General liability insurance… how do you reduce the cost of your business insurance without driving yourself nuts?
In a minute I’m going to give you the 5 steps that I think will help you get the best deal on your general liability insurance but I recognize that you’re busy and shopping for insurance is probably a big pain in the ass so if you want to chat about how to get the best business insurance in a strategic and thoughtful manner then just reach out.
Here are my 5 steps to help reduce the cost of your general liability insurance:
Step 1 – Hire the best insurance broker first.
This may sound counterintuitive but DO NOT under any circumstances do you want to shop your general liability insurance out to several brokers.
The shopping or bidding out of your GL has been around forever, but that doesn’t make it appropriate or right.
In fact, it’s the least strategic thing you can do to get the best results. I did a video you can view here: Why Quoting or Shopping Your Commercial Insurance is Ineffective
Instead of the traditional shopping exercise, contact 3 or 4 insurance brokers and interview them. Tell them what you’re looking for and see how they respond.
Do they have a process to make sure what you have is right?
Do they have a process to approach the marketplace?
Do they represent the types of insurers that are looking to write accounts like yours?
Do they have experience in your industry?
What’s their experience level?
Lastly, do you get a sense that you like them and feel like you can trust them? If that connection isn’t made, then you’re not talking to the right broker.
Step 2 – Bundle your policies with the same broker.
Yeah, you may be looking to just get your general liability costs under control but bundling all your policies with the same broker does two things.
First, it gives the broker more leverage in negotiating your whole account instead of just one policy in the marketplace.
Second, it gives the broker a greater incentive to do their best job for you.
The bigger the premium they have to work with means the greater the commission they’ll earn, and that means more motivation to work as hard as they can to get you great results.
It’s just human nature to be motivated this way.
Step 3 – Demonstrate your company’s commitment to safety and risk control.
If you don’t have a safety culture and the tools to support a safe work environment then I’d recommend going back to Step 1 and finding a broker who can help you do those things.
Fundamentally, insurance company underwriters reserve their best pricing for companies that are committed to preventing claims.
For you to get the best pricing in the market you need to demonstrate why you deserve it and that means providing your broker copies of your safety manual, risk control materials, and finally your loss history for the past 3 to 5 years.
Step 4 – Be prepared.
That means prior to engaging with the right broker you’re going to work with have all the materials and information you’ll need to kick off the process.
That includes full copies of your policies without any redactions, drivers licenses of all drivers – if you have a business auto policy, updated payroll and sales information, 3 to 5 years of your loss history often called your loss runs which you’ll need to get from your current insurers, and as I mentioned in step 3 copies of your safety and risk control programs.
The other thing about being prepared means you’ve got to start this whole process about 4 to 5 months in advance of your renewal for it to be ultimately effective.
Step 5 – Be upfront and transparent in honest conversations with the broker you have selected to work with.
Don’t sugarcoat anything and don’t hide information.
The more transparent you can be and tell the broker why you’re going out to the market and what you want from them, and how you want the future relationship to look, the better job they can do for you.
Here’s the bottom line on General Liability Insurance
Everyone wants to pay less for their business insurance including general liability, but getting the wrong coverage program at a cheaper price doesn’t make sense, and working with a broker that you don’t like or don’t trust doesn’t make sense either.
Finding the balance between getting great services and ongoing support as well as great pricing is a strategic process.
The 5 steps I’ve identified above are a bit abbreviated but should give you a good thumbnail on how to approach them.
Want more information or guidance – or want to interview me as a possible candidate to work with on your renewal? Reach out and let’s connect.
I promise no hardcore selling or other pushy insurance sales stuff. Just a conversation to see if we’re a good fit and can answer the questions in step 1 to you’re liking.