Risk management and insurance planning are important parts of the financial planning process. Securing the right insurance begins with selecting the right insurance adviser. This checklist will help you find the right broker.

Advocate: An experienced, trustworthy, and competent insurance person should be able to point out the pros and cons of policy comparisons from various insurers as well as alert you to the company’s claims paying policies and ratings. In addition, you should be asking about the credit rating of the insurance companies that your adviser recommends to you and the longevity of their products in the marketplace that you are interested in. You want to buy risk management products from someone who will be your advocate, stand behind the products, and participate with you in the appeals process in case of a negative outcome. Is your insurance agent/broker advocating on your behalf, or looking out for the insurance company‘s best interest? Will they “stand-up” on your behalf if the insurance carrier denies a claim? Having an insurance adviser who is an advocate — sitting on the same side of the table as you — is imperative during underwriting and at claim time. You should have a sense that your adviser is looking out for your best interest, not the insurance carrier or his or her own pocketbook.

Carrier Availability: Will your insurance adviser analyze the marketplace on your behalf, or do they represent only one carrier? No insurance company can be all things to all people. Work with an adviser who will bring the marketplace to you. Insist on reviewing options from multiple carriers. They should be doing a lot more than what you can find for yourself on the Internet.

Communication Style: Each one of us has a unique communication style. Make sure your adviser's communication style is aligned with yours. Clear communication is essential to selecting the right form and amount of insurance. If your communication style does not jive with the insurance adviser’s style, move on.

Compensation: Ask how they get paid and ask if their compensation varies among carriers; try to determine how much of an impact that has on what they propose to you to purchase. Also, it is important to ask how often they recommend reviewing your personal situation to be sure your coverage is adequate and properly aligned with your financial goals. While this may not result in any change or additional sales, they should be interested in your needs routinely as part of your financial relationship.

Credentials: Many qualified insurance brokers have advanced certification in insurance and/or financial planning. Look for a broker who has taken the time to further his/her education about their craft. Having a state issued insurance license does not necessarily mean your adviser is qualified. Ask for both professional (peer) and personal referrals and look for credentials like: CFP® (Certified Financial Planner), CLU, (Chartered Life Underwriter), and CPCU (Chartered Property Casualty Underwriter) to name a few.

Expect Easy Access: Expect your calls and emails to be returned promptly. Do not stand for a “gatekeeper.” You should feel like you have easy access to your insurance broker. Your relationship with your insurance broker does not end once the policy is active. A quality adviser should take initiative to schedule a periodic review of coverage and should be easily accessible at claim time.

Experience: A well-seasoned insurance broker has had to address many different client situations. Each person’s insurance situation is unique and it requires a customized solution. A seasoned insurance adviser will help you identify areas of concern and will make recommendations to address the concerns.  

Meet Face-to-Face: Your initial meeting with a potential insurance adviser should be face-to-face. A meeting at the insurance adviser’s office will provide valuable insight. Do they appear to be organized? Are they maintaining confidentiality or are there files and papers in public view? Are their sales goals posted within the office or do you get the sense this potential adviser is client focused?

Needs Based Approach: Say “no” to rules-of-thumb. I do not use them when determining my own insurance needs and would not apply them to clients, friends or family. The right form of coverage depends on your goals, current financial position and budget. A needs based approach will flush out your goals and current financial picture. Once your goals and current financial position are identified, your broker can begin reviewing the marketplace of recommendations within your budget.

Stability: Has this potential adviser bounced around from firm to firm? Do they have a long tenure with their current firm? Insurance is a long-term promise and it is important to have a professionally stable adviser. You may wish to become familiar with the whole team who serve as back up to your account.

Insurance is for the long-term and it is risk management for the unforeseen, unpredictable and unanticipated events in your life. Do your due diligence to select a professional that provides you with service, competency, and quality so you have confidence that you properly take care of yourself and your loved ones.

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