Insurance Representatives - How Does Yours Measure Up?



Insurance agents can be a few of the most essential individuals you'll ever work with. They will assist you protect your home, your possessions and your financial resources. The work of an insurance representative has the potential to save you from financial destroy.

You might go through your entire lifetime and not need the services of a lawyer. You might live and die and not need to utilize an accountant. But you can't reside in "the real life" without insurance representatives.

Remember ... it's YOUR duty to learn which coverages are ideal for you.

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

I started my insurance career as an agent in 1973. I kept my agent licenses active until 1992 when I became an insurance adjuster. During that period of time, I sold nearly every kind of insurance imaginable.

The best agent is an individual who has spend time studying insurance, not an individual who is a professional in sales. The biggest percentage of insurance representatives of all types are sales people, not insurance specialists.

There are a great deal of institution of higher learnings 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.

Agents can also become experts in insurance by going through continuing education, such as the Certified Residential Or Commercial Property Casualty Underwriter (CPCU) education program. Life insurance agents can achieve the Licensed Life Underwriter (CLU) expert classification. There are other classifications readily available to representatives, but those two are the most commonly accepted curricula.

Representatives in most states likewise have to complete a state-required variety of Postgraduate work hours each year in order to keep their insurance licenses. If they don't complete the hours, the state cancels their licenses.

A representative has a task to you, called the "fiduciary task." That means that he must keep your financial well-being initially in his top priorities. He has breached his fiduciary task to you if an agent sells you an insurance policy due to the fact that it has a higher commission than another policy.

Agents usually bring a type of liability insurance called "Mistakes and Omissions" liability insurance. Errors and omssions (E&O) is the insurance that covers the representative's company, or the agent separately, on the occasion that a client holds the representative responsible for a service he offered, or cannot offer, that did not have the anticipated or guaranteed results. This protects agents and their clerical staff from liability due to negligent acts, mistakes and omissions while performing their organisation. It will secure the agent from problems like the copying:

1. loss of client information. The agent simply loses your file, physically or digitally.

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

3. irresponsible oversell. The agent offers you coverage you don't need, or sells you protection limits higher than needed.

4. claims of non-performance. This requires however is a broad category to be. This could include charges that a representative did not offer the appropriate policy, or the proper quantity of coverage.

The number 4 example above is the most prevalent and most unsafe for representatives. Here's why.

People today have numerous insurance exposures, like:

automobile physical damage

car liability

underinsured or uninsured drivers direct exposures

homeowner physical damage

house owner liability

excess liability

businessowner physical damage

businessowner liability

home-based services

life insurance requires

health insurance needs

disability insurance needs

Any among the direct exposures noted above can effect any of the others. They are elaborately woven together in each of our lives.

Any agent doing business in the contemporary world ought to do an Lexington Insurance Agency insurance analysis of any prospect's present insurance and his future insurance requirements. To cannot do so is an invitation for a lawsuit.

Exactly what does this mean to you?

: If your agent makes promises to you about protection, and your claim gets rejected, you can make a claim against the agent's Omissions and errors Liability policy. You may need to get an attorney involved, however that only increases the chance that your denied claim will earn money.

Next: In my never-to-be-humble opinion, ALL representatives selling ANY kind of insurance must carry out a Insurance Needs Analysis for the prospect PRIOR to selling the policy. In addition, I think that an agent must carefully explain the findings of the Insurance Requirements Analysis to the prospect PRIOR to selling the policy.

The insurance policy holder has a complete description of the policy he's purchasing and its relationship to all his other insurance. The agent offers the best protection, and considerably lowers the danger of a lawsuit or claim versus his E&O coverage for offering the wrong protection.

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

1. Personal Info Collection: get as much information about the insured and his member of the family as possible.

2. Get Copies of Existing Policies: the agent needs to really check out the existing policies.

3. Analyze Insurance Requirements: identify the proper coverages required and the appropriate policy limitations.

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

5. Application and Sign-off Analysis: submit the application and have the insured accept the analysis form.

6. Deliver the Policy: An agent must deliver the policy personally and explain it once again, not just send you a copy in the mail.

Even after all of the training and education that any insurance agent gets, the agent is still not a professional in how to handle an insurance claim. For many representatives, learning the claims procedure would be a waste of their time, since a lot of agents are not certified to manage claims.

Sure ... some agents will be offered a small claims settlement authority by the company they work for. Some representatives will be able to settle claims as much as about $5,000.00, then only in the residential or commercial property side of the claim ... such as a little water loss or a theft. For the most part, the insurance business focuses claims managing with the claims workers and independent claims adjusters.

The most crucial techniques you need to take from this post are:

1. Interview EVERY insurance agent to learn their level of proficiency. Just do business with the most qualified, informed and experienced agents. Let the inexperienced representatives practice on people who don't care about protecting themselves the proper ways.

You get what you pay for. You 'd be better served to pay a higher premium if an extremely certified representative takes care of you.

3. Never be hesitant to call the Department of Insurance of your state if you have problems with your agent. Representatives are regulated for a reason.


Agents typically bring a type of liability insurance called "Mistakes and Omissions" liability insurance. Mistakes and omssions (E&O) is the insurance that covers the agent's company, or the agent individually, in the occasion that a customer holds the representative accountable for a service he supplied, or failed to provide, that did not have the anticipated or assured outcomes. Next: In my never-to-be-humble opinion, ALL agents selling ANY kind of insurance ought to perform a Insurance Requirements Analysis for the possibility PRIOR to offering the policy. Even after all of the training and education that any insurance agent acquires, the agent is still not an expert in how to deal with an insurance claim. For a lot of representatives, finding out the claims procedure would be a waste of their time, given that the majority of representatives are not accredited to deal with claims.

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