Inspection House Miami Homestead policies can be complex and some policyholders may not understand all the fees and coverages included in a policy. As a result, people may buy policies on unfavorable terms. In response to these issues, many countries have enacted detailed statutory and regulatory regimes governing every aspect of the Inspection of a home Miami Homestead business, including minimum standards for policies and the ways in which they may be advertised and sold. Inspection House Miami Homestead.
For example, most Inspection of a home Miami Homestead policies in the English language today have been carefully drafted in plain English; the industry learned the hard way that many courts will not enforce policies against insureds when the judges themselves cannot understand what the policies are saying. Typically, courts construe ambiguities in Inspection of a home Miami Homestead policies against the Inspection of a home Miami Homestead company and in favor of coverage under the policy. Inspection House Miami Homestead.
Many institutional Inspection of a home Miami Homestead purchasers buy Inspection of a home Miami Homestead through an Inspection of a home Miami Homestead broker. While on the surface it appears the broker represents the buyer (not the Inspection of a home Miami Homestead company), and typically counsels the buyer on appropriate coverage and policy limitations, in the vast majority of cases a broker’s compensation comes in the form of a commission as a percentage of the Inspection of a home Miami Homestead premium, creating a conflict of interest in that the broker’s financial interest is tilted towards encouraging an insured to purchase more Inspection of a home Miami Homestead than might be necessary at a higher price. A broker generally holds contracts with many insurers, thereby allowing the broker to “shop” the market for the best rates and coverage possible. Inspection House Miami Homestead. .
Inspection of a home Miami Homestead may also be purchased through an agent. A tied agent, working exclusively with one insurer, represents the Inspection of a home Miami Homestead company from whom the policyholder buys (while a free agent sells policies of various Inspection of a home Miami Homestead companies). Just as there is a potential conflict of interest with a broker, an agent has a different type of conflict. Because agents work directly for the Inspection of a home Miami Homestead company if there is a claim the agent may advise the client to the benefit of the Inspection of a home Miami Homestead company. Agents generally cannot offer as broad a range of selection compared to an Inspection of a home Miami Homestead broker.Inspection House Miami Homestead
An independent Inspection of a home Miami Homestead consultant advises insureds on a fee-for-service retainer, similar to an attorney, and thus offers completely independent advice, free of the financial conflict of interest of brokers or agents. However, such a consultant must still work through brokers or agents in order to secure coverage for their clients. Inspection House Miami Homestead.
Limited consumer benefits
In the United States, economists and consumer advocates generally consider Inspection of a home Miami Homestead to be worthwhile for low-probability, catastrophic losses, but not for high-probability, small losses. Because of this, consumers are advised to select high deductibles and to not insure losses which would not cause a disruption in their life. However, consumers have shown a tendency to prefer low deductibles and to prefer to insure relatively high-probability, small losses over low-probability, perhaps due to not understanding or ignoring the low-probability risk. This is associated with reduced purchasing of Inspection of a home Miami Homestead against low-probability losses and may result in increased inefficiencies from moral hazard. Inspection House Miami Homestead.
Redlining is the practice of denying Inspection of a home Miami Homestead coverage in specific geographic areas, supposedly because of a high likelihood of loss, while the alleged motivation is unlawful discrimination. Racial profiling or redlining has a long history in the property Inspection of a home Miami Homestead industry in the United States. From a review of industry underwriting and marketing materials, court documents, and research by government agencies, industry and community groups, and academics, it is clear that race has long affected and continues to affect the policies and practices of the Inspection of a home Miami Homestead industry. Inspection House Miami Homestead.
In July 2007, The Federal Trade Commission (FTC) released a report presenting the results of a study concerning credit-based Inspection of a home Miami Homestead scores in automobile Inspection of a home Miami Homestead. The study found that these scores are effective predictors of risk. It also showed that African-Americans and Hispanics are substantially overrepresented in the lowest credit scores, and substantially underrepresented in the highest, while Caucasians and Asians are more evenly spread across the scores. The credit scores were also found to predict risk within each of the ethnic groups, leading the FTC to conclude that the scoring models are not solely proxies for redlining.
The FTC indicated little data was available to evaluate the benefit of Inspection of a home Miami Homestead scores to consumers. The report was disputed by representatives of the Consumer Federation of America, the National Fair Housing Alliance, the National Consumer Law Center, and the Center for Economic Justice, for relying on data provided by the Inspection of a home Miami Homestead industry
All states have provisions in their rate regulation laws or in their fair trade practice acts that prohibit unfair discrimination, often called redlining, in setting rates and making Inspection of a home Miami Homestead available. Inspection House Miami Homestead
In determining premiums and premium rate structures, insurers consider quantifiable factors, including location, credit scores, gender, occupation, marital status, and education level. However, the use of such factors is often considered to be unfair or unlawfully discriminatory, and the reaction against this practice has in some instances led to political disputes about the ways in which insurers determine premiums and regulatory intervention to limit the factors used. Inspection House Miami Homestead.
An Inspection of a home Miami Homestead underwriter’s job is to evaluate a given risk as to the likelihood that a loss will occur. Any factor that causes a greater likelihood of loss should theoretically be charged a higher rate. This basic principle of Inspection of a home Miami Homestead must be followed if Inspection of a home Miami Homestead companies are to remain solvent. Thus, “discrimination” against (negative differential treatment of) potential insureds in the risk evaluation and premium-setting process is a necessary by-product of the fundamentals of Inspection of a home Miami Homestead underwriting. Inspection House Miami Homestead
. For instance, insurers charge older people significantly higher premiums than they charge younger people for term life Inspection of a home Miami Homestead. Older people are thus treated differently from younger people (a distinction is made, discrimination occurs). The rationale for the differential treatment goes to the heart of the risk a life insurer takes: Old people are likely to die sooner than young people, so the risk of loss (the insured’s death) is greater in any given period of time and therefore the risk premium must be higher to cover the greater risk. However, treating insureds differently when there is no actuarially sound reason for doing so is unlawful discrimination. Inspection House Miami Homestead.
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