Some brokers make insurance producers’ jobs easier. They know the right questions to ask, understand your clients’ businesses and needs, and follow up quickly and regularly. And then there are the other kinds of brokers…
How can you figure out which brokers to work with, and which to avoid – before you and your clients waste valuable time?
While price is certainly an important factor up front, it’s not the only consideration – especially if you take the long view. A few percentage points more or less on a premium may mean the difference between a frustrating experience for your client when it comes time to make a claim, or a surprisingly easy one.
Insurance producers can figure out whether a broker can be a useful partner by asking the following four questions:
1. What level of expertise do you possess in (my type of business), and in my customers’ businesses?
Every industry has unique risks and challenges. Does the broker specialize in the risks that are relevant to your clients? Can he/she effectively communicate what your client’s primary considerations should be, and how different carriers’ plans address their specific risks? Will they help guide your conversation with your client, both informing the selection process and contributing positively to the relationship you are building?
A valuable broker will be knowledgeable in the specific fields that are relevant to your and your clients, and will understand that providing you with information and resources to help close sales and build client relationships is good business for everyone.
2. What percent of your total income do bonuses, as opposed to commissions, represent for your business?
Brokers are most typically paid in one of two ways:
- on commission
- with a flat fee (bonus)
Commissions are typically paid by the insurance companies, and can be reflected in premiums. This form of payment can also influence brokers’ recommendations, as different carriers offer different levels of commissions. It could be tempting for brokers to more frequently recommend the carriers that offer the higher commissions.
Flat fees (also called bonuses) create a more even playing field, and are based on the number of employees and months covered or total carrier premium and renewal percentage. A flat fee has nothing to do with the carriers’ interests, and removes the incentive for brokers to base their recommendation on potential earnings rather than the best possible options for you and your client.
3. If one of my clients has a loss and needs to file a claim, how will you assist me?
Will a broker be accessible and actively involved throughout the sales process, but fade into the background once the deal is closed? You and your client need a broker that continues to provide attentive service on an ongoing basis: as needs or legal requirements change, and if claims arise.
Claims need to be addressed quickly and correctly. Brokers should serve as an advocate for you and your client, providing guidance throughout the claims process. Does the broker have strong relationships with multiple carriers, underwriters, and independent adjusting firms that will help streamline and support the claims process?
4. How will you ensure that my clients’ coverage will remain comprehensive in coverage and competitive in price?
As your clients’ businesses grow and change, their insurance needs will change as well. Will this broker help you stay informed of changes in the industry, with benchmarking information and easy-to-read reports, to help you continually manage and optimize your clients’ insurance programs?
The answers to these few strategic questions can uncover which brokers will serve as a partner for an insurance producer’s business, supporting you and helping to best serve your clients.
To find out how Atlantic Specialty Lines gives insurance producers the resources to be an expert on all of the products you offer through us, contact us today at any of our offices: Virginia-(800) 368-2095, Florida- (877) 545-9100, Midwest- (800) 388-4375, Pennsylvania- (800) 388-4375 or Texas (800) 284-6858.
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