Most employers or organizations allow far to many brokers to quote on their account without ever vetting them first.  Big mistake.

The world is no longer flat.

Throwing out bids packages is not the answer (which is exactly what most organizations are doing).

The prudent and more sophisticated approach (although not complicated by any means) is to do a broker selection and then empower that firm to go to market on your behalf if they are qualified and large enough to command a large inventory of markets.

Why focus on a broker selection?

Because the right broker can take your program to the next level, and reduce the underlying costs of your program, create efficiencies, all of which translates into your firm getting the very best pricing on a consistent basis, year after year.

The priced only “tunnel vision” focus is short-sighted and self-defeating because it never gets down to the core issues, those which are driving the whole equation.

Unfortunately no one has ever educated employers and organizations, and they do not have a true benchmark to compare and contrast brokerage service providers.

Below is a brief story illustrating the above –

Many years ago we reached out to a nonprofit organization in the East Bay.

·       They had determined they were going to terminate the relationship with their current broker (it was not a good one).

·       They spoke with several brokers, then narrowed the field down to two brokers, our office and another large regional broker.

·       Then they did something very unique…

·       They invited us to come into their offices on separate occasions and sit before a panel consisting of their Executive Director, HR Manager and one other person.

·       Prior to meeting they asked for us to both prepare a service proposal detailing exactly what they would do for their organization (this cut out all the fluff and “smoke & mirrors” and dog & pony shows).

·       After we presented, we went through a Q&A session with panel.

·       After presentations they followed up and notified us of their selection.

·       We won and we were grateful for the opportunity.

·       However, I was thoroughly impressed with how methodical and focused it all was and have never seen anything like it before or ever since.

Now, the above can be simplified, and we can give you the tools to make the experience very easy.  However, the biggest mistake is to miss the main point….

Always, do a broker selection!  Because the right broker, those who are in the top tier of service providers can change your world forever in this space.  Yes, it is not a level playing field, Workers’ Compensation is challenging.  No, it will never be “fair” to employers.  But through the cumulative effect of a well-developed, methodical approach which truly addresses the cost drivers in the system, you can and will improve your results. 

And it does not have to be hard.  Sure, you have to look in the mirror and make some honest assessments but most of the heavy lifting should be done by your broker.

However, it can be challenging because in our experience we have seen very small percentage of brokers who fit that bill, who are really putting in the work and have the high-end programs and tools. Make no mistake, there are some talented firms out there delivering a solid program, unfortunately they are a small percentage of firms we have seen.

Take a look at the next tab and see what one question you could be asking the will help in this effort.  Based upon the kind of premiums many organizations are paying, they deserve so much more.