Appraisers: Watch out for this common bait and switch

Sunday, November 10, 2013

If you know FREA, you know it's not simply insurance brokers or salespeople pushing E&O insurance coverage. FREA is a true risk management organization which offers substantial benefits to its members and also provides the entire marketplace with timely and factual advice on a variety of topics of interest to all appraisers and Home Inspectors.

Today, we want to warn you about an old friend in the world of sales and marketing which has recently reared its ugly head yet again. This “friend” is called the bait and switch.

How does it work? 

Well, first you run a big ad or send a mass email blast implying your competitors have prices that have skyrocketed and then in big, bold print you tell everyone you can sell errors and omissions insurance to them at unbelievably low prices. This is the bait.

Then, when someone takes the bait and fills out an application, you break the news to them that they just barely missed qualifying for the inexpensive premium and coverage advertised.

Next, you tell them you do have good news! There is a product that is perfect for them, but it will cost a little more and cover a little less. This is the switch.

You are probably all too familiar with this type of game.

Of those that respond and ask for a quote, maybe 5% will actually qualify for the premium product featured. The rest will qualify for the other product or may not even qualify for any coverage at all.

If it feels too good to be true, it probably is.

The next time someone in E&O sales offers you something you know is too good to be true, back away slowly and check to see if your wallet is still in your pants. Then turn around and head for an advisor you can trust.

Turn to FREA where we have 20 years experience as the leader in risk management for Appraisers and Home Inspectors.

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