Author, Jack Marrs, Associate Account Executive, Rancho Mesa Insurance Services, Inc.
Insurance renewals can be challenging for nonprofits, especially in the hard market of 2024, characterized by higher premiums, stricter underwriting, and reduced coverage from insurance carriers. Leaning on your insurance broker as the quarterback, a well-prepared submission can significantly impact the outcome of your insurance renewal, potentially leading to better terms and lower premiums. Nonprofits can work effectively with their insurance broker to build a comprehensive submission using the following strategies.
Pre-Renewal Meeting
Begin the pre-renewal process well in advance by meeting with your insurance broker at least 90 days before your renewal date to update expiring applications and discuss any changes in operations, such as new programs, major grants, changes in leadership, turnover percentage, and employee count, etc. Rancho Mesa meets with clients 120 days prior to the renewal date. This provides plenty of time to gather the necessary documentation, address potential issues, discuss a renewal strategy, and explore alternative options if needed.
Highlight Risk Management Efforts
Insurance carriers are going to favor organizations that proactively manage risk. Demonstrating your commitment to risk management can position your nonprofit as a lower-risk organization, potentially leading to more favorable insurance terms. Risk Management Strategies:
Safety Training
Regularly train staff and volunteers on safety procedures and document these sessions. Rancho Mesa clients have access to our proprietary SafetyOne™ Desktop & Mobile App, which allows you to manage your workplace safety program from anywhere, access important documents, and share job-specific and employee safety data as needed. The SafetyOne platform also includes tailored trainings to ensure proactive risk management.Large Claim Summary
For organizations that have experienced any number of large claims, it is best practice to provide a detailed summary of each claim. This should include exactly what happened and the procedures your organization has put into place to mitigate similar claims from happening in the future. Charity First recommends this approach because it demonstrates to insurance carriers that your organization is proactive about risk management.
Description of Operations
Providing a detailed description of your operations is crucial. This includes explaining how your nonprofit executes its mission, the specific activities and programs you run, and how these activities align with your organizational goals. A comprehensive description helps insurance carriers understand the nature and scope of your work, assess the associated risks accurately, and provide appropriate coverage.
Broker Expertise
Your insurance broker is a valuable resource and should have a deep knowledge of your organization’s insurance market and the specific needs of nonprofits. The broker should be ensuring that the submission is as strong as possible. The broker should be leading you throughout this entire process, informing you exactly what is needed and educating you on what is happening in the marketplace. The broker's role is not only to provide nonprofits with adequate coverage but also to ensure clients feel well-informed about what to expect for their renewal.
Importance for 2024 Renewals in a Hard Market
The insurance market in 2024 is particularly challenging for nonprofits due to an uptick in frequency and severity of claims across all lines of insurance. A hard market typically translates into insurance carriers engaging in more conservative underwriting, more restrictive coverage, elevated retentions/deductibles, and higher premiums. This makes it even more critical for nonprofits to present a strong, well-documented submission.
Building a strong submission for your insurance renewal in 2024 requires a proactive and collaborative approach. By starting early, maintaining open communication with your broker, compiling comprehensive documentation, highlighting risk management efforts, leveraging your broker’s expertise, and exploring alternative options, your nonprofit can secure the best possible terms for its insurance coverage. This strategic approach not only helps in managing costs but also ensures that your organization is properly insured.
To discuss your organization’s insurance renewal, contact me at (619)486-6569 or jmarrs@ranchomesa.com.