If you own a car, you are required by law to have car insurance. Homeowners insurance is a smart investment to protect your home and its contents from fire and other natural disasters. Health insurance? With the Affordable Care Act already in place with more provisions to come, everyone will have to have some type of health insurance. With so many kinds of insurance available and needs that change over time, your clients could be paying too much for coverage.
A survey by Bankrate showed that 37 percent of Americans are spending more for all types of insurance, including homeowners, renters, auto, life and health. Sixty-two percent of survey participants pointed to the rise in insurance premiums for the increase costs. For others, adding new coverage or a change in life circumstances caused the rise. Insurance premiums paid through payroll deductions or automatic withdrawals can be taken for granted. A person may not notice small increases over time.
Natural disasters like floods, tornadoes and hurricanes can affect insurance premiums, even though they occurred in another part of the country. Health insurance premiums can go up as well, as health care costs rise with new technology, high-cost equipment and expanded services. In the article, “Many May Be Missing Out On Insurance Savings,” J. Robert Hunter, Director of Insurance for the Consumer Federation of America, felt the number of Americans with higher insurance costs are higher than reported. Many people just aren’t aware of rising insurance costs.
The culprit isn’t greedy insurance companies. Hunter points to inertia on the part of the insured. People don’t like buying insurance and wading through all the complicated insurance language. They don’t understand the policies and tend to stay with the same insurance company rather than face the tedium of going through the process all over again. This reluctance to review insurance plans can also find individuals under- or over-insured at the time when they need to file a claim.
Insurance professionals can help clients by conducting an annual insurance audit. You can help your clients save time, money and the aggravation of shopping on their own. An audit can help retain clients and increase business when they need adjustments to stay protected due to changing circumstances. Shopping is the key. Compare insurance plans to find the proper coverage at the best price and pass the good news to the client.
Begin the audit by reviewing the current types of policies and levels of coverage. Lifestyle changes, family size and even changing interests can affect an overall insurance program. What do your clients want? Depending on their financial situation, they may want to adjust coverage to make money available for other urgent needs. As a third party, you can give valuable perspective to help them balance conflicting needs with the need to protect their family, investments and lifestyle. Update your client’s profile, and then go to work putting together a comprehensive review and proposal.
Your audit may find less coverage is needed with a significant savings for the client, and reduced income for you. This is great news for your client with a bonus for you as well. Putting the needs of your client first will bring in referrals and promote your reputation as an honest and caring professional.
Photo source: Freedigitalphotos.net
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