Questions to ask your insurance broker
Do you currently use a broker for your trade insurance needs, or are you thinking about using one?
Not all insurance brokers are the same, and unless you know what you’re looking for it can be hard to tell whether or not a particular broker is right for you and your business.
Here are our top five questions that you should ask your insurance broker, and we’ll also tell you why you need to ask them.
1. Are you qualified and licensed?
This may seem like a very obvious question, but it still needs to be asked.
Sometimes when you deal with a large insurance company or brokerage you may find yourself speaking with a call centre operator who may not have a great deal of insurance industry experience.
Ideally you want to build a one-on-one relationship with a properly qualified and licensed insurance adviser. This doesn’t mean you need to meet them each week for coffee, but having their mobile number is a good start.
2. How many insurers do you have access to?
You might think that all brokers have access to all insurers, but this is not the case.
Many brokers only use a small number of insurers, and in some cases they only use a single insurance company for all of their clients.
Some brokers have their reasons for doing this, but ultimately it can lead to you (the client) not getting the best deal on your insurance.
If your broker only uses a small number of insurers, ask them why.
3. Do you specialise in business insurance?
In the past an insurance broker would look after whoever walked into their office. This means they might insure a helicopter in the morning, an old Datsun at lunchtime and a restaurant in the afternoon.
If your broker is superman and can be 100% across all of those different sectors, that’s great, but in reality no one can really claim to be a specialist in so many different areas.
A tradesman should deal with a broker who specialises in insurance for tradesmen. It’s as simple as that. At the very least you should find a broker who specialises in business insurance.
4. Do you charge additional broker fees?
Virtually all insurance brokers charge what is known as a ‘broker fee’. This is an amount which is charged over and above the cost of the insurance set by the insurer, but is still generally included in the premium you are quoted.
There is nothing wrong with broker fees and they are an important part of the business, but what you need to know is how much of a broker fee is being charged.
Some brokers will charge a $30 or $40 fee, but there are some who charge upwards of $100, which is probably a bit much for the average trade insurance policy.
5. Will you be there for me at claim time?
This is the final question of our five, but arguably it is one of the most important.
It is at claim time when a good insurance broker can really show his or her value to a tradesman or trade related business.
If you didn’t care about the claims experience you could probably just go direct through a retail insurance company, but if you want personal service then a broker is the only option.
When taking out a business insurance policy you want to know that your broker will be there to assist you through the process and be your single point of contact.
Some brokers (the minority thankfully) will simply give you the insurer’s phone number and leave it up to you, but a good broker will be standing there next to you fighting for the best outcome for you and your business.
Better Outcomes
We believe that using a broker will always lead to better insurance outcomes compared to going direct to an insurance company, and by asking these five questions you’ll give yourself an even better chance.
If you’d like to know more about using a broker for your trade insurance needs please contact us for an obligation free chat.
