Despite the information age giving us the opportunity to easily purchase car insurance directly from the provider, there are still some individuals who prefer to deal with an independent agent. These insurance professionals are agency owners or employees representing multiple insurance companies for each of the lines of insurance they offer. For consumers who use them, the question is one of what you should look for in an car agent.
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Government numbers from the Bureau of Labor Statistics suggest there were more than 411,000 insurance agents working in United States at the end of 2010. As for how many individual agencies of those individuals represent, the BLS doesn’t say.
Nonetheless, if you’re interested in buying your car insurance through independent agents you have plenty of choices to work with. To get started, contact three or four in your local area and ask lots of questions.
Answering and Returning Calls
One of the first signs of a good insurance agent is that he answers his calls during normal business hours, or he promptly returns those he missed. The same can be said for e-mail communications.
An insurance agent who does not make communication a top priority is one who is more likely to not put his full effort into making sure he is looking out for your best interests.
Consumers should allow for some flexibility if an agent works in a particularly busy agency, but there’s no excuse for an insurance agent not getting back to a customer within a few hours.
Along the same lines, a good insurance agent also speaks directly to his or her customers rather than asking receptionists or assistants to handle communications for him. Your insurance agent is supposed to be your advocate. Yet how can he fulfill that role if he continually passes you off to others in his office?
Attentive to Your Needs
According to the state of Minnesota’s iSeek Solutions website, independent insurance agents usually work exclusively on commission. That means instead of drawing a weekly salary based on number of hours worked, the agent is paid a certain percentage of every policy he sells.
Logic would dictate that this model would be incentive for the agent to sell the most expensive policy possible without regard to what customers really need. In fact, this is indeed what happens with insurance agents who have no personal integrity.
The reality of commission-based sales agents makes it absolutely necessary for the individual consumer to look for an agent who is genuinely attentive to his needs. You want an agent that:
Listens as you explain your circumstances
Works with you inside of those circumstances
Is willing to work to find you the best coverage at the best price, regardless of how much or little commission he makes
A good insurance agent is happy to make his money on volume generated by good business practices rather than simply on higher-priced policies.
Working within Your Budget
Part of being attentive to your needs is being willing to work within your budget. Yet stop for a moment and ask yourself when the last time was that an insurance agent or provider asked how much you could really afford for car insurance. Most simply launch into calculating a price based on the information you provide without any regard to customer budget. A good car insurance agent doesn’t do that.
Why? Because he knows it doesn’t do any good to sell you the most expensive policy if you have no realistic chance being able to afford the premiums. A good agent wants to know what you truly can afford so that he can tailor a policy accordingly. If he can’t find an affordable policy that fits within your budget at least he’ll be able to give you the lowest cost options available through his agency.
From a consumer standpoint, staying within your budget is essential. Remember that the total cost of ownership for your vehicle includes your monthly bank payment, insurance premiums, gasoline, routine maintenance, and repairs.
If your bank payment is already putting you right at the edge of your budget, a costly insurance policy might be just what pushes you over the cliff of being unaffordable.
Be careful to consider all of the costs before buying a car or purchasing an insurance policy.
Willingness to Answer Questions
A willingness to make sure all of your questions are answered is another sign of a good car insurance agent. One who is willing to do so gives the impression of being more interested in the best interests of clients rather than being an agent simply out to make a fast buck.
In addition, a good agent answers questions in an honest and forthright manner without pandering, obfuscation, or arrogance. His answers are clear and easy to understand as well, because he speaks using everyday language the average consumer understands.
When you do have questions, be sure to ask as many as necessary to provide you full and complete understanding. Nothing is worse than purchasing a car insurance policy you don’t understand only to find out after an accident that the terms and conditions are different from what you were expecting.
As a consumer, it is your right to know everything about any product you’re buying, even car insurance. So don’t settle for agent who is not willing to give you all the answers you need.
Claims Service
When it comes time to make a claim on your auto insurance the best agents do what they can to help facilitate the process and make it as easy as possible. In fairness, some large car insurance companies prefer their independent agent affiliates not get involved in the claims process beyond providing a name and telephone contact number. Others prefer that agents walk their customers through the claims process personally.
You’ll have to ask about claims service when looking at a new policy. If agent participation is something you feel is important, that might limit the number of policies the agent can offer you.
If your carrier does encourage agents to participate in the claims process, you want one that will give you his undivided attention while handling your case. You want an agent who will:
Come to the accident scene if possible
Help you fill out the required paperwork in a timely manner
Assist you in documenting your accident through digital photographs
The more your agent is willing to get involved in the claims process the better he’s able to meet your needs.
Industry Awards and Certifications
The last thing to look for in finding a good auto insurance agent are any awards or certifications the company has earned from industry peers. For example, J.D. Power and Associates has developed their Distinguished Insurance Agency Program to provide recognition and certification to insurance agents and their employees for superior work and ethical practices. The program specifically encourages Best Practices among agencies for the benefit of consumers.
Similar to certifications in other industries, insurance companies can only be recognized by J.D. Power and Associates under this program if they meet a very stringent set of requirements. The requirements are designed to help ensure that certified agencies are doing everything within their power to be the best at what they do.
J.D. Power gives out a number of awards every year meant to highlight customer satisfaction rates, prices, and quality of insurance products. You can find a complete list on their website.
Wrapping It Up
Whether you’re purchasing auto insurance through an independent agent or directly from an underwriter, you have certain rights afforded you by law. As an example, the Massachusetts Consumer Bill of Rights for Automobile Insurance indicates that drivers in that state have the right to seek the lowest possible price, and get it when possible, when searching for an auto policy. Just about every other state codifies the rights of drivers within state law even if they don’t use the term “Bill of Rights.”
Other rights common among the states include the right to be treated fairly at all times, the right to be fully informed of reasons why a policy or claim was denied, and the right to contest any settlement offered by an insurance company after an accident. Knowing what your rights are is one of the best ways to protect yourself.
If you feel an agent or car insurance provider is treating you unfairly, you always have the option of contacting your state insurance department to file a complaint. The insurance department may not be able to mediate a settlement, but they can investigate to make sure the agent or insurance company is not trampling on your rights. If it’s discovered that they are, they could be faced with fines, penalties, and a license suspension.
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