Risk

Most insurance risk and subsequent financial loss occurs from lack of adequacy, uniformity and consistency of coverage.

Some important facts: 9 out of 10 consumers are at risk from:

• Not having Adequate insurance limits of protection
• Not having Uniform limits of protection within an insurance product
• Not having Consistent limits of protection within a group of products

How can we minimize or even eliminate this risk? Let’s first look at three approaches of how insurance is sold and how people make decisions about insurance.

Transactional Approach

The focus of many consumers and certain well-known national insurance providers is on selling particular products, the low initial price and the speed of getting quotes. We are bombarded with advertisements and information about insurance choices.

The messages focus on how quickly you can get a price on a quote and what percentage can be saved. Auto insurers promise that they can keep you “legal” with state-required minimum coverage.

We discourage this approach of quick fixes and underinformed self-diagnosis without proper industry knowledge. A lower premium today can potentially leave you more susceptible to risk and higher costs in the long term.

The Value-Added Approach

Value-added products and services from insurance agents are often policy enhancements built within insurance contracts at the point of purchase about which the customer may have limited information or understanding.

In many cases, these products and services may incur a higher cost over the long run, relative to their perceived value. Examples would be diminishing deductibles, safe driver discounts, roadside assistance, accident forgiveness and claim satisfaction guarantees.

The Consultative Approach

The consultative process is what the Holistic Insurance Level Program recommends. It requires an analysis of current needs and educates the consumer about the policies they purchase to ensure they are adequately, uniformly and consistently covered in all their policies, whether it be for life, home or vehicles.