Insurance providers offer peace of mind and protection against a variety of concerns. To many businesses, insurance is simply required, but some see it as a true benefit. Depending on an organization’s risk exposure, several forms of insurance are available. The level of insurance required of a business is determined based on a number of factors, including industry and state.
Insurance Information Institute, Inc. (III) explains that to cover small businesses, insurers often combine a number of plans into a package that is sold as a single contract. Commonly, a general Business Owners Policy (BOP) is adopted. This policy comprises of coverage for major property and liability risks as well as additional items into one package. III notes that the term BOP refers to insurance policy language developed and maintained by experts at the Insurance Services Office.
In addition to BOP, business owners look to a variety of customizable and specialty insurance policies based on unique scenarios and risk factors.
Résumé Risk
OMP Consulting Group, LLC (OMPCG) provides resume writing and career coaching across all industries and experience levels. Victoria L. Kidd, certified professional résumé writer, executive director, OPMCG, admits she was completely uneducated in business insurance when she first started examining providers for her company. She eventually settled on general liability coverage as well as an errors and omissions policy—decisions made easy with the help of a Hiscox Ltd. agent.
The need for general liability coverage came at a landlord’s request. Kidd was trying to secure a lease on a new office space that required tenants to have general liability coverage. She needed a quote fast, and also needed help on deciding what type of coverage was best for the company. “Our only concern was to ensure that we were covered in the event that we had to defend the written materials we provided,” explains Kidd.
Covered by Hiscox since July 2011, Kidd sought coverage for about two months before deciding to utilize the insurance provider’s services. Now, she is a loyal customer. “The company’s service level and professionalism far exceed anyone else I had spoken with,” she notes.
Kidd explains that the Hiscox agent she talked with before signing on was knowledgeable, particularly compared to her experience with agencies from other companies. When she first approached the insurance provider, time was of the essence due to the impending lease agreement. Kidd explained to her agent the complete details of the business. The agent was thorough and asked about the full range of services OMPCG offered.
“I could tell the agent truly wanted to ensure that her recommendations were based on my perceived risk. Everything was handled with such a concern over my specific situation that I felt they were genuinely interested in seeing me succeed,” says Kidd. She adds that agents were quick to respond, processing the applications within a day.
OMPCG’s risk exposure is unique, as many résumé writers don’t carry insurance. Kidd says this is because there is literally no precedent for litigation in this area. “I double protect myself and my business. First with a detailed service contract and second with these policies,” she notes. Each policy provides an individual claim limit of one million dollars, providing the peace of mind needed for Kidd to continue to offer services. The company’s general liability policy costs approximately $350 per year. The errors and omissions policy runs at about $400 per year. Initially, Kidd was only looking for the required general liability coverage, but at the recommendation of the agent she accepted the errors and omissions policy as well. “It was an area I had never considered before,” she adds.
Kidd notes that at first it may be tempting for businesses to downplay what services they offer to try and get by with the bare minimum. But, in the long run, this could be a costly mistake. “Once you find an agent that is an expert, explain to them the nature of your business. You’ll gain insight into risks previously unrecognized,” she suggests. Make it a point to ask potential providers if they perceive any risks that were previously unidentified.
Second, it is important to shop around by asking other small business owners for recommendations or open source searching. “Other business owners are more than willing to provide information regarding the service providers they use. Many even share how much you should expect to pay,” adds Kidd.
After the initial process of quoting and finalizing coverage, an agent and provider that offer top-notch customer service is essential. Many small business owners don’t always have the time to connect and follow up with agents during normal business hours, so phone and email support is important. Kidd notes that she uses phone support. While OMPCG hasn’t called in any claims, they did need to change the bank account on file. When the call was placed to the agent, the representative expeditiously answered the call, made the adjustment, and confirmed the changes via email.
The level of expertise and customer support Kidd experienced with Hiscox is an ideal example of a proper relationship between the insured and the agent. “Hiscox contributed to our success in that I needed a policy that provided exceptional coverage at a reasonable price. They offered that,” concludes Kidd.
Concrete Coverage
Thompson Concrete LTD is a full-service concrete company offering turnkey service to its customers. The business is proud of its ability to handle every detail of large and complex concrete projects. Located in Carroll, OH, its operations include concrete, poured foundations, flatwork, decorative concrete, and excavation. The business is 50 percent commercial concrete, 30 percent residential concrete, and 20 percent excavation. The company employees 100 based out of one location.
Scott Thompson, owner/operator, Thompson Concrete, says the company has an excellent relationship with its Nationwide Mutual Insurance Company agent, Dave Bradley. They moved their insurance to Nationwide in May 2011. “Bradley is a professional business agent who I have known for ten years,” recalls Thompson. As a business owner familiar with bid processes, Thompson was focused on price when it came to insurance. “This past year, Bradley helped me understand that while price is important, there are other areas of my insurance program that need to be addressed.”
Thompson notes that through his agent, Nationwide has protected his entire operation. “The Nationwide team helped me see that my actual insurance policy is only part of my insurance program. The services and risk management programs are just as important and ultimately make me more profitable,” he explains.
For instance, Thompson Concrete’s trucks, excavation, and everyday operations present potential liability exposure. Safety is a major focus. Thompson notes that Nationwide brought risk management services to the business, ultimately generating cost savings. “We operate on slim margins in this economy and the price we pay for our insurance impacts our bottom line. So, while price is important to me, what Nationwide brings to the table on service and risk management is vital to my decision to do business with them,” he explains.
Thompson’s Nationwide agent brings a team of professionals to the table, including underwriters, claims people, and risk managers. Together, they were able to illustrate the insurance needs of Thompson Concrete to make the company more profitable. With the help of Bradley at Nationwide, safety programs were implemented into the business that benefitted the bottom line profit. Some of the advantages provided were risk management site inspections, driver safety training and programs, and assistance with background checks at a reduced cost to the business.
Prior to signing on with Nationwide, Bradley went through all of the coverage plans with Thompson Concrete. Two areas with assumed appropriate coverage were business income and business auto. Several major gaps in coverage were identified, which would have caused definite problems if not corrected.
Thompson notes that his business presents unique exposure because it offers very large, costly concrete forms. With the assistance of his team field underwriter, Rick Michalak, Bradley provided replacement cost coverage. “This was important to us because these forms are typically not found in the aftermarket. We felt that Nationwide was able to address our specific coverage needs,” says Thompson.
While online and phone support is available through Nationwide, Thompson conducts most of his business with them face to face through his agent. Bradley meets with Thompson or the company’s office manager at least quarterly and often sees them more than that.
As far as claims processing, at press time a Thompson Construction truck was hit by lightning. Thompson’s office manager reported the claim to Bradley as well as to the claims hotline. “I have to say the claims process is smooth and I am pleased with how it was handed. They were professional and prompt,” notes Thompson.
Thompson encourages small business owners to not be complacent with their current insurance program, as it is a vital part of business. “One bad loss can jeopardize your business if you are not adequately covered,” he explains. Businesses should seek an agent that is professional and understands the company’s needs.
Overall, Thompson notes that through Bradley and his team, Nationwide does an outstanding job at meeting the company’s daily service requirements and anticipating future needs. Communication is consistent. Regularly scheduled reviews of its current insurance programs address coverage plans, claims, risk management programs, and any changes that take place for the business.
