What to Consider When Choosing an Insurance Company

Fact Check: False

Insurance is Insurance is Insurance

The buying public is inundated these days with advertisement and promotional material attempting to persuade them into a purchasing decision. The tactical approach usually takes some form of one of two common strategies – emotional appeal (including humor) and price. Some larger insurance companies have attempted to blend the two, especially using humor. But, realistically, the emotional component of the message is rarely relative to the product, especially when insurance is involved, so they are too often are left to advertising price.

Let’s get down to the brass tacks – insurance isn’t a product that you buy with the expectation of using it for enjoyment. It also isn’t that funny, if we really are honest about it. Insurance can be frustrating, confusing, stressful, expensive or affordable, and, if written properly, incredibly reassuring. So why do companies, and some agencies, treat insurance like it is just another commodity on the shelf, obfuscating the reality of the product through irrelevant messages based in humor and catchphrase?

There are likely a variety of reasons that these marketing initiatives are perpetuated within the insurance industry, and they are likely backed by behavioral economics and consumer psychology studies. Nevertheless, the effect these campaigns often have, due to their messaging, is to convince the consumer that all insurance buying experiences are created equal. The only remaining differentiation? Price.

Too many independent insurance agents have adopted this mentality, informing clientele of little more than the bottom line on the policy declarations page that reads “Annual Premium Due”. Losing sight of the added value you, as an insurance consumer, can receive by working with the right independent agency and buying coverage from the right insurance company may limit the benefits you can realize by buying an insurance product.

Experiences with insurance buying and product offerings can be vastly different depending on the company through which your coverage is written and the process your agent employs to write your policy. Here are a few things you may want to consider before buying your next insurance policy:

1. Has the product I am buying been explained to me?

Whether you are buying insurance through an agency or through a direct call center, the product you are eventually going to spend your hard-earned money on should be adequately explained to you. Many times, when calling a direct sales line, you may be responsible for selecting the exact coverages that are placed on your policy. If you are buying an auto policy through a call center and you aren’t familiar with terms like, Tort Option, First Party Benefits, UM/UIM, or Combined Single Limit, it can get very confusing, very fast.

Likewise, an independent agent should be willing and able to explain all these options to you and discuss the appropriate selections for your life circumstances. If these things haven’t been adequately explained to you by your agent, there are agents out there who are more than willing to help you navigate your options, the costs, and provide advice and expertise.

2. Does the agency you called have longevity?

It seems obvious, but partnering with an agency that has been established for a considerable amount of time provides you with additional peace of mind and security. New agencies and insurance offices pop up on new corners every day. Often, these offices close after a few years, causing your policies to be transferred to a call center for servicing, or forcing you to look elsewhere for insurance once again.

An agency with a historical presence in its community, which has weathered the fluctuation of market trends, is an agency that can provide you with insurance solutions for the present and the future. Agencies with a proven track record often have more resources and product availability, providing their clients with more options. Additionally, an established agency maintains agents and support staff with decades of combined industry experience and a wide array of product knowledge.

Partnering with a well-established agency, one with longevity, and a reputation of commitment to their clientele and their community, provides you with additional value and peace of mind; they were there yesterday, they are here today and will be tomorrow.

3. Is your agent quantifying their service?

I’m sure you have yet to encounter an insurance agency who doesn’t advertise their “great service”. If you concluded that all insurance agencies offered “the best in customer service”, no one could blame you. Insurance agencies sometimes lack in creativity; for the most part, agents didn’t enter the industry for their robust artistic visions but due to their analytical thinking and ability to develop logical solutions for their clientele. Too many agencies provide you with ambiguous marketing taglines that fail to establish an accountable expectation. The problem lies in that “good” is not defined the same by everyone.

If you are buying a product from someone, they should be able to give you a timeline for delivery, and a relatively close description of the process you should be able to reasonably expect. Turn around time for document requests, processing time for policy changes and endorsements, schedules for billing and realistic quote return times can, and should, be explained to you. If you’re finding it hard to get that information, you might benefit by doing business with an agency that can provide you with those details.

4. Can you trust your agent?

Let’s be realistic. Insurance companies and insurance agents are often viewed less than positively by the general public. Some of the perspective and/or criticism is likely earned, and some of it may be a result of misinformation or misunderstanding. Regardless of the reason, many people don’t trust the agent they are talking to. Trust is earned over time, but finding an independent agency with an upstanding business model, and commitments to higher standards of business ethics can help to establish an environment of mutual trust and mutual respect between you and your agent.

For example, at Ruhl Insurance we do not have agents who are compensated solely on a commission based model. This means that our agents are not paid based on whether or not they make the sale; they are paid based on how they service the agency’s clientele. This means they are better equipped to provide you with honest and unbiased advice. Surprisingly, this also means that, on occasion, you may hear us tell you that your best value is to stay with the company with whom you are currently insured.

Likewise, before offering you additional insurance coverage, we will have a conversation with you about what you really need to insure and what risks you can afford to self-insure. You might also hear us acknowledge the realities that insurance feels like a bad deal until you need it, or that we don’t enjoy paying our own insurance premiums either.

At the end of the day, we are here to protect you, your family, your standard of living, your business and your assets, and the real product we sell is the value of a good night’s sleep. We feel that transparency about the insurance product and the buying process is the best way to establish a relationship of trust with our clients.

Surely, in today’s marketplace, price matters. In fact, it may always be king. However, if you seek to better understand the product you are buying through discussions with a reputable agency that you can trust, you will be able to make educated and informed decisions when purchasing a policy. When you experience a different kind of insurance process, it becomes quickly evident that insurance is more than that “Annual Premium Due” line.

Disclaimer: Information and claims presented in this content are meant for informative, illustrative purposes and should not be considered legally binding.