Fighting insurance myths, mistakes & misconceptions

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Insurance myths and misconceptions – you’ve no doubt heard them all and corrected them a million times. But even if you could “write the book,” it can always be helpful to hear how other professionals might respond to the myths. It can also be beneficial to share that wisdom with younger, less-experienced agents and...

Insurance myths and misconceptions – you’ve no doubt heard them all and corrected them a million times. But even if you could “write the book,” it can always be helpful to hear how other professionals might respond to the myths. It can also be beneficial to share that wisdom with younger, less-experienced agents and producers. We’ve gathered a collection of some that we’ve found helpful.

 

Insurance Lies Clients Believe – And Pass on to Others

Christopher J. Boggs, vice president for education for Insurance Journal’s Academy of Insurance lists the following lies or myths – click through to learn his replies.

  • If I don’t have anything, they (the plaintiff, lawyers and court) can’t get anything; you can’t get blood out of a turnip
  • There is no need to purchase liability limits higher than my net worth
  • That’s why I buy insurance
  • Corporate status will protect me from liability; I’ll just declare bankruptcy and shut down
  • Public adjusters are bad (or good)
  • Insurance is all the same
  • It’s better to pay small liability claims out-of-pocket rather than report them to the insurance carrier
  • Statute does not require me to have workers’ compensation, thus you (a higher tier contractor) can’t require it either
  • I pay him with a 1099. He’s an independent contractor, not an employee

I don’t need an insurance agent – I can get better prices on my own.

At our Consumer Insurance Blog we offer many reasons why it makes sense to work with your local independent insurance agent – the post offers links to various sources touting the many benefits of working with an agent.

Insurance Information Institute offers replies to Eight Auto Insurance Myths

  • Color determines the price of auto insurance
  • It costs more to insure your car when you get older
  • Your credit has no effect on your insurance rate
  • Your insurance will cover you if your car is stolen, vandalized or damaged by falling tree limbs, hail, flood or fire
  • You only need the minimum amount of auto liability insurance required by law
  • If other people drive your car, their auto insurance will cover them in the event of an accident
  • Soldiers pay more for insurance than civilians
  • Personal auto insurance covers both personal and business use of your car

10 [more] car insurance myths

  • The color of my car matters
  • My old car won’t be a target for theft
  • I’m covered if my car is stolen, vandalized or damaged by hail, wind, fire or flood
  • Credit scores don’t affect insurance rates
  • My insurance company can cancel my policy at any time
  • My friend borrowed my car, so he’s responsible if there’s an accident
  • Personal property inside my car is covered
  • I’m automatically covered for a rental car
  • Drivers of sports cars pay more insurance because of more tickets
  • Having no-fault insurance means it’s not my fault.

Five Insurance Mistakes to Avoid –And Still Save Money

  • Insuring a home for its real estate value rather than for the cost of rebuilding
  • Selecting an insurance company by price alone
  • Dropping flood insurance
  • Only purchasing the legally required amount of liability for your car
  • Neglecting to buy renters insurance
  • 5 home insurance myths you may have fallen for
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About Renaissance Alliance

Renaissance Alliance is the premier alliance for independent property casualty agencies. Founded by agents for agents in 1999, we are a pioneer in agency groupings, offering far more than expanded markets and profit share. Distinct from agency aggregators, we provide state of the art technology solutions, a full-time staff of more than 90 industry experts and a proprietary agency growth acceleration process that delivers superlative results.

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