Choosing An Insurance Agent or Broker
What Does An Insurance Agent Do?
An insurance agent sells and services insurance policies. An agent may specialize in a particular type of insurance such as life or health. An insurance agent is an independent agent, a direct writer, or captive agent.
How Do The Main Types Of Insurance Agents Differ?
An independent agent represents more than one insurance company and can choose from multiple policies to fit their clients’ needs. Direct writers and captive agents represent only one insurance company and sell only that company’s policies.
How Can I Choose The Best Insurance Agent For My Needs?
The first step is to decide what insurance you want from an agent, be it auto, home, life, health, disability, long-term care, or any other type of policy. Keep in mind that one advantage of working with a single agent for all of your insurance needs may be that any gaps in your coverage should be readily identified.
Next, identify at least 3 candidates. You can find candidates for this list by following the advice below:
Ask for references from people whose financial advice you respect. You want to know about the personality and the overall job an agent does, not just that the agent can save you money.
If you’ve decided on an insurance company you want to do business with, you can get names of agents from the company. On most insurance company websites you can get a listing of agents in your area. Next, interview your agent. Ask your candidate agents these questions:
How much experience do you have and in what types of insurance?
Will you handle my account on a daily basis or will someone else in the office?
What process do you use with a client to help identify risk and design a protection plan including identifying and filling any coverage gaps?
Do you periodically review their plan with the client? If so, how frequently?
It is important that you feel comfortable with the agent. If you don’t like the agent, then choose someone else. You want an agent that listens to you, asks about your insurance needs, and only wants to sell you policies that you need and can afford.
What Are Some Advantages of Using More Than One Insurance Provider?
- Getting the lowest premium for a particular coverage
- Buying from a company specializing in the coverage
- Choosing from policies offered by many providers
Disadvantages of using more than one provider for your insurance coverage:
- There may be gaps in your coverage
- Coverage limits may be inconsistent across your policies. For example the personal liability coverage under an auto policy may be $100,000 and $300,000 under a homeowner’s policy. It should be the same.
What Are Some Advantages of Using Multiple Insurance Providers?
- Premium discounts for multiple policies
- Only one agent to deal with for all claims
- Coverage limits should be consistent across your policies
- Any gaps in coverage should be identified and filled
Disadvantages of using only one provider:
- Premiums for a particular policy may be lower from another provider
- Limited to the policies offered by that provider
Choosing the best Insurance agent for your individual insurance needs will take research and thoughtful decision making, but in the end, your efforts will be well worth the peace of mind that comes from knowing that you and the ones you love are protected against any eventuality.