FALLACY #3 – Your Insurance Agent Will Make Sure You Have The Right Coverage
The third reason people think they have the right kind and right amount of insurance is because their insurance company tells them they do. When a biker needs insurance for his or her motorcycle, they have two choices. They can walk into a local insurance agent’s office or, as more and more people do everyday, they can get their insurance on line or over the phone. When you walk into a local insurance agent’s office, what do you see above the door? Probably a big sign advertising the name of the insurance company they sell policies for. So who do you think that insurance agent works for, how do they get paid? They get paid by the insurance company for selling you a policy of insurance. Let me put it more bluntly: your insurance agent works for his insurance company, not for you! And those people you talk to on the 1-800 numbers? They work for the insurance company, too.
In NY, Insurance agents aren’t like other professionals. Your doctor, your lawyer, your accountant and your architect all owe you a duty of care. They have an obligation to look out for your best interests. If they breach that duty by failing to exercise a reasonable degree of care, you have the right to sue them for it. But insurance agents are different. They don’t owe you a duty because they don’t work for you. They are in essence representatives of the insurance companies. If they fail to sell you the right kind and right amount of insurance you cannot sue them for it.
Just like every other profession, there are good, bad and indifferent insurance agents. The difficult part is telling the good ones from the rest. Since this is my book, I am going to take the liberty of generalizing about insurance agents. Because insurance agents don’t work for you, they will try to push you toward the product they sell that has the highest profit margin for them. At the same time, they will steer you away from insurance products that carry the greatest risk to their employer. They do this in the interest of maximizing their own fees and keeping their employer, the insurance company, happy. Is that the kind of insurance you want? The kind that makes your insurance agent the most money and minimizes the risk for the insurance company? If not, please read on.
Thanks for reading,
ZiffLaw Attorney, Esq.
NY and PA Motorcycle Attorney
The Ziff Law Firm, LLP
303 William Street
Elmira, NY 14901