When the owner went to file a claim for the theft, he found out that his policy did not cover the theft.
When the insurance broker had sold him the policy he had not explained that his contents insurance would only cover the tools when the trailer was parked within 100 feet of the business address on the policy.
In order to cover the equipment when it was away from the business property, the landscaper needed to have what is known as “an inland marine” policy.
This protects business contents when they are off-site of the officially listed business property.
In this case, the landscaper’s insurance broker let him down and cost him a trailer full of equipment and lost income. The insurance broker did not understand this man’s business and did not ask the right questions so that he could ensure that the business owner was adequately covered given the nature and scope of the man’s business.
This story illustrates how important it is that you choose the right insurance agent. In fact, it is probably more important than the insurance company and the policy you choose.
Your insurance agent is the key to making sure that you have the right commercial insurance policy and if they don’t do their job, it puts your entire business at risk.
Commercial insurance is more than a commodity. In many cases, your commercial insurance policy is the tool that will keep your business running in the case of disaster. If there is a theft, a fire, water damage, storm damage, vandalism, an accident, your insurance policy will allow you to replace the loss and continue doing business.
But, as we saw in the case of the landscaper, have the wrong policy is the same as having no policy. And getting the right policy comes down to having a qualified and capable insurance agent that knows his business, understands your business, and puts that knowledge to work in a way that fully protects you.
Having good commercial insurance not only protects you from loss, but it also helps your bottom line. Customers look for businesses that insured; it gives them consumer confidence to know that you care about protecting them.
Getting the right policy is essential and it’s a decision that should be made carefully, but we also think it’s critical to take a step back from that decision and first evaluate your agent.
Do you have the right commercial insurance agent or broker to help you with one of the most important aspects of your business? Your agent will be like a partner in your business, and you need to find an agent that is focused on helping you reach your business goals.
In this article we will talk about things to consider as you choose your commercial insurance agent. We will give you ten tips to help you with this important decision, point out questions you should ask during this decision process, and some of the indications that you might not have the right agent working for you.
We are confident that this information will help you as you select the right commercial broker to partner to protect your business.
Tip #1: What Type of Carriers and
Coverages Does the Agent or Broker Offer?
One of the best ways to figure out if you are working with a quality insurance agent or broker is to learn about the carrier or carriers they represent.
Keep in mind the important distinction between a captive agent and an independent broker. A captive agent works for one insurance company and is only able to sell that one insurance company’s products.
This means they may be limited in the premium prices and coverages that they can offer you. It also means that their loyalty lies with their particular insurance company and not necessarily what might be better for you as a customer.
On the other hand, an independent broker has a relationship with many different insurance companies and many different policies and coverage options. This gives you an advantage as a customer and allows the broker to put you and your coverage needs ahead of any insurance company.
If you choose the advantages that come with an independent broker, remember that only the most responsible and fiscally-sound brokers get contracts with the best carriers.
Look at the companies your broker works with and ensure that your broker works with A-rated carriers. You can investigate the financial stability rating of the various carriers on credit rating websites like Standard and Poor’s and A.M. Best.
In addition to knowing the quality of the carriers your broker works with, you can also learn what insurance products your agent or broker offers.
Think about this especially in terms of how you do business and how you want your business to grow. Does your broker offer the insurance products that meet your needs now and in the future?
As your business grows, expands, and evolves, your insurance needs will probably change as well. Make sure you choose a broker who has experience and knowledge with the full range of commercial insurance products so that they can adjust your coverages as your needs change.
Tip #2: Look into Your Broker’s Licensing
This may seem obvious, but you need a license to be able to sell insurance products. But what you might not know that insurance licenses and requirements can vary from state to state.
This may seem obvious, but you need a license to be able to sell insurance products.
But what you might not know that insurance licenses and requirements can vary from state to state.
When you are selecting the right commercial agent or broker for your company, be sure to look for a broker that has the required licenses to accommodate your company’s geographical operations.
If you conduct business in more than one state, check to see that your insurance broker meets the licensure requirements to get you coverage in all of the states that you do business.
Obviously, the same tip applies if you have an international business operations.
In a sense, by checking to see if your agent in licensed you are determining if they are truly qualified to in charge of mitigating the risks in your business.
Besides licensure, other important things to look for are their years of experience in the industry and their education and training.
Tip #3: Does Your Broker Know Your Industry?
While, of course, it is critically important that your agent or broker understand the insurance industry, it is just as important that you choose a broker who understands your own industry or is willing to ask enough questions to fully understand the scope of your insurance needs.
The agent of the landscaper that we talked about in the beginning of this article did not take the time to understand even the smallest part of the landscaper’s business.
If they had, they would have understood that the trailer was almost never at the business address listed on the policy.
It is, by nature, a mobile business and if the agent had taken the time to understand the landscaper’s business model and industry, they would have understood the importance of getting him an inland marine policy.
Does your broker or agent ask questions about your business? Do they understand where and how and with whom you do business so that they can understand the risks you face as a business owner?
Today, business is more specialized than ever. Because your agent or broker is your partner in minimizing risk, it is important that they understand the nature of your business to make sure you have the right coverage.
A broker that asks questions about your business and your industry is much more likely to get you’re the right coverage than one that is simply “checking the boxes” and handing out standard, run of the mill policies to everyone, regardless of their individual risks.
While a broker might not know everything there is to know about every industry, they should be curious and interested enough in yours to do their due diligence and research to really understand your particular insurance needs.
Be sure you choose a broker who cares enough to ask and learn about your company.
Tip #4: Investigate the Broker’s Reputation
The great thing about doing business in today’s world is that there is plenty of feedback to be found.
You should be able to easily access and research other people’s experiences with your potential agent or broker.
Before you choose a broker, you should go online and investigate the broker’s reputation through reviews and testimonials.
The first step is to google the agent’s name and agency. Have they faced any lawsuits? Are there any news articles about them? Are there any reviews?
Any legitimate agency or broker should have plenty of reviews to read. In addition, you can also ask the broker themselves for testimonials or case studies from clients whose businesses are similar to yours.
While there are always dissatisfied customers in any business, think about the overall rating of the broker and their agency.
Are the majority of the reviews positive? When you are choosing a partner to help you in your business, it’s worth it to do a little bit of research and learn about other people’s experiences.
Have a look at their website. Is it professional? Do they provide useful and education content for their clients? Do they include testimonials? You may also want to look at their social media pages (Facebook, LinkedIn, Google+, Twitter, Instagram) for reviews and educational content.
Tip #5 : A Smooth Quote Process is a Good Sign
A good way to gauge if the agent or broker is a good fit for your business and meets your expectations is by asking them for a quote before you decide to do business with them.
Getting a quotes can give you a real life example of how efficient they are (how fast they can get you a quote), how interested they are in your particular business, the kinds of companies they work with, how thorough they are when explaining the coverages you’re receive in the policies, why the premium price varies if more than one quote is provided.
Really, the quoting process can speak volumes about how a broker operates and how they will work for you. In order to get a competitive quote, it is dependent on gathering the most applicable underwriting information, so requesting a quote will allow you to assess the following areas:
Is the broker they responsive, motivated, and efficient?
Are your broker’s questions regarding your business, your operations, and the scope of your business relevant and thorough?
Do they understand the nuances of your business?
Do they understand the risks that are unique to your business?
Is the quoting process easy to navigate?
Do you enjoy working with the agent?
Is the quoting process professional?
Does the broker inspire trust and confidence?
Does the agent or broker have the ability to get a variety of quotes at different rates?
Does it feel like the agent has your best interest at heart?
Tip #6: How Does Your Agent/Broker Serve Their Customers?
Once a broker secures a policy, it is not unusual in some agencies for a broker to turn a client over to an account manager who will handle your insurance needs from there.
Before you choose a broker or agency, be sure that you understand and are comfortable with the way the agency handles their accounts.
Ask your broker about their policy service procedures and make sure you like them.
Remember that as your business changes and grows, your insurance coverage needs are likely to change as well.
You may need additional coverages added through endorsements or certificates, or you may need to have your risk reevaluated from time to time.
It is important that your agency can meet these needs and requests and respond quickly and efficiently to you.
Whatever the agency’s policy service procedures, you want to make sure they are organized so that you know who to contact when you need help.
Tip #7:Claims Expertise is Essential
Unfortunately, the whole reason that we have insurance is that sometimes we have to use it.
When it comes to choosing a quality insurance agent or broker, claim time is where the rubber meets the road.
Your agent will be your liaison between you and your carrier and the better they are at settling claims, the better your experience will be as a customer.
A broker with a good track record in claim handling is essential. You can find out what the procedures are in their agency for servicing any claims.
For example, do they have dedicated people handling claims or will your broker or account manager help you through the process?
Your broker should have a good idea about all the different insurance companies they work with. They will know who is quick and efficient about setting claims and which companies are harder to work with.
They can help you understand what to expect during the claims process before you even buy a policy.
It’s a good idea to ask your broker about their personal claims experience and fully understand their agency’s claims process, practices, and services.
Tip #8: Knowledge of Claims Reporting Procedures
In addition to having claims experience, it is important that you choose an agent who is concerned about the details.
This is because insurance companies have specific requirements when it comes to filing a claim.
If you do not meet the correct requirement when you file a claim, it can lead to delays in settlement and sometimes the denial of a claim.
For example, some policies have requirements about filing in a timely manner. It’s important that your broker is familiar with the requirements of your particular carrier and policy so that they can help you navigate the claims process successfully.
Look for a broker who understands the products he or she sells. You want a broker who has plenty of experience and training; their knowledge and expertise in the policies they sell can protect you when it comes times to file a claim.
For the best outcomes, you have to know where and how to report claims and a good insurance broker can easily help you do this.
Tip #9: Know When You Need to Change Insurance Brokers
In this article, we have given you lots of tips on knowing how to select the commercial broker for your business.
But how do you know when your current broker is not really meeting you needs and it’s time to make a change? Here are a few signs that it may be time to find a new broker:
Slow or no response to requests:
If you have to call or email your broker more than once to get answers to simple questions, make changes in your current coverages, or get Certificates of Insurance (COI), it might be time to think about getting a different agent or broker. Fast, efficient, and professional service should be the characteristics of any good broker. They should be making your business easier, not harder.
Unclear renewal process:
Renewing your insurance policies is just as critical as when you sign up for the policy in the first place. This is a time when you and your agent can reassess your risk and look for changes in your business scope or size. Often there are changes in either the coverage you need, the coverage the insurance company provides, or the premium costs over the course of a year.
Make sure you have a broker that keeps you informed on the renewal process and all the changes that might apply to your policies or business. Remember a good agent cares about the details.
Too few quotes
A good broker has access to dozens of different insurance companies and their products and should be able to give you several quote and coverage options. Although the quotes may appear similar, every policy is different.
A good agent will be able to point out these differences and advise you on the best course of actions for your particular business. If your broker can’t offer you a variety quote options on limits, coverages, deductibles, and premiums, it is time to shop around and find a different broker.
Lack of insurance expertise:
You have enough to worry about in your business. You don’t have to be a commercial insurance expert as well. Your broker should always service as the expert you need to get the right coverage. You want to be able to trust their knowledge and experience so that you can worry other things.
Your broker should be able to explain your insurance needs, the various policy options you have, the best ways to protect your business from risk, and the best carriers to help you do just that. If getting insurance feels like too much work, it’s time to find a different broker.
Tip #10: Call Insurance Professionals of Arizona
Without question, one of the best things you can do to find the right broker is to call Insurance Professionals of Arizona for a free quote on your commercial insurance policies.
Our independent brokers care about your business and know the right questions to ask to get you the coverage you need.
We have years of experience and hundreds of insurance products to choose from. From general liability to business property to cyber insurance, we can protect your company from the unique threats and risks you face as you do business in today’s world.
We know that the best way for you to be successful in your business is to not have to worry about your commercial insurance at all. This means not having to worry you’re choosing the right policy and not having to worry when something goes wrong. The right agent can eliminate all of it.
Your business is important to you. It is the way you provide for your family, your employees, and your customers. We want to help you make sure that nothing ever interferes with your ability to do business the way you want to.
At Insurance Professional of Arizona, our job is to take care of your commercial insurance needs so you never have to. We want to alleviate any possible gaps in coverage, while removing exorbitant premiums so that you can concentrate your time, energy and resources doing what you do best.
The best businesses need the best insurance coverage and at IPA that’s exactly what we do.
Contact us today and we can evaluate your current commercial insurance coverage to make sure you have exactly what you need to protect your business.
We can give you a quote with lots of options so that you know you’ve got the right policy. And most importantly, we can provide you with the right insurance agent. After that, everything else takes care of itself.
We’re here to help! Call us today.
Now It’s Your Turn
I hope this guide showed you whether you need health insurance or life insurance or you need both insurance.
And now I’d like to turn it over to you: Did you learn something new from this guide?
Or maybe you have a question.
Either way, leave a comment below right now.
I’ll be sure to ask if my broker knows my industry when I contact them. I am interested in hiring an insurance broker for my restaurant business. I’ll be sure to use your article as a reference point in the future.