Buying insurance is not an event, it’s a process that requires due care. Working with an insurance professional you trust, is just as important as the staff you interact with on a day to day basis. Colin Rooke and Paul Martin dive into this process in today’s episode of Risky Business.
Listen to the full episode here, or read the full transcript below
Paul Martin: Welcome to Risky Business Commercial Insurance with Butler Buyers. This is Business Commentator, Paul Martin and joining me in the studio today, our usual guest, Colin Rooke, the Commercial Risk Reduction Specialist, with Butler Buyers Commercial Insurance.
Today we’re going to not be so specific about an industry topic I think Colin. I just want to maybe get back to basics. We’ve been doing this show for a couple of years now and if one of our listeners were to join in part way through they might be asking , what are these guys talking about or why are they doing it? So I want to kinda get back to the very basics of why we’re doing the show. What is it that Butler Buyers is trying to communicate when you do a radio program like this? What are you trying to tell the audience, the business owner in Saskatchewan, what education piece are you offering them? Basically, why are we doing this?
Colin Rooke: Yeah and really good point. It’s nice to circle back and say what is the point? Why is Butler Buyers different? And, really, how did we get our start? What got us here? I was thinking about that and we’ve always done these sheets. We have these sheets that, they’re called common exposures. So, if you joined Butler Buyers and you didn’t know anything about insurance, whether you’re an account manager, producer or anyone looking to get into commercial, you’d say okay, well, give us a category and we have a sheet that will allow you to understand what are the greatest risks for that category? And we have these sheets and they get updated quite often.
Paul Martin: And these are per industry?
Colin Rooke: Yeah yeah per industry so you say, okay Hotel Operation, lets say we have a new producer that says I know someone that owns a chain of hotels and I say okay great well, lets start with the exposures and you know I thought back, well, why do we have these? What are we really doing? What these sheets mean and it’s the way they were compiled, it’s a list of every concern that the underwriters would have so its not something that you run to the client and say listen, I really want to work with your business, and I just thought of something. There’s a really good chance that you could be a victim of theft. That your guests could steal from you. They know this.
Colin Rooke: It’s not new and that’s not our competitive advantage. But, what it does, is, it allows us to learn, it allows us to write down and articulate, this is what the underwriter behind the desk is thinking when we say we want to present a new hotel to you. And so when we look at these sheets and you start thinking about risk management, the concern from the underwriter is, there’s all these items. Equipment breakdown, crime, premises liability, topics that if you’re in the business, you’ve heard before. Their concern is that the primary method of defence is going to be insurance. So, you’re a victim of crime, you put in the claim, the policy has to pay. That’s the starting place for the underwriter.
Colin Rooke: So thinking back to what does Butler Buyers do and a topic that we’ve discussed quite often is, our real end goal, I mean if you had to define what we do and how we do it, our job is to make our customers, better customers of the insurance market. The way we do that is looking at the concerns the underwriters have, walking our clients through our step by step approach to risk management, formulating a plan and then quite frankly, taking a primitive sheet and addressing every single concern that the underwriters have brought to us over one hundred twelve years of business and say you know, if you really want to be in control of what you pay for insurance, you have to have an answer for this stuff and our job is to work with you and have a real answer and the answer can’t be insurance if you want to pay as little as possible.
Colin Rooke: Taking us back to the absolute beginning, that’s how this was derived. Its saying, okay well, we’ve got to have a story and that story is going to improve the performance of our clients, but it’s going to create a better environment for our clients to save on insurance premiums.
Paul Martin: Well there’s about fifty different things that you said there that have got me, you know I could run off on a line but one of the ones that you commented, I think really caught my ear was, if insurance is the answer to all the questions, that’s really expensive.
Colin Rooke: Exactly, and again, you have an underwriter who says, okay my job is to create new sales but its also to protect the insurance company I work for. And if you don’t have a plan, if you don’t have an answer for these questions, again using the hotel example, liquor liability, if the underwriter goes into the situation thinking okay, there’s no controls in place to monitor how much alcohol a customer of the hotel is consuming in the restaurant, bar or lounge, then the likelihood of a lawsuit coming our way is high.
Now, I can sell you insurance to protect you against your liabilities but the pricing, you know if we’re talking price, the plan is going to reduce the price. What do you do to ensure that this doesn’t happen? Now, on a standard insurance application, there aren’t questions like this. They want to know your percentage of alcohol in comparison to rooms and food. At no point does it say, what is your approach to over-serving alcohol in your restaurant and what do you do when you feel a patron has had too much to drink? That’s our job.
Paul Martin: That becomes what you talked about. The story telling component here. Your job is to extract information from your client, be able to package it up present it to the insurance company, the underwriters you call them, and just make the best case for, at the end of the day, the insurance company doesn’t want to pay a claim. Right?
Colin Rooke: No.
Paul Martin: They want all their customers to pay a premium and never pay a claim. That’s their perfect world. So if you can give them customers who will never make a claim, I guess they don’t need to charge you very much.
Colin Rooke: Exactly, I mean you have to make the case that the only reason why they would need a lot of premium collected is because the likelihood, they feel, of having a payout, is quite high. I mean, their trying to make a profit too and if the premiums, or sorry, the claims payments exceed the premiums, their not making any money, so they have to very cognizant and careful of that. But the more risk we can mitigate, by working on that risk, or at least at minimum, appeasing the anxiety of the underwriter pricing the account, the less our clients are going to pay.
Colin Rooke: And you got to realize that your hotel chain for to use this example, might be the center of your world, but to an underwriter, if we’re dealing out of Toronto, they could have a portfolio of 10,000 hotels they deal with. You’re just part of the bunch and it’s our job to make your business stand out. It’s the story, it’s the plan and it’s addressing these concerns that does that.
Paul Martin: Now you evolve that this mechanism or this method that you’ve developed is methodology is this step by step risk assessment plan and that’s distinctly unique to you. This is your answer to this question, right?
Colin Rooke: Exactly. You know, it’s sitting down and saying, we need to have a conversation and together we’re going to build the argument, the rational, that we’re going to use the insurance companies to save our clients. What we’re not doing is leveraging the volume, you know, business we have with that insurance market. We’re not pulling favors. Our clients are earning it. We always say, if you put in the work, you’ll see the savings and this is part of that work.
Paul Martin: Well, I do want to dig into that. Just what sort of experiences you’ve had in terms of the savings that you’ve been able to generate, but, when I hear you talk about the step by step plan, and the thing I’m thinking, it all makes sense to me if you can delineate the story for me. Where I get kinda scared is the potential, if I were in business sitting in front of you, I’d say, man I wouldn’t know where to start to fill this out. That’s what you bring to the parade. You bring that experience and you have the step by step plan.
Colin Rooke: Yeah, I mean…
Paul Martin: Questions
Colin Rooke: Yeah, it’s a conversation and quite frankly. Again though the questions that we ask are based on our experience in compiling current, I’ll say existing risks and then coupled with new and emerging risks. So what has historically been a problem and then what problems are looming, and we address both. We say okay, when you hear hotel these are 15 items that you are going to be concerned about and we know that and here is our answer to each of those. And from a larger perspective, again we’ll talk things like cyber crimes are a liability, we know that’s on your mind as well and here’s how we are training for the future so if we educate our clients just for today we haven’t done our job, because of the nature of cyber crime changing so rapidly, so we have those conversations as well.
Paul Martin: All right, we have to take a little break. When we come back I want to talk to you about the savings that you’ve generated for your customers.
Paul Martin: You’ve been listening or you are listening to Colin Rook, the Commercial Risk Reduction Specialist, with Butler Byers Commercial Insurance. This is Risky Business. We’ll be back after this break.
Paul Martin: Welcome back to Risky Business Commercial Insurance with Butler Byers. This is Paul Martin and joining me is Colin Rooke, the Commercial Risk Reduction Specialist at Butler Byers and just before the break I said I wanted to explore, if you can share with us, when you implemented your step by step plan with a prospect or customer client and they really embrace it, they’ve done all the work, what kind of savings have you generated for them? What’s typical? What can someone expect if they were to go through this exercise with you?
Colin Rooke: You know, talking about savings, it’s really all over the map and there’s so many ways to save so, for example with a new client, we might have a conversation and we might be working with an existing policy and we talk about their level of risk tolerance, and we say looking at who you’re with now, you are probably with the right insurance market. They have expertise in your area of business. Our main objective is not to say, in order to save, we have to move markets. But then we have the conversations. Sometimes, looking at the information we gather, we go back to the existing market, we retell this story and we renegotiate based on new information.
Sometimes, looking at the information we gather, we go back to the existing market, we retell this story and we renegotiate based on new information.
Colin Rooke: I’ll say where that’s very evident of how important the information is. Is cyber crime coverage. If you give very little information, you will pay 5 times what someone, compared to a company that’s providing all the information, getting us all the information, working through a plan, committing to educating your staff on an ongoing basis, seems like a lot of work. But, when we’re saying, well, you can buy the coverage based on the assumption that you will use this regularly, versus you can put in some work, you can grow your business as a result, you can educate and train, and you will pay a far lesser rate. We have a lot of success with that.
Colin Rooke: But back to the original example of working within a policy, lets say we’re dealing with a customer that is fairly adequately priced as is. That does not mean we can’t make changes so, maybe your deductibles are far too low based on your level of risk tolerance. Maybe you’re sitting on $1,000, $5,000, $10,000 and we’ve done a show about big deductible programs but, if we have a conversation about the likelihood of disaster occurring, or your level of comfort with self insurance, in addition to telling that story in a better way, and our way of reducing property rates for example, if we came in and say we now understand a little more about our client and we want to start by saying, we want to look at $100,000 deductibles, that’s immediate savings and that’s based on a conversation of what do you do if there’s a small loss in your organization? That’s making immediate impact on an area of coverage without having any movement whatsoever. Before the work gets done, just based on a quick conversation. There’s other areas of coverage that we can remove entirely based again on the work we do and the conversations we have.
There’s other areas of coverage that we can remove entirely based again on the work we do and the conversations we have.
Colin Rooke: And then, as we do the work, as we formulate the story, that’s all part of the ongoing negotiations of shedding our clients in the best light possible.
Paul Martin: You know, I can’t help but think that, as I listen to you talk, that well, you know I’m a business owner. I could do that stuff. I mean, it all makes sense and interestingly it’d make me a better business as a consequence with probably fatten my bottom line plus you’re going to lower my cost of insurance so all of this makes sense. But then I come against this whole area of expertise. I buy an insurance policy once a year. You buy 10 a day. I mean, you got to be better at this than I do.
Colin Rooke: Yeah and you know and we are. Our day to day is risk management. We truly believe that and we practice what we preach. And so you’re busy running your business. We’re busy at the office worrying about risk. It’s our job to be on the forefront of what’s new and emerging. Or what’s existing. It’s our job to make our clients aware of what they need to be aware of. It’s also our job to provide solutions to those risks and work together as a cohesive unit.
Our day to day is risk management. We truly believe that and we practice what we preach.
Colin Rooke: You made a very important point. Yes, there are insurance savings that can and should be captured and yes if you work on risk, you will be in charge of the premiums you pay. But, the real end result is better performance. If we educate your whole company on cyber crime and I know I say that a lot but I quite frankly, I don’t think I can say that enough. If we educate every person in your organization, and as a result we can stop a phishing scam or ransomware or something that will cripple the system for days, costing the organization time and money, I mean if we can avoid that, it has such a bigger impact on the organization than just avoiding, or reducing premiums, you’re genuinely making the businesses that we work with, better.
Paul Martin: Coming to the conclusion that buying insurance is not an event. It’s more of a process. Is that fair?
Colin Rooke: Yeah it’s a really good definition and I think those that feel their taken advantage of, their overpaying, they don’t understand what’s happening or the pricing model or scheme, those are the businesses that it truly is just a once a year, it’s an event opposed to an ongoing relationship, and ongoing risk management relationship. The more we are in tune with the clients we work with, the better serviced overall our clients will be.
Paul Martin: So if I’m listening to this show for the first time and I’m hearing you talk about this and you kind of intriguing me a little bit, what are the steps I can take? What are next steps? How do I reach out to you? What do we do?
Colin Rooke: Give us a call. You can reach out to me directly and ask to set up a risk reduction workshop. We’ll go from there. We’ll explain the ins and outs. We’ll have the conversation. We’ll formulate a plan. And we’ll talk about next steps and what that looks like. The first step is to say to yourselves, is there a better way of doing this? Would I like some help? Some education? A partner in risk? And if that’s you give us a call and we’ll get started on a risk management plan.
Paul Martin: Just got a few seconds left Colin but it strikes me that one plan does not fit all either, right? I mean you started the show by saying we have these common exposure forms that cover industry by industry. I assume each step by step plans unique too?
Colin Rooke: Yeah, each plan is completely unique to the industry and really what’s occurring today. You wouldn’t see the same plan twice.
Paul Martin: You’ve been listening to Colin Rooke, the Commercial Risk Reduction Specialist with Butler Byers Commercial Insurance and as always Colin, not only does the time go by quickly but the insights you provide always continue to leave me with something to think about after our program. Again, thanks for joining us today. This is Paul Martin. Talk to you next time.