Choosing an Insurance Provider

Much research needs to be done before choosing an insurance provider that will be able to meet a company’s needs. A real estate manager must learn not only about the reputation of the company but also about the insurance agent or broker that will be assigned to the account.

Insurance company specific agents who work for a specific insurance company are commissioned salespeople. They may not offer the most competitive policies. Independent agents or brokers represent several insurance companies and, therefore, may have a wider variety of policies to meet a company’s insurance needs.

Here are some questions to ask when interviewing an insurance agent or broker:

• How long have you been in business?
• Which insurers specialize in covering this type of business?
• Which insurance companies do you represent?
• Who are your top clients?
• With which insurance carrier do you do the most business?
• How much influence do you have to resolve a tough claim or coverage dispute?
• How are you compensated?
• Do you have errors and omissions coverage?
• What industry segments do you serve?

Agents or brokers who are unwilling to answer or be bothered by these questions should be avoided. If the agent or broker answers these questions satisfactorily, the potential insurance company has passed the first requirement to getting the business. The next step is to ask for more information about the company:

• What is its reputation for paying claims?
• Can it provide loss prevention services?
• Can it offer multiple-year policies?
• Has the company been in and out of the market or is it a long-term player?
• What is its financial rating?

Several companies rate insurance companies. Examples include the following:

• A.M. Best (http://www.ambest.com)
• Standard & Poor's (http://www.standardandpoors.com)
• Moody's (http://www.moodys.com)
• Duff & Phelps (http://www.duffllc.com)
• Weiss (http://www.weissratings.com).

Insurance companies are rated on their financial ability to pay claims and benefits. It’s always a good idea to check the rating of an insurance company before purchasing insurance policies.