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Terms of Reference (TOR)

A quality TOR is the most important tool in the kitbag of the broker who is successful at winning new clients. A TOR is a document (perhaps just an email) that both parties exchange, it details exactly what each will do during the process, when they will do it and what will happen once it’s been done.

Most brokers attacking new business don’t use a TOR, they do all the work and end up not winning the account.

A quality TOR forces the broker to have a ‘quality conversation’ with the prospect. When deployed correctly, the end result means that you have agreed (in advance) exactly what you need to do to win the client, the timing that you present your terms, the approach to the insurers and what will happen when you deliver your terms. In essence, it’s a pre-close. It flushes out those prospects that want you to do all the work, only to see your terms being supplied to the holding broker.

If the prospect isn’t prepared to sign the TOR, then it gives the attacking broker a pretty good idea of what the final outcome will be. Using a TOR therefore will prevent the attacking broker from wasting a lot of time and effort.

Those brokers who use a TOR tend to have better relationships with insurers, who tend to convert the majority of quotes they do and the underwriters will start to ‘look out’ for your quotes.

So, if you want to win more, save yourself time, get better terms from insurers and have them hungry for your business, then you should start to use a Terms of Reference.

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