Despite economic headwinds, middle market companies are sustaining growth. They continue to add employees, introduce new products and services, and expand into new markets.
For many middle market companies, the combination of growth initiatives and changing market dynamics creates a range of new and often unseen risks. Agents and brokers can better serve their middle market clients by helping them identify, understand, and mitigate these risks through cross-selling.
When you cross-sell to middle market clients you provide an essential strategic service; namely, you help enable your clients to limit exposures that could hinder future growth. Cross-selling additional lines has several other benefits as well, including:
Middle market companies are moving forward in the face of numerous economic challenges and increased risks. In a recent survey conducted by Chubb and the National Center for the Middle Market (NCMM), executives of middle market companies identified the following top concerns:
To sustain growth, businesses are responding to these challenges with a range of tactics, including making investments in technology, ramping up hiring, and increasing training and employee development. These operational tactics, combined with growth strategies such as opening new facilities and entering new international markets, can give rise to additional exposures such as environmental liability, foreign regulatory risks, and cybercrimes.
Changing external factors have also created new and greater risks for middle market companies. For instance, the increase in the severity and frequency of weather-related disasters, combined with rising replacement and labor costs, can lead to greater losses and longer business interruptions. Basic commercial property policies may be inadequate—and cross-selling may help close gaps and level up coverage. Agents and brokers should also consider working with middle market clients to evaluate coverage limits in light of the increased costs arising from inflation.
All middle market companies maintain multiple essential and compulsory coverages—such as workers’ compensation and commercial general liability insurance —to manage the risks that every business faces. But many middle market companies face additional exposures depending on their industry, operations, geographic reach, and other factors.
Agents and brokers can serve as valuable partners to these companies by helping them identify and mitigate risks that are unique to their business. Examples of cross-selling are illustrated in the following three scenarios:
Scenario One: Professional Services
When Miami-based digital marketing agency Optivox set up offices in Brazil, Lisbon, and Sydney, the company exposed itself to additional risks related to international travel, new service contracts, and hiring employees in new geographies. Cross-selling opportunities include:
Scenario Two: Technology
Fast-growing San Francisco-based telecom business Chatwire is adding customers and opening offices around the globe. Its success has attracted cyberattacks and led to property theft. Cross-selling opportunities include:
Scenario Three: Manufacturing
Dallas-headquartered furniture manufacturer Quarter Craft expanded rapidly during the pandemic and continues to grow, adding new facilities in several states—and taking on new risks. Cross-selling opportunities include:
Agents and brokers looking to grow their revenues by cross-selling to middle market clients should seek out insurance carriers that provide a depth of products and services. Key factors to look for in insurance carriers include:
Insurance carriers may also offer strong sales support, provide robust technology tools, and make it easy to set up multiple coverages in a single package.
Middle market companies bring many advantages to the competitive marketplace, but they often lack the in-house resources of large multinationals to manage complex risks. This is where agents and brokers can serve as important strategic partners.
Consider reaching out to your middle market clients to discuss their growth initiatives, changes to their operations, and the evolving risk landscape. Following these steps will help you provide value to your clients and support cross-selling:
In-depth conversations can build trust and help your clients understand the value of identifying coverage gaps. With a strong risk management program in place, supported by an engaged broker or agent, middle market companies can move forward with greater confidence as they execute their growth strategies.
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This document is advisory in nature and is offered as a resource to be used together with your professional insurance advisors in maintaining a loss prevention program. It is an overview only, and is not intended as a substitute for consultation with your insurance broker, or for legal, engineering or other professional advice.
Chubb is the marketing name used to refer to subsidiaries of Chubb Limited providing insurance and related services. For a list of these subsidiaries, please visit our website at www.chubb.com. Insurance provided by ACE American Insurance Company and its U.S. based Chubb underwriting company affiliates. All products may not be available in all states. This communication contains product summaries only. Coverage is subject to the language of the policies as actually issued. Surplus lines insurance sold only through licensed surplus lines producers. Chubb, 202 Hall's Mill Road, Whitehouse Station, NJ 08889-1600.
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