From the December 2012 issue of American Agent & Broker • Subscribe!

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How to convince your customers that you need information.

In dealing with your customers, are you getting the truth, the whole truth and nothing but the truth?

We can’t have our customers swear on a Bible, but trying to get the truth, facts or omissions from our clients can be a challenge.

We all know how important it is to obtain accurate information to provide correct coverages and recommendations. Hard to accomplish, especially when people tell you what they think you want to hear when you ask qualifying questions for new business.

Related: read "Money Up" by Paul Morrissette.

Some questions can help clients to open up and tell the truth when purchasing homeowners’ insurance:

  • What is the residence’s square footage, year built and any property updates?  These details properly evaluate the cost to rebuild the home if that’s needed.  And as far as needing to know about the updates—nine out of 10 times house fires are caused by faulty electric wiring or a furnace gone bad. If there is major water loss, it’s usually due to old plumbing. The roof is the first thing to go on a house during high winds or a hurricane.
  • Any past claims at the residence? Knowing the customer’s prior claim history helps the insurer properly evaluate the risk. If you received a claim for a frozen pipe and it was never fixed correctly, chances are there will be another claim.  Although the customer is paying a premium of something like $600, you’re asking an insurer to be on the hook for hundreds of thousand of dollars. Would you want that same risk?
  • How is the home used? Is it a primary residence, second home or investment property?  Any renovations in the near future? Is the home in “move-in condition”?  These questions align the coverage to the correct policy form. . All too often, the use of the home is not what clients tell us.
  • Do you own pets? If the client has a dog, what breed? Dog bites are one of the top liability claims for homeowner insurance carriers. If the customer’s dog bites someone, the insurer is potentially on the hook for hundreds of thousands of dollars.
  • Do you have a trampoline? It doesn’t matter if there’s a net around it. Will a scrawny little net hold a 65-pound or heavier child? Kids don’t get hurt bouncing up on the trampoline—it’s when they come back down. It doesn’t matter how friendly your client is with his neighbors and their kids. If someone is paralyzed due to a trampoline injury, expect to be sued.
  • What jewelry or collectibles do you own? If your client is married, he or she owns wedding or engagement rings. Did the client purchase a thousand-dollar painting to spruce up the home? There are limitations on these items, and the customer probably doesn’t want a department-store settlement.

No matter how busy we are, if we don't ask the right questions, document and obtain sign offs, we could be in court trying to defend our actions.  The general public has no idea what the limitations are on their homeowner policies or how important it is to insure their investments properly

Take the time to get the facts and the truth. Try to get the prospect to answer honestly. Explain why we and the insurance companies need this information. Ask in a friendly, conversational way that does not offend or put the prospect on the defensive. Educate, educate, educate—and minimize the possibility that the customer will face a claim that is not covered.

About the Author
E. Keith Taege

E. Keith Taege

E. Keith Taege is a personal lines producer for the Van Dyk Group on Long Beach Island, N.J. He is an expert on coastal insurance and is active with the Ocean County Board of Realtors.


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