If you are like some others who pout their lips when they meet life insurance agents, this post is for you. They are not useless commission-consumers, as you might have been considering them to be. The fact is they are not match-fixers. Instead their role is that of the match-makers for you.
You’ll Be Surprised to Know
Yes, you will be surprised to know that if you are in need of life insurance, you cannot do without an agent. No matter you buy life insurance online or offline from the HQs of a life insurance company, you cannot process your application without the recommendation of a life insurance agent.
Mistaken Ideas About Life Insurance Agents
Agents Make Rates Go High
There is a huge misconception about the job of life insurance agents. Most people think that because life insurance agents are given fat commissions from your pocket, they cause the life insurance premiums to go high.
That’s totally wrong. Your life insurance agent has nothing to do with the rising or the lowering of your policy cost. Insurance companies determine your life insurance premiums according to their unique and complicated rating system that conforms to the risks that they assume they take by insuring you. No matter you have an agent there or not, the cost does not change.
Agents Are Useless
Many buyers consider that there were no need for life insurance agents. But if you review the way they work for you, your idea should change. They play almost the same role that finance experts do. They help you understand the policy that suits to your need best. They compare and contrast policies so that you may have a clear understanding of what you should buy or not buy. They also help you understand how much life insurance you should have. In fact, life insurance agents play a very useful role in the shaping of your financial planning.
You might think that the ties between your life insurance agent and you are temporary. This might be one of the biggest myths you have catered to so long. The fact is the relationship between an agent and a policyholder is permanent. You need him when you would want to update your policy, change the beneficiary or even when the time to proceed with the claim the benefit comes.
Life Insurance Agents Push Products
A common mistaken idea about life insurance agents prevails that they push products that are especially profitable for them.
While there is truth in the belief, it is not always the whole truth. Not all agents push products. Even though some do, they do because the buyers unknowingly choose them.
Sometimes, whether an agent will push a product or not kind of depends on you.
There are two types of life insurance agents: company-bound and company-independent. An agent of the former category works for a particular company and sells the very products of the company that he belongs to. Such a life insurance agent might be pushy.
On the other hand, company-independent agents deal with several companies. They typically will bring you options to choose the policy or company that suits your need best. Even if you find someone to be pushing a particular company, you have the choice to decide for yourself.
How to Choose A Life Insurance Agent
As your life insurance agent is an integral part of your financial planning, you need to be careful about choosing your agent.
You can go for company-bound agents when you have a trusted company in your mind. Else, an independent agent is who you should go to. An independent agent is the best fit because:
He will not push any particular product or company. He will only explain different products to you so that you may decide what you should buy. He may be recommending some product in an explanatory language but will never sound too persuasive or insisting. Trying to allure you to buy some particular product is not characteristic of an independent life insurance agent. If you are seeking to buy term insurance, an independent agent will not recommend that you buy whole insurance.
What Else to See
You need to see that the life insurance agent who is dealing with you is a licensed one. You can check whether your agent is licensed or not by visiting your state life insurance commissioner’s website.
Also, it is important that your agent is professional enough. Unless your agent is properly professional, you are not going to get help from him in future.
Besides, a life insurance agent should not be too young. Too young agents often change their careers and move to new jobs. As an agent often works as an intermediary between your insurer and you should make sure that the link does not get broken.
Sometimes life insurance agents may produce fake policies or play fraudsters with you. National Association of Insurance Commissioners (NAIC) warns consumers of fake insurance companies or agents and fake policies. Surprisingly, fake policies from genuine companies are not a myth. Unless you are cautious, it is often impossible to realize this until the beneficiaries claim the death benefit.
So, make sure you are choosing the right agent for your family’s future protection.