In this recent case study- our clients are a middle-aged married couple with a great credit score, owns a home, and two vehicles. They have one at-fault loss and one not at fault loss in the last 5 years. These clients have over $1,000,000 in total assets (savings, equity, earning potential)
We started by increasing their limits to protect against a catastrophic loss. The current policy shows 100/300 limits. Context matters when discussing coverage limits. A newlywed couple in their early 20’s with their first home, 100/300 maybe adequate considering the profile. This particular client has well over 1 million in assets. These assets will mean little if they find themselves at fault for a catastrophic loss. Like it or not, people who have accumulated assets are an easy target in court and a large loss may prevent our client from retiring.
When it came to Uninsured motorist coverage- we do not write policies that insure other people for more than we insure our clients. (To read more about Uninsured motorist) A client worth over 1 million should not UM coverage set to 50/100. In the event, another party is at fault for their medical expenses, and they do not have the assets to cover the bill, our policy will pick up the rest up to 250/500.
We both agreed to go with higher deductibles for auto coverage. At TWG we feel that insurance is for catastrophic losses. High deductibles will prevent clients from using their policies for small losses. More often than not, a small loss will cause increases in the premium charged over a 3-5 year period, often exceeding the payout after their initial $500 deductible.
The previous rental car coverage at 30/900 was simply not enough. Ten years ago, $30/day left many clients with out of pocket costs after coverage. While often not a deal-breaker, in our experience after clients pay their deductible, they do not expect to be nickeled and dimed by low limits with a rental car. Further, to increase the coverage 30/900 to 40/1500 is often only a few dollars a month.
As an independent agency with a diverse offering of carriers, allows us to pick carriers that have perks like free/low deductible glass coverage (if you would like more of an explanation about independent agencies see XXX). In this case, the Allstate policy will charge $250 to have the glass replaced. With other carriers like Safeco, this deductible is waived, and Travelers will replace the glass for only $50. When it comes to insurance, we want policies to say yes, when a client asks for help.
For the Homeowners policy, we saw a varying opinion on the rebuild cost of the home between Allstate and Travelers. While having high limits does not necessarily mean that will be the claim settlement will be higher, having low limits will. Our agency would rather be known for having too much coverage, than face our clients with not enough.
All clients with TWG have $5000 in the water back up. Standard, no quote goes out without this coverage. Water back up is a common loss that is often excluded when agents focus on price. I cannot count how many times I have walked into client’s home as an adjuster with no intention of making the payment but using that time to get proof for the denial should it go to court. Please note that $5000 in the water back up will only likely cover the removal of sewer water, but we feel some coverage by default is better than no coverage. Many of our clients may elect for more coverage depending on their risk tolerance. As much as we love insurance- not everyone wants to be insured against every little occurrence at the cost of price. Remember- Losses are rare, premiums are monthly.
After all, this discussion on increasing coverage Travelers felt they could offer this client more coverage at a lower premium.
We focus on building a profile that meets the client’s needs for this exact reason. Finding the right carrier who thinks our clients are rock stars. That is how we save the client’s money. Not by chopping up coverage and leaving clients with denial letters at their time of need.
Here is a prime example of why we build our own profiles and avoid comparing “apples to apples”. After we decided to partner with Travelers, this client admitted to never even meeting or speaking with his current agent and was no explainable reason for their prior coverages.
If you have recently received a bill from your insurance company, felt you are paying too much, or do not know what you are paying for, give us a shout at 678-921-3601 for a free insurance profile. Even if we cannot help you, we will give that profile, free of charge. We want everyone to be properly insured, even if it not through us!