The relationship between you and your
agent can be an intimate one. Chances are good he or she knows
things about you that even your best friend doesn't know, such as
what valuables you have and what they're worth.
Even the breed of your dog is subject to scrutiny as your agent
determines whether you are a good risk for liability coverage. Some
home insurance companies have lists of breeds and crossbreeds they
won't insure because they are considered too aggressive. So don't
try to pass your pit bull off as a Labrador.
As well as he or she comes to know you
you'll never find out how strong your agent's friendship is until
you file a claim that is rejected by your
Tension over home insurance claims
In most cases, home insurance agents are able to maintain a
delicate balance between being a client advocate and a loyal
company representative. Things can get complicated if the insurer
disputes your claim, however. In some cases, the person who
provided so much help and guidance when you were looking to buy a
policy may stop returning your phone calls.
Not all agents give their clients the cold shoulder when a
homeowners insurance claim is disputed, but "it happens," says
Kevin Foley, an independent agent in Milltown, N.J. "I've talked to
people who say, 'My agent stopped returning my calls,' and that is
a shame. When someone has a problem, you have an opportunity to
shine. It wasn't you who denied the claim, it was the
Divided loyalties among insurance agents
Peter Moraga, spokesperson for the Insurance Information Network
of California, says it's best to keep your expectations for
insurance agent support in check. Agents can still provide
assistance when a claim is rejected, but some may worry about
appearing disloyal to the insurance company that pays their
Amy Bach, executive director of the United Policyholders
consumer group, says some
are more helpful than others when claims are rejected or
"It depends on the personality of your agent," she explains. "If
your agent is really loyal to you and uses his connections with the
company to help you, you can continue to take advantage of that
advocacy. One of the things that sets a good agent or broker apart
is the willingness to fight for a client in a claim dispute. The
good ones will."
Even agents who are willing to help likely will distance
themselves when matters move into a courtroom. "Certainly, the
reality is when a lawsuit is filed everybody retreats to their
camp," Bach says.
Moraga agrees. Agents may start out as your advocate, "but once
a lawsuit is filed, that changes completely."
Policyholders aren't the only ones who feel betrayed during the
claims process. Your agent's loyalty to you may waiver if he or she
believes you have filed a fraudulent claim, says Kevin M. Lynch, a
longtime insurance agent who now works as an assistant professor of
insurance for The American College, based in Bryn Mawr, Pa.
"You have a customer, you have a great relationship," he says.
"He files a claim and the nature of the claim has a lot to do with
how solid the relationship remains. There were occasions when I
believed in my heart I was dealing with a fraudulent claim. People
would call up after a hailstorm asking if they could get a new
roof. I would ask, 'Did you sustain damage?' They said, 'I don't
know, but everyone else in my neighborhood did.'"
Keeping their job
Sometimes insurance agents are caught between a genuine desire
to counsel clients and their need to remain employed. The pressure
exists for both independent agents and "captive agents" who work
for a single company. Doug Heller, executive director of the
Consumer Watchdog group, says independent agents who work for
several insurance companies may be the most willing to provide help
during a dispute. Even so, "at the end of the day the agent is
legally tied to the company, not to the customer."
Lynch acknowledges that insurance agents "have to be careful"
about how they intervene if a client's claim is rejected.
"Yes, you are going to advocate on behalf of your client, but
you are an agent of the company," he says. "You have legal
restrictions. You work with your ethical and moral code and do the
best you can for folks in areas for which you have authority."