Every business should expect their commercial insurance agent to shop around for better insurance rates from another insurance company at least every three years as a matter of practice. Insurance agents are reluctant to submit business insurance occasions to new insurance companies every year for fear that the underwriters will get fatigued seeing the same insurance applications every year without writing any new business. But there are times when it is a good idea to shop around. Here are some of the triggers:

Claims Problems in the Past but Things Are Getting Better

If a company has had the unfortunate situation of claims problems in the last five years, this will have a negative impact on the rates and surcharges applied by your insurance company. But if you have implemented a loss control program and can demonstrate that your loss control program is working based on improvements in loss trends, a new insurance company may be more willing to remove surcharges or offer discounts based on your efforts to improve the claims frequency for your business. Also, if your insurance company is aware that you are searching for new quotes, the underwriter should work aggressively with you to secure the best rates available despite the prior losses.

Business Has Grown or Shrunk

If a business has changed its size significantly over the course of the year due to economic forces, it will have an impact on the insurance program. For example, if a business has acquired a number of new vehicles, that business may be eligible for a fleet discount commercial auto policy through different insurance company. Size also will have an impact on general liability rates and workers compensation rates. If a business has scaled back in the last year, that business may now be eligible for small business owner’s policy. Small business owner’s policies are usually significantly less expensive than commercial package insurance.

New Operations, Divisions, or Subsidiaries

If the business has entered into a new class by adding a new division, the entire business may now be eligible for insurance coverage through a different insurance company that is particularly anxious to write insurance for the new class of business. For example, if a home improvement center decides to add an installation service to their business offerings, the home improvement store including the installation service may be eligible for better rates through an insurance company anxious to write contractors but which may not have been willing to write retail risks alone.

Different insurance companies target different types of business operations. If your business has expanded into a new field, your current insurance company may be willing to write the insurance for your new operation, but may not offer the best rates because that insurance company really doesn’t like those types of risks. It is important that the insurance company you are with wants to write all of the divisions within your company and is willing to offer the best rates for all of your business classifications.

If you feel that you’re not getting the best rates or that it may be a good time to check the market, feel free to express that and ask your insurance agent to market your renewal aggressively. You should also know that most insurance companies in most states have some negotiating ability. Ask your insurance agent to negotiate your rates with your current insurance company. Once you have negotiated your commercial insurance renewal quote with your current insurance company and have at least three other quotes in hand, you can rest assured that you have secured the best coverage for your business at the best rates available.

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