Maintaining stable premiums in a hardened insurance market can be daunting. When the market tightens, with reduced capacity and even Insurers withdrawing from the market altogether, Brokers must proactively manage their clients’ expectations. Clear, transparent communication is key. Clients should be informed early about the market conditions and the potential impact on their premiums.
Here are the top 10 steps to learn for Insurance Brokers.
- Review renewal listings early, ideally four months in advance. The earlier, the better!
- Identify problematic risks where the market is hardening, facing capacity issues, or experiencing withdrawals.
- Discuss with the incumbent markets to understand their likely renewal position.
- Initiate discussions with your client, sharing communications to ensure a fully transparent process on the state of play. Consider remarketing with your client if it is a desirable strategy. Have a well-researched list of suitable markets beforehand for discussion, as well as the pros and cons of each.
- Involve your client in the risk profile presentation process to gain their input and confirmation.
- Consider engaging an independent risk engineer. The cost should be viewed as a long-term investment in achieving optimal capacity, policy and premium outcomes.
- Encourage your client to adopt and prioritise risk recommendations to demonstrate a proactive risk management culture. Offer support where possible.
- Provide your client with regular detailed updates during the renewal process regarding market responses and progress in general.
- Communicate likely best-case outcomes as soon as practical and before presenting your renewal report to ensure no surprises.
- Clients want to feel that they have been engaged in the process, provided transparent information on the market responses, and given time to adjust their expectations. They want to be confident the best outcomes have been explored and achieved, even if this means increases well above budget expectations.
Trust is earned, not given. By maintaining a well-prepared, open, and transparent process, you can gain greater respect and trust, even when delivering unexpected news. Avoid surprises related to premiums, and use these moments to showcase your skills as a broker.
