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Damage to Premises Rented to You
Under the standard Commercial General Liability (CGL) policy, this is one of the liability limits (with a basic limit of $100,000) and applies to fire damage to premises rented to the insured and to damage regardless of the cause to premises and its contents which the insured occupies for nor more than up to seven days.
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Renewal ResponsibilityOne of the top skills a Consultative Broker utilizes in the Soft Marketplace is their ability to successfully negotiate renewals that offer honest and responsible pricing and terms. Notice I used the terms “honest and responsible.” When was the last time those concepts were used in a competitive environment?
Here is the deal: when you go into a “soft market” renewal, and you are in a broker market competition, there are very few “honest and responsible” negotiations – it is every person for him/her self. Everyone is in competition trying to protect their own interests.
Your Competition: they are attempting to attract the prospect by making them the ‘offer they can’t refuse.’ After all, it is new business to them and therefore anything they add to the top line is gravy (or so they think). In any event, if they get you to reduce your income substantially it is still a win.
Your Prospects: in some cases you spend time protecting yourself against your own prospects! You hate to give them too much information too soon. After all, they may give your terms out to other brokers for the purpose of driving a better deal. If you haven’t used the Consultative Brokerage methodology, then you can’t expect to get any broker control.
Your Carriers: Let’s get something straight: most carriers hate the soft market as much as you do. But, we spend time blaming them for the pricing ravages of the soft market. After all, when most of their agents sell on price, they need submissions so that they can cherry pick the ones to really go after (i.e. price).
So, these types of competitions are a swirling cesspool of falling prices, professionalism, and ethics! Are you having any fun yet?
_Well it is time to put the words “honest and responsible” back in our vocabulary and business negotiations. Here is how a Consultative Broker does it:
They maintain or seize “Broker Control." During the prospecting process they understand that there are several pressure points. These pressure points provide Consultative Brokers with the opportunity of differentiation.
They prospect on issues. A Consultative Broker understands that a buyer is not motivated by simply the hazard risk. They are well versed in issues that surround the prospect’s entire Enterprise Risk. Once they establish a business dialogue based upon issues, they can negotiate from the buyer’s side of the table.
They don’t keep the clients or carriers in the dark. They understand that if they are to remain successful in this business, it demands the ability to transition from one renewal date to another. If they keep one of the parties in the “dark” they know that once the light shines it will fall on them!
They never allow one of the parties to dictate. This type of negotiation usually ends up to be one-sided. When that occurs, the remaining side is usually in the lose/lose position. Eventually the scales tip and crash directly on the broker’s head for allowing it to happen.
They do not commit ethical suicide. A Consultative Broker knows the history of this business. The last soft market lasted about 17 years. They recognize that they will need their reputation for a long time. They just aren’t willing to throw it away in one negotiation.
They lay all their cards on the table. When they ask an underwriter for concessions, they state exactly why they need them and how they are going to be used. Also, they make certain the client understands that these concessions are not “Let’s Make a Deal.”
They obtain permission to ‘lock and load.’ They always have the agreement of both the underwriters and the client to agree on behalf of each other. This ‘lock and load’ mentality allows them to be “honest and responsible” in finalizing the terms of the agreements.
The soft market brings out the best and worst of our industry. The worst are the “bottom feeders” who think that they can make hay in these times of falling prices. The best are the Consultative Brokers who realize that the pricing cycle is simply part of our business. They have developed the negotiation skills that allow them to prosper in all marketplace conditions. They have, and always will, run their business operations in an “honest and responsible” fashion.
For more information about the services and products provided by Rob Ekern, visit www.crekern.com.
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