The very first time that I work with a potential client, I'll often ask them if they think they're getting good value for their business insurance dollar. Most of the time, the response is a chuckle followed by something along the line of "How in the world should I know if I’m paying too much for my insurance?"

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Ottawa - June 25, 2013 - The very first time that I work with a potential client, I'll often ask them if they think they're getting good value for their business insurance dollar. Most of the time, the response is a chuckle followed by something along the line of "How in the world should I know if I’m paying too much for my insurance?" But there is a very simple way to know if you’re paying fair market price but it has nothing to do with you; it's all about your broker.

Your broker should be working on your behalf on a number of fronts. Part of their job is that of a risk manager, making suggestions on how to mitigate or eliminate the risks that your company faces every day. Another part of their job is to ensure that not only do you have the correct insurance products protecting your operation, but also that your annual premium is competitive. Most brokers call that last part "shopping around" when they compare the cost of your insurance products with a number of different insurance companies.

Shopping around is great but there are some important things to watch out for. It’s important to compare “apples-to-apples” insurance coverage when you’re faced with a choice of insurers. Your broker should ensure that not only are the limits of insurance identical to each other, but also that the deductibles are the same and also that each of the policies will respond the same way in case of a loss. Only when all of the insurance players line up accordingly, can you really compare “apples-to-apples”. Once your broker has the comparisons available, there’s one more thing that you should do – ask to see the results.

Often, a broker may tell you that they shopped around but that is where the conversation ends. Instead, the broker should provide you with a spreadsheet which lists the insurance companies that were approached along with their responses, including their quoted premium. When you have a document in your hands that lays out for you exactly the coverages and premium quoted from seven different insurers, that’s a powerful tool that will help you decide if in fact you are getting “good value” relative to the insurance market place.

And one final thought on the matter; if your broker isn’t willing to show you the results of their shopping, ask them why. And if you’re not satisfied with their answer, contact me and I’ll do the shopping for you…and share with you all of the results.