Insurance is a word most of us are familiar with. Have you ever actually researched the legal definitions?
It means many different things, depending on the needs for it. Let’s assume in this case, insurance is simply that, the normal common perception. Weather it’s an auto, home, life or commercial among others, it’s not a commodity as perceived. Sure, there are almost an unlimited amount of carriers out there; but are there really? Not on quality. Careful now, lowest price should be a red flag, not a lure to a quote. So, where to start?
Price…You Get what you pay for
Price of premiums should never be your top need. It’s not an actual need. Shopping on price alone can eliminate major benefits that can fit your life and your actual insurance needs. A company that runs on low price to grab attention should be a warning every-time. The phrase “you get what you pay for” is perfect here. In the long run, you could be headed for financial heart-break. If you don’t agree with me here, no further reading of this article is necessary. I will guess that you change companies often, which is an indicator of a major disadvantage for you. There is a reason the premium is always last when you get quotes. Needs first wins every time. I mention price first to make clear it doesn’t matter…yet.
What are your needs? Price is over, so stop saying that. Your needs are simple; it’s basically your life. What I mean here, in reference to mainly personal lines insurance, is think of what’s important to your life. Are you caring for your family, raising children and making a home for others? That’s your top need. Protect those things with layers. Your career and the things you work for round out the most important of needs, it’s purely that simple. What’s left is customizing the smaller differences within those needs. This being said, your liability portion of ANY personal insurance policy is one of the most important pieces. Its protection against the unknown that could be, legally, “your fault”. Never, I say this with absolute conviction; NEVER think you need the “minimums” here for any reason. Believe it or not, liability coverage is generally the least expensive portion of any policy. The real value of insurance is having the absolute most liability coverage you possibly can, if you’re getting a quote and the insurer starts with low limits here, end the quote immediately. That company and agent is building on price alone and is not educated on how a policy is actually rated. These types of carriers are large in numbers; they rely on a computer alone to guide them through the quote. Throw ’em out of the game and tell them why.
Listen to their words, if the selling has started before they have met you that is a problem. Why would you give your birth date, address, or anything upfront? The needs of you, who you are and why you are looking for a different company come first. There is no point of falling into the quote routines that most do. After all, you already did that, now you’re looking again. Why repeat it? That’s the definition of insanity…right?
Genuine Agents are a rare breed today. Anyone can obtain an insurance license and pick a company to sell for. But why did they choose that company? Just because they have large name and are well-known are unacceptable. True Agents represent companies, sometimes multiple companies (Brokers) for the quality of their business vision. Top selling companies aren’t always the best priced. Good Agents wear their brands proudly. If they don’t isn’t it a lie to sell you something they wouldn’t buy?
Check the person out with real conversation. Great Agents have hearts of teachers, not salespeople. When they take their time to get the picture of you-that’s a winner. They choose conversation to asses needs, not how the information is entered in their quoting system. An Agent stands out fast among the “scripted sales call”.
Why do I not speak more of the company and target the Agent? They have made identifying a good company easy. They will only select the great ones to work for. This is important and is taken for granted. Don’t give speed more weight than quality. It takes time to go over an important decision like insurance. Don’t be fooled into “Look how fast and easy we are to get a policy with!” Sure, it was easy to get their policy. They are really saying: “Look how fast we drop you for using the policy you paid for, after we under-paid your loss, while making you feel you shouldn’t have had a loss…bad customer…Bad!” Sadly, this happens everyday. Get a real Agent. Yes, they are just as real over the phone as in person so don’t discount them for that. They carry the exact same authority as your local insurance office. The truth is a true Agent for a good company over the phone usually carries multiple licenses. Agents in an office carry one, possibly the surrounding few states too. It takes daily diligence to maintain an Agent’s license. They must know each states policies, coverage structures, laws, regulations and explanations thoroughly. They must prove the knowledge is kept sharp through mandatory continuing education credits through those states, including business ethics. Trust me when I tell you the states will hammer them hard, possibly legally if they slack. Why would an Agent go through this daily and NOT explain exactly each coverage that is selected. Unless you, the customer know insurance front and back, while understanding your states laws (that change virtually daily)…take time to listen to them. It’s free education that can be priceless. They paid immense time and money to understand it. They hold be eager to share it.
The Best Carriers Want Your Business for Life
This keeps their rates low and quality high. In fact, successful companies do not insure just anyone and everything. You should feel as if they are interviewing you as much as you are them. Many forget where the money for claims comes from. “Many pay the losses of few”-is exactly the science behind insurance. The premiums we pay are resources into a pool of savings. They are used to pay for the losses of other customers. Great companies are not easy to qualify for. There is a reason. It’s not good business to insure every person as long as they get a premium from them. That loss of the 9 speeding ticket two DUI holder is on you. Rates go up. In no way am I saying that mistakes wont happen and you should be punished and shunned if they do. Successful insurers understand that and need that business to. Many have multiple tiers and even develop an entirely new company (still under that insurer) to help these cases. The elite carriers also work hard with these clients to reward a “come-back” if you will. Making mistakes is human. Rewarding honest efforts of a customer to fix them is stellar. They eventually want nothing more than to help you move to the top tiers again. Look hard for these carriers; they are pros at servicing specific cases, not generalizing them into a category. Working hard to keep you for life isn’t easy. The best of the best never judge you by driving records, they always ask these clients “I can show you how to fix this, will you give it your best shot?” If they won’t, or don’t really care to, they should be turned down. There are people who care less about their mistakes and just need a policy to satisfy their state to reinstate their driving privileges. That should be turned down every time. I’m still shocked when I’m told to hurry up and write them a policy because “I have too, the state said you had to” No, what I have to do is protect people. If that means saying no, great agents will every time. Sounds harsh, but your insurer should not willing to put they’re customer’s premiums or the company on the line while they tell me “Look, I just need a policy to drive again; I don’t need a company asking me to change what I do.” They are right, they don’t need a company at all, what’s needed is a bus pass and good walking shoes. It takes guts and diligence to protect current clients well and most “fast and easy” companies take a payment, write a policy and move to the next. After all, that Agent won’t pay the next claim that’s filed, you and I will.
Your Break at Work is Not Time to Get Quotes
Time should be a non-factor in your pursuit to check insurance companies out. In my career, I could never do even a one car auto policy in “15 minutes” or fewer. No, I’m not picking on the lizard here, but that’s just impossible to do it right. Sure, companies can build a price in 1 minute, honestly. Why would any business rush or set a time frame on addressing you, your needs and ensuring you understand what you’re buying. As an Agent, I would politely ask the customer to take my contact information to use anytime they are not in a hurry. Don’t expect to rush and get quoted and bind a policy from great companies or Agents. It would not sit well; at least for me to just run through the process (like others advertise) and get you a policy fast. That’s a guaranteed financial disaster for you later. There is always something missed, while you didn’t know the exact coverage you had but expected perfection. Make time to take time and do it right, the first time. It’s a horrible feeling finding out that fast policy led to wage levy’s and lawsuits against you for an accident the state blamed you for, because you had minimal liability. Then, your home is destroyed by weather, but you didn’t know wind and hail damage is excluded from coverage. Daily, hourly and surely this happens without fail, it’s horrible to see it done by other companies, worse when you bought those policies on your lunch break. Don’t bet a claim won’t happen and over your coverage limits, that’s exactly when they happen…in a devastating way. Don’t sell everything you worked for and love just for the quickness of coverage and cheaper rates. Time is most important to having peace of mind. By time, I mean having no limit to talk about your needs.
By this stage, you have understood needs and addressed them with quality Agents and great companies. If you haven’t figured it out, the price is simple. If you feel your needs are met well, your Agent and company agree and they passed your standards… price doesn’t matter. Sure, companies can beat other companies by this amount or that, but what is not disclosed is there are reasons for that. You truly will get what you pay for. Little known fact…the price is not controlled by the Agent, at all in fact. It’s controlled by the ratings set by your state and what the company needs to protect you well in your circumstance. What factor that has 75 percent (if not greater) controls over the entire price? You. Each individual, family and business is never identical. Remember that “Apples-to-Apples” comparison is fake and a waste of time; no two apples in the entire world are ever the same. Bottom line, if the needs are met well, but you are truly unable to afford the required premium with that carrier, try again just as I started here. It’s out there for you, don’t fall for “we saved people this, we are way cheaper than them” – Red Flag. Why are they hundreds less than those who took time and care customizing your policies? Is something missing? Try this on for a little fact: The price selling companies end up costing more in a year or less than the value building agent that met your needs. That’s assuming you made it a year with no issues like claims or premium raises, accompanied by billing headaches. File a claim on a company that “saved you so much money” then watch what you really pay out of your pockets.
Insurance is NOT a commodity. Stop letting commercials and financial “experts” tell you that. The commodity market is the jokesters that “save you money” The elite, truly great companies will never compete on that level, that is insulting to talk about their prices as strong point. The services are the strong point. They spend time talking about you, what you do in life, where you want to be, you’re family and your dreams then they protect that with everything they have. If you feel that’s too “corny” the funny little “save you money and time” commercials have tainted reality of what insurance is. It’s putting your life back to normal when it’s shattered out of nowhere. Saving 200 bucks a year is great, but I’d pay my last dime, eating noodles everyday to ensure my kids, wife, home and all we have is well covered by the elite agents and companies that I know will be there. Not 30 days later, but right then right there. Money can’t buy seeing your agents actions that say; “I got it from here. You be with your family, I’ll pick up the pieces.”
Price doesn’t matter. It’s always right with the great ones. Let’s stop grabbing a different company every year when they blast ‘funny’ commercials and promises of large savings. Last time one of our clients had a loss, it was not funny. Buy on price and you will shop for the rest of your life, guaranteed. Value and true savings comes when you stay with a winner that showed up when you needed them. We put price aside for the nicer upgrades in our big screens and cars. Why would we ever make insurance about price alone? The shiny car doesn’t rebuild homes and lives, but it sure is shiny.
Insure your mind, its peace is priceless.
– A husband, father, and an Agent. Price wars? No thanks.
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