It is no secret that inflation is ever present, and the cost of just about everything continues to rise. Whether it’s food, fuel, housing, etc. we’re all experiencing inflation in our daily lives. While the majority of us are happy to identify ways to save on our expenses, occasionally there are instances whereby certain products and/or services justify a greater expense in favor of superior quality and/or benefit.
When it comes to securing commercial auto and general liability insurance for your business, it’s best not to proceed with the “cheapest rate automatically wins” mentality. Insurance is designed to protect you and your company against potential financial hardship. If your “cheapest rate” insurance policy is just that, CHEAP, there’s a significant chance there is a reason it’s “cheap” and the level of protection it provides could be compromised.
While price is generally the primary focus for individuals & companies purchasing insurance (let’s face it, it comes right off your bottom line), it’s the specific and pertinent policy language they do not see or focus on, that can put their business in jeopardy in the event of a claim. Right now, you should be asking yourself, what are those pertinent details I’m not seeing? Is cheaper better? The answer is simple, policy exclusions, limitations on coverage, and more.
If a consumer is searching solely for the cheapest price, it often goes unnoticed that the coverage is cheap for a reason. In general, the cheaper coverage provides more restrictive coverage by placing limitations on how coverage will or will not be provided in the event of a claim. Below are two brief lists of just a few limitations/restrictions these cheaper policies may include which could leave your company unprotected.
Automobile Liability:
- Scheduled Automobile (symbol 7) – if a specific vehicle is not listed on the policy, zero coverage is provided
- Unreported Driver Exclusion – if a specific driver is not listed on the policy, coverage may not apply
- Loading & Unloading Exclusion – No coverage for incidents occurring while exiting or entering the vehicle (especially dangerous for wheelchair bound passengers)
General Liability:
- Designated Premises – coverage only applies to the designated location (office location). Not in the field
- Loading & Unloading Exclusion – No coverage for incidents occurring while exiting or entering the vehicles (especially dangerous for wheelchair bound passengers)
- Sexual Abuse & Molestation Exclusion – No coverage provided for any accusations (not compliant with most Transportation Broker contracts)
- Sub-limits – provides a lower coverage limit for certain covered claims that may not be entirely excluded
Please understand that the above list is merely a small fraction of items to be conscious of when evaluating your commercial insurance options. We encourage you to ask your agent whether the quotes they are providing to you include any of the above, and/or any additional exclusions/limitations within the policy language. Upfront savings may at first appear like a win, but can quickly turn into a loss in the event of an uncovered claim. Cheaper doesn’t equal better.