We are living in difficult economic times, and it will be perfectly understandable if you find yourself looking to cut your costs, by measures like trying to get the most affordable types of insurance coverage. Thankfully, going through the vast amounts of literature available on the subject of insurance, a number of ways through which one can get access to insurance at reduced rates emerge; and these are well worth of your attention if you are really keen to cut on your costs.

The first way through which you can get insurance at highly reduced rates is by opting to work with an insurer providing a variety of products (say an insurer providing car insurance, home insurance and health insurance), and then getting the different types of insurance you need from them. This way, you stand to gain access to what can be termed as ‘quantity discounts’ that insurers give to those of their clients who take more than one type of insurance product from them. If you take your home insurance from a given insurance provider and then look to purchase car insurance from them, for instance, chances are that they would offer you the car insurance at prices that are significantly lower than what they would otherwise charge you for it were you shopping for it alone; and probably at cheaper rates than you would ever get it for anywhere else. Of course, before taking this step, you have to ensure that the insurance provider you are looking at is very stable, lest you put all your eggs insurance-wise in a single basket, only for the basket to go down with all of them!

The second way through which you can get access to insurance at highly reduced rates is by shopping far and wide. As it turns out, insurance premium pricing varies greatly from insurer to insurer (even for the same type and level of coverage), meaning that the search is likely to be well worth the effort. Thanks to the power of the Internet search engines, comparing the different insurance providers in terms of pricing is likely to be relatively easy than it would have been a few decades back. In that era, such comparison would at the very best involved making dozens of calls to the different insurance providers you were considering get insurance from, or straddling the length and breadth of the different streets and aisles visiting the offices of the various insurance providers at worst. Through the power of the Internet though, all it takes to get to the next insurance provider is typically just to enter their name on your search engine box, and once at their website request for the free online quotes that insurers are nowadays more than eager to give.

Understanding the workings of insurance – and the risks against which you take insurance – is yet another step you can take towards reducing your insurance costs. As it turns out, insurers tend to offer the products are significantly lower prices to those of their customers who take steps to prevent – or at least mitigate – against the risk for which insurance is being taken. Investing in approved security-optimized gating for your home, for instance could go a long way towards substantially reducing your home insurance costs, as would purchasing certain car models whose accident risk profile has been noted to be lower – a step that could substantially reduce your car insurance costs.

By: Mark Cross

First, we need to make a distinction between an insurance “broker” and an insurance “agent.” In the insurance business, an agent is in partnership with one or more insurance companies. A dedicated agent has a contract with a single company, normally an insurance business that prefers exclusivity, and can only sell the insurance products of that company. An independent agent may work with a large number of companies, including AIG, CHUBB, and The Hartford, to name only a few.

A broker does not work for an insurance business but instead for a client in the market to obtain insurance. So if a new business owner wanted to purchase commercial liability insurance, a broker would not be restricted to only those insurance products sold by his or her partners as an agent would be, but could check with any commercial liability insurance provider. Brokers tend to work with non-standard, “excess and surplus” line insurance providers. These firms specialize in unusual coverage, often for emerging technologies, and generally do not enter into agreements with agents. For example, if XYZ company created a new kind of communication equipment where the potential liability risks were unknown, XYZ would most likely need to approach a broker in order to buy commercial liability insurance.

The best way to get started as a broker in the insurance business is to get a job with an established broker. There are many classes you can take on commercial liability insurance and a great deal of research you can do on the existing excess and surplus carriers, but having theoretical knowledge isn’t enough to make you a successful broker. An established broker can introduce you to the people in the insurance business. After all, it is a surprisingly small world and your future success depends on the associations you make. Additionally, an established broker can steer you past the many pitfalls inherent to the industry, mistakes that could cost a client his business. It is best to make these mistakes with someone experienced at your side to catch them and instruct you as to how to avoid them. And, more importantly, you don’t want to make these mistakes when you’re the one paying for the errors and omissions policy, because once you are on your own, the first thing you’ll need to do is get your own errors and omissions coverage. After all, even people in the insurance business need to have insurance. Any broker you work for will probably ask you to sign a limited term non-competition contract, but these usually only apply to businesses within the same state.

A broker, like an agent, is licensed by the state, with the assumption that the broker resides in the same state they do business in. Each state has its own requirements, which generally include a fee and a specified minimum level of education. An insurance business license must be renewed regularly, and continuing education courses may be required as part of the renewal requirements.

You may apply for a non-resident license, but do keep in mind that other states may have different licensure qualifications. Licensing information can be found on most states’ insurance department websites. Additionally, if you intend to work in a different state, you will find it useful to have an agreement with an in-state brokerage firm for tax purposes. And if you move to a new state, you will need to get a certificate of license status from your previous state where you were licensed in order to prove that you were a broker in good standing.




By: James Cochran