Insurance: Understanding the Difference – Value vs Price

Insurance: Understanding the Difference – Value vs Price

It’s one of the age-old adages—you get what you pay for.  The same holds true for insurance.  But what really matters more, especially in today’s world?  Are you getting the value you deserve and do you see it in your ever-increasing yearly insurance bill, especially when you don’t have any claims and you pay on time?  Does it want to make you look for a better price?  We all know how to look for a bargain or clip a coupon, but do we know how to look for value or what it truly means to you?

A simple definition of value is the worth of something compared to the price paid for it.  But what price can you put on your personal belongings in the event of a fire or even worse, on your life in the event of an accident?  In the case of insurance, value takes on a different meaning.  It really means the importance, usefulness or worth of something.  When you look at it that way, you have a much easier time determining if you are getting value for the price you pay on your insurance premium.

What makes up that value?  At least three things:  the insurance product itself, the agency and the agent.  It is important to look at all of them when making decisions and calculating value.  An experienced agent will ask the right questions to understand your needs.  An established agency will always be there and have a variety of options to offer.  The product itself is the outcome of the former along with your input.

So how do you find that established agency and experienced agent?  Here are a few things to keep in mind:


Nothing beats a relationship built on trust.  And you want an insurance company that’s open and honest about their products. As the customer, you shouldn’t have to deal with surprise price changes or unexpected gaps in coverage because something wasn’t explained to you well. Look for a provider that shares your values and follows through on them. Customer support isn’t always found in a product catalogue, but it’s important to you, your family and your money.

Customer Service

Service quality and customer support are key. Your relationship with your insurance company should go beyond the numbers. What good is an insurance policy on paper if you don’t have a contact to help with claims processing? How can you put your trust in a policy without speaking with an agent who can help you understand your plan? Just as in any customer service activity you participate in, a professional and helpful experience is what matters.

Financial Stability

Insurance is meant to calm your worries. Whether you can actually get relief depends on the financial health of your insurance provider. You need a company that works with customers in mind, not just shareholders. How can you figure out if potential insurers fit the bill? There are some outside organizations that look into how insurance companies manage money and create easy-to-understand ratings based on this research.  Remember that longevity in the industry is usually held to mean stability, but in today’s climate that doesn’t always hold true.  Be sure to do your homework.

Products for You

Regardless if you are looking for life insurance, car insurance, homeowner’s insurance or something else, your agency should be able to provide you with options to fit your needs.  There are certainly agencies that specialize in one type of insurance only, and if you need to go with several agencies to meet your needs, then so be it.  Just give each of them the same once over to ensure they meet your standards and requirements before engaging in business with them.

Sound Advice

An insurance company is supposed to do more than provide coverage.  In order to give you the best option, they should listen to what you need and help you pick a plan that works for you and your budget. They should be there to answer your questions and tell you what they have learned from years of experience and industry acumen.

With a little bit of effort on your part, you will find the right agent and agency to give you the perfect coverage needed.  An experienced insurance agent will understand and explain the value you receive in your insurance policies when working with their agency.With an assigned account manager, you will receive individualized attention to help you with any questions or concerns you may have. Plus, you will have someone to provide peace of mind that you have the proper protection.

With all of these details laid out, it becomes more apparent how proper insurance policies bring value to you, but are invaluable as well — those who shop for insurance solely on price, instead of value, may save at the beginning, but may pay for it in the long run.