When working with an insurance underwriter in regard to your insurance, your insurance broker may provide a target premium amount. That amount may be related to a number you provide or it may be determined by the broker in accordance with what would be best for you, the customer. At other times, it may simply be that the broker asks the underwriter at the insurance carrier to provide the very best rate possible.
The takeaway point is that it is in the insured’s best interest to have a target. That is why, if you are shopping for insurance, your new broker may ask you what you have been paying in the past. This allows him or her to help determine a good target to pass along to the carrier. It maximizes the possibility that the carrier will provide aggressive and favorable pricing back to you.
In the end, you want a target that is not too high or not too low. Something that is too low may simply mean that the underwriter walks away and does not provide a quote. That is why an experienced broker can be your best advocate in gaining the best coverage at the right price.
“The takeaway point is that it is in the insured’s best interest to have a target.”