First in a two-part series, this document by Rob Ekern explains what a Stewardship report is and provides a checklist of all the components you’ll need to assemble one. Used properly, the Stewardship report will help you retain your clients at renewal time, particularly when faced with such adverse conditions as higher premiums and increasing deductibles.
Brokers throughout North America are finding themselves between a rock and hard place. They’re having to give their clients a reality check on the state of the marketplace: higher premiums, larger deductibles, capacity problems, and general upheaval. Their explanations often come only days, hours, or minutes before the current program’s expiration — and in some cases, even after expiration. These discussions stun many clients. They feel betrayed, or at best angry, about the short notice — a feeling that doesn’t bode well for renewal.
How do successful brokers handle such situations? They don’t let them arise! They realize that no one can control the hardening of the market and that trying to hide this fact from clients will only make things worse.
Stewardship reports can provide an effective antidote for marketplace insanity. They offer a unique opportunity to reinforce your value to clients, while giving them quality information without the tension of the renewal process.
WHAT IS A STEWARDSHIP REPORT?
Here are the seven sections of a well-presented Stewardship report:
- Brief introduction to your firm — Include a history, your area of expertise, and team members.
- Service review of completed projects.
- Demonstration of past value — Show three ways your firm has reduced the client’s Total Cost of Risk (TCOR) over the past 18 months.
- Marketplace review — Provide your client with 'straight talk' about the condition of the marketplace for their specific industry.
- Demonstration of anticipated value — Show three ways your firm will impact the client’s TCOR over the next 18 months. Use the client’s balance sheet and strategic plans to demonstrate your value.
- Make commitments — Give the client a yardstick by which to measure you in the future.
- Obtain validation — Remember that your strategic purpose of the Stewardship report is to establish and maintain control. Without a validation from the client, you can’t ascertain your position.
Timely delivery of Stewardship reports allows you to greatly reduce the stress of renewals. If properly done, they prepare the client for marketplace turmoil and demonstrate the unique value that you bring to the table.
The proper execution of a Stewardship report is so vital that Part II of this document will focus entirely on that subject.