ILLINOIS RESIDENTS URGED TO DOUBLE-CHECK THEIR INSURANCE COVERAGE DURING GET SMART WEEK

Springfield, IL - Illinois Director of Insurance Nat Shapo is urging Illinois consumers to review and evaluate their insurance coverage during Get Smart Week, January 14-18, 2002. Get Smart Week is a national consumer education program being sponsored by the National Association of Insurance Commissioners (NAIC) in conjunction with state insurance departments across the country.

According to a recent NAIC survey, 67 percent of Americans believe they have about the right amount of insurance coverage, but only 28 percent say they understand the details of the coverage "very well."

"During Get Smart Week, we are urging consumers to recognize that when it comes to insurance, knowledge is their best policy," Shapo says. "Consumers should begin by reviewing their insurance coverage and evaluating whether they have adequate protection for their families and their property. If questions arise during this process, our Department stands as a resource to help."

Illinois residents can contact the Department's Consumer Assistance Hotline toll-free at 866-445-5364 or visit the Department's website at www.ins.state.il.us/consumerinfo.htm for information on a variety of insurance topics or to take an interactive quiz to test their "insurance smarts." During Get Smart Week, the NAIC will also operate a toll-free hotline at 1-866-SMARTWEEK (1-866-762-7893) and offer information on its website at www.naic.org.

Other survey findings

To gauge Americans' understanding and perceptions of their insurance coverage, the NAIC commissioned national research company OCR International to conduct a telephone survey of 1,021 adults. Respondents were asked a range of questions based on the various types of insurance coverage they may have, including life, home, auto, health, personal liability, disability, and others.

For example, when asked about annual reviews of insurance policies, the vast majority (83 percent) believe it is a good idea. Shapo concurs, adding: "Regular insurance check-ups are important to a person's financial health at all stages of life. Events such as marriage, divorce, birth or death, the purchase of a new car or home, a child going off to college, or even retirement, as well as changes in insurance products and services, can trigger adjustments in a family's insurance needs."

And, Shapo notes, policy changes don't necessarily translate to higher premiums. "An insurance check-up may alert the agent to the policyholder's eligibility for discounts that will actually lower overall costs."

The survey also found that for 90 percent of respondents in all age groups, a primary benefit of having insurance is peace of mind. However, not all are convinced their coverage is adequate. Overall, the survey found perceptions of coverage adequacy are linked to a household's financial resources. Thirty-two percent of households with less than $15,000 annual income believe they have too little coverage. That figure drops to 16 percent in households with incomes of $50,000 or more.

At the same time, the survey found most Americans don't take advantage of the services offered by their states' insurance departments. Only half of adults were aware of a specific insurance department in their states - and only 14 percent had ever contacted the department for help.

"Although insurance provides peace of mind for many Americans, they don't always know where to turn for unbiased information," Shapo says. "That's where we come in. While we can't recommend specific companies or products, we can answer questions and provide assistance when consumers have problems."

How consumers can "get smart"

In addition to contacting the Department of Insurance, Shapo says consumers can take several other steps to get smart about their insurance coverage:

• Do your homework. Determine the kind of coverage you need. The Department of Insurance offers a variety of information on health, life, auto, home, and other insurance coverage that can help in making purchase decisions.

• Shop around for identical products and services. Not every company charges the same rate. The Department's website offers premium comparisons for auto, homeowners and Medicare supplement insurance.

• Schedule a routine "check-up" with your insurance providers at least once a year.

• Look for ways to lower your costs: e.g., by increasing deductibles or qualifying for discounts.

• Remember: an insurance policy is a legal document. Read it carefully.

"Get Smart Week is the perfect opportunity for the Department of Insurance to connect with consumers and make them aware of our services," Shapo adds. "Whether they need an explanation of how a particular type of coverage works, have questions about their rights as policyholders, or want to file a formal complaint about an insurance problem, we are here to help them get smart about insurance."