7 questions you should ask your insurance agent

What are the legal responsibilities of an insurance agent or broker? How do I know what questions to ask? And what do I do if I need help figuring it out?

Note: This material is intended primarily for individuals and middle market organizations to aid them in evaluating risk and establishing strategies for dealing with them. This includes both insurance and non-insurance options. This is not to be confused with qualified legal advice. Your local bar association or Google can help you find an insurance attorney if you need one.

1. What are the legal responsibilities of an insurance agent or broker?

The answer varies by jurisdiction, but in the broadest general description is to do what the customer asks them to do and resist the temptation to lie, cheat or steal. This is generally referred to as an ordinary business relationship.

2. What if I’d like more help dealing with these important things that I know so little about?

To elevate your relationship with your agent to a fiduciary relationship, one of you is going to have to communicate a desire to do so, and both of you will need to acknowledge the nature of the relationship.

3. How do I do that?

It’s all about questions and answers. The most important question to ask yourself is “how did is choose my agent?” Here are some wrong answers:

I went to high school with him.
She is my sister-in-law.
They have low rates.
The quote process was quick and easy, and he didn’t bother me with a lot of questions.
Their commercials are funny.

4. What is the right answer?

The agent showed general interest in helping me understand exposures and coverages. She asked questions similar to the way a doctor diagnosis an ailment, minus the invasive procedures.

5. What are a few examples of questions I should expect for an individual or family?

Do you conduct a business on the premises?
Do you have any special property like guns, jewelry, antiques, art?
Do you have children way at school?
When will you take occupancy of your new home?
Do you travel outside the country?
Do you have domestic workers of any kind?

6. What are a few examples of questions I should expect for a business?

How do you receive or ship goods?
Do you do business overseas?
Do you reimburse employees for foreign travel?
How is the Internet used in your business?
Are there seasonal fluctuations in your inventory?

7. This all sounds like communications. Should I document these, or is it okay just to do it verbally?

I’m not even going to answer that.