There are two predominant trends in today’s insurance world:
- Insureds are price shopping their insurance more than ever, resulting in some of the highest turnover rates in history. Insurance companies and agents are scrambling to figure out what to do to retain their clients.
- Insureds aren’t seeing the value in having a physical agent that they can speak with and whom is personally handling their coverage(s).
For the insured, finding the cheapest route seems like a no brainer. Most people will see a commercial from a top insurance company or hear about a carrier having the lowest rates and immediately make the jump to put some weight back in their wallet. Consumers can get online at their convenience, acquire multiple carriers’ rates and purchase, all without even speaking to anyone.
However, not all insurance companies and policies are created equal. There is a misconception that everything comes down to price. When, in fact, studies have been done that show price isn’t the ultimate factor in a buyer’s decision process. Surprisingly, price isn’t even in the top five reasons that insureds cite as the biggest factor when choosing who to place their business with.
At the end of the day, the “digital” insurance companies are trading off doing what’s right for the customer for staying current and pandering to the consumers need to feel in control.
The questions you have to ask yourself are:
What happens when you need to utilize your coverage in the event of a claim?
Do you know exactly what your coverages are?
Are those coverages relevant to you and your lifestyle?
Did you, as a consumer, sacrifice anything in protection for the lower premium?
When you need to make a policy change or claim, how exactly do I do that?
Is the “15%” you saved enough to sacrifice the service you’re giving up?
Has someone taken the time to understand all of the potential risks that face whatever it is I have insured? Is all of this damage done to my vehicle, business or home, going to be taken care?
There are a lot of questions swirling around in a person’s head because they don’t have that reassurance of an insurance agent having their best interest in mind. If you, as the consumer, were driving the transaction when you purchased insurance, there’s a good chance you were dealing with an order taker and not an insurance agent.
This past winter season has been a brutal one for many across the U.S. With unrelenting weather, comes a high volume of claims. It’s when someone’s faith in their insurer comes to fruition.
A perfect example of this is a small business out of Ontario, OR by the name of Frahm Fresh Produce. They experienced a building collapse as a result of too much snow on one of their company’s roofs. A family-owned business is usually run as a pretty tight ship. There isn’t too much room for mistakes and accidents like this. Every dollar is important. So, when something tragic happens, it’s absolutely devastating and they rely heavily on the protection that they have been paying for.
On a broadcast television interview, with tears in his eyes, the business owner said, “you just hope you have good insurance.” Can you imagine the feeling of not knowing if your business will survive because you weren’t assured that you have the right coverage?
The intangibles that are provided from an insurance agent, unfortunately, go unmeasured. Especially from those that have never had the experience of good service. Having someone down the street that you can create a relationship with goes a long way. Simply being able to call or stop into the agent’s office to discuss a question or concern is a concept that has been lost in today’s society.
From the ability to have the agent personally understand your situation, to having the reassurance that someone will have your back in a disastrous situation, is priceless. The value goes unnoticed until you have to make a claim and the process becomes much more difficult without an agent by your side.
When did insurance become a low-level item that you can shop for online just like you would a pair of shoes?
Becoming an agent and having the ability to sell insurance is just like any other skilled profession. There are certifications, continuing education and experience required to provide people with the best coverage possible.
If you wanted to remove your appendix, would you go online and watch a YouTube video? If your answer is “no” (which I’m hoping it is), then why would you rely on an app to tell you which coverage is best for your needs without actually speaking to someone?
As the world becomes more and more digital, its understandable people are choosing to obtain their insurance in a similar manner. The real question is: are there certain things in the world that should always have a human element to them?