As we step into early 2024, the commercial insurance marketplace is facing significant challenges; therefore, finding a business insurance problems solved is more critical than ever. Premiums are on the rise, underwriting is becoming more disciplined, and we find ourselves in what is known as a “Hard Market.” Business owners may encounter steep premium increases or difficulty securing insurance coverage.
What’s the solution? How do you fix this problem or avoid it in the first place?
You might be facing a renewal problem or are concerned about an upcoming renewal, not wanting a problem after hearing what your peers or other business owner friends have experienced.
You may have even received a conditional renewal notice from your insurer, indicating a significant increase is on the way.
What do you do? What’s the right strategy to make it through this renewal without getting hammered?
There’s no one-size-fits-all solution, but I’ll share some ideas that may be helpful.
Why Problems Occur in Renewals: Business Insurance Problems Solved
First, let’s talk about why problems occur with an account. What are the underwriting reasons that trigger large premium increases, non-renewals, or difficult renewal terms?
- Claim Activity: If your account has had more than its fair share of claims over the past 3 to 5 years or a significant claim recently, your insurer may choose to non-renew your account. This is often the worst problem to have and the most challenging to cure, especially during hard market conditions.
Therefore, prioritizing risk control should be a priority for mid-market business leaders well before encountering renewal issues. Proactively mitigating claims before they arise will notably diminish challenges during insurance renewals. - Broker Involvement in Risk Control: If your broker hasn’t helped in this area and you’ve racked up problem claims, there may not be an easy solution, and a steep premium increase may occur. However, to lessen the blow and look to the future:
- Identify the claims you’ve had and what you’ve done to minimize their occurrence from happening again.
- Perform a deep dive into risk control identification using tools like smarterrisk.com to build projects for improvement during the coming year.
- Use this information to sell your strategy to the underwriting community. Without a good narrative and action plan, changing the paradigm is unlikely.
- Property Limits and Location: If your business is located in areas prone to windstorms, hail, or wildfires, or has a high total insured value (TIV), you may face renewal issues.
Working with a skilled broker who knows the marketplace can be invaluable. This may involve layering your values among several insurers or discussing captive or self-insured arrangements. An inexperienced broker could spell disaster for you and your budget. - Industry-Specific Issues: If your industry has an unfavorable claims history or potential for catastrophic claims, the insurance marketplace may either non-renew accounts or apply significant rate increases.
Each situation is unique, and a skilled and experienced broker is essential.
Importance of Broker Relationships
Many clients are frustrated by the lack of relationship with their broker, often due to acquisitions or retirements.
This can lead to a less experienced account management team, which undermines confidence. Business insurance should provide peace of mind and confidence.
If these are lacking, it might be time to find a new broker.
Conclusion: Business Insurance Problems Solved
The bottom line is that you and your agent need to identify the problem and focus on a solution. While thoughtful, intuitive, and creative brokers can develop a strategy, many fail to do so, leading to a worst-case outcome.
You need someone who can think outside the box and is highly experienced in the marketplace. This may require interviewing several brokers to find the right fit.
I’ve been in the commercial insurance industry for over 40 years, tackling and resolving nearly every issue. My team consists of seasoned professionals dedicated to their responsibilities.
If you’re looking for help with your insurance program, give me a call, and let’s chat. I promise no high-pressure sales tactics—just a conversation to see if we might have a solution for your situation and be a good fit moving forward.
