The time to begin evaluating new insurance policies for your business will be here before you know it. Before you start thinking about insurance for 2018, I want to tell you something: The way you are buying insurance might be hurting your businesses.
A Look At The Average Employer’s Insurance Buying Process
Every business has different types of risks, but the typical employer isn’t thinking about the risks. What are they thinking about? Price.
When the fourth quarter hits, employers “go out for bid” and ask several agents to provide them with specific requests. That way they can easily compare the bids to make the price-based decision. Smart, right?
Well … not exactly. Agents don’t want to lose your business, so they’ll meet the request. Right before the renewal date, agents will line up with their bids. They provide an outline of coverage and limits and might throw in a few “special” coverage enhancements.
But, in the end… you’re looking at all of the companies and plans as equal and make the decision based on price. And while price may be important, you may be opening yourself up to extreme risks that may cost you money, or even your business- down the line.
The Risky Outcome of Your Insurance Buying Process
Everything that I’ve just talked about is extremely common. Most businesses don’t even know that they’re putting themselves at risk. And the market has trained most agents to follow suit.
There are several problems with this approach. First, no one is taking time to conduct a comprehensive assessment of the employer’s risks and threats. Agents assume that the current policy is meeting the needs of the employer and are replicating that coverage to meet the request and play the price game. One of the agents might point out a few risk areas, but a comprehensive assessment rarely occurs.
As a result, all of the agents come in with a comparable program for you. This is exactly what you asked for, but it’s likely leaving you with huge gaps or errors.
- Incorrectly Named Insureds
- Inadequate Building, Personal Property, and Business Income Limits
- Inadequate coverage and limits for contractual obligations
- Inadequate transportation or off-premises property limits
- Unacceptable exclusions
- Federal violations
By leading with a Workers’ Compensation Strategy, we can magnify some of the potential risks and put a plan together to reduce and avoid risks. A comprehensive assessment can make you aware of the steps that you need to take and the business processes that need improvement.
Are you ready to change the way you’re buying insurance? Email me to get started.