When discussing your risk management and insurance program with an Insurance Broker, one of the most important steps is providing them with a copy of your existing insurance policies. An in-depth review of your coverage, combined with a thorough understanding of your operations, enables your advisor to ensure your insurance aligns fully with how your business operates. This practice plays a critical role in ensuring that your business receives the most comprehensive and cost-effective coverage available. Below, we explore three distinct reasons why sharing your current policies is advantageous to you and the importance of partnering with an advisor who truly understands your business.
Three Key Reasons to Share Your Existing Policies
1. Identifying Coverage Gaps
Your existing policies may not fully protect your business against all potential risks. By reviewing your current coverage, brokers can identify gaps that may leave you vulnerable. For example, emerging risks such as cyber threats may not be covered if your policy hasn’t been reviewed in years. Or, there may be new laws and legislature in place which require compliance like when New Jersey increased the minimum limit of Automobile Liability to $1,500,000 for all vehicles over 26,000 lbs. GVW. Addressing these gaps ensures that your business is properly safeguarded from the risks you face.
2. Ensuring Competitive Pricing
Insurance markets evolve, and pricing structures change frequently. If your policies have not been reviewed in several years, you may be leaving money on the table. Advisors use your existing policy details to benchmark against current market rates and negotiate better terms. The ultimate goal is to provide your business with the proper and robust coverage it needs for the best rate and price available. In-depth policy reviews and insurance marketplace analysis help provide your company with this desired balance and gives you the peace of mind you’re receiving the best coverage for the best price.
3. Keeping Exposures Accurate
Keeping exposures accurate is a critical part of ensuring your insurance works as intended. Your exposures play a key role in premium rating. Most policies are rated based off of payroll, gross sales, or area (sq. ft.). If these figures are understated, you may face large additional premiums after audit. Conversely, if they are overstated, you may be overpaying throughout the policy term. Keep in mind, your exposures may change as your business evolves and operations change as well. Company growth, downsizing, new services, subcontractor use, or seasonal fluctuations all impact exposure. Regular reviews and conversations with your agent about your exposures allow these changes to be addressed proactively rather than after the fact. Ensuring that your policy aligns with your company’s operations is critical in making sure your insurance policy responds the way it is intended to.
How This Benefits You as a Client
Sharing your existing policies with an advisor is not just about transparency, it is about empowerment. By allowing a risk advisor to analyze your current coverage, you gain access to expert insights that can improve your insurance strategy. This proactive approach minimizes risk, reduces costs, and ensures that your business remains resilient in a dynamic environment. Ultimately, this practice positions you to make informed decisions that protect your assets and support long-term growth.
Why Policy Review is Essential for Representation
If advisors are to represent your business effectively to insurance carriers, they need a complete and current picture of your operations and coverage. One of the most impactful pieces of an underwriting submission is the client narrative. The narrative is an opportunity for the advisor to highlight why your business is a great risk for the insurance company to take on. Whether it be discussing your best-in-class safety practices, in-depth and robust company policies, awards or certifications from accredited organizations, or a clean claims history, the narrative of operations is where your business gets to shine a spotlight on all of the factors that make it great. The policy review is a crucial step in helping your agent paint your business’ full picture to the insurance carrier that will ultimately result in you getting the best coverage available. Without an updated policy review, your advisor cannot negotiate the best terms or ensure that your coverage reflects your present operations.
Summary
Providing your insurance advisor with a copy of your existing policies is a strategic move that ensures proper protection and cost efficiency. A true insurance advisor prioritizes your company’s best interests while aligning coverage with your current business operations. This review process identifies gaps, secures competitive pricing, and ensures your exposures are accurately represented in the policy. This process empowers you to make informed decisions that safeguard your business and support long-term success.
Image by Mikhail Nilov on Pexels.
About the Author:
Brian Ciarrocca is a Risk Management Associate at Rue Insurance. He joined Rue Insurance in 2020 with licenses in Property, Casualty, Life and Health. He is CRIS certified (Construction Risk Insurance Specialist). Armed with a deep understanding of safety centric risk management principles, Brian possesses a unique expertise in identifying, assessing, and mitigating risks for his clients.
