Inquiring minds want to know…. Can I place an account with a non-admitted carrier when an admitted carrier is willing to write it?

By Ken Kukral

The answer….. as usual… it depends.


This is usually a state by state issue.   Some states such as Ohio do not have any statutes at all regarding this issue.  They used to have a statute that said if there is a 10% difference in premium or significant difference in terms, you can place the account surplus lines.


One example of this dilemma is Florida, where their statute states: 

“This means that you are now free to quote any risk falling into the specified classes irrespective of the fact that it may be currently written in an admitted carrier or if an admitted carrier is willing to quote the coverage. You will be able to quote on both a surplus lines and admitted basis. Surplus lines quotes may be at a lower price or on broader terms than admitted quotes.”


So what should you do?

1. Research your specific state statute.  Make sure you follow the regulation to the letter of the law.  If a problem arises later on,  and you DID NOT follow the statute, it will be tough to mount a defense.  Following the statute does not guarantee you will have a solid defense, but does help your case.


I am not as big fan of just calling your state insurance department.  Depending on who you talk to, you can get differing answers.  When a problem arises later, you may not be able to rely on incorrect information you may have received,  if it conflicts with the actual statutes.


Check with your state surplus lines association.  They have been asked this question numerous times and may have something official they can send you or they can direct you to the state statute that applies.

2. Many states have affidavit or due diligence forms. You need to make sure these are accurately completed. Don’t just go “through the motions” with the due diligence process, make sure you take the form seriously and get formal or “solid” declinations from the admitted markets you have access to. Keep in mind that when a problem arises, it may be years later and this form could become a key document. Do not list carriers that you will be providing admitted quotes from or that you already have a quote from.

3. Document your file. If the client chooses a non-admitted carrier over an admitted carrier they must be told that there is not a guaranty fund to back up the carrier if they were to become insolvent. Keep in mind that you will be viewed as the “professional” if there is a problem. The more you can document your reason for offering a non-admitted option when an admitted quote was available will help support your decision. Things such as pricing, broader terms, meeting the insurance requirements you client asked for or providing more basic coverage when your client cannot afford the higher price may all be reasonable reasons for your decision. The more you can show that your client made an “informed” decision, the better off you will fare. Keep in mind that “price isn’t everything”.

4. Do some research on the financial stability of the non-admitted carrier you are placing the account with. This will help show the effort you made in placing the account with a non-admitted market over an admitted carrier, taking into account that the carrier needs to be financially stable since they will not be covered by a state guaranty fund. Checking their rating with one of the insurance carrier rating services such as AM Best and even putting the carriers rating on the quote will help.

5. Understand that you are taking a risk. You need to manage that risk by making sure you take proper steps to reduce that risk. Dotting all your i’s and crossing all your t’s is important and some extra effort in placing the account properly must be taken. Doing what is “best” for your client is key in this situation.

This situation may never arise in your insurance carrier but if it does, you need to be methodical and deliberate. How you document your file and taking the proper steps will be critical if a “problem” (insolvency of the non-admitted carrier or an uncovered loss) happens down the line. Dealing with a knowledgeable and seasoned wholesaler will provide some assurances that you have done “the right thing”.

Addicted to organizing

By Cathy Thurber

I’ve heard that the first step in the road to recovery is admitting that you have a problem.  So, I am hereby acknowledging that I am an addict.  My addiction?  Organization.

Yes, I cannot get enough of organization.  I read the magazines and fold down pages.  I read the blogs and pin my favorites.  I bore my husband endlessly about all the little things I want to do around the house.  I just can’t stop!  I think it’s because I feel if I have everything organized then I can adjust to the speed my life seems to flow at…..which is fast.  Some days, my life is just running in the fast lane with barely any time for bathroom breaks.  My brain seems to think that organization will help me on those insane days, so at least I don’t have clutter to get in my way.  This includes my work desk….yes, even though I have a pile or two on my desk they are at least organized so I know what they’re for!

Perhaps sharing my addiction with others is another step towards recovery.  So, here are a few tips that can apply to either home or work, I’ve found:

  1. Use a calendar! Yes, I am obsessed….I have three separate calendars that I write everything down on…my work calendar, my kitchen calendar, and the little calendar on my phone.  I’ve found that the calendar on my phone is the one I use the most.  I have to use a calendar because of all the extra-curricular activities with the kids.  Not to mention if we actually have time for a social event!  I’m assuming I’ll get more of those after the kids graduate.
  1. Figure out what is a priority. There are so many things that I need to get done, especially on the weekends, that I just have to prioritize everything.  Getting the kids to their practices on time sits much higher than grocery shopping, which I could always switch to another day.  Of course, I can’t stand grocery shopping, so that one ALWAYS gets pushed around.  I do this at work a lot, too.  So many things are considered important and I just have to pull out the items that are truly a priority for that day.
  1. Figure out what is a problem and develop a solution. I can’t tell you how many times I end up washing clothes all week long.  This includes nearly all day on Saturday and Sunday, too.  It’s like dirty clothes are bunnies….they just reproduce like crazy on my laundry room floor.  The problem turned out to be two-fold:  my daughter would only bring her hamper down twice a month, and then it would be filled with clothes that she only tried on and never wore.   This was a definite no-no.  Plans were instituted on when the hampers should be brought down.  And if there were clean clothes in the hamper – she did her laundry on her own, therefore freeing up my time.  This sentiment, of course, is also something that is important at work.  It’s imperative to define a time management problem you may be having and figure out how to resolve it.

Of course, there are so many other ways to organize.  Don’t get me started on baskets, shelving, and storage options!  These are just the basics of organizing.  Maybe your desk – or home – will be a little more stress-free because of it!

So your client needs an additional insured endorsement?

By Ken Kukral

One of the most common service requests you will receive is the adding of an additional insured endorsement to one of your clients general liability policies.  This request is usually inclusive of a request for a certificate of insurance with a short time line to fulfill your client’s request.  Your client needs this for a bid request or to get paid for a job where they forgot to review the contract and send on the insurance portion of the contract to your office so you could review.   Sound familiar?

With many requests for an additional insured endorsement being on a last minute basis the chance for errors increases.  How should you handle these requests or be proactive with your clients on this important part of their insurance program?

A few helpful hints:

1. Be proactive with your clients.  Discuss how you would like these requests to be handled during their annual insurance review meeting.  You may even want to have a “form” that you use for all requests so they are handled the same way each time (you may want to have this form on your website) and you have the information you need to timely handle the request.
2. Get a full copy of the contract from the client since the insurance requirements are not always included in the “Insurance” section of the contract.  Other things such as waiver of subrogation, indemnity agreements and who specifically is included in the contract may be in other sections of the contract.  Keep in mind that you are not an attorney!
3. Stay in contact with your clients.  Ask them questions such as if they are working on any new projects, if they took on any new clients or if they are working in any other states.  Answers to these questions can be very revealing and can alert you to additional or uncovered exposures.  Just asking them if they signed any new contracts will give you something to look at.
4. Next point is one of my personal pet peeves.   Unless the contract asks for a specific additional insured endorsement (by number CG20XX), it is your responsibility to determine what additional insured endorsements will best fit the needs of your client and the additional insured.  Over 80% of the additional insured requests our office receives are devoid of the actual endorsement number we should use.  Do you want to trust that a broker once removed from dealing directly with your client can pick out the best and most appropriate additional insured endorsement that fits your client’s situation?
5. Blanket additional insured.  Keep in mind that they are not all the same.  Some pick up additional insured where required by contract.  Others only pick up additional insured’s that are reported to the carrier.
6. Review the insured versus insured exclusion in your policy.  It is best if there is not one of them, but if there is, make sure it is excluding liability only for named insured versus named insured.   If it is any insured versus any insured then the insured would not have coverage if they were sued by the additional insured.  This is definitely an E&O exposure.
7. If you are using the CG2010 and you want the additional insured to include completed operations, you need to add the CG2137 or the minute they finish the job, they will no longer have coverage.
8. Some additional insured endorsements cost money, some do not.  Find out up front when writing a policy so there are no surprises during the policy.  Make sure you understand what is needed to add any additional insured when you write a policy so that you can get it done quickly and efficiently.
9. When sending in an additional insured request make sure you explain what their “interest is” (landlord, general contractor, etc.) so that the carrier can understand the relationship with your insured.   Many times we just get a generic e-mail asking us: “please XYZ Co. as an additional insured”.
10. Last of all be consistent.  Handle additional insured requests in the same manner every time.  If you clients understand up front what the “process is” then they will be less resistant to follow the guidelines you have even though it might be a tense or limited time situation.  No different than what a pilot goes through before takeoff.            Would you feel comfortable asking the pilot to skip the second half of his pre-flight checklist, just because you are running late?

You work hard to write business.  You work hard to retain business.  So why would you let a standard type of service request such as adding additional insured’s throw a wrench into your whole plan?  Handling these requests in a consistent and efficient manner will help to build your image as an excellent service provider and help eliminate E&O issues before they ever even get started.

Insuring Tunneling Contractors- A different kind of animal

By Ken Kukral

In the world of insuring contractors there are some unique exposures.  Tunneling contractors have some unique exposures and insuring them takes a different approach. Some things to consider:

– Most insurance carriers do not understand the exposure and will shy away from these types of accounts.

– Some of the carriers will look to write coverage on a claims-made basis due to the difficulty in writing this type of contractor.  Occurrence coverage is available

– Defense outside limits is also available since many carriers will look to do defense inside limits due to the severity type of losses that could occu

-You will want to make sure there are no exclusions for X (explosion) C (Collapse) or U (Underground)

– My times the project owner will want to be named as additional insured along with the project engineer.

-Since the completed operations exposure is of an “extended” nature there may be a request for a 3 or 5 year extended completed operations following the end of the project or end of policy term.  This is available but must be negotiated with the carrier.

-Many of the projects being bid out are large so you may need to insured a joint venture or combined program with more than one contracting firm.

– Many times these contractors have a unique builder’s risk exposure.  Coverage is available from specialized markets.

Contractor’s professional may also be requested and will need to be explored to cover the internal specialized personnel for the tunneling contractor who may have an engineer on staff.

-Many times pollution coverage will also be requested.  The contractor’s pollution should be available on an occurrence basis.

– Most larger projects will require a minimum of $10,000,000 in limits and potentially $25,000,000

-The tunneling or boring equipment is very specialized, very expensive and could take a significant period of time to replace.  It will be important to properly cover this equipment with a knowledgeable inland marine market that can cover the business income (including extra expense) exposure.  Many of the contracts for tunneling projects have completion date requirements and having the proper coverage can help dealing with this risk.

-There is no real application available for writing tunneling contractors.  You will need to find out as much information on the project, get bid specs and make sure you go over these with the carrier.  You will need to build an “experience resume” for the contracting firm to help convince the carrier that they have the needed skills and ability to successfully complete the particular project.

– If it is a larger project, you may have multiple contractors bidding on the project using a limited pool of carriers.  Find out what the market selection process is so you have the best opportunity to successfully put together coverage for your contractor.

– Finally deal with a broker who has experience in writing these type of projects/tunneling contractors to maximize your chance of putting together a comprehensive insurance program.

While tunneling contractors might be challenging types of accounts to write it will be worth the effort if you work through the details and make sure not items are missed that might cause them to lose the bid.  With the number of sewer projects being bid out to meet with the coming EPA requirements there is plenty of opportunity in writing tunneling and boring contractors.

Memorial Day is Every Day

By Cathy Thurber

Memorial Day has passed us by this year.  Did you stop to take the time and remember those who served, or currently serve, our country?

I always try to take a moment and think about my family members that have put themselves out on the line for my safety.  Who have left our great country and gone abroad in order to handle crises elsewhere.   Or even those who have served while remaining stateside.  My grandfather was in the Army Air Corp back in the 1940’s…..this was what the Air Force became.  He served near the end of World War II and always said that it had made him a better man.  My Uncle Rick was a Marine in Vietnam.  He never would talk about his experiences around others.  It was just that difficult.  My mother always said he left for the war as a boy and came back a man.  Both of these fine gentlemen have passed away now and I miss them terribly.  Whenever I think about them I quietly thank them for their service because I know it was an important part of their lives.

My nephew is now in the National Guard.  As I write, he is at Basic Training and, in fact, just finished his 13 mile march yesterday.  I remember him as a little boy, so precious and precocious, and now I see him slowly turning into an amazing young man.  He is not only in the National Guard, but attending college and keeps a solid GPA.  I’m so proud of him.  And I know that he is ready to serve his country when he is asked.  It’s not just a job….it’s a dedication.  It awes me, the depth of servitude that these men and women have running deep within their core.  I am humbled by it.

I hope that you remembered to think of our soldiers, old and new, this year.  And truly, I hope that you remember them every day because their sacrifice is worth so much more than just one day a year.  They are deserving of our remembrance daily.  My love, prayers, and thanks go out to each one.

The Lost Art of Submission Narratives

By Ken Kukral

I remember a number of years ago when I went to a reception held on the aircraft carrier The USS Intrepid.  Kind of a unique place for a cocktail party but I figured I would go check it out.  Well the week I was in New York it was in the 80’s then in the 40’s a day later so it was tough to control the temperature so it was a bit stuffy on an aircraft carrier.   I quickly thought, I will make a showing and then slip out.

As I tried to sneak towards the door I overheard one of the tour guides telling the story or some of the battles the aircraft carrier was in.  I was enthralled by the stories he was telling and how he brought them to life.  Over 10 years later I can still remember the stories he told.  So the value of telling a story in an interesting and “lifelike” format is that it will be memorable.  I only wish all history teachers could realize this and incorporate it into their classrooms.

So why don’t more producers look to tell their clients “story” so that it will bring the account to life and catch the interest of the underwriter?   I have always heard in sales it is “all about the story”.  There is no way an application can tell the full story on an account so why not “tell the rest of the story” as the late Paul Harvey used to say.  You do want your submissions to stick out and catch the interest of the underwriter don’t you?  A well written narrative will answer many of the questions the underwriter may have and help speed your submission to the quoted stack.  There is nothing worse than back and forth information gathering so slow down getting a quote.  If you think about it, so few submissions have narratives anymore, that your submission will stick out favorably.

So what are the components of a good narrative?

1. One page in a story format

2. Details of your knowledge or relationship with the customer

3. Details of what makes this a good account

4. Loss control or risk management that the customer has implemented.

5. Explanations of any losses

6. Details of the business including growth plans

7. Why the carrier has a good opportunity to write this account

8. Any pricing or terms you need for this account to improve on their existing program.

9. Any gaps in the “story” for this account

10. Last but not least, when you need the quote by.

It is not a contest to see how little information you can to the carrier and still get a quote.  This is a journey to properly write the account with the best value you can so that it can be a long term client for your agency.  Develop your own narrative story format, be consistent and tell your clients “story” the best way you can.

I would love to see any template format that your agency is presently using.

Texting and driving- an accident waiting to happen

By Cathy Thurber

Just the other day I was driving home and noticed that the car driving towards me was slowly moving towards my lane.  The gentleman driver wasn’t even looking at the road; he was busy texting on his phone.  Luckily his car did not go into my lane and someone behind me honked, causing him to pay attention and get back in his lane.  The driver had been so engrossed with his phone that he wasn’t even glancing at the road in front of him.  It was an accident waiting to happen.

That got my thoughts churning.  I know that Ohio’s state legislature had been talking about a statewide ban against texting and driving, but at this point there is no prohibition against it.  Certain municipalities have issued distracted driving laws, but it’s ok to text and drive elsewhere in the state.  And seeing this guy slowly drive into my lane made me think of all the drunk driving laws.  I know you’re not incapacitated when you’re just texting, but the level of attention you’re paying to what’s around you has got to be about the same.  Don’t get me wrong – I have texted while driving before.  But after watching how distracted that driver was coming towards me, I realized how I could be putting people in danger with every tap on my phone’s keyboard.

I read that the National Safety Council estimates that 200,000 crashes are caused every year by drivers that are texting; and those who drive while texting are 23 times more likely to be involved in an accident.  Whether or not the state is going to pass legislation on this, don’t you think it’s just common sense to NOT take your attention off the road for those long moments?

Everyone that texts while driving is being neglectful to all the other drivers on the road….not to mention those kids that may be sitting in the backseat!  For God’s sake, put the phone down and pay attention to the moving vehicles surrounding you!  You won’t catch me texting while driving anymore.  I have a future I want to experience and I need to be alive to do it.

You know you're in insurance when…

By Cathy Thurber

I believe that the only way you can make it in life is if you have the ability to laugh at yourself.  So, when I found some insurance jokes online, I just had to share them.  Take a seat, relax….and if you’re in the insurance industry, laugh at yourself.

You might be in the insurance industry if…
1.   You have sat in the same desk for 4 years and worked for 3 different companies.
2.   Your resume is on a diskette in your pocket.
3.   When someone asks what you do for a living, you lie.
4.   You get really excited about a 2% pay raise.
5.   Your biggest loss from a system crash is that you lose your best jokes.
6.   You sit in a cubicle smaller than your bedroom closet.
7.   It’s dark on your drive to and from work.
8.   Fun is when issues are assigned to someone else.
9.   Communication is something your “group” is having problems with.
10. You see a good-looking person and know it is a visitor.
11. Free food left over from meetings is your main staple.
12. Art involves a white board.
13. All real work is done prior to 9:00 AM and after 5:00 PM.
14. You’re already late on the assignment you just received.
15. Dilbert is your favorite cartoon.
16. Your boss’s favorite lines are …
”when you get a few minutes …”
”in your spare time …”
”when you’re freed-up …”
”I have an opportunity for you …”
17. More than 10% of the people in your company do not know what you do.
19. Change is the norm.
20. Nepotism is encouraged.
21. You read this entire list and understand it.

Is it time for a terminology change?

By Ken Kukral

With the litigious society in the United States, there have been terminology changes in the insurance business to better reflect the intent of coverage.  A good example of this was the change from the term “All Risk” Property Coverage to “Special Form”.  This was done to reduce the confusion with clients that not all risks were covered under this policy.  There are numerous exclusions that reduce or eliminate coverage.


One of the areas that I believe is in need of a terminology change is the term “Umbrella Policy”.  The confusion that is created by this term is that this policy provides an “umbrella” for other liability exposures the client may have.  The reality is that there are very few (if any) “true umbrella” policies being offered. What clients really have is a “follow form excess liability policy”.  So if they have coverage under their primary policy, they have higher limits for ONLY those coverage areas in the excess policy.  There would not be a “drop down” if there was a claim that is not included in the primary coverage or if the primary insurer became insolvent.


So what term should you use with your clients?  I would use the “follow form excess” term so they get the idea that all you are offering them is higher limits of coverage they have in their primary insurance program.  It is important to list all policies in the follow form excess liability since they will only have higher limits for what you have listed in the schedule of underlying policies.  Don’t forget employers liability (something that happens more for Ohio accounts since this is a monopolistic state and we might only be writing WC in other states on an if any basis).  It is important to note that some carriers include hired & non-owned in the excess automatically (when there is underlying coverage) and some force you to list it in the underlying schedule.


One other note, check your exclusions in your follow form excess liability since they will reduce coverage that might be in the primary policy.


Us old timers need to be conscious of the changes in terminology so that clients do not get the wrong impression.  When we use terms that give the impression that the coverage is more “all inclusive”, we risk an E&O claim.  Details matter….

Deadlines are the Devil… or are they?

By Jen Monroe

I was reflecting on the topic of productivity the other day, mostly thinking about all of the different ways our environment affects it. From birth, I was a “night owl” so it was no surprise that I had my most productive and creative moments late in the evening and early morning. In college, I found that I did my best work at night. I went to school for art, and earned a creative degree so being “in the zone” is very important when it comes to my work. In the art world, a studio would completely transform at night, from “class mode” to an open, creative environment. In this space, I could free my mind, get into my work, and occasionally stop to collaborate with others. Thanks to this environment, I was never afraid of a solid deadline— the more pressure that was put on me; the more I would arise to the occasion.

Being a creative in the insurance world is a dramatic change of pace compared to the easy going environment art school creates. Working a 9-5 position instead of staying up all night to finish off a project has changed me in ways I never thought possible! For instance—I can officially say I am a morning person. Who would have thought right? In the way of getting “in the zone” it is much more difficult. There are constant interruptions—between emails, phone calls, and everyday marketing needs from my fellow employees I rarely get the opportunity to be in a creative state of mind. Over the years, I have had to adjust to this environment change… somehow I make it work. The one constant between my college days and my insurance days is that everything I work on has a solid deadline.

I’ve learned instead of buckling under the pressure of a deadline, to embrace it. It’s what keeps my creativity flowing, and ignites my will to push through obstacles without a problem. I know some people become less productive or overwhelmed because of the stress, personally, I say bring it on! (Does this make me a glutton for punishment? Lol)