CONSULTATIVE INSURANCE BROKER REDUCE FINANCIAL LEAKAGE | IMPROVE BOTTOM LINE

PAY ATTENTION IF YOU WANT TO LOWER EXPENSES, INCREASE THE BOTTOM LINE AND GROW YOUR VALUATION

4 WAYS TO BUY INSURANCE:

RELATIONSHIPS SPREADSHEET BROKER SELECTION BUSINESS KPIs

METHOD #1 PEOPLE LIKE TO BUY FROM PEOPLE THEY LIKE!

RELATIONSHIPS

TOP 10 CARRIERS WRITE 61% OF PREMIUM WRITTEN BY THE TOP 50 CARRIERS

61%39%

TOP 10 GLOBAL REINSURERS WRITE 68% OF PREMIUM WRITTEN BY TOP 50

68%

32%

COME ON, HOW LARGE COULD THE PREMIUM DIFFERENCE BE? WHY NOT BUY FROM A …

CLUB MEMBER

GOLF BUDDY

FAMILY MEMBER

QUESTION #1: DOES YOUR PERSONAL RELATIONSHIP PRODUCE THE BEST RESULTS FOR YOUR BUSINESS?

METHOD #2 BID IT OUT!

SPREADSHEET

DEVELOP BID SPECS COMPARE APPLES TO APPLES ASSIGN MARKETS OBTAIN QUOTES SPREADSHEET SELECT LOW PRICED CARRIER

13

TOP 10 REVIEW:

61%39%

68%

32%

CARRIERS REINSURERS

LOSSES

LOSS ADJUSTMENT

EXPENSE

EXPENSE

PROFITS

LOSSES

LOSS ADJUSTMENT

EXPENSE

PROFITS

EXPENSE

NEGOTIATION AREA

SAVINGS? NOT REALLY, UNLESS YOUR AGENT HAS BEEN SKATING AND NOT PAYING ATTENTION

OR A NEW PLAYER DROPS INTO THE MARKETPLACE

QUESTION #2: DO YOU REALLY WANT THE LOW COST CARRIER TO DECIDE WHO’LL BE YOUR BROKER?

METHOD #3 EVALUATE AND DECIDE

BROKER SELECTION

CARRIER SELECTION ABILITY TO NEGOTIATE KNOWLEDGE OF YOUR INDUSTRY COVERAGE REVIEW QUICK RETURN OF CALLS CONTRACT REVIEWS CERTIFICATES OF INSURANCE AUTO I.D. CARDS TIMELY RENEWALS POLICY ISSUANCE TEAM OF WELL DRESSED PEOPLE

BEST IN SHOW

QUESTION #3: AREN’T THESE “ME TOO” SERVICES

AND SHOULDN’T THEY BE THE PRICE OF ADMISSION?

METHOD #4 BUSINESS ANALYSIS LIKE ANY OTHER DECISION

BUSINESS KYI’s

IT’S ABOUT THE INCOME STATEMENT! HOW WILL THE DECISION INCREASE YOUR REVENUE, DECREASE YOUR EXPENSE AND GROW YOUR BOTTOM LINE?

LOSSES INDIRECT LOSSES ADMINISTRATIVE RISK FINANCING

LOSSES

LOSS ADJUSTMENT

EXPENSE

EXPENSE

PROFITS

LOSSES

LOSS ADJUSTMENT

EXPENSE

PROFITS

EXPENSE

AREA OF IMPACT

DIRECT LOSS COSTS: DEDUCTIBLE EXPENSE SELF INSURED RETENTION ALLOCATED LOSS ADJUSTMENT UNINSURED LOSSES

LOSSES INDIRECT LOSSES ADMINISTRATIVE RISK FINANCING

DIRECT LOSS COSTS ARE VISIBLE ABOVE THE WATER

MEDICAL COSTS INDEMNITY PAYMENTS

LOSS ADJUSTMENT EXPENSE

THE REALLY SCARY THREATS TO YOUR BOTTOM LINE ARE INDIRECT LOSS COSTS LURKING BELOW THE SURFACE

WORKER LOST TIME JOB ACCOMMODATIONS COWORKER & SUPERVISOR LOST PRODUCTIVITY TRAINING COSTS OVERTIME COSTS SCHEDULE DELAYS FOCUS AWAY FROM PROFITS TIME SPENT WITH LEGAL OSHA INVESTIGATION COMPANY REPUTATION

OSHA: RATIO OF INDIRECT TO DIRECT COSTS

0

1

2

3

4

5

$0 - 2,999 $3,000 - 4,999 $5,000 - 9,999 $10,000 +

1.11.21.6

4.5

HOW CAN A BROKER HELP?

CLAIMS RESOURCES: CARRIER OVERSIGHT HANDLING AND RESERVES BENCHMARKING TRAINING PROGRAMS RETURN TO WORK MOD VERIFICATION PROPERTY LOSS SUPPORT COVERAGE ASSIST

LOSS CONTROL RESOURCES: ASSIST WITH AVOIDANCE, THROUGH PREVENTION OR RISK TRANSFER, AND LOSS REDUCTION

LOSSES INDIRECT LOSSES ADMINISTRATIVE RISK FINANCING

WHERE CAN A BROKER ASSIST?

ADMINISTRATIVE EXPENSE: HUMAN RESOURCES SAFETY SERVICE ACCOUNTING CLAIMS ADMINISTRATION CONTRACT REVIEWS REGULATORY COMPLIANCE SPECIAL PROJECTS

LOSSES INDIRECT LOSSES ADMINISTRATIVE RISK FINANCING

RISK FINANCING: PREMIUM TAXES DIVIDENDS RETRO ADJUSTMENTS BROKERAGE FEES

LOSS COSTS INDIRECT LOSS COSTS

ADMINISTRATION EXPENSE RISK FINANCING

BOTTOM LINE

RELATIONSHIPS SPREADSHEET BROKER SELECTION BUSINESS KPIs

QUESTION #4: YOUR DECISION?

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