How to choose a reliable insurance company
There is no such thing as the absolutely “most reliable” company for every situation. The choice depends on the licence, financial strength, quality of claim payments, contract terms and the right type of insurance.
Quick selection checklist
- Licence: check the company and the relevant class of insurance in the official register.
- Solvency: study compliance with the prudential standards and the margin above the minimum.
- Assets and reserves: assess not only their size but their quality, liquidity and trend.
- Claim payments: compare volume, timing, court disputes and complaints for a comparable product.
- Contract: read the risks, exclusions, deductible and claims settlement procedure carefully.
- Reinsurance: for large risks, check the protection and the reliability of the partners.
- Service: evaluate online channels, communication, inspection and handling of documents.
What really confirms reliability
A licence is a necessary but not the only condition. It is important to compare equity capital, insurance reserves, assets, liabilities, liquidity, solvency margin, profit and the quality of reinsurance over several periods. One strong indicator does not make up for weakness in the others.
For compulsory classes there is a system guaranteeing insurance payments, but its coverage is determined by law and by the guaranteed class. The Fund does not make all products and companies equivalent and does not remove the need to choose.
The current regulator
The insurance market is supervised by the Agency of the Republic of Kazakhstan for Regulation and Development of the Financial Market. Financial information and compliance with the standards are also published on the National Bank's resources. The old reference to the Financial Supervision Committee relates to the former structure.
Do not choose on price alone
For compulsory insurance the calculation is regulated by law, while for voluntary insurance a cheap policy may have a lower limit, a higher deductible or more exclusions. Compare identical cover.
Archive material from 2012
The original text is preserved in full below. It reflects the approaches and market structure of 2012; the names of bodies, the number of companies, payment deadlines and individual statements may have changed.
This is exactly the question that car owners ask most often.
Behind this question there is usually a wish to find out whether an insurance company is financially sound or not and how things stand with it in general; whether there will be problems and red tape when a payment is made or whether everything will be resolved quickly; whether the amount paid will be enough to repair the car; and whether you will have to spend a long time defending your position and dealing with court proceedings. Let us talk about exactly that.
1. How can you find out whether an insurance company is financially sound or not?
If we look at this question in terms of which insurance company has enough money for payments and which one is in a less healthy financial condition, we can say that absolutely all insurance companies are reliable and all insurance companies have enough money for insurance payments. The point is that insurance companies set up insurance reserves for every contract they conclude. A special body, the National Bank of the Republic of Kazakhstan, strictly monitors this. An insurance company has no right to spend this money on other purposes, for example advertising, salaries, the purchase of offices, furniture, equipment and so on. Therefore the risk of a refusal to pay because of an insurance company's financial insolvency is practically non-existent. Detailed information on the financial condition of insurance companies is posted on the website of the Financial Supervision Committee.
If an insurance company runs into a financial crisis, a fund guaranteeing insurance payments is provided for compulsory classes of insurance in such a case. At present, 32 insurance companies are participants of the JSC “Insurance Payments Guarantee Fund”.
2. How quickly will the insurance company decide on a payment?
On the one hand, there are set deadlines for payment. If you receive
the money from the at-fault party's insurance company, the payment must be made
within 7 working days (this question is covered in more detail in “How to Get Your Payment in 7 Days”).
On the other hand, even BEFORE the insurance contract is concluded, it is possible to form an expert view of how the insurance company will behave after a road accident. So, before buying an insurance policy, it is advisable to pay attention to the following circumstances:
1. the size of the insurance company
2. the insurance company's focus on working with private individuals
3. the terms of the contract
Large and well-known companies, as a rule, inspire greater trust among clients. If a company has managed to become one of the market leaders, it means that it has stood the test of time. However, large companies often suffer from growing pains: they are unwieldy and cannot resolve disputed issues promptly, and a complicated approval procedure with specialists and managers at different levels has to be followed. In addition, for a large company the loss of one client is not a catastrophe. It has many other clients. If you are unhappy with the work of a large company, it will easily get over it without any serious financial consequences.
Small companies are much more agile in this respect and are more inclined to fight for an individual client and to compromise. But small companies do not have the experience that large companies have behind them. So each type of company has its own pluses and minuses. How do you choose the best option?
The main thing when choosing a company is not its size, but its focus on working with a particular group of clients. If a company is interested in working with private individuals, it will set up special departments for this, train specialists and work out procedures for dealing with a large flow of citizens (so that everyone is given the necessary explanations, everyone receives enough attention and everyone can count on personal treatment).
How can you check this?
Method 1. Simply call the insurance company (you can find a list of insurance companies on the website www.polisre.kz )
It is important to note whether you were able to get through to the insurance company and how quickly you were connected with the right employee.
If the insurance company transfers you from one specialist to another because they cannot work out who is responsible for this type of insurance, if the right employee is always busy and you are asked to call back later (instead of, for example, taking down your phone number and contacting you shortly), if you do not sense any interest at the other end of the line, it is probably better not to make a decision yet about working with this company.
Method 2. Ask “awkward” questions
When a policy is issued, clients are usually told only about the benefits, the advantages and how good everything will be. This is understandable, because the job of an insurance company employee is to conclude a contract with you.
However, any contract always provides for restrictions or exemption from payment if certain conditions are not met on your side. If you have not been told about this, it does no harm to ask about it directly, in order to avoid disappointment when you receive a payment.
Ask them to explain to you:
- in which cases can a payment be refused? (let them name at least three restrictions),
- where in the policy or contract terms is this written?
- what is important to do immediately after a road accident so that no problems arise with the payment?
- within what time limits must a notice of the accident be submitted?
- why are you not warned about this when the contract is concluded?
- why are you not given written reminders? (after all, at the moment of an accident it is easy to forget everything).
It is also advisable to read the policy terms carefully, rather than simply signing where you are asked to.
Method 3. Visit the claims department
Here you can see how it all works in reality. You should be wary of:
queues (for example, one specialist is receiving clients while fifteen people are waiting in line and have not even been offered a seat),
rude treatment of clients (professionals should be able to discuss even contentious situations calmly and without shouting),
various notices that restrict your rights. For example, these: “If the insurance payment is insufficient, you must sue the at-fault party”, “Claims are accepted only until 2 p.m.”, “Inspections are carried out only on Mondays, Wednesdays and Fridays” and the like.
If you have come across exactly this kind of claims department, there is no point asking about the insurance terms. Choose a different company.
3. Which insurance companies most often cause problems?
To identify the market leaders and outsiders, various ratings and professional classifications are traditionally used. In our country there are no such ratings yet. There are official statistics on complaints filed against insurance companies. This information is available on the website www.polisre.kz.
However, when looking at these statistics, the following must be taken into account:
1) a simple count of the number of complaints does not allow an accurate conclusion to be drawn about
how an insurance company works. For example, if insurance company “AAA”
has 80 complaints and insurance company “BBB” has 115, this does not mean
that the latter works worse than the former. Company “AAA” may have only
1,000 payment cases, while company “BBB” has 20,000. So it is necessary to take into account not
absolute but relative figures, that is, not the number but the percentage
of dissatisfied clients out of the total number of claims. Unfortunately, the website www.polisre.kz
does not have such detailed information.
2) the established mentality of our citizens must also be taken into account.
When various problems arise, most people try to find ways
to reach interested parties rather than resolve the problem through official channels.
In reality there are many more complaints against insurance companies; it is just that dissatisfied clients do not report all
cases to the FSC, and many simply do not know that
such an organisation exists.
For our part, we can say that court proceedings against insurance companies continue. Most complaints are related to understating the amount of damage and unlawful refusal to pay out. Claims are usually brought by injured parties who are unhappy with the work of the at-fault party's insurance company.
Many believe that the introduction of amendments to the law on compulsory insurance should change the situation. Great hopes are pinned on so-called “direct settlement”. It works like this: you receive the money from your own insurance company, and it then deals with the at-fault party itself. The only “but”: the at-fault party must provide your company with the original of their policy, otherwise there will be no payment.
On the one hand, direct settlement should simplify the payment procedure, but on the other hand a rather unfortunate trend has emerged: owing to a significant increase in insurance prices (by 3-5 times), many drivers put off buying a policy “until later” or refuse to insure at all.
So, let us sum up briefly.
All insurance companies are financially stable and reliable.
Amendments to the law on compulsory insurance should improve the situation in the insurance market, but you cannot always be sure that the at-fault party will have an insurance policy and that no problems will arise with the payment. To avoid finding yourself in a situation where the at-fault party has no compulsory insurance policy, it is advisable to take out additional so-called “two-way insurance” (see “The At-Fault Party Is Not Insured. What to Do?” for more details)
The most frequently asked questions...
1. Why do insurance companies often assess damage poorly, and nothing happens to them for it?
Previously, insurance companies could assess damage themselves. This gave rise to many complaints and claims from clients. Now insurance companies are required to engage independent experts who hold the relevant licence and have passed special accreditation with the Financial Supervision Agency. Given these changes in legislation, one can hope for a reduction in the number of complaints related to inadequate assessment of damage.
If the insurance company nevertheless calculates an amount that does not satisfy you, you will have to prove your case in court. If the case ends successfully, the insurance company is obliged not only to pay the difference but also to compensate in full your costs of carrying out additional expert assessments.
More detailed information can be found in “If the Insurance Company Calculated Too Little.”
A modern step-by-step approach
- Determine the class of insurance and the risks you need.
- Select several licensed insurers.
- Compare financial indicators and reporting.
- Request identical cover options.
- Read the rules and the draft contract.
- Check the procedure for notifying a claim.
- Keep the policy, the receipt and the claims contact details.
Conclusion
A reliable insurance company is not necessarily the largest or the cheapest. It is a licensed insurer with sufficient capital and reserves, transparent reporting, a clear contract and a stable record of claim payments. For a long-term contract, the analysis must be especially thorough.
This material is for information purposes. Financial condition and licences may change; check the information directly before concluding a contract.