Spurrred by advice from their agent or broker, commercial insurance buyers show increasing interest in buying more than one line of coverage from a carrier, according to a new survey commissioned by Wis.-based Wausau Insurance.
Two-thirds (up from 58 percent last year) of respondents said their agent or broker “always or usually” encourages them to place multiple (at least two) lines of insurance with one carrier. And three-quarters of respondents said they would rather have their coverage priced by one multiline underwriting team than a separate underwriting team for each line of insurance. Among respondents favoring a multiline underwriting team, more than two-thirds completely or somewhat agree the multiline approach is more likely to ensure a fairer price, broader expertise and knowledge of their business.
The independent survey of 200 financial executives, the 3rd annual Wausau Multiline Productivity Poll, was conducted by Guideline, a national market research firm. A similar sample of financial executives, from predominately mid-sized companies, was polled over the past two years with many of the same questions.
“This annual independent survey continues to confirm key messages we’re hearing from our agents, brokers and their clients,” said Mark Fiebrink, president and chief operating officer of Wausau Insurance. “Insurance buyers increasingly want carriers who can provide multiline coverage and services with a focus on the total cost of risk, including lost productivity.”
Seventy-one percent (similar to 69 percent last year) of respondents said their agent or broker “always or usually” counsels them to consider the total cost of risk, in addition to the direct cost of premiums and deductibles, when considering property and casualty coverages. Another 22 percent (up from 18 percent last year) said their agent or broker “sometimes” counsels them to consider the total cost of risk.
“Insurance buyers show a growing appreciation of indirect costs such as lost productivity,” said Fiebrink. “Our benchmark data shows an upward trend of understanding of the total cost of risk among insurance buyers, and their agents and brokers play an important role.”
Among other key findings:
— For the first time, the annual survey shows more than half of
respondents (52 percent compared to 46 percent last year) regard the “total cost of risk” more important than “direct costs” when considering quotes for property and casualty insurance coverage.
— For the third year in a row, 60 percent of respondents estimated they save at least $2 in lost productivity expenses for every $1 saved by reducing claim expenses for workers compensation. And for the second year in a row, about half of the respondents estimated they save at least $2 in lost productivity expenses for every $1 saved by reducing claim expenses for other lines such as general liability, commercial auto and property.
— A large majority of respondents (80 percent this year) continue to integrate multiple (at least two) lines of coverage with one carrier. Among those who have combined at least two lines of coverage with one carrier, 92 percent (up from 89 percent the past two years) said they achieved significant efficiencies (saving at least 4 percent per year).
— Sixty-four percent (up from 52% last year) of commercial insurance buyers said it would be an advantage to have multiple (at least two) lines of insurance with one carrier if their company experienced a catastrophic loss due to a natural disaster or terrorist attack.
— For the third year in a row, general liability & property (two
coverages commonly combined in package policies) and workers
compensation & general liability stood out as the two coverage pairs
most likely to achieve significant efficiencies when combined with one insurance carrier.
Fiebrink said Wausau will continue to explore multiline trends and the ultimate cost of risk. The Wausau Multiline Productivity Poll on the company’s web site, http://www.wausau.com/poll, will continue to be updated and revised annually as a tool to shed new light on the issue.
Wausau Insurance is a national property and casualty company, providing commercial auto, general liability, property, umbrella, workers compensation and other coverages.
Source: Wausau Insurance