Car Insurance Basics

9 Tips for Negotiating Low Premiums for Group Auto Insurance

March 10, 2015

The main benefit of a group auto insurance scheme is lower premiums. Every company that wants to get the best rates for its scheme needs to know how to negotiate for lower premiums. Otherwise, such a company may leave potential benefits on the table to the detriment of its employees. Here are some tips that will help you to negotiate the best deals auto insurance deals for your employees.

Tip #1: Start Early

The worst psychological state to be in while negotiating for anything, leave alone auto insurance, is being under pressure. Starting negotiations when your deadlines are too near will push you into a desperation cycle, and the insurance companies will sense it and cash on it.

Tip #2: Clarify your Needs

Ensure you fully understand what you employees need before you starts asking for quotes. Ask yourself, do your employees need a basic cover with optional extras? do they want a common comprehensive package?

Tip #3: Research Current Market Prices

Carry out some market research to find out which group covers exist in the market, and how much are other companies paying. Using tools such as insureafrika’s free online motor insurance quoting form can help you to know what prices to expect based on premiums available in the open market.

Related:Benefits Employees Enjoy from Group Car Insurance

Tip #4: Understand your Bargaining Power

You must know what power you have when going to any bargaining table. The volume of business an auto insurance company will get from you is your bargaining power. This includes the number of cars you need insured, and the cost of each cover. Compare yourself to similar organization to get a sense of what you can bargain for.

Tip #5: Fix your Maximum Price Point

Make a price commitment based on research. In this case, work out a deal that will actually give benefits to your employees that they cannot access on their own. You price commitment is not what you will present on the table. Rather, it is what you will not exceed - no matter what!

Tip #6: Make Insurance Companies Compete for your Business

Invite several companies to make their pitches, and make them aware of the fact that you are competitively sourcing for a motor insurance service provider. Each company will work hard to give you the best deal.

Related: The Benefits of Commencing Group Motor Insurance for Your Employees

Tip #7: Don’t Rush

Don’t rush the negotiations, and don’t be in a hurry to close, unless you have found a deal that meets or exceeds your needs. Sellers can smell a buyer who is in a hurry from miles away, and they will cash in on their desperation.

Tip #8: Make the First Offer

This tip is for the bold. In fact, some experts caution against naming a price because a seller may have been willing to go lower. If you choose to name a price, ask the insurance companies something like this, “what can you give me for this much?” This will enable you to negotiate on features and benefits, and not price.

Tip #9: Never Take the First Offer

In every competitive climate, sellers will quote a figure higher than they are actually willing to take. Even if the initial price is equal to or lower than your reserve price, always provide a counter offer and negotiate from there. 

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