Insurance is more than a commodity – it is the very thing that can keep your business afloat should disaster strike. It also has bottom line functions. It can increase investor appeal and help a company remain profitable during downturns. proper insurance is more than just a requirement, it is an essential business decision that should be made with care and knowledge.
Selecting an insurance broker for your company’s risk management needs is akin to choosing a partner with whom you’ll have a business relationship. Cost may be a concern, but it should not be your primary concern. So what then should you look for when selecting a commercial broker? Here is a roundup of considerations
What Type of Carriers and Coverages do They Offer?
One of the best ways to decipher a quality broker is by studying the carriers they represent. Only the most responsible and fiscally sound brokers get contracts with the best carriers. Make sure they work with A-rated carriers. Check out their financial stability rating on Credit rating bureaus such as Standard and Poor’s and A.M. Best.
Also, investigate what insurance products your broker offers. Do so with an eye toward the future. Today you may be looking for a run of the mill Business Owners Policy (BOP), but what are your insurance needs in the future? As your business grows and changes, your insurance needs will likely do the same. Start a relationship with a broker who has the products and expertise to grow and change with you.
Lastly, look for a broker who can provide you with international coverage policies. In today’s tech sector, international operations are often the standard. Make sure your broker has access to policies with worldwide coverage.
Does Your Broker Know Your Industry?
Today’s business world is more specialized than ever. Since a broker is like a partner in your business and risk management, it‘s essential they understand your industry. Like other professionals, brokers sometimes specialize in specific industries.
Broker expertise is required to secure the best insurance coverage at the best rates especially with emerging technology businesses involved in blockchain or micro-mobility solutions. Not every broker is an expert in every risk. Be sure your broker knows your business.
Look into Your Broker’s Licensing and Operations
Most states require brokers to have a license and maintain continuing education requirements to sell or service insurance. Look for a broker that has the appropriate licenses to deal with your company’s geographical operations. If you conduct business in multiple states, be sure your broker has the proper licenses to secure your coverage in those states.
The same logic applies if you conduct international operations. You need a broker who has the proper licensing and contracts to obtain global coverage for your business.
Technology Should Foster Ease and Efficiency
When it comes to your business, select a broker who can offer you digital solutions to your most pressing concerns. For example, investigate the broker’s application process. Can it be completed digitally? What is the time frame for the submission process? Can the broker supply digital quotes?
Next, consider policy documents. Can your broker offer digital policy documents and endorsements? Can you bind a policy electronically? Of most importance to many commercial operations is the process of obtaining a Certificate of Insurance (COI), look for a broker who can provide digital COIs promptly.
There is nothing more frustrating than holding a bid or contract while you’re waiting for your broker to complete a COI.
A Smooth Quote Process is a Good Sign
The quoting process can speak volumes about how a broker operates. A competitive and best rate quote depends on gathering the most applicable underwriting information. Are your broker’s questions regarding your operations and their scope relevant? Do they understand the nuances of your business? Is the online submission process easy to navigate?
Also, ask yourself if the quoting process is professional. Does the broker inspire trust and confidence?
Claims Expertise is Essential
Claim time is where the rubber meets the road. A broker with a good track record in claim handling is essential. Find out what kind of claim services the brokerage offers. Do they have an in house claims team to handle the details of your claim and make sure you get a proper settlement?
Ask your broker about past claims handling experience to get an idea of their claim practices and services.
Customer Service Requests
Often once a broker secures coverage for your business, they turn your file over to an account executive who handles your coverage throughout the term. As your business grows and changes, your insurance coverage will likely change too. You will need endorsements, certificates, and have questions about coverage during the policy term.
It is essential that your brokerage can respond to these requests quickly and efficiently. Before selecting your commercial broker, ask about their policy service procedures. You may even like to meet the other team members who service your account.
Investigate the Broker’s Reputation
In today’s connected world it’s easier than ever to find reviews and testimonials about brokers. Check out third-party reviews and discussion threads on sites like Reddit. You can also ask the broker for testimonials or case studies from clients whose businesses are like yours.
Knowledge of Claims Reporting Procedures
When it comes to claims, a policy contract outlines the rights and responsibilities of the policyholder and the company. Failing to meet your requirements when filing a claim can lead to delays and possible a denied claim. Every contract may have different claims reporting timelines, but most policies require a claim to be filed within a timely manner.
It’s crucial your broker is familiar with your policy claim guidelines. Look for a broker who can offer instruction on the claims process, should something come up. For the best outcome, you must know where and how to report claims.
When it’s Time to Change Insurance Brokers
Knowing how to select a commercial broker is helpful, but what if you already have a broker and are less than satisfied. Some signs may signal it’s time to look for a new broker.
- Slow or no response to requests: If you must email your broker more than once for simple questions or COIs it may be time to look around. Fast and professional service is the hallmark of a good broker, and no business has time to chase down endorsements or certificates.
- Unclear renewal process: The renewal is critical. It is the time when your risk is examined for changes and resent to market. There is a chance both coverage and premium change during the renewal. Make sure your broker keeps you informed on the renewal process and every coverage change that applies.
- Too few quote options: A good broker gives you several quote and coverage options. Although the quotes may appear similar, look for small details that differentiate one quote from another. If your broker can’t offer you quote options on limits and deductibles, it may be time to shop around.
- Lack of insurance expertise: The insurance world can be complicated, so your broker should serve as your insurance expert. Your broker should be able to explain your policies, how they protect you from risks and how to manage them.
If you’ve decided to take the leap and change your broker, the first step is to find a replacement. Use the above considerations to find a broker who is a good fit for your business now and in the future. If your new broker represents the same carriers, they may be able to file a broker of record change. This means your policies remain with the same carriers, and your new broker assumes the service and renewal.
Why Founder Shield may be the broker for you
We consider ourselves more than just an insurance broker. We strive to be a partner and resource to all of our clients and help them navigate the often confusing insurance buying experience. Through our proprietary technology, we have streamlined the UX and overall insurance purchasing experience for startups and high growth companies.
We are a team of insurance professionals that provide all of our clients with insightful recommendations, cost-effective strategies and provide an unmatched level of responsiveness.
Whether you are a first time insurance buyer or feel you’ve outgrown your current provider; you’re planning to raise a Series A or approaching your IPO; you operate out of one office space, or have operations worldwide – we’ll be able to handcraft the products that are right for you to protect your business and allow you to continue to grow.
Shoot us a note here and you’ll have a dedicated Account Executive assigned specifically to you within a day.