What do you do when you have the perfect insurance company to match your needs, but not the perfect Business Insurance agent? Or maybe you’re not sure about your insurance company and not happy with your agent? This comes up a lot in the Insurance world, so what is the solution? An Agent of Record (AOR) or a Broker of Record (BOR). It’s a form that you, and your future agent, fill out and submit to the insurance company. Below are some things to consider when considering an Agent of Record for your Business Insurance and the process to have it completed.
Insurance companies typically will not accept an Agent or Record mid-term. Meaning, they must be submitted to the company near your renewal/expiring date. In most cases, no earlier than 90 days and not after the renewal/expiring. Each insurance company is different and may require different information. Most will require the form is done on company letterhead, though.
Once filled out and submitted, the insurance company is going to notify your current agent that you’re essentially requesting a new agent. For an example of what an Agent of Record Form looks like, please see below. They will typically give the other agent (your current agent) an opportunity to contact you to make sure this is what you want to do. It’s called a rescinding period, which is usually 5 days. During this time period, you might get a call from your agent asking you what they did wrong and beg you not to leave them. This might sound funny, but at this point, are you prepared to divorce your agent because that is what you’re doing.
Once completed, your new agent will have full visibility of the policy. This is a great time to do a policy review and is a great way to get to know your new agent and get their recommendations. I suggest getting together over coffee or lunch and sitting down together. Maybe the current policy isn’t right for you, or maybe things have changed since the inception of the policy. Policy reviews after the AOR can uncover things like, lack of property coverage, wrong locations and even businesses that have been classified wrong.
The Agent of Record process doesn’t happen overnight, so you will need to have patience. Insurance companies may have rescinding periods of 5-7 business days. Then it can take several days for the agent to get full visibility of your policy. If you’re not happy with your current agent, and not happy with your insurance company, I still recommend going the Agent of Record route. This will allow your new agent to do a side by side comparison. Maybe there's nothing wrong with the insurance company and the policy fits your current needs. I’ve had cases where the insured thought they didn’t like the insurance company, but it turned out the agent had extremely poor communication skills. For example, an insurance company conducted an audit and found the insured wasn’t classified correctly. They re-classed, which caused a re-write. It turned into a billing nightmare and lots of confusion. All the while, the agent never communicated any of this to the insured.
If you have any questions about the Agent of Record process, or have Business Insurance questions, please let me know, I work with a lot of businesses in the Austin, Cedar Park and Round Rock area. I'd love to meet you for coffee or tea and hear about your business. As always, thank you for taking the time to visit the site.
Commercial Insurance Agent
General Liability Insurance is a type of Business Insurance that's a must for all companies these days. It can provide the extra coverage needed to ensure your business is safe in any unfortunate event. It provides coverage for medical expenses, damages, and attorney fees, that your business is legally responsible for. General liability is often combined with a Business Owners Policy, but it can also be available to purchase as a solo policy also known as a monoline policy.
General liability insurance can help protect your business and your livelihood. Just one accident can be enough to result in a lawsuit that could end up costing more than you are able to pay. General liability insurance has many coverage options that can be tailored to fit the needs of any business. All of these coverage options provide coverage for different situations, including:
General Liability Insurance can cover many exposures. I have made a list to give you a good understanding of how it might help your business against certain exposures.
Premises Exposure: When there is ownership or occupancy of property (the premises). This type of exposure is also known as "slip and fall". If you are signing a lease, and your landlord is requiring insurance, this is probably why.
Operations Exposure: This is usually associated with manufacturing, processing, or contracting. An example would be a contractor paving a road. If there is injury or property damage as a result of negligent construction activity while the project is underway, this would be operations exposure.
Products Liability Exposure: When someone is injured by the product. An example would be if you were using a hammer and went to hammer in a nail and the hammer head came back and hit you or someone in the head and caused injury. This would be an injury arising from product liability exposure. Products liability exposure comes into play after the product is sold.
Completed Operations: Relates to items that are installed or constructed at a given location. An example would be a contractor that builds a deck. Maybe a railing isn't screwed in all the way or has faulty hardware. If someone is injured, this would be completed operations exposure. As the name implies, completed operations exposure exists after installation or construction and it's being used for its intended purpose. Some contractors might think insurance isn't needed after the job is complete. However, it's probably needed more once they walk away from the completed job.
Policy limits for General Liability Insurance can vary anywhere from $1,000,000 all the way up to $10,000,000 and higher. Sometimes the carrier won't write over a certain amount. If this is the case an Excess Policy or Umbrella would need to be purchased. Every business, large or small, should consider General Liability Insurance. If you have any questions about General Liability Insurance or any other type of Business Insurance, like Excess or Umbrella, please feel free to give me a call or send me an email.
Commercial Insurance Agent
When you have a Business Insurance policy it's not uncommon to have the insurance company conduct an inspection. It's actually written into the policy conditions that they have the right to conduct an inspection, and if the insured (business) does not comply, they (insurance company) can cancel the policy. These inspections are important in determining the insurability of the property and operations. I get asked about Business Insurance Inspections sometimes, so I thought it would make sense to write about it. The main question I get is, why are they doing an inspection?
It might seem annoying, or unnecessary, but it can be a good procedure to verify what you told the agent or broker is what was told to the insurance company. Think of it as the verification process for your insurance. This way everyone is on the same page from a risk perspective.
In addition to verifying information, they will also look for any safety concerns that your business might have. From a risk management perspective, it's another set of eyes looking at safety issues. However, the policy language clearly states that the carrier cannot be held liable for safety statements. Meaning, if they miss something, you cannot go back and sue them. This disclaimer has been included in the policy to protect the insurance company against such suits.
Also note that some insurance companies outsource inspections, especially if the insurance company does not have an office in that city. The inspector might not even come out and do a physical inspection. They might just do an interview over the phone to verify information on the application and ask some other questions. I've had some clients request that I come out when the inspector is there, especially if the inspector doesn't work directly with the insurance company and is an outsourced contractor doing the inspection. If this would make you feel more comfortable, be sure to request it of your agent.
The insurance company may inform you of recommendations or requirements that should be made, but please note, they are not required. If they do have such requirements, they must be completed within a certain time frame otherwise they might cancel the policy. If you have any questions about the inspection process or anything else related to Business Insurance please feel free to contact me.
Commercial Insurance Agent