Between labor shortages, supply chain delays, interest rate hikes, and building valuation increases, It hasn’t been the easiest year so far for building contractors. The cherry on top has been insurance carriers issuing significant rate increases and cutting coverage for many of their insureds.
Jencap has a few ways that you can support your contractor clients during this hard market and solidify your relationship as a value-added partner to them:
1. Communicate and educate. Now is not the time to go silent with your contractor clients. A big part of your role as an agent during this time will be providing education and information. Explain up front how increased building valuations affect premiums and how challenging capacity is in this marketplace.
In addition to speaking and meeting one-on-one with clients about their specific situations and policies, think about how you also might communicate in ways that scale across your client base. Leverage different communication channels—like email and social platforms—to share timely news, education, and insights that are relevant and useful to their business.
2. Create a clear picture of risks. One of the best ways to plan ahead is by looking back. And while past performance doesn’t always indicate future outcomes, it’s a great place to start. Work alongside your contractor clients to assess where they encountered problems or delays in the past. Big jumps in material prices? Shipping delays? Back-ordered products? Theft and breakdowns in security? Labor constraints? From there, work through plans to overcome those challenges.
3. Get ahead of the game. As an agent, you know that to provide the best service to your clients, you need to think several steps ahead. That’s true now more than ever. Here’s an example: The non-residential building market is getting a $1.2 trillion cash infusion from the Infrastructure Investment and Jobs Act. As a result we can expect project activity to increase for bridge and road work, as well as improvements to power infrastructure and the electric grid.
Have any new clients submit their quote requests as early as possible and double-check all submission requirements to be sure you’ve included all the information the underwriters need. Encourage existing clients to regularly review their policies to make sure their current scope of work is covered.
4. Think holistically about coverage needs. When working with contractors, don’t forget to take a step back and consider all aspects of their business. Virtually every company, regardless of industry, processes and stores sensitive company and client data digitally. Does your client have cyber insurance to protect against cyber attacks or data breaches? Or are they cutting costs and managing timelines by pre-engineering components of the construction project off-site? If so, they may not realize they need to think about off-site coverage and the risks involved in transporting those large components from one place to another. Is there a site pollution exposure where their work is being conducted?
The risk potential can be endless, and their insurance policies need to reflect that.
5. Tap into your extended professional network. You likely have a strong network of banks, financial experts, attorneys, PR experts, and other business professionals. Offering that professional network to your clients gives them the resources to weather this economic uncertainty. It also makes you an indispensable resource for their business, providing value beyond insurance alone.
6. Partner with wholesale brokers to find the best coverage options. Construction accounts are all so different that a specialist is required to ask the right questions and know exactly what lines of coverage are needed for the risk. In this hard market, a strong wholesale partner can not only bring their expert knowledge to the table, but bring a broad spectrum of markets that can plug the gap in capacity challenges you might face alone. Comprehensive insurance packages require layers upon layers these days, and a generalist simply doesn’t have the experience to put those deals together correctly.
Jencap specializes in construction and has the wholesale brokerage markets, binding facilities and exclusive programs to get your deals done. Our industry-leading brokers will set you and your clients up for success despite the hard market. Contact Jencap today for a quote.
