Do you need an insurance broker to buy a business insurance policy? The answer to that question is no. There are a lot of ways you can purchase business insurance, you can go online and purchase directly from an insurer or an insur-tech – which is like a traditional insurer but they rely heavily on technology to execute a buy order. You can buy from a captive agent who represents just one insurance company, or you can use a traditional independent agent or broker who represents multiple insurance companies.
In this article, I’m going to talk about each option, the good, the not so good, and the downright bad. There are two points to make upfront – Business Insurance is intended to protect what might be your most valuable asset so getting it right and keeping the protection right is really important in my mind. Second time is money – you can always make more money, but you can’t make any more time so I a lso want to talk about efficiency in this process.
So, which way is best to go? I’m going to answer that question in just a moment.
So, you’re shopping for business insurance. You type into Google some search phrase, like: business insurance for plumbers, or buy workers compensation insurance, or any number of different options about business insurance.
What do you get in your search results for business insurance?
You’re going to get millions of options and at the top of the ranking are likely going to be big insurance companies, mixed in will be digital brokers and insur-tech firms who are technology driven insurers and sell mostly in a human-less way, and way down the list you might find an insurance broker or two, like me.
It’s difficult for me to not have a bias about who or what I think is best, I mean, after all, I am an insurance broker. So let me turn this around and start with what I think you want as an end result.
I think most buyers want the transaction to be somewhat easy, at least not difficult.
Buyers want to be guided to making the best choices, and not feel like you’re being sold something.
Buyers don’t want to overspend on premium, everyone wants to feel like they’re getting a good deal.
Buyers probably want support after the sale which is professional and efficient.
And I think most of all buyers want to feel like they’re being taken care of. Like I said at the beginning, business insurance is meant to protect your business which is a huge personal asset for you.
Okay, is that a fair assessment?
If that hits most of the issues let’s take a minute and look at buying direct or what we call do it yourself insurance. In these scenarios you go online and fill in a bunch of boxes, check off your options and you get a quote. Sometimes you’ll get three choices – Good, Better, Best, or something like that. You like it – you proceed to bind the policy.
The good is that it’s fast and really easy.
The bad? You are the de facto insurance expert and have to make choices and answer questions on topics you may not known enough about. When something bad happens – which is the reason you buy insurance – will that DIY policy stand up? Be enough? Do you want a question mark here? Probably not.
The other thing is that the policy document which is 30 to 150 pages long is a contract. It binds you to the insurance company’s terms and conditions. Are you going to read that and more importantly understand it? I think it’s a safe bet you’re not, and I get that, but this is where the problems are buried and you’re not going to know about it, until, like I said bad things happen.
The other thing is that how do you know it’s the best deal price wise you’re going to see? If that’s part of your decision making criteria then you’ve got to go through this process 3 or 4 more times to get optional quotes and then the fast and easy goes out the window, and at the end of the day how do you make the decision on which is best? The lowest price? If that’s the sole criteria, I’m sure you’ll agree that the cheapest often isn’t the best.
Okay so you move on and go to a captive agent like Allstate, State Farm, or Farmers. Here you’re getting some advice and guidance and likely helpful people to work with down the road. But, going back to that choice or option issues again, here you’re getting one quote. Is it the best? On the factor of speed- maybe it’s not as fast as going online, but here you’re working with a live human which I think is a good thing.
Next is working with an independent agent or broker. These are firms like mine who represent multiple insurance companies who can do the shopping for you, review multiple quotes and come back with their best recommendation. Independents are known for putting customer service first and building good client relationships.
But with that said, it’s important to understand that as a group, independent agents are all really different – big, small, different levels of expertise, different levels of market representation, different ways of doing business, etc. Get 10 agents in a room and they’ll all be different, and this complicates things a bit for buyers.
So back to the question, do you need a broker to buy business insurance.
The answer is no. But I think I’ve identified some of the reasons why you would want to use a broker – expertise, human interaction, advocacy, etc.
So now the question is, how do you choose the right broker, if you’ve decided to not go it alone and DIY your business insurance?
Well this is where it gets a little complicated.
My suggestion is to look for someone with expertise in your industry or in the specific type of policy you’re looking for. If having a local agent is important to you, include your zip code in your search phrase. You are going to have to look at a lot of websites and have a few conversations to find the right fit.
Now here’s my big sales pitch.
You’re on YouTube watching me talking about selecting a broker and how to buy business insurance. You can continue to search on YouTube, or you can contact me and have a conversation.
First thing – I’m not a high pressure sort of sales guy and that should be evident by this video. Second, it’s just a conversation. You tell me what’s on your mind, what you’re looking for help with and I’ll tell you if I can help you. Third, I’ll let you know what were going to need to help you and how long it’s going to take.
If that works for you, no need to go through endless searching or frustration – just reach out.
Thanks!
