Most insurance agents and brokers have worked hard to build their businesses and their reputations. Clients trust them to provide good advice and to really understand their businesses and exposures. So when a disaster strikes, it’s only natural that clients would turn to their agent or broker as a primary resource for what to do to recover from their loss. This article covers a few details agents and brokers should know ahead of time to position themselves as the best possible resource for clients after a catastrophe.
Preparing clients for disaster
A dedication to understanding clients’ exposures-and, perhaps more importantly, helping them to understand them-already represents one of the key lines of defense between one’s insurance clients and potential financial ruin. As the nation is learning in the aftermath of Hurricane Katrina, being properly insured is of utmost importance.
Education is one of the most basic ways agents and brokers can serve their clientele. Especially with business losses, agents are most effective when they help clients think about the various ways their companies might be affected by a loss-their own or that of a major customer or supplier. Articles from third party sources or a newsletter containing case studies are excellent ways to help clients imagine a variety of “what if” scenarios.
Brokers and agents should encourage clients to take photographs or video of their property before a natural disaster occurs, along with any year-end inventories and financial statements (these serve as the basis of a claim in a total loss situation)-and to keep them updated. CDs can easily be stored off site for safe retrieval when needed.
Clients should also understand the importance of having a response team in place to handle public relations and initial interactions with the insurance carrier. This is essential, since as any insurance professional knows, insurance verbiage uses terms that sound “normal” but carry significant meanings. Experience shows that the smallest offhand comment from an uninformed employee can make a big difference in the claim process.
Prepare the agency for disaster
As Hurricane Katrina demonstrated, brokers and agents can’t necessarily count on their own offices being up and running after a disaster. They should follow all the same advice they would give a client in this situation.
Getting back in action fast after a disaster is especially important for service professionals. Data backups should include not only the broker’s own business records, but the policy details of their clients. Clients will be counting on their insurance broker for a fast, accurate response during this critical period. Agents and brokers should have a communication backup plan in case their own office is destroyed, along with a clear idea of how clients will reach them after a catastrophe.
The best time to partner with disaster recovery professionals is before a disaster hits. Brokers will want to be able to recommend board-up companies, water extraction companies, and restoration contractors so clients can take immediate action to mitigate their loss. In addition, brokers should establish a relationship with a licensed public adjuster whose work they trust.
Before, not after, a disaster is also the time to become familiar with the claim settlement process itself. The more brokers and agents attend seminars on the adjusting process and read case studies about how claims were actually settled (and the complications that arose), the more they’ll understand what clients need during disaster recovery.
How to best help clients post-disaster
Disaster checklist. Once a disaster has hit, clients will be looking to their broker or agent for specific answers about what to do next. A checklist that outlines clients’ duties and responsibilities can be very helpful at this time.
Cash flow is key. One of the most important roles brokers can play for clients is to advocate for expedited advances. Cash flow is critical at this time. Brokers should educate clients on how to have good documentation early in the claim process to enable carrier(s) to forward a substantial partial payment. Brokers should also make sure clients know they can’t assume the insurance carrier will issue an advance in a timely manner. In addition, both brokers and their clients will want to document all conversations with insurance company personnel.
Call on external expertise. Sometimes the best way to serve clients is to know when to call in specific expertise. In their role as trusted advisor, brokers will find that leveraging the relationships built with disaster recovery professionals prior to a disaster will be especially helpful to their clients’ long-term financial recovery.
Robb Greenspan of Adjusters International is a
regular contributor to IJ. Adjusters International is
a claims consulting/public adjusting firm. For more