There are an endless amount of stories out there that tell a tale of where insurance went wrong. Whether it was the broker in charge of the file, the adjuster that just didn’t understand, or the premium that increased at renewal, these stories exist. The sad part is that all of these problems are real and all of them have consequences, which typically reveal themselves as a loss of relationship somewhere. The tough thing about insurance is that so much of the nature of the business is wrapped up in trust, understanding, and communication. There’s an old scripture somewhere that talks about peace, hope and love, and the greatest virtue being love. Well, in the insurance world, the virtues we have are trust, understanding, and communication- with the greatest of these being communication.
Pertinent side track discussion: relationships are so tricky these days! With the ever expanding dynamics of how relationships are conducted, lots of information can be misinterpreted, misunderstood, and much of how one is supposed to act or behave within the confines of a relationship can become blurred. With communication being the foundation of any relationship, it can be hard to do so when there are so many ways to talk- text messaging, instant messaging, Facebook tagging, phone calls, in person discussions, and the list goes on. On top of communication, there can be so many areas where expectations can be missed, dynamics can change, and pressure can be felt. These are all real aspects that need to be addressed and not run away from, but how does one address these things head on so that both parties can understand one another?
It comes down to good communication.
Now, before you start thinking that I am attempting to be the next relationship counselor, or step into the shoes of Dr. Phil, I will explain the point of all this relationship talk so that I connect the dots. However, before I do, I think it is important to take one step further back and answer the question “why is relationship an integral part of the insurance industry?” because without first answering this, the rest might seem a little far fetched.
Insurance is an industry that focuses on transferring risk from a property owner so that in the event of a loss, the owner doesn’t need to bear the full extent of the loss. Essentially, the insurance industry sells contracts full of promises to take care of you in your time of need. The contracts outline the promises which include conditions that will be upheld, and it also outlines the extent of the promises and just how far those promises extend. These promises are called coverages and exclusions, and all of these are wrapped up in conditions. Now, if one is going to surrender their hard-earned money to buy promises of conditions and exclusions, you’ll want to know that the promises are good, trustworthy and predictable. This is where the relationship piece comes into the equation.
Here is a question to ponder: what good is a promise if there is no relationship attached? If there is no foundation of trust and understanding of the nature of the relationship then the promises become pretty meaningless. Further, if one doesn’t fully understand the nature of the relationship and the way it changes and flexes, there is a huge possibility that you are going to be left feeling upset, disappointed and confused.
Insurance companies sell promises to protect your livelihood and respond in the event of a disaster. The insurance broker that sells you the product is an extension of that company, and they are typically the one that outlines the nature of the relationship you have on paper, and they are the ones that help communicate how the relationship will look and feel. If this communication breaks down, or if there is an aspect of that relationship that is presented in a way that is misleading, there will be with out a doubt trouble on the horizon. When a disaster strikes, you will be looking to your insurance company and broker to uphold their end of the relationship and respond in a manner that you have been told- after all, you kept up your end of the relationship by paying your premiums, right? In essence, if the way the company responds is in line with your understanding, the relationship will remain strong. However, if the way the insurance company responds is quite different than your understanding, there could be a severe breakdown in trust which will lead to the end of the relationship itself.
All of the stories about “insurance gone bad” stem from the same central point- communication. If you have questions about your insurance policy and how it will respond, its best to have the conversation before something happens so that you have a clear understanding of what kind of relationship you actually have with your broker and insurance carrier, and what you can expect when that relationship is tested.
Relationships aren’t easy, and there are miscommunications and missed expectations all the time. Make sure that you understand where you are at with your insurance product, and that you are well informed on what will happen when those promises are called into action. Not knowing and not being in touch will only lead to disappointment, broken trust, and frustration. Talk to your broker today and make sure you understand your insurance relationship!