Do you know that in 2010, it was discovered that more than half of insurance buyers in America are nervous when making insurance buying decisions? This is according to The National Association of Insurance Commissioners.

So, you see that being hesitant about committing to an insurance policy coverage agreement is not such a bad thing. Insurance can be very confusing for a lot of people but in order to make it less confusing, you should ensure that you ask your insurance agent some of these tough questions to be sure that you are on the safe side and protected. You should be able to trust your broker/agent and to achieve that, you have to ask the right questions; regardless of how tough or stupid the questions seem.

10 Tough Questions to Ask Your Insurance Broker / Agent

1. What is your qualification/experience-: You don’t even want to know how many quacks are out there parading themselves as insurance agents. To avoid getting mixed up with such people, it pays to ask questions about the qualifications of an insurance broker. You can ask to see his license or look him up at the licensing board to be certain he’s legitimate. You should also look out for disciplinary records to find out if he has had any cases of professional malpractice in the past.

2. Do you offer support during claims processing-: You should also ask your insurance broker how long it would take to process your claims if you ever had to file one and the level of support he would provide. The whole purpose of buying insurance in the first place is so that you can have easy access to claims whenever you need them and your insurance agent must be able to show that he would be ready to support you and help you file claims whenever you have to.

You may also want to check his records to see how many successful claims he has helped to file in the past. Another thing to find out is the total amount that would be accrued and payable to you during claims. At least, you would be able to know how much more you would need to save in-case the accrued sum would not be sufficient to repair the damages.

3. Are there alternatives to the insurance policy-: Insurance serves one major purpose and that is risk management. However, insurance is not the only way to manage risks. Insurance is quite expensive and sometimes there might be cheaper alternatives. Your insurance agent should be able to tell you if you really need to buy policy coverage and if not, the alternative ways to protect your business from risks.

4. How are Premiums calculated-: A lot of people skip this step and just buy insurance without demanding to know how their premiums would be calculated. A lot of factors are considered before your premiums are determined and a good insurance broker should be able to tell you some of the things that may work against you and how you can improve these things so that you can get better premiums.

For instance, if you have bad credit reports, your premiums would be higher and your insurance agent should be able to inform you of this and suggest ways to improve your credit and access cheaper premium rates.

5. Which insurance companies do you work for as an agent-: You should also find out if the agent would be able to offer you competitive quotes by finding out which insurance companies he represent. An insurance agent who works with a lot of insurance companies would have access to different quotes and would be able to offer you a variety of products and prices.

6. Do you have any references-: You should also be able to ask your insurance agent for contacts of past customers, so that you can get honest, unbiased reviews that would help you make a decision as to whether the insurance agent is customer service oriented or otherwise. A professional broker who offers good services should be able to provide you with a list of satisfied and happy customers that you can discuss with.

7. What caliber of clients do you cater to and how many are they -: You should also consider the caliber of clients that the insurance agent serves to determine the level of attention that you would receive from him. For instance, if you are just a small business owner buying limited coverage, going for an insurance agent who serves big businesses and corporate clients may not be good for you as you might receive less attention from him.

8. What’s your level of communication with clients-: Another question to ask is how often the insurance agent communicates with his clients. This is very important so that you can always be informed of trends in the industry as well as anything that may affect your own coverage or claims. Good insurance agents who have the best interests of their clients at heart would usually send regular newsletters to their clients to inform them on latest happenings in the industry.

9. Are there clauses on the insurance policy you are recommending-: You should also ask your insurance agent to educate you on any clauses that are not spelt out in the contract that may affect your claims in the future.

10. Do you have employees and supporting staff-: You also have a right to know how qualified and experienced the supporting staff who would be working alongside the insurance agent to serve you are.

Some of the signs that you should not hire an insurance agent include-:

  • An agent who speaks a lot of professional ‘jargon’ and doesn’t take time to patiently explain all technicalities to you.
  • An agent who tries to evade your questions and instead of providing you with straightforward answers, chooses to beat around the bush.
  • An agent who refuses to reveal the negative aspects of an insurance policy to you. Yes, you should be wary of such agents because every insurance policy comes with its own downsides and you should be able to trust your insurance agent to reveal this to you.
  • An insurance agent who doesn’t mind bending the law for you.
  • An insurance agent who doesn’t have an office or a verifiable address where you can visit in case you need to.
  • An insurance agent who is not licensed.