Questions to ask at your next renewal

5 Questions to ask your Independent Agent the next time your Business is up for a Renewal

Purchasing Commercial Insurance is one of the most crucial decisions any business owner can make and far too many business owners do not take adequate time to decide what insurance they do and do not need. Partnering with an agent, especially one who works with multiple carriers, is a great way to maximize savings while getting the ultimate coverage. Here are five things to consider the next time your business is up for renewal.

Business Handshake with a small business owner and their insurance agent at renewal.

Why should I stay with the same carrier?

Some insurance agents only have access to one insurance company or a select group of a few carriers. These agents are called captive agents.  Using a captive agent limits the amount of carriers who are competing for your coverage.  Choosing an independent agent who has a partnership with many carriers is an efficient way to get quotes from multiple carriers all in one place. No matter which type of agent you partner with, they should have a good answer for why you partner with the carrier that you are partnering with and the answer should include more than just price. Sticking with the same carrier for multiple years can be beneficial to you when you are looking for discounts and when a claim occurs. If you have been with a company for multiple years, they are much more likely to dig deeper for discounts or not raise your rates after a year in which you had several claims or one large claim.

How many Insurance Carriers do you Actually Quote my Policy with?

All insurance companies are not created equal.  If one company has a drastically lower price, it is more than likely the policy does not cover as much or the company does not service the policy as well as other carriers. Insurance policies do not have large margins. Dramatic discounts on comparable products are not common. The only way to discount a product is for the carrier to cut in to their profits. It is not a good idea to switch carriers every year for a tiny dip in price, but it is important to look around to make sure your current carrier is giving you a competitive price.

How much experience do you have with my Industry?

It may seem like a good idea to partner with an insurance agent right down the road who is readily available and their kids go to the same school as your kids. In many situations this is the case, but not if you are in a unique industry that has unique risks. Take for example if the insurance agent down the street specializes in personal insurance (Home, Auto, and Life), yet your business operates installing solar panels on the side of a house. This is a specialized industry that includes several workers compensation class codes. If your business is placed in the wrong classification code it can cause your business to pay immensely more in premium or it could cause a claim to not be covered. This may be a situation where a specialized carrier may be better than the guy down the street.

Additionally, your business has to take into account that you are selling a new technology, you have employees climbing on top of a house to install it, and you have to store the materials at your facility in a climate controlled warehouse.  A young insurance agent who typically quotes health and life insurance may not be prepared to handle the intricacies of your businesses situation. In this case, you might be able to get more personalized service from an insurance agency across the country who specializes in protecting your particular industry.  With technology the way it is today, communication is faster and more efficient than ever. Location should not be the only factor to consider when determining which agency or carrier your business decides to go with.

What am I Missing? 

Questions that should always be asked of an insurance agent at renewal include:

  • Is there any insurance coverage that you’ve not offered to me?
  • Should I have this insurance?
  • Why should I have this particular insurance policy?
  • How much will the additional coverage cost?
  • Can I afford this risk without coverage?

These are all questions to ask your insurance agent and you should be satisfied with the answer they give you. If your agent is thorough, you will be offered multiple options to either buy or decline. With those possibilities should be a brief description of the risks and rewards of the policy. Ultimately, it is up to you the business owner to decide which policies are best for you and your businesses situation.

Are we getting flexible billing options?

Pay as You Go Workers Compensation Insurance is a program designed to help business owner’s pay their premium in full each month based upon the previous months payroll. A traditional workers compensation insurance plan pays premium based on estimated payroll from the previous year or a number of previous years. These estimates may or may not be accurate. This can cause a business to under or over pay on premium and have either a credit or additional payments due at the end of the term. A Pay as You Go Workers’ Compensation Policy can benefit an employer in three main ways:

  1. Pay as You Go allows businesses to pay premium monthly instead of one payment.
  2. Pay as You Go frees up cash flow for more immediate business needs.
  3. Pay as You Go prevents audits because both payroll and premiums are calculated monthly instead of yearly.

If your business operates in an industry where payroll is different from year to year or cashflow is a valuable asset, than Pay as You Go Workers Compensation Insurance may be beneficial to your business.  

Workers Compensation

Knowing the right questions to ask your independent insurance agent is important to your business being protected properly. When you are ready to renew commercial insurance for your business, Workers Compensation (1-888-611-7467) has specialists standing by to answer all the questions you have about your businesses insurance coverage.

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