I believe that long-term contracts benefit insurers and brokers much more than their clients. So, as an industry, do we fail our customers? If you`re thinking of reaching a long-term deal, it`s important to read the fine print and see exactly what you`re getting. In this case, the company charges the insured the 15% discount allowed in previous years and this invoice is an enforceable debt. By accepting the policy associated with this consent, the insured accepts the above conditions. I spoke this morning with a business manager who had entered into a five-year long-term contract (LTA) on the company`s insurance to save money. In other words, they had signed an agreement that promised to stay at least five years with the same insurer (and probably the same insurance broker). For this loyalty, it was probably agreed to reduce insurance premiums due during this period by 5-10%. MR 313 – Coverage in the event of internal fires, internal chemical explosion and direct lightning The ability to change over a 12-month period is an undeniable advantage in negotiating premiums, fees, coverage and service. In today`s marketplace, when insurance companies compete and offer discounts for new business, loyalty cannot always be rewarded.
This means that the business is effectively tied up and cannot easily switch to another insurer or insurance broker who offers more advantageous terms until the end of the five years, even if they are not satisfied with the service they receive. However, if the insurance company decides to increase the premium, for example because of a bad experience of claims, it can generally get out of the LTA easily. I advise you not to change your insurance every year – it stifles competition and interest in the market – but I strongly advise you to protect your freedom of movement. Your broker should have confidence that he can get results from year to year, not just every 3 years. So before deciding whether a long-term contract is a good idea or not, do you think who will benefit the most – you, your insurance broker or insurance? I think long-term contracts benefit insurers and brokers much more than their clients. So, as an industry, do we fail our customers? If you`re thinking about getting a long-term deal, it`s important to read the fine print and see exactly what you`re getting. Is it a good idea to sign a long-term contract for a discount on your business insurance premium? This means that the business is effectively tied and cannot easily change insurers or insurance brokers that offer more advantageous terms until the end of the five years, even if they are not satisfied with the service they receive.