I was scoping the web today and came across an article that merely said, “Insurance is a Scam.” Of course, my first reaction (the insurance agent in me) was totally infuriated that anyone would ever say such a thing- nevermind title an article, “Insurance is a Scam.” I figured this person was just asking for my reaction.
Anyway, I had to see what on Earth they were thinking. It turns out saying, “Insurance is a Scam” was just the right way to get me interested in clicking to read more. The they in this scenario is actually another insurance agent named Ryan Hanley out of Albany, NY.
Hanley covers a topic many insurance agents deal with: the moment a client comes to you and says, “Insurance is a Scam.” You, as a client, must have at least found yourself thinking that at some point in your life. Or if you haven’t yet, you may have just thought it was a waste of money. That’s a little justified. Who wants to pay for something they very rarely, if ever, use?
So at this point, I’m with you. But then, Hanley introduces what makes it all worth it. See the following pull-quote from his article:
I have a client who spun me a similar tale during the process of reviewing his policies. He was a stand-up guy who seemed to always do the right thing and was very proud of his family’s insurance history. He also always bought the proper coverage, 100% replacement cost on his home, maxed out his at-fault liability on every vehicle, etc. He protected his family. He was also very meticulous with his house. When I went by to take pictures the place was immaculate. He did everything himself or was involved first hand and felt very good about the condition of the house.
So every time I would meet with him about his insurance he gave me the Insurance is Scam routine. Because he had been paying $500 a year for the last 10 years for his Homeowners insurance and had never even come close to a claim. That’s $5,000 with what was in his mind Zero return… That does sound like a scam.
However, about a year ago the plot would thicken. My client and his buddy were up on the roof of my client’s house fixing some shingles that were damaged in a really bad Ice Storm that rolled through Albany, NY in the middle of July. Hail the size of Golf Balls, no joke.
Well, my client climbed off the roof to grab a new batch of shingles, in the moment of down time his buddy lit up a cigarette. Just as the new batch of shingles hit the top of roof the cigarette was finished. The cigarette was flicked off the roof and my client and his buddy went on to finish the roof repairs.
The cigarette did not make it off the roof. It got caught on the edge of the roof between the gutter and sat there smoldering until some wind and the heat started the house on fire (Everyone got out safe, Thank goodness!). The total loss figure between the fire and water damage from the Fire Department was ~$50,000 and because my client had secured proper and adequate insurance coverage he was reimbursed his full need.
So here’s how the story ends. Hanley’s client may have been paying $500 a year for insurance, for 10 years, without tapping into it – $5000 in all. It does sound scam-ish there.
However, after a $5000 pay in, the client was completely covered for the $50,000.
Now. Doesn’t it all seem a lot more worth it? (Source).
If you’d like a quote or a complete review of your current homeowner’s policy to make sure you have all the discounts/coverages you need, feel free to give us a call! 1-877-NBA-1980.