business insurance

Top 5 Insurance Tips for CFOs

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When selecting an insurance brokerage and structuring a risk management plan, Chief Financial Officers (CFO) need a clear perspective on how and where that plan aligns with the business's short and long-term goals. Here are the top 5 insurance tips for CFOs to help select the right insurance brokerage and coverage:

Credit Quality: A.M. Best rates insurance companies on their financial strength. You should not choose an insurer with less than a A+++ or A+ rating. Insurers should have a record of prompt claims settlements and payments.

Risk Tolerance: All risk not financed, avoided or reduced is thereby retained by your business either actively or passively. Your risk manager should be making you aware of both insurance and non-insurance ways to mitigate your risk. This could be as simple as coverage placement, machine guarding or contract language. If you don't know, ask! A large uncovered claim could be detrimental to the balance sheet.

Reliability: Are the presented insurers and the brokers credible? Do they deliver even the small promises they make? Do you feel like you are treated the same as a multi-billion dollar company would be? If not, you should be thinking of change.

Communications: Do you have clear and reliable communication channels with your brokerage team? Do you know who to contact with a general question, a claim or a certificate request? Is your broker communicating information that is relative to your business? Were all of your concerns adequately addressed, or were they glossed over during the presentation?

Knowledge: Insurance lingo, coverage, case studies, bench-marking, and procedures can all be looked up, but is your broker taking the time to understand your business? Does it seem like they are asking a lot of questions? Does your broker ask you uncomfortable questions, or are they skirting around the issues to get a quick sale? A reputable insurance brokerage will ask a lot up-front in order to gain a better understanding of where your business is and where it is going.

If you have not experienced all of the above, consider partnering with The Plexus Groupe. We value long-term relationships and we know that starts with you.

Matt Wilkens, ARM, can be reached at mwilkens@plexusgroupe.com or by calling 847-307-6157.

Commercial Auto Insurance Rates Snapshot: What Companies Should Know

commercial auto insurance Have a fleet of commercial vehicles?

You’ve probably noticed your insurance is costing you a little more. According to an industry survey conducted by The Council of Insurance Agents and Brokers, commercial auto insurance rates rose 3.6 percent in the first quarter of 2016. By contrast, overall rates in the commercial property and casualty sector fell 3.7 percent on average in the first quarter, per CIAB data.

The commercial auto insurance sector has had a series of tough years. Via Business Insurance, the industry suffered a collective underwriting loss last year, the fifth straight year it hasn’t shown a profit. One reason the industry has struggled has been a “recent extended period of heightened claims severity, particularly relating to bodily injury claims,” said James Auden, the managing director of Fitch Ratings, per Business Insurance.

With an increase in claims can come a worse loss experience — meaning lower profits or even losses — for the insurer. It’s only logical, then, that the result would be a commercial auto insurance rate hike.

And when presented with a commercial auto rate hike, it helps to have a diligent, experienced insurance broker on your side — a client advocate who can work toward a positive resolution.

In a climate where auto rates are rising and gas prices have only recently begun to rise, there is ample reason for companies to be keeping an eye on how they can manage their commercial auto rates. Certainly, hiring skilled drivers and training them well is essential. But having an insurance broker focused on strategic risk mitigation solutions is vital, too.

The Plexus Groupe possesses a wealth of property and casualty expertise. We tailor risk management solutions to your business, and we take a client-focused approach to all we do. For more information, contact a Plexus property and casualty client executive at 847-307-6100, or contact us via the Web.

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