Anyone who's ever had insurance knows exactly what I mean by the "annual letter of joy" from insurers. Usually, it goes something like this: "…Dear Client, your premium will increase from X to Y, but don't worry, you don't need to do anything; your policy will renew automatically…".
Now, I don't want to upset anyone (especially those who bought directly without a broker), but not everyone is great at sales negotiations, and even those who are don't always know the insurance industry's specific tricks to secure the best deals.
So today, I’m taking you behind the scenes of my usual renewal process, sharing secrets and strategies:
Step 1 (The Brief):
First, I have a call with the client to discuss everything that happened during the year. Usually, I already have a decent understanding of their claim’s history, as I often help them handle claims. However, some clients manage their claims independently and only contact me in tricky situations or when the insurer delays reimbursements.
The aim of this conversation is to assess exactly how much the policy was utilised throughout the year, and whether there will be a room for negotiation with provider. I'll share a little secret with you here—I used to be an underwriter myself, so I fully understand the concept of loss ratio (the percentage indicating how much of each pound paid has gone towards claims). Generally speaking, if your loss ratio is below 60-70%, the insurer views this as "expected" and your price increase will likely be reasonable (8-12%). However, if you've claimed over 100% of your premium, especially for several consecutive years, expect a heftier increase.
Understanding the policy performance over the current (and most importantly previous) years provides powerful leverage during my negotiations with insurers. And a quick heads-up: if you're currently undergoing treatment, switching insurers might not be the best idea, as the new insurer will likely exclude ongoing issues.
Step 2 (Market Review):
After speaking with the client and reviewing their health situation, I analyse what's available on the market. Often, if you're insured with the "Big Three" (Bupa Global, Cigna, AXA Global), there'll be cheaper alternatives out there. Eventually I collate a comprehensive snapshot of current market conditions, complete with figures, benefits, options ect.
Step 3 (Proper Negotiations):
This is when I approach your current insurer to explore what they can offer. During this conversation, I speak their language - mentioning "current and rolling loss ratios," market overviews, and use competitors products (especially those that offer slightly higher limits at slightly lower prices). Often, if the loss ratio is within acceptable limits, the current insurer won't want to lose a good client and will reduce their original renewal offer to be in line with the’rest of the market.
Step 4 (Getting Down to Business):
Once I've received the most competitive offer from the current insurer, I discuss the options with the client. Sometimes, the existing insurer’s offer is spot-on, and it's sensible to stick with it (especially if there’s an extensive claims history making a switch impractical). However, if there have been service issues or frustrating delays with the current insurer, it's often worth switching—not just for price, but for better service.
But rest assured, when we consider switching, we never settle for the competitor's initial quote. Absolutely not! I always push for even better terms (after all, your current insurer reduce their original offer, didn't they?). Here’s another insider tip: when you call the frontline (customer service / broker support team / renewal team), their discounts are typically capped at around 5%. However, people who are “higher up in food chain” (i.e. more senior decision-makers within insurance companies) have greater authority—and these are the people I negotiate with.
Step 5 (Closing the Deal):
After agreeing on the final price and optimal terms, I ensure the documentation process is quick, easy, and hassle-free for my client.
And that, ladies and gents, is how renewal is handled ON EVERY SINGEL RENEWAL.
Renewal isn't just a formality. It's a chance to genuinely evaluate your options, see if switching actually makes sense, and potentially upgrade your policy terms.
If you want to make sure your next renewal is handled just like this - drop me a DM.