Typically, anywhere from about 90-120 days before your insurance policies are due to renew, your telephone probably starts ringing off the hook with brokers who want to work at providing you some insurance quotes. It can be a frustrating time of the year for insurance buyers. My clients tell me that as their renewal dates draw near they can field anywhere between 5-10 calls per day from insurance agents who want to quote.
What a hassle. But does it have to be that way?
ANSWER: Not exactly. (But it does take some knowledge to make it easier on your office staff who will provide information to these brokers. And here is why.)
Why Obtaining Insurance Quotes Is Hard Work
Back before I became an independent insurance consultant, I was an insurance broker for 10+ years.
For example, I would make cold calls to various construction companies around California to see who would let me quote their insurance. I would then set an appointment with the office manager (every company has this “lucky” person) in order to stop by to collect some data and give him or her my presentation.
I’d sit down with the office manager, go through my agency’s highlights, ask a few “pain” questions, and then make copies of their policies … all the while explaining to the office manager why I would do a better job than the other agents.
I’d then take my arsenal of policy data back to my office, put together a submission, and fax/email it off to practically every insurance carrier our agency was appointed with and who would typically even think about quoting that industry.
My hope was to “block the markets” before any other agents had a chance to submit to that insurance carrier first, since insurance carriers will only entertain a submission from one agent. And that agent was whoever faxed in his or her submission first.
The “Unknowns” of Obtaining Insurance Quotes
But here are four very real and quite typical examples as to why that mode of obtaining insurance quotes for your company is a bad, bad idea.
- Agent-A may have a better relationship with an underwriter than Agent-B does. If the underwriter doesn’t trust agent-B, or even agent-B’s insurance agency, the underwriter may decline to offer a quote altogether or inflate the pricing in order to compensate for the unknowns.
- Agent-A’s brokerage may have placed $5,000,000 of insurance premium with one of your key carriers/underwriters in the past year, while Agent-B’s brokerage has placed nothing with that insurer and may be on the verge of losing its appointment altogether in the coming weeks.
- Agent-A may market all his/her accounts himself/herself while Agent-B uses an internal marketing department which knows little to nothing about your company’s needs and is merely “pushing paper” through the quoting process.
- Agent-A may be able to access an insurer directly while Agent-B does NOT have direct access and has to go through a wholesaler, which adds cost to you, hassle, a lack of communication, and a lack of enhanced coverages you tend to receive with direct appointments but not through intermediaries.
So, what is the best way to assign the markets to the agents who are quoting your insurance?
PLEASE NOTE: Even though I both suggest and introduce competition into the renewal process, I DO NOT BELIEVE that having multiple agents quoting on your policy renewals is ever in your best interest. I believe the best results are achieved through the selection process of the BEST agent, and then I strategically introduce competition into the process through my unique system.
Moreover, if you are a construction company, please note that the insurance industry is not like the construction industry. You will not—I repeat—you will not get better results by having multiple agents going out to the marketplace place and flooding it with bid requests. In fact, that system will practically guarantee you fewer quotes, less competitively priced quotes, and a lack of loyalty by the insurance community in general.
Trust me when I say this is the case. But that doesn’t mean I don’t have a better option for you, because I most DEFINITELY do!
(But if you’re bound-and-determined to fetch quotes the old fashioned way…maybe the below ideas will help you.)
Getting the Best Insurance Quotes Possible
Here are 5 things you can do to ensure the best possible outcome and receive the most competitively priced insurance quotes available.
- Only allow two (2) agents to obtain insurance quotes on your behalf. These two would consist of your current broker and one specially selected agent.
- When an insurance agent calls your company, hoping to provide you a quote, ask him or her which are the top 5 insurance carriers their agency would quote on your behalf. If an agent is not familiar with your industry, he or she won’t have a quick answer. (That would be a red flag and you shouldn’t let that agent quote you.) If the agent does have some experience in your company’s industry, then have him or her give you a list of the top 5 carriers … in order of preference … which they would want access to.
- Obtain similar lists from both brokers you are allowing to gather quotes. Allow your current agent to access the current carrier, but then strategically assign the next 10 markets to each of the two brokers. DO NOT ALLOW THE AGENTS TO SUBMIT TO ANY OTHER CARRIERS.
- As you continue to receive phone calls from other agents, you could ask them which carriers he or she would access. When the agent starts naming off some of the 10 or so carriers you’ve already assigned, you can explain that those carriers have already been accessed. If, however, an agent calls and says that his/her agency has a “special” or “exclusive” market that is not available to other agents, you can make the decision to allow that agent to ONLY access that carrier on your behalf.
- One of the problems is that, out of the 10 or so carriers you will assign, some agencies can access that insurance carrier directly while other agencies must go through a wholesaler. This can be both a positive and a negative. Ask the agent if he/she plans to go to that carrier directly or if they’ll use a wholesaler. Then ask them WHY. Assign the market accordingly.
In summary, if you do not assign the markets strategically, you are essentially throwing mud against the wall to see what sticks. And the problem with doing it this way is that it causes frustration for the person at your company gathering quotes, and it makes you pay a lot more premium for your renewal insurance quotes.
The Better Way to Gather Renewal Quotes
The best way to handle the renewal process is to hire an independent insurance consultant, like myself, to handle and manage the process for you. You are an expert at what your industry is. I am an expert at how to manage the insurance brokers, markets, underwriters, carriers, and how to negotiate up to 55% off your annual insurance costs.
Contact me for a free consultation on how I can be of service to you.