Signs You Need a New Insurance Broker

Signs You Need a New Insurance Broker
Feb
05
Wed

Commercial insurance brokers can help businesses reduce costs, minimize risk, and handle claims. However, not all brokers provide the same quality of service. Businesses should be aware of several signs that you need a new insurance broker.

To ensure you are working with the best fit for your business, explore the following signs that it’s time for a new broker.

Poor Customer Service

A major sign you need a new insurance broker is experiencing poor customer service. Do you have to send multiple emails to your broker before you receive a response? Does your broker only reach out to you around renewal time? Do they make a habit of cancelling meetings with you at the last minute?

Changing insurance brokers can be an inconvenience, but not as much as having to work with an unavailable or unprofessional broker.

In fact, slow response times are not just frustrating– they can negatively impact your business.

For example, if you can’t provide a certificate of insurance (COI) to a potential client in a timely manner, you could lose out on securing a contract. If you need a new insurance policy to cover an emerging risk but can’t reach your broker, your company is left vulnerable.

Situations like these can be detrimental to both small businesses and large companies, and a broker should never put you in such a position.

As an employer, you need a responsive and accessible insurance broker who treats your business as a priority, not an afterthought.

If you consistently experience poor customer service, that is a strong sign you need a new insurance broker.

Lack of Choice

If your broker presents policy options from the same insurance companies every year, it might be a sign you need a new insurance broker.

Lacking choice in coverage options is problematic because if you’re seeing the same choices every year, can you be sure your broker is really shopping around for the best options for your business?

Granted, it could be the case that these are truly the best policy options for you.

However, sometimes certain policies come with a higher commission or compensation for the broker. It’s possible that some brokers may steer you toward policies that are more lucrative for them, rather than the choices that are best for you.

Therefore, if you feel pressured to choose certain policies or if you lack a variety of quotes to choose from, there may be some incentives at play that you’re unaware of.

Insurance brokers should always be upfront about their commission and fees.

Furthermore, high-quality insurance brokers will always search for the most competitive prices and coverage for you, and will work in the best interests of your business.

Thus, if your broker pressures you to choose certain policies, does not provide an adequate number of plans and coverage options, or demonstrates a lack of transparency, it’s likely time for a change.

Rushed Renewal Process

Whether for employee health insurance or errors and omission insurance, the business insurance renewal process should be given the time and attention it needs.

Thus, your broker should initiate the renewal process 60-90 days before the renewal date.

If your insurance broker doesn’t contact you until 30 days before the renewal deadline, it puts your business in an unfavorable position. A rushed renewal process can prohibit you from getting the best prices available and may even result in inadequate coverage.

There should be plenty of time to compare quotes and negotiate terms during the renewal process. Your broker should be an advocate for your business during this time, working to procure the best insurance coverage at the best possible cost.

Even if your policies are set to auto-renew, your broker should still contact you in the 60-90 day time frame. They should validate there haven’t been any major changes to your company or new risks that need coverage.

If they wait until the last minute to start the renewal process, you’re not getting the full value out of your insurance broker. This is especially true if they fail to do their due diligence such as asking about operational changes or negotiating terms and exclusions with the carrier.

These are significant signs that you need a new insurance broker.

Excessive Costs

The final sign that you need a new insurance broker has to do with cost. Many employers don’t realize that working with the right broker is one of the most important factors in controlling insurance costs.

Without a trustworthy and experienced broker, for example, your business could end up:

  • Paying higher prices than your competitors
  • Incurring excessive broker fees
  • Facing dramatic premium increases at renewal
  • Paying for policies you don't need

To avoid these pitfalls, it’s important to know what exactly you are paying your broker and if your costs are competitive for your market.

To evaluate if your insurance costs are competitive for your industry and company size, use the Mployer Advisor commission calculator. This tool will help you understand how the fees and commissions you pay to your insurance broker compare to similar companies.

If your cost falls into the highest percentile, it might be a sign you need a new insurance broker.

The Bottom Line

Would you recommend your broker to a friend or colleague? If the answer is no, that’s a major sign you need a new insurance broker.

If it’s time for your business to change insurance brokers, Mployer Advisor offers tools and resources to help you make the right choice, including an industry insider blog and information on finding a new insurance broker.

Start your search for a new business insurance broker today with Mployer Advisor.