Loss ratios are about the most critical component to maintain your contract to sell Bridger’s products. It’s quite simple; the higher your loss ratio, the more likely your ability to sell Bridger will be limited or withdrawn.
In speaking Gerry Gruska, principal at Bridger, he stated, “Loss ratios are the main killer of agency success. Once an agency starts down that path to bad loss ratios, recovering is hard and it can result in losing carrier contracts.” So, what can you do to help assure loss ratios remain low?
1) Processes and Procedures: Everyone in your organization should know how to process changes, write new business, and understands how the Agency conducts its business. This is important! Everyone, including the CSRs, licensed agents, and management should operate the same way. All business should be written by licensed agents.
2) Knowing Carriers Underwriting Guidelines: Placing business correctly and efficiently the first time will reduce your agency’s overall cost. It reduces your E&O exposure, while limiting additional customer service calls and rewrites.
3) Field Underwriting: Your agents need to ask insureds all the basic underwriting questions. So many times I have watched agents just type in the answers without asking one probing question. Many policies get written incorrectly! Many agents try and write the cheapest price policy and skip the probing questions, and end up costing your agency and the carriers valuable income.
4) Providing Proof: Every Carrier has some sort of validation process. It’s up to the agents to collect the required documents and correctly apply them to the policy. This is one of the most abused processes we see in the industry. Many agents write business incorrectly from the start by not properly submitting required evidence to support the application; Photo’s, Licenses, Proof of Insurance, and other highly important documents.
5) Training: Everyone should be trained on each Carrier’s system. This eliminates mistakes, additional phone calls, and saves the agency a considerable about of money. Bridger Solutions is your key to this point.
Doing little things correctly will prevent small issues from turning into bigger problems later and damaging your loss ratios. No matter how big or small the agency is, we need to understand that without profitable business no one is successful.