Beyond the Quote: A Quick Guide to Business Insurance Procurement

The Generic Five

1. “We have great service” = (we process certificates, and insurance changes in a timely manner)

2. “We are local”, or “we have been in business for over a century” = (we are near you or have been near you for a while)

3. “We have competitive pricing” = (we’re independent)

4. “We have markets” = (we work with many insurance carriers)

5. “We have the best people”= (our employees are nice and do their jobs)

When in reality these are the bare bones “entry level” items most, if not all, insurance brokers have.

Here is what to look for in hiring your next broker:

Do they have a Plan - Do they present, follow, or perform any service other than an annual review or quote analysis? Often brokers can help with employee training, OSHA & DOT consulting, enterprise risk management, HR compliance, claim handling, contract risk, avoiding fines, driver safety, etc. If you can't name the service, than they aren't doing it. Simply saying we offer risk management and claims consulting doesn't cut it. An annual written service timeline or calendar of service commitments should be established.

Do they Tell Your Story – Do they just help fill out insurance applications and forms or are they telling your businesses’ story to insurance carrier underwriters? Is a Co-Sign Narrative or co-created document established annually to tell your businesses history, goals, and best practices to make sure your business gets preferred treatment and pricing from insurance carrier underwriters?

Technology - Do they have electronic signature capability, online payment capability, electronic policy delivery, a mobile app, online portal, automatic renewals, Artificial Intelligence policy checking? etc? Or are they still utilizing pen & paper applications and snail mail?

Industry Specific Knowledge - Does your agent have other customers similar to your business? Or are they a generalist writing anything on Main Street? Often it is beneficial to have someone who understands your industry and the operational issues specific to your industry.

How to Switch Brokers

1.​ “Broker Selection process” where you have a meeting or two with a handful of brokers, (more than 3-5 would likely be overkill) and ask them, what are you going to do for my business the other 364 days out of the year other than that one day you place our policies, after rounds of interview, you sign a “BOR” letter saying you want to do business with them on the upcoming renewals:

2.​“Carrier Selection process” Or, you bring in one broker, against your current broker and perform a carrier selection process where each broker indicates which group of different carriers they are going to market with.



Regardless having one agent represent your company to one insurance carrier makes the most sense.

Why does one agent makes the most sense?

Underwriters will only work with one agent.

Having one agent represent you yields the best results because:

1) Underwriter Excitement- 90% of clients stay with incumbent when quoting, underwriters know chances of winning an account if working through non incumbent agent are small.

a. They’re time is valuable and they want to invest it and get best possible pricing for best opportunities.

b. The first question they ask is “do you control this account?”

c. When an agent can say yes, that underwriters excitement goes through the roof and your account is put on the top of the stack.

2) Leverage- An insurance agent can properly leverage carriers against one another in order to drive the best overall terms and pricing.

a. When an agent can’t say with confidence, “if you get here you should get it” then they lose leverage.

3) You Get To Choose Your Agent- instead of carrier choosing them for you. One agent will help you avoid having to choose between better pricing, with worse agent and worse pricing, with better agent.

4) Better Advisement- You allow your agent the ability to advise you instead of sell you.

a. Using multiple agents, turns them into sales people only, and you left to decide who to believe.

b. This opens you up to making mistakes.

5) Saves Time- Using several agents means more time invested on your part and your teams part.

6) Protects Your Reputation- in the market place.

a. Underwriters keep track of everything.

b. If they see multiple submission from different agents, they will lose interest, decline, or not deliver their best pricing.

See this laid out in a graphic in the following pages:

Why doesn’t quoting every year work?

The insurance game is a little different than what you might expect.

When one agent approaches a market it is now blocked from other agents. Carriers will only release a quote to one agent.

What ends up happening is a mad dash to the marketplace. Each agent gobbling up whatever they can find.

Unfortunately, this leaves you with little to no leverage against the carriers. Each agent only has their markets and they can’t leverage ALL the markets against each other. Just the few they got to first.

You’re 100% right in thinking competition will drive your price down. But you want that competition at the carrier level. Not at the agent level.

Think of it like this…

When Tom Brady is a free agent, does he hire multiple agents to find and negotiate the best contract? Does he hire 2-3 agents and assign them each different teams to talk to?

Of course not. They wouldn’t be able to negotiate the best contract.

Your insurance is the same way.

99.99% of the time, like Tom Brady, it is in your best interest to work with one agent.

The best part?

Now, you get to choose your agent.

Whereas, when you quote, the carrier gets to decide who your agent is (based off who landed the hot market).

Make sense?