Why Should I Use an Insurance Broker? – Part 1

Jul 16, 2014
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Why Should I Use an Insurance Broker? – Part 1
In our previous post, we asked this question:
How often should you mow the lawn, to keep your business’s property looking fresh & well-kept?
Answer: 
How often you mow is going to depend on how fast the lawn grows! It’s recommended to keep your grass at around 3 inches high, cutting only a third of the grass height each time you mow. That could mean mowing every week, every two weeks, or less—it all depends on the surrounding factors like rain, sun, and soil.
Did you know the answer?
Now for this post’s question!
In Canada, what are the four avenues available to consumers to purchase insurance?
Check back for the answer in our next post!
You’ve heard us say it before… your broker works for you! But what does that really mean? We say it time and time again, but we also understand that without some context, folks new to the experience of insurance brokerage might not fully comprehend the value of having another party helping you to make sense of the insurance industry.
Insurance can be confusing, and many companies post plenty of rhetoric about how quick and simple it all is and how little you really need to know.  Do you really have the time, energy or interest to become enough of an insurance expert  to make an informed decision?  It’s a busy world out there, which is why we have insurance brokers—they wade through the tough stuff, so you have more time for yourself and your family. And if there’s one thing most of us seem to want, it’s more time!
Let’s take a walk through some of the reasons why using an insurance broker—like the fine people of Staebler Insurance, hint hint!—is beneficial for you, your finances, and your peace of mind!
1) Whose side is an Insurance Broker on?
When you deal directly with an insurance company, you’re speaking and dealing with employees of that insurance company. Those agents, while they may be excellent at their jobs, are obligated to represent the best interests of their employers at all times. State Farm, Belair, the Co-Operators… there agents are “on the side” of their employer.
When you work with an insurance broker, the broker is actually employed by you to represent your best interests. Brokers are professionally governed to ensure that they advocate for the best interests of their clients above all others—yes, even above themselves.
If a plan is best for you but not necessarily the best for the broker?  Doesn’t matter. They’re employed to be on your side, and that’s the whole point. An insurance broker is on your side from start to finish. If they weren’t, they’d be out of a job pretty quickly!
2) Isn’t there a conflict of interest here?
Here’s how it breaks down: Your insurance broker services are paid for by the insurance company as a percentage of premiums—acting as commission—on your policy. Anytime someone receives “commission” on a product or service, of course you’re going to wonder if this creates a conflict of interest!
How many times have you gone into a store to be told that a product you’re looking at that’s higher priced is “the best” or “much better value than the low end product”, only to discover that the sales clerk is getting commission off of every sale? The more you pay, the more a commissioned employee earns. It’s as simple as that.
Actually, when it comes to insurance brokering, it’s not quite that simple. As brokers for your insurance, we work hard to gain and keep your trust. We need to be one hundred percent trustworthy and competent if we’re going to have a relationship of trust and confidence with you.
Any broker worth their salt knows that insurance is a competitive business, so if we want to keep it for the long haul—and perhaps even be recommended by you to your family and friends—we need to continue bringing in the best value for your dollar. We need to listen and understand your needs, and fight for the best options on your behalf, every single time.
3) Okay, but will the broker help me with my claim?
This is where the task gets daunting as an individual. Every year in Canada, there are thousands of insurance claims submitted to insurance companies. In a perfect world, the insurance company would step right up to the plate and do their best possible job of settling your claim, every time. You wouldn’t find yourself scratching your head over muddled “grey areas” or screaming at the phone when you learn some of the coverage wordings are, unfortunately, open to interpretation.
Does this sound like an experience you’ve had before? It’s a lot to take in, and if you end up calling an insurance company about coverage or bizarre wording, you may find yourself on the losing end of an argument. It’s hard to argue compellingly if you’re not entirely familiar with the underwriting intent! And that’s no fault of your own, either.
Call us crazy, but as insurance brokers, we put more time and energy than you can imagine into drilling the details of coverage wordings into our brains for all the insurance companies we work with. In fact, sometimes it seems like we’re forever debating with adjusters or underwriters, but we won’t hesitate to escalate a disputed claim to a higher level of authority.
And guess what? We not only enter those debates willingly, but we often win them! That’s our job—that’s what we’re here for, to fight for you.
There are plenty of other reasons to use an insurance broker, and we’ll look at a few more next time. Until then, remember—we’re on your side!

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