The Three C’s of Insurance

Daniel Crichlow
Written on January 9, 2017

Insurance can be a complicated concept. But just like the diamond industry has simplified purchases to three C’s, so too can insurance be simplified. The next time you’re looking for insurance, remember the Three C’s.

1. Coverage.

Insurance does  not cover everything. Limited coverage can be a good thing which keeps costs down. After all, many people don’t need flood or earthquake insurance. However, some cut-rate insurance policies may leave you exposed and vulnerable by giving you reduced coverage.

When you shop insurance, premiums don’t always tell the whole story. Your more expensive company may be providing you with outstanding coverage, while the lower rate may be cutting your coverage in half. Let’s take a look at this scenario.

Zach is your average driver. He was ticketed a few years ago, but otherwise has a clean record. This year, he switched to Western Saddle Insurance and saved $250 a year. Zach decides to take a drive and celebrate his savings. On the way back from the outlet mall, Zach rear-ends a doctor’s Mercedes.

The doctor isn’t horribly injured, but needs two months of rehabilitation before his is able to return to work. A court awards him $225k for lost wages, $98k for the hospital stay, and $10k to replace the ‘Benz.

A few days later, Zach receives a notice. Western Saddle Insurance is paying $10k for the property damage, but is only $100k of the remainder. Unfortunately, the new policy Zach purchased reduced his coverage and left him with over $100k in debt.

Whenever you switch insurance, make sure you compare coverage.

2. Company.

Let’s consider another scenario.

Addison has been with Western Saddle Insurance for 25 years. She’s only had 4 claims. Two of them were auto accidents she didn’t cause. The other two were home claims after bad storms. None of the claims cost more than $10,000. While paying her policy, Addison begins to think about these claims.

Each time, she had to fight with Western Saddle to get what she was owed. When her roof was damaged by hail, it took six months for them to approve the claim. She makes the decision to switch companies.

As she looks around, a friend suggests Northern Ranch Insurance. She asks around and finds out that her neighbor Ron is a Northern Ranch customer. Ron’s house just burned down and Addison feels the pain for the long fight he has ahead. Much to her surprise, a construction crew starts work the next week.

She walks down and talks with Ron. Ron is happy as a lark. Northern Ranch replacing the siding and brick on his house which was damaged. But they’re also paying for a full replacement of the undamaged siding and brick so that the house looks consistent.

Addison makes the switch.

Picking the right insurance company can make all the difference when you have a claim. But when you’re doing research, it’s hard to tell the difference. You can’t ask companies directly about their service, and since people prefer complaining to praising, online reviews slant heavily toward the negative side.

Working with an independent agency like Capitol Insurance can be a huge advantage. Years of experience allows an independent agent to help you choose the right company and the right coverage. Even if you have problems, an independent agent will fight for you.

3. Counsel.

Independent agents are so vital to the insurance process. But just like any choice, you can make the wrong one. When you look for an agent, consider the counsel they offer.

It’s important to choose an agent who will be able to find you a good company with good coverage and explain the policy to you. Here are some things to look for in the counsel you are receiving from your agent.

Overall knowledge.

Does your independent agent actually know what coverage they are offering you? Put them to the test! If they’re a good agent, they will be able to answer every question you have in detail. Asking questions confirms an agent’s experience and helps them understand you are serious about finding the best possible coverage.

Risk Management.

Does the agent look at the price tag or how it will help you lower your risk? Everyone loves smaller premiums, but the smaller price means more risk. Make sure your agent helps you balance the cost and risk of each policy.


How many companies does your agent represent? If you call an agent who only represents Western Saddle, chances are they are going to think Western Saddle is the best company for you! Independent agents have a wide range of companies from which to chose. Having multiple companies means the agent can provide you with a great policy at a great price. Even if things start to go awry, the agent can switch your insurance but still be your primary contact. Like a good accountant, an independent insurance agent is a relationship which will develop over the years.

So, next time you are thinking about switching companies, think about the three C’s. What you find will be surprising.