How An Ex-Mod Projection Can Help Control Work Comp CostsBusiness insurance is a complicated matter. To make sure you’re getting the best coverage, rates and services, you need to enlist the help of the right business insurance broker. To find that perfect match, consider these issues.
Independent or Captive?
Once you have a policy, your insurance carrier will provide your coverage and pay out any claims. To get a policy, you typically need to go through an agent, also called a broker. There are different types of agents, but they’ll generally be classified as either captive or independent.
A captive agent works for one carrier. This means that the agent will only be able to offer you policies from a single carrier, even if other carriers may be a better fit for you.
An independent agent, on the other hand, is contracted with multiple carriers. This means that the agent can select from a much wider range of policy options in order to find that coverage and rates that best fit your needs.
Multiple Agents or One?
Employee benefits. General liability insurance. Workers’ compensation. The list goes on. You need a lot of different types of insurance. So, should you deal with multiple agents – or get everything you need from one agent?
Managing multiple lines of insurance can get tricky. Having a single agent overseeing everything can help you make sure you’re not leaving gaps or paying for more coverage than you need. Having a single agent can also come in handy if a multi-faceted claim occurs that crosses over multiple lines of insurance (such as a commercial auto accident that involves workers’ compensation).
On the other hand, if you’d like to test another broker, it might make sense to do that with one line of insurance. For example, let’s say that your workers’ compensation experience mod is higher than the industry, or you want to explore partially self-insured options for health insurance, it’s OK to venture out to see how a new broker may improve your situation for one insurance line. If you like the results, you can then move other insurance lines as well.
What About Your Niche?
You need someone who’s an expert in insurance and risk management, but beyond that, you need someone who understands the type of business you’re running.
For example, construction companies and IT companies both have risks, but the exposures aren’t identical. If you’re operating a construction company, you want an insurance expert who know exactly what types of coverages you need, and who can provide expert advice on how to manage specific the risks associated with your business.
Likewise, a small business may have different needs from a large company, and a nonprofit can have different exposures compared to a for-profit company. Before you pick an agent, see what he or she knows about your industry.
Risk Management Services?
An insurance agent will help you get an insurance policy. That much is a given. But what else can an insurance agent do for you? Specifically, what kinds of risk management and loss prevention tools and resources will you receive? You want an agency that is committed to helping you prevent claims and take control of your total cost of risk.
Are You Confident?
Selecting an insurance agent is like choosing a business partner. You need someone you trust to have your best interest at heart, while also having the expertise needed to protect your business. Whether you’re looking for an agent for the first time or thinking about switching agents, ask important questions:
- What is the agent’s experience with your industry?
- How has the agent gotten results for other businesses like yours?
- What lines of insurance can this agent/agency provide for you?
- Which carriers does this agent have contracts with? How will the agent advocate for you?
- What other resources are available to help you manage risks?
- Are there options beyond traditional insurance? Can this agent help you explore a captive or partially self-insured option?
If you’re in the market for a new business insurance broker, consider the team at Heffernan Insurance. Learn more about our specialized business insurance programs here.
