Five Tips for Choosing a Good Insurance Agent

The modern insurance shopper has lots of options for buying their next insurance policy. In fact, it’s become rather fashionable to buy auto insurance online. Even business insurance startups are looking for ways to disrupt the good, old-fashioned insurance agent channel. Despite all the fuss over the latest digital distribution fads, we estimate that 80% of all insurance is still purchased through an insurance agent. This means it’s still important to know how to find a good insurance agent.

Selecting an agent can be tricky. Frequently, consumers don’t have the tools to determine what makes a good insurance agent. This doesn’t need to be the case. Generally, you’re looking for a few key characteristics.

Below we provide you with five (5) useful tips to help you select your next agent.

What type of insurance agent?

Before we can break down ways to select an agent, you need to determine which type of agent you want to work with. Will you select a captive or independent insurance agent?

A captive agent works with an exclusive contract to represent a single company, like State Farm or Farmers. Independent insurance agents cannot work with the captive companies, but they are free to work with all the other carriers. For instance, independents can represent Travelers, The Hartford, Nationwide, Liberty Mutual, Safeco, and Berkshire Hathway GUARD just to name a few.

We’re based since we’re independent, so we’ll cut to the chase … choose an independent. 🙂

Now that you’ve selected the type of agent you want to work with, let’s get you some tips to choose a good insurance agent.

Tip 1 | Do you like the agent?

You have to like your agent. If you can’t develop rapport with the agent, or worse you just don’t like them. It’s just not going to work. Insurance is an important purchase, for many, it can be a complex transaction with multiple policies. You need someone who you feel comfortable with, you’ll be sharing important details about your family and financial plans.

If you don’t like the first agent you talk with, that’s fine. Most good insurance companies have more than one insurance agent who represents them in your neighborhood. You’re not locked out. You can frequently go to the insurance carrier’s website and search agents in your zip code and start interviewing those that look interesting.

Tips 2 | Do they use hard-selling tactics?

Insurance is part of your personal financial plan, so you shouldn’t make rash decisions. A good insurance agent should spend time with you and explain the benefits and coverages offered by the insurance policy. If the insurance agent you are working with is pushing for the close, you likely made the wrong choice in an insurance agent. You might want to move on.

Tips 3 | Do they understand you?

Since your insurance is the foundation of your financial plan, your insurance agent should spend some time getting to understand your needs, your goals, and your objectives. Purchasing your insurance is about you, not them. If the agent doesn’t want to take the time to unpack your goals and objectives, you might get bad outcomes.

Tips 4 | Do they provide you choice?

When you’re shopping for insurance, like all other things, having choices is always better. You want to work with an insurance agent who can provide choice. Frequently, this means working with an independent insurance agent, they can represent several insurance companies. While captives cannot shop multiple companies, they should be able to provide you with multiple coverage options for each policy quoted.

If your insurance agent is not providing you choices, and trying to sell you on narrow coverage options, then they are failing you on choice, and in tips 2 and 3 above.

Tip 5 | What companies do they represent?

If you selected to work with a captive agent, then you likely recognize the insurance company. Heck, they’re advertising all the time. The better independent agencies will have appointments with recognizable insurance companies like Mercury Insurance, Travelers, The Hartford, or Progressive.

If you don’t recognize the companies on the insurance agent’s wall or window, you need to ask good questions about the financial condition and reputation of the companies they represent. You may want to check the carrier on AM Best or JD Powers to verify their reputation.

This should not be a deal breaker. Some companies simply don’t advertise, so you’ll not be familiar with all the good companies. This is particularly true with specialty business insurance, professional liability, and hard-to-place risks.

The bottom line

There are many ways to assess a good insurance agent. These five tips are a good starting point but don’t discount your basic intuition. Working with an insurance agent is a social transaction, you can tell a lot from their people skills. If you are looking for a new agent and want to discuss your insurance, you can always contact us, or even start a quote online.