How to Deal With Car Insurance Agents Effectively!
As investors, we are always on the lookout for the best bargains. Insurance agents are particularly adept at tapping into this psychology, which is why, there is always the threat of being duped. When it comes to car insurance in particular, we try to cut a good deal because if we do not make a claim, the value of the premium that has been paid is not realised.
While we might want to believe that we are getting the best value for our money, it’s important to be mindful of what we’re getting into, especially when it comes to dealing with car insurance agents. Here are a few aspects we need to bear in mind –
Insurance agents have to be certified
All insurance agents are licensed by the IRDA in line with the new Insurance Act, and they have to clear a certification exam before becoming agents. This is to prevent the number of frauds that take place and to make sure that agents are capable of giving customers sound advice when it comes to insurance.
Furthermore, insurance companies are also made to follow stringent procedures while recruiting and training their agents where they have to also pay heavy penalties even if something is misspelled in the form. Thus, while dealing with an agent, you must ask for their ID card. Better still, you should take a picture of the ID and cross-verify with the insurance company whether that agent is in fact, affiliated with them.
Agents will never ask for cash payments
The most important thing to note is that an agent with authentic credentials will never ask for cash payments. If you are writing a cheque or issuing a demand draft, you should ensure that you list out the name of the insurance company yourself. Also, before issuing a cheque, call the insurance company and confirm the correct name that needs to be issued on the cheque.
Agents will always provide you with the name of the insurance company to be written on the cheque, and never the private firm that they work for. Make sure you are regularly in touch with the insurance company and their customer care department through the toll-free numbers provided in your policy document, or on the company website.
Also, it is the duty of the agent to provide you a receipt once you make a payment for a premium – ensure that you always receive a receipt upon payment. Always make sure that your agent provides you a receipt once you pay a premium.
Benefits to agents
Agents work on a commission basis, which is why they will try their very best to upsell you on coverage and policy features that you do not necessarily require. Before meeting with an agent, you should conduct sufficient research on consumer forums to confirm whether you are taking the right policy at the right premium rate and with the right inclusions.
Also, since insurance agents are affiliated with specific insurance companies, you ought to contact an agent after researching the best policy available in the market for your requirement before approaching them.
The lower the premium offered, the higher the chances of receiving lesser cover – Usually, we tend to bargain with agents, to bring down the premium. What we don’t realise is that while an agent might begin with a quote that includes the cost of add-on covers, as the bargaining process begins, they might remove these costs and provide a base policy. Add-on covers can be important, which is why customers should investigate further and make sure that the provisions of the policy meet with their expectations.
Agents can also sometimes reduce the value of your car in order to bring your premium down. This in turn will lower your insured declared value (IDV). Thus, when the time comes for you to make a claim, you will receive a lower amount in accordance with your IDV.
This is also the case where the voluntary deductible is concerned. The voluntary deductible is the monetary loss borne by the policyholder and can be compulsory or voluntary. Agents might lower your car insurance premium by increasing the voluntary deductible wherein, you would be compelled to pay more money for the voluntary deductible when a loss occurs.
Agents might misinform you about the claim history process – If you would want to shift from one insurer to another and you are hoping to get a discount, an agent might convince you not to disclose to the new insurer, a claim made to your previous insurer. Your claim can be rejected when the time comes to make a claim with your new insurer as they might call your old insurer to verify claim history.
A standard cover can be pitched as a special offer –In order to earn higher commissions, agents might sell you a policy by bloating the price and then offering you a discount on the premium. Or they might offer you an add-on cover at the price first disclosed, as a value-add though the premium price was inflated to begin with. You should compare policies and identify their current market price and the price for add-ons before approaching an agent.
Non-disclosure of No-Claim Bonus (NCB) – Agents might not inform you that your car insurance plan is linked to the person who buys it and not the car. A no-claim bonus is a discount on the premium that is offered by insurance companies if the owner has not made a single claim during the term of the policy.
So when you are buying a new car, the accumulated bonus can be transferred. Thus, while selling your old car, you ought to retain the insurance in your name so as to make a huge savings on the insurance premium.
Since the role of the agent ends when you buy the insurance policy, in some cases, it is better to directly purchase the insurance online on the policy website so that you can steer clear of insurance frauds and ensure that you are getting your money’s worth.
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Note: This is your car’s recommended IDV as per IRDAI’s depreciation guidelines.asdfsad However, insurance companies allow you to modify this IDV within a certain range (this range varies from insurer to insurer). Higher the IDV, higher the premium you pay.
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