If you have received an auto insurance quote online, or you have called an insurance company or agency for a home or car insurance quote, you know insurance companies ask a lot of questions before they give you a price. Why do insurance companies ask you for so much information, instead of just giving you the price quote you asked for? What do they do with your information? Do they sell it? Why do some companies ask for more information than others? In this blog post, I will answer these questions, and tell you how to get the insurance agent or company representative quoting you to do their best to give you the lowest insurance rates for the coverage you need, and all the discounts you deserve. It’s worth it to you to read this entire blog post, so you know what’s going on when an agent quotes your auto or home insurance, and how you can use it to your advantage.As someone who has spent many years quoting people insurance rates, I know how vexing it is to be asked a lot of questions, particularly when the questions don’t seem relevant to your price quote. When you are an agent quoting insurance all day long, it’s easy to start asking the questions you need answered to provide an accurate price quote, without explaining to the customer the reasons for the questions, and why you ask them.

An additional annoyance, when people call different insurance companies for insurance quotes, is some agents will ask few questions, and other agents will ask many questions, which creates confusing expectations for the customer, each time they call another company for a price quote.

The first thing you need to know, if you are calling an insurance company or insurance agency — not a company selling your information to insurance companies (e.g., companies saying multiple companies and agents will contact you for a quote, once they collect your information) — is all the questions you are asked are done so for the sole purpose of determining your eligibility and the proper rate.

Insurance companies are in the business of selling insurance, not selling marketing data. Always be sure to check a company’s privacy policy, but insurance companies do not sell to third parties the information they get when they ask you questions. The person you are speaking to is asking questions as they appear on a quote request form, or more likely these days, requesting the information as prompted by their computer software program.

I once had a customer very willing to answer questions until I was about 70% through the computer program, then he told me he felt he had answered enough questions, and I should give him the price. I explained I need to have all the questions answered to give him the best & most accurate price, and we are almost done with the questions. The customer insisted he would not answer any further questions and asked again for the price. I was staring at a computer screen prompting me to ask about anti-lock brakes on his cars. There was no way to get to the end of the quote with the price, without me inputting into the computer the answers to the remaining questions.

Since the customer refused to answer any more questions, I told him I will skip ahead to the coverage. Fortunately, the customer was willing to tell me the coverage he wanted for the quote.

However, the customer possibly missed out on an anti-lock brake discount, a discount for his occupation, and a lower rating based on his mileage and distance driven to work. I had to guess at the answers to the rest of the questions, and I can’t guess an answer providing a discount unless I’m sure the customer qualifies for it.

For example, if I knew the year, make, and model of his car had anti-lock brakes, I would have given him the discount for it. If this customer spent another five minutes answering questions, it’s quite possible he would have received a much lower rate.

Sometimes I speak to someone for a quote, and they are completely uncooperative, and complain about each question I ask. This customer was a pleasant, cooperative guy, until he felt he had given me enough information. Unfortunately, his lack of patience meant he was not quoted the best price possible for him.

Not all companies are concerned with the exact same information. For example, regarding home insurance quotes, one company I worked for wanted more information about a home’s electrical system (amp service, aluminum wiring, etc.) than another company I worked for, later in my career.

Some auto insurance companies want information about licensed roommates, and other companies don’t care about them, if they don’t drive your car and have their own car insurance.

But all companies need all the information they use to make sure you qualify for the insurance, and quote you accurately. Insurance companies often cancel policies, after inspection results tell them things about your home not accurately answered on your application, or after finding additional undisclosed drivers living at the same residence from a DMV check. You may be lucky if all the insurance company does is increase your rate. This is why it’s important for the person quoting you to ask you all the relevant questions to avoid these situations.

Maybe you have called an insurance company or agent in the past, and they gave you a price quote, while asking you only a few questions. Sometimes, agents have access to public records or consumer reports, so they know what cars you own, including the VINs (Vehicle Identification numbers), the companies you have insured with previously, or the year your home was built, and its square footage, and can answer these questions for you.

However, it’s not unusual for an agent to assume the answers to questions they should be asking you. Some agents want to quote you too quickly, and they know people don’t want to spend time answering questions. An agent making a wrong assumption can get your policy canceled, make your rates go through the roof when the assumption is corrected, or lead to an uncovered claim.

Here is an example of what type of problems can occur:

A lot of agents will not ask you when you were first licensed, when quoting your auto insurance. Some agents will assume you were licensed at age 16. For most people, this assumption may be accurate. As long as you have been licensed for three years or more, it usually does not matter.

But if you are age 24, you were licensed at age 22, and the agent assumes you were licensed at 16, you can see your policy canceled, once it has been reviewed by the insurance company underwriting department, because you have been licensed less than three years. The underwriter will know how old you really were when you were licensed from your Motor Vehicle Report (MVR).

The customer would be right to be very angry in this situation, since they are being canceled because of a question they were never asked. However, the insurance company will still cancel your policy based on being licensed less than three years, although your agent is to blame for the mistake.

Do not think negative outcomes from agent assumptions only apply in rare situations. There are many different scenarios, other than the one described above, where an incorrect agent assumption can have severe consequences for you. The result can be much worse than being canceled.

What if an agent fails to ask you enough questions to confirm the size & features of your house, leaving you without enough homeowners insurance to rebuild, if your home is damaged?

What if your agent assumes you don’t want water back-up coverage, or you don’t need additional coverage to insure high-value items limited by the basic home insurance policy?

What if your agent doesn’t confirm the cars you want to insure are registered in your name?

You could be looking at an uncovered or denied claim costing you a lot of money, or possibly bankrupting you.

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1. Be pleasant and cooperative when you call an agent or insurance company for a quote.

You may hate insurance. It’s possible the insurance company representative you are speaking to hates insurance, too. But keep it to yourself. If you are negative, condescending, or angry, the company representative is going to want to get away from you as soon as possible. They will get through the quote as soon as possible, and not care about making sure you are getting the best price.

For example, say you demand, “Stop asking me about my liability limits and deductibles, I told you I want full coverage.”

You may get quoted the lowest liability limits, which is not likely to be enough coverage if you are in an accident and sued, and quoted the highest deductibles, where you have to pay the most out of your own pocket if your car is damaged. This gets you the lowest price, but can cost you a bundle when you have a claim, in spite of having “full coverage.” Cooperating with your agent’s questions about coverage can avoid insufficient coverage, which depends on the needs of the individual customer. (You can find out more about about choosing auto insurance coverage on my website).

Smile when you are talking, even over the phone, and act like you are talking to a friend. It’s okay to ask questions, but don’t say anything to indicate there are questions you won’t answer. Your agent will usually reciprocate with doing their best to educate you about coverage and discounts. If you are nice, and the person you are talking to is rude, or seems bored or uninterested, that should tell you a lot about the company or agency customer service.

I was getting a quote one time for my auto insurance. I told the agent my car’s year, make, and model, and asked if she would like the vehicle identification number (VIN). The agent screamed at me to “Hold on!” She had been curt and unfriendly from the start of the conversation. I could understand that reaction if I was speaking quickly, and just started giving the 17 character VIN, but I was speaking at a moderate speed, and asked if the agent was ready for the VIN. I didn’t bother complaining about the rude and impersonal service. It told me everything I needed to know about the agency: They won’t get my business at any price! Although I was treated rudely, I remained friendly and cooperative.

Some agents or insurance company employees may deserve a taste of their own medicine, but getting upset and complaining does not get the results you want. You may be surprised how difficult and angry without reason some people can be when calling for an insurance quote. You don’t want the person quoting you to think you are one of the unreasonably difficult types. You want to inspire them to do their best work for you.

I once had a customer ask me why I was asking a question, not because he did not want to answer it, but because he was curious how it was relevant to the quote. My initial reaction was I was talking to someone wanting a quote, but was unwilling to provide the information needed for a quote. It reminded me of the difficult customers I had spoken to in the past, where the response to every question I ask is always, “Why do you need to know that? You don’t need to know that! That should having nothing to do with my insurance.” However, this customer did a good job communicating to me he was curious about the relevance of the question, not being reluctant to answer it.

You may not care about making an insurance agent’s job pleasant or easier. After all, it’s their job to make your life easier, not the other way around. But by being a cooperative, patient, and pleasant, you will get your agent working for you to quote the best price & coverage. Think about the feelings of the other person on the phone — not because you owe them sympathy, but because it helps you get the best service.

2. Not only cooperate by answering questions, but make sure you are being asked about all the coverage options and available discounts.

Instead of complaining about the price & time it took for the quote, if the rate you are quoted is not competitive, ask the agent to review with you all the discounts the company offers, and see if any were overlooked.

I always tried my best to quote the lowest price, even with difficult customers. But I one time overlooked a major discount with a very uncooperative customer. I noticed it after she left my office, when I could concentrate on the quote, instead of focusing on how I could get her to cooperate with me. If getting information from her was not so difficult, I would not have missed the discount.

A good agent knows giving you all the discounts you deserve helps them make the sale, but it’s not practical for an agent to review every coverage option when quoting you. Before deciding on an insurance company, ask for a list of all optional coverage available.

For example, if you don’t have health insurance, it would be good to know the highest amount of medical payments coverage available under a company’s auto insurance policy. Or, if there is coverage available for a loss assessment charged by a homeowners association under a company’s home insurance policy.

A truly professional agent will have you sign a coverage checklist, regarding all coverage available, to indicate what coverage you accepted or declined, when you apply for the insurance.

3. Before your start your auto or home insurance policy, get a copy of the application, and read it for accuracy before signing it or paying to start coverage.

Most companies require you to sign your application for auto or home insurance. Make sure you get a copy of your insurance application, and read it for accuracy before you sign it. If the company does not require you to sign the application (your initial payment shows your acceptance of the insurance), have the company or agent send you a copy of the application, so you can read it, to make sure it was completed accurately.

If your home insurance application has incorrect information, for example, if it says you do not own a dog, when you do own a dog, or you do not have a wood stove, when you do have a wood stove, make sure it is corrected. When it is discovered you have a pit bull, or a wood stove not up to code when you bought the policy, your insurance company may decline a claim, or cancel you after inspecting the property.

Checking the application for accuracy helps you avoid having problems created by an agent assuming an incorrect answer to an application question, and it can help make sure you have the correct type and amount of coverage, if you bring any inaccuracies to the attention of your agent.

Remember — a good agent asks questions to get make sure you have the right coverage at the best price. A good agent does not make assumptions. Any agent can find out your home is 1800 square feet from public records, but a good home insurance agent will confirm the square footage with you, to see if it is correct, or if you have had any recent room additions, a new deck, etc.

A good auto insurance agent won’t assume because you are single, there are no additional drivers or owners of the car. Asking about other drivers, ownership, and other things important to the insurance company, keeps you from buying a policy which is soon after canceled by the company, or is issued at a much higher rate than you were quoted.

Do you think auto & home insurance companies ask too many questions when they quote you? Tell me about it. Please leave a comment on my facebook page. Follow me on Twitter for important insurance consumer news and new blog entries at CarInsWatch.