Never Shop Your Commercial Insurance


Are you an insurance “shopper”?  One of the worst things you can do is to behave as the typical insurance buyer.  This is the buyer that makes multiple copies of their insurance policies and invites multiple agents to bring quotes from multiple insurance companies, asking that they quote “what I have now; Apples to Apples.”
Assuming that you have three different agents that go to 7 different insurance carriers, there may be 21 insurance carriers “bidding” for an account.  That sounds like a good idea because it creates competition and that will in turn drive the price down.  That works with a lot of things, but commercial insurance is not one of them.  It is actually the exact opposite of what you should be doing.
In the world of commercial insurance there are agents, wholesalers and carriers.  The agent gathers the information about the account.  They then present it to carriers that they can go direct to or wholesalers who will then send it directly to the carriers.  Both wholesalers and carriers log your account into their systems.  The first agent that gets to the wholesaler and/or carrier will reserve the account and “block” all other people from obtaining a quote from that place.  Wholesalers and carriers have very long memories.  They know how many times they have seen your account and what has transpired over time.
When carriers perceive that the insurance buyer is a constant “shopper” they may not want to waste their time to quote it.  Additionally, if they get the same account submitted to them from several different agents the carriers and wholesalers again will look at the insurance buyer as a “shopper” and not able to decide on whom they want to use as an agent.  When a carrier gets multiple submissions from multiple agents it is rare that the information is all the same.  When carriers get different information from different agents it starts to muddy the waters.  This is a very easy way to get underwriters upset and that could very easily translate to your inability to obtain the coverage and pricing that you want.
All of this, as it turns out, is usually a waste of time because the insurance buyer never intended to leave its long time agent to begin with, but just wanted to keep that agent “honest.”  If you feel the need to keep your agent “honest” then you really do not trust the agent and that is not the right agent for you.  As an insurance buyer you should have 100% confidence that your agent will do the right thing by you when it comes to price and coverage.  This type of wasteful “quote contest” will always hurt the insurance buyer because at some point they will need one of these companies due to a non-renewal or cancellation and underwriters do not forget when they have been used.  As you can easily see, shopping your insurance with many agents is not only a bad idea it will cost you more on your insurance not less.  Having the right agent and strategy is the only way to ensure that you will not be labeled a “shopper” by your insurance carriers.
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