Why You Should Always Look Your Underwriter in the Eye

By Jennifer Sylvester from

Imagine for a second that calamity strikes your business, be it a catastrophic data breach, ruinous lawsuit or onerous regulatory fines. Would you rather navigate your company’s financial exposure and insurance coverage with a person you know only virtually or with someone you’ve met face-to-face?

Technology is a marvel; one that generally (if not always) makes our work lives more productive and accurate. But technology cannot provide the same sense of surety and ease of communication as having sat in the same room with the person upon whom you’re depending to mitigate risks in a critical moment. That’s why, regardless of enterprise size, any individual tasked with an organization’s risk management should meet at least once, eye-to-eye, with a representative of his or her firm’s underwriter.

Research supports this notion: People pay more attention to both verbal and non-verbal cues during in-person meetings, which facilitates communication and increases trust. Consider one representative study, undertaken by Kevin Rockmann of George Mason University and Gregory Northcraft of the University of Illinois. The two business professors compared the work habits and project outcomes of 200 collaborators. One group of study participants put their heads together in the same room, another group joined forces via videoconference and still another group collaborated via email. The results were unambiguous. "Face-to-face, people just have more confidence that others will do what they say they'll do,” Northcroft wrote in their findings. “Over e-mail, they trust each other less."

Trust, of course, is (or should be) a crucial factor in every insurance relationship, for all involved parties. That’s one of the main reasons why large financial service firms nearly always gather a group of competing insurance company executives in the same room when shopping for a new policy or evaluating a renewal. Such “underwriting meetings” provide firm officials with a platform to explain their business in detail, discuss obvious and “black swan” risks, and answer any questions the underwriters might have. Such a process doesn’t only help underwriters better assess a potential customer’s understanding of risk management but also allows them to judge the character and competence of a company’s leadership team.

And the greater the level of confidence, the more opportunities there are for insurance buyers to save money: As a general rule, underwriter confidence in a client’s management team can lead directly to lower premiums.

That’s why Crystal & Company strongly recommends that it’s midsize and boutique clients follow the lead of their larger peers and meet with potential underwriters in person, at least once. (An underwriter that isn’t interested in meeting face to face—no matter the size of your business—may not be the best partner in crisis.) This is even more of an imperative if the person in charge of risk management is doing so as a “second job,” e.g., in addition to the duties of, say, a chief financial officer or general counsel. In person meetings humanize what can often seem like a distant and impersonal bureaucracy, while also demystifying what is often a very abstract process for both sides. Indeed, we generally take this philosophy a step further, recommending on-site meetings both before and after a client signs an insurance contract. Our standard post-deal procedure is to convene the underwriter, along with the department head that will handle the company’s claims, in a meeting at the client’s office.

This approach conforms to a longstanding philosophy at Crystal & Company—which is as true as it is clichéd—that strong relationships are an essential part of the risk management process. Decades spent nurturing such ties means that the largest global insurance providers give personal attention to even our smallest clients. And when we suggest they join us in the conference rooms, factory floors, and storefronts of our clients, they happily take the time. They do so not simply because we asked, but because they know that trust-building today is good for business tomorrow.

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