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Deadly Sin #1:
Buying your policy from an agent who does not specialize in
workers compensation insurance.
There are a lot of insurance agents out there, but
not everyone specializes in workers compensation insurance.
Fewer still specialize in apartment owner workers compensation
insurance. If you do nothing else, pick an independent agent
who specializes in apartment insurance. Ask to see his list of
current clients. Is there a broad spectrum of small, medium and
large clients? Does he specialize in your type of business?
How long have they been providing coverage for your kind of
commercial account?
Deadly Sin #2:
Underestimating your payrolls and not having an agent who will
check mid-year or quarterly to adjust your estimates.
Underestimating your payroll will get you big
additional audit premiums at the end of the year. One of the
biggest complaints we hear is “my agent didn’t have my payrolls
high enough and now I have this huge additional audit premium I
have to pay.” How can you avoid this from happening since you
don’t know at the beginning of the year what your payrolls will
be? The answer is simple, but many agents fail to perform this
simple task when working with their client.
Deadly Sin #3:
Overestimating payrolls and not adjusting them midterm.
When you overestimate your payroll, you are
essentially becoming the banker for your insurance company by
loaning them money in the form of overpayment of your premiums.
Let’s face it, if you’re like most apartment owners, your line
of credit at the bank is being used and cash flow is always
tight. So why loan your money interest free to your insurance
company? Your agent should be adjusting your payroll during the
year. It is much easier to pay your premium based on your
actual experience rather than “loan” you money interest free.
Deadly Sin #4:
Not having a safety plan in place.
Many, many apartment owners never take the time to
set up their own safety plan. This is not because it’s hard to
do, but their agent has never worked with them to see that it
gets done. If you use an agency that specializes in apartment
workers compensation, they will have the knowledge and
experience to show you how easy it is. They will guide you
through the maze and keep you from getting into “hot water”
because of the failure to implement a safety plan. Nobody wants
to have a loss, especially the injured worker. To them it could
mean a loss of income and maybe even their job or life. You
also lose the time of the injured worker.
Deadly Sin #5:
Not paying attention to past claims.
It is critical that you have a professional agency that will
monitor current and past claims for you. Claims affect your
experience modification factor, which directly impacts your
premium. If your agent diligently follows up on your claims
both past and present, they can be settled faster, fairer and
help you expedite the reduction or retention of your experience
modification factor. Many companies are short staffed and just
don’t review every claim as quickly as they should. When claims
are left opened your claim reserves can stay high when maybe the
claim in fact has been closed out. Other basic adjustments for
on going claims needs to be done or you could end up paying for
it through higher premiums. Don’t let this happen to you!
Deadly Sin #6:
Failing to report claims.
Not reporting claims sounds like something that should never
happen, yet it does all the time. Some apartment owners feel
that if they do nothing the claim will go away. Others think
that someone else will report it and have no system to see that
a claim is reported on a fast and timely basis. Failure to
report worker compensation claims can and does result in heavy
fines for you and your insurance company. If you fail to report
it to the company, chances are they will come back after you for
reimbursement if you were negligent. When there is a loss of
time because of the claim, your insurance company or any future
insurance company will look unfavorably at you and either cancel
you or substantially increase your rates. If you suspect fraud,
the sooner your company’s adjuster needs to become actively
involved with the claim to prevent further damage to you. They
need to investigate the loss and talk to those involved before
anyone leaves or forgets what happened. Don’t wait until the
claim has been paid before you say that you believe fraud is
involved.
Deadly Sin #7:
Not having your agent present you with alternative quotes at
renewal.
Let’s face it you’re a busy owner and have lots of details to
keep on top of. Your agent needs to present alternative renewal
quotations without your having to ask for them. This is a
service that should be included. Have you been getting
comparison quotes on each renewal date without being asked, or
is this another detail that you need to remember. Voluntary and
proactive action by your agency is necessary for you to be free
of this all important aspect of your workers compensation
insurance.
Those 7 Deadly Sins to Avoid When Buying Workers Compensation
Insurance need to be address now. Our expertise in the
apartment insurance business will make sure they don’t happen to
you.
Please contact PHD Insurance Brokers, Inc. at:
(800) 640-4743 or (714) 534-6310
Or
Fax (714) 543-2943
Or
E-mail
Info@phdinsurancebrokers.com
Or
Visit our website at
www.phdinsurancebrokers.com
Sincerely,
Leland J.
Hendrie, CLU
Author,
Speaker, and Consumer Advocate
License
#0462338
© 2006,
Leland J. Hendrie. The reader assumes all responsibilities for
his/her own actions in regards to any items discussed in this
report. Adherence to all applicable laws and regulations,
federal, state and local, governing the use of any product or
service described in this report in the US or any other
jurisdiction is the sole responsibility of the reader. The
publisher and author assume no responsibility or liability
whatsoever on the behalf of the reader of these materials. The
reader is encouraged to consult directly with his/her insurance
professional. |
