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Apples-to-Apples Agents – Please Don’t Be One

Author: David Thompson

Should I be shocked that when I ask the question of agents attending my classes, “A customer comes to you for a homeowners' policy. Do you make it a practice to and always quote ordinance and law coverage at 50 percent?" And almost invariably the answer is, “No, we just quote apples to apples."

While I'm no longer shocked, I am disappointed.

What I really want to say in class but don't is, “You are kidding me, right? The customer is coming to you with an inferior product and you don't tell them that you have something better to offer? Isn't that part of being a Trusted Choice agent?"

My “cut to the bone brutal thought" is, “If an insurance agent doesn't offer me the best product out there, why do I need them?"

The examples are endless, but here are a few of the common issues that come up in classes:

  • A CGL policy has an assault and battery exclusion.
  • A commercial property policy does not have any ordinance and law coverage.
  • A business auto policy does not have any “hired car physical damage coverage" because employees don't rent cars for business. (And of course they would NEVER do that in the future!)
  • A flood policy has only building coverage; no contents coverage.
  • A homeowners' policy does not have replacement cost coverage for personal property.

Why would any insurance professional not tell a customer or prospect, “I can offer you something better than you have – and for not a lot of money"?

Agents often tell me, “Customers buy on price; they won't spend more money." Let's think about that statement. Suppose that an agent quotes a superior product or optional coverage 100 times; of the 100 quotes, only eight clients buy the superior protection. That's a horrible batting average; no major league baseball player would stay on the roster with such horrible numbers.

That's the wrong way to look at it. Think of it this way; if the better coverage is never quoted, the “batting average" will be a big fat zero percent. If the best coverage is not quoted, there is no way a customer will (or can) buy it.

To illustrate this point, look at our (FAIA's) Education Library article titled: Uninsured Motorist Coverage: An Agent Who Gets It. The article involves Matt Carlucci of Brightway Insurance (name and agency used with permission) and his quest to offer the best coverage to his customers. He concludes his remarks with this: “I guess the last thing I'll say is that there has always been this prevailing notion in the agency force that 'customers won't pay for that,' and it's only true about 50 percent of the time, or less. It's amazing what a customer will do when you simply add the words 'I recommend…' at the end of your email, or in a conversation. People know very little about insurance, so they're looking for recommendations. Too many agents are afraid to give it."

With technology today, it's very simple to quote multiple coverage options. I go back to the days when every quote involved a pencil, paper, and handheld calculator. Quotes of five different auto liability limits involved five different “crunching the numbers" mathematical calculations. (I probably did the math wrong 20 percent of the time too!) Offering different options today is as simple as checking a few boxes on a computer screen; it takes only seconds.

Tim Dodge, AU, ARM, CPCU is Assistant Vice President of Research (and self-proclaimed “Insurance Geek") for the Independent Insurance Agents and Brokers of New York. In an article Tim wrote dealing with why agents should read the policies they sell he stated this: 

We are insurance professionals. We are Trusted Choice, for crying out loud. Maybe we're not all CPCUs, but that doesn't mean we shouldn't meet the requirements of the CPCU canons…. We have ethical obligations to the people we serve. We owe it to them. We owe it to our peers in this industry that has treated us so well. We owe it to ourselves.

Tim's comments are right on-point!

What about you, are you just an “apples to apples" person, or do you make it a practice to always provide customers with the best coverage option available? If you don't provide the options, you are making the coverage decision FOR the client – and no E&O attorney would ever recommend that approach.

Consider these points again:

  • Your clients deserve to know that better coverage is available; and it's the agent's job to tell them. Don't you want to know when there are better options.
  • If you never provide the options, you will never allow the insured to make his/her own coverage decisions.
  • If you never provide the better options, you will never sell anything more than what they already had.
  • If you never provide the options, you have made the coverage decisions for the client. Go ahead and call your E&O carrier.

Last Updated: June 8, 2018

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