CONSUMER INFO / WHY CHOOSE AN INDEPENDENT INSURANCE AGENT?_______________________________
Today there are several avenues for consumers to purchase insurance:
- Captive agents who can generally sell insurance from only one company,
- Direct response representatives who can offer insurance of one company and only on the phone,
- Internet sites where consumers can fill out an application online and get an insurance quote without any help or direction from a qualified professional, and
- Independent Insurance Agents who represent an average of eight insurance companies – although through brokerages services have access to many, many more – and research these firms to find the best combination of price, coverage and service to accommodate the unique needs of the client.
Insurance is needed to drive a car, purchase or rent a home, to protect your family’s health, financial future and assets and to run a business. Some people think it doesn’t really matter where they buy their insurance. But this misconception could be costing them money, service and protection. Insurance isn’t a commodity. Insurance is a safety net that is best provided by a professional who is willing to take an interest in your specific and unique situation.
Independent agents in Virginia are required to pass a rigorous professional examination to obtain their license to sell insurance and are further required to take continuing education courses annually in order to maintain their license. Moreover, insurance agents in Virginia are regulated by the Virginia Bureau of Insurance which is part of the State Corporation Commission and they regularly and randomly conduct insurance agency inspections. This important consumer protection wasn’t established because insurance products and coverage is easy to understand; it was established to ensure that only those trained, tested and qualified should be entrusted with your future and that of your family.
In a 2008 study of homeowners, 54% admitted to knowing “not much at all” about their homeowner’s insurance policies. The dangerous aspect of this survey is that insurance is supposed to act as a safety net and if the consumer is not sure that they are adequately protected, it’s not much of a safety net. Make sure that you select a professional who will take an interest in your future.
There are literally hundreds of insurance companies who are licensed to sell property/casualty, workers compensation and life and health insurance in the Commonwealth of Virginia. Who is best positioned to help you in this selection of the myriad of choices? Who can make sure that the insurance company you select will be in business when you need them?
What can you expect from an Independent Insurance Agent?
Your local agent:
- Helps you assess new risks in order to determine if you should retain a risk or transfer it to an insurance company – in other words, helps you determine how much of a deductible is best for your unique situation,
- Chooses which companies they will represent assuring that any policy they offer you is issued by a reliable company with solid financial strength,
- Works with clients on risk assessment, risk management and loss control activities to help them become better risks,
- Makes sure that all of your policies are coordinated to offer the best coverage at the best price – without leaving gaps or duplicating coverage,
- Works for you, not the insurance company.
- Does the shopping for you, obtaining insurance quotes and coverage – and occasionally “shopping” their insurance coverage’s with multiple companies to determine the best combination of coverage and cost for the various services offered by the companies,
- Act as the client’s intermediary and representative when dealing with various insurance companies – this includes communications with underwriters, auditors, claim departments and billing departments,
- Regularly reviews financial information on companies and the insurance industry,
- Negotiates policy terms and premiums,
- Obtains answers to coverage questions,
- Works with companies to assess and find coverage for new and emerging risks,
- Communicates with carriers about conditions in the marketplace,
- Works to review, evaluate and encourage new carriers into the marketplace,
- Is your expert resource when a claim needs to be filed and can contact the company and get the claim process rolling – help you complete the claim forms and advise you on the progress of your claim – making sure you receive a prompt and fair settlement,
- Reviews claims in order to implement corrective action and forestall renewal problems,
It is the agent’s job to act as part of your financial team – like your attorney or accountant – to provide professional advice to help you manage your risk protecting your current and future assets. The agent then annually – or more frequently – reviews your account to ensure that your insurance products are responding to your changing needs.
For example, in health insurance we have seen dramatic increases in premiums. Consequently, the agent will receive calls from the majority of health customers every year asking “how can we reduce the cost to a more affordable level.” The agent must know and stay on top of the available products on the market, coverages and exposure to assist that the customer in meeting the financial needs of their family.
While many insurance companies offer similar products and coverages, each company is unique with respect to their own options, pricing, and many other variables. An independent agent’s job is to know what those variables and options might be – advise you the insurance customer – and help you get the best coverage for your specific need and budget. Speaking of which, most independent agents are paid on a commission basis through business arrangements with the companies they represent so unless your situation is exceptionally large – where a fee arrangement might be more appropriate – the services of your independent agent are included in the price of your premium.
Insurance is about peace of mind, and that’s what you get when you trust your protection to an independent agent. Peace of mind is more than taking care of you when you have a claim – it’s also knowing you have the right coverage in case you need to make one.