Buyer Beware: The Good, the Bad and the Insurance Agent

“As a struggling business owner, the last thing I want is someone driving up in a new BMW trying to sell me insurance,” states Clayton Spark, a 36-year-old auto repair garage owner.

The United States has thousands of insurance agents licensed to sell various products to consumers. Most agents are required to partake in rigorous licensing procedures including seminars and exams. Depending on the license obtained by the agent, he or she can sell anything from life and health insurance to automobile or homeowner’s policies. Some agents can hold several licenses.

While most agents are genuinely concerned with their client’s needs and service their policies professionally, it’s the few agents on the opposite end of the spectrum that cause the negative reactions of some customers.

“The guy came to my house, sold me a life insurance policy and I gave him the money for the first two months,” recalls Tom Morrison, a retired farm worker. “I never heard back from the guy. He never delivered a policy, returned my calls or anything.”

Finding the Right Agent

What can be done during the initial meeting or conversation with an agent?

“Listen and ask questions,” states one long-time insurance agent. “Ask the agent for references. If he or she is being referred to you by someone you know, don’t hesitate to ask the person questions about that agent.”

When talking to an agent, take physical and mental notes on what is being said. Physical notes are beneficial if parts of the conversation need to be remembered. Mental notes will help to determine if this is the right insurance agent. Is the agent organized? Is he or she on time? Is the agent openly critical of other clients or agents?

“My boss had a bad habit of being late for appointments with clients,” says Linda Pierce, a former assistant to an insurance producer at a brokerage company. “She would set appointments before proposals were ready and she wouldn’t have any definite rates to show the clients. She would complain about other agents to clients. When she returned to the office she would complain about the client.”

“The agent I worked with was opposite,” Teresa Watts, a former assistant at the same brokerage company, states. “She knew the insurance coverages, knew how long proposals would take and made appointments accordingly. If she was going to be late for an appointment, she would call the client to let them know. Any frustrations she had with clients or other agents were never apparent.”

Choosing the Best Insurance Coverage for Your Needs

Choosing the best coverage can be as difficult as finding the right agent. It is important to keep in mind what coverage is needed and its affordability. A client should not feel pressured into buying any coverage.

“We bought health insurance through one (agent),” recalls Clayton Spark. “I let her know that we couldn’t afford dental or life insurance but every time she stopped by or I talked with her on the phone, she would mention that we needed the coverage. We eventually went with someone else who had better insurance. They were cheaper and don’t hassle us as much.”

When choosing coverage, ask to see rate and coverage comparisons between different companies. This allows a prospective insured to accurately determine which company offers the best product at a competitive price. It is crucial to ask questions at this time. What does the agent know about the company? What is the company’s history on rate changes, claim payments or customer service?

“When trying to help someone choose coverage, I like to show the client the three most competitive companies,” states one insurance agent. “I compare coverages and rates of each company. I then give my client a copy of the comparison along with materials on each company. I answer any questions they may have and give my opinion as to which coverage would benefit them most.”

“I was disgusted with the last insurance agent we had,” states Wanda Harris, owner of a small business with three employees. “We opted to purchase life insurance after he talked with us. The bills that we received were almost twice as much as he said it would be. After trying to contact him with no luck, I called the insurance company. I found out that our policy was written incorrectly and the agent wasn’t a representative of the company until this policy. We were fortunate that they cancelled our policy and refunded the money we had sent them.”

Know What You’re Buying

Although the application process may seem simple, it’s still a time to be attentive. Any forms or literature that is received should be reviewed thoroughly. When the application is being completed, questions and signatures should not be left blank. Once the application is completed, a copy should be kept for personal records.

“She (the agent) would tell clients to leave answers blank on the application,” states Linda Pierce. “When she would get back to the office, a guy who had severe high blood pressure and taking medications would have only slightly elevated blood pressure on his application. It looks good to the insurance company until they pay a higher number of claims which, in turn, increases the rates for that person or business.”

“I never tell a client to leave something blank unless the application advises it,” states one agent. “They sign the application and then I sign where I need to. If they’re in my office, I give them a copy of the application right away.”

What Happens Now?

After policies are received and coverage is in place, agent availability is still important for a client. What if a client has questions or concerns? Is the agent still willing to talk to a client?

“The agent I worked with would give customers her pager number,” states Teresa Watts. “If a client couldn’t reach her at work, they knew she would return a page. She would answer any questions or help solve problems that occurred.”

“I’ve had numerous agents refuse to take phone calls from clients who were desperate to speak to them,” says Janet Bowen, an employee with a 24-hour customer call center. “Some don’t seem to care if they lose that client’s business.”

Good insurance agents are not hard to find. Unfortunately it is the few inexperienced, overzealous agents that create a bad reputation for themselves, other agents and the companies they represent.

“I still wouldn’t do business with that company again,” explains Tom Morrison. “Even with a few helpful people in their organization, they still have people out there who are only concerned with making a dollar.”

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