You have been working with GAIG for 6 years. You currently provide them with about $400,000 of business each year within Inland Marine. Your contact there has been a great partner and made your life easy since you started working together. That, along with their specialized underwriting are the reasons you often carve out the Inland Marine from other policies and send them to GAIG.
For reference, currently the property piece makes up 40% of the total premium. And, your current commission is 15%. You have made it clear during previous conversations that you would not be willing to move toward a fee instead.
Your contact asked you to meet about a specific policy you have which is up in about 120 days. Last year you were disappointed that GAIG asked you for 10% increase 20 days before the policy was up for renewal. That would have put you in a terrible spot with your client – not was it a healthy raise, it also was last minute. You don’t like surprises and are still a little bitter about the 5% increases you agreed to. It was easier to pass it on to your client than you thought but you hope the last-minute big asks don’t happen again.
Your client is a construction equipment rental business with some new equipment sales. They rent their equipment to a set group of people on a regular basis. They are required to carry the primary coverage and GAIG is contingent.
The equipment is the leading line of business on the account, but there are some office buildings and shops that are part of the policy. The buildings are all masonry non-combustible and in a protection class 5.
Since GAIG called you to set up a meeting about this policy you reviewed the policy and your notes. The current premium is $55,169. GAIG did tell you that another price increase would be coming – you aren’t sure what sort of percentages they are talking about. You let them know that you would be open to reviewing higher deductibles and your hope is that will make up for all if not more than the price increase. You have not spoken with your client yet about this but you expect that they will be more sensitive to price increases than they will to increases in the deductible, since they rarely had any claims.
You are about to meet with GAIG. Your goal is to get the best price/options possible for your client but do so in a way where you remain on good terms with GAIG. They are the premium provider of Inland Marine insurance and your clients (including this one) appreciate them – and as a result, you do as well. In the few scenarios where you have left GAIG for another company over price (large increases due to their stupid “Predictive Analytics” you have found that a year or two later the other insurance company has raised their prices as well, which again is consistent with GAIG being an industry leader. However, given the hassle of marketing the account once to move it away from GAIG, you have avoided coming back to them unless the client has requested it, the new insurance company raises their rates even more aggressively, or there is another compelling reason to do so.