If you’re a small business owner in the insurance industry, there’s a good chance you’ve seen deceptive sales tactics in action. Those claiming to offer you the latest tech, the best deals, and a whole host of other nonsense often haven’t the smallest amount of credibility. But even if a particular company doesn’t have your best interests at heart, you can find ways to protect yourself.
One of the most common types of deceptive sales tactics is the salesperson’s use of high pressure sales tactics. Salespeople can also exploit the consumer’s fears of change, or lack of time. They may use a trunk slammer to lure customers into expensive, difficult to break contracts. The most successful deceptions, however, entail a high degree of skill and the consumer’s willingness to play along. In many cases, consumers are left paying for the shoddy product or service.
Another type of deceptive sales tactic is the “silent sale.” There is no direct contact between a customer and an insurance salesperson, so consumers are unlikely to be aware of the true cost of their policies. Some companies sell illegal policies over the Internet or through magazine ads, and even the most savvy shoppers may not be aware of this shady practice. This nefarious activity is especially prevalent among smaller insurers and in small towns.
The best way to avoid the perils of the insurance trade is to always buy your policies from an insurance company that’s licensed in your state. Also, never sign anything you don’t have legal authority to sign, and be wary of anything that seems too good to be true.
As with any industry, some firms are known to be more honest than others, but no matter which side of the aisle you’re on, you should take the time to check out a company’s credentials before signing a contract. Check out their licensing and complaints against them. Finally, if you have the cash, consider a class action lawsuit against a deceptive sales firm. Doing so can ensure you get the best deal possible and avoid having to pay out of pocket for unpaid claims.
While it’s not easy to say exactly how many of these practices are out there, statistics from the Better Business Bureau indicate that the security industry ranks as one of the most dreaded industries for consumers. The National Association of Insurance Commissioners has produced a checklist to identify the most egregious companies and offers tips to protect yourself from them.
In the words of one of the attorneys involved in a recent trial, the most notable aspect of any deceptive sales practice is the damage it does to the reputation of the entire industry. In the insurance industry, there’s no shortage of scandals involving misleading marketing and sales practices. For example, a class action lawsuit has been filed against Metropolitan Life, the nation’s second largest life insurer, alleging that employees in Tampa used misleading techniques to swindle $11 million from customers over the course of a few years.