By ROSEMARY ONUOHA
Have you been in need of insurance cover but ended up confused on what type of insurance to take? Have you had to make a claim from an insurance company but don’t know how to go about it? Then you need an insurance broker.
Insurance brokers act as intermediaries between clients and insurance companies. Clients may be either individuals or commercial businesses and organisations. They use their in-depth knowledge of risks and the insurance market to find and arrange suitable insurance policies and arrange cover. They act in the interest of their clients and offer products from more than one insurer to ensure that their clients get the best deal.
The job of a broker
Insurance brokers obtain raw data from layman customers and fill in the complex forms which insurers need in order to thoroughly assess the risk they are being asked to underwrite.
The broker also assists prospective insureds with developing risk management strategies appropriate to their risk profiles. They work with insureds to find out what kinds of risks they regularly encounter, and educate insureds about what policies are available for each type of risk.
Insurance brokers also may help insureds obtain multiple layers of excess/surplus lines policies from different insurers over a primary policy, and can work through scenarios for reducing premiums with deductibles or self-insured retentions. For most individuals, multiple layers of insurance coverage are unnecessary, but they are an essential component of risk management for large businesses and wealthy individuals.
Insurance brokers play a significant role in helping companies and individuals procure property and casualty (liability) insurance, life insurance and annuities, accident and health insurance.
For example, brokers play a significant role in helping small employers find health insurance, particularly in more competitive markets. Brokers provide services beyond procuring insurance, such as providing risk assessments, insurance consulting services, insurance-related regulatory and legislative updates, claims assistance services, and helping to resolve benefit issues.
Retail and commercial insurance brokers
Retail insurance brokers usually arrange insurance policies for individuals or companies and deal directly with them. Policies range from motor, house, travel or health cover for individuals or property to employer’s liability and public and product liability insurance.
Commercial insurance brokers deal with high value and more complex insurance cover in areas such as marine, aviation, oil and gas and financial risks.
Having a good broker
In Nigeria, insurance brokers are registered by the Nigerian Council of Registered Insurance Brokers, NCRIB, which is then regulated by the National Insurance Commission, NAICOM. A broker must be registered by the NCRIB before he can be licensed by NAICOM.
Accordingly, there is need for you to deal with a registered insurance broker who has been certified by the NCRIB to operate in the insurance sector. Negligence on the part of insurance brokers can have severe effects upon clients when they discover their insurance coverage is worthless, which in turn illustrates why retaining a competent insurance broker is so important.