Increasing Business Insurance Costs
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Increasing Business Insurance Costs
Did you know that property and general liability insurance rates are on the rise? At WPMA we can show you what you can do to minimize increases for your business.
For years insurance companies with little or no experience in the woodworking industry thought this would be a good market to generate additional premium. The result was that these companies often offered prices that were below where they should have been. The niche carriers that write wood related businesses on a regular basis were forced to lower prices to remain competitive with the marketplace and retain the customers they had.
After a number of years these carriers are seeing higher than expected losses and are exiting the marketplace. The increase in claims can often be attributed to the fact that companies did not have the available cash to do preventive maintenance, which often resulted in claims. Companies decided to take their chances that they would not have a loss. Now rates are increasing 5-15% and in the case of sawmills, upwards of 30-40% increases are not unheard of.
What companies can do to minimize their potential for large price increases are to operate as clean and safe an operation as possible. Demonstrating to the insurance company that you have an active safety committee and are doing as much preventive maintenance as possible goes a long way at renewal time. Also, those companies with commercial auto policies should maintain their training and upkeep on vehicles. Remember, the old saying, an ounce of prevention is worth a pound of cure. In this case it equals dollars and cents.
The WPMA maintains and active safety group with our partner, Indiana Lumbermen’s’ Mutual Insurance Company (ILM). The program has the potential to pay up to 10% cash dividends on eligible lines of coverage and has been averaging a 6% cash dividend for the life of the program. It is one of the ways we work to help companies affect their bottom line.
If you have questions or need more information contact Philip Bibeau at 978-874-5445 or woodprod@wpma.org
Source: www.ilmgroup.com