A Peach of a Deal
Auto Dealer Saves 25% in P&C Premium by Leaving Direct Underwriter Model
For many years, Jim Peach Motors, a rural, three-franchise, two-location Alabama-based dealer was insured by a national direct underwriter.
In 2020, the dealer’s ownership asked Valent Group to conduct an in-depth analysis of their business’ property and casualty program. The evaluation was led by Paul Elliott, Vice President with Valent Group’s dealership vertical.
Valent identified the following concerns:
- Issues with named insureds
- Wind / hail deductibles for property and auto inventory
- Over / underinsured on property coverages
- Business income excluded auto sales
- Co-insurance penalty concerns
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The assessment was chaperoned by Jim Peach Motors’ risk manager, which provided an objective and knowledgeable lens through which to measure Valent’s expertise and process.
According to the dealer’s risk manager:
“It is abundantly clear this is an area of expertise for Paul. He fully understood the risks dealers are exposed to, addressed how to protect the dealer and offered a menu of services to further mitigate and address risks after the sale.
“Not only did Valent offer an improved insurance program, they also have given us access to their in-house loss control and claims support. And, above all of that, they saved us about 25% on our insurance premiums.”
Valent addressed the areas of concern and then marketed the overhauled program. Several carriers were asked to price the dealer’s property and casualty insurance, an approach that was new for the dealer and in direct contrast to their former strategy.
Before, the direct writer carried all the leverage—there was zero process to compete on price or service.
With Valent’s model, Jim Peach Motors stayed in the driver’s seat, choosing their own options and pricing structure from several partners.
Valent’s competitive risk management process provided Jim Peach Motors options among carrier partners, and recommendations for the best program coverages at the best price.
Ultimately, the dealer both increased their coverages and decreased their premiums by 25%.
The dealer was also awarded additional enhancements such as:
- Providing an aggregate deductible for inventory
- Properly calculating insured values for property
- Auto sales included in business income