By Ken Kukral
When you have been insurance a long time you begin to take a slanted view of the world and nearly every “situation”. This weekend I was talking with a person who runs an ice rink and is in the middle of a major repair to the rink that has it shut down. Not only are they closed and turning customers away they are losing significant revenue that they will most likely not be able to recoup. So my thought is, don’t they have equipment breakdown coverage with business income extension of coverage? He swears they do not….and I wonder…. Did their agent offer the coverage and they declined? (Many clients don’t even remember they have the coverage until the agent points it out)
Another person at the rink I was at (an underwriter at a major insurance company that writes ice rinks) stated they have the coverage on all the rinks they insure…
So do you offer mechanical breakdown coverage to all clients that have an exposure? With nearly all standard carriers offering the coverage as part of their package you should offer it, explain it and recommend it to your clients. If you don’t, why not? The cost is reasonable…. It is easy to quote…. And may just take some extra time to explain it to your clients and stress their need for the coverage…
What about on accounts they you are placing in the excess and surplus lines market? You may not be aware but many of the E&S carriers offer mechanical breakdown coverage and a lot of them offer it on nearly all quotes. If they don’t offer it, did you know it is available on a monoline basis? It can be quoted in minutes and the prices are reasonable. The coverage provided is the same as what is offered in the standard market.
Do you not offer it because you don’t understand it? If so, the carriers that write the coverage have numerous classes, educational marketing material and claims examples that will help you understand the coverage and help you sell the coverage. Ignorance is not a good reason to not offer it (sorry for the double negative, my mom the English teacher would cringe)
Hit ratio? Mine has been in the 60 to 70% range (if I am the one who ended up writing the account). Those sound like pretty good odds and it appears to me that it is “worth” quoting.
Going back to the person I talked to (manager of a rink) regarding the equipment that broke down at the rink and shout them down for over a week just before a big tournament, I wonder how he feels about his current agent. (hmmm I could have had coverage for this loss… did my agent recommend the coverage to me and I turned it down, or didn’t he ever discuss this with me.) Do you think he might go back to his office and check his insurance file?
Wouldn’t you rather be in the position of your client being irritated at themselves for knowing they were offered the coverage, made an educated choice to self-insure for it and might more seriously consider the coverage next time it is offered to them?
FYI – The information needed to quote this coverage can be found on the ACORD Applicant Information Section and the ACORD Property section (Unless you are talking about a huge account with multiple exposures). So you don’t need to do an extra set of applications to get a quote. It can’t get much easier than that.