by TLE » Tue Jan 20, 2009 04:48 am
I was wondering if all these company's I see on TV that sell insurance on the internet and do not use an agent and they give a discount if you buy on line,does this hurt sales for some agents, and is it possible this could eliminate the agents job.
Posted: Thu Jan 29, 2009 09:38 pm Post Subject:
TLE wrote:
If they don't use the agent can they give a discount because they save money not paying the agent so they can lower the agents fee.
This is an insurance misconception by the general public.
It is a third degree felony is most states to solicit the procurement of insurance by anyone who is not a licensed agent.
AND my next comment is going to sound like an oxymoron.
ONLY a licensed insurance agent can sell insurance.
See Florida Statute 626.7845
626.7845 Prohibition against unlicensed transaction of life insurance.
(2) Except as provided in s. 626.112(6), with respect to any line of authority specified in s. 626.015(10), no individual shall, unless licensed as a life agent:
(a) Solicit insurance or annuities or procure applications;
beatuplunchbox wrote:
The really crazy thing is that these online companies can not charge any less than an agent. Rates are determined by state DOIs for this reason. I compete directly against these call centers and the quotes they give to prospects are identical dollar for dollar for the same policy from the same company.
The saving money or online discount is just an advertising angle.
That's right! EXACTLY CORRECT.
There's is no such thing as saving money because you bought over the phone or online. The "sales" and "marketing" perception they are wanting you to infer is EXACTLY what you wrote above TLE. "If they don't use the agent can they give a discount because they save money not paying the agent..."
While that's the intent of the advertized perception; it is not reality.
I'll quote myself from above:
TLE it IS insurance agents and agencies that own those online sites.
Posted: Fri Jan 30, 2009 09:02 am Post Subject:
Gary, I think what has confused TLE (and I'm sure that its also confusing to many others) is the difference in price for the same coverage while purchasing online and from the agent.
What do you think is the reason behind this price difference?
Posted: Fri Jan 30, 2009 11:47 am Post Subject:
Gary, I think what has confused TLE (and I'm sure that its also confusing to many others) is the difference in price for the same coverage while purchasing online and from the agent.
What do you think is the reason behind this price difference?
anonymous 12, your perception is the reason behind this mythical price difference.
If Matrix Direct quotes you a price for your life insurance with West Coast Life and then you come to my office for a quote for life insurance with West Coast Life for the exact same coverage the premium will be exactly the same.
The exact same commission will be paid on that policy from the insurance company.
Matrix Direct just happens to be an online agency appointed with West Coast Life to sell their products, whereas I operate an agency within a brick and mortar building.
When the TV ad says, "save money buy online" that is a generic advertising phrase. They probably said the words FREE and NEW also! They NEVER claimed you'll pay less in premuim buying online than through an agent within a brick and mortar building for the exact same coverage with the exact same company.
There isn't any difference in price.
There is only a difference in perception.
Now I don't expect anyone to actually read a typical online disclosure statement but I've provided one below from an online agency.
All insurance quotes and products offered through QuickQuote Financial, licensed agency in FL L006551. Tim Bain, licensed agent in FL D068808.
Premium rates quoted are current as of 1/30/2009, as provided by QuickQuote Financial, Inc.'s partner insurance companies. The premium rates shown are for quoting purposes only and are not an offer of coverage. Final premium rates will be determined by the insurance company and are based on individual circumstances. As a result of underwriting, final premium rates may differ from quoted premium rates. Although QuickQuote strives for 100% quoting accuracy, occasional quoting errors may occur.
QuickQuote Financial, Inc. is a licensed independent broker operating in all 50 states and the District of Columbia. We represent our customers and are contracted to market the insurance products of several different insurance companies. QuickQuote Financial, Inc. does not contract with outside agents or brokers. Your insurance application process will be handled by employees of QuickQuote Financial, Inc..
We charge no fees to our customers for our services. We are compensated directly by the insurance companies we contract with in the form of policy commissions. When you purchase a policy through QuickQuote Financial, Inc., the insurance company pays us a commission, depending on the contractual agreement in place. QuickQuote Financial, Inc. may also receive periodic bonus payments from insurance companies based on specified volume levels.
QuickQuote Financial, Inc. is completely impartial when it comes to helping customers select an insurance company. We do not direct customers to specific companies for purposes of increased compensation. Customers are able to select the company of their choice from our Web site marketplace. As a customer, if you require assistance with your specific company selection, our team of Licensed Insurance Professionals will help you find the company and product that best meets your individual needs.
Posted: Fri Jan 30, 2009 05:24 pm Post Subject:
Does that also apply to car insurance. when companies like progressive sells without an agent and they sell direct.
Posted: Sat Jan 31, 2009 12:17 pm Post Subject:
Does that also apply to car insurance. when companies like progressive sells without an agent and they sell direct.
Hmmmmmmm, TLE that's not what's stated on Progressive's own web site.
Can you show me where on Progressive's site they say it's absolutely less money buying direct than through a Progressive agent? They make no such claim, but that is the perception they want you to "think" in your brain.
Their DISCLAIMER at the bottom of their online quote page says:
Auto insurance products and prices are different when purchased directly from Progressive or through independent agents/brokers. Because each group makes decisions about their businesses that result in different rates, you won't know which group provides the lowest rate for you until you obtain a quote from our agency and our direct businesses.
I'll say it again, those TV commercials promoting that you buy online NEVER say you'll pay less money than going through an agent.
See THIS LINKY titled, Why Rates May Vary?
Because each group makes different decisions about their businesses that result in different rates, you won't know which company provides the lowest rate for you until you obtain a quote from our Agency Business and from our Direct Business. An agent/broker may provide the lowest price for some customers, while the direct rate may be lower for others.
A person's "perception" is their reality regardless of facts to the contrary.
Posted: Sun Feb 01, 2009 12:50 pm Post Subject:
TLE it IS insurance agents and agencies that own those online sites.
Not so in the P&C world Gary...If a customer buys on line (non-captive agent company, I'm not sure about captive), thru the main site (as you and TLE posted re: progressive as an example)...there is NO agent or agency affiliated with this site or purchase....RE: difference in price buying on line or thru an agent...the premium may not be less (and because of that) the carrier is making a lot more money on that sale than thru an agent, thus the push for on line purchases!
I don't know (but suspect) that rates being less when buying direct rather than thru an agent are state and company specific...
re: the mo dept of ins..
Does Missouri control auto and homeowner premium rates?
No. Missouri allows companies to set their premiums.
I'll do a little more research on this and see if I can find any addl. info re: MO anyway...
Posted: Sun Feb 01, 2009 01:57 pm Post Subject:
Ok Gary sounds like atleast per progressive's site the info that has been posted here is not correct..
Question
Are Progressive's online rates the same as rates from an agent?
Answer
No. Buying direct or through an agent could result in different prices for Progressive policies because those areas of our business make independent decisions about the expenses they incur and the prices of their products.
If you buy through an agent/broker, your rate includes the commission paid to the agent/broker for selling the policy. If you buy directly from Progressive, the rate reflects the cost of building, staffing and maintaining the sales centers and marketing costs of that aspect of our business.
Regardless of how your purchase your Progressive policy, you'll always receive the benefits and services Progressive offers to all its customers, including unparalleled 24/7 customer, claims and online service.
http://www.progressive.com/shop/rates-and-payments-FAQ.aspx
Posted: Sun Feb 01, 2009 09:55 pm Post Subject:
Ok Gary sounds like atleast per progressive's site the info that has been posted here is not correct..
Really?
Lori, how 'bout just for fun you click on the linky I provided and tell me who's providing that information?
Progressive makes no claim whatsoever that buying online is less expensive than through a Progressive agent.
IN FACT THEY STATE:
Because each group makes different decisions about their businesses that result in different rates, you won't know which company provides the lowest rate for you until you obtain a quote from our Agency Business and from our Direct Business. An agent/broker may provide the lowest price for some customers, while the direct rate may be lower for others.
What's quoted above is THEIR WORDS.
Not mine.
Posted: Mon Feb 02, 2009 11:57 am Post Subject:
Well Gary what I quoted was their words as well! And where did I say it was cheaper? It says right there on their site that the rates are not the same...that's all...not the same means one will be less than another, which one? i have no idea... if you buy from an agent you pay commission if you buy from them direct you pay overhead (basically)...get your pants out of a wad all I'm saying is per their site, they say it's not the same premium.
This post Gary is inaccruate information per that carriers site anyway..
There isn't any difference in price.
You even typed this (now) yourself above in HUGE letters.. :roll:
Posted: Mon Feb 02, 2009 02:51 pm Post Subject:
Hi Lori,
Would you care to tell me whether there's any other advantage (apart from the rates) of getting it directly from Progressive rather than getting it from an agent!
Fatman
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