Selecting a commercial insurance broker can have a significant impact on the bottom line, but the process can be difficult to manage. There are three ways clients typically choose their broker:Broker Interview
Interviewing your potential broker is highly effective, as it allows you to dig deeper than the written documents of an RFP. You can ask detailed questions to find out more about your prospective broker’s level of creativity and personality type. These factors can help determine if a broker is a good fit for your company.RFP (Request for Proposal)
Many companies use this method to pick a broker, even though it is a very formal, time consuming process. Generally, a proposal team generates the RFP, which can run dozens to hundreds of pages long. Many times RFPs responses sound the same in writing so it becomes difficult to decipher which is the best response. If you use the RFP approach we recommend following the written responses with oral interviews so that you can really understand the differences between the brokers.Multi-broker Bid Approach
With this approach, clients ask prospective brokers to obtain quotes from various insurance companies, essentially resulting in a bidding war. Often, the client still receives the best quote from their existing broker with their existing carrier. If this method is chosen, it is important to assign specific brokers to obtain quotes from specific carriers to give them the ability to play to their strengths.
Overall, we recommend interviewing prospective brokers to get the best results. While it may take more effort in coordinating the interviews the time spent will be efficient and allow you to select a broker based on their overall qualities and cultural fit.
To make the best choice possible, Barney & Barney recommends that a company has a complete understanding of the process when seeking to evaluate or change brokers. You can download a more detailed white paper outlining the dynamics in today’s commercial insurance market, the three primary methods of engaging a commercial broker, the process of changing brokers, and the virtues of working with the broker you have chosen.