Last week someone told me, “Sales is sales. If I wanted to do insurance, I would kill it.” At first I was very offended at this simplistic comment. After I calmed down at what I perceived to be an attack at my profession, I realized that this was just another example of someone activating their mouth before their brain was engaged.
All Americans have heard how greedy and pushy insurance agents can be. I will agree that there are some greedy and pushy insurance agents who promote that stereotype. However, I will also state that those greedy and pushy insurance agents are in the minority. Most insurance agents are true professionals.
There are few barriers to getting a state license to sell insurance. If you are over 18, have not committed a crime and are able to pass your state’s licensing test, you too can be legal to sell insurance to you unsuspecting friends and neighbors. While you are studying for your license exam you will learn enough about insurance and contract law to fool most people into thinking that you understand how insurance works.
While watching the Olympics last week, I heard an announcer say, “It takes 10,000 hours for an individual to become an expert.” That would mean that in order for an insurance agent to have the same level of expertise as an Olympic athlete, he will need to work with insurance for 40 hours a week for 5 years.
Approximately 96% of people who start selling life and health insurance “find happiness elsewhere” within 4 years. They guilt their friends and family into buying insurance from them with no regard to how the insurance plan works. They get paid their commissions but when their friends or family need the insurance, they are no longer in the business or able to help them if they have problems.
If you are going to use an insurance agent with less than 5 years experience, make certain that you also get to know his mentor. He should have an experience insurance professional to review his work and make certain that he is operating for your benefit and not his.
If he leaves the industry, you will still need to have access to an insurance professional that you trust. If you do not, you will be added to an “orphan” book of business. You will start getting calls from another novice insurance agent to “get to know you.” That is code for “sell you something.”
The politicians implied, during the Health Care Reform debates of 2009-2010 that the internet has rendered insurance agents obsolete. They can be easily replaced with the internet portals they call Exchanges.
If your goal is simply to buy a government approved “Essential Benefit” plan that is correct. If you are comfortable using the internet, you do not need the services of an insurance agent.
In spite of all the political rhetoric in the last 4 years, Obamacare is not the cure-all that we were led to believe. It authorizes 4 different levels of insurance protection. All of the proposed “Essential Benefits” plans have cost-sharing. None of them will pay all your medical bills. If you do not want to pay anything to your doctor or hospital, you will still need to get a supplement.
The “Essential Benefit” plans address the “Accounts Receivable” problems of doctors and hospitals. (My wife is an accountant. “Accounts Receivable” refers to the charges that a doctor has billed but not yet been paid.) They do not prevent Americans being forced to file bankruptcy even though they have health insurance.
As long as there is a cost-sharing element (deductible, co-pay, co-insurance) many Americans will still have to use the money they were using to pay their mortgages, car payments and other bills to pay doctors and hospitals. They will need a form of health insurance called Disability Income or Critical Illness insurance to give them enough money to allow them to maintain their standard of living until they recover.
A serious illness or accident can limit your ability to function. If that were to happen to you, your health insurance will not help you to hire someone to help you. Title VIII of the PPACA was supposed to plug that hole but it was suspended by the Executive Branch of government in December of 2011
The insurance professional will not stop with a single sale. Since no insurance policies are comprehensive, he will also help you find the areas in which you are left exposed. He will be able to suggest optional supplements to you Major Medical insurance to help you build the best health insurance portfolio for your needs.
The insurance professional understands that he will sell more insurance and have fewer customer service problems if he uses the information he learns to meet your insurance needs rather than his own commission needs.