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2006-2007

Now more than ever it is important for you to have your commercial insurance with the best possible local independent agent. The insurance companies are still garnering large profits from the premium increases they were able to obtain during the recent "hard" market that were only partially offset by prior year loss reserve increases and escalating medical costs. Now they wish to sustain or increase their profits by writing new business on an aggressive basis although their underwriting is still "tight" regarding some coverages, certain classes, specific lines and geographic areas.

Considering the present state of flux your independent agent representing several insurance companies should be in the best position to evaluate the marketplace and select the best companies for your account based upon price, coverage and stability and present options to you so that you can make an educated decision. Just remember that the incumbent carrier probably will initially offer a conservative renewal quotation but may reduce the price rather than lose a good account.

However while the insurance picture may be brighter for commercial accounts from a premium standpoint, insurance companies are imposing more restrictions and exclusions than ever before. For example exclusions such as construction defect, residential construction, EFIS (Exterior Finish and Insulation System), silica, asbestos, mold, lead paint, subsidence and pollution are common. In some cases risk management transfer techniques may help you to mitigate some of these self-insured exposures or if not in you favor they may increase the self-insured risk of others that you assume under contract.

The insurance company marketplace is still undergoing changes as consolidation and mergers continue. The net result is that there are fewer "players" for the commercial insurance buyer this year thus reducing a client's options so that your agent should represent a number of national and regional insurance companies. Make sure that yours does!