Tuesday, December 7, 2010

How Do You Choose Your Insurance Agent?

In this advertising age of talking lizards, sarcastic Neanderthals and funny fowls you may believe that anyone can sell you insurance and you’d be mostly right. Many people view insurance as a commodity and feel that it is all the same with no differences other than the price. The truth is that insurance is vast and complex. If you’ve ever tried reading any one of your policies you’d know what I mean. Many policies give coverage to you, take it away in an exclusion and then may turn around and endorse the coverage back on elsewhere in the policy.

As a society we look to CPAs, attorneys, and financial counselors as our trusted advisors and pay top dollar for their services while giving the insurance bid to the lowest priced agent. From an insurance standpoint each person has a unique situation that requires special treatment. A catchy jingle, humorous advertisement or celebrity endorsement is not going to guarantee that a claim is paid.

The best way to make sure that a future claim will be handled correctly is to have a good ongoing relationship with your insurance agent. Your agent should have an understanding of your daily operations and the risks that are involved in running that operation. The agent should also be familiar with insurance. He or she may not need to be a walking encyclopedia of insurance information, but should be able to look at your policy and point out where you may have coverage issues. Having the correct limits and values on your policy is only the first step in the insurance equation. What good are those limits if the coverage is unavailable at the time of loss due to exclusion or other limitation in the policy?

Treat your agent as you would any other trusted advisor. Sit down and go over your coverage, ask questions, and let them know the entire picture. Also, consider narrowing down the number of agents you are using. How may CPAs do you have? How may attorneys? Why should you have multiple agents covering your needs while each of them only knows part of the story on how to best protect you, your family and your business?

If your main insurance concern is price, just remember, that sometimes you get what you pay for. Don’t get burned over a few dollars. Hire a professional to service your insurance needs.

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Post your insurance questions.  I am happy to help if I can.

Steve