5 Tips to Find an Insurance Broker
Creating a business involves a lot of risk. But successful entrepreneurs learn how to mitigate those risks to improve their odds of success. One of the best ways to mitigate risks is purchasing insurance. There are many different kinds of insurance available to new and existing businesses, including general liability, errors and omissions, property, and more.
You should research options but, more importantly, you should find and work with a good insurance agent or broker to analyze your risk and purchase the appropriate policies for your business.
Here are 5 tips to help you find the right insurance professional for you.
Commercial vs. personal
To begin, you should recognize that many insurance professionals specialize in only personal policies such as life insurance, personal property insurance, auto insurance, and the like. While these professionals know more about insurance than you, it doesn’t mean they understand the world of commercial insurance policies. That’s why you should always seek out a professional that has experience working with businesses (and if you are a new business, then someone with experience working with new businesses). That way, you can make sure you are not missing an important policy such as a directors and officers liability policy.
If you already have a great relationship with your personal insurance professional but they don’t do business policies, ask for a referral. They are bound to know many other agents and brokers (more on referrals below).
Agents vs. brokers
You should also note that insurance agents and brokers are not the same thing. Insurance agents will look for policies from only one specific carrier (unless they are an independent agent). While they may have a good policy at a good rate for you, they may not. That’s why it might make more sense for you to speak to a broker. Insurance brokers will seek policies from multiple carriers. This means they can shop around for different policies at different prices and you may find a better overall fit by going through a broker.
Your unique needs
It’s true that many businesses have similar risks such as general liability, property, and auto. Those are pretty standard and are fairly easy to cover with insurance.
However, you should always consider what unique risks apply to your business and then consider whether you need to speak to a unique insurance professional about those risks. For example, if you run a construction company building high-rises, you’ll certainly have a greater risk of injury for your workers. On the other hand, if you spend your entire career building creative assets, you may have greater risk exposure for copyright infringement.
Accordingly, you should seek out an insurance professional that has experience in those areas and who can help you find the appropriate policies to mitigate those risks. And most importantly, keep in mind that certain risks (for example, intellectual property insurance) require special policies for coverage.
Consider how they work
As with searching for any other professional, consider how your prospective insurance professional works. Some prefer emails, some prefer phone calls, and others prefer in-person meetings. In either event, make sure you and your insurance professional share similar working habits to avoid poor communication.
Get a referral
Without a doubt, the best way to find a good insurance broker or agent for your business is to get a referral. First, ask fellow business owners (especially owners of similar businesses) who they use and whether they are happy with their relationship. From there, you can check in with various trade organizations and entrepreneurial support groups in your city and you can ask your state insurance regulator for a list of professionals (or find a list on their website).