What Is an Insurance Broker and Why You Need One

An insurance broker can assist you in protecting yourself, your business and your assets from a whole range of risks and will work on your behalf to get the best deal that suits your situation. 

Of course, you can purchase insurance directly with an insurer but utilising the services of a broker means you have access to an expert in risk management who can help you identify the risks you should insure and those you can manage in other ways. 

Brokers are also mostly independent, they do not work for insurance companies, so the professional advice they offer is free from commercial bias and is tailored to your needs. Where a broker does work on behalf of a particular insurer they are obliged to inform you of this. 

According to the National Insurance Brokers Association, brokers place almost half of all general insurance premiums in Australia – about $17 billion a year – and are typically involved in helping arrange commercial insurance. 

Brokers most commonly arrange business packages, commercial motor and professional indemnity insurance, life insurance and income protection cover. 

Insurance companies pay many insurance brokers a commission when a policy is purchased by one of their clients. Other brokers act on a fee-for-service basis, so ask your broker to explain their situation to you. 

Often consumers and businesses will make a decision to purchase insurance based purely on the lowest price and this strategy can backfire in the event of a claim if they find out they are not adequately covered, or even not covered at all for the loss that occurred.

One of the primary benefits of using an insurance broker is that you avoid being left in that situation, which could save you a lot of money in the long term.

• help you to assess and manage your risks, and provide independent advice on what insurance solutions are appropriate for your needs
• offer detailed knowledge of insurance markets, prices, terms and conditions to help you navigate the wide range of products available in the market
• act as your advocate in settlement of any claim that may be made by you under your insurance
• prepare a customised insurance and risk management program, where they design the policies, negotiate the terms with insurance companies and place the cover with the insurer. By including a risk management program, which puts some of the responsibility for risk prevention and loss minimisation on you or your business, you can reduce premium costs.

Insurance brokers are governed by a Code of Practice, which sets out minimum service standards that clients can expect from brokers. It also outlines how you can make a complaint or resolve a dispute regarding possible breaches of the Code. Basically, the code is designed to safeguard the self-regulation of the broking industry and give you confidence in utilising the services of an insurance broker. You can find out more at the website of the National Insurance Brokers Association. Insurance policies can be complex and full of industry jargon. While an insurance broker can help you understand many of the terms used in insurance, you can also use this handy reference guide. Contact Coast & Country Insurance today for a free initial discussion on your insurance needs.

General Advice Warning: The content of this article is general advice only and should not be acted upon without first consulting an industry specialist as it does not take into consideration your personal needs, objectives or financial circumstances.

The dynamic nature of the insurance sector can sometimes make it a challenge for businesses to remain updated. As governments adapt to changing socio-economic climates, regulations around insurance coverage, limits and compliance requirements can shift.

Finding and managing insurance can be time-consuming. With an insurance consultant by your side, you can redirect this time to other core business activities, confident in the knowledge that insurance matters are in capable hands.

• Comparison: A consultant can show how premiums differ between providers for the same coverage, ensuring value for money.
• Bundling Benefits: Combining multiple policies might lead to savings, a strategy often recommended by consultants.
• Favourable Rates: Long-term relationships with insurers often result in better negotiation power for consultants, translating to more favourable rates for businesses.

The claims process, while essential, can often be intricate and cumbersome. Each step is crucial and requires meticulous attention to detail to guarantee a fair settlement.

• Initiation: This is the beginning of the claims process. It involves notifying the insurer about the incident. An insurance consultant provides guidance on when and how to initiate a claim, ensuring all prerequisites are met.
• Documentation and Verification: This phase involves the accumulation and presentation of all evidence, reports and necessary documentation. The veracity of a claim often hinges on the quality and comprehensiveness of this evidence. An insurance consultant can aid businesses in collating everything required, ensuring that the claim’s legitimacy is irrefutable.
• Settlement: After all verifications, the settlement phase begins. It’s here that the actual compensation amount is determined and disbursed. An insurance consultant plays a pivotal role in ensuring that the settlement is not just timely, but also commensurate with the loss, ensuring businesses can recover without undue financial strain.

As businesses evolve, so do their insurance needs. Whether expanding services or venturing into new markets, changes can influence the kind of coverage required. Insurance consultants play an important role in periodically reviewing policies, ensuring they stay aligned with business needs.

At Coast & Country Insurance Consultants, we understand the challenges faced by rural Australian businesses. Through tailored solutions and a keen understanding of the local market, we aim to provide seamless insurance experiences for our clients. Reach out today and find out how we can assist in safeguarding your business’s future.