Customize your coverage

Get a better grasp on your insurance options to create a package that’s right for your company.

Photo courtesy of Coastal Greenery

Insurance. It’s a word that makes me uncomfortable only because I personally do not enjoy paying for the “what if” to happen.

I am somewhat of a controller and I felt like Coastal Greenery was being held hostage by insurance companies. All of this thinking had to be altered because doing business as a landscape company means that our company has to be protected. I had to leave my personal issues with insurance behind and make certain that Coastal Greenery was insured and prepared for the day when we would have a claim.

So instead of fighting insurance, I learned all that I could and in doing this I found we were not captives to insurance; we did have choices and options. Coastal Greenery has had some hard lessons learned when it comes to insurance but we were able to take away a few useful tools to help us navigate the insurance world.

Choose a smart broker.

An insurance broker represents your company in purchasing and negotiating with insurance carriers.

Find a broker who knows the landscape business and the situations that you are up against daily. Let’s face the facts. We know landscapes, not insurance so choosing a broker is not an area where you want to tread lightly.

Know your policies.

Your broker should go over every policy and what they mean in layman’s terms with you. This is not a time for you to be quiet. Ask questions.

Our general liability policy had coverage that I finally questioned after a year or two and found out that “terrorism” coverage didn’t have to be included in our policy, thus saving us few dollars.

Understand the types of coverage.

General liability is insurance coverage to protect a company from a variety of losses that can arise while you are in business. Areas that are covered within the GL policy should be designed to fit your company’s needs, so to speak and can include:

Protection of property: The ways in which property can be damaged are endless so it is much easier for you to know what is not covered by your policy than what is covered.

Coinsurance: A clause in a policy which you must know and understand. Coinsurance has a few meanings in the insurance world so make sure you know how it relates to your policy. This is one of those areas where not understanding could leave you penalized in the event of a loss.

Commercial liability: Covers damage to third parties that the company becomes legally obligated to pay. Years ago our company found this coverage to be well worth the money. An employee didn’t dilute a chemical he applied to turf on a property and, needless to say, our commercial GL coverage paid for the labor and materials to re-sod this property. A business owner not carrying this coverage could result in business suicide.

Business automobile: This coverage is the same as personal auto insurance and can include liability, comprehensive and collision. Save some money by taking a look at the trucks within your fleet and determine if the older trucks need full coverage. If totaled, would you receive enough money from the policy to replace the vehicle or is the cost of insurance more than the value of the vehicle?

Inland marine: This coverage involves the tools and equipment a company owns and uses to do business. You will need to have the insurance company define for you what they consider a “tool” and a piece of “equipment.”

Workers’ compensation is insurance provided to employees who sustain a work-related injury. State law requires most employees to carry this coverage. This coverage is another policy that if your business doesn’t have it, you could be committing business suicide.

Umbrella policies are policies that are carried on top of your general liability coverage to increase limits. Umbrella policies are really a determination of the business owner and need to be carefully thought out. A great reason to carry an umbrella policy would be for a business owner to obtain extra personal insurance to cover their personal assets from being targeted from a claim that is attached to their business.

Additional insurance tools.

Have one individual in the company “own” the insurance process and be the “go to” person for insurance.

Keep an inventory of all equipment and include serial numbers, VINs, dates of purchase, purchase price, etc. The more key information you have, the better your chances of recouping your loss on equipment.

Small tools can be inventoried by crew with little information other than type and brand needed.

Keep records of all employees who drive company vehicles. Run a motor vehicle report on driving employees upon hire. Make certain that you have the employee sign an MVR agreement giving you permission to run the report and make a clear copy of the driver’s license.

Have a vendor/contractor agreement signed by all subcontractors that you hire and keep it on file before they step foot on your job site. With this agreement, they agree to carry insurance coverage and will provide you with updated insurance certificates. These agreements release your business from any and all liability if they or their employees are injured on the job.

Keep in mind that any contractor on your job site is considered your employee by WC and you will be charged for their work during your yearly WC audit unless the contractor carries WC insurance.

Make safety training a priority and hold weekly, if not daily, safety meetings. Enforce safety on all job sites and at your facility. Hold all employees accountable for safety violations and reward employees who display safety on the job.

Maintain a drug-free workplace. Test for drugs upon hire, periodically, after accidents and when speculation arises. Maintaining a drug-free workplace will lower your WC insurance in some states.

Each year your company is given an MOD score that reflects the accidents that have occurred in the past year. This “company report card” can affect your WC rates for three years as each incident stays on your MOD for three years.

Since 1994, my view on insurance has changed. Although I do not like paying the high premiums every month, nor do I enjoy being audited every year to basically pay additional premiums, I do feel confident that if and when an accident occurs, we are covered.

It is a must for a business owner to protect their company and employees with the proper insurance coverage. Let’s face it: there are a few certainties in the landscape world, namely weeds, taxes and insurance.

October 2016
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