A lesson in the importance of service, transparency
Service can make broker-agent-client relationships and its absence can break them, as Burns & Wilcox Assistant Vice President David Derigiotis saw firsthand this past summer.
Derigiotis, who heads the Burns & Wilcox Center of Excellence for Professional Liability, and several other Burns & Wilcox executives were meeting in Maryland with four retail clients. As he described the services his group could provide within professional and executive liability, he noticed an odd expression come over one person’s face.
The agent explained that until recently she had been placing professional liability coverage for a property management firm through another major brokerage. An issue arose when the broker produced renewal terms that included a 50-percent premium increase, without providing any details to justify the price hike. The agent told the group she had attempted unsuccessfully to pry an explanation for the premium increase from the broker, nor could she get the broker to negotiate more favorable terms or to shop the account.
With the expiration date fast approaching, the agent had no choice but to present the new pricing to her client. Needless to say, her contact at the property management firm was unhappy, leaving the retail agent frustrated and searching for alternatives in the name of retaining the account.
Sensing an opportunity to fill the service void, Derigiotis immediately asked the agent for a chance at the account. The agent provided the details, and Derigiotis got to work “thoroughly vetting the marketplace,” he recounts. “Within 48 hours, we provided a perfect alternative that satisfied the insured’s needs from a pricing and coverage standpoint.”
Property managers face professional liability exposures in four primary areas:
- Issues of discrimination from current, prospective or former tenants
- Failure to disclose material facts about the property
- Exaggerating features about the property
- Tenant improvement issues
By understanding these exposures and the specific practices of a business, a knowledgeable, service-oriented broker can effectively present the risk to potential carriers and negotiate good terms.
The new quote, which provided the same $5 million limits as afforded by the expiring policy, was with a highly rated carrier, as the Burns & Wilcox Center of Excellence only works with A-rated (or better) carriers, notes Derigiotis. The price was slightly higher than the property manager had previously paid, but that was because the business and its revenues had grown, with a concurrent increase in exposure.
Now the agent had a solid quote in hand along with a clear explanation to bring to her client.
“Our job as brokers is to make our clients look good, and clearly our competition had forgotten that,” Derigiotis observes. “It’s easy to become complacent. But we’re very careful about not resting on our laurels. We pride ourselves on product expertise, market access and having the ability to solve problems for our clients.” That kind of mindset leads to lasting relationships for brokers, agents and their clients.
That kind of mindset leads to lasting relationships for brokers, agents, and their clients.