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One of the best ways to lower your Contractors Insurance costs is with a risk management plan..

The first two steps in a risk management plan are 1) identify risks and 2) prioritize risks.

The third step is to determine response strategies, which include avoidance, transference, mitigation, and acceptance. Today we'll delve into transference.

Transference is the act of transferring risk to a third party. The most obvious way to transfer risk is with a comprehensive Contractors Insurance policy, which transfers many risks to your insurance company.

Here are three examples of how to transfer risk to your insurance company:

• Injuries - If an employee is injured on the job, Workers' Compensation – which is required by law in PA and most states – provides wage-loss and medical benefits. If a visitor to the worksite is injured, General Liability Insurance will help cover medical expenses and legal costs if a lawsuit is filed against your business.
  
  
• Physical Damage - If your tools are stolen, a piece of equipment is damaged, or someone vandalizes your office, there are insurances – such as Commercial Property Insurance and Builders Risk Insurance - that help pay the cost to repair or replace those items.
  
  
• Faulty Work - If a client sues you for design errors or omissions, Professional Liability Insurance helps cover your legal costs.

It is also possible to transfer risk to yet another third party, such as a supplier or subcontractor, with contractual risk transfer. "When astutely negotiated, a construction contract can become a valuable risk management tool," the International Risk Management Institute (IRMI) states. "Liabilities can be equitably distributed among the contracting parties—general contractor, subcontractors, suppliers, architects, and the owner."

What is Contractual Risk Transfer?

"Contractual risk transfer is the ability to move a risk/loss from one party to another through the language written in a contract," according to Business Credentialing Services. "Contractual risk transfer is when the language in a non-insurance agreement excuses one party from financial or legal responsibility associated with specified actions, inactions, injuries, or damages. In contractual risk transfer, one party agrees to indemnify and hold another party harmless in a contract."

It's important to note that the Indemnitor – the entity that holds another party harmless if injury or damage occurs - is backed by their insurance policy.

Effective Contractual Risk Transfer

"Unfortunately, many construction contracts are drafted (or standard versions modified) by professionals with little knowledge of insurance coverage," IRMI states. "As a result, it is not unusual for contracts to shift liabilities to the contractor that are extremely difficult or costly to insure, or even uninsurable." Therefore, it is best to leave contract writing to the experts – a qualified attorney and one of the insurance agents at American Insuring Group who specialize in Contractors Insurance can help.

However, it's always good to understand the basics when discussing contracts and insurance with these experts. Here are five tips:

1. Often a contract will require a certificate of insurance; therefore, keeping those certificates well-organized helps save time and frustration.
   
   
2. Make sure whoever drafts your contract is aware of current insurance requirements and doesn't just copy from an existing contract.
   
   
3. Ensure that appropriate endorsements are attached to your contract.
   
   
4. Most states limit the risk that can be transferred.
   
   
5. Four endorsements crucial to the contractual risk transfer process include Additional Insured Endorsement, Primary & Non-Contributory Endorsement, Waiver of Subrogation Endorsement, and Alternate Employer Endorsement.

Work With the Right Insurance Agent and Save

The agents at American Insuring Group specialize in Contractors Insurance and can help execute your risk management plan. As independent agents, we check with multiple insurance companies to ensure you pay the lowest price for your insurance coverage.

Call us at (800) 947-1270 or (610) 775-3848, or connect with us online and start managing your risk today!

Injuries within your restaurant can significantly increase the cost of Restaurant Insurance and other costs, damage your restaurant’s reputation, lower productivity, and more. Therefore, understanding and minimizing the risk of injuries is crucial to business success. One of the most significant risks restaurants encounter is falls. 

According to ISSA, “More than 3 million food service employees and over 1 million guests are injured annually as a result of restaurant slips and falls.” They also report that “slips and falls are the greatest source of general liability insurance claims within the restaurant industry.” 

You may not be able to avoid all slips and falls in your restaurant, but there are steps you can take to minimize the risk. 

1. Install high-traction, slip-resistant flooring. You can confirm slip resistance with a coefficient of friction (COF) audit.
2. Immediately clean up spills, pick items off the floor, and keep walkways clear of clutter.
3. Use maintenance and floor cleaning products with slip-resistant characteristics compatible with your flooring surfaces. Check out the National Floor Safety Institute (NFSI).
4. Pay special attention to permanently installed features, such as carpets and mats. They need to be properly maintained and cleaned to avoid trip hazards. NFSI-certified mats are an excellent investment.
5. Conduct and document regular hazard inspections. Regularly walk around your restaurant looking for hazards, such as wet floors, uneven surfaces, and blocked or dimly lit areas. Document the hazard, when it appeared, and what you did to eliminate it. Documenting this information helps provide proof that you are serious about maintaining your property and keeping it safe for employees and customers.
6. If you discover a hazard that can’t be fixed immediately, alert employees and visitors to the danger with warning signs.
7. Install a surveillance system to monitor for situations that may pose a risk. Cameras can also record accidents to help expedite the resolution of any claims and minimize the risk of false claims.
8. Train employees on established safety procedures, cleaning operations, and inspection procedures. Train workers to apply floor cleaning and maintenance products following the manufacturer’s recommendations. Keep records of all employee training, including individuals trained, subject matter covered, training materials, and the date of the training.
9. Require slip-resistant shoes. A Centers for Disease Control and Prevention(CDC) study concluded, “The findings from this study provide evidence of the effectiveness of slip-resistant footwear and may assist employers, managers, and workers in their decision on whether to invest time and resources in a slip-resistant footwear program.” 

IIf – despite all your best efforts – an injury does occur, immediately ensure that the injured person receives appropriate medical attention, complete an incident report, and notify your insurance company as soon as possible. 

Lower Your Restaurant Insurance Costs!

The American Insuring Group is committed to providing information about Restaurant Insurance and tips to improve safety with our weekly blog. From protecting your restaurant from cyber threats to minimizing the risk of an allergic reaction in your restaurant and from protecting your restaurant against lawsuits to creating a safe outdoor dining space your customers will love (and everything in between), we’re here to help your restaurant succeed! 

In addition, when you work with one of our Restaurant Insurance specialists, we help ensure you have the right coverage for your needs. And as independent agents, we check with multiple insurance companies to ensure you pay the lowest price for that coverage.

✔︎ So call us at (800) 947-1270 or (610) 775-3848, or connect with us online to discover how we can help lower your Restaurant Insurance costs.

In most states, including Pennsylvania, Workers’ Compensation Insurance (WC) is required by law. But, truthfully, even if the insurance isn’t required in your state, WC is an excellent investment as it helps protect your employees and your business.

We’re sure you have a lot on your plate as a business owner or manager, and conducting an annual review of your insurance policies – including WC – may not be high on your to-do list. It’s so much easier to renew the policies you currently have. However, an annual review helps ensure you are not underinsured or overpaying for your coverage.

Here are three steps to make the annual review process as painless as possible.

Step 1: Review Your Business

Look at how your business may have changed since you purchased your existing WC policy. Ask yourself the following questions:

1. Did your business needs change? For example, did you switch from an independent contractor to an LLC?
2. Did you hire new employees or let old employees go?
3. Has the classification code for any of your existing employees changed?
4. Has your payroll changed?

Step 2: Look at Your Current Policy

The next step is to take a look at your current WC policy, keeping in mind how your WC premium is calculated:

WC Premium = Classification Code Rate X Experience Modifier X payroll/$100

Look at the declaration page to see how your workers are classified and the estimated payroll for each, and determine if this information is still accurate.

Classification Codes - A classification code is a 3-digit number assigned to every type of job. It is based on the likelihood of that employee being injured on the job and helps determine your WC premium. Typically, the more risk of injury, the higher your WC costs. Therefore, assigning the wrong classification code can lead to overpayment, insufficient coverage, or even WC fraud.

Payroll - “Initially, the payroll used to calculate your premium is an estimate. Once your actual payroll has been determined, adjustments may have to be made, and you could be audited and billed accordingly,” Pennsylvania Insurance Department reports.” Any changes to your business within the policy term that affect the rate of your policy can lead to an audit and possible billing.”

Experience Modifier - Finally, review your loss run report, which shows your company’s claim activity for the policy period. Loss Run Reports list the date of each loss and claim, a brief description of each claim, the amount paid to the insured, and whether or not the claim is closed. You can think of it like a credit report or report card for insurance companies.

This information is used to determine how risky a business is to insure, which can affect the premium you pay for insurance or even if an insurance company will issue a policy or renew a policy for your business. You can use the information to lower your insurance costs and even improve other areas of your business.

Step 3: Renew Your WC Insurance (Contact us for great rates!)

Armed with this information, you are ready to renew your WC coverage and ensure that you have the right coverage at the best price.

American Insuring Group agents have years of experience with Workers’ Compensation and other commercial insurance policies to ensure that you get the right coverage for your business needs. As independent agents, we check with multiple insurance companies to ensure you pay the lowest premium for that coverage.

✅ So give us a call today at (800) 947-1270 or (610) 775-3848, or connect with us online.

Many drivers become owner-operators, so they can be their own boss and set their own hours, but being an owner-operator also comes with certain responsibilities, such as obtaining a USDOT number and purchasing the right Truck Insurance.

As an owner-operator, you are a self-employed truck driver with your own commercial trucking rig. You are a business owner who needs to protect your business with the right insurance. Whether you are an owner-operator under a permanent lease or an owner-operator with your own authority, there are both required and recommended types of insurance coverage you should have.

For example, interstate and intrastate carriers are required to file proof of insurance with the Federal Motor Carrier Safety Administration (FMCSA), including commercial auto liability insurance from $750,000 to $5 million (depending on what type of cargo you are transporting). Some states and contracts will also require additional types of insurance.

Beyond these requirements, what (and how much) insurance you should have to protect your business can vary. Here are seven insurance coverages owner-operators should consider:

Collision Insurance 

Collision Insurance insures against damages to your truck and other vehicles in a collision-type accident.

Comprehensive Insurance

Comprehensive Insurance covers damages or losses that are not the result of a collision—vandalism, theft, fire, etc.

Commercial Liability Insurance

Commercial Liability Insurance protects you against loss from legal liability resulting from bodily injury or property damage to another party.

Cargo insurance 

Cargo insurance protects against loss from legal liability for damage to goods or merchandise in your care and custody while in transit. It also provides coverage for things like debris removal and refrigeration breakdown. 

Non-trucking coverage 

Non-trucking coverage is for those things that are not directly related to the trucking operation. For example, this coverage would include an occupational accident for the truckers and insurance for trucks that drive without cargo (i.e., the cargo has been delivered, and the truck is coming back empty).

Trailer Interchange Insurance

Trailer Interchange Insurance is available under the trucker's or the motor carrier policy form that covers the insured's legal liability for damage to the trailers of others. Coverage is also available, by endorsement, under the business auto policy (BAP). Under a trailer interchange +agreement, the motor carrier in possession of the trailer is responsible for any damage to the trailer, even if the trailer is not attached to the tractor.

Uninsured/Underinsured Motorists Coverage

Uninsured/Underinsured Motorists Coverage helps pay for damage to your trick if someone hits you and does not have liability coverage.

In 2020, according to the National Safety Council (NSC), 4,842 large trucks were involved in fatal crashes, and 107,000 large trucks were involved in crashes resulting in injury. Without the right insurance, one significant accident can quickly put you out of business; therefore, it's crucial that you protect yourself, your business, and those around you with the right insurance coverage.

How to Get the Right Insurance Coverage at the Lowest Cost

At American Insuring Group, we go beyond providing you with affordable truck insurance. First, we carefully analyze the needs and risks associated with your business. Then, we match you up with the best trucking insurance policy based on a careful analysis of many competing insurance companies.

The result? You'll get the high-quality commercial insurance coverage you need at a very affordable price. Therefore, if you want the right insurance coverage at the lowest cost, call us at (800) 947-1270 or (610) 775-3848, or connect with us online.

Have you ever thought about why you purchased Contractors Insurance? It may have been to protect your business, equipment, employees, and more. It may have been required – by law, a customer, etc. Whatever the reason, everyone wants to get the most they can out of their insurance.

Check out these 7 tips to discover how to get the most out of your insurance coverage.

Identify Risks and Determine Response Strategies

First, you need to identify your risks, determine which could have the most significant impact on your business, and decide on your response strategies, which may include one or more of the following:

• Avoidance – If you determine that a project is too risky or your business is not equipped to handle the risk, you may decide to decline the project or change the scope of the work.
• Transference – Sometimes, you can transfer the risk to a supplier, subcontractor, or insurance carrier.
• Mitigation – Mitigation is the act of reducing the severity, seriousness, or painfulness of something. For example, providing a safer worksite will help mitigate safety risks.
• Acceptance – Sometimes, you may be willing to accept a potential risk and develop a contingency plan as a workaround. 

Mitigate Risk

Mitigating risk – and thereby reducing the number of claims – is one of the best ways to lower insurance (and other) costs. American Insuring Group offers many blogs to help, such as 10 Hand and Power Tool Safety Tips, How to Minimize and Protect Your Construction Company from 3 Top Risks, and Choosing Appropriate PPE for Construction Workers. 

And the good news is that mitigating risk also leads to more productive employees, happier customers, a better business reputation, and a healthier bottom line. 

Understand Your Insurance Policy

We realize that most people do not find reading their insurance policy a fun activity, but it's a must if you want to get the most out of your coverage. You need to understand what your policy does and does not (exclusions) cover so that you can compare any gaps with your response strategies and available cash flow. You may need to purchase an additional policy, add an endorsement to extend your coverage, or consider an umbrella policy to increase your current policies' limits. 

You should also understand your deductibles and ensure that you have enough available cash flow to cover those deductibles if you make a claim. 

Combine Policies

It is tempting to shop around and find the lowest premium on each of your policies, but you will often find more savings by combining your policies with one company. The independent agents at American Insuring Group will compare the cost of your policies with multiple insurance companies to ensure you pay the lowest premiums. 

Review Your Policies Regularly

You know the old quote, "There is nothing permanent except change," and this is certainly true in business. You may buy or sell a piece of equipment. You may increase or decrease the number of employees. All of these changes can affect your insurance coverage and premiums; therefore, regularly reviewing your policies is the only way to ensure that you have the right coverage at the lowest cost. 

Advertise Your Insurance Coverage

Advertising your insurance coverage – on your website, social media profiles, truck advertising, etc. – shows that you are a professional and can help get more customers. You should be happy to provide your customers with a certificate of insurance as proof that you have insurance coverage that will pay for any injuries, damage, etc. 

Work With an Experienced Insurance Agent and Save!

The independent agents at American Insuring Group specialize in Contractors Insurance and can ensure that you have the right coverage for your needs. Plus, as independent agents, we check with multiple insurance companies to ensure you pay the lowest price for that coverage!

So give us a call today at (800) 947-1270 or (610) 775-3848, or connect with us online.

Creating a safe workplace helps protect your business, maintain a good reputation, and lower the cost of Restaurant Insurance and other expenses. Safety should be a priority in any industry, but perhaps more so in restaurants where many potential hazards exist - sharp knives that can cause injuries, hot fryers that can trigger fires, food that can become contaminated, etc. 

If you want your business to succeed, you must be diligent about creating and maintaining a safe restaurant. So here is – as they say – the proof in the pudding:

• According to the U.S. Bureau of Labor Statistics, in 2019, there were 93,800 nonfatal injuries and illnesses in full-service restaurants, with about one-third requiring at least one day away from work.
  
  
• According to the National Fire Protection Association (NFPA), “U.S. fire departments responded to an estimated average of 7,410 structure fires per year in eating and drinking establishments between 2010 and 2014. These fires caused average annual losses of three civilian deaths, 110 civilian injuries, and $165 million in direct property damage each year.”
  
  
• According to the National Library of Medicine, approximately 48 million cases of foodborne illness occur in the U.S. every year, resulting in about 128,000 hospitalizations and 3,000 deaths. Furthermore, between 2006 and 2007, about 66% of foodborne disease outbreaks reported were associated with restaurants. 

How Does a Safe Workplace Benefit Your Restaurant?

Creating a safe restaurant protects and benefits everyone - your restaurant, employees, customers, and the community.

Here are a few of the benefits to your restaurant:

• Improves your bottom line. Experts report that safety and health management systems reduce injury and illness costs by 20-40%, and employers can save $4-6 for every dollar they spend on safety and health programs. Plus, of course, fewer claims mean lower WC premiums.
• Increases productivity. Fewer injuries lead to lower absenteeism and turnover and higher employee morale.
• Saves time. It takes time to repair or replace damaged equipment, hire and train new employees, etc. 

Employees also benefit from a safe workplace with less pain and suffering, less stress, and better quality of life for themselves and their families. Finally, safe workplaces benefit your community by creating attractive employment opportunities and restaurants people want to frequent. 

How to Create a Safer Restaurant

There are plenty of things you can do to create a safer restaurant, and American Insuring Group is here to help! Here are ten blogs devoted to restaurant safety. Check out these and more blogs about safety and Restaurant Insurance.

1. 8 Restaurant Safety Tips to Lower Insurance Costs
   
   
2. How to Prevent Fires in Restaurants
   
   
3. A Clean Kitchen Can Reduce Restaurant Insurance Costs
   
   
4. 5 Tips to Minimize the Hazards of Commercial Deep Fryers
   
   
5. 6 Knife Safety Tips for Restaurant Owners
   
   
6. Minimize Food Delivery Risks for Lower Restaurant Insurance Costs
   
   
7. PPE to Lower Insurance and Other Operating Costs in Restaurants
   
   
8. 3 Food Safety Tips to Reduce Risk and Insurance Costs
   
   
9. Slip-Resistant Shoes Help Lower Restaurant Insurance Costs
   
   
10. Food Allergies and Restaurant Liability Insurance

The Fastest Way to Lower Your Restaurant Insurance Costs

Call American Insuring Group at (800) 947-1270 or (610) 775-3848, or connect with us online to discover how our independent agents can help you lower your Restaurant Insurance costs. They compare costs among many competing providers to help you get quality coverage at the best price. Call today.

Most states – including Pennsylvania – require nearly all employers to carry Workers' Compensation (WC) Insurance, but shopping for WC insurance can be frustrating. American Insuring Group is here to help simplify the process and ensure you have the right coverage at the lowest cost.

What is Workers' Compensation Insurance?

Before we get into the nuts and bolts of purchasing WC Insurance, let's discuss what it is and how your premium is calculated. We will focus on PA WC, but many other states are similar (see first tip below).

The PA Department of Labor & Industry states, "The workers' compensation system protects employees and employers. Employees receive medical treatment and are compensated for lost wages associated with work-related injuries and disease, and employers provide for the cost of such coverage while being protected from direct lawsuits by employees."

In Pennsylvania, whether you have one employee or one hundred employees, full or part-time employees, or your employees are family, you are probably required to have Workers' Compensation Insurance. There are few exemptions, such as railroad workers, federal employees, domestic servants, etc. Failure to provide WC for your employees can lead to significant fines, lawsuits, and even criminal prosecution.

Your Pennsylvania Workers' Compensation premium is based on the following formula:

WC Premium = Classification Code Rate X Experience Modifier X payroll/$100

Here are seven tips for purchasing WC Insurance to ensure you have the right coverage at the lowest cost.

Know What Your State Requires

Your state will determine whether or not you are required to carry Workers' Compensation Insurance, the WC regulations you need to follow, and how you can purchase the insurance. Click here for a state-by-state comparison and links to the entities responsible for Workers' Compensation. And remember, even if you are not required to purchase WC insurance, it may be worth having.

Provide Your Existing Policy

If you already have WC coverage, keep your policy handy. Providing information – such as your employees' class codes, your experience modifier, and loss run reports – from that policy can help expedite the process.

Choose the Right Classification Codes

As shown in the formula above, the classification code will affect your WC premium. Classification codes are based on the likelihood of an employee being injured on the job. For example, the classification code for an accountant or someone with administrative responsibilities will represent less risk than a classification code for a driver or contractor. Typically, the more risk of injury, the higher your WC costs.

You don't want to misclassify an accountant as a driver because you'll pay more than necessary for your WC coverage. On the other hand, you don't want to misclassify a driver as an accountant because if caught during the annual audit or a claim, you may be required to pay the outstanding amount owed and/or severe penalties.

Monitor Your Payroll

When purchasing WC coverage, your annual payroll will be estimated based on your current circumstances, which of course, can change. When your insurance carrier conducts its annual audit, you may receive a credit or a bill based on the actual payroll. Monitoring and reporting your payroll throughout the year can help improve your business cash flow.

Ask About Discounts and Credits

Yes, your WC premium is based on the formula above, and most of the components of that formula are out of your control. However, you may be entitled to discounts and/or credits for lowering risk with workplace safety or formal training programs.

Review Annually

Your insurer will conduct an audit each year, and so should you. It's an opportunity to check for errors and provide any updates. Reviewing your loss run report – a report issued by your current insurance provider that shows your company's claim activity for the policy period - may also help lower your WC insurance costs.

Work With a Workers Comp Expert!

Working with an independent agent with experience in Workers Compensation insurance at American Insuring Group is a great way to lower your WC costs. We will compare costs and options among competing worker's compensation insurance carriers to be sure you get the right insurance at the best price.

Call today at (800) 947-1270 or (610) 775-3848, or connect with us online.

Most truck owners and fleet managers understand the importance of Truck Insurance to protect their business, employees, vehicles, etc. For example, Primary Liability Insurance (Aka Trucking Liability Insurance) helps cover the cost of injuries to other people or damage to other vehicles in the event of an accident. General Liability Insurance helps protect your business from the cost of lawsuits. Cargo Insurance helps cover the loss or damage to cargo in transit. And the list of truck insurance options goes on.

Every truck and fleet has unique insurance needs, and there is no one-size-fits-all when it comes to Truck Insurance. That is why working with one of the experienced agents at American Insuring Group is crucial to business success.

Two types of insurance available to truck owners and fleet managers that are often used interchangeably are Umbrella Insurance and Excess Liability Insurance. The two are similar but slightly different. Let’s start with definitions provided by the International Risk Management Institute, Inc. (IRMI).

IRMI Definitions

Excess Liability Insurance — (1) A policy or bond covering the insured against certain hazards and applying only to loss or damage in excess of a stated amount or specified primary or self-insurance. (2) That portion of the amount insured that exceeds the amount retained by an entity for its own account.

Umbrella Liability Policy — a policy designed to provide protection against catastrophic losses. It generally is written over various primary liability policies, such as the business auto policy (BAP), commercial general liability (CGL) policy, watercraft and aircraft liability policies, and employers liability coverage. The umbrella policy serves three purposes: it provides excess limits when the limits of underlying liability policies are exhausted by the payment of claims; it drops down and picks up where the underlying policy leaves off when the aggregate limit of the underlying policy in question is exhausted by the payment of claims; and it provides protection against some claims not covered by the underlying policies, subject to the assumption by the named insured of a self-insured retention (SIR).

A Comparison of Excess Liability and Umbrella Liability

Those definitions are a good place to start, but let’s dive a little deeper and simplify them simultaneously. Both are designed to provide additional protection on claims. Both are additions to underlying policies designed to protect against particular risks and specific losses and are only triggered when the underlying policy line of insurance has been exhausted.

Commercial General Liability (CGL) Insurance is an example of an underlying policy. Every CGL policy has a financial limit. For example, if you have a $1 million limit on your policy and get sued for $1.2 million, you (not the insurance company) will be responsible for paying the difference. Either an Excess or Umbrella policy may help cover the difference.

Every policy also has a unique scope of covered risks and specific losses. If a loss occurs outside of those covered risks, insurance will not pay, and the financial responsibility will fall to you. However, an Umbrella Liability policy may provide protection against some claims not covered by the underlying policies. An Excess Insurance policy will not. An Excess Insurance policy is focused on financial limits and does not expand the terms or scope of the underlying policy.

If you are a driver with just one truck or a business with a small fleet, you may think either type of insurance would be a waste of money, but consider this: the Federal Motor Carrier Safety Administration (FMCSA) reports, “The average cost of a large truck crash involving a fatality is $3.6 million per crash.”

Is Umbrella Liability or Excess Liability Insurance Right for me?

As we said earlier, every business’s insurance needs are unique. The best way to ensure you have the right insurance at the lowest cost is to work with one of the experienced, independent agents at American Insuring Group. We compare policies from multiple insurance companies to ensure you get the right protection at the right price!

Call today at (800) 947-1270 or (610) 775-3848, or connect with us online.

There are many types of Contractors’ Insurance designed to protect your business from unforeseen circumstances. However, one type of insurance that is somewhat unique to the construction industry is Builders Risk Insurance. 

What is Builders Risk Insurance?

Builders’ Risk Insurance - also called Course of Construction Insurance or Inland Marine coverage – is a temporary insurance policy that helps protect a renovation or new building while under construction. It typically covers a building, structure, materials, tools, and equipment on a job site, in transit, or stored elsewhere during construction or renovation. 

The following perils are typically covered under a Builders’ Risk Insurance policy:

• Theft
• Vandalism
• Fire
• Explosion
• Vehicle accident 
• Weather events, such as hail or lightning

Some Builders’ Risk policies also include the following perils:

• Costs incurred by delayed construction, such as lost rental income or loan interest
• Removal and disposal of pollutants
• Damage to temporary structures
• Changes required to meet environmental standards 

The following perils are typically NOT covered under a Builders’ Risk policy:

• Wind
• Earthquake
• Flood
• Employee theft
• Normal wear and tear
• Mechanical breakdowns
• Terrorism
• Faulty work or materials
• Contractual penalties 

When Does Builders Risk Insurance Coverage End?

Most insurance policies have an insurance policy period that includes an effective and expiration date. Simply stated, those dates indicate when coverage from that policy begins and ends. However, the end date of a Builders’ Risk Insurance policy can be a little more complicated. 

Because the value of a structure being built or renovated increases over time, Builders’ Risk insurance factors this changing value into its pricing. Due to this unique situation, there are times when an expiration date may change. 

1. The owner of the property takes over

If an owner (such as the original property owner, bank, or purchaser) takes over the project (regardless of how complete the project is), the Builders’ Risk Insurance policy you purchased becomes invalid. 

2. The Project Is Abandoned

If the contractor walks away from the site with no intention of completing the project, the Builders’ Risk Insurance policy becomes invalid. 

3. The Property is Being Used for Intended Purpose

If all or part of the property is being used for its intended purpose during construction, the Builders’ Risk Insurance policy becomes invalid. 

4. The Project has been Completed for 30 Days

Once an occupancy permit or other completion confirmation has been issued, the Builders’ Risk Insurance policy becomes invalid. 

Once the Builders’ Risk Insurance policy has expired, other types of insurance are available to protect the property, which are often less expensive. For example, property insurance can be purchased when the property is being used for its intended purpose or when the project has been completed for thirty days, which is typically less expensive than Builders’ Risk Insurance. On the other hand, if a property has been abandoned, there is more risk for damage such as decay, vandalism, break-ins, and arson. Therefore, insurance to cover the property will be higher than Builders’ Risk Insurance.

Need Help With Builders’ Risk Insurance?

If you have questions about Builders’ Risk Insurance or any type of Contractors Insurance, be sure to speak with one of the experienced agents at American Insuring Group.

Not only do we specialize in Contractors Insurance, but as independent agents, we also compare multiple insurance companies to ensure you pay the lowest premium for the coverage you need.

Call today at (800) 947-1270 or (610) 775-3848, or connect with us online.

Savvy restaurant owners purchase Restaurant Insurance to help protect their business, but insurance policies and claims can be complicated. The experienced agents at American Insuring Group can help you navigate your insurance options, policies, and claims.

However, it’s helpful to understand and avoid the most common errors restaurant owners make when filing an insurance claim:

Not Understanding Your Policy

Your insurance policy states explicitly what “perils” it does and does not cover. It can be extremely frustrating to discover something you thought was covered isn’t when you go to make a claim (not to mention the time wasted making a claim while also trying to recover from the incident).

Therefore, you need to read and understand what your policy does and does not cover, so you can either fill the gap or have a plan in place if an uncovered event occurs. Ask your insurance agent to clarify anything you’re unsure of. 

You should also know your policy’s deductible – the amount you must pay before insurance kicks in on a claim. If you decide to increase your deductible to lower your premiums, make sure you have enough available cash to cover that deductible if you need to make a claim. 

Finally, it’s crucial to understand if your policy values damaged property according to an actual cash value (factors in depreciation and normal wear and tear) or the replacement value (does not factor in depreciation and normal wear and tear). If the damaged property is valued according to actual cash value, you need to be prepared to pay the difference out of pocket. 

Not Filing a Claim Promptly

If someone is injured in your restaurant or your oven is damaged by fire, call your insurance company immediately. Waiting to file the claim can make the process more difficult or even lead to having the claim denied. A good rule of thumb is to file a claim within the first 48 hours of an incident, but the sooner, the better.

Not Working with Insurer

Don’t think of your insurance adjuster as the enemy. Be professional, polite, and cooperative, and promptly provide whatever documentation they request. Failure to cooperate may provide grounds to deny a claim. However, don’t be afraid to ask questions or even appeal an estimate if you have reasonable proof that the lost property is undervalued. 

Not Documenting Damage and Claim

You will need proof of damage to receive a payout, so immediately record the time and date of the incident and take photos and/or videos of the damage. Also, document your communication with your insurer – keep a record of mailed correspondence and emails along with the time, date, and substance of verbal communications. 

Disposing of Damaged Items

You may think photos will be enough when filing a claim, but you should also keep the damaged property as physical evidence until the claim is closed. 

Admitting Fault

Never admit fault if someone is injured in your restaurant. There are too many frivolous lawsuits, and you may not honestly know the cause of an incident until it is investigated. In addition, accepting responsibility will make it difficult for your insurer to defend you if there is a lawsuit. Plus, some policies don’t allow you to assume fault without the insurer’s consent. With these policies, admitting fault can lead to a breach of contract, denial of a claim, or termination of coverage.

 Paying Claims Out of Pocket

You may be tempted to pay the medical costs of someone injured in your restaurant. However, your insurance policy will not reimburse you for payments made out of pocket and could even result in a denied claim. 

Want to Save on Restaurant Insurance Costs?

Work with one of the experienced independent agents at American Insuring Group. We can answer any of your questions, and – as independent agents – we compare pricing and coverage with multiple insurance companies to make sure that you pay the lowest premium for your insurance coverage!

Call us today at (800) 947-1270 or (610) 775-3848, or connect with us online.