Many contractors don’t realize how important it is to publish their insurance bid specifications each year. This will allow you to interrogate the market and save you a lot of money. This is true for Liability, Auto, Property, and Workers Compensation Insurance.
1. The bid specifications must include all information required by the broker to create a quotation.
Although it takes time and effort, it is well worth the effort. These specs are crucial in driving down insurance costs. It is simple to update them once per year after they have been developed.
Any broker can receive your bid specifications. Quality is measured by the absence of broker questions. You can ask questions and record the answers in your bid specifications.
Bid specifications should detail your operations, exposures and coverage. They must be kept up-to-date at least once a year.
2. Bid specifications Tables
Bid specs should include lots of tables. These tables could include vehicles, drivers and sales figures, as well as payroll costs, subcontractor costs, equipment and job history. We also covered your policy & loss history in Chapter 5. These tables can be set up in spreadsheets and are easy to modify. To help our clients stay organized, we use an online database.
Vehicles Year, make and model, Vehicle ID Number gross vehicle weight, location for garaging, cost, special equipment, loan number, lender names, and address
Equipment Year, make, model, item and Serial number. Current cost, value and year of purchase.
Drivers Name, license number, license state, birth date, date hired
Sales: Show five years of sales history by type of work. You can break it down by Residential vs Commercial, or remodeling versus new construction. The next year will be the same.
Subcontractor costs: Show five years of history by subcontractor cost, according to the type of work they did. The same variables can be projected for the next year.
Payroll Show five years of payroll history by workers’ compensation code. Display the average wage per class and the number of employees. The following year, project the same variables.
Your job history is very helpful. If you are able, you should present at least the last year. You can break it down by Residential vs Commercial, remodeling versus new construction. Report the jobs that you plan to do next year.
3. Description of Operation
Please describe what you do. This is where the job history report can really help you save words. Your web site probably already contains a detailed description of your operations.
3. Questionnaires –
Brokers must complete a lot of questionnaires. Complete them. Keep them and keep them updated each year. Don’t allow brokers to interview you and then give you the form. This is a common error. It is your right to have a copy the information given to you by insurance companies. Brokers shouldn’t tell you otherwise.
These questionnaires cover: Workers comp supplementals, Contractor supplementals, as well as standard accord applications for various lines of coverage. These questionnaires are a great way to start the right direction.
These documents may not be available from your broker. If this happens, you should have a conversation with your broker or look into getting a new broker. You can make an agreement with your broker to get the applications and give the broker the opportunity to quote. This will help you reduce your expenses.
4. Insurance
Brokers are proud to design coverage that meets your exposures. Ask for a detailed list of your coverage and how it can be improved. This should be done with every broker that you deal with. This is an effective way to create a coverage page for your bid specifications.
5. Localities
Brokers need to have a lot of information about each place you live (not just your job sites). So that you are sure the application for property coverage is correct and complete, ask your broker. Keep a copy of your application to reference in your bid specifications.
6. Certificates are required
In your bid specifications, make it clear what certificates you require. It can help you save a lot of time later by providing examples of the certificates you require, particularly the more difficult ones.
