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Is Your Broker a Price Shopper or Risk Manager?
By Lorne Wiebe
OurHometown.ca

Is Your Broker a Price Shopper or Risk Manager?
The phone rang in my office and it was a potential client who wanted a business insurance quote. He was on the board of a sports association and he had been tasked by his fellow board members to get the best insurance price possible. Someone even gave him a list of the coverage they would need and the limits of insurance for each coverage. He forwarded me the document.
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Ottawa - May 16, 2013 - The phone rang in my office and it was a potential client who wanted a business insurance quote. He was on the board of a sports association and he had been tasked by his fellow board members to “get the best insurance price possible.” Someone even gave him a list of the coverage they would need and the limits of insurance for each coverage. He forwarded me the document.

Among other things, it included coverage for off-premises welding. When I asked what type of welding they do, he assured me they did none and he had no idea how that got onto the list. All he knew is that he needed a quote for what was provided and it needed to be cheap.

The next day, the phone rang in my office but this time it was a client of mine. He has a growing business and now he was ready to expand his operation. He asked if we could have coffee to discuss his plans. Great! We met later in the week and for two hours we talked about his supply chain challenges, client contracts and hold harmless agreements. We discussed various options when it comes to protecting the shipments he plans to import from overseas. My client hasn’t put any of his plans in motion yet but that’s why he called me now. He wanted to share his plans with me ahead of time in order that together, we could put in place a risk management strategy which would specifically respond to his growing business.

Insurance brokers have two roles; purchaser and risk manager. The problem lies when a broker becomes just a mindless price shopper, cutting your insurance coverage to lower your premium or not paying attention to what your real needs are. A broker should try to find you the best value, not just the lowest price. A risk manager, on the other hand, is someone who understands your business and gets you the right coverage – which may not include off-premises welding.

Look at it this way; a broker who is just a price shopper can mindlessly find ways to shave $1,000 off your premium but create $100,000 in insurance gaps along the way. A risk manager may not save you $1,000 in premium but he discovers the gaps left by the price shopper and he fixes them. In the event of a loss, isn’t it a far better return on your investment to have spent the extra $1,000 to have the $100,000 in coverage?

Is your broker just a price shopper or is your broker a valuable business partner who provides a wealth of valuable risk management advice? If you’re ready for more than just a shopper, give me a call and let’s have a coffee…it’s on me.

Presented here is a general article about insurance. The discussion is general in nature, and does not constitute insurance advice. This is not intended to be a description of coverage, and does not include details of the coverage nor the terms, conditions, qualifications, limitations and exclusions applicable. Policies should be reviewed in their entirety and related to your specific operations. Many insurers permit changes (Changes to insurance policies are usually called "endorsements" or "riders") in their limitations or exclusions to match your specific requirements. As insurance advice must be tailored to the specific circumstances of each situation, nothing provided herein should be used as a substitute for the advice of a competent insurance broker. IN NO EVENT WILL RHODES & WILLIAMS LIMITED BE LIABLE FOR ANY DAMAGES WHATSOEVER, INCLUDING SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES, ARISING OUT OF OR IN CONNECTION WITH THE USE OR PERFORMANCE OF THE INFORMATION PRESENTED IN THIS DOCUMENT.


Follow Me on TwitterLorne Wiebe is a well known former Cornwall broadcaster. Even though he now calls Ottawa his home, he has a special affinity for Cornwall and SD and G. He now works at Rhodes & Williams Insurance Ltd. and partners with the local business community to help them deal with their day to day risks. If you have questions or wish to contact Lorne, you can email him at Lornew@rhodeswilliams.com


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