Many large insurance companies have recently been advertising that they are cheaper when prospective customers purchase directly from them. Many thrifty buyers of insurance may feel tempted by news reports that the Bank of England will have to borrow its own money to bail out the British economy to prevent a second recession.
RiskHeads conducted research in 2010 that paints a different picture.
In order of importance, survey respondents identified the following as the main factors that influenced their insurance buying decision: price, ease, speed, and lastly, the peace of mind that all is covered.
Cost is a major concern. Many people don’t know that Business Insurance Brokers receive preferential rates from underwriters. Higher rates than what you will likely receive if you go directly to the underwriter Why? Because a Business Insurance Broker will take the time to talk with you about your business and help you choose the right policy for you. Business Insurance Brokers, who are experienced and professionally trained, will be more open to discussing all possible outcomes for your business. This results in lower-risk policies that still provide a high level of premium income. Furthermore, the Business Insurance broker takes over the management of the client’s business relationships, while also acting as a salesman. All of this is work that the underwriter does NOT need.
This is in line with the second most important factor, ease. An experienced Business Insurance Broker will quickly spot areas that need to be improved or changed in your business insurance policies. The broker can quickly handle any changes if there is a long-standing relationship. The buyer is responsible for determining what they want if you contact them directly. Research shows that dealing with a Business Insurance Broker is easier than most. Brokers are more proactive in communicating with customers and following up on correspondence. Direct enquiries to an underwriter, however, were often neglected or poorly managed. This is why? As a result, underwriters are receiving thousands of inquiries per day. However, business insurance brokers emphasize a more personal service and can spend more time dealing with policy modifications.
The third most important factor was speed. Direct insurance calculators online often provide fast quotes. Brokers take longer to respond with personalized, follow-up correspondence. However, if policy holders needed to modify their coverage later on, brokers were able make the adjustments quickly as they had a clear picture about what the business required. People who purchased direct had to fill out long paperwork, and were often caught in lengthy loops at call centre, talking to people with little insurance knowledge.