Is An Independent Insurance Agent Any Better?
· by Matt Fox · posted April 3, 2008
· filed under Business Insurance, Insurance Agents, Personal Insurance category.
The other day a person called and asked what kind of insurance we sold. He was referred to us by another client and didn’t understand what we do. He asked, “I know what Allstate, State Farm and others offer. What’s Fox Insurance? I’ve never heard of you. That’s not traditional insurance, is it?”
I have to say I was a bit stumped. I didn’t understand and then it hit me. I replied, “We’re not an insurance company. We’re an Independent Insurance Agency…”
So, what is the difference between the insurance companies that are on every corner and an independent insurance agency?
The insurance agent on the corner just works with that one insurance company. They have a line of products from the company that they’re allowed to sell and that’s all they can offer. The insurance company builds their brand by advertising heavily and placing shops with their logo on every corner. You trust the agent because you know the company name and logo on the door.
An independent agent works with many insurance companies. They have many products to choose and shop from. They can help customers in more ways.
For example, one auto policy may offer incentives/rewards to teen drivers that are accident free. Another offers guaranteed replacement cost on your home while most only offer a percent “extended” above the dwelling amount listed on your policy. If you have different concerns than your neighbor an independent agent can find something that meets your specific concerns.
Also, as I told the man on the phone, “If you’re with a company on the corner and their rates increase, you have to call around to shop. What if the company stops selling home insurance in your state as they have in other states? Now, you are forced to break the relationship with the agent/agency. When you’re with us and your rates go up or a company changes its appetite, give us a call. We can shop the many other companies we work with and probably find what you want.”
What about claims? Since the agent doesn’t handle the claim, you have to rely on the stability of the insurance company. Just because an insurance company has agents on every corner doesn’t guarantee better claim paying or service. You can find complaint ratios for insurance companies by calling the Arizona Department of Insurance or visiting their website.
There are many variables to choosing what’s right for you. You have to think, “what do I want?” Do you want the control, freedom and options and independent agent offers? I left the captive agency system because I wanted to offer more to my clients. I’ve seen both sides and both have their challenges. However, at the end of the day, I go home feeling great now knowing I’m doing the right thing for my clients. Then again, I’m biased towards independent agents because I am one.
Related posts:
- The Real Key To Low Home and Car Insurance Premiums
- How Do You Know You Have The Best Price On Your Insurance?
- Give Yourself An Umbrella Of Insurance Protection
- Yes! You Can Monitor Your Teen’s Driving Even When You’re Not There
- AIG…Should I Stay Or Should I Go?
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