# Insurance Talk...Post your insurance questions here!



## Ben/Insurance

Post all of your insurance questions here to be answered by our resident insurance expert, Ben Palmeri. Ben is vice president of a leading independent insurance agency located on Long Island.


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## FreshGrounder1

Wondering who the big guys use for snow/landscape Business Insurance. I am currently with Builders Mutual, decent premium, but lots of constant paperwork and last week received in mail "Notice of premium audit". They had a date to come to my home tomorrow for a pre-scheduled audit and check all my paperwork for employees and subs. Is this a "norm" in our industry? Please advise. Been in business for 5 yrs. and never had a problem or claim.


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## Ben/Insurance

Our largest clients still go through audits and have day to day
issues that come up that require our attention. Usually,
they have their bookkeeping/accounting depts handle audits and a CPA firm handle more complicated ones. A good insurance agent should handle much of the related paperwork however so I don't know why you would be dealing with that. Ben


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## LopatLT7495

Best company to get plowing insurance through in northern NJ?


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## wewille

My insurance company does an annual audit. This year they claimed I owe an additional 17 bucks. Whats up with that?17 from me 20 from the next guy, sounds like a way to collect extra money. How do they compute the audits. They claim it is based off our risk, employees, types of properties we service, scope of our work, etc... What is the no bs explanation?


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## wewille

Also we have never had a claim up until this recent slip and fall which may or may not amount to anything...


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## Ben/Insurance

Lopat, if you are only removing snow and you are not a landscaper, mason, etc, Our snow only program will fit you nicely.
If you are a landscaper, or hardscape contractor that does incidental/seasonal snow removal, the best quality policy, IMO, is Merchants in NY, NJ. The coverages are exceptional, claim service is excellent, and the pricing can't be beat. Plus, with the Merchants policy, it's stable so their is no need to look around for insurance very year.
We are agents for Merchants. If you'd like a quote, feel free to contact me. 516-233-3515 or [email protected]
Ben


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## jomama45

What is the lowest an experience mod. can be for a Work Comp policy?


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## Ben/Insurance

Wewille, insurance carriers base the cost (called the premium) of insurance by determining what your risk (or exposure to a claim) is. For commercial contracting insurance, the more employees, sales, payroll, etc that you have, the larger chance that you will have have a claim. Your exposure increases. Let's not even get into what type of work that you are doing. That's another discussion. Their really is no other way for them to price their products fairly. They can't charge everyone the same price. To make sure they charged you fairly, the carriers perform an audit. Over the last few years, with the economy in the toilet, I have seen countless refunds due the policy holder because payroll, sales,or employee count was down. It's very rare to see the opposite these days but it does happen. That's the no bs answer.


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## Ben/Insurance

Jomama, I have seen mods down to .82 for the best run organizations but it is rare. That would mean a 18% discount on your WC premium! I don't think their is a basement on mods but in my 28 years practicing that's the lowest I've seen.
Ben


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## jomama45

Thanks Ben, that's what I was looking for. My exp. mod. continues to slip down, and is currently at .90, so I'm glad to hear it can still go down a bit. It's not a huge issue though, as I get rather large dividend returns every year as well. Knock on wood.............


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## Ben/Insurance

Jomama, that's great. You must be doing things right. Maintaining that mod is very important. You might want to consider hiring a WC advocate to protect and further improve the mod. They do great work and most don't charge you unless they are successful reducing the exp mod. Your agent should be able to recommend one to you that he/she works with.
Ben


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## Ben/Insurance

*The difference between truck insurance and general liability insurance*

I get lots of calls from contractors that question the need for General Liability coverage when they have a commercial auto policy also known as truck insurance. I'm happy to educate the forum community about it. The commercial auto policy is designed to cover your commercial vehicles (trucks). It provides your company with coverage for bodily injury and property damage claims resulting from their use. If you are plowing a parking lot and accidently hit someone or something with your truck, your commercial auto policy will respond. The General Liability (GL) policy, with respect to contractors, also covers bodily injury and property damage but only responds to claims from your premises or operations. You plowed that same parking lot and after you've completed your work, someone comes along and slips and falls on a patch of ice and decides to sue you. The GL policy will respond to that claim providing both a defense and indemnification if applicable.
I've really simplified things here and coverage requirements sometimes get very complex but that's a good start. Feel free to ask any questions or if you want to email me, you can reach me at [email protected] and I still talk on the phone if anyone is still intersted in communicating that way. I'm at 516-233-3515


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## grandview

Sticky time!


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## BossPlowMaster

grandview;1771539 said:


> Sticky time!


Agreed!
Sticky


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## andersman02

Stick for sure.

orrrrrr i could just keep this copied for the 10000 posts we have about non insurance operations.....


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## Sawboy

grandview;1771539 said:


> Sticky time!


This



andersman02;1772246 said:


> orrrrrr i could just keep this copied for the 10000 posts we have about non insurance operations.....


And this!


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## Ben/Insurance

Sorry guys, I'll ask the moderator to move it to the sticky.
Ben


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## MSS Mow

Great post!!! Thanks for posting! So many people do not understand the difference.


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## Ben/Insurance

*What is an additional insured and why are you being asked to provide this?*

Another question that comes up a lot is what is an "additional insured" and why is my customer or GC asking me for this. I'll keep things simple. Here is a good scenario. You plow snow and your customer, an office building owner, wants your general liability insurance to respond if they get sued due to someone falling on snow and ice in their parking lot that you plow. The way to accomplish this is by adding an "Additional Insured" Endorsement or rider to your GL policy. This "rider" extends your liability insurance to the party named on it. In this case, it's the building owner. While this building owner should still notify their insurance carrier of the trip/fall, they will now pursue your insurance first and they would have coverage under your policy. Without the "Additional Insured" endorsement, they would only have their own insurance to respond to it and most building owners, justifiably, want to manage risk and pass on as much liability exposure to those they deem responsible for the claim. While their is a charge to add an Additional Insured, it is usually negligible and you can have your agent include the "Blanket Additional Insured" endorsement when you first get your insurance. That rider is about $100 or so and affords you unlimited additional insureds throughout the policy period. That's it for today! Thanks for reading.
Ben/Insurance
[email protected]


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## Ben/Insurance

Secrets to saving money on your insurance. What your insurance agent should be telling you. 
Insurance companies are in business to make money and if you don't let them make money on your insurance, they will make your life difficult. For established businesses, this means doing what you can to lower your claim frequency and severity and help lower the insurance company's expenses. How? Make sure you pay your bills on time. Don't wait for the cancellation notice to pay. I can't tell you how many discussions we have with underwriters over payment issues with clients. The better payers always get preferencial service with them. Better service and better rates. Keep you claims down! We in the insurance business, scale your profitability on what we call your "loss ratio". The lower the number the better. Break even for them is 50% (50 cents paid on claims for every dollar you pay them) and the best accounts are way below that. The better your loss ratio, the lower your insurance costs. Go over 50% and face big increases or worst, no renewal offer. Work with your insurance carrier on improving your operations. Use their resources. They know risk management and know how to reduce claim frequency and severity. When they see that you are working with them, it makes underwriters happy. Happy underwriters make clients happy in the form of better coverages and lower premiums. Not much room left here but I think you get the point. Ben 516-233-3515 or [email protected]. Thanks for reading! Off to lawnsite soon!


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## grandview

Question,if something happens and you not sure if you should put a claim in,should you only talk to your agent or call the 800#? I thought if you call the 800# they will mark it as a claim not paid out but will go on your record.


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## Ben/Insurance

Call it in to your agent and make sure they report the claim "for records only" if you don't think it's going anywhere. It will show up on your loss run that way which is good. If not, just report as a "normal" claim. It's worth discussing with your agent. A good insurance agent is worth their weight in gold. 
Ben


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## merrimacmill

Ben/Insurance, 

When I saw your posts start popping up, I assumed you were some kind of unsponsored solicitor. But I see that your providing actually useful information from a perspective that most snow guys will never see or understand. 

Insurance is a huge issue in the snow industry, and it is widely misunderstood. Having someone who actually understands this on the forum is a great benefit, and I applaud you for coming on here and taking the time to educate the snow community on these topics. Keep it up!

Can you inform us a bit about a "CLUE" report? What is the behind the scenes deal with these reports, and can asking a simple question about coverage limits or terms put a negative mark on this "CLUE" report as I have heard it does?


Thanks again!


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## Ben/Insurance

Thanks for the kind words. Thanks merrimacmill. A CLUE report (Comprehensive Loss Underwriting Exchange..I believe) is a claim reporting system that all insurance carriers subscribe to. Basically, insurance companies share your claim info with one another when you apply for new insurance. CLUE is used only for personal insurance only (auto/home/boat/umbrella etc), not for commercial lines (business insurance). "Loss runs" are used with Commercial lines. So any personal insurance claims that you have incurred go onto your CLUE report. When shopping for car/home/boat insurance, make sure your carrier or agent runs your CLUE report BEFORE giving you a price. I can't tell you how often the "direct" carriers price things out without running the CLUE only for your policy to come in at twice the price when they find out that you've had an old claim. We run CLUE reports ALWAYS, before we price things out. Asking a coverage question or the terms and conditions of your policy have zero impact on your CLUE report. Remember, CLUE is just a claim reporting tool for insurers. Hope that helps.
Ben


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## Whiffyspark

I just had that happen. I had already signed on. All they could say was sorry


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## Ben/Insurance

Plowing snow with your personal truck? So, you plow snow with yourl truck that you insure on a personal auto insurance policy (PAP). Are you covered if you have an accident? This questions comes up all the time and I'm happy to answer it here. The answer is, if you are plowing and getting paid for it, your personal auto policy will not respond if you hurt someone or cause damage to someone's property. I'm referring to NY, NJ, and PA here. I'm not versed on policies outside of these states. So when you hit a parked car with your plow...no coverage. You need to buy a "Commercial Auto Policy". If you are doing your neighbor a favor, and not getting paid by him/her that is a different situation and your PAP will respond if you have a claim. 
Ben/Insurance
[email protected]


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## snowbunnyNJ

*Snow plowing insurance*

Anyone else out there having trouble finding insurance for the Snow plowing season.


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## Ben/Insurance

snowbunnyNJ;1841665 said:


> Anyone else out there having trouble finding insurance for the Snow plowing season.


What insurance products are you having trouble
finding? Is it General liability or truck insurance? I may be able to help you. 
Ben


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## snowbunnyNJ

*Snow Plowing Insurance*

I should have said "affordable snowplowing insurance".
Last year insurance renewed in the middle of snowplowing season and insurance company notified me that they will not renew the snowplowing coverage. After pleading my case, they extended the coverage just until the end of the season so that I could finish the season. My insurance premium for the snowplowing coverage was $2,000.00; now I am getting proposals for $60,000.00 to $250,000.00. Agent is telling me that the Insurance Companies are pulling out of NJ; not wanting to write the coverage. One quote came in with a deductible of $20,000.00. Obvious to me that they don't want to write the insurance here! Its not getting any easier to make a living and continue to enjoy something you love to do.


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## Ben/Insurance

snowbunny. Unless you are plowing NYC/5 boros, airports, public roads, or have a ton of claims, those quotes are outrageous. Get in touch with me, I can probably ease your pain. 516-233-3515 or [email protected]
Ben/Insurance


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## Ramairfreak98ss

snowbunnyNJ;1841665 said:


> Anyone else out there having trouble finding insurance for the Snow plowing season.


You too snowbunny huh? I've heard guys starting to have problems in NJ areas in the northeast last year, but it is hitting us like a brickwall this year. Ive already talked to two guys and a sub contractor that either are having a hard time getting any quotes, quotes that are so blown out of proportion to the work they do or flat out not plowing now.

We don't have that option, we have a fortune invested in machines, boxes, plows, trucks, spreaders and have a good handful of accounts every year. Our insurance went up 800% a few years back.... never had had a slip and fall until EIGHT from one USM/Walmart account 2010-2011.

Had NONE the next two seasons... you'd think that would help right? not really.

This past winter was crazy, tons of work, out all the time, huge salt costs, labor, workers comp, repairs, etc.

The insurance audited us and come to find out, the policy premium we paid for "in full" up front was merely the deposit last year. I find out we owe about 8% for our total gross sales on top of some miniscule number our insurance agent carried over from our landscape sales for the GL policy the year prior.

Got a bill a month ago for an insane amount.

Now by November 15th, we need snow insurance again.

Received only three quotes, ... now granted, we were paying peanuts for insurance in 2009-2010 area, until it went up to a pretty hefty amount, i mean more for the snow policy than our commercial auto for ALL of our trucks and trailers and hired autos.

This year, i have one quote that wanted 14.5% of gross sales after the estimated sales, another is 25%, yes TWENTY FIVE percent of your sales just for the one policy, the other won't write additional insureds so that one is n/a anyway.

This year, we're looking at a 900% increase from last year for the estimated premium, which if we have a half descent year, will cost a ton more in the end anyway.. I never thought i'd say that its almost not worth if at this point.

Last year we had THREE total slip claims, one is bogus as the site manager informed us formally via text/email not to salt that next morning, the slip happened that next morning and not in an area we handle the sidewalks for anyway... but its still a claim.

Another one was for a very small account, convenience store, we salted 85+ times last season for them, and one day in February, snow melted off the overhead lit sign right into the door pathway, no major injuries, but suing none the less.

Third was at a supermarket store, on a day it didn't snow, not even sure what time, but we salted that morning and that night anyway just for possible re-freeze,.

What the hell else more can we do?

Meanwhile prices are going down on accounts, we lost two good accounts this season because they found someone cheaper now, after our bills last year were so high for all the services. We provided good service, on timely fashion, was always clear, no slip and falls etc... and outpriced by the next guy that may not even have insurance.


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## Ramairfreak98ss

snowbunnyNJ;1841903 said:


> I should have said "affordable snowplowing insurance".
> Last year insurance renewed in the middle of snowplowing season and insurance company notified me that they will not renew the snowplowing coverage. After pleading my case, they extended the coverage just until the end of the season so that I could finish the season. My insurance premium for the snowplowing coverage was $2,000.00; now I am getting proposals for $60,000.00 to $250,000.00. Agent is telling me that the Insurance Companies are pulling out of NJ; not wanting to write the coverage. One quote came in with a deductible of $20,000.00. Obvious to me that they don't want to write the insurance here! Its not getting any easier to make a living and continue to enjoy something you love to do.


Same here, ours was a lot more than $2000 for the season, but yeah, ive seen almost all six figure quotes and that still won't cover us for a "good snow year", we'd owe 25% on top of that amount for every $1000 we bill out, who can make money when 25% is just for ONE insurance policy?


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## snowbunnyNJ

Hi Ramairfreak98ss thanks for the reply. You mentioned investments, yes I have investments; in plows, snowpushers, trucks, a loader, the salt spreaders. How about the people I employ and the time myself and family have invested. But clearly I dont have to tell you about that. I have serviced my oldest account 32 years and I am sitting here wondering if this is the year I'm out and why....because the insurance costs are too high...and here in Jersey everyone is sue happy.
Property owners don't want to take ANY responsibility for liability and put it all on the contractor. I went back to one account to see if they would give a little and they flat out said NO. So what are you supposed to do, right.


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## Ben/Insurance

Guys, I review the insurance requirements of contracts for my clients all the time and most of the time, my advice to them is to move on and don't get involved. Short term, the money is good, but long term it usually ends up trouble with claims, additional premiums on audits, you getting paid promptly, your insurance carrier getting ticked off and dropping you, you overbuying equipment, etc. My advice to you is have your insurance agent (a competent one) review the insurance requirements of any contract before you sign it. Especially, long term contracts and you probably won't have these problems. My best clients walk away from a lot of work but maintain a low cost, high quality, consistent insurance program that includes snow removal. 
Ben/Insurance


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## Shepard at FPC

*Insurance question for underaged*

I am 15 yrs old. I started a lawn/snow business when I was almost 12. I was just asked to take on the snow removal for the sidewalks on a local apartment complex. I'd technically be working for a guy that the complex hires for all the property maintenance, and he has his own insurance. But he can't hire me directly because I'm not 16 yet. He mentioned hiring my dad instead, and then I just go do the work under my Dad's name. (so I'd be doing all the work, but legally speaking my dad is doing it) Is there any legal way to go about this, where if something happened this guy's insurance would cover the damage? I am pretty careful, but things happen. I could bump somebody car, the snow blower could shoot a rock through a window, etc. I will be pretty darned mad if I do make any of those mistakes, but I do want to be covered under the scenario that something like that did happen. Or somebody could fall on a sidewalk that I was "supposed" to make safe to walk on, and I don't want my dad to get sued or something! Any advice on this situation would be much appreciated!

FYI I have a number of other customers for both Lawn care and Snow Removal. I don't have insurance for any of it, and luckily I've only made one mistake. And the people were very nice about it, I had to pay to cover the damage but that was it. (had a very dumb trailer setup temporarily and was in a big hurry...long story short the trailer came unhitched from my mower, going down hill, and took off the trim of a parked car) I have used a 24" Ariens snow blower for the last couple of years, and am planning to pick up a John Deere 214 with snow blower tomorrow. So I'll be using the tractor for most of the snow blowing.


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## Ben/Insurance

At the end of the day, if you hurt someone or damage their
Property, you are responsible. You need insurance. 
Ben/Insurance


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## Shepard at FPC

Ben/Insurance;1846996 said:


> At the end of the day, if you hurt someone or damage their
> Property, you are responsible. You need insurance.
> Ben/Insurance


 OK, thanks. Is there any way for me to get insurance as a 15 yr old or am I just going to have to hope that I get lucky and don't damage anything until I'm 16? Once I'm 16 I guess I could have my dad get insurance and I'd technically be his employee...correct? Or can you buy your own at 16? I just don't know if there is a way to get insurance until I'm older.


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## Ben/Insurance

Where you buy your insurance from makes a big difference. I work with a lot of new clients that are having insurance problems. Usually, they can't get favorable terms, conditions, pricing, or quality insurance carriers from their current insurance source. You will see through this forum that I always suggest that folks work with larger sized, independent insurance agents (IA's) that have a large contracting clientele. We are your best resource for insurance and the right agent will take your insurance pain away. A larger sized IA has direct appointments with many strong, reputable insurance carriers that the store broker and the Allstates, State Farms, and Geicos of the world have no access to. IA's work for YOU not the insurance company and it costs you nothing extra to work with us. What's more, if you are unhappy with the company we give you, there is no need to go to a new agent...we just move you over to another carrier. You still deal with the same agent. It's a concierge approach that works well for the consumer. 
Ben/Insurance
[email protected]


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## rgrimes945

*NC DOT Insurance*

I'm in need of a company that can write for me in North Carolina. Doing DOT work with BIG coverage requested Any help would be appreciated.


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## Ben/Insurance

RGrimes, I'm not licensed in NC so I can't help
you. I would suggest that you contact a larger sized 
Independent insurance agent in your area that
works with a lot of contractors and has a specialty 
In this area. Don't buy just on price either. A good insurance agent is worth their weight. Good luck. 
Ben/Insurance


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## crazyboy

ughhhhh, 1 truck company here doing 95% sub contract work. Getting quotes of $7500, paid in full upfront, for a 1mil dollar policy. How do they expect us to turn a profit???


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## Buswell Forest

There is some excellent reading in this link. This is posted just for the informational value, not as a plug for this insurance provider. Not trying to step on Ben's toes here. This says in NH, ME, and NY, the plowing contractor can not be sued by any third party. Check it out.
http://acadiainsurance.com/blog/general_liability/there-is-no-off-season-for-slip-and-fall-claims/


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## pats plowing

ben
this happened just want your take on it
scenario: I am contracted for snow/ice removal 11/1-4/15 of a given year. there is a known issue at a retail outlet when the ground freezes, the sidewalk heaves creating a 1" difference in sidewalk height (concrete walk). a lady falls November 10th I am sued. We had zero precipitation for 20 days prior and 10 days after this event. this was a known condition as I produced work orders from the retail outlet going back from 2007-2012 for this "frost heave" and the sidewalk remains unfixed since the concrete was never tied into the apron of the storefront. My insurance stated I was responsible for this slip and fall despite it having nothing to do with weather. I was dropped from their coverage and now am paying $20k for my insurances and I am a sub million company all self performing. Can this happen or did I get hosed?


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## Buswell Forest

You got hosed- unless your contract with the store specifically holds you acountable for this somehow.


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## Ben/Insurance

Pats, I would need to see your loss run to see what
went on. Your insurance carrier might have only paid
some defense costs to get you out of the law suit. If this
carrier still dropped (non-renewed) you, your agent needed 
to go to bat for you with the underwriter. If the underwriter 
Knew you were plowing snow, and knew what occurred here I think he/she would have renewed you. Ben


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## Ben/Insurance

Buswell, defense costs could easily cost tens of
thousands of dollars to get an insured out of a law
suit. I have reviewed many closed/paid claims and loss runs where
BI claims have been paid in addition to the previously
mentioned defense costs. 
Ben


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## njsnow88

Not sure if this thread is still alive, but perhaps you can help with the question i posted in the attached thread. Tried to message you but is not working for me.

http://www.plowsite.com/forumdisplay.php?f=48


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## njsnow88

Sorry that was the wrong link

http://www.plowsite.com/showthread.php?p=2038526#post2038526


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## NinaS

*High GL limits*

I tried to post a new question, but could only find the reply button. We are in Ohio and plow and landscape. Some of the bids I have seen from Aldi and PNCs require very high limits of GL insurance (10-20 million) My current insurance won't do it and I am not sure I want a contract that basically states that slip falls are my problem AND they will be added as addl insured and we have no say as to when a claim is settled. I would like to know how a small business can afford that high of insurance limits and if it's even worth the trouble. Thank you.


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## NinaS

We are in Ohio and plow and landscape. Some of the bids I have seen from Aldi and PNCs require very high limits of GL insurance (10-20 million) My current insurance won't do it and I am not sure I want a contract that basically states that slip falls are my problem AND they will be added as addl insured and we have no say as to when a claim is settled. I would like to know how a small business can afford that high of insurance limits and if it's even worth the trouble. Thank you.


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## Ben/Insurance

Nina, the cost of insurance is predicated on the frequency and severity of insurance claims and slip/fall claims for snow removal contractors are extremely costly for insurance companies, thus the tough terms and conditions not to mention the high insurance costs. The big maintenance companies sub contract all (or most) of their work to smaller snow removal contractors and pass on all of their risk exposure to you, in their contracts. For the most part, the insurance requirements are very difficult to satisfy and the insurance costs are unaffordable for a small business. I usually suggest that my clients pass on this work and concentrate on their own customers with more reasonable insurance requirements.
Ben/Insurance


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## NinaS

Thanks, we pretty much are forced to skip bidding on those accounts. It's just not worth it, in the long run. Thanks again.


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