How to choose a good Insurance agent for your home
Choosing a good insurance agent can seem like a daunting task. After all, how do you know what to look for in a good one? What types of agents are there and how can they help you exactly? What types of policies are there? How do insurance agents make money? What benefits do they offer you as a home renter or home owner?
All of these questions are valid and demand your attention because after all, your home rental or home residence is typically the greatest asset you will own. It pays to invest a little time in finding a good home insurance agent. Our goal is to help make the process easier by providing you this guide to finding a home insurance agent. But, initially, finding a good insurance agent starts with you.
You need to be willing to educate yourself a little about what to look for and what to look out for. Our guide, is the first step in that process.
Make sure Insurance Agents are licensed
in the state they work in
Take note of the number of years the agent, and agency, have been in business. Ideally you want someone who has been doing their job for some years. By now they should have built a solid, reliable clientele.
A long time invested in a career is surefire indicator that they like what they do and that they are reliable. Also check how long they have been with the company they presently work at.
Inquire about the Professional designations
the agent may have earned
CPCU (Chartered Property and Casualty Underwriter) is among the industry's most rigorous and prestigious professional designation. Such a description shows the agent’s willingness to work hard and to be a reliable agent. It doesn’t guarantee that they will be a good agent, but your chances are far better if they have this designation versus not having any designation at all.
Recommendations and referrals
Just like in most business, referrals from trusted friends and family can oftentimes lead you to a good insurance agent. If someone you know recommends one, ask your friends and family how they heard about the agent and the agency? Did someone they trust refer you to them? Did they have a good experience?
These questions are important. The bottom line is f you don’t know what agent to look for you can ask your friends whom they would recommend. It is also advised that you ask the agent himself for a few referrals from past and or current clients they have assisted.
Developing a long standing relationships with an agent
A survey by the Independent Insurance Agents & Brokers of America (IIABA) found 3 of 4 insurance consumers use an agent when purchasing personal insurance. More than half the respondents over age 55 had purchased insurance from the same agent for at least 20 years. More than 60 percent said they value the opportunity to discuss their insurance with a real person.
Make sure they do a Policy review
Make sure the agency occasionally reviews and updates policies to make sure your insurance is keeping pace with changes in your current situation. This is very important, as the value of our property will surely change over time and you want to make sure you have adequate policy coverage.
Be sure to keep all documents related to new construction and or additions to your propriety, as they will come in handy when the agent will need proof in order to arrange any dealings on your behalf.
Check the agent’s Community involvement
Community involvement means the agent is serious about developing a deep base of clients in your area. In some sense it shows he is committed to working in your area and will not be moving any time soon. So, you should be thinking of the following questions: does your prospective agent participate in any local organizations, boards, volunteer activities and other civic endeavors?
Keep in mind, if he or she doesn’t work in the community, its ok, but if they are it is a sign that they value their trade and are eager to establish and maintain a good standing in the community they support. It also adds to their reputation and gives them more reliability in the eyes of the community. Plus, it shows they are smart. Building community trust is, after all, essential to finding clients. Good agents will be involved.
Industry associations
Does your agent participate in any local, state or national trade associations? Such activities often signify professionalism and a commitment to continuing education in the insurance field. Pay close attention to what associations they belong too. In fact, do a search on the internet to find out more about those associations. Sometimes unscrupulous agents may just belong to any litany of ABC sounding organizations because it conveys that appearance of professionalism. So, there is nothing wrong with checking up on any organizations an insurance agent claims to be a part of.
Independent agents
An Independent Insurance agent is sometimes a good choice, as they do not work for an agency. They typically offer you the same service as someone who does work for an agency, but in a slightly different manner. For example, unlike other agents, an independent insurance agent is not beholden to any one company. Thus, you don't need to change agencies as your insurance and service needs change. This can mean working with independent agent offers greater flexibility.
Also, they Offer you a choice of insurance plans and programs, while other agents that work for a company might only offer you only the plans their company is pushing. For example, they might compare insurance coverage from an average of 8 insurance companies. An agent who works for a specific company is not allowed to do that. An independent agent can periodically review your coverage to keep up with your changing insurance needs. There is also a chance they might treat you better than an agency agent, just because they are committed to customer satisfaction because it's the key to an independent agent's livelihood and that is always a good thing.
Independent agents are preferred by some. If you want the best in terms of coverage options and prices, you should call an independent insurance agent. Independent agents represent numerous companies, each of which has a broad range of product offerings. These agents do derive their income from their companies, but they are not employees of any insurer. They are not as bound by specific regulations as those who work for a specific agency.
Full-time agents
It is usually recommended that you choose an agent who is in the full-time business of home owner’s insurance and not just selling insurance as a means to augment another job.
An agent who also does auto insurance or life insurance might not be a bad bet, but will not be as specialized. They also might not be as up to date on the current information on a specific field such as homeowner’s insurance, which is constantly being regulated and updated, and developed. Full-time agents are usually always up to speed about the latest changes that impact their business.
Make sure the agent you are interested in is knowledgeable about the area where you want to live in too. That will improve the chances of them knowing the type of insurance you are likely to need. You should ask questions about the area you live in, to test their knowledge of it. Is the house on a hill or in an area prone to flooding? Those are just some of the questions you should think about asking.
Other facts to consider
It is a good sign if your agent is a member of a trade association such as the National Association of Realtors (NAR). This means the agent is privy to listings, market information, and other data that nonmembers must struggle to obtain.
It is a positive if your agent is a recipient of additional credentials. Look for initials on their business cards -- for example, NAR offers such credentials as a “GRI” (Graduate Realtors Institute) or the even more advanced “CRS” (Certified Residential Specialist). There are not too many of them with so many credentials, but those credentials speak to their abilities and interests in furthering their career. Be sure to Interview the potential agents
Once you’ve got a short list of promising real estate agents, let each know you want to interview him or her for 30 to 45 minutes, preferably in person at their office. You’ll be testing not only the agent’s knowledge, but his or her cooperativeness and punctuality and professionalism. Plus, you will get a good feel of how well you will like working with this agent. Below are suggested questions to ask a potential agent:
How many homes have you insured for buyers in the last year?
Ask for the addresses of these recent transactions, and find out the selling prices of those homes in that area. This will help you see whether the agent truly works with clients similar to you and how successful the agent has been.
How can you help me afford the insurance I need?
If you are looking to get a home, ask the agent what you can expect for your money, and for suggestions on special and new mortgage loan programs and recommended mortgage brokers. Also ask about recent insurance and tax changes to see that they indeed know their stuff.
How will they communicate with you?
Will the agent call you, or use email? How often will you hear from him or her? Will you golf with them on the weekend and play doubles on the tennis court?
How do they organize their work?
Ask to see logs, checklists, worksheets, and other tools or documents the agent uses to keep track of the various details. If they are disorganized, do you want them handling your insurance needs?
Get names of past clients that can serve as references for you?
If you think you might hire this agent, be sure to follow through with these calls!
Paying for your insurance
Make sure the agent and company are legitimate before you start spending your hard earned money. The last thing you need is to fork over a bunch of cash to only discover the agent is no longer in the business a week later. Here some dos and don’ts:
1. Do not pay cash.
2. Do get a receipt for all payments.
3. Do be sure the receipt shows your policy number, date of payment, period of coverage, and name of insurance company providing the coverage.
Read the policy carefully when you get it
Yes, that is right. You should actually read the policy when you purchase it. The worst time to discover what isn't covered is after you have a loss. This happens to a lot of people, who simply do not want to be bothered with little details listed in a contract and find it tiresome to read, or have complete trust in their agent. Remember, your agent is not perfect; they might make mistakes, so it never hurts for you to read through your contract carefully.
What kind of reputation do they have?
Choose an agent from an agency with a good reputation. You can always check your state insurance department to find out more about the companies, and their reputation. You can even check with the local chapter of the Better Business Bureau to see if any complaints have been lodged against an agent.
Test the agent’s Availability and Communication
Choose insurance companies and agents that will not be impossible to reach when you need them the most. Think about what's important to you. Is it a national company with local representation, or is their online presence as strong as their offline presence? This is important and can make a big difference. Check their Internet presence and see if they offer enough online that you can live with.
Test their customer service
We all hate to dial a number and listen to computer voices tell us to endless pick option after option. Whereas, we love it when we dial a number and a knowledgeable customer service representative fields your call in a timely and professional manner.
So it would behoove you to check the insurance company's customer service and support to see how good it is. To do so, call up the insurance companies' toll-free numbers and ask them questions pertaining to your issues related to different insurance policies.
Make sure you select a company with knowledgeable representatives, who are specially trained to answer all your questions related to coverage. They should also be able to respond to your claims efficiently and quickly.
Choose the kind of agent you want
A captive agent will only represent one company. All his solutions to your problem will be solved by recommendations from his company. Consider that since no company has a product line that is the best in every area you use an agent or agency that can represent a variety of companies. You are likely to find better price and product with more choice.
Some other important questions to ask an agent when determining if they are right for you:
1. How long have you been in this business?
2. Can you represent many companies?
3. How do you get paid?
4. Has your license ever been suspended?
Compare
Shop rate quotes to get Insurance Agents to compete for your business. When agents compete for your business you win! Then follow this process to assure you are getting a good price with a strong home insurance company that you can trust.
Verify agent or Brokers license. The License Registry is an affiliate of the National Association of Insurance Commissioners (NAIC). All complaints, suspensions arbitrations and other issues are here. Be sure to get your agents Insurance license number, it is often on business cards or letterhead.
Check the National Association of Insurance Commissioners web site at http://www.naic.org to research the number and type of consumer complaints outstanding against a company. Like we said before, you can also check with your local Better Business Bureau. They have an area where you can check out an organization. If you discover too many complaints then you should go elsewhere, even if you like the agent. Trust us on that one.
Check the Agent (and Agent’s Company’s) Financial Ratings
So you often wondered why employers ask to see a potential job candidate’s credit scores prior to hiring them. The answer is because is shows responsibility. The beauty of that is it works both ways. You can check out a company’s finances to determine if they are a responsibly and fit for you.
Your Insurance Agent’s ability to pay is everything. Shop wisely and you will be better protected if disaster strikes and you need to them to open the check book. Here is how they are usually scored:
Rating
What it means
AAA
This is the highest rating given and the company's ability to pay is very strong.
AA
Standard and Poor’s tells us the difference between AAA and AA is slight.
A
The company is subject to economic swings; perhaps it carries high debt or has made some riskier insurance bets. The company ability to meet obligations is still strong
BBB
This rating is reserved for "adequate". The company is more likely to run into difficulty during hard times.
It’s easy to see that the financial ratings of a company’s ability to pay under some circumstances could translate into a longer time before you see a check or really narrow definitions applied to problems you have. Stay with the higher ratings. Compare similar coverage using an AAA company against AA and single A company. Yes, an AAA company is probably more expensive but sometimes you did get what you pay for.
Stay with a company for the duration
Some say familiarity breeds contempt, but that is usually not the case when you build a strong relationship with an insurance agent. If you've kept your coverage with a company for several years, you may receive a special discount for being a long-term policyholder. Some insurers will reduce their premiums by up to 5-percent if you stay with them for 3 to 5 years and by 10-percent if you remain a policyholder for 6 years or more. Just make certain to periodically compare this price with that of other policies. You don’t want them to take your business for granted after all.
High risk areas
If you live in a high-risk area -- say, one that is especially susceptible to coastal storms, fires, or crime -- and have been buying your homeowner’s insurance through a government plan, you should check with an insurance agent or company representative or contact your state department of insurance for the names of companies that might be interested in your business. You may find that there are steps you can take that would allow you to buy insurance at a lower price in the private market compared to what you are paying now.
Get a broker to help with your search. Contact at least five different agents. Consider using an insurance broker who can help you comparison shop. Namely the benefit to a broker is that they will have a network of partners that can more than adequately meet your needs. They should be able to shop around for you and get the best deal or some preferred rate through one of their partners. Naturally, however, with the middleman, there will be more fees, but often times these fees are worked out between the Insurance Company and the broker.
The last word on finding a good agent
Good agents are essential to protecting what is oftentimes your most valuable asset: your home or home rental. It behooves you then to spend the time to learn about all the types of insurance products that are available to you and which of those products can provide the protection you need in the event of a disaster. A good agent can help explain and make sense of all those products. So, if you find a good agent, you will in a sense, be finding a good insurance product close behind as well.
You want an agent that professional, entrenched in the community, steeped in the knowledge of his trade and who has an established track record of helping people just like you. You should have learned by now when it comes to insurance agents for your home or rental one size does not fit all. You need to think about what is important to you in terms of insurance coverage, customer service, personal attention and the list goes on. However, we are confident that having read our guide, you will be well on your way to finding that perfect insurance agent for your situation. We wish you much luck.
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