Insurance Agents - How Does Yours Measure Up?
Insurance representatives can be some of the most crucial individuals you'll ever do business with. They will assist you protect your house, your possessions and your finances. The work of an insurance representative has the potential to conserve you from financial mess up.
You could go through your entire lifetime and not require the services of an attorney. You might live and die and not need to use an accounting professional. But you cannot live in "the real life" without insurance agents.
Keep in mind ... it's YOUR responsibility to find out which coverages are best for you.
Have you ever heard a story from a friend or relative who submitted an insurance claim, only to discover that the protection their agent assured was not there? I hear those stories ALL THE TIME, and at the WORST POSSIBLE TIME ... AT CLAIMS TIME!
I started my insurance career as a representative in 1973. When I became an insurance adjuster, I kept my representative licenses active until 1992. Throughout that period of time, I sold almost every kind of insurance possible. That gave me a depth of experience in insurance sales. But all that experience did not make me an expert in insurance. I found out risk analysis and sales strategies. I don't think that I ever had one minutes' training in how to manage a claim. When my clients had a claim, I provided the business's phone number and told them to call it in. We sometimes submitted an Acord form, which is a basic market form for suing. That was all we did.
The very best agent is a person who has spend time studying insurance, not a person who is an expert in sales. The largest percentage of insurance representatives of all types are sales individuals, not insurance specialists. Your representative might or might not be a professional in insurance. You'll need to just ask your representative exactly what his education level is.
There are a lot of institution of higher learnings that offer degrees in insurance today. In our area, the University of Georgia provides degrees in Danger Management and Insurance. It's a quite well-respected program.
Representatives can also become experts in insurance by going through continuing education, such as the Certified Property Casualty Underwriter (CPCU) education program. Life insurance representatives can accomplish the Licensed Life Underwriter (CLU) professional designation. There are other classifications readily available to agents, but those two are the most commonly accepted educational programs.
Agents in a lot of states also need to finish a state-required variety of Postgraduate work hours each year in order to preserve their insurance licenses. The state cancels their licenses if they don't complete the hours.
A representative has a task to you, called the "fiduciary task." That means that he must keep your financial wellness initially in his concerns. If an agent sells you an insurance policy due to the fact that it has a greater commission than another policy, he has breached his fiduciary duty to you.
Agents typically carry a type of liability insurance called "Omissions and mistakes" liability insurance. Mistakes and omssions (E&O) is the insurance that covers the agent's company, or the representative separately, in the event that a client holds the representative accountable for a service he offered, or failed to supply, that did not have actually the anticipated or guaranteed results.
1. loss of customer information. The representative just loses your file, physically or electronically.
2. system or software failure. Computer at the agent's workplace crashes and all information is lost.
3. irresponsible oversell. The agent sells you coverage you do not require, or sells you coverage limitations higher than needed.
4. claims of non-performance. This is a broad classification but needs to be. This could include charges that an agent did not offer the correct policy, or the appropriate amount of coverage.
The number 4 example above is the most prevalent and most dangerous for representatives. Here's why.
Individuals today have several insurance exposures, like:
vehicle physical damage
uninsured or underinsured motorists direct exposures
house owner physical damage
property owner liability
businessowner physical damage
life insurance requires
medical insurance needs
disability insurance needs
Any among the direct exposures noted above can effect any of the others. They are intricately woven together in each of our lives.
Any representative doing business in the contemporary world should do an insurance analysis of any possibility's present insurance and his future insurance requirements. To cannot do so is an invitation for a lawsuit.
Exactly what does this mean to you?
First: If your representative makes promises to you about coverage, and your claim gets rejected, you can make a claim against the agent's Mistakes and Omissions Liability policy. You might need to get an attorney involved, however that just increases the possibility that your rejected claim will earn money.
Next: In my never-to-be-humble viewpoint, ALL agents selling ANY sort of insurance ought to perform a Insurance Requirements Analysis for the possibility PRIOR to selling the policy. In addition, I think that a representative should thoroughly discuss the findings of the Insurance Needs Analysis to the possibility PRIOR to offering the policy. Once the explanation is total, the representative should need the prospect to sign off on the policies that are offered, and validate the policies and coverages that are not sold. "Signing off" merely indicates that the prospect mentions that the representative has described all protections, and he either accepts or declines any given protection.
The policyholder has a total explanation of the policy he's purchasing and its relationship to all his other insurance. The agent offers the best coverage, and substantially reduces the risk of a claim or claim against his E&O protection for offering the wrong protection.
Here's what an insurance analysis treatment must look like.
1. Personal Details Collection: get as much info about the insured and his member of the family as possible.
2. Get Copies of Existing Policies: the representative needs to really read the existing policies.
3. Examine Insurance Needs: figure out the right coverages required and the appropriate policy limitations.
4. Recommendations: what must be purchased and costs.
5. Application and Sign-off Analysis: fill out the application and have the insured validate the analysis form.
6. Provide the Policy: An agent needs to deliver the policy in person and discuss it again, not simply send you a copy in the mail.
Even after all the training and education that any insurance agent obtains, the agent is still not a professional in how to manage an insurance claim. I've had great deals of people inform me that they were going to get their representative to assist them with their claim. Later, they found out that the agent didn't understand much more about the claims procedure than they did. As I wrote previously, agents can end up being experts, however their proficiency is usually in the sales and needs analysis areas of insurance ... not claims. For most representatives, learning the claims process would be a waste of their time, given that many representatives are not licensed to deal with claims.
Sure ... some representatives will be given a little claims settlement authority by the business they work for. Some agents will have the ability to settle claims approximately about $5,000.00, then just in the home side of the claim ... such as a little water loss or a theft. However, for the most part, the insurance company focuses claims managing with the claims staff members and independent claims adjusters.
The most crucial methods you should take from this short article are:
Interview EVERY insurance representative to discover out their level of expertise. Let the unskilled agents practice on commercial insurance lexington sc individuals who do not care about protecting themselves the right ways.
You get exactly what you pay for. You 'd be much better served to pay a greater premium if an extremely certified agent takes care of you.
3. If you have issues with your representative, never be hesitant to call the Department of Insurance of your state. Representatives are managed for a factor.
Agents normally bring a type of liability insurance called "Omissions and errors" liability insurance. Errors and omssions (E&O) is the insurance that covers the representative's business, or the agent individually, in the event that a customer holds the representative accountable for a service he provided, or failed to offer, that did not have actually the anticipated or assured results. Next: In my never-to-be-humble opinion, ALL agents selling ANY kind of insurance must carry out a Insurance Needs Analysis for the prospect PRIOR to selling the policy. Even after all of the training and education that any insurance representative gets, the representative is still not an expert in how to deal with an insurance claim. For a lot of representatives, learning the claims process would be a waste of their time, because many representatives are not accredited to manage claims.