This article is just one of many tips that can help business owners save a lot of money on their business insurance. We will be discussing loss runs today, which are crucial for any business owner who is looking to save money on their insurance. These reports are also known by the name policy history reports. However, they are commonly called loss run. This information applies to all business insurance types, including general liability insurance for contractors.
What are loss runs? A loss report is simply an insurance company’s listing of claims for a specific policy. It should list the policy number, effective dates and each claim. It should also include the amount of premium paid.
Why are they so important? They are a key reason why large amounts of money can be overpaid if they are not available at the right time. No one can provide accurate quotes if you don’t have your loss runs.
What makes it so difficult to get loss runs? They know that their clients can’t get competitive quotes without them. They rarely give clients their quotations voluntarily to avoid unwanted competition. Brokers will often delay giving loss runs to clients and take control of your renewal. Brokers may not be able get loss runs for policies purchased through another broker. Mishandled, the critical task of capturing current valued loss takes place 90 days prior to your renewal routinely. This costly mistake can lead to unwelcome crises as renewal approaches.
What is the solution to this problem? Collect and organize all information required to protect your loss runs. A spreadsheet should be kept that lists all your policies, as well as all policies you’ve had over the past five years. As you can see, the table headers are in a row across top.
Date of Inception – When did the policy begin?
Expiration Date: When did the policy expire?
Insurance Company – The exact name of the insurance company.
Record the policy number accurately.
Premium – Use final audited prime.
Total claims paid = Actual amounts paid by the insurer
Total claims reserved – sums not paid but held aside in anticipation of payment
Total Claims Incurred – The sum of all claims paid and incurred. Types of coverage – Auto, Property, Liability, Liability, Liability, Liability, Liability, Liability, Liability, Liability, Professional Liab and Workers Comp
Loss Run Contact – Name, fax and email address for the person publishing the loss ran.
Loss Run Value Date.- This is the date it was valued according to the loss report.
This can be done by asking your broker. You can declare an emergency if your broker is unable to provide this information. This information is crucial for your broker to manage your renewals. This information should be provided to you by your broker. It is best to do it before your next expiration.
You would like the policy history rows to be sorted first by line, then by inception dates. In this way, you can see 5 years of policy history for each line. You can add the claims and premiums for each line to calculate how much money your insurance company is making. It’s usually quite a bit.
Summary: The main reason you pay too much for business insurance is because you don’t get your complete loss runs on the due date. Without current loss runs, it is impossible to accurately quote your insurance. You must get them each year, 60-90 days before your expiration dates. You will avoid these costly mistakes if you follow the steps I have described.
1) Allowing your broker believe that he/she has the sole right to renew your contract. You can get quotes from anyone if you have your loss runs. They are not required.
2) A missing loss run can cause a crisis in the last-minute. An underwriter might pull a quote due to a missing loss run, which could have saved you some money.
3) Being ignored by underwriters who see your requests for quotations without loss runs as incomplete.