Have You Reviewed Your Coverage Lately?!

As with most times in life, and especially in the business world, when you are selling something to a client, whether that be a tangible item, a service, or insurance protection, clients are keenly aware of the bottom line. Now while I, too, am concerned with the bottom line, I also adhere to the old adage that you get what you pay for. The reason I am bringing this up is because of a recent news article I have read and recent interactions with a new client and an old one. The article I was reading referred to an unexpected explosion that produced serious damage and, in fact, caused several deaths. In looking at this particular type of business and the potential of what possibly go wrong before this unfortunate accident, I just assumed they were properly insured with very large limits. According to early reports, their insurance limits were at the minimum. I understand trying to limit costs, but this was a business where there is always a better than average chance of some major incident happening. In looking at the business, even a low impact claim would be well over their limit, let alone covering the major accident they had. Did they know they were under-insured? Did no one point out that their coverage was grossly inadequate for their type of business? I’m sure that they wished that they would have had that conversation and coverage review before now! Recently, I signed up a new client whose business entailed several different aspects of contracting. They gave me a copy of their existing policy to review their current coverage and to determine if they were properly covered for all the different types of contracting jobs they were currently performing. After reviewing the policy, it was easy to see why the policy was so inexpensive. It was basically a handyman policy, and it did not cover almost all of the important types of work for which they needed coverage. After discussing and going over all the different types of coverage they would require, we found them the proper coverage and carrier that they should have had in the first place. It is understandable that clients look for the best possible price, but they also need to consider and make sure that their policy covers the types of services they are providing. Another area where clients do not do their homework is in reviewing the coverages for the subs they use. If you are concerned at all, by all means follow your instincts and check out their coverage to make sure that the service they are providing for you is properly covered. As an example, one of my general contractors was about to hire a roofing company to do a major commercial job. Their bid came in at a very favorable rate, and my client was about to award the contract to this roofing company until he did his due diligence in reviewing their insurance. It turns out that their insurance excluded commercial work and also torch-down work. In addition, this roofing contractor was going to use independent workers and not supply worker’s compensation insurance. Needless to say, my client found another Phoenix roofing company that had all the proper coverages and at about the same price. Even through the contract price was a little higher, my client was properly covered and didn’t have to worry that if something did happen there would be no coverage. If you have questions about your current coverage or if you would like our agency to review your current business insurance coverage, we would welcome the opportunity.