By now, you’ve undoubtedly had plenty of first-hand experience running your dealership at historically low inventory rates. As you continue to assess operations and look for ways to manage costs, don’t overlook a unique savings opportunity—the chance to lower insurance premiums on your insurance for your lot inventory.
If you haven’t shopped your rates recently and your inventory levels are lower, there’s a good chance you are paying for coverage you don’t need. Depending on your state, climate, and other factors, you could save by adjusting your coverage levels based on your most recent inventory level averages.
A tighter standard: three-month rolling average
Look at inventory again in early spring
Consider self-insuring a portion of your inventory
What to look for in a broker
Brokers who specialize in auto retailing understand unique dealer needs and can source multiple coverage options. In addition, they can help to create healthy competition among insurers as they shop your coverage to various companies.
Look for transparency when selecting broker. Your broker should share which companies they’re comparing, as well as details about how they’re negotiating on your behalf. “They should be willing to show you starting and ending figures, so you understand what kind of value you’re getting from the relationship. Especially right now, with the market becoming soft and several players offering highly competitive rates,” explains Mr. Johnson, “you want to be sure they’re helping you take maximum advantage of any chance to lower your premiums.”