How to Buy Insurance for Your Nonprofit – Steps 6 & 7: Connect with an Agent and Apply

In an effort to save you some reading time (and to move on to more exciting insurance topics), I decided to knock out Steps 6 and 7 in one post.  The previous posts in the series can be found under ‘How to Buy Insurance for Nonprofits’ (see menu above)

Step 6: Connect with an Agent (or Agents)

In steps 4 and 5 you created lists of insurance agents and insurance companies. In step 6, you actually make the calls and engage an independent insurance agent (see previous posts on the independent insurance agency system).

Simply call. Have conversations. You’ve done some due diligence up front, so you’re not going in blind. Perhaps you’ve perused some other coverage posts on this site. You know your stuff. Don’t fear the insurance man!

Nonprofit Insurance - Steps 6 & 7

Nonprofit Insurance – Steps 6 & 7

What to expect when you call

There are a few things to consider when you’re calling, depending on the size, nature, and mission of your nonprofit. In addition, you should probably have a little inside knowledge on handling folks of my ilk.

  • If you’re a small nonprofit, be prepared to make a few additional phone calls. Some insurance agencies have revenue minimums for their insurance agents. Consequently, small nonprofits will not be a priority. Some of these agencies have a dedicated small business unit, but just be aware of where you might stand priority-wise.  You might need to take more time finding an agent that both knows nonprofits and can work with you.
  • If you’re a large nonprofit, be prepared to be seen simply as a large account vs. an account with a mission. If I were in your shoes, and partnership is vital, listen for both insurance professionalism and a heart for the nonprofit community. I’m not arguing that an agent has to buy your t-shirts and show up for all of your events, but in my experience, there can be differences in an agent’s approach. Just keep your ears open.
  • Do you like the person you’re talking to? Is your trust-o-meter giving you a good initial reading? First impressions are important.
  • Interview the agent: what’s their background? Have they worked with other nonprofits? With similar nonprofits?

Those are a few thoughts regarding your initial contact. You are the buyer. You are the client. You have the right to pepper us for info and background as much as we have the obligation to do the same…. which leads me to step 7

Step 7: Apply for Coverage (See Also – Provide Good Info)

This step can be touchy. I’ve worked with quite a few clients that are supremely nervous to provide financial information, risk management protocols, and other seemingly ‘private’ bits of information.

In addition, insurance applications are notoriously long and tiresome. I understand. None of us have time what with 75 emails a day and our smartphone addictions. But they are vital to getting the best numbers and to streamlining the quoting process.

Some suggestions for navigating the application process:

  • Provide complete applications: Don’t skimp. Please don’t skimp. If you have ever dealt directly with an insurance company underwriter, you’ll realize that the more vague and incomplete, the less likely you are are to get quick turnaround or the best pricing effort from the company.
  • Related to the last one, when in doubt, put your response in separate document or email: If you aren’t sure how to answer a question on an application, just write it out separately and make a note to discuss with your agent.
  • Request the most transferable application: Each insurance company has its own applications. Request the most universal one (or two) so you can save yourself some time. Some underwriters will accept competing companies’ applications. Others won’t.
  • Provide financials if needed: I would love to just say ‘Don’t question it, just do it,’ but I won’t. I will say ‘do it’, but you can question it if you want. The company is potentially staking $1,000,000 or more of its assets on the fact that you run your organization responsibly. P&L and Balance Sheets are destined to come into play at some point.
  • Not related to applying, but use the applications to review your own risk management. When you go through the process, you’ll detect what the ‘best’ answers are to questions regarding risk management practices. If you haven’t implemented certain standards, the application process is the perfect time to implement them.
  • Expect the quoting process to take time: While I appreciate the Flos and the Gekkos of the world, they create an unrealistic expectation for turnaround times for insurance quoting. You should expect (normally) at least a week. If you can allow for more time, it will only help you. If you need it quick, then just be clear when and why.

The biggest takeaway for this step is this:

Provide good and complete information. If you’re worried about how to answer a question or provide sensitive information, discuss with your agent.

Trust me, your agent wants you to be attractive to company underwriters. The more everybody knows up front, the better the chances are that you will get the best coverage and pricing options available.

Finally, take note of the applications and companies the agent references and uses. Do the names that you hear dovetail with the companies you found in your research in Step 5? This isn’t a deal-breaker, but it might add to your comfort level.

  1. What has been your experience with insurance agents?
  2. What questions do you have about engaging an agent and applying for coverage?
  3. What have been some barriers or difficult parts about the process for you in the past?

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