4 Keys to Finding the Best Commercial Insurance Agent
What should you expect from your commercial insurance agent?
It’s time to renew your insurance policy again, and you may have some questions about the service you’ve been getting. Or maybe you’ve never considered if your agent is doing all they should. Perhaps you’ve worked with the same agent for so many years now, and you’ve never really thought about making a switch.
Your business is one of your most important assets! Commercial business insurance needs to be in place when you most need it – when there is a fire, theft, water damage, injuries, etc. And not having the right commercial insurance agent could put you at enormous risk.
How do you go about selecting an insurance agent that is going to make sure you are getting the coverage you need? An agent who is an expert in their field and makes sure your asset is well protected?
After 20 years of serving clients at Baily Insurance, I have encountered many companies settling for less optimal agents, because it is what they have always known. Understandably, they are nervous about making such a significant switch. That’s one of the reasons I love what I do.
Every day, I help businesses discover options they had never been exposed to before! We partner together to create a complete insurance package that cares for their employees, generously covers their business, and creates a long-term plan for decreasing their insurance costs. I love helping our clients understand the complex world of insurance.
After you read this article, you will have a picture of what great insurance agents do to help their clients. You should walk away with tools to help you evaluate the service you are currently receiving from your agent or to help you if you are considering switching to a new agent.
Your expectations for your commercial insurance agent should be high! Don’t settle for anything less!
What should I expect from my commercial agent?
Here are the obvious expectations you should have for your agent:
You want an agent who quickly responds to emails and phone calls, who is proactive instead of reactive, and who is available in urgent situations (even if that means an emergency at 3 am).
Your insurance agent should have access to the right companies and the right products to meet your company’s unique needs. And they should be able to explain clearly what kinds of coverage you need and what you are actually buying.
And, you want an agent with integrity, the kind of person who if they are not charged for something they bought at the store will walk back into the store to pay for it! After all, they are protecting one of your most important assets – your business!
4 Things to Look For in a Commercial Insurance Agent
Considering these four key areas will help you decide if you have the right agent. Your agent should help you:
- Discover your risk appetite
- Provide you with HR resources
- Effectively use risk transfer
- Manage the claims process
They Should Help You discover your risk appetite
Do you know if your current insurance program is in line with your risk appetite? What I mean by risk appetite is how much risk you are willing to take.
Your agent should help you assess what you are willing to pay out of pocket versus what you want your insurance to cover.
Here is an example of a personal risk that most of us can relate to.
You’re at an appliance store looking for a new stove. You find the perfect fit! It’s a good price and it has all the features you want.
At the checkout, the clerk asks if you want to spend $100 extra dollars for a warranty that will cover the new appliance for two years. Your mind sets to work thinking about this.
If the appliance breaks in the next two years, can you afford to fix it yourself or even replace it? Or do you prefer to pay the $100 knowing the appliance will be covered if something should happen to it?
Commercial insurance is similar to this example in that you need to make a lot of decisions about what you want to be covered by your insurance and what you are willing to pay out of pocket.
For example, you may have equipment included in your commercial insurance policy coverage. You must decide if you want that equipment to be fully covered by your commercial policy which will then result in a higher premium, or if you want to incur some risk yourself, have a higher deductible, and pay for some equipment repairs or replacement out of pocket.
Commercial insurance is not a one size fits all product; however, most agents and companies treat it as though it is. As you design your business insurance program, it is important to make sure there is alignment in risk taken vs. your risk appetite.
Your agent should walk you through a process that helps you identify areas of coverage you need that you just might overlook. Insurance is complicated and great agents will have in-depth knowledge of risks their clients may not recognize on their own.
Your agent is a key player in helping you discern how much risk you are willing to take.
They should provide you with HR resources
Did you know that many of your HR policies and practices affect your insurance? Company policies regarding pre-employment, post-offer physicals, drug testing policies, etc. can impact your insurance rates and your long-term savings.
One of the areas that I help my clients with is hiring. Hiring is one of the most important tools to control your work comp costs.
Far too often employers hire a person who is a claim just waiting to happen. Arranging pre-employment physicals is just one way to help weed out potential work comp claims.
For example, if an employer is hiring someone to help load and unload trucks at their warehouse, it is essential that the potential employee is capable of performing the tasks required. Through a pre-employment physical, a doctor can verify that the potential hire is capable of performing the required tasks without danger of injury.
If a potential hire has already had shoulder surgery or back surgery, it is imperative that a physician sign-off that the potential hire is not likely to be reinjured.
Without a doctor signing off, if the employee is reinjured on the job, you will be responsible to pay for any work comp claims. Claims of this nature can cost $60,000 or more, and do not benefit you, the employer, or your employee!
Your agent should play a vital role in helping you establish hiring practices that will protect you from such potential claims.
Another HR tool that your agent should assist you with is defining proactive drug testing policies for your business. This will protect you from potential claims of employment discrimination.
Suppose you suspect that an employee is involved in drug use and even using drugs while they are working for you. This is a huge liability for you!
You, as the employer, decide to have the employee drug tested. Without a defined policy already in place, an employee can claim that they have been singled out and discriminated against ending in litigation that can cost you a bundle!
Also, depending on your line of business, if an employee is not consistently tested and that employee is operating a vehicle or equipment that you own and they injure someone, you can potentially add $1,000,000 to the claim.
Without drug testing policies in place, you expose yourself to enormous risks.
Your agent should play a vital role as an HR resource for you!
Effectively Use Risk Transfer
Another of your agent’s responsibilities includes placing risk where it belongs.
Sometimes, risk does not belong to you! It may be the responsibility of a subcontractor, a vendor, a tenant, etc. Placing risk where it belongs ensures that individuals and companies you work with take responsibility for their claims.
Large and extensive claims can be crushing to your business. What if these claims are the responsibility of another party? Without appropriate contractual and insurance language, you can get pulled into a frivolous lawsuit that could have been easily avoided.
What does this look like? Let’s pretend you own an HVAC company. Your current job requires some electrical work that you are not able to do. So you hire an outside electrician to do that work for you.
During the project, the electrician is injured at the worksite. Who should cover the costs of his injury? Are you responsible? Is he responsible? Did you make sure in advance that he had more than general liability? Does your electrician have his own workers compensation policy in place?
In advance, your insurance agent should help you prepare for occasions such as this. Your agent should help you have in place protections so that you are not responsible for claims like these.
Your agent should offer their expertise in helping you determine where risk should be placed.
They should manage the Claims Process (not just file)
One final area that your insurance agent should be assisting you with is managing your claims. When I say this, I don’t just mean filing claims.
Your agent should also be helping you to prevent claims. They should also have processes in place to minimize your costs when you submit claims.
One way that your agent can help you is mitigating claims is by establishing a physician panel to utilize when a work comp claim is submitted.
Legally, you, as the employer, can determine which doctors your employee can use for the first 90 days after a claim has been made. Without this panel, your employee can go to any doctor they want. It is essential that you have this panel in place before a claim is ever submitted.
How might this practically affect you? Imagine an employee who is injured on the job is now suffering back pain. Without a pre-approved list of doctors, your employee can see any doctor they wish to see.
I have known of instances when this has happened and the employee-selected doctor continued to supply the employee with oxycontin to manage their pain. The doctor was not intentional about helping the employee recover and return to work. Things got bad!
Eventually, the employee became hooked on oxycontin and never returned to their position. When all was said and done, the employer had to cut her losses and find a new employee to train.
This workers comp claim led to significant monetary loss! The employer also suffered unseen costs by having to start over with hiring and training a new employee.
Not only was it bad for the employer; it was also bad for the employee!
The employee ended up struggling with an addiction to pain medication and also lost their employment.
Much of this could have been alleviated if the employer had in place a pre-approved panel of doctors that she knew would do all they could to help the employee get healthy and return to work. This type of panel often provides a win-win situation for both employer and employee.
Your agent should provide you with tools to prevent and minimize your claims.
I’m not sure I’m getting the insurance expertise that I need? What should I do?
On the surface, it may appear that commercial insurance like home and auto insurance is clear cut and objective. But as you can see, commercial insurance is as individual as our fingerprints.
To create the best commercial insurance package for your business, you need an agent that not only is attentive to you and has access to the right companies and products but one who looks intently at your business as a whole.
Your agent should also help you with HR practices that help protect your business, detailing the risk that you are willing to take and assessing which risks are your responsibility.
Your agent should also help you put into place preventative practices that mitigate your claims.
Your business is one of your most important assets! Don’t settle for less!
At Baily Insurance Agency, our HR professionals specialize in workers compensation law and policies. Our licensed insurance advisors put to use countless resources that help our clients lower their workers compensation rates, care for their employees, and protect their assets.
Our agents have an in-depth process to assess your business’s unique needs, advise you on your insurance options, advocate on your behalf, and put into place an insurance package that is best for you. And we don’t stop there. We continue to partner with you by regularly reviewing your coverage to ensure you have the protection you need or to enhance the insurance policies you have in place.
We understand that deciding on a commercial insurance agent is one of the most important things you can do to protect your business. If you are looking for an insurance agent, we would love to consult with you to determine if we would be a good fit to partner with you.