Starting a Business

America's Best-Kept Secret About Business Insurance

Tabitha Jean Naylor | April 11, 2014
young coffee shop owners smiling.

The vast majority of successful business owners enjoy that status by working hard and making smart decisions. One of the best decisions any company can make is finding experienced, qualified people for key positions. One position that can greatly impact any business investment's chance of success is its insurance agent. Do you want an agent who works for your business, or the insurance company?

To protect your investment and future, purchasing from a quality business insurance company is imperative for the long-term success of your business. As a business owner, however, it can be difficult to know what actually constitutes a "quality" company, given the variety of options available to you. This article will serve as a primer to help guide you in the right direction.

Captive Versus Independent

There are two primary types of insurance agents who will handle your business insurance needs. Understanding the differences between the two will help you determine which one is best suited for your business and your needs.

Captive Agents 

A captive agent is someone who represents a single insurance company. Part of a captive agent's agreement is that only one company's coverage, services and products are offered to clients and potential clients.

Independent Agents

Independent agents, such as those on the Trusted Choice® network, can offer coverage from a variety of different providers. In most cases, independent agents can provide clients with more options, as well as cost savings, given the variety of insurance providers they represent.

Independent agents are able to shop around to ensure you get the best possible blend of coverage coupled with rates. You are most likely busy operating your business. Instead of spending endless hours finding quotes from insurance companies, you can let an independent agent take care of this for you.

In addition, an experienced independent agent can provide you with guidance as it relates to your particular business insurance needs. There are many situations when combining various types of insurance policies can save your business substantial amounts of money. As no two businesses face exactly the same risks, knowledgeable independent insurance agents can help identify your unique liabilities and insurance needs.

Independent Insurance Agencies Meeting Your Business Insurance Needs

A recent study of The South Group, an independent insurance company in Mississippi, shows that 70 percent of their current clients are business owners. This is a significant increase for the company, which mostly dealt with personal insurance policies in the past. In fact, some independent insurance agencies, such as Trusted Choice, are devoted to retaining knowledgeable agents who have carved out an expertise in certain industries, such as the agriculture business, jewelers, and anything in between. These agents can give clients niche-specific service to ensure they receive the coverage and protection they need.

Advantages of Using Independent Insurance Agents for Your Business Insurance Needs

Savvy business owners are turning to independent insurance agents for their business insurance needs because they:

  • Offer a Larger Selection

One of the most obvious advantages of working with independent agents is that you have access to more choices. Independent agents will present you with a number of options, which means you're likely to see policies that will cover the needs of your business at prices that fit your budget.

  • Are More Affordable

Business insurance purchased from independent agencies typically involves cost savings. An independent insurance agent will work to find the best deal for you, instead of focusing on the product selection available from a single provider. This will you save money on premiums, while still giving you the protection you need.

  • Offer Unbiased Advice

When you work with captive insurance agents, you need to keep in mind that they are limited by the options that they can present to you, since the only things they can sell you are products from the companies they represent. When you use an independent insurance agency, your business insurance agent will provide you with unbiased advice. The agent works for you, not those other guys. Some Trusted Choice agents are trained experts in the field and can provide you with the most relevant information possible so that you can make smart decisions regarding your business and your insurance needs. They will work with you to narrow down available options based on your requirements.

  • Can Assist with Claims

When you have an insurance claim, an independent agent will help you through the process. Unfortunately, more often than not, a captive agent will leave you to wade through the waters alone. It's also important to note that independent agents don't have to adhere to the strict protocols that typical traditional agents must follow. With the complicated nature of the insurance world and the specialized language, having a person you can call to ask for advice is a huge benefit.

Even more beneficial, however, is the fact that independent business insurance agents are advocates for their clients. Remember, a Trusted Choice agent works for you, not the insurance company, ensuring the best possible outcome in your interests.

Captive Agent Disadvantages for Business Insurance Policies

If you make the decision to work with a captive agent, you may run into a number of problems that are difficult, if not impossible, to overcome, including the inability to:

  • Purchase an insurance product because the parent company does not offer it
  • Take advantage of competitive prices due to a limited number of options

Additionally, there are many instances when captive insurance agents are forced to sell a certain product simply because the parent company asks them to do so. This can lead to pressure tactics that attempt to sell you more insurance than you truly need.

Independent Insurance Agencies – Are They Right for Your Business?

The big question that you have to ask yourself when it comes to finding the best business insurance is what is best for your business. The complexity of the issue stems from the fact that the answer is not the same for every business; your company will have a unique set of needs that is yours and yours alone. If you want flexibility, options and superior customer service, independent agencies on the Trusted Choice network are the perfect choice. After all, when it comes to running your business, time is money, which means you need to optimize every minute of every day.

These agents ensure your business is protected with the coverage that you need to safeguard your investment. Working with an independent business insurance company means personalized service, a variety of options and flexibility to choose a policy that will provide you with the best possible coverage at the best possible price, which will ultimately benefit you – and your business.

tabitha jean naylor business blogger

About the author: Tabitha Jean Naylor is a popular business blogger who educates business owners on best practices in sales, marketing and business ownership. Tabitha is an experienced and enthusiastic business professional with a passion for excellence.

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