Considering all the things consumers do to make their insurance
agents' lives difficult, it's no surprise that the job can be
highly stressful.
You may not realize is that failing to be open and upfront can
do more than frazzle your agent's nerves. It could end up costing
you money when it's time to file a claim.
Insurance agents have slightly higher than expected rates of
death from
ischemic heart disease
. According to the Centers for Disease Control (CDC), from 1984 to
1998 such deaths for white males in insurance sales occupations,
age 64 and younger, were almost 6 percent greater than expected.
Could the behavior of insurance customers be shortening agents'
lives?
Here are five things policyholders frequently do that undermines
their own coverage while raising their agents' blood pressure.
Failure to admit you don't understand your
insurance
Kevin Foley, a New Jersey-based independent insurance agent,
says his foremost stress-inducing "bugaboo" is with
insurance
customers who are afraid to admit that they don't understand their
policies.
Foley has a problem, he says, "When I say to you, 'Do you
understand what I'm explaining to you?' and you say, 'Yes,' but
your eyes tell me 'no.' . . . The decision you make today could be
affecting you years from now, so I need you to understand what I'm
saying. If you don't understand, I'll go over it again, that's not
a problem. . . . I don't mind if people don't buy the more
expensive option, but I mind when they buy the cheaper option
without understanding what it means."
Foley was recently asked by an auto mechanic if he could beat
the mechanic's current auto insurance price. "I looked at it and
realized I couldn't," Foley says. "But I told him I believed the
policy needed a tune-up."
In New Jersey, the maximum auto insurance hospitalization
benefit is $250,000, while the minimum deductible is $250. The
mechanic's policy called for $15,000 in hospital coverage with a
$2,500 deductible.
"He didn't understand the choice he had made," Foley says.
Withholding important information
The biggest stressor for many agents is insurance customers who
fail to divulge important details about their situations, says
David Suarez, a spokesperson for Mercury Insurance. For example, a
client may fail to mention the number of household members who
drive a vehicle. Some people fail to mention that their roommates
occasionally drive their car. Some fail to mention that their car
has expensive extras, such as custom wheels, that require
additional coverage.
"The withholding of information is fairly common," Suarez says.
"It could result in the claims process being slowed down if those
facts have been withheld and the insurance carrier was not aware.
It makes more work for the agent, and the client is upset. It's not
good for anyone."
Christopher J. Boggs, director of education for the San
Diego-based
Insurance Journal
's Academy of Insurance agrees that customers who withhold
information are a headache. An example is the policyholder who buys
a new car or sells an old one and doesn't tell their agent.
It's not unheard of for a policyholder to have his or her new
car dealer call an agent from the dealership to provide information
about a vehicle the policyholder is buying. The agent goes ahead
and changes the policy, adding the new vehicle.
"But something happens after the phone call and the deal falls
apart," Boggs says. "You guessed it, the insured forgets to tell
the agent that the deal fell through and the change should not be
made."
Not providing a backup phone number
Sometimes an agent needs to reach clients quickly and they can't
be found. A major source of heart-palpitating angst among agents is
failure of customers to provide them with a secondary way to reach
them, such as a cellphone number or an email address.
"Your policy may be in danger of lapsing," Suarez says. "Or
there may be additional information required by the carrier. Or
there may be changes about to take place in your policy you need to
be aware of. The agent needs to reach you in a timely fashion. And
sometimes it can be quite time-sensitive."
Failing to look at your policy every now and
then
After engaging in a rigorous
car insurance comparison
, customers often buy a policy and never revisit it again.
"Yet people will spend more time and effort considering a single
feature of a flat screen TV," Foley says. "It's a bugaboo to me
that I've been in Best Buy and watched people buying TVs, and
noticed how detailed and probing they can get. Yet they would never
call me back and review coverages they made a year ago. I'm trying
to protect you in the event of an accident. Life circumstances
change."
Foley stresses the importance of revisiting life insurance
policies.
"You buy a policy when you're single, and now you're married,"
he says. "Or you buy one when you're childless, and now you have a
child. . . . If you're single, and you go on the cheap, that will
be in effect when you have a child, and you have others . . . to
protect."
Here are
common questions about life insurance
.
Unwillingness to pay premiums on time
Could it be that MIA premiums sometimes leave agents DOA?
Foley's final grievance - and one shared by other insurance
experts -- is policyholders who pay late every month.
"You're going to be burned -- your policy is going to be
canceled," he says. "The insurance company sees you're a late payer
month after month, denies reinstating the policy and tells you to
go find coverage elsewhere. And that will be more expensive."
This is a stressor Boggs got to know firsthand in his days as an
agent.
"Chronic late payers made it necessary for us to call the
insurance carrier to report payment," he says. "Most chronic late
payers move into the realm of the habitual cancel/reinstate client.
[They are the] ones who cancel every month, and come running in at
the last minute to pay in the agent's office, again requiring the
agent to call the carrier, get a reinstatement and a rewrite
without a lapse."