Insurance one-stop shopping Featured

8:00pm EDT August 26, 2007

Insurance industry surveys have confirmed that consumers would like to purchase all the insurance they need from the same insurance agency/broker. With all the different types of insurance and carriers out there, this is much easier said than done.

Most firms specialize in either personal, commercial or employee benefits insurance. Commercial insurance providers are often excited to inform people they do not provide personal insurance coverage, says Jim Sim of Westland Insurance, as if they have graduated from the personal insurance industry.

If a firm does provide several types of coverage, it is often difficult to find any firm that has adequate staff and services, says Sim. There are more than 30,000 agencies that provide insurance; 90 percent provide personal lines insurance, such as homeowners and auto, and only 10 percent provide commercial insurance or employee benefits insurance.

Smart Business spoke with Sim about one-stop shopping for insurance and the benefits of one firm providing all types of coverage.

What should a consumer look for in an insurance firm?

While consumers would like a firm that provides many different types of insurance, they do not want a personal lines agency providing commercial insurance. Often, the problem for consumers is finding a firm that provides all types of coverage from numerous providers.

A consumer should ask a firm if it provides all lines of insurance and how many employees staff each department. Proper staffing is crucial to great service. You should also ask how the employees communicate among the team. You may end up with three different insurance companies, but you want one firm that communicates well with all the companies, among themselves and with you. This ensures everyone is on the same page and that you are receiving the best coverage possible.

Finally, you want to look for a competitive firm. Insurance is a competitive industry, and you want to make sure the firm is always offering the best coverage for a competitive price.

What types of insurance should a consumer make sure a firm provides?

The three main types are personal, commercial and employee benefits.

Personal insurance: This is a very common type of coverage and includes, but is not limited to, homeowners insurance, auto, umbrella, yachts and planes.

Commercial insurance: This type of insurance is common for business and property owners. It includes liability, auto, workers’ compensation, commercial property and umbrella insurance.

Employee benefits: This type of insurance is more specific for business owners. It includes group health, long-term disability, 401(k), etc.

What is the benefit of using one firm to provide all types of insurance?

If you can use the same firm for all types of insurance, it will know you and your account. The team with which you work will know where personal stops and business starts. Using a firm that provides all types of insurance provides coordinated insurance and coverage. This helps prevent gaps or overlaps in coverage. With a team that works together to make sure you have the correct insurance, one receives efficient and cost-effective coverage. Discounts may also be offered to consumers who purchase different types of coverage from the same insurance company or provider.

Why is it important for business owners to research insurance firms and look for good customer service?

As a business owner, you want to make sure all of your assets — personal and commercial — are properly covered, as you have so much time and money invested in these items. With a professional firm, a consumer will be able to consult a broker or insurance agent to answer any questions you may have. You do not want to have to call an 800 number to get service from numerous different firms in various places and time zones — most are out of town, state or even in another country. Rather, you want one contact team that can be reached at one number.

If you are using numerous providers from different insurance firms, is it difficult to switch to one firm?

No. The new firm should be able to review your needs and assist in the transfer, taking pressure off of you, the business owner. Once you have selected a firm, you want to make sure you meet with your team to conduct annual reviews to ensure new assets are not overlooked or forgotten. With a constant contact at an insurance firm, you can make a simple phone call or send an e-mail prior to each purchase to make sure you are always covered. With a single firm, a daunting task, such as selecting insurance providers, becomes simple.

JIM SIM is president of Westland Insurance Brokers. Reach him at (619) 584-6400 or jsim@westlandib.com.