertaining, but they
don't provide relevant information, she says.
"The insurers out there are not going to advertise their
weaknesses," she says.
Amy Bach, executive director of the United Policyholders
consumer group, says there is too much emphasis on buying cheap
policies rather than insurance that will meet your needs when you
make a claim.
"We want people to investigate who has the best quality
protection for the best prices and who has the best reputation for
consumer service and satisfaction," she says. "If the price seems
too good to be true, it probably is."
Here are eight places online where you can investigate insurance
1. Check out your state insurance department
This should be at the top of your list. Because state
departments of insurance regulate the industry, they are excellent
sources for finding out if there have been complaints filed against
companies. They also are good sources for licensing
State insurance regulators often can tell you whether an insurer
has requested permission to raise rates. The state of California
insurance rate filings
list that includes public notices of rate hike requests and
"Anytime an insurer files for new rates, those are public
documents available on the website," says Ioannis Kazanis, a
spokesperson for the California Department of Insurance (DOI).
your state's department of insurance website
, check to see if it offers "complaint ratio" reports. Does the
insurer have more complaints than average? The Michigan Department
of Licensing and Regulatory Affairs provides an
overview of complaints against insurers
You also can search for adverse insurance market conduct reports
and enforcement actions. States regularly issue reports when they
respond to complaints about insurance companies. For example, the
New Jersey Department of Banking and Insurance posts
market conduct examination reports
. In Colorado, the Department of Regulatory Agencies posts
enforcement actions against insurers.
2. Consult Standard & Poor's ratings to gauge your
insurer's financial strength
Insure.com offers free insurance company ratings from Standard
& Poor's. S&P has assessed the financial strength of
insurance companies since 1971. You can tap into reports and
ratings on more than 3,000 insurance entities in approximately 70
The top S&P rating is "AAA." If the rating drops below
"BBB," be very cautious. An insurer rated "BB" or less is regarded
as having financial problems that may outweigh its strengths.
Standard & Poor's ratings definitions contain a thorough
explanation of how to read the ratings.
3. Check A.M. Best's ratings
If you want to be thorough, checking one financial rating
service may not be enough. Steven Rambam, a private investigator
for more than three decades and the director of Pallorium Inc.,
uses A.M. Best to gauge the financial strength of insurance
companies. A.M. Best specializes in rating insurers by considering
balance sheet strength, performance and business profiles. You must
register to log in, but there is no charge for viewing files
online. A.M. Best's website has its own explanation of financial
4. Find out if anyone has filed a lawsuit against your
Rambam recommends a visit to the Public Access to Court
Electronic Records (PACER) website to check for insurance industry
lawsuits filed in federal court. "See if things got bad enough that
consumers had to sue to get the coverage that they contracted for,"
PACER.com is maintained by the Administrative Office of the
United States Courts. For electronic access to federal court data,
the fee is 10 cents per page. The PACER website contains a full
list of fees.
When you're done checking PACER, Cohen says you should check for
lawsuits that may have originated at the local level. States
typically maintain their own judicial websites. For example, in
Ohio you can search court records for matters that have come before
Superior Court or the state Supreme Court.
5. Review Insure.com's customer satisfaction ratings
Insure.com offers in-depth insurance customer satisfaction
ratings for large auto, home, life and health insurers. We used
five measurements of satisfaction, including claims service and
customer service. You can sort the lists by the measurement most
important to you. We also asked whether customers would recommend
their insurers and whether they intend to renew their policies.
6. Look up the 'rage sites'
The advice of so-called "rage sites" created by disgruntled
customers may not be scientific and their reputations for accuracy
are mixed. Nevertheless, investigators Rambam and Cohen say you
should not overlook them. There are many from which to choose. Just
Google words like "insurance" and "ripoff." Of course, don't accept
everything you read without doing your own research.
"Now, not all of these rants are legitimate, but you will have
leads that you can follow," says Rambam. "If someone says 'I
purchased disability insurance, I fell down a flight of stairs and
they did everything they could to avoid settling with me,' send
this person an email. Ask 'Did you file a complaint? Was it upheld
by the DOI [department of insurance]? Did you have to sue?'"
7. Visit your state attorney general's website
Rambam says you shouldn't overlook your state attorney general's
website. Attorneys general, who must stand for election, frequently
publicize their efforts on behalf of the public, and that includes
actions they take against insurance companies.
For example, recently New Mexico Attorney General Gary King
issued a news release in which he opposed a request for a health
insurance rate increase.
"Anytime an AG office goes after an insurance carrier for any
reason, they issue a news release," he says. "See if [an insurer
has] ever been spanked or [is] in the process of being spanked by
your state AG."