Money-Savings

There are a number of “tricks” to help restoration contractors save money on their premiums. The following is a list of 11 little-known discounts that will help you and your company save on your insurance premiums.

In fact, your company may be already doing some of these things, but your agent may not have not informed you they can translate into premium savings.

(Click on any of the tips below for a full explanation)
Combining Policies
Did you know there are specialty insurance carriers that have put together package policies that will include all of your necessary coverages, including general liability, property insurance, and even auto coverage under one policy? Did you know that by doing so, you can save significantly on your premium?

Tip: Find an agent who specializes in restoration contractors so you can be certain you are aware of new insurance programs that may be available to your company.
Written Policies and Procedures
Written policies and procedures can help you reduce your premiums as well. Knowing how your company will respond to various situations with written documentation is a vital, often over-looked aspect that will lower your premiums.

Also, documented training procedures will help the underwriter feel comfortable with what employees are doing on the job and how they are being trained.

Tip: Provide a copy to your agent so that it can be properly discussed with an underwriter.
Staff Qualifications
Providing written resumes of the owners and key employees is another way to save money. Your employees have the know-how and experience; however, your underwriter isn’t aware of their expertise. The ability to show management experience within the company will make insurance companies more comfortable with the risk that your company presents.

Even for a well-established company, providing employee experience is still a great tool because of employee turnover. Consistently showing an underwriter that you have qualified individuals in your top positions will quickly translate into premium savings.

Tip: Provide written resumes showing employee experience to your agent.
Claims-Free
Providing a claims history showing that you have been without claims will greatly assist in decreasing your premiums. Especially for companies that have been in business for more than 5 years.

Here is the part that is often over-looked, though: most companies are going to have claims, and your ability to provide a written explanation of the claim along with your company’s response to avoid future claims is just as important.

Tip: Provide a claims history and written explanation of any prior claims.
Risk Management
Every company takes steps to avoid claims; however, very few of them document their procedures to demonstrate what they are specifically doing to prevent them.

The trick is to make sure those procedures are recorded in a clear, concise fashion that will help put your company in a better light. Your agent can help you discover additional areas where you and your company have taken steps to avoid risk and didn’t even realize it.

Tip: Find an agent that has a specialty and expertise in your industry that can point out the potential risks your company faces and the proper way to avoid them.
Know Your Property Values
Properly insuring your property is of vital importance; however, many companies will often just guess on the limits they need to cover their property.

Taking a full inventory of your property will assist you in two ways: 1. It will help you avoid overinsuring the property and overpaying on your premiums. 2. It will also help you avoid underinsuring your property, which would result in a penalty from the insurance company in the event of a claim (known as a coinsurance provision).

Tip: Take an inventory of the property owned by the company and provide it to your agent.
Mitigate Your Risks
Almost every restoration contractor has some sort of contract with a different entity. It could be a landlord, subcontractor, vendor, or client. How do you know, though, if the contractual language decreases or increases your risk? How do you know if you are obligating your company to pay for damages you never intended to?

Drafting a standard contract with specific wording, including hold harmless agreements, for the companies you work with, including your subcontractors, will not only help mitigate your risk, but it will also help you save money on your premiums. Collecting certificates with the proper requirements is also of great worth.

Tip: Ask your agent to provide some standard contractual wording that could be incorporated into your contracts (with your attorney’s help, of course).
Maintenance Logs
Keeping a log of when equipment is repaired can also help save money on your premium. Most claims involving property involve the failure of equipment that is in some type of disrepair. Showing a maintenance log to your agent will prove you are providing the necessary upkeep to your property, which can result in discounts to your company.

Tip: Provide a copy of your maintenance logs to your agent.
Understand Your Premium Basis
Knowing how your premium is calculated can help you save on premium dollars as well. Typical liability premiums are based upon 1 of 4 things: Gross Revenue, Gross Payroll, Number of Employees, or Square Footage.

Within each one of those areas, however, there are often portions that do not need to be included within the premium calculation. As you may suspect, though, the insurance company will seldom disclose where those savings can be found. So, unless you are using an agent that specializes in your type of risk, it can be very difficult to find out where you may have some hidden savings.

Tip: Use an agent that specializes in restoration contractors.
Acceptance of Risk
If your company has not had a recent claim, or if you are strong financially, raising your deductibles can be a great way to save money on your premium dollars.

Understanding where and how to raise your deductibles appropriately can be of great importance. Changes to certain deductibles may not translate into any premium savings but will provide more risk to the company, while changes to other areas may bring significant savings to the company with the acceptance of very little risk.

Tip: Talk to your agent about where you can accept additional risk by increasing deductibles.
Protective Safeguards
Installation and maintenance of protective safeguards such as sprinkler systems, fire alarms, and burglar alarms will also decrease your premiums, especially in buildings with high values or high occupancy.

In fact, the installation of a burglar alarm and fire suppression system can help decrease your property premiums.

Tip: Work with a qualified loss control representative and/or agent that will help guide you in the purchase of the right type of safeguard for your building.