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Time Saving Tips for Shopping Around Before Your Insurance Policy Renews

July 3, 2013

Most businesses we talk to know it’s a good idea to shop around for competitive quotes when it’s time to renew an insurance policy. Yet, many businesses choose not to research their alternatives at renewal because digging up the info needed to answer a new agent’s or carrier’s questions can seem like a lot of work, especially when renewals usually happen every year. It may seem easier to just renew your in-place policy and save yourself the hassle, but seeking competitive quotes can help guarantee you’re paying the lowest price for the insurance you need and it doesn’t have to be terribly difficult.

This week, we would like to offer a few tips to help simplify the “competitive renewal” process. We have years of experience helping our clients review their policy options months before renewals. Here’s what we’ve learned.

Have Your Declarations Page, SIC Code, and FEIN Ready

These three pieces of information can get you a long way. First, the Declarations page (or “Dec. page”) of your current policy contains a lot of the information an insurance provider will need to write you a quote, including the type of policy you’re looking to replace, coverage limits, current premium, important facts identifying your business, and who is covered as an insured. You will find the Dec. page at the beginning of your insurance contract. Simply make copies of all of your policies’ Dec. pages and keep them somewhere so that they’re easy to retrieve when it’s time to “go shopping”.

Next, if you don’t already know your business’s Standard Industrial Classification (or “SIC”) code, go to the Occupational Safety and Health Administration (OSHA) section of the United States Department of Labor website and search for your type of business using basic keywords.  As a reminder, an SIC code is a four-digit code used to classify the businesses within your industry.  Insurers use SIC codes to identify the risk exposures unique to different types of business. Print the OSHA SIC description that best fits your business and place it in the file along with your Dec. pages.  Providing agents with a copy of your Dec. page(s) and SIC code can give them a general picture of your insurance needs.

Third, providing Dec. pages and SIC codes likely won’t answer all an agent’s or insurer’s questions. In order to get an accurate quote, you will also need to provide your business’s federal tax identification number.  If you’re a sole proprietor, it will likely be your social security number.  If you are organized as a partnership, limited liability corporation (LLC), etc., you will need to provide the business’s tax identification.

Lastly, depending on the type of quote you’re seeking, you may need to provide info on your employees, company vehicles, gross receipts or other aspects of your business. You can expect more questions, too, if your business saw a lot of growth or changes during the policy period. The advantage of having Dec. pages, SIC codes, and tax ID information on hand while speaking to an agent is that these documents provide standardized information insurers are accustomed to reading. This information helps insurers get to their more specific questions faster and can help to avoid a lot of confusion and extra work for all parties involved.

You Don’t Have to Go It Alone

The major difference between so-called “captive” and “independent” insurance agencies is that captive agencies are only appointed by one insurance carrier while independent agencies offer insurance through multiple competing carriers. A good independent agent can work like a “one stop shop” for competitive quotes by soliciting bids from multiple insurance companies and walking you through the resulting policy alternatives so you can make an informed decision. Be aware: some independent agents charge a brokerage fee for this service and others don’t. However, for many business owners the convenience of only providing information to one trusted agent makes working with an independent agent an attractive choice.

For more helpful insurance tips written by independent agents, you can subscribe to the Avanti Reader via RSS or follow us on Facebook or Twitter (@AvantiInsurance). Thanks for reading.

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