Underwriter's Corner
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I thought I'd take a couple minutes to expand on a market that not enough agents seem to be familiar with and many seem to have questions about. That market is MAXUM Casualty Insurance Company (referred to as "MAXUM"). MAXUM may ask a couple of questions that others don't ask and look at a risk in a different way, compared to other conventional trucking insurance companies, but they have developed a philosophy that appears to work. I'd like to help you get to know them better.
What is MAXUM looking for? In their own words: MAXUM's target account is a stable, well-run insured with high quality and "happy" drivers due to the more predictable and comfortable nature of routes and loads.
They want to see the accounts where the trucking company is contracted by regular shippers a large majority of the time. When it comes to acceptability, it isn't a matter of whether the radius is local, intermediate, or unlimited so much as they care whether their shippers send them on regular routes (repeated over and over), or "controlled" routes. By controlled routes, we're implying that the insured works with shippers who have some customer base and request deliveries, that must go to those customers when needed. They would not be considered regular routes because there is no regularity with the delivery, but the insured, or insured's driver has, in most cases, been to the customer before. Therefore, they feel familiar to where their destination is, and familiar with the type of loads they take to those destinations. The insured could be dealing with one shipper exclusively, or there could be many shippers. They could have a shipper that sends them out and back or possibly a different shipper gives them a return trip. Sometimes, however, it is one of their regular shippers that gives them an outgoing trip, and then they may pick up a return trip from a broker. The thought process behind this is that one of the best measures of stability is how long the trucker has maintained a relationship with their shippers and brokers. The longer the relationship, the more revenue the trucker generally can earn per mile and the more regular the destinations seem. Maybe this whole thing might be better approached by describing what they're not looking for. They are not interested in the un-established or new trucking company with a relatively new relationship with a freight broker that will invariably send them on irregular routes to and from different cities with no consistency in type of cargo they are asked to haul.
The program is competitive for most non-hazardous dry, refrigerated or flatbed freight.
This is pretty self explanatory. If the account fits with other aspects of the program, it can be competitive for most types of cargo. Their prohibited cargo list is very similar to most other carriers.
MAXUM's best priced risks are well run businesses with a low percentage of replacement drivers hired in the past year. There drivers are afforded the opportunity to make a competitive income by transporting loads with newer rigs on familiar routes.
MAXUM driver guidelines and qualifications are similar to most other companies. The drivers are entered individually in their rating system and the overall quality of the drivers will result in a modification to the premium. Consequently, a higher percentage of "Clean" drivers lead to a lower priced account (all other factors being equal). Furthermore, the presence of a low driver turnover percentage reflects how "happy" the drivers are - since happy drivers don't have as many claims. Of course some of these other factors that make them happy also contribute to fewer claims. A couple of these things are familiar routes (see above) and the newer, average age of tractors or trucks. Familiar routes means they don't do a lot of extra driving being confused, lost and distracted (by continually reading a map). The newer equipment usually means fewer maintenance problems so they don't spend valuable time broken down on the side of the road somewhere away from home.
Some of the other requirements of quoting a MAXUM account:
- Must have quarterly IFTAs on accounts over 5 power units, preferably showing the number of units they represent. (They can quote 1 - 5 unit accounts without IFTA's if we find the regular destination cities and revenue.) Being able to review the most recent IFTA's on a well-run truck account almost always results in MAXUM being able to produce a more competitive quote. Remember, MAXUM pricing is not really predicated by radius of operation as much as miles per truck. They use IFTA's to verify where the insured travels and number of miles per truck. It only stands to reason that the fewer miles they travel, the less exposure to claims they'll have.
- On accounts over 5 units, current year plus 3 prior years of currently valued company loss runs. (Doesn't everyone want these?) On accounts under 5 units without a BI claim in the past 3 years, MAXUM doesn't require loss runs. (Nobody else does that!) MAXUM doesn't get scared off by a large claim if it appears like it was something unusual and unlikely to happen again. In fact, MAXUM pricing varies little on losses of smaller accounts. Their Underwriters don't usually price any additional premium for non-moving or not at-fault accidents (CWP).... Nor do they include animal hits.
- MAXUM Supplemental Application (with any other company's completed application). This supplemental asks those questions which provide the scenario suggested above, such as shippers, routes, use of brokers and so forth.
- The driver list needs to have the name of the driver, the date of birth, the years of driving experience (in the type of vehicle he/she is driving for the insured) and the DATE OF HIRE. This should accompany a current MVR.
Some added features to MAXUM
- The Claims staff is second to none as every claims examiner at MAXUM has many years of experience adjusting trucking losses. Unlike other trucking insurers, you won't find examiners who were moved over from personal lines auto or general liability departments and don't understand the business of the trucker. MAXUM prefers a "boutique approach" to handling claims and uses only the best repair shops and attorneys to make sure the truckers business is not adversely affected by a claim.
- MAXUM offers broad coverage including automatic TEMPORARY REPLACEMENT COVERAGE for physical damage. Unlike other insurers, this means if an insured puts a truck in the shop for service, they can go out and rent a truck and be provided automatic coverage. This is a especially nice feature if the insured also purchases RENTAL REIMBURSEMENT coverage so they incur no out-of-pocket costs
- For 1 and 2 unit accounts, you can add their "MAXUMIZED COVERAGE". This adds coverage for Hired Liability and Cargo coverage ("if any" basis) along with Non-Owned Liability. It also gives you Broadened Rental Reimbursement, Unlimited Earned Freight and Increased Removal Expenses ($50,000 max). Ask your underwriter for more details.
- Non Trucking Liability Coverage is available
- Optional payment plans offered.
So, are you clear on what they are looking for? Well, if not, send it in to us anyway and we'll work with you to get the job done.
We currently write MAXUM in OHIO, Pennsylvania, Indiana and Michigan
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Past Articles Click past article titles to see the whole article.
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There are a few
things in the insurance industry that seem to remain relatively
predictable:
- Once you feel you completely understand a coverage line or product
it will be changed!
- The marketplace will continue to be cyclical with the soft market
years always outlasting the hard market.
- There are ways to write business with the people that you have had
the opportunity and taken the time to develop relationships with as you know
they will be there for you no matter what the market conditions.
We at Interstate work hard to develop and maintain relationships
with you - our valued agents. We have been here for you for over 37
years diligently providing access to markets that offer the coverages your
insureds need through strong, financially sound carriers. We are not and
have never been a company that jumps in and out of the marketplace.
We
are always looking for new markets that give us the opportunities to open
doors for you to meet the needs of your customers no matter what type of
business they are in. We have recently begun writing with Ironshore
Specialty and United Specialty Insurance Companies for property including
excess flood, inland marine and general liability coverages. These
carriers have a very broad appetite and are a great addition to our current
property and casualty markets.
We want you to know that you can
depend on us to be here for you whether it is 4:55 on a Friday afternoon or if
your insured needs coverage immediately (aka "yesterday"). It is very
easy in todays fast paced electronic world to lose sight of the importance of
relationships with the people that make things happen for you and are there
through thick and thin. People you can count on.
While we
continue to strive to provide you with access to quick and easy processes such
as on line certificates, endorsement requests and applications, please
remember that our knowledgeable, friendly staff are just a phone call away
ready to work with you no matter how simple or complex the account.
Why
not pick up the phone now and give us a call on that account you are currently
working on?
Connie Kennedy, P&C - Underwriter Manager
connie@interstate-insurance.com
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Our agents spoke and Interstate listened!
In the past, submitting endorsement requests could be a frustrating and time consuming process. Interstate is pleased to announce the expansion of our web services to include Online Endorsement Processing that will truly amaze you. This new capability allows agents to complete endorsement requests through our Broker Tools link on our web site. Our IT staff has developed a completely user friendly system that requests just enough information to create the endorsement and get it to the correct person to process.
Once an endorsement is started, the system does all the work. You enter the first few letters of an insured's name and the system automatically displays a matching list of accounts you have placed with us by insured name and policy number. This feature continues throughout the process by allowing you to quickly search and fill in your contact information. We realize many agents use their own systems and/or forms, and we do not want anyone to have to enter information twice. So as an added bonus we offer you a screen to upload your own endorsement forms directly to us.
If you are already set up for our online Broker Tools (Certificates, Applications, Loss Run requests, Safety/Loss Control information, etc.), the endorsements are already available to you. If not, please use the contacts below.
To get set up simply email me:
Kristine Hutzell
Of course, you can always give us a call for immediate assistance. 1-800-452-0297
Other set up contacts include:
Laura Eny
and Chris Daubert
And please do not hesitate to share your feedback - we listen!
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Success - according to Webster's dictionary success means "1). Favorable or desired outcome 2). attainment of wealth, favor or eminence..."
Fast track - also according to Webster's dictionary means "1). To speed up processing, production or construction of in order to meet a goal."
No this is not a grammar/spelling lesson but rather an insight into Interstate Insurance Management's philosophy. We understand that in this fast paced industry, new business must be reviewed and quoted in a timely manner. This in turn results in higher profitability for your agency.
To put a twist on an old saying
"The early agent catches the trucker."
Interstate promises its agents that 1 or 2 unit accounts, needed immediately, will be reviewed and quoted that same day, or at least within 24 hours.
One of the tools that Interstate has implemented to achieve this goal is the capability for agents to enter all quick quote information on our web site and submit with the "click of a button"!
Please keep in mind that all information required on the quick quote is essential in speeding up the quotation process.
Try it out at the top of this page!
Click Applications
Click Interstate Trucker/Commercial Auto Quick Quote
......And you are on your way to SUCCESS!
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Interstate has partnered with Beazley Insurance Company to provide you access to
PRIVATE ENTERPRISE/SMALL BUSINESS. This product offers either Professional
Liability or Management Liability for your clients. Beazley is an Admitted Carrier in
most states. They are A. M. Best rated A VIII.
Professional Liability is available for Technology classes and Miscellaneous Professional
classes. The Technology coverage can be provided for both technology products and
services. Broad professional liability coverage is integrated into the policy, addressing
the need to cover both technology and non-technology professional services. Third Party
Consumer and network liability security coverage for unauthorized access, identity theft,
theft of or destruction of data, denial of service attacks and virus transmission involving
the insured's computer systems can also be provided.
Miscellaneous Professional Liability insurance provides financial protection for errors
and omissions arising from services provided by a wide range of businesses. In addition
to coverage for financial loss arising from negligence in the insured's performance of
professional services, the Beazley policy offers the following key coverage features:
Coverage for contingent bodily injury and property damage offered subject to
underwriting; Coverage for unintended breach of contract; Vicarious liability coverage
for negligence of independent contractors in providing professional and technology
services; Defense of injunctive relief claims; and Defense of claims for fraud, dishonesty,
etc., with innocent insured coverage.
Technology classes generally considered include: Software Companies, System
Integrators, Technology Outsourcers, Technology Consulting, Internet Services and
Combined hardware/software and business services providers. Miscellaneous classes
generally considered include: Management Consultants, Staffing Agencies, Research
Organizations, Outsourcing Companies, Security Consultants, and Lawyers (30+ member
firms).
The applications are available on our website. Product sheets summarizing the coverage
available, target market, and limits are available for your marketing use. Contact your
Underwriter to request one. There is also a more detailed listing of classes generally
considered, as well as those not considered available. It's the perfect tool to help you
identify your market of choice for Professional Liability. Your Underwriter can also
provide this for you.
Keep an eye out for more information about the Management Liability coverage available
in a future issue of the Underwriter's Corner. In the meantime, feel free to discuss this
with your Underwriter.
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As one of the largest transportation general agents in the northeastern United States, Interstate Insurance Management, Inc. represents many of the most highly regarded transportation insurers in the industry. Because we have represented most of these insurers for many years and have cultivated close personal relationships with our company underwriters, we are in a position to identify the best possible combination of coverage and pricing for your transportation risks.
As the market continues to soften, it is imperative that you align yourself with a general agent that can effectively and efficiently search the market for the best home for your clients. As that general agent, Interstate will consider all available markets on your behalf. However, if your client insists on assigning specific markets to specific retail agents, we may be limited in our ability to do the best job for you. While market assignments are an inevitable part of the soft market cycle, we ask that you explain to your clients that you are at a disadvantage as a result of this decision. For example, if you receive Empire as a market assignment for a particular risk and a competing retail agent receives Northland, both of which are represented by Interstate, we will be able to quote only Empire for you even though Northland may be a better fit in this case. It will be even more frustrating for you if Northland ultimately writes the account.
Please understand that Interstate does not control whom the insured chooses to do business with at the retail level, nor do we want to be caught in the middle of this decision. Instead, we feel that our time is better spent doing what we do best - identifying the best price and coverage options for your client. Consequently, when we receive submissions from multiple retail agents representing the same client, we ask that you obtain a signed statement on the client's letterhead clearly identifying your agency as the broker of record and Interstate as the agent of record. We can then approach all of our available markets solely on behalf of your agency. If the insured still chooses to assign specific markets, please make every attempt to procure assignments for all of the transportation insurers on Interstate's extensive list (see below). We are here to help you through the soft market, and we will be here for you in the hard market!
Interstate's Transportation Markets (alphabetically): American Mining, Canal, Colony, Empire Fire & Marine, Lincoln General, Lloyds of London, Maxum, Northland, Rockwood.
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It is that time of year when many of us start to think about things to come and make new years resolutions. Make your resolution to have Interstate Insurance Management be your number one broker!
We have excellent relationships with many companies, both admitted and non-admitted, and we want to write your business for you. Whether it is a restaurant, habitational (including student housing), manufacturing, or a contractors risk, we can help.
We are also able to write BOP coverage on certain classes of business including day cares, beauty salons, restaurants and mercantile operations with premiums as low as $350. The greatest benefit of a BOP is the additional coverages, which are included at no additional charge. These include Business Income and extra expense coverage on an Actual Loss Sustained (ALS) basis, Pollutant Clean up and Removal, EDP Coverage, employee dishonesty, Limited Coverage for Fungus, Wet Rot, Dry Rot and Bacteria and many others.
We have developed great relationships with our companies and work closely with them in this ever-changing marketplace to provide the best possible coverage and pricing. Relationships are important and we want to provide you with the best possible customer service, quick turn around on quotes and a knowledgeable, friendly staff. Our number one priority is YOU and we want to help YOU write business.
As always, don't hesitate to contact us. Interstate is here for YOU!!
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We all face difficult times. As prices erode and competition increases it becomes more and more difficult to write new accounts. Under these conditions timing becomes nearly as important as price in landing a new piece of business. Being the first person to present a quote with a fair price can go a long way toward heading off your competition and getting that business on the books.
All of the companies that we use have certain underwriting requirements that must be met to confirm both pricing and eligibility prior to releasing a quote. That requires information and that is where we need your help..
The more information you can provide up front, fully completed applications, supplements where warranted, loss history, narrative descriptions, web site addresses and so on allow us to get you the best quote in the shortest amount of time. While it may not be possible to provide every thing we need every time, the more information we have the faster we can turn things around for you.
There is a section on our website, (click here), with submission requirements for a number of lines of insurance and classes of business. There is also an extensive library of supplemental applications provided.
We strive to provide you with the best service possible, but we do need your help.
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On a "new venture", since there is no prior loss history to verify the quality of the risk, it's important
for us to have prior employment history to verify the experience of the driver. First example: you
get a call from a seasoned trucker who has been a company employee his entire trucking career. He
now purchases a tractor and wants to go out on his own. This "new venture" is one that we would
like to take a look at. Has the driver always driven the same type of vehicle? Is he familiar with the
routes that he will travel? Find out where he worked for the past 3 years, what type of equipment he
operated, and the dates that he worked there. Getting this information is an important part of the
underwriting process that you, as brokers, need to obtain. We count on you! We have a driver
employment history form that will help you gather that data-just give us a call.
Second example: You get a call from a young man (or woman!) fresh out of truck driving school,
brand new CDL. He has decided that he wants to be an independent owner operator, hauling
produce from Miami. This "new venture" is one that would not be acceptable. Without "over the
road" experience, familiarity with the routes traveled and the equipment being operated, he (or she!)
doesn't qualify for our markets.
Our excellent markets can package all lines for you-liability, physical damage, cargo, and general
liability. Give us a call anytime!
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Few people would argue that price is unimportant when selling insurance policies. Unfortunately, we are all guilty at some time or another of acting as if it is the only thing of importance. Keep in mind that our customers are purchasing financial protection for their business operations, and look to us to provide not only a competitive price, but also proper protection for their business.
None of us live in the least expensive house in our hometown, nor drive the least expensive car that was available on the dealer's lot. Similarly, the least expensive insurance policy is often not the best deal - like a car or home purchase, many times you get exactly what you pay for. We are accustomed in our lifestyles to paying extra for added features and benefits for most purchases - why should insurance purchases be any different? An analysis of our claims book gives a multitude of examples of what was paid in a claim situation, and what could have been paid had the coverages and / or carrier been different. At the time of loss, the policy pricing suddenly means little to the insured - what now becomes of utmost importance are the policy coverages.
Not all policies are created equal. Compare not only the financial strength of the carriers, and their length of time as a commercial coverage writer, but also the policy forms to help determine what is actually the "best deal" for your customers. Look for coverages like the following:
LIABILITY:
- Is Broadened Pollution Coverage included or excluded?
- Is the Radius Limitation Endorsement strict in interpretation, "usual & customary", or is no radius limitation endorsement used at all?
- How are temporary substitute autos handled?
- Are there add-on coverages such as Family Emergency Travel Coverage, or Non-Trucking Coverage for leased owner / operators?
PHYSICAL DAMAGE:
- Does the policy offer Comprehensive or Specified Perils only?
- Is a Combined Deductible included or available?
- Does the carrier pay Towing Expenses after a covered loss? If so, are the towing expenses considered as part of the stated value, or are they offered in addition to the stated value limit?
- Is Financed Value (Gap) Coverage included or available?
CARGO:
- Is a Combined Deductible (w/ phys dam) included or available?
- Does the form include Pollution Coverage, and / or Debris Removal? If so, what limit applies?
- Does the form include Earned Freight Coverage? What limit if so?
- Is Refer Breakdown included? Does a separate, higher deductible apply to this coverage if so?
- Does the policy form contain a Coinsurance Clause?
These are just a few short examples of coverage differentials that exist among carriers and policy forms.
Take for instance an owner / operator who just totaled his rig in an accident. He is facing separate deductibles for the tractor physical damage, the trailer physical damage, and the cargo coverage. In addition, the vehicle is financed to 100% of value, has depreciated 15% since he drove it off the dealer's lot, but still has a near 100% loan balance since the first few months of his payments have gone primarily to interest charges. In addition, the towing company has just presented a $7,500 towing and recovery bill. Will the few hundred dollars premium savings at renewal matter now to this insured? More likely, what will be important is a policy form that includes combined deductibles, gap coverage, and towing paid outside of the stated limit. These coverages can mean $20,000 or so in addition claim payments to the insured in this example.
Price is important, but it should properly be only one factor in the decision process for an insurance purchase. Talk to our underwriters about policy forms and coverages - we will be glad to discuss what is included or available on our quote proposals, and what differences there may be among carriers. Most of all, talk to your insureds - there's no one other than us to deliver this message, and sound advice is what turns short-term purchasers into long-term clients for our agencies.
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