The Inside Scoop on Insurance Renewals

Insurance is really a unique industry - it’s one of the few industries that hasn’t been around for all of human history, that isn’t inherently foundational to human survival and existence, and yet it has cemented itself as an industry that we cannot function without.?

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Most folks first interaction with insurance is when their parents start telling them about Auto insurance when they get their drivers license and their first car. And from that moment on, most people hate buying insurance.?

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It’s expensive.

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You hope that you never have to call them (I swear I’m a good driver Mom. Why do i need insurance?)

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I remember when I bought auto insurance the first time. I was insuring myself and a 2005 Toyota Sienna… the minivan.

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It wasn’t exactly the coolest car in town, but as a high school kid near a lake, and during sports seasons, I quickly learned how valuable a minivan could make me. I could put a million different things in the back, or I could haul all of my friends to and from events, and gas mileage was way better than the guy doing 95 down the freeway at 11pm.

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But no matter how lousy I thought that car was - my insurance was still way more than either of my sisters. It was so unfair.

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That’s when I got a crash course in insurance underwriting and risk assessments. A minivan full of high school kids - definitely way more likely for a lawsuit than a commuter car that barely gets driven.

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A 18 year old kid who’d had his drivers license for a little over a year and a half… way more likely to get in an accident than someone who’d been driving for years!

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It was a tough lesson - and it made me work a few more hours a week just to afford to drive, but it’s one I won’t ever forget.

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Now, I tell you that story because most business owners have that same shock every year when they see their insurance renewal for their business. It’s almost never as good as you wish it could be.

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Didn’t have any claims last year? Great, doesn’t matter.?

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Did you actually use our product and file a claim to keep you business running? Well - we have to charge you more this year.

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Unfortunately, insurance is a fairly predicable industry that many people forget how to predict. Let me walk you through what exactly we see on the other side of the table, as your broker, during your insurance renewal.

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Time to look at the man behind the curtain.

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120-145 days out

Your broker will sit and craft a plan of attack for your renewal. This process should include you! Whether you have a quick phone call, or actually set up a meeting in which you can lay out issues you’ve had, solutions you need, and what your priorities are for the coming year.?

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Your brokers plan of attack should include Which insurance carriers to go to, what target premium is, when do we want to give you a proposal, will it need to be financed or billed over time, etc.?

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At the same time, your broker is weighing his other clients renewals, so they are probably sitting down and looking at their calendar (maybe a little stressed) and trying to make sure that they set deadlines to meet for each clients renewal

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120 days out

About 4 months before your renewal date, its time to start gathering information. The info can vary based on types of insurance, but it will always include applications, a few key underwriting questions, and loss runs.

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90 days out

we send all your information to the different underwriters that we are wanting to get proposals from. Some years, we may go to a handful of markets, other years, it may just be your current insurance carrier because they have been so effective for you.?

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(Pro Tip: make sure to ask your broker what they are planning to do with your submission. If they have a plan, make sure they let you give input on it. If they don’t - you’ll be able to tell right away.)

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60-75 days out.

This is typically when the client starts asking questions. Do you have quotes for me? How long until we can get this thing done??

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I’ve probably already gone back and forth with the various underwriters about your business a few times, potentially even meeting with them via phone or Zoom to discuss the intricacies wherever possible.?

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That calendar I mentioned we set up about 3 and a half months out? yeah, that’s probably been revised 4 or 5 times at this point because everything seems to be constantly changing. Clients are booking vacations, carriers are swamped with other items to work on, etc.?

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60 days out marks the final stretch. Following up with underwriters and seeing if they have any final questions, asking for premium indications so that we can reassure the client with SOMETHING, or even just an acknowledgement that they want to write the business and are working hard to come up with a valuable proposal.

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30 days out.

In an ideal world, we would have quotes 30 to 45 days out from your renewal date. This current market is not ideal so it doesn’t happen as often, but it is always a goal.?

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14-21 days out.

This is when we need to be meeting with you to discuss our proposal. Whether it is the exact same as last year, or we are making changes for price, coverage or even relationship, this needs to be discussed so that you can feel comfortable in your choice of insurance programs.

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14 days out.

Any final negotiations happen if you aren’t happy. Perhaps the underwriter at your current carrier was way more expensive than another, but you really like them so you want them to adjust their pricing so you can justify staying with them. Getting those final adjustments done and taken care of should be a simple task if you set targets/goals/priorities with your broker at the beginning of this process.?

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7-14 days out.

The sooner you are happy with you options and can sign on the dotted line, the better. Once we issue a bind order we can get to work on certificates of insurance for everyone who needs one, auto ID cards for each vehicle, and honestly, just being happy we are done with insurance for the time being.

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This timeline is built to be reflective of the properly executed timeline for an insurance renewal, and that isn’t always possible. In a perfect system, you could be done way more than a week before your renewal date. Other times, there are problems that slow it down.

However what I hope this can do is begin to show you that buying insurance to cover your business is a lot more than getting an auto quote online from GEICO, AAA, and Allstate when you are 18 and driving Mom’s old minivan.

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Hopefully this helps give you an idea of what exactly is going on while you are waiting for a quote!?

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Hate this process even more that you see it all written out on paper? Check out this (much shorter) article on 3 Ways to Improve Your Insurance Renewal Process.