August 31st, 2009 by DieWolf

The insurance industry enjoyed record profits of $60 billion less than two years ago. In the wake of these prodigious returns, the commercial insurance market was flooded with hundreds of millions of dollars worth of capital. This created an increase in the amount of carriers, as well as a greater capacity to take on risk. Ultimately, the influx of capital into the insurance market has resulted in an insurance environment that is extremely soft, with prices falling quickly. For restaurant owners who approach this soft commercial insurance market correctly, some of the largest premium decreases in years are available.

To understand why such attractive premiums are out there, understand a couple points:

First, insurance pricing is cyclical. The inflated prices simply cannot be maintained in the new commercial insurance environment of 2008. A major reason for this is that most commercial insurance companies are public companies. Thus, their shareholders demand growth. In order to grow, prices must be reduced to entice new clients and retain current ones. In addition, insurance carriers must enter new areas that they have no been active in historically. These carriers are then forced to write new lines of the coverage for industry segments like foodservice, hospitality, and franchise programs.

The second point to understanding the reason for the availability of lower premiums is that in the world of commercial insurance foodservice and hospitality is a niche area. Consequently, there is a limited amount of insurance carriers competing against one another to write a restaurant insurance account when the market is stable or hard. Now consider the reality of 2007 and 2008. You may have found that the number of carriers seeking your business doubled. The impact of this insurance market on niche industry segments like foodservice and hospitality can be exponentially greater than what is happening in the standard insurance market. This large supply increase as demand stays static leads to the falling prices that restaurant owners are now finding.

Why is it that buyers are usually the last people to realize the state of the commercial insurance market? Most policies only get renewed one time each year. The can lead to an information gap because the reality is that buyers rely on their brokers to let them know this critical information about the direction in which the market is headed. With markets shifting course substantially, and quickly, insurance buyers sometimes are not made cognizant of the shift until nearly a year later.

Furthermore, select industry groups, brokerage houses, and insurance carriers themselves usually are the ones formulating reports about the insurance industry. Oftentimes, these reports can lag six months behind. Rarely do they portray a precise picture of the current environment in the market. However, consumer expectations are driven by these reports. Many large companies who settled for a 10% pricing reduction will find out later than they could have gotten reductions of 25-30% instead.

There is no doubt that this inefficiency is the Achilles’ hell of the commercial insurance industry, especially at a time when the industry seems to be cannibalizing itself. For foodservice and hospitality companies it is also a situation that should be taken advantage of, especially in light of the fact that it will eventually swing the other way.

While we are currently in a buyer’s market, do not allow yourself to become careless when it comes to risk management. You can keep your insurance expenses at levels 25-40% lower than your competition by paying close attention to details and working with an expert. Controlling the basic elements of your risk will allow you to enjoy the benefits available in the market regardless of what cycle it is in.

Here are three additional questions you should be asking that your broker might not be answering adequately, or at all:

1) What is my renewal strategy? Keep in mind that you want to work the commercial insurance cycle, not the other way around. In soft markets, it is sensible to cancel a current policy in an effort to capitalize on lower rates. However, when the market hardens, you may want to negotiate 18-month or multiyear rate terms. You have the potential to reduce your restaurant insurance costs by 20-40% over a five-year period simply by paying close to attention to insurance cycles and acting appropriately.

2) Am I overinsured? You have little to no chance of losing every building you insure in any one single event. However, some people continue to purchase coverage for that very unlikely occurrence. If you have ten $1 million buildings in a state, you do not need a $10 million insurance policy. This is wasted coverage and can be extraordinarily costly, especially in a hard market. Your broker should run a Probable Maximum Loss to determine what the appropriate loss limit should be. Depending what your locations are, you realize that you only need between a $2-$3 million policy to cover the $10 million in buildings.

3) How can I effectively manage my loss history? A good broker will assist you in this endeavor, but most do not even mention it. Understand that your insurance losses stick with you for five years, regardless of whether you have two locations or 1,000 locations. Commercial insurance companies use these past losses to help them predict what your future losses may be. This can have a tremendous effect on your insurance prices. If you are like most companies, you have limited knowledge of the details behind the insurance companies’ loss runs. In essence, you are still being charged for a claim that occurred three or four years prior. Have them audited to be sure that details and numbers are accurate.

One point that cannot be overstressed is the importance of choosing the right broker to partner with. Unfortunately, most brokers simply do not handle enough restaurant insurance claims to maintain up-to-date knowledge on the insurance market for the industry. Obviously, the firm you partner with must understand your business, but you need to also be confident that they also are competent in understanding the environment and knowing the markets.

Keep in mind that these people are your representatives. You should choose them as meticulously as you would choose your legal representation. Try not to be a firm’s lone client, but also make sure that you are not a “small fish in a big pond.” A great broker will keep you ahead of your competition, keep you safe, and ultimately add to your bottom line.

You should also make every effort to meet your insurance carriers. Have a relationship with them, in addition to your broker. The carriers need to know you and understand what expectations you have. Not to mention, being on a first name basis will be a big help if you ever need a favor; inevitably you will at some point.

Finally, make sure you are maintaining open dialogue with both consultants and internal employees regarding customer-and-employee injury issues. You have to be tough on claims; but remember that communicating proactively and listening empathetically can turn cut fingers and strained backs into loyal employees and lifetime customers.

August 23rd, 2009 by DieWolf

The cost of flood insurance people pay nowadays is affected by the location where their house is located. Those people whose houses are located in higher-risk areas pay higher premiums and higher excess on flood-related claims as compared to those whose houses are in low-risk areas. Premiums on a house in a high-risk area may differ for example around 20 to 30 per cent than in low-risk areas.

In the United Kingdom, more than two million properties are located at flood risk areas. When you seek the services of a flood insurance provider, they have their own maps to determine if you live in a low-risk area. Although your insurance plan should pay for all flood damage, your insurance provider also expects you to take necessary precautions to protect your properties in case of a flood, too.

If you live in a flood plain, expect your premiums to be higher and an expensive burden. Some insurance providers may even refuse flood cover on people in high-risk areas cover. You can not expect insurance providers to give you a policy when your house is a on a flood path and you get hit by floods often. It will be ******* on their part, unless you will want to pay a high premium.

If the insurance providers think your house is in a high-risk area, they may even resort to getting a surveyor’s report before giving you a policy. If they give a policy to whoever applies without considering the high-risk factor, they will have to increase the cost of premiums for everybody to meet the cost of insurance claims.

An estimate by the Government’s Foresight Future Flooding report in 2004 showed that the annual average flood damage could increase even up to 20 times by the end of the century as a result of climate change, so not only the UK suffering from flooding because this is a global problem.

Floods can not be prevented but the people can do something to protect their homes from floods. Here are some tips from the Association of British Insurers (ABI). Concrete floors can be replaced with wood and cover with tiles. Chipboard or kitchen and bathroom units can be replaced with plastic equivalents.

The same is true with gypsum plaster. This can be replaced with more water-resistant material, such as lime plaster or cement render. You can also move service meters, boiler and electrical points to areas above likely flood level. One-way valves could also be put into drainage pipes to prevent sewage backing up into the house, hence to prevent flooding.

The bottom line is that if you are moving house or buying a property for the first time, always check whether your intended new home is on a flood plain or not. This information is readily available on the internet on official Government web sites, so there is really no excuse for not knowing – and if you do not know, you can be sure that you future insurance company does!

August 20th, 2009 by DieWolf

Marine insurance reimburses financial losses due to damage to a ship and any accompanying properties, including the cargo, from port of departure to port of destination. Available specialty marine insurance policies include those for marine cargo insurance, marine business insurance, and personal watercraft insurance.

One type of marine insurance is individual watercraft insurance which is aimed to target insurance of non-commercial usage watercraft. Individual watercraft insurance is similar to that of automobiles. Similar to automobile insurance, individual watercraft insurance policies might not only cover property losses but also offer individual protection and watercraft liability coverage.

The liability coverage may cover bodily injury to watercraft occupants, along with others who are involved in any accident. Further medical coverage is generally available in a separate policy rider. Uninsured boater coverage is available as well to cover any damage incurred from hit-and-run vessels, or from vessels which lack insurance coverage.

There is also the option of towing and salvage insurance. It can help with smaller incidents such as an engine failure, mechanical breakdowns, or even having fuel delivered to a stranded ship. Towing and salvage insurance can also help to offset the high costs associated with a vessel that has sustained much damage.

Agreed Value or Actual Cash Value forms are what’s generally offered for hull coverage on a standard vessel. Because for insurance, it depends on the cash value policies to determine whether when the vessel ages if it will depreciate in value. Some insurance companies continue to pay the full amount without the depending on the depreciation value.

Similarly, marine insurance can cover any and all risks, or just risks and perils specified in the policy. No matter the policy type, it is very important to fully understand all of the stipulations which may render the policy null and void. For example, many policies specify navigational limits which render the policy void if exceeded. Depending on the area, accidentally exceeding navigational limits can be very easy on the water where boundaries are not well marked.

Personal watercraft insurance is available for virtually all watercraft, from small pleasure boats and fishing boats, to large yachts and houseboats. Specialty coverage can include coverage for watercraft rentals, fishing excursions, and other charter boat trips. With a wide selection of insurance companies and options available, finding the right coverage for your craft and situation simply takes a little research.

August 19th, 2009 by DieWolf

Anything can be marketed effectively, and the basic principles of marketing remain the same, no matter what’s being sold: You focus on what the benefit is to the person who’s buying the product, you emphasize the points of differentiation between your product and the others in your market segment, and then close with the pitch.

We’re going to make an example out of insurance marketing here to illustrate the point. The reason for insurance marketing is because everyone needs insurance, and the market is saturated with a lot of products competing. Writing insurance marketing tips for a saturated market is an example of how you, as an internet entrepreneur, can make money by being a liaison to local businesses in your area.

So, let’s look at the big questions from up top – what’s the big benefit for taking insurance? It’s buying a specific sort of peace of mind. It’s providing coverage in case there’s a disaster. Let’s focus that into marketing insurance: “Wouldn’t you like to know that your family will be taken care of, if something happens to you?” is one way to state the benefit. Another one is “It’s cheaper to buy insurance for your car than to get into an accident without it. And while you may be a good driver, can you be certain of everyone else?” Both of these are fairly straightforward ways to insurance marketing and its benefits to the end customer.

Now, when I write insurance marketing tips, I’m constantly looking for the edge, the out – the hook. What makes this product work for the reader and prospective buyer?

To answer that question, I start with doing some research on Google, and look for page ranks for specific permutations of insurance buying search terms, like “cheap health insurance” or “cheap life insurance” or “auto insurance Michigan” – anything that will help narrow down the search fields. Then I look at what others are doing on those pages that pull up. It is extremely important to understand what your competitors are doing. It helps you keep track of market trends and makes sure you keep your edge.

Are they competing primarily on price, or are they competing on features? Insurance is a mature product category, so it’s difficult to differentiate on new features. Difficult doesn’t mean “impossible”, though. There are combinations of features on policies that can form a competitive advantage; in the field, these tend to be short lived, because someone else will notice what you’re selling and emulate it. Unlike technology where an advance can last for six to eighteen months before you get significant product *********** from competitors, writing a new policy package doesn’t take much (indeed, they’ll figure it out from your own marketing text…)

So the other differentiators are on price (which is the primary driver in insurance policies) and service (which is where insurance companies trying to maintain margins on policies try to set themselves up as upscale.

August 19th, 2009 by DieWolf

It takes a lot of time when a person thinks about the elements of his or her car insurance policy in terms of the rebates, coverage, premiums and other services. There are many options provided by the auto insurance companies, one has to understand them so that the best policy can be chosen.

Everyone wants to have a good and cheap car insurance policy. For this, people search for the quotes from different sources. It is important that these sources should be good and one must gather as many quotes as possible. Internet can provide you the right place to get started. You may search for as many quotes as possible easily on the internet. These quotes are easily accessible and are economically feasible. The internet is really very quick and also provides a lot of quotes. This is less time consuming and one gets what he or she wants on just a click of hand. Or else, it takes a lot of time to personally get quotes from car insurance companies and their agents.

The rates provided by the companies and agencies differ at different places. For example, In United Kingdom, it is very easy to get cheap car insurance quotes. If you try to get the car insurance from the same company from where you have got your life insurance or health insurance policy, it will be beneficial to you as the companies offer discounts to their previous customers.

They will even provide you insurance at lower costs and even provide more coverage. Thus, after insuring your car, if you actually meet any ill-fated accident, harm, injury or damage, then your single call to your car insurer can provide you support. Thus, it is advantageous to have car insurance before hand. So, it is always good to compare vehicle insurance quotes and then, selecting the best quote of any company. Now, it is up to you to go to a new car insurance providing company for good quality and desirable features in your policy or select the previous company or agent to get heavy discounts and offers in your policy. If a customer chooses the latter option, he or she can get seventy to eighty percent discount on the insurance policy. So, go out and check for your insurance company to get a good vehicle insurance policy that can make you future bright and secured.