Business Insurance Over the Internet – What Are The Risks?

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It’s no secret that times have changed and insurance has changed too. If it ever existed, the era of buying your business insurance from Uncle Harold down the street is gone. The World Wide Web is your new home. So, is buying Internet insurance so very different from getting it from a local agent with a “brick & mortar” shop? Online business insurance applications pose greater security and confidentiality risks. Is there another term for fraud called “Internet insurance?”

Answering all these questions is “no.” Internet insurance has caused business insurance companies to alter the way that they market their products. The only difference is that it’s easier to obtain information and much more convenient to communicate directly with potential business insurance providers. Although you will still need to complete forms and ask representatives questions at times, it is now possible to do so from the comfort of your home in your pajamas.

Be careful not to be seduced by the ease of purchasing insurance online that will allow you to relax your standards. Online insurance can be as secure as dealing with an “offline” business insurance carrier. However, no smart businessman would trust their livelihood to an online company without first verifying that the company is trustworthy and sound. Do your research, just like you would with an “offline company”. Joe’s Shady Alley Insurance Agency would not take your money. So why should Joe’s Shady Internet Insurance Agency have it?

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Ask yourself: Who are these Internet-based insurance companies? Many of the names you’ll recognize are well-known. All major business insurance companies are now online. If you have used them before, it is no reason to change. Check out the website if you are not familiar with the company. Is the company licensed to do business within your state? How long have they been in business? Are there any pending lawsuits or complaints? Is it able to pay its bills? Is there any testimonials from clients? You should ask the same questions to an Internet-based insurance company as you would any other company.

There are a few things you should be aware of when working with online insurance providers. Online transactions and communications offer thieves new opportunities to steal your money and your information. It’s unlikely that your information will be stolen by hackers. However, it’s worth asking how much information is stored in the Internet-connected databases of the insurance company and what level of security they have. It is safer to have your credit and bank card information deleted by the company after they make an online payment. The bank will then pass this information on to another bank.

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This may prevent automatic payments, and it is not a standard industry practice. You can protect your information with high levels of encryption (128bit) but it is important to check if there are redundant firewalls, if they monitor their network by an outside security company and if they run simulated computer-based attack tests on their system. You can do business online with a company that takes these precautions as if you were handing them paperwork.