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We Think of Insurance as a Promise

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Many people look at insurance as a commodity, like buying car or a piece of furniture.  Consequently, they become caught up in searching for the lowest price for the “product of insurance.”  Insurance is less of a commodity, and more of a promise or service.

Promise vs. Product

Insurance is a promise from the insurer to cover your claim or loss per the terms of the policy.  What many people fail to understand is that policies or “promises” differ from company to company. If you never have a claim, then you do not know if the insurer will live up to the promise you think they have made.  However, if you do have a claim you want the promises kept.

That is where we come in.  As an agent, we help you understand the promises made, and work with you to make sure the insurer fulfills all promises.  We can also help you design a policy that fits your needs.

Here Are Few Things To Remember About Insurance Promises

  • Getting the right coverage is not the insurer’s responsibility – it is yours. You need to determine what limits, deductibles, and coverage you will need to cover your risk.  As an agent, we can help you through that process.
  • You may need special or unique coverage like flood, employment liability, or umbrella coverage. We are here to help you evaluate your risk.
  • Insurance companies differ. We can show you how insurers differ in regards to product and services.

 

Why Low Price and High Value Can Be a Contraction in Terms

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Shoppers are always looking for that next big sale or deal. When it comes to purchasing a 46” HDTV, it is easy to identify all the features you want, and then shop for the best price.  In fact, many retailers might even negotiate with you to get your business. When selecting your insurance, you cannot think the same way.  Why?

  • Insurance can never go on sale, it is highly regulated.
  • Consumers rarely have complete information about various insurance products.
  • Consumers may believe that “popular” or advertised products are high in quality.

Let me make it clear that high priced insurance does not always equate to a better value.  However, if you purchase the low-priced insurance policy are you satisfied that all the coverage terms are consistent with a higher priced policy?  A better way to look at this is to consider the value of what you are buying.  Here are some of the value added advantages you will find in insurance if you do a little searching.

What makes up a high value insurance program?

  • An insurance policy that will respond to your risks when a loss occurs.
  • The extra services offered by the insurer at no cost to you.
  • The knowledge and expertise of the agent. The agent is your key to a high value advantage. The agent is the one who helps you identity your risks and designs a policy specifically for you.  The agent will be there to help you manage through a claim and to educate you.
  • Your agent increases your insurance value by helping you understand why the premiums are different.

Value is more than price

There are also non-price variables that every insurance purchaser should consider.

  • The agent’s experience in your industry. Do you want an agent who primarily only insures homes, to insure your restaurant?  These risks are different and should be treated as such.
  • Insurance companies have customer satisfaction ratings for claims, premium processing, and other services. Do you want to use an insurer with a below average claims handling rating?

In conclusion, only an experienced agent can help you understand and define the true value of your insurance purchase.

Cyber Liability; The Risk That Evolves Daily

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How Cyber Liability threatens your business every day

Did you know that an average business has a greater chance of having a cyber breach than it does of having a fire? It is true, and your business insurance policy most likely will not cover cyber liability losses.

Technology has enabled the common criminal to get into the world of cyber crime. Small businesses are a prime target, as most small businesses have little to no protection. Criminals can actually purchase programs that can be set up to hack dozens of businesses at the same time. It is important that your business has the right business insurance, including cyber liability insurance. Here are a few of the evolving cyber threats.

Malware hacks

These are programs that can be attached to an email or web site. The malware then can target specific systems.

Example–A small retail shop owner opened an email with a malware attached. The hack program then found 1,500 credit card numbers of the shop’s customers. The shop did not know about the hack until customers called about the fraudulent charges. The shop owner incurred over $75,000 in notification and payment expenses.

Social Hackers

This scam involves someone posing as a trusted bank or other advisor. The criminal then relies on the business owner or manager believing the call is legitimate and divulging privileged information.

Example–A CFO received a call from a hacker (acting as a bank official) requesting verification of account information. Through the process, the hacker obtained privileged information. They then used this information together with other data to make withdrawals from company accounts.

Key Business Insurance Coverage Offers Real Solutions

  • Cyber liability
  • Data restoration coverage
  • Business income or loss income
  • Legal notification coverage and expense

 

Three Things Every Agent Should Be Doing

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Businesswoman Writing on White Board and Businessman at Table

In case you have not figured it out, I am on a mission to change the way agents/brokers and their clients interact with each other. There are three things that every agent should be doing with their clients; educate, educate, educate. Ok I know what you are thinking. Just like real-estate, it is location, location, and location. But not so fast.

Here Is What I Mean By Educate

Educate Your Clients About Their Risk

The very first thing every agent needs to do is help their clients understand what their risks are. Not just simply fire, wind, and auto hazards, but rather the client’s complete risks.  These risks can include liability assumed in a contract, cyber risk, employment liability, and more. This involves truly understanding the client’s business and how to create and deliver real solutions; some of which may not include insurance.

Educate Your Clients About Insurance

Every agent needs to be providing information to their clients on how insurance works, and the pros and cons of the insurance their clients are considering. Do your clients fully understand all the terms, conditions, and exclusions of their insurance?

Educate Your Clients About The Market

It is very important that your clients understand how the insurance markets work, including market trends and market volatility. The swings in market pricing can actually provide opportunities for our clients. As prices go up, why not increase the deductible, thus keeping premiums level?

It should always be the goal of every agent to help your clients understand the value you bring to the relationship.

Five Things to Do Before You Start Your New Business

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The latest news from the Small Business Administration is that only 60% of new businesses survive at least 2 years. Of that 60%, only 44% survive another two years. It is a fact that more small businesses fail then succeed. The two main reasons for failure are lack of planning and funding. While we can’t help with the funding part, we can offer some ideas about new business planning.

We found at least five things entrepreneurs should consider as part of their development process. We understand there are more, but this is a good start.

  1. Understand the risks and legal issues – It is important to any new start up to understand all the legal and regulatory statutes and laws surrounding their business. Hire a good attorney to help you; it will be worth the expense. Hire a professional insurance agent to help you understand what your risks are, how to manage the risks, and how to protect yourself from the risks.
  1. Start with a good name – Your name needs to tell the story of what your firm does. For example, if you are starting a bakery, the name “Smith Brothers” fails to tell the public what you do. Also, depending on your market, it is probably not a good idea to use a foreign language as part of your name. Keep your name simple but innovative.
  1. Develop a marketing plan
    1. Who is your target market?
    2. What is the current competition?
    3. How can you fill a need?
    4. What strategies do you need to undertake to tell your story?
    5. What are the costs of doing business?
  1. Develop a Web strategy– It doesn’t matter what business you are in, you must develop a web presence. This would include a web page, social media (Facebook & LinkedIn) and a blog. For some industries, Twitter and Pinterest are important as well.
  1. Seek out mentors and advisors– Whether your mentor provides pointers on business strategy, helps you bolster your networking efforts, or acts as a confidant, it is good to have someone on your team. Hire a competent attorney, insurance agent, accountant and payroll HR/firm

Insurance is not a product. It is a promise and a trusted relationship. Here at Reichley Insurance Agency, we are not going to sell you something you don’t need. We want to talk to you, determine your needs, and get you covered at the right price.

Good luck and call us with any questions so we can help you achieve your goals!