The case for total transparency

The article was written by Zach Materne and originally appeared in the January edition of Powersports Business.

As a dealer, you pride yourself on being transparent with your customers. You empower your staff to assist your customers in making the right decision by understanding their needs and offering guidance. Yet, when it comes to your own business, especially your insurance program, transparency can feel like a double-edged sword.

I get it. As a former dealer myself, I’ve been in your shoes. Sharing every detail – revenue, employee counts, dealer plates, building value, inventory, and yes, even your current premium – can feel risky. You might worry it will limit your negotiating power or expose you to potential drawbacks.

In my current role as a commercial insurance consultant, I’ve learned that withholding information often works against you. Total transparency isn’t just helpful; it’s essential. It empowers your broker to secure the best possible coverage and pricing while avoiding inefficiencies that could leave you vulnerable.

Transparency matters

Insurance isn’t just about finding the lowest premium; it’s about protecting what you’ve built. Every piece of information you provide helps your broker understand the unique risks your business faces and allows them to act as your advocate in the marketplace.

Here’s how transparency benefits you:

Premium

While premium is often a primary focus, it’s only one component of a comprehensive insurance strategy. Sharing your current premium gives your broker a benchmark to evaluate which markets are viable options. Many carriers have minimum or capped premiums, and knowing your current costs allows your broker to target markets that are effective players for your renewal.

Transparency about premium also helps your broker leverage competitive pressure among carriers, ensuring they bid aggressively for your business. But this only works if your broker has the full picture, premium included.

Coverage

A low premium with incorrect exposures could mean you’re paying more for less coverage. For example, if your policy doesn’t accurately reflect your inventory’s peak value, updated property values that reflect inflation in construction costs, inaccurate revenues or payroll or the correct number of dealer plates in use, your rate might seem lower, but the coverage won’t align with your actual needs. In the event of a claim, this discrepancy could leave you severely underinsured or subject to additional cost during a premium audit.

Exposures

Your exposures, like revenue, employee count, and property values, drive your premium and shape your coverage needs. Providing accurate, updated information allows your broker to position your dealership effectively with carriers, demonstrating that you’re a well-managed, low-risk operation.

Avoiding a transactional approach

A transactional approach to insurance often leads to a transactional result. When dealers view their insurance renewal as a one-time negotiation focused solely on price, they limit the potential for long-term benefits. This mindset often results in:

• Inadequate coverage that leaves you exposed during a claim.
• Missed opportunities to secure better terms through strategic planning.
• Inefficient use of time chasing short term savings at the expense of long-term protection.

In contrast, transparency and an intentional strategy can transform your insurance experience. By collaborating with your broker, you build a relationship where they understand your business holistically. This enables them to advocate for you more effectively, target the right markets and structure a program that aligns with your goals—not just for this renewal, but for the future.

Save time and money

Being upfront from the start, you allow your broker to focus their efforts on carriers that are the best match for your needs, avoiding unnecessary roadblocks and inefficiencies.

Trusting your broker

Transparency requires trust, and that trust is built on a strong partnership with your broker. Your broker should be more than just a service provider; they should be your advocate, working tirelessly to protect your interests and secure the best possible outcome for your business.

When you treat your broker as a partner and provide them with a complete picture of your operations, you empower them to deliver solutions that truly align with your goals.

Final thoughts

Transparency isn’t about losing control; it’s about gaining a competitive edge. By providing your broker with the full scope of your business’s exposures, premium and operations, you’re setting the stage for better coverage, competitive pricing, and long-term peace of mind.

Insurance is a critical part of your business strategy, and total transparency is the key to making it work for you. Trust your broker, be open, and let collaboration drive your success.

This article was written by Zach Materne, a Property & Casualty risk consultant for Apiar Commercial Risk Management, LA Resident License #871096; Cell Brokerage CA LIC. #OG83985; NPN #14775635