This following is an article by guest blogger, Aaaron Lipson of FounderPro about the perils of buying coverage based upon price considerations alone. In the past we have spent much time blogging about quality of coverage. Even our competitors often focus upon coverage over costs (even when we can point to coverage flaws in their programs). Some past blogs were:
With professional liability insurance, the old axiom, “you get what you pay for” rings true.
National Business Development Leader at Founders Professional
As a business insurance marketer, I get infuriated every time I hear an insurance company or agency spouting “switch to us and you’ll save money.” I’m going to let you in on a little insurance secret — if you want to save money on your insurance — do not, I repeat, DO NOT automatically buy the cheapest insurance policy you can find.
If you want to make sure you get the coverage you need at the best price, enlist the help of a knowledgeable insurance agent. They know what your exposures are and will look out for your best interests. Good agents can negotiate the coverage you need and will work hard to stay within your budget.
“The most expensive insurance policy is always the cheapest one.”
I don’t know who coined this phrase, but boy, is it true! I’ve been in the trenches of insurance for over 15 years (on both the retail and wholesale sides) and I have seen individuals, businesses, and professional firms (very smart ones) purchase a far inferior insurance policy only because it’s a cheaper premium option.
I get it. I’m a consumer too. The difference is, after working in the insurance industry every day for over fifteen years, I can see the full picture. I’ve seen what can happen to folks who only focus on the premium as the deciding factor in their insurance policy purchase. It’s only after a loss occurs that they find out what they thought was covered, isn’t covered. The insured can end up paying exponentially more for a claim than if they had invested the time and money to work with their agent to make sure their coverage would protect them in the case of a potentially catastrophic loss.
When you work with a trusted agent, they can make sure you are prepared for those worst-case scenarios. You’ll have peace-of-mind knowing that this brief hurdle will be easily overcome, because you took the right proactive approach when thinking about the risks you could face.
Don’t be short-sighted, friends. You buy insurance to manage risk and help mitigate costs when a loss occurs. Help your agent help you. Be honest with your agent about your exposures. When you truly need the insurance, you want to be sure that it does what you intended it to do when you purchased it initially. But whatever you do, don’t just buy the cheapest insurance policy you can find. I promise you — it will cost you a lot more money in the end. Insurance is just like everything else in life — you get what you pay for.
What do you think? What has your experience been with this? Leave your comments below.
About the author
Aaron Lipson is the National Business Development Leader for National wholesale insurance brokerage, Founders Professional, and National MGA, Founders Specialty. He has been involved in the marketing and sales of property and casualty insurance solutions for over 15 years. Aaron can be reached at firstname.lastname@example.org.
Jorgensen & Company are not attorneys and do not offer any form of legal advice. Consult with appropriately qualified local counsel for more assistance. Rickard Jorgensen is President and Chief Underwriting Officer for the CPAGold™ program and may be contacted at (201) 345 2440 or email@example.com.