By Scott Jacobson, CLCS
As an administrator, you also take on the role of risk manager. Your job is to deliver on the mission and vision of your law firm. Sometimes, that calls for being direct, patient, encouraging or decisive—and sometimes all at the same time. You take unrealistic ideas that are thrown on your lap and convert them to real world actions, allowing the impossible to become possible. This means your accountability level for the firm is paramount.
The challenge with being an administrator is that you need to clone five versions of yourself in order to complete all of your responsibilities with the utmost precision. Seeing how that is not possible, developing a reliable network of vendors is crucial to your success. Do you have time to stay up to date on all of the nuances of your company phone system? Do you have time to navigate the payroll system effectively? Do you have time to differentiate one insurance policy from another? Probably not. However, you do have time to make sure that the vendor you select has credibility with proven results. Relying on that vendor’s expertise makes you a good risk manager.
When it comes to professional liability insurance, selecting the right broker is equally as important as selecting the right insurance company, sometimes more so, and often times, the two go hand in hand. The right insurance broker usually delivers the right insurance company. With an understanding that you have options in service, you open yourself up to different ideas and ways your firm can achieve results. There is no right way to select your broker, but knowing that your options expand beyond just your premium will allow you to get more out of your malpractice insurance experience.
Product education is also important. This is a subjective approach that is unique to the broker. While some brokers prefer to ignore why one policy is more appropriate and focus on lower premiums, others will disclose everything, so you feel you are working together to accomplish a goal regardless of price. Education always comes down to what you want or need. Perhaps you have no idea what you need? That’s okay, too. You have every right to interview a broker to learn more about how they will be able to help your firm. Always inquire about the proposed short- and long-term goals in order to better understand their approach. Making sure your broker can explain your needs in a way you understand is the basis for a strong relationship.
Each brokerage has a different business model, as well, and finding the one that best suits your needs is equally important. You have two choices in the way of business models. You can work with a managing general agent (MGA) or pursue open brokerage. A MGA is typically a Fortune 500 brokerage who manages one insurance company. They can underwrite policies in their office on behalf of their selected insurance company. Conversely, open brokerage means that the insurance broker works with many different MGAs to place the law firm’s coverage effectively. While both models can prove beneficial, remaining independent is the only guarantee that the broker works for your needs instead of the insurance company. While a MGA can bring one insurance company to you, should something not be right with the program, you would have to leave the broker to get an alternate quotation. An independent brokerage would simply take you to a different insurance company without shopping the relationship with the broker.
So now that you have determined what you need out of your broker, and what broker is positioned well enough to provide it to you, the next decision lies in choosing an insurance company. Ask yourself the following questions: Is price the most important? Is insurance company rating? Are the limits or endorsements or payment options? Perhaps you have other insurance concerns at the top of your list. The most important traits that brokers need to possess is helping you to understand your needs, addressing any questions and providing creative solutions, while working together to generate results.
Your insurance company is a direct reflection of the strength of your broker. As an office administrator, the process of securing insurance can feel daunting, but it does not have to be. You and your broker are just two risk managers looking out for the same common interest…your firm!
Scott Jacobson, CLCS is Founder and President of Jacobson Professional Insurance. Jacobson Professional Insurance was awarded the 2017 Best Professional Liability Insurance Agent/Broker Award from the New York Law Journal. Over the past six years, Scott has grown Jacobson Professional Insurance from a start-up to managing over $3,000,000.00 in premium, while representing over 300 law firms in New Jersey and New York. Scott may be reached at [email protected].
