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Good service can be hard to find these days. Many businesses may need frequent certificates of insurance or they might need a policy change in order to satisfy some specific insurance requirements. We understand that employers need fast, efficient and knowledgeable service from their agent of record.
If you operate in a very specialized industry there may be other agents that have more experience and may offer better advice. Expert advice can help save money or better manage coverage selection. Some insurance agencies specialize in a particular industry or a select few industries. Many agents do not have a broad knowledge on workers comp insurance. Often times, only a select few agencies will have access to specific class codes with the same insurance company because so many agent lacks the underwriting expertise.
Current Agent Doesn't Have Access to the Right Markets
Insurance agents must be appointed with each insurance company they represent. In order to get appointments, agencies must produce a minimum amount of premium each year. Many small agencies simply can't support that many appointments due to production requirements. We write a lot of workers comp across the United States and that makes it easy to keep appointments with more than 40 carriers.
Your Workers Comp Audit Was Mishandled
Its pretty easy to end up with an inaccurate workers comp audit resulting in more premium being due at the end of a policy term. Sometimes an agent will incorrectly classify employees in the wrong class code. Other times its the auditors fault and the agent must step in and help resolve any issues to correct the audit results. Very few agents or agencies understand and engage in this audit review process.
Often times business owners want to be excluded from work comp coverage under their policy. Many states have specific rules and required forms in order to properly execute the exclusion. Its not uncommon for business owner to wind up with big audit bills because another agent didn't properly advise them on how to exclude owners from the policy.
What Does Blocking The Market Mean?
When an insurance agent blocks the market it means they have sent your workers comp application and loss details to all of their insurance companies in order to prevent another agent from submitting without an AOR letter. The ugly truth is that some agencies do not have your best interest in mind and will not always show you the lowest cost insurance quote at the time of your renewal.
There are a few reasons why an unscrupulous agent might block the markets and then fail to present the cheapest prices or lowest rates on coverage. Different carriers pay different commission percentages on premium, so an agent may be greedy and want the deal that pays the highest commission. An agency may also favor a specific carrier because they are trying to bump up their book of business with a particular insurance company to meet production requirements. You have the right to ask for copies of all your renewal offers to make sure you are being represented ethically.
The original agent who submits a businesses application for underwriting is considered the incumbent agent so no agent of record letter is required. If you've never been asked to sign a Agent of Record or Broker of Record Letter its more than likely because you have never had a conflict with your current agent or you've dealt with competing agents who had separate and distinct insurance companies.
Each insurance company has its own process and requirements for executing a Broker of Record change but the process is always similar. A few require a signed Acord 36 Form as its the official industry Agent/Broker of Record Change Form; however, most insurance companies will accept a simple Agent of Record Change Letter with the following elements:
Below are examples of the Acord and the Sample Letterhead:
Once an AOR is sent to an insurance company underwriter the insurance company will generally notify the current agent and sometimes allow them a 10-day grace period in which they have the opportunity to contact the insured and ask them to rescind the AOR. This requires a new document that reaffirms the original agent as the Agent of Record.
Once the 10-day grace period has expired, assuming no rescinding order was signed, the new agent and agency may work with the insurance company on behalf of the business. This included negotiating new and renewal quotes, issuing certificates of coverage and requesting policy changes.
A Word of Caution on Broker of Record Letters
While it sometimes makes sense to make an agent of record change for reasons we outlined above. It can also send the wrong signal to underwriters because too many cooks in the kitchen is a recipe for disaster. If two agents present conflicting info about payroll, class codes, or operational details an underwriter might feel like someone is gaming the system or misrepresenting the facts. Its possible the carrier could decide not to offer a quote or renewal in some circumstances.
Good independent insurance agents are the best way to find the most affordable insurance quotes. If your agent is doing a good job and your happy with your rates service then it might not make sense to do an AOR. However, if your agent isn't providing you with great service and competitive renewal quotes then consider selecting a new agency to represent you in the marketplace.
Get free workers' comp insurance quotes today and see if your business qualifies for lower rates and better service.
Changing insurance agents mid-term or during your annual renewal is an important decision. When it does become necessary to make a change, our workers' comp experts can help you with the Agent of Record process or we can work with you to find alternative insurance quotes for your business.
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We represent more than 40 insurance companies. More competition for your business helps us negotiate the lowest rates on coverage.
We're a National Insurance Agency.
Our agency is licensed in all states and we know how to properly cover your business no matter where your employees live or work.
Talk to one of our experts about your workers' comp and general liability insurance today.
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