Benefits of engaging insurance broker
You must have heard that an insurance broker or agent can help you secure good insurance deals. This can be true only if you are able to find a right one. All insurance brokers are good in their own right. But I don’t like that kind of generalisation. Any insurance broker that is able to help you achieve your insurance needs at a reasonable cost is the one that can be considered a good insurance broker.
The benefits of working with a good insurance broker cannot be over-emphasised. They don’t work for insurance companies as insurance agents do. Instead, they work for you and ensure that they help you secure insurance solution that meets your personal circumstances. Because they work with many insurance companies, they will be able to different quotes from which you can choose the best one. Even, if you don’t have time to do the comparison, they can advise you based and their experience and best judgement, on the one that best suit your situation. People usually have a misconception about buying insurance through a broker. They think that the insurance broker commission will constitute to paying higher insurance premium. It does not always like that. If the insurance broker is commission-based, it means that he will receive his commission from the insurance company he is selling their product. Though, that commission is part of the premium you are paying but it does not increase the insurance rate you will paid if you buy directly from the insurance company. So, instead of paying increased rates, insurance broker can help you secure your insurance at a good rate. Besides, they are skilled and will be in a better position to offer professional advice regarding the type of insurance you want to buy. When it comes to insurance terms, they can help you ensure that the coverage and non-inclusion items are well spelt out. Insurance broker can also help you facilitate your claims.
How to find a good insurance broker or agent
So, in your quest for a good insurance broker, you need to take some steps. Of course, this may require some efforts on your part. I think it is worth the effort.
- Decide your insurance needs. Before you start searching for insurance broker, it is essential that you first define your needs. In fact, this is necessary especially if the kind of insurance you want to buy is a specialised one. For example, if you need special coverage insurance, you need to seek for insurance brokers that handle and understand what such coverage covers.
- Ask for referrals: At times, what you are looking for is just a stone throw away from you. Through the word of mouth, you can actually get referrals from people who have engaged brokers before. You can ask your friends, colleagues, relations, club members is thy can refer any insurance broker. Referrals from satisfied customers can be a good and reliable way by which one can get a good insurance broker.
- Screen the insurance brokers: The same way you compare insurance quotes, you must screen the list of insurance brokers you have to a manageable number. Then you can now take a step further by interviewing the shortlisted brokers. Among such things that you can use to decide whether to engage a broker or not are the following:
- Credentials: What types of relevant credentials does he possess? Does he belong to any professional association? People with professional membership are mandated to update their knowledge on a regular basis.
- Is the person an agent or a broker? As explained, agents work for insurance companies while brokers work for you. Whether an insurance agent or broker, you should ask for the way they are being paid. It is better to choose commissioned based broker than a fee based. The way a broker is being paid may determine whether you will pay more than normal insurance rates or not.
- Years of experience: How long has the broker been working in that capacity? An experienced broker with years of track records can be more reliable.
- Technical knowledge of the product: There are different insurance products in the market. People who specialise in specific products tend may prove to have technical knowledge of the insurance product you seek to purchase.
- Quotes: The number of quotes and their rates may help you decide whether you will be able to work with a particular broker or not.
- List of clients: Who are the clients of the broker, both individual and corporate? A good insurance broker should be ready to give you the names of his clients.
- Customer’s complaints: What are customers saying about the broker? You can get to know about customer’s complaints by asking for comments from existing customers. You can also find out what people are saying about the broker from review websites or social media.
- Working hours: Is the office of the insurance broker open for business all through business hours? What of weekends? Is there any way you can reach him if anything should happen outside the working hours. Since accident is not predictable, you should be able to have access to your insurance broker when required.
- Good customer service: Brokerage is all about service. Anyone or firm who does not have a good track of customer service may not be good one for you. If he did not treat existing customers well, don’t think that your case will be different.
- Personal qualities: A good insurance broker is expected to be a person of high integrity. Insurance brokerage requires trust. As long as you pay your insurance premium, you should be able to go and sleep without having to worry about whether has defrauded you. In fact, it is expected that insurance broker should make full disclosure of how he is being paid and how it affects your rates. This will help you make informed decision as to whether to engage him or not. Broker should not lure you to make a decision that you wouldn’t have made if you have good knowledge of the situation about the transaction. In addition, your insurance broker is expected to have a very strong energy level.
- Make your choice: With all these put together, you should be able to make your choice.
Duties of Insurance Broker
If you decide to engage an insurance broker, you should understand what to expect from him. In this section, I will be explaining the duties of insurance broker.
- Your insurance broker should be able to provide you unbiased professional advice on how to make most of your insurance budgets and cover. Insurance brokers usually deal with many insurance companies. This makes them to have access to varieties of insurance products. They usually have good understanding of the benefits, exclusions and costs of competing policies which you as a layman may not understand. Apart from the costs aspect, he should be able to explain your policy and explain to you certain issues which are not clear to you. He has the fiduciary duty to act in your best interest
- When it comes to insurance coverage, your insurance broker is in a position to advice on the level of coverage which may be sufficient for you. He will ensure that you buy adequate insurance while at the same time prevent you from throwing money on features which are not relevant or adding value to you.
- Negotiation: It is the duty of your insurance broker to negotiate competitive premiums on your behalf. In order to achieve this, they may even request for customized insurance solutions that are specifically designed to meet your needs.
- Collection of insurance premiums: You can pay your premium through your insurance broker. However, you should insist on getting official receipt as evident for such payments
- Advice on making claims: When it comes to making claims, you should not be surprised if your claims are rejected. If you have an insurance broker, he is in a better position to advise you on how you can make claims on your policy.
- Reviewing and amending existing policies: One of the reasons some insurance claims usually suffer rejection is the failure of the insured to review or update their policies. Events to change. And for every change of events or circumstances relating to your insurance policies, you need to let your insurance company aware of this. You may not have intention of hiding information from your insurance company. But due to ignorance or your non availability, you may not amend your policies when necessary. It is the duty of your insurance broker to help ensure that your insurance policies are updated on a regular basis.
- Your insurance broker will be able to keep up with changes in the insurance market. Except your profession relates to insurance, it may be difficult for you as an individual to monitor news and development which may have something to do with your insurance policy
With all these, I think you can decide whether you should buy your insurance policy directly from the insurance company or you should engage an insurance broker. In conclusion, if you think you need an insurance broker, endeavour to engage a professional.