How does your insurance broker score?

Written by Alison Waters.

Annual insurance renewals can be rather underwhelming as at first glance it usually seems like you’re paying more for no additional cover. You may well ask yourself what value your insurance broker is providing you with.

How can you effectively measure the performance of your broker and what are the key elements that you should be looking for when selecting a new one?

Let’s look at the considerations that you can use to benchmark a broker against its competitors.

How will this insurance broker represent you in the market?

If you’re choosing a new insurance broker and want to move your existing insurance arrangements to another market, then understanding how your potential broker is going to represent you in the insurance market is vital. You need to be certain that the way your business is being presented not only showcases your risk in the best possible light but also that they  open doors with insurers to secure you the best value.

Does this broker really understand your business and the nuances of what makes your organisation unique?

Any broker can follow a basic template and ask tick-box questions, but it takes a certain and special type to fully understand your business. A good broker visits your business and makes the time and effort to understand how your business actually works, as well as appreciating its ethos. Once that broker has built a strong picture of your business, they’ll talk you through how to manage your risks, any potential exposures, and pinpoint any areas you don’t currently hold insurance cover for. 

How good is the broker’s access to market?

Something you can only assess by talking to other brokers is if your dedicated broker has a wide reach in the insurance market. By that we mean, do they go out to many insurance companies or just a few, and do they even possess the capability to cover the entire market? If you’re only being shown a couple of insurers, this may indicate you’re not getting the best value, coverage, and access to and from the market. 

Do you need specific expertise?

When it comes to placing your commercial combined or professional indemnity covers, if your broker has a specialism in your particular sector, then they may well have the edge over a generalist broker. But this could also mean they may not be best placed to advise you about additional covers such as cyber, group personal accident or trade credit insurance. There’s a strong chance that their focus will be around the specialist covers but have less focus on the more general aspects. Finding the right balance with a broker who has in-depth knowledge but can talk to you about all areas you may be exposed to is essential.

How accessible is this potential insurance broker?

If something happens, you need a broker that is contactable as soon as possible so assess how easy to reach yours is. In addition, with some brokers the process can be even more complicated if you’re only able to contact them via email or a call centre, which leaves you waiting for anything from a short while to a very long time for your request to be seen by the right individuals.

For commercial clients who rely on an expert’s support, it’s vital that your broker is there when you need them most.

How easy is it to make a claim?

The true value of the insurance policy your broker has sold you is never clearer than when you need to make a claim. 

Your broker should be able to provide effective support regardless of how complex the situation is. Making a claim can be stressful, time consuming, and at points confusing. A good broker helps you navigating this process to ensure you’re well equipped to make your claim – as well as encouraging a speedy response from all parties involved. This allows you to focus on your business and address affected areas in what is likely to be a demanding period. 

Will they be adding value?

As well as selling you insurance, does your broker offer you any other specialist services? Some may have a risk management team that can help you assess your hazards, support you with compiling risk assessments, undertake site surveys, and provide you with relevant legislative updates. Do they provide you with regular market news and insight? Do they have forums and webinars, offer training sessions around topics like cyber-security which are more and more relevant in the current climate? It's always worth looking at what your broker can do for you above and beyond simply placing your insurance cover.

Can you trust them?

A broker can earn money in a variety of ways, whether they charge you a broking fee, admin fee, or earn commission income paid by your insurance company. But sometimes there might be other earnings behind the scenes by virtue of volume arrangements with specific insurers, or the insurers themselves may also apply additional fees.

Your broker should, on request, disclose all of the money they earn from placing your business. For larger placements, fees tend to be the preferred option to ensure that anything the broker earns is commensurate to the work they’re doing for you; if you’re paying in excess of £50,000 for your insurance and you don’t pay a separate fee to your broker, then it’s worth discussing this with them to ensure you’re getting the best value for money from the services they provide to you.

Above all – do you like them?

Our local team will happily talk to you about your businesses and explore how we can support you, addressing and answering any or all of the above questions we’ve raised in this article.