The right time to revisit inventory insurance rates

Industry expertise

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

“Many insurers continue to insist on using a 12-month rolling average for determining the average inventory levels. But given the circumstances, that model is outdated and inaccurate,” explains J. Travis Johnson, Auto Dealer Practice Leader with McGriff, Truist’s auto dealer insurance partner. “When we’re working with insurers, we make sure they stay in line with current market dynamics and offer you revised premiums based on a three-month standard,” Mr. Johnson adds. 

Look at inventory again in early spring

It’s important to revisit your coverage and premium expenses again in the spring as the likelihood of weather events (such as hail) ramps back up. While you have a chance right now to potentially save by adjusting your coverage, you want to be sure you go into any known bad weather season with adequate coverage.

Consider self-insuring a portion of your inventory

Many dealers insure lower-cost inventory through self-insurance structures. If this is something you’re able to do, it could help you lower operating costs. 

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.” 

Comparison shop for significant savings now

If you haven’t yet made it a priority to revisit your rates on coverages, it’s an ideal time to do so. Insurers are actively competing for business, and you might be surprised just how much you can save. A good broker can assess your unique business situation, communicate it to insurers who want to vie for your business, and secure the best deal for your dealership. 

Check out your savings on inventory insurance

Talk to your Truist Dealer Services relationship manager and see how Truist and McGriff can help you match your lower inventory levels with a lower cost of insurance.

Don’t miss out on lowering your lot inventory insurance cost

Ask your Truist Dealer Services relationship manager how McGriff Insurance can help you lower your inventory insurance rates.