AN INSURANCE COMPANY IN TROUBLE: Agents
& brokers know that when the premium finance companies refuse
to loan on a carrier's policies, they've seen something they don't
like. Failed insurance carriers are a serious threat to premium
finance companies, so they monitor carrier health very carefully.
Although premium financing is usually not a good idea, merely
asking about availability can be wise. Another red flag goes up
when the excess insurers refuse to write over a carrier's primary
YOUR AGENT'S INFORMATION RESOURCES:
almost always free. Driving records on your employees are
routinely ordered when you supply a list of names and license numbers.
(And Fair Credit Reporting Act compliance.) The information
can give you an early "heads up" about people with problems.
Certain criminal offenses may appear on these records.
YOUR INSURANCE COMPANY'S BENEFITS: Your
workers' comp insurer usually can provide you with a wide variety
of safety programs, literature, documents, accident kits, posters
and other materials which would otherwise cost money to buy. Many
of these things are state or federal regulatory requirements you'll
be fined for missing. Your insurer will usually keep up to
date on OSHA changes, rules, etc. Commercial vehicle insurers sometimes
offer useful accident kits for placing in your trucks.
records on disk, photos, inventories, etc. which you maintain for
insurance purposes can be stored for free in your agent or broker's
offices, as long as they do not occupy a large physical space. You
broker may be willing to keep custody, as it makes his job of tracking
your values much easier, not to mention proving loss if needed.
OLD POLICY RECORDS: Commercial
insurance policies can occupy a lot of file space. In discarding
expired policies, tear off just the typed face pages which list
policy number, policy period, limits, forms, etc. That usually
means only 2-3 sheets. Your agent and/or the carrier has all
of the forms for reference & regulations require them to hold
everything for years.
time you suffer an accidental loss or unexpected claim, call your
agent, WHETHER YOU THINK IT'S COVERED OR NOT. You could
be pleasantly surprised. Business insurance history is full of cases
where insured property was replaced or insured lawsuits answered
without so much as a call to ask. Insurance carriers must
worship these policyholders who make impulsive assumptions about
A LEGAL DEFENSE WITHOUT INSURANCE: Carriers
regularly put up a legal defense on behalf of policyholders whose
liability claims are not believed to be covered. The legal
system has historically exacted painful revenge on insurers who
wrongfully denied a defense, and insurers then resorted to offering
legal counsel "Just in case." This has come to be
a sort of legal hedge bet by insurance companies, calculated to
avoid worst possible results when they deny coverage. This
may be expected when an insurer is not entirely confident in making
a coverage denial stick. You would typically receive a "Reservation
of Rights" letter from the carrier, citing various bases for
potentially denying insurance, notice that you may be pursued later
for the recovery of costs, amounts paid out, etc., and offering
you legal counsel or options.
CHEAP MEDICAL/LIFE INSURANCE FOR PRINCIPALS:
your business is incorporated, you may have the option of accepting
or rejecting coverage under the workers' comp insurance as a principal.
(Depending on your state's rules.) Depending on the rate you
pay, electing to be covered under workers' comp can be the cheapest
form of supplemental medical-life-disability money can buy.