Independent insurance agents are finding that consumers are making significant and costly mistakes when they are purchasing insurance over the internet. In a recent survey of Virginia independent insurance agents, 31 percent indicated that they have had to correct costly mistakes that consumers have made when they have purchased insurance on-line.
“Unfortunately our insurance agent members are seeing the consumer after there has been a fire or an accident and the consumer finds that they are significantly underinsured or have even purchased the wrong insurance product,” stated Robert N. Bradshaw, President & CEO of the Independent Insurance Agents of Virginia (IIAV). “One of the most common occurrences we found is that the consumer thinks that they have found less expensive insurance only to find that their limits of coverage are significantly less – they’re comparing apples to oranges at a click of a button.”
“The problem could even be greater than our survey suggests as many of our members specialize in commercial insurance,” noted Bradshaw. “Plus the research suggests that a lot of people may not even be aware that they are uninsured – they just haven’t had to file a claim yet.” In response to the survey, Joe Hudgins, Vice President of Industry Affairs for the IIAV observed, “Too many times consumers ‘shop the net’ for personal insurance thinking the premium will automatically be cheaper. Unfortunately that cheaper premium is often achieved by lowering limits, reducing coverage and delivering inadequate customer service.”
Agents found consumers not purchasing the right amount of coverage or the wrong coverage entirely and having inadequate liability limits. In addition, consumers appeared to forget to cover their property contents and misunderstood deductibles and what they applied against. Prior to obtaining a license to sell insurance, insurance agents must pass a rigorous examination and then must take continuing education courses every two years in order to maintain their license. “The bottom line for consumers is clearly, if you’re going to purchase insurance on-line then you’d better do your homework in advance,” stated Bradshaw. “Otherwise there’s something to be said for the personal service you get from your independent insurance agent.”
Founded in 1898, IIAV is part of the nation’s oldest and largest associations of independent insurance agents and represent a network of more than 300,000 agents and agency employees nationwide and over 7,000 in the Commonwealth of Virginia. Its members are insurance businesses that offer customers a choice of policies from a variety of insurance companies. Independent agents offer all lines of insurance – property, casualty, life, health, employee benefit plans and retirement products.