9 Steps for Renewing Your Insurance Program in a Transitioning Market
Commercial insurance pricing in many regions and across most major product lines has been increasing in recent months. So it’s important for insurance buyers to differentiate their risks and start the renewal process early.
Despite pricing pressure and increased underwriting scrutiny, insurance capacity generally remains sufficient — particularly for organizations that differentiate their risks. Working with your broker on the following steps can help ensure renewals proceed as smoothly as possible:
1. Start early.
Begin to strategize and collate renewal submission information at least three months before renewal.
2. Be transparent.
Expect insurers to require more detailed underwriting information, and establish the most effective way to present it. Where possible, identify and use marketing differentiators, such as videos profiling risk control, operations, supply chain management, and other salient features of your risk management program.
3. Identify your risk appetite.
Determine your organization’s appetite for retentions, coinsurance, or exclusionary language, and understand what will constitute an acceptable renewal program.
4. Organize a high-quality submission.
Develop a high-quality underwriting submission tailored to industry trends and challenges. Your risk will be differentiated based on the underwriting submission and on the quality and nature of the conversations you have with (re)insurers. This will allow underwriters to provide the best outcome they can.
5. Market your program effectively.
The strength and size of a corporate relationship may play a role in the underwriting process. Marketing multiple program areas to insurers can help secure visibility and senior management involvement.
6. Involve your C-Suite.
Including senior management in a presentation to insurers demonstrates that your company takes the renewal process seriously, and enables underwriters to ask them questions directly. It also builds trust, which will be crucial later in the process when trying to get markets to release terms early enough for them to be carefully evaluated, and for the broker to obtain terms from alternative primary markets and/or excess layer markets.
7. Don’t just focus on cost.
Although budgets may well be challenged by increasing premiums, it’s important not to lose sight of the big picture: Saving a relatively modest amount now by reducing coverage may have a negative financial impact should a claim occur.
8. Establish claims and service protocols.
To reduce the risk of a claim becoming adversarial, establish ”best practice” protocols that articulate the responsibilities and expectations for both the insured and the insurer. Similarly, agreeing on service protocols provides clarity about the expectation levels for response times, which will help to reduce potential conflicts.
9. Stick to agreed milestones.
Allow time before renewal to put capacity in place and agree on policy wordings. If a strict timeline is not adhered to, placements can lose momentum while insurers concentrate on other issues.
Despite the transitioning market conditions, competition among insurers remains strong, and capacity plentiful. Working closely with your broker well in advance of renewal will help you secure favorable renewal terms and conditions and forge a partnership built on trust.