What Is an Insurance Broker?
An insurance broker is an independent advisor who helps businesses with their business insurance, including property insurance, cyber insurance, and business liability insurance. The insurance broker works solely on behalf of the client and must ensure that the business has the correct and necessary insurance, tailored to the company’s desires and needs.
What Does an Insurance Broker Do?
The insurance broker is overall responsible for everything related to business’s business insurance.
This means everything from the initial work of getting to know the company and finding the best possible business insurance based on the company’s individual needs, to handling the ongoing administrative work related to the company’s insurance and putting the solution out to tender again each time an agreement period for the business insurance ends, ensuring that the solution is always up to date and at the right price.
How does a collaboration with an insurance broker start?
At the very beginning of the collaboration, the insurance broker will ask the company’s representatives to sign an insurance broker power of attorney, which gives the broker permission to review the company’s current insurance solution and seek insight into the company’s data. After this, the insurance broker can delve deeper into the company.
Once the broker has gained the necessary overview, the insurance solution will be put out to tender with several insurance companies, who will be invited to submit their offers for a business insurance for the company.
The insurance broker will then review and analyze the received bids, negotiate with the companies, and finally present the best offers to the company along with their recommendation. The definition of the best offer is the solutions that provide the best terms, coverages, and price based on the company’s specific wishes, requirements, and needs.
Why Use an Insurance Broker?
As described earlier, managing a company’s business insurance is a time-consuming task.
You need to find the right insurance company, ensure that all necessary insurance policies and coverages are included in the insurance solution, handle administrative work, and renegotiate the agreement each time the contract period expires.
In addition, developments in areas such as technology and climate will create changes that could mean altered needs to insure against future risks for both large international corporations and smaller local businesses. This places demands on both companies and the insurance companies in the market with regard to prevention and securing significant losses from threats such as cybercrime and climate change.
These needs and requirements create a highly competitive insurance market with high costs and often opaque insurance terms. Therefore, it can be advantageous for many to use an insurance broker who can ensure that the company has the right and necessary insurance terms and coverages – both now and in the future.
Can I manage without an insurance broker?
Only the individual company can assess this. Our experience is that very few companies, or perhaps even none, who have in-depth knowledge of the insurance industry, including legislation, EU regulations, the individual requirements of insurance companies, etc. This can leas to a very uncertain situation for the company if something unexpected happens, and the company needs coverage from an insurance it has not taken out, or if there are insurance requirements that have not been met, so the insurance company will not cover a loss. In the worst case, an accident or damage could become so costly that the company may not be able to continue operating.
Therefore, it is worth considering whether you are well-equipped to handle your company’s insurance on your own, or if you could benefit from help from an insurance broker.
If you have questions about business insurance or would like to discuss your company’s insurance solution, please contact us here.
We Often Get These Questions
An insurance broker provides independent advice on business insurance and ensures that the company has the correct and necessary insurances.
An assurer is employed by the insurance company. An insurance broker is independent of the insurance companies and works solely in the customer’s best interest.
The fee for an insurance broker depends, among other things, on the level of advice and the complexity of the insurance solution.
The insurance broker ensures that the company has the correct coverages and can assist with all the work related to the company’s insurance solution.