Digitisation has changed the way we buy and sell insurance. If you were to shop for an insurance policy years ago, you probably would have discussed coverage and terms across the desk from an insurance broker.
Meeting with an agent or broker in person is not always required and if you already have an idea of your protection needs, buying from an online insurance broker can make the transaction even easier and more convenient for you.
A digital insurance broker can assess your insurance needs, present you with policy options and answer your queries through your preferred online channels.
Especially now amid the COVID-19 pandemic, this level of ease is something you want when companies are rushing to purchase business disruption policies. Going the online route can help expedite your transaction, giving you the protection you need quickly.
Benefits of Working with an Online Insurance Broker
Modern insurance brokers use digital platforms and tools to offer you services that are more efficient than the traditional process of face-to-face meetings. When you work with an online broker, you can expect the following benefits:
Digital brokers automate many client-facing processes, including:
- Onboarding new clients and collecting their data
- Generating documents, such as custom welcome packets and certificates of insurance
- Calculating and sending quotes
- Generating customised proposals and making recommendations
- Administering policy renewals and cancellations
- Crafting and sending reminders and follow-up notices
Their optimised processes take the hassle out from the entire transaction. You can conduct all the necessary steps remotely, from the initial insurance assessment and calculations to finalising your terms.
Better Customer Experience and Support
Digitisation allows brokers to offer better customer experience. One of the biggest advantages of working with online insurance brokers is their availability. You can reach them through your preferred platform, whether that’s social media or email, and you can expect a prompt reply.
This kind of accessibility not only hastens the purchase process, but it also helps you further down the road. If your broker offers claims management services, they need to be reachable 24/7 in case you have an emergency.
If your broker does claims handling, they likely leverage related tools and technology as well. There are types of software that allow them to upload claims-related documents into the system, link claims to policies, manage the claim lifecycle and create to-do lists to remind them of claims-related tasks.
Working with a broker that utilises such technologies will give you the assurance that their service is reliable, punctual and accurate. A tech-savvy insurance broker can help you avoid common problems when it comes to filing claims, including poor documentation and not guessing the insurer’s calculations.
Transparency is important for all parties involved, meaning you, your broker and the insurer. A broker must be upfront about their fees and the coverage of their services. You don’t want to work with someone who’ll charge you with hidden fees or balloon the rates of the insurance so they can get higher commissions.
Online insurance brokers use tools and software for computations and quotes for each insurance scheme. You’ll clearly see how much your insurance premiums are, how much interest you’re paying for and how much commission is the broker charging you.
This level of transparency lets you estimate how much you’ll be paying throughout the lifetime of the policy, which is critical to staying on top of your finances. Plus, if your broker is transparent with you from the beginning, it’ll be easier to review your policy and spot any discrepancies or inaccuracies.
On the other hand, brokers who can’t be fully transparent with you are suspicious. Don’t proceed with your transaction and look for another broker.
How to Find an Online Broker
Now that you know how an online insurance broker can help you, the next step is to look for one that understands your protection needs. It can be challenging to find a reputable broker online since it’s difficult to prove their trustworthiness and competence.
To make sure you’re working with a licensed, credible insurance expert, follow these steps when looking for a broker online:
Obtain recommendations from people you know
The best way to find trustworthy brokers is still through people you know. Ask colleagues, business associates and other players in your industry for referrals. You can also obtain recommendations from trade or professional organisations and websites.
The advantage of this method is that these referrals are tried and tested. Your acquaintance vouches for the broker’s skills and service, so you won’t have to go through the trouble of performing background research on them. Of course, you still have to determine if the broker’s services and work processes align with your needs and expectations.
Use the ‘Need a Broker’ website
If you can’t get any referrals from your colleagues, try the National Insurance Brokers Association (NIBA) website. NIBA is the representative body for Australia’s insurance industry. It offers an online tool called Need A Broker that helps you find a licensed insurance broker in your area that’s registered with the NIBA.
Need A Broker lets you select what type of insurance you’re looking for and what type of business you’re trying to insure. So, if you’re in need of tradie’s income protection insurance, you can specify that and the website will show you a list of potential brokers in the area.
Questions to Ask Potential Brokers
Before you make deals with any broker, you need to make sure they have the experience, tools and skills you want in a broker. List several potential brokers and ask them questions to determine how compatible they are with what you’re looking for.
Here are some of the questions you want to ask your potential broker:
What are the exclusions of your public liability insurance?
Most trades have mandatory public liability requirements, particularly those that need a government-issued license, such as plumbing and electrical. If you’re getting public liability insurance, you need to know what your policy covers.
Public liability insurance typically covers damage to someone else’s property and third-party personal injury. But most policies don’t cover the following:
- Poor workmanship
- Contractual liability
- Exposure to hazardous substances
- Incidents related to fraud
Knowing the exclusions of your public liability insurance lets you see the gaps in your protection needs. If there are risks you want to be protected from, you can ask your broker which insurance policies can supplement your public liability coverage.
How flexible are your payment terms?
Cash flow is a common challenge for many small businesses. Plus, those that are in the growth stage are capital-intensive, so you need the funds to make sure your business has what it needs to take off.
With that, you want a broker who offers flexible payment terms. If you can’t afford to pay one large lump sum, ask the broker if you can make smaller payments over time instead. You can either pay monthly, every two months or quarterly, depending on your financial situation.
What does the claims process involve?
If your online insurance broker offers claims management, enquire about their handling process. Ask who your point of contact is; will you be talking to the same broker or a designated claims person?
Also, ask if you can talk to your insurance directly when you’re filing a claim or if you need to wait for your broker’s advice.
It’s also a good idea to enquire if your broker charges additional for their services throughout your claims filing experience.
What additional fees do you charge?
All insurance brokers charge a broker fee. This is additional to the insurance cost set by your insurer but should still be included in the premium you’re quoted. There’s nothing wrong with brokers charging service fees, but it’s important to know how much you’re paying them.
For an average trade insurance policy, most brokers charge around $50. If they’re charging you more than $100 for basic coverage, that’s probably a bit much. You might be better off with a different broker.
Online insurance brokers still perform similar tasks and roles as traditional brokers who rely on face-to-face meetings. The difference is that, with the former, you gain more benefits in terms of convenience. You can conduct most of your insurance-related activities remotely so you won’t have to go anywhere or meet anyone in person.
Purchasing a policy through an online broker has its advantages. But this approach is ideal for buyers who already have an idea of what kind of protection they need. If you need an extensive assessment of your business risks and liabilities, a face-to-face meeting with a broker might help you understand your insurance needs better.
Your Digital Trade Insurance Partners
For over 35 years, IMAR has been providing much-needed coverage for builders, tradies and small businesses. More than just insurance experts, we’re your partner in making sure your trade is adequately protected from your unique business risks and vulnerabilities.
IMAR offers a range of policies and schemes to fully insure your business from potential losses, from public liability insurance to income protection.
To the extent that any material on this page may be considered advice, it does not take into account your objectives, needs or financial situation. You should consider whether the advice is appropriate for you and review any relevant Product Disclosure Statement and policy wording before taking out an insurance policy.