The Advanced Guide to Choosing the Best Insurance Agent for You

With so many options when it comes to insurance agents, picking the right one can be challenging.

Not only do you need to evaluate whether they offer insurance at a price point you can afford, but you have to make sure their policies can sufficiently protect your assets and loved ones.

Choosing the wrong agent may result in insufficient coverage of the things that matter most.

That could mean losing thousands of dollars if something happens to your car, your home, or your other possessions.

Even worse, the wrong agent can steer you towards a questionable life insurance policy that could lead to your family facing financial difficulties if something happened to you.

That's a nightmare I personally wouldn't want to experience, or anyone to, for that matter.

That's one of the reasons I've made it my life's work to help people find great financial advice and provide some of the most useful financial tools available online.

And it never hurts to know your options—you might even be surprised by how much you could save.

That's where's free life insurance quote tool can really come in handy—it gives you personalized rates from the nation's best insurers.

2018 Average Monthly Life Insurance Cost for U.S. Non-Smokers

But buying your insurance through a great agent can be a more rewarding experience than going direct or doing it on your own.

Finding the right agent now means you have a trusted adviser on insurance matters for years to come.

That means you need to consider more than just how much an insurance policy will cost from a particular agent.

Knowing how to evaluate the coverage, benefits, and other factors will help you find the best agent for your needs.

If you've struggled in your search for an agent before, this guide will make sure you'll be able to select the right one for you.

Before You Search

Don't just jump right into hunting for an insurance agent.

Taking time to prepare before reaching out to talk to all the available agents in your area can make your search easier, faster, and hassle-free.

It's all about knowing what kind and how much insurance you're looking for, and understanding the difference between independent and captive agents.

Know your needs to pick the best agent

A good rule of thumb is that your insurance needs should dictate the agent you select, not the other way around.

Know what you need. That means it's highly important for you to have a solid grasp of what type and how much insurance you need.

Picking an agent without this knowledge could result in you paying for protection you don't need.

For instance, say you need insurance for a $2,000 car.

An insurance agent convinces you that you need more than just liability insurance, so you purchase collision insurance as well.

If this policy costs $200 a month, you will have paid $2,400 after a year.

That means you would have paid more for insurance than the value of your car.

Knowing what kind and how much auto, home, life, or another type of insurance you need will help you know whether an agent is recommending policies with your best interests in mind.

Think about what you will need in the future, too. Your insurance needs will change as you age.

When you're young and healthy, you may not need a lot of insurance, especially if you don't have a pre-existing condition.

That means you might be fine with an agent that doesn't offer disability insurance, low-deductible health plans that keep out-of-pocket costs down, or life insurance options.

However, this may change once you start a family.

When that happens, things like a life insurance policy that can provide for the long-term care of your loved ones start to gain a bit more importance.

Pick an agent that offers a wide variety of products, and you'll save yourself the hassle of having to switch down the road.

Choose the best agent for you by understanding their strengths and weaknesses

There are two main kinds of insurance agents, each with their own benefits and drawbacks.

Captive agents represent one company. Captive agents only sell insurance from one insurer.

That means they know these specific products really well.

They understand the ins and outs of all the discounts, limits, and exceptions that may affect your policy.

Better chance of bundles. You also get a better chance of saving money through bundling different kinds of insurance together with captive agents, since all your insurance will inherently be with one company.

For instance, bundling home and auto insurance through one of Farmer's captive agents will lower your premiums.

Offering Services Adds Points to Life Insurance Customer Loyalty

A few cons. The drawback with captive agents is that they only offer products from their company.

If that range of products isn't sufficiently wide, it can limit your captive agent's ability to keep up with future changes in your insurance needs.

Also, many captive agents are after sales quotas and receive incentives from their respective companies for pushing specific types of insurance.

This may result in an agent trying to convince you to purchase a type of insurance that you may not actually need.

More options with independent agents. Unlike captive agents, independent agents represent multiple insurance companies.

That means they can offer a wider variety of policies to find you the best deals on coverage.

They also aren't limited by one company's selection of policies as your needs change.

Adaptable insurance. For instance, say your independent agent found you a great deal on home and auto insurance from a company specializing in only those areas.

You get married a few years later and prepare to start a family.

Now, you need life insurance to protect your family's financial future.

Deciding on a policy can be difficult since different companies have different rules for things like pre-existing conditions.

Your independent insurance agent would be able to help you decide between whole or term life insurance and track down a great policy from a different company than your current insurer.

Some agents also offer financial planning services, which can benefit you beyond just deciding on which insurance options are best suited for your needs.

Not as knowledgeable. The downside of an independent agent is that they may not have a comprehensive understanding of every policy they offer.

That means they may not be as effective as captive agents at hunting down all the possible ways of saving on your premiums.

Commission-based. Also, insurance companies will pay independent agents more money for selling certain types of coverage.

For instance, an agent could receive a 10% commission from a company for selling home insurance and 15% for health insurance.

While this doesn't put them under as much pressure as a captive agent for selling these products, these incentives may still influence their decision on which products to recommend.

There are additional considerations for understanding how these commissions may influence an agent's behavior, which will be covered in a later section.

You may not need an agent. Some companies don't use agents at all, and instead, sell insurance directly to their customers.

Cutting out the middleman like this sometimes means they can offer lower prices than companies that use agents.

However, these lower prices mean you won't have the personalized, relationship-focused customer service that an agent can offer.

This trade-off can be the deciding factor when choosing between companies like State Farm and Progressive.

Think about whether you need an insurance agent at all before starting your search.

If you're okay with losing the customized service that agents offer in exchange for a few more dollars left in your wallet, you may be better off searching for insurance on your own.

Starting Your Search

After understanding your insurance needs and the different types of agents, your next step is to whittle down the list of available insurance agents in your area.

Keep several things in mind when putting together your list of agents to contact.

You'll want to research the different agents and companies they represent to see which one is the best fit.

Preferred Life Insurance Brands by Age Group in 2017

Buy insurance from a registered agent by checking their credentials

All insurers are required to be licensed by the state to act as an agent.

So the first step in selecting an agent is checking whether their license is up-to-date.

Find that information by selecting your state on the National Association of Insurance Commissioners website and searching the database for a particular agent.

Other credentials. Being licensed is the bare minimum for insurance agent accreditation.

Insurance agents that have earned credentials on top of their license often provide excellent service.

That's because these agents are bound by the codes of conduct for the organizations issuing these designations.

If you need life insurance, look for an agent who has earned a Chartered Life Underwriter or Chartered Financial Consultant designation from The American College for Financial Services.

They can effectively help you with financial planning services and ensure you're able to continue to take care and provide for your family should anything untoward happened to you.

Agents with a Chartered Property Casualty Underwriter designation from the American Institute for Chartered Property Casualty Underwriters have special training in providing coverage for your home, car, or other possessions.

Seeing such a badge should give you a bit more peace of mind when you're taking their advice.

Reviews and referrals help identify agents with solid track records

You want an agent with a proven history of helping other people find affordable, great coverage.

Check Yelp, Facebook, and other review sites to see what other people are saying about an agent.

Get personal referrals. Your friends and family may have recommendations for a particular insurance agent.

Check with them to see if they have any suggestions for particular agents to look into.

Get the insurance you need by checking the companies they represent

Whether captive or independent, each insurance agent will represent different companies.

Research the companies. You want to make sure they offer coverage that meets your needs.

For instance, you probably wouldn't want an insurance agent specializing in life insurance companies like Pacific Life if you're specifically looking to get car insurance.

Contacting the agent

Once you've narrowed down your list of potential insurance agents, it's time to get in touch with each potential prospect.

This is where you can really determine whether an agent deserves your hard-earned money.

Asking questions about the following topics will make sure you'll find the perfect one.

Ensure a stress-free future by making sure you get along well

You'll potentially be calling your agent during the most stressful times of your life, like car wrecks, house fires, or other incidents.

Top 10 Life Insurer's Overall Service Experiences

Check their personality. You should make sure that they seem dependable, accessible, and capable.

It can be easier to get a read on these traits in-person rather than over the phone.

If possible, set up an appointment to drop by an agent's office or schedule grabbing a coffee with them.

File future claims more easily by knowing an agent's role

Depending on which company they represent, agents may be more or less involved whenever you need to file a claim.

Different companies, different ways. Most agents play a sales and consulting style role in helping you find the insurance you need.

In these cases, you only speak with an agent about renewing, changing, or canceling whatever policies you may have.

Others have a more involved role, assisting you with the filing of claims whenever necessary.

If your agent also acts as the point person for any claims you may have to file, making sure your personalities jibe with one another is especially important.

Ask for the time. Additionally, consider what hours they are available for contact.

You might have an important claim delayed if they're unavailable to help you file in the evening or on weekends.

Ask them how long it usually takes them to resolve different types of claims on average.

This can help you determine whether you'll get claims resolved in an acceptable timeframe.

Get the best deal by asking about commissions

Many people assume that insurance agents always try to sell unnecessary kinds of insurance to get the biggest commission possible.

Part of this is true—of course they want a large commission.

However, smart insurance agents want you to come back and renew your policies year after year.

They know that the best way of doing that is to give you great service and helping you find a policy that meets your needs.

Understand how they get paid. You should still ask an agent about their commission structure.

This can be a bit awkward—no one likes talking about money, after all—but your agent should be able to give you a clear answer.

You want to specifically check whether there are certain products they get more money for selling.

Also, check into whether they get an incentive for booking new business instead of repeat customers.

That way, you can tell whether they're looking to make a fast buck off a quick sale or keep you coming back down the road.

Know what you need to get services beyond insurance

Take into account if you need help with wealth planning, saving for retirement, or investing, on top of the insurance you want to get.

If so, you may be able to find an agent who's a one-stop-shop for these services.

Get more than insurance. Some agents for companies can advise you on the best way to manage your finances.

If that's something you need, you'll want to check for additional credentials.

See whether they hold a Certified Financial Planner designation from the CFP Board.

U.S. Certified Financial Planner Designations by Age in 2018

Find a reliable agent by asking about their tenure. Check how long a particular agent has been with a company.

There's nothing wrong with choosing a newcomer at a particular company if they seem qualified, but make sure you choose someone who seems like they'll be around for a while.

In it for the long haul. Choosing an agent who's been with a company for a few years means they've proven they have staying power.

While this won't guarantee the agent will remain at a particular company, it's generally a good sign of their commitment and stability.

Have a contingency plan by asking what happens if they quit

More insurance agents are leaving the business than ever before.

In fact, over 20% of agents will reach retirement age in the next 10 years, according to a report from McKinsey & Company.

Ask what's next. Find out what happens if your insurance agent quits or retires from their current position.

See who gets to handle your account and whether you'll have an option to cancel if the new arrangement is unacceptable.

That way, you can avoid getting a nasty surprise sprung on you in the future.

Make sure you can keep your insurance by checking where it's available

Not every insurer offers coverage in every area.

If you have a move coming up or frequently change locations, you'll want to make sure you can keep your agent.

Changing states. Most agents are only registered to provide insurance in one state, so crossing state lines usually will mean going on the hunt for a new agent.

In these cases, check whether your insurer offers insurance in multiple states.

That way you can at least keep the same company, even if you have to change your agent.

Find the geographic limits. Many captive insurance agents are often limited by their company from selling insurance outside of a designated territory.

Ask your agent whether you can stay with them if you make an in-state move, or if you would have to find another agent responsible for covering that area when it's time to renew your policy.

Have a solid exit strategy by asking what happens if you leave

You probably won't be with one insurance company for the rest of your life.

That's why it's important to have a clear understanding of what happens if you need to cancel your policy.

Check into penalties. Some insurance plans charge you a penalty for canceling your coverage outside a specific window.

Ask your agent when you can end any policy you may sign up for, as well as what fees may be charged for an early cancellation.

If you plan on paying for the entire term of the policy upfront, check into how much of that money you would be able to get back in case you decide to terminate your policy prematurely.

While most policies will refund you for the months you didn't use, there may be a fee for doing so.

Find a great insurance agent by knowing what's important

Searching for an insurance agent is hard.

You have to select one from hundreds of competitors representing dozens of companies.

However, doing your research and knowing the important questions to ask can go a long way towards helping you find the right agent.

All it takes to get started is knowing your insurance needs, understanding how to identify which insurance agents should be on your list to contact, and what matters you need to discuss when you get in touch with an agent.

Keeping all these tips in mind will help you find an insurance agent that can provide you coverage that protects you, your loved ones, and your belongings at an affordable price.

Have you tried searching for the ideal insurance agent before?

What tips and tricks worked for you and what didn't?

Any tips (or nightmares) to share with the rest of us?

Let us know in the comments below!