Pitfalls Of Auto Insurance

The field of auto insurance sales is a vast one with boundless opportunities for a self motivated sales professional. For every opportunity that has an up side, there are always things that must be kept in mind that could potentially lead to misfortune. I am Nevin Shennett and I have been in the insurance industry for four years.

For three of those years I have owned my own insurance agency.

What I have learned in that time has shown me what can go amazingly well and horrifically wrong in the context of auto insurance. There are countless things to be mindful of when insuring individuals on personal auto insurance policies.

You have been approached by a new client! You have gotten all of the client’s information. You have quoted the client’s auto insurance with your companies. You have gotten quotes and a few rates back from the companies. You appear to have a great deal for the proposed insured that will save them money.

Is there anything that could be wrong or that you should double check?

There most certainly is! One of the first things that should be checked is your data entry. As simple as this may sound, it is one of the simplest and most costly mistakes that can be made by an agent. Many things can be wrong in this realm. Anything from a simple misspelling of a name, a digit being off in a birth date, an incorrect address, or something more severe such as a vehicle identification number being incorrect.

Some of these things can be easily corrected and lead to minor problems, however issues such as a vehicle identification number being incorrect can lead to much larger problems. In my experience, a vehicle identification number being incorrect can result in an insured being ticketed for not carrying proper insurance on a vehicle even though coverage may be in force. This can be corrected by simply correcting the vehicle identification number and allowing the insured to provide proof of the change and continuous insurance coverage at the local courthouse or at the appointed court date.

Another minor complication that can easily result in the vehicle identification number being incorrect is a lien holder charging an insured additional monies along with the monthly installments paid on a loan to insure the vehicle solely for the lien holder’s financial protection. This is done to protect the investment of the lien holder, however it is at a much higher rate than the insured would have been insured for if they obtained insurance on their own.

There are times when the expense to the insured could be as much as three times the cost of what the insured could get coverage for elsewhere. This problem is compounded further by the insured receiving none of the benefits from the coverage that has been given to them that could easily be chosen had the insured gotten coverage on their own. Roadside assistance and new car replacement are just a couple of examples of beneficial coverages that would not be available to the insured if the lienholder were to insure the vehicle.

This problem can be corrected by simply correcting the vehicle identification number on the policy and providing proof of the proper number being listed on the policy to the lienholder by the insured or by your agency. More often than not, the additional funds that were charged to the insured for being improperly insured will be returned to the insured upon presenting the proof of vehicle identification number change to the lienholder with proof of no lapse in coverage.

Many things can go wrong when binding personal auto insurance.

It is important that an agent be vigilant even on the smallest detail when gathering information and most certainly verifying the information that has been entered. Even the simplest misstep in data entry could result in quite the inconvenience for the insured down the line. And this in turn results in the agency being required to compensate more with customer service work that costs your agency precious time that could be avoided.