What Should I look for in an auto insurance agent?
Insurance agents are not created equal. Whether you are looking for Auto Insurance, Homeowner’s Insurance or Life Insurance selecting an agent that can help you assess your insurance needs is an important first step. Remember 85 percent of your insurance premium goes towards providing coverage.
The other 15 percent goes to the agent. Whether you realize it or not you’re paying for professional advice, service and assistance from an agent. Make sure you’re getting your money’s worth. Spend that 15 percent wisely.
Before diving into what to look for in a particular agent you must first determine whether you want to deal with an Independent Agent often referred to as a Broker or with an Exclusive Agent sometimes called a Captive Agent. Independent Agents represent and sell insurance from a number of companies.
They operate independent businesses that do not collect salaries but instead are paid a commission on the policies they sell. Their primary fiduciary responsibility is to the client. An independent agent owns and controls his or her accounts, policy records and renewals. In simple terms they own the customer relationship.
An Exclusive Agents represents and sells insurance from a single carrier. Like Independent Agents they work for independent businesses and are paid on a commission basis. However, their primary fiduciary responsibility is to the carrier they represent. Exclusive agents do not own and control accounts, policy records and renewals. That responsibility belongs to the insurance carrier they represent.
Independent Agents will be able to offer more options and more potential savings but may charge a brokerage fee. If they do, they are required by law to disclose this information. If you know the insurance carrier you want to use, go with an Exclusive Agents. If you are more open to which carrier you want, consider using an Independent Agent.
Experience and Education
Look for agents that have a minimum of 5 years of experience working with the type of insurance you’re buying. If you’re looking for Life Insurance you want a Life Insurance expert.Buying Life Insurance from the agent that sold you Auto Insurance probably is not a good idea. Remember you’re spending 15 percent on the agent. Insist that person is a subject matter expert.
An insurance agent can earn a number of advanced designations by completing and passing additional exams. These designations may help you whittle down your short list of agents.
- Chartered Property Casualty Underwriter (CPCU)
- Certified Insurance Counselor (CIC)
- Accredited Advisor in Insurance (AAI)
- Certified Life Underwriter (CLU)
Great Customer Service – Reputation and ties to the community
- When it comes time to use your Car Insurance the last thing you’re going to want is poor customer service from your agent. If an agent is not super responsive, courteous and professional during your initial due diligence when they are trying to win your business, don’t count on them being that way when there is a problem and you need their help.
- Word of mouth is still the most powerful marketing tool for agents. You probably won’t have to dig too deeply to find out what other clients think. Agents that realize how reputation is tied to success are likely to do the right thing when you need them the most. Look for agents that are active in the community and have local roots.
- Insurance never seems important until you need it. Having the right coverage in place and great service in your time of need is crucial. Spend time up front finding an agent that can help you assess your needs and find you a good deal on the right coverage.