Insurance for home-based businesses

As a home-based business you need to make sure you have the correct level of insurance to protect yourself. One of the most common mistakes made by home-based business operators is to assume that home and contents insurance covers their business risk - in many cases it doesn’t.

Insurances to consider are:

• Public liability cover for persons visiting your business at home (e.g. customers and suppliers)
• Workers compensation for any employees working from your home
• Fire, storm and theft cover for the loss of any stock and equipment
• Professional indemnity insurance if you're in a service industry, especially if you're contracting to government
• Personal accident or illness
• Costs arising from interruption to your business
• Marine policy if you send products via freight carriers or post.

It’s important to note that many policies don't cover tools of trade, office furniture or computer equipment used for your business, unless you've specifically advised your insurer and they've agreed to cover you.

Life Insurance

Life Insurance Direct

Life Insurance Quotes & Information

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Length of Time of Life Insurance Policy

The longer your policy remains in force, the more likely it is that the company will pay a claim, therefore the more expensive it is. That is why whole life insurance policies have the highest premium - it's insurance for your whole life, no matter when you pass on. When you have a whole life policy you have assurance that you will have coverage as long as you live. As long as you pay your premium, the company will guarantee that benefits will be paid to your heirs. That is why a 5 or 10-year term life insurance policy is the least expensive. The company is less likely to pay a claim on that term life policy.

AUTO INSURANCE INFORMATION

AUTO INSURANCE INFORMATION

If you own a car, auto insurance is not just an option—it is a legal necessity. And you wouldn't want it any other way. If you are involved in an accident or have your car stolen, owning the right kind of auto insurance can help to ease a difficult situation.

What is auto insurance?

Auto insurance protects you against financial loss if you have an accident. It is a contract between you and the insurance company. You agree to pay the premium and the insurance company agrees to pay your losses as defined in your policy. Auto insurance provides property, liability and medical coverage: Property coverage pays for damage to or theft of your car. Liability coverage pays for your legal responsibility to others for bodily injury or property damage. Medical coverage pays for the cost of treating injuries, rehabilitation and sometimes lost wages and funeral expenses. An auto insurance policy is comprised of six different kinds of coverage. Most states require you to buy some, but not all, of these coverages. If you're financing a car, your lender may also have requirements. Most auto policies are for six months to a year. Your insurance company should notify you by mail when it’s time to renew the policy and to pay your premium.

Training and Advancement

Training and Advancement

A few jobs in the insurance industry, especially in office and administrative support occupations, require no more than a high school diploma. However, employers prefer to hire workers with a college education for most jobs, including sales, managerial, and professional jobs. When specialized training is required, it usually is obtained on the job or through independent study during work or after-work hours. Many insurance companies expect their employees to take continuing education courses to improve their people skills and their knowledge of the industry. Opportunities for advancement are relatively good in the insurance industry.

Office and administrative support occupations. Graduation from high school or a 2-year postsecondary business program is adequate preparation for most beginning office and administrative support jobs. Courses in word processing and business math are assets, and the ability to operate computers is essential. On-the-job training usually is provided for clerical jobs such as customer service representatives. Because representatives in call centers must be knowledgeable about insurance products in order to provide advice to clients, more States are requiring customer service representatives to become licensed. Several years of experience and training can help beginners advance to higher paying positions. Office and administrative support workers may also advance to higher paying claims adjusting positions and entry-level underwriting jobs.

Management, business, and financial operations occupations. Management, business, and financial jobs require the same college training as similar jobs in other industries. Managerial positions usually are filled by promoting college-educated employees from within the company. However, some companies prefer to hire liberal arts graduates at a lower cost, and many insurers send them to company schools or enroll them in outside institutes for professional training. A master’s degree, particularly in business administration or a related field, is an asset for advancement into higher levels of management.

For beginning underwriting jobs, many insurance companies prefer college graduates who have a degree in business administration or a related field. As an underwriter’s career develops, it becomes beneficial to earn one of the voluntary professional certifications in underwriting. For example, the National Association of Health Underwriters offers two certification programs: the Registered Health Underwriter (RHU) designation and the Registered Employee Benefits Consultant (REBC) designation.

The American Institute for Chartered Property-Casualty Underwriters (AICPU) offers the CPCU program, which includes courses covering a broad range of insurance, risk management, and general business topics involving both personal and commercial loss exposures. Earning the CPCU designation requires passing 8 exams, meeting a requirement of at least three years of insurance experience, and abiding by the AICPU’s and CPCU Society’s code of professional ethics. In conjunction with the Insurance Institute of America, the AICPCU offers 22 insurance-related educational programs, including claims, underwriting, risk management, and reinsurance.

In almost every State, those working as a claims examiner or adjuster must obtain a license. Licensing requirements for these workers vary by State and can include prelicensing education or passing a licensing exam. In some cases, professional designations may be substituted for the exam requirement. Separate or additional requirements may apply to public adjusters. For example, some States may require public adjusters to file a surety bond. Often, claims adjusters working for companies can work under the company license and not need to become licensed themselves. Most companies prefer to hire college graduates and those with previous experience or who have obtained licensure for claims adjuster and examiner positions. No specific college major is required, although most workers in these positions have a business, accounting, engineering, legal, or medical background. In addition, many adjusters and examiners choose to pursue certain certifications and designations to distinguish themselves. Many State licenses and professional designations require continuing education for renewal. Continuing education is important because adjusters and examiners must be knowledgeable about changes in the laws, recent court decisions, and new medical procedures.

Auto damage appraisers typically begin as auto body repairers and then are hired by insurance companies or independent adjusting firms. Most companies prefer auto damage appraisers to have formal training, and many vocational colleges offer 2-year programs on how to estimate and repair damaged vehicles. Some States require them to be licensed, and certification may be required or preferred. Computer skills also are an important qualification for many auto damage appraiser positions. As with adjusters and examiners, continuing education is important for appraisers, because many new car models and repair techniques are introduced each year.

Licensing requirements to become an insurance investigator may vary among States. Most insurance companies prefer to hire former law enforcement detectives or private investigators as insurance investigators. Many experienced claims adjusters or examiners also can become investigators. Most employers look for individuals with ingenuity and who are persistent and assertive. Investigators must not be afraid of confrontation, should communicate well, and should be able to think on their feet. Good interviewing and interrogation skills also are important and usually are developed in earlier careers in law enforcement.

Sales and related occupations. Although some employers hire high school graduates with potential or proven sales ability for entry-level sales positions, most prefer to hire college graduates.

All insurance sales agents must obtain licenses in the States in which they plan to sell insurance. In most States, licenses are issued only to applicants who complete specified courses and pass written examinations covering insurance fundamentals and State insurance laws. New agents receive training from their employer, either at work or at the insurance company’s home office. Sometimes, entry-level employees attend company-sponsored classes to prepare for examinations. The National Alliance for Insurance Education and Research offers a wide variety of courses in health, life, and property and casualty insurance for independent insurance agents. Others study on their own and, as on-the-job training, accompany experienced agents when they meet with prospective clients. After obtaining a license, agents must earn continuing education credits throughout their careers in order to remain licensed insurance sales agents.

Insurance sales agents wishing to sell securities and other financial products must meet State licensing requirements in these areas. Specifically, they must pass an additional examination—either the Series 6 or Series 7 licensing exam, both of which are administered by the Financial Industry Regulatory Authority (FINRA). The Series 6 exam is for individuals who wish to sell only mutual funds and variable annuities; the Series 7 exam is the main FINRA series license and qualifies agents as general securities representatives. To demonstrate further competency in financial planning, many agents also find it worthwhile to obtain a certified financial planner (CFP) or chartered financial consultant (ChFC) designation.

Sales workers may advance by handling greater numbers of accounts and more complex commercial insurance policies. They may also choose to start an independent insurance agency. Many also obtain related designations such as the CPCU underwriting designation, offered by the AICPCU.

Professional and related occupations. For actuarial jobs, companies prefer candidates to have degrees in actuarial science, mathematics, or statistics. However, candidates with degrees in business, finance, or economics are becoming more common. Actuaries must pass a series of national examinations to become fully qualified. Completion of all the exams takes from 5 to 10 years. Some of the exams may be taken while an individual is in college, but most require extensive home study. Many companies grant study time to their actuarial students to prepare for the exams.

Occupations in the Industry

Occupations in the Industry

About 44 percent of insurance workers are in office and administrative support jobs such as those found in every industry (table 1). Many office and administrative support positions in the insurance industry, however, require skills and knowledge unique to the industry. About 29 percent of insurance workers are in management or business and financial operations occupations. About 16 percent of wage and salary employees in the industry are sales workers, selling policies to individuals and businesses. Several others are employed in computer and mathematical science occupations.

Office and administrative support occupations. Office and administrative support occupations in this industry include secretaries, typists, word processors, bookkeepers, and other clerical workers. Secretaries and administrative assistants perform routine clerical and administrative functions such as drafting correspondence, scheduling appointments, organizing and maintaining paper and electronic files, or providing information to callers. Bookkeeping, accounting, and auditing clerks handle all financial transactions and recordkeeping for an insurance company. They compute, classify, update, and record numerical data to keep financial records complete and accurate. Insurance claims and policy processing clerks process new policies, modifications to existing policies, and claims forms. They review applications for completeness, compile data on policy changes, and verify the accuracy of insurance company records. Customer service representatives have duties similar to insurance claims and policy processing clerks, except they work directly with customers by processing insurance policy applications, changes, and cancellations over the phone. They may also process claims and sell new policies to existing clients. These workers recently are taking on increased responsibilities in insurance offices, such as handling most of the continuing contact with clients. A growing number of customer service representatives work in call centers that are open 24 hours a day, 7 days a week, where they answer clients’ questions, update policy information, and provide potential clients with information regarding the types of policies the company issues.

Management, business, and financial operations occupations. Top executives direct the operations of an independent insurance agency, brokerage, or a large insurance carrier. Marketing managers direct carriers’ development of new types of policies that might appeal to the public and strategies for selling them to customers. Sales managers direct the activities of the sales workers in local sales offices of insurance carriers and independent agencies. They sell insurance products, work with clients, and supervise staff. Other managers who work in their companies' home offices are in charge of functions such as actuarial calculations, policy issuance, accounting, and investments.

Claims adjusters, appraisers, examiners, and investigators decide whether claims are covered by the customer’s policy, estimate and confirm payment, and, when necessary, investigate the circumstances surrounding a claim. Claims adjusters work for property and liability insurance carriers or for independent adjusting firms. They inspect property damage, estimate how much it will cost to repair, and determine the extent of the insurance company’s liability; in some cases, they may help the claimant receive assistance quickly in order to prevent further damage and begin repairs. Adjusters plan and schedule the work required to process claims, which may include interviewing the claimant and witnesses and consulting police and hospital records. In some property-casualty companies, claims adjusters are called claims examiners, but in other companies, a claims examiner’s primary job is to review claims to ensure that proper guidelines have been followed. Only occasionally—especially when disasters suddenly increase the volume of claims—do these examiners aid adjusters with complicated claims.

In the offices of life and health insurance carriers, claims examiners are the counterparts of the claims adjuster who works in a property and casualty insurance firm. Examiners in the health insurance carriers review health-related claims to see whether the costs are reasonable based on the diagnosis. Examiners check claim applications for completeness and accuracy, interview medical specialists, and consult policy files to verify information on a claim. Claims examiners in the life insurance carriers review causes of death and also may review new applications for life insurance to make sure that the applicants have no serious illnesses that would prevent them from qualifying for insurance.

Insurance investigators handle claims in which companies suspect fraudulent or criminal activity, such as suspicious fires, questionable workers’ disability claims, difficult-to-explain accidents, and dubious medical treatment. Investigators usually perform database searches on suspects to determine whether they have a history of attempted or successful insurance fraud. Then, the investigators may visit claimants and witnesses to obtain a recorded statement, take photographs, inspect facilities, and conduct surveillance on suspects. Investigators often consult with legal counsel and are sometimes called to testify as expert witnesses in court cases.

Auto damage appraisers usually are hired by insurance companies and independent adjusting firms to inspect the damage to a motor vehicle after an accident and to provide unbiased estimates of repair cost. Claims adjusters and auto damage appraisers can work for insurance companies, or they can be independent or public adjusters. Insurance companies hire independent adjusters to represent their interests while assisting the insured, whereas public adjusters are hired to represent the insured’s interests against insurance carriers.

Management analysts, often called loss control representatives in the insurance industry, assess various risks faced by insurance companies. These workers inspect the business operations of insurance applicants, analyze historical data regarding workplace injuries and automobile accidents, and assess the potential for natural hazards, dangerous business practices, and unsafe workplace conditions that may result in injuries or catastrophic physical and financial loss. They might then recommend, for example, that a factory add safety equipment, that a house be reinforced to withstand environmental catastrophes, or that incentives be implemented to encourage automobile owners to install air bags in their cars or take more effective measures to prevent theft. Because the changes they recommend can greatly reduce the probability of loss, loss control representatives are increasingly important to both insurance companies and the insured.

Underwriting is another important management and business and financial occupation in insurance. Underwriters evaluate insurance applications to determine the risk involved in issuing a policy. They decide whether to accept or reject an application, and they determine the appropriate premium for each policy.

Sales and related occupations. Insurance sales agents, also referred to as producers, may work as exclusive agents, or captive agents, selling for one company, or as independent agents selling for several companies. Through regular contact with clients, agents are able to update coverage, assist with claims, ensure customer satisfaction, and obtain referrals. Insurance sales agents may sell many types of insurance, including life, annuities, property-casualty, health, and disability insurance. Many insurance sales agents are involved in “cross-selling” or “total account development,” which means that, besides offering insurance, they have become licensed to sell mutual funds, annuities, and other securities. These agents usually find their own customers and ensure that the policies sold meet the specific needs of their policyholders.

Professional and related occupations. The insurance industry employs relatively few people in professional and related occupations, but they are essential to company operations. For example, insurance companies’ lawyers defend clients who are sued, especially when large claims may be involved. These lawyers also review regulations and policy contracts. Nurses and other medical professionals advise clients on wellness issues and on medical procedures covered by the company’s managed-care plan. Computer systems analysts, computer programmers, and computer support specialists are needed to analyze, design, develop, and program the systems that support the day-to-day operations of the insurance company.

Actuaries represent a relatively small proportion of employment in the insurance industry, but they are vital to the industry’s profitability. Actuaries study the probability of an insured loss and determine premium rates. They must set the rates so that there is a high probability that premiums paid by customers will cover claims, but not so high that their company loses business to competitors.

Table 1. Employment of wage and salary workers in insurance by occupation, 2006 and projected change, 2006-2016.
(Employment in thousands)

Occupation	Employment, 2006		Percent change, 2006-16
	Number	Percent
All occupations	2,316	100.0	7.4
Management, business, and financial occupations	661	28.6	8.3
General and operations managers	41	1.8	-1.9
Marketing and sales managers	20	0.9	7.2
Computer and information systems managers	14	0.6	5.9
Financial managers	24	1.0	6.6
Claims adjusters, examiners, and investigators	218	9.4	10.8
Insurance appraisers, auto damage	12	0.5	12.0
Human resources, training, and labor relations specialists	28	1.2	10.9
Management analysts	29	1.2	5.4
Accountants and auditors	40	1.7	7.8
Financial analysts	16	0.7	16.9
Insurance underwriters	91	3.9	5.6
Professional and related occupations	258	11.2	8.6
Computer programmers	21	0.9	-15.1
Computer software engineers	28	1.2	24.7
Computer support specialists	19	0.8	6.8
Computer systems analysts	33	1.4	15.5
Actuaries	11	0.5	5.4
Market research analysts	12	0.5	6.5
Lawyers	12	0.5	5.6
Title examiners, abstractors, and searchers	23	1.0	-5.5
Registered nurses	25	1.1	6.2
Sales and related occupations	367	15.8	14.4
First-line supervisors/managers of non-retail sales workers	18	0.8	3.8
Insurance sales agents	313	13.5	15.7
Office and administrative support occupations	1,009	43.6	4.0
First-line supervisors/managers of office and administrative support workers	62	2.7	-6.0
Billing and posting clerks and machine operators	18	0.8	-2.5
Bookkeeping, accounting, and auditing clerks	47	2.0	8.9
Customer service representatives	266	11.5	19.2
File clerks	15	0.7	-45.3
Receptionists and information clerks	24	1.0	10.0
Executive secretaries and administrative assistants	57	2.4	8.2
Secretaries, except legal, medical, and executive	62	2.7	-1.5
Data entry keyers	22	0.9	-13.5
Insurance claims and policy processing clerks	222	9.6	-2.6
Mail clerks and mail machine operators, except postal service	14	0.6	-21.0
Office clerks, general	106	4.6	7.8
Note: Columns may not add to totals due to omission of occupations with small employment

Employment

Employment

The insurance industry had about 2.3 million wage and salary jobs in 2006. Insurance carriers accounted for 62 percent of jobs, while insurance agencies, brokerages, and providers of other insurance-related services accounted for 38 percent of jobs.

The majority of establishments in the insurance industry were small; however, a few large establishments accounted for many of the jobs in this industry. Insurance carriers tend to be large establishments, often employing 250 or more workers, whereas agencies and brokerages tend to be much smaller, frequently employing fewer than 20 workers (chart 1).

Many insurance carriers’ home and regional offices are situated near large urban centers. Insurance workers who deal directly with the public are located throughout the country. Almost all of those working in sales work out of local company offices or independent agencies. Many others in the industry work for independent firms in small cities and towns throughout the country.

Working Conditions

Working Conditions

Hours. Many workers in the insurance industry—especially those in administrative support positions—work a 5-day, 40-hour week. Those in executive and managerial occupations often put in more than 40 hours. There are several occupations in the insurance industry where workers may work irregular hours outside of office settings. Those working in sales jobs need to be available for their clients at all times. This accommodation may result in these individuals working 50 to 60 hours per week. Also, call centers operate 24 hours a day, 7 days a week, so some of their employees must work evening and weekend shifts. The irregular business hours in the insurance industry provide some workers with the opportunity for part-time work. Part-time employees make up 8 percent of the workforce.

Work environment. Insurance employees working in sales jobs often visit prospective and existing customers’ homes and places of business to market new products and provide services. Others working in the industry may need to frequently leave the office to inspect damaged property, and at times can be away from home for days, traveling to the scene of a disaster—such as a tornado, flood, or hurricane—to work with affected policyholders and government officials.

A small, but increasing, number of insurance employees spend most of their time on the telephone working in call centers, answering questions and providing information to prospective clients or current policyholders. These jobs may include selling insurance, taking claims information, or answering medical questions.

As would be expected in an industry dominated by office and sales employees, the incidence of occupational injuries and illnesses among insurance workers is low. In 2006, only 1.3 cases per 100 full-time workers were reported among insurance carriers, while just 0.7 cases per 100 full-time workers were reported among agents and brokers. These figures compare with an average of 4.4 for all private industry.

Nature of the Industry

Nature of the Industry

Goods and services. The insurance industry provides protection against financial losses resulting from a variety of perils. By purchasing insurance policies, individuals and businesses can receive reimbursement for losses due to car accidents, theft of property, and fire and storm damage; medical expenses; and loss of income due to disability or death.

Industry organization. The insurance industry consists mainly of insurance carriers (or insurers) and insurance agencies and brokerages. In general, insurance carriers are large companies that provide insurance and assume the risks covered by the policy. Insurance agencies and brokerages sell insurance policies for the carriers. While some of these establishments are directly affiliated with a particular insurer and sell only that carrier’s policies, many are independent and are thus free to market the policies of a variety of insurance carriers. In addition to supporting these two primary components, the insurance industry includes establishments that provide other insurance-related services, such as claims adjustment or third-party administration of insurance and pension funds.

These other insurance industry establishments also include a number of independent organizations that provide a wide array of insurance-related services to carriers and their clients. One such service is the processing of claims forms for medical practitioners. Other services include loss prevention and risk management. Also, insurance companies sometimes hire independent claims adjusters to investigate accidents and claims for property damage and to assign a dollar estimate to the claim.

Insurance carriers assume the risk associated with annuities and insurance policies and assign premiums to be paid for the policies. In the policy, the carrier states the length and conditions of the agreement, exactly which losses it will provide compensation for, and how much will be awarded. The premium charged for the policy is based primarily on the amount to be awarded in case of loss, as well as the likelihood that the insurance carrier will actually have to pay. In order to be able to compensate policyholders for their losses, insurance companies invest the money they receive in premiums, building up a portfolio of financial assets and income-producing real estate which can then be used to pay off any future claims that may be brought. There are two basic types of insurance carriers: primary and reinsurance. Primary carriers are responsible for the initial underwriting of insurance policies and annuities, while reinsurance carriers assume all or part of the risk associated with the existing insurance policies originally underwritten by other insurance carriers.

Primary insurance carriers offer a variety of insurance policies. Life insurance provides financial protection to beneficiaries—usually spouses and dependent children—upon the death of the insured. Disability insurance supplies a preset income to an insured person who is unable to work due to injury or illness, and health insurance pays the expenses resulting from accidents and illness. An annuity (a contract or a group of contracts that furnishes a periodic income at regular intervals for a specified period) provides a steady income during retirement for the remainder of one’s life. Property-casualty insurance protects against loss or damage to property resulting from hazards such as fire, theft, and natural disasters. Liability insurance shields policyholders from financial responsibility for injuries to others or for damage to other people’s property. Most policies, such as automobile and homeowner’s insurance, combine both property-casualty and liability coverage. Companies that underwrite this kind of insurance are called property-casualty carriers.

Some insurance policies cover groups of people, ranging from a few to thousands of individuals. These policies usually are issued to employers for the benefit of their employees or to unions, professional associations, or other membership organizations for the benefit of their members. Among the most common policies of this nature are group life and health plans. Insurance carriers also underwrite a variety of specialized types of insurance, such as real-estate title insurance, employee surety and fidelity bonding, and medical malpractice insurance.

Other organizations in the industry are formed by groups of insurance companies, to perform functions that would result in a duplication of effort if each company carried them out individually. For example, service organizations are supported by insurance companies to provide loss statistics, which the companies use to set their rates.

Recent developments. Congressional legislation now allows insurance carriers and other financial institutions, such as banks and securities firms, to sell one another’s products. More insurance carriers now sell financial products such as securities, mutual funds, and various retirement plans. This approach is most common in life insurance companies that already sold annuities, but property and casualty companies also are increasingly selling a wider range of financial products. In order to expand into one another’s markets, insurance carriers, banks, and securities firms have engaged in numerous mergers, allowing the merging companies access to each other's client base and geographical markets.

Insurance carriers have discovered that the Internet can be a powerful tool for reaching potential and existing customers. Most carriers use the Internet simply to post company information, such as sales brochures and product information, financial statements, and a list of local agents. However, an increasing number of carriers are starting to expand their Web sites to enable customers to access online account and billing information, and some carriers even allow claims to be submitted online. Many carriers also provide insurance quotes online based on the information submitted by customers on their Internet sites. In fact, some carriers will allow customers to purchase policies through the Internet without ever speaking to a live agent.

In addition to individual carrier-sponsored Internet sites, several “lead-generating” sites have emerged. These sites allow potential customers to input information about their insurance policy needs. For a fee, the sites forward customer information to a number of insurance companies, which review the information and, if they decide to take on the policy, contact the customer with an offer. This practice gives consumers the freedom to accept the best rate.