A savings mind-set: choosing quality insurance over price

With a new year upon us and the January blues setting in, you probably have many clients tightening their belts and trying to cut costs. Often, insurance is the first budget item to be closely scrutinised as clients start shopping around for cheaper cover.

As you know, cheaper doesn’t mean better when it comes to comprehensive insurance. Now is the time to remind clients about the pitfalls of opting for cheap insurance and the cost of being uninsured. 

Here are four important points to highlight:

1. The value of insuring adequately

While many clients are cost sensitive in a tough economic climate, if asked what they value in insurance they will usually cite excellent value and great customer service. As insurance is an intangible product, it’s important to promote the value that your client will receive. This article gives great advice on explaining value vs. price but as an experienced intermediary you will know best which things will be most important to which clients. Some people care most about peace of mind; others about a smooth claims process or tailor-made cover.

Together, you can run through this checklist of what we think makes quality insurance.

• Solid track record: Quality insurance, the kind offered by Santam, will come from an insurer with a proven longevity in the business. Trusted by thousands of South Africans, Santam has been around for over 101years. We insure risks to the value of over R4 trillion and more than 80 of the top 100 JSE-listed companies trust Santam to protect their businesses. It makes sense to insure what is dearest to a client with the very best in the business.
• Excellent claims paying ability. Claims time is crunch time so Santam makes this process as simple as possible. Clients can log claims on the Santam app or online in just a few minutes. It also looks for reasons to pay, rather than not, typically paying 99% of all claims. Did you know that Santam spends more money on repairing vehicles than any other insurer? 
• A focus on customer service: Great client service is something Santam values above all, and also why we invest so much in supporting our network of intermediaries with unique client risk profiling techniques, on-going training, and an unmatched geographical presence and advice. Remind your clients of the value of a trusted intermediary who is just a phone call away. Someone who knows their family or business circumstances. It’s a relationship that can’t be compared with dealing with a faceless call centre agent.
• Value-added services: Besides quality insurance cover, ask a client if another insurer also offers useful (free) services? Are they rewarding a client’s loyalty with a no-claims bonus or other incentives? With Santam, things like 24/7 roadside assistance and a free locksmith service come as standard.
• Technologically advanced: As you know, Santam places huge focus on staying abreast of technological advancements, whether it’s educating our intermediaries about the Blockchain or the Internet of Things, crowd sourcing safety ideas, or investing heavily in improving our online platform and app.

2. The pitfalls of underinsurance

Underinsurance is a fact of life in South Africa. Every third South African home is underinsured by at least 30% and the South African commercial sector is also traditionally underinsured. In most cases the gap of underinsurance is highlighted at claims stage. 

Cover for Commercial insurance can be complicated and is best navigated with the help of an expert intermediary. As an intermediary, you play a crucial role in properly evaluating prospective client’s insurance risk from all angles and helping them establish the correct value of items to be insured, as well as deciding if business interruption cover is required. You can walk them through the common pitfalls of underinsurance – get more information here.

3. How to proactively manage risk to reduce premiums

It’s important to remind business owners they play an important part in managing risk and avoid costly accidents before they happen. It will not only help to keep their doors open but also potentially result in lower premiums. This could mean installing a telematics system for a fleet, a sprinkler system to guard against fire risk or power surge protection equipment.  

4. Working with an intermediary to reduce premiums

You might know that it doesn’t cost more to buy insurance from an intermediary but you’ll be surprised how many people believe the contrary. Therefore, it is important to explain your role to new prospects. You are not only saving them money – you are sharing your knowledge and risk management expertise with them. You will get to know their specific circumstances and offer discounts specific to them. For an intermediary, a client is a person or business with very specific needs – not just a policy number.

For more advice tailored to intermediaries, visit our blog for useful more articles.