National Underwriter - November 7, 2011

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IN NU’S OCT. 17 editorial, I reported on my experience shopping for and choosing a renter’s insurance policy— opting, in the end, to go with USAA after a phone call with one of its representatives (a State Farm agent just up the street from me was also in the running).

The column sparked dozens of reader responses—most from independent agents. Some gently chided me for not getting the expert advice an independent could have offered. Others were absolutely outraged I hadn’t considered independents, and called for my head/threatened bodily harm (luckily, I do have good life and health benefits).

Here are just a few samples of the sentiments expressed—followed by what I think is one lesson that can be drawn from this.

“I was very disappointed you did not approach an independent agent…Should you have a claim that falls in a gray area, who is going to fight for you, do research for you and challenge the company on decisions you do not agree with? I spend 20 to 30 percent of my time helping my clients with claim issues…If you had a great friend who knew about insurance, wouldn’t you be talking to him? Well, guess what? That’s what the independent agent represents—he works for you!”—Jeffrey T. Betts, President, Landmark Insurance Agency, Cincinnati

“USAA is a 1-800-who-cares company. In the future, you will never talk with any person who knows you. State Farm would at least know you as a name, not a number. But…you get what State Farm offers, with no choices. If you had called an independent insurance agent, they would have probably given you choices. For example, did USAA or State Farm offer you $300,000 or $500,000 of personal-liability insurance coverage for just a few extra dollars?” —State of Washington-based independent Agent (name withheld, by request)

“As a professional independent agent,
we only offer liability limits of $500,000
on homeowners’ policies due to the low ad-
ditional cost. We always advise our prospects
to add $10,000 more to personal property
than what they think is needed because, once
again, the additional cost is small. My guess
is that if you make these two changes on your
policy [which had $25,000 of property], the
increase in premium will be in the $50 to
$75 range…One of the major principles of
risk management: “Do not risk a lot for a
little.”—Steven R. Jacobs, Producer Partner,
Lawley Insurance, Buffalo, N. Y.