Insurance Representatives - How Does Yours Measure Up?



Insurance agents can be some of the most essential individuals you'll ever work with. They will assist you protect your house, your assets and your finances. The work of an insurance agent has the prospective to conserve you from monetary mess up.

You might go through your whole lifetime and not need the services of an attorney. You could die and live and not need to utilize an accounting professional. But you can't live in "the real life" without insurance representatives.

Keep in mind ... it's YOUR duty to find out which protections are ideal for you.

Have you ever heard a story from a good friend or relative who filed an insurance claim, only to find out that the coverage their agent promised was not there? I hear those stories ALL THE TIME, and at the WORST POSSIBLE TIME ... AT CLAIMS TIME!

I began my insurance career as a representative in 1973. I kept my representative licenses active up until 1992 when I ended up being an insurance adjuster. During that period of time, I offered nearly every kind of insurance you can possibly imagine.

The very best agent is an individual who has spend time studying insurance, not an individual who is a professional in sales. The biggest portion of insurance agents of all types are sales people, not insurance specialists. Your representative may or may not be a specialist in insurance. You'll need to simply ask your representative exactly what his education level is.

There are a lot of colleges and universities that offer degrees in insurance today. In our area, the University of Georgia uses degrees in Threat 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 attain the Qualified Life Underwriter (CLU) expert classification. There are other designations available to agents, but those two are the most widely accepted educational programs.

Agents in most states likewise 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 finish the hours.

A representative has a task to you, called the "fiduciary responsibility." That implies that he should keep your financial well-being initially in his top priorities. If a representative offers you an insurance coverage because it has a higher commission than another policy, he has breached his fiduciary duty to you.

Representatives typically carry a type of liability insurance called "Mistakes and Omissions" liability insurance. Errors and omssions (E&O) is the insurance that covers the agent's company, or the representative separately, in the occasion that a customer holds the agent accountable for a service he supplied, or stopped working to provide, that did not have the anticipated or guaranteed outcomes.

1. loss of client data. The representative just loses your file, physically or electronically.

2. system or software failure. Computer system at the representative's office crashes and all information is lost.

3. negligent oversell. The agent offers you protection you don't need, or offers you protection limits higher than necessary.

This needs but is a broad classification to be. This might include charges that an agent did not offer the appropriate policy, or the proper amount of protection.

The number 4 example above is the most common and most harmful for agents. Here's why.

People today have numerous insurance exposures, like:

car physical damage

auto liability

underinsured or uninsured drivers exposures

homeowner physical damage

house owner liability

excess liability

businessowner physical damage

businessowner liability

home-based companies

life insurance needs

health insurance requires

disability insurance requires

Any one of the exposures noted above can effect any of the others. They are intricately woven together in each of our lives.

Any agent doing business in the modern-day world must do an insurance analysis of any prospect's present insurance and his future insurance requirements. To cannot do so is an invite for a lawsuit.

Exactly what does this mean to you?

: If your representative makes promises to you about protection, and your claim gets denied, you can make a claim versus the representative's Omissions and mistakes Liability policy. You may have to get a lawyer involved, however that only increases the chance that your rejected claim will get paid.

Next: In my never-to-be-humble viewpoint, ALL representatives selling ANY kind of insurance must perform a Insurance Requirements Analysis for the prospect PRIOR to offering the policy. In addition, I think that an agent must carefully describe the findings of the Insurance Needs Analysis to the possibility PRIOR to offering the policy. Once the explanation is Car Insurance Lexington Sc total, the agent needs to need the prospect to validate the policies that are sold, and approve the policies and coverages that are not offered. "Signing off" just implies that the possibility specifies that the representative has actually explained all protections, and he either accepts or declines any given protection.

Both parties. the representative and the policyholder ... advantage in this deal. 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 considerably lowers the danger of a lawsuit or claim versus his E&O coverage for offering the wrong protection.

Here's exactly what an insurance analysis procedure ought to appear like.

1. Personal Info Collection: get as much details about the insured and his relative as possible.

2. Get Copies of Existing Policies: the representative ought to in fact read the existing policies.

3. Evaluate Insurance Needs: identify the proper coverages required and the appropriate policy limitations.

4. Recommendations: exactly what ought to be acquired and prices.

5. Application and Sign-off Analysis: complete the application and have the insured sign off on the analysis type.

6. Provide the Policy: An agent must deliver the policy personally and describe it again, not simply send you a copy in the mail.

Even after all of the training and education that any insurance representative acquires, the representative is still not an expert in how to deal with an insurance claim. For the majority of agents, discovering the claims procedure would be a waste of their time, because a lot of representatives are not certified to manage claims.

Sure ... some agents will be provided a little claims settlement authority by the company they work for. Some agents will have the ability to settle claims up to about $5,000.00, and after that just in the home side of the claim ... such as a small water loss or a theft. However, for the most part, the insurer concentrates claims managing with the claims staff members and independent claims adjusters.

The most essential methods you should draw from this article are:

Interview EVERY insurance representative to discover out their level of expertise. Let the inexperienced representatives practice on individuals who don't care about protecting themselves the best methods.

2. Don't always chase the most affordable premium. You get what you pay for. If a highly qualified representative takes care of you, you 'd be much better served to pay a greater premium. You don't drive the most affordable car you can discover, do you?

3. If you have problems with your representative, never ever be reluctant to call the Department of Insurance of your state. Agents are controlled for a reason.


Representatives generally carry a type of liability insurance called "Errors and Omissions" liability insurance. Mistakes and omssions (E&O) is the insurance that covers the representative's company, or the agent individually, in the occasion that a customer holds the representative responsible for a service he provided, or failed to supply, that did not have the expected or promised results. Next: In my never-to-be-humble viewpoint, ALL representatives offering ANY kind of insurance need to perform 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 handle an insurance claim. For many agents, discovering the claims procedure would be a waste of their time, given that most agents are not licensed to deal with claims.

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