Choosing an Insurance Agent is like picking your kickball team at recess.
That was a simpler time wasn’t it? The only thing that mattered was picking the best team to win. Champions of the playground!
Now that you’re an adult, who’s on your team? Who is your accountant, attorney, financial planner, Realtor, Pastor, mentor?
Shouldn’t your insurance agent be part of that winning line up?
If you don’t have confidence in your insurance agent; the person you entrust your assets and financial future to, you need to rethink your situation. Here are some things to consider when choosing an insurance agent.
Direct vs Captive vs Independent
The choices can be a little daunting. Let’s breakdown the differences between Direct vs Captive vs Independent. This is who you buy your insurance from.
Direct Writers
Some insurance companies do not have insurance agents. You call the insurance company and a licensed employee sets everything up for you. If you have questions, concerns, claims – you call the 800 number and work with whoever answers.
Direct Writers have one offering. No choices.
Captive Insurance Agents
Captive Insurance Agents generally only have one option for you. They represent one insurance company and are well versed in the products they offer.
The nice thing with a Captive Agent is you have an agent. Someone you can physically sit down and talk with (versus a Direct Writer).
Independent Insurance Agents
Independent Insurance Agents (sometimes referred to as Insurance Broker) represent multiple insurance companies. Think of walking into Baskin Robbin’s. You can choose from 31 flavors!
They don’t work for any one company. They work for their customers.
If coverage or premium changes, Independent Agents can move your policy from one insurance company to another.
Working with an Independent Insurance Agent is the equivalent to buying a suit and having it tailored to you.
Price
Price matters. It’s part of the equation when buying homeowners insurance.
Spending more money than you make each month is never a good idea.
Be cautious about putting too much weight in the price. When price becomes your main focus you lose sight of why you’re buying insurance in the first place.
You may have three different homeowners insurance proposals in front of you. Each one is going to insure your house, personal belongings, and liability. On the flip side, do you know if the proposals are an HO3 Form or an HO5? After so many years do any of those companies change how your roof settlement will be at the time of a loss?
Price is significant, but don’t discount why you buy home insurance.
Set Expectations
What do you expect from your insurance agent?
Of course you want to be made whole at the time of a loss. Aside from that, what is important to you?
- Do you need to see your insurance agent in-person at a minimum of once per year?
- Your agent must pick up their phone every time you call?
- Your insurance agent better have an app for your phone.
- You can only discuss insurance on Thursday nights after 9:00 pm
Clearly communicating what you expect up front can avoid issues down the road.
Be open with your agent in the beginning. He/she will appreciate it.
Ask
Ask questions…you have no idea until you ask. It may sound elementary, yet would your significant other have said yes to a date if you hadn’t asked?
Ask Friends and Family
Who better to ask for recommendations than friends and family? Who do they confide in and why?
Ask the Insurance Agent
Don’t be hesitant to interview an insurance agent prior to working with them. Ask questions.
- How long have you been in business?
- Do you have an area you specialize in?
- How do I file a claim (in the event I have one)?
Ask the Internet
Never in history has there been a better time to do your homework on a topic. After the kids go to bed, jump on your computer search the internet.
Safe at Home
Insurance isn’t sexy. That’s obvious.
When it comes to protecting the place you lay your head at night, doesn’t it make sense to work with a professional?
