Buying and Selling Insurance
Created by FindLaw's team of legal writers and editors | Last reviewed June 12, 2017
There's nothing quite like signing the closing documents, shaking hands with your agent, and being handed the keys to your very first home. Since it will probably be the biggest purchase you ever make in your life, you'll want to protect your investment with a homeowners insurance policy. But how do you choose? Whether you're looking to buy insurance or considering becoming an insurance agent, you'll want to get a handle on how insurance is packaged, what it covers, how laws come into play, and more. FindLaw's Buying and Selling Insurance section will help you better understand what goes into an insurance premium, the meaning of "loss run reports," insurance regulations and state laws, how to report an insurance company, and more. You'll even find an overview on how to become a licensed insurance agent, with a listing of state-by-state license requirements.
The Basics of Buying Insurance
Whether you're insuring your home, car, health, life -- or anything else of value -- you'll want to start out by deciding how much coverage you need. If you're shopping for health insurance, you'll want to take stock of your health needs. How much do you spend on prescription medications each month? Do you make regular visits to the doctor? Do you have a history of health problems? And, perhaps more to the point, what kind of coverage would prevent you from suffering a major financial setback if you were to become seriously ill or injured?
The same can be said about any other kind of insurance. If you're driving an old, beat-up car and just want it to last for a couple more years, you'll probably just carry liability insurance (which is required in most states) and forgo collission coverage. When considering life insurance, you're mainly concerned about dependants, significant others, and people who would need financial support in your absence.
Once you know what you need, you can begin to solicit quotes from competing insurers. Many insurers, depending on the level of information to make this determination, can give you a quote online in a matter of minutes. This is particularly true with auto insurers. It takes some time to parse out the details, but make sure you're compariong "apples to apples" before making your decision. For example, that $100/month health insurance policy may seem affordable, but the $10,000 deductible could make it impractical to actually use.
The Basics of Selling Insurance
If you want to become an insurance salesperson, you'll need to understand the laws and regulations applicable to your state. Generally, there are no formal educational requirements for selling insurance, but you will need to obtain your state license. There are several testing companies that are compliant with their respective state's requirements. Also, you may be subject to a criminal background check. In addition to fees paid for educational or testing services, you'll also pay a licensing fee (often annually).
By obtaining supplementary insurance certifications, you'll be able to expand your offerings. For instance, being certified as a Chartered Financial Consultant (ChFC) will permit to sell life insurance policies that also serve as investment vehicles. You also may have more success in your practice by offering complementary products to your clients.
But regardless of your training, certification, or level of expertise, perhaps the most important aspect of selling insurance is to learn about your clients' needs and connect with them on a more personal level. By definition, something that is insured is very important to the client; so you'll want to be skilled at walking them through those critical decisions.
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