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Cost of Insurance going up

Discussion in 'Commercial Snow Removal' started by wyldman, Mar 4, 2003.

  1. wyldman

    wyldman Member
    Messages: 3,265

    I was at a small get together last night with a few local snow contractors,and we were discussing the fact that most of our insurance has been going up 20-40% this year.We have also had a lot of insurance audits,which are targeting the guys who are claiming very low gross incomes to keep premiums down.

    What really suprised me is one of the largest contractors,who is huge,is actually dumping ALL of his snowplowing operations due to insurance costs.He was paying $30K a few years ago,and his insurance has gone up bit by bit,first to $80K,then $120K and his renewal is suppose to be over $180K.Yes that's $180,000 dollars.

    I sure hope we don't ever get nailed like that,I'd be looking to shut it all down also.I was just curious if anyone else with very large operations are getting hit with such large increases as well,and does your operation have the ability to afford such high premiums ? Will your market area tolerate the the neccesary cost increases due to the insurance costs ?
     
  2. John DiMartino

    John DiMartino PlowSite.com Veteran
    Messages: 2,154

    If all insurance is going up,prices will have to go up accordingly.The lots will still have to be cleared,I would think you may be seeing more uninsured contractors and cash guys working.Businesse will still want to see a contractors liability policy,I would think to cover themselves.For what its worth my insurance doubled in the last 2 yrs,and im a small operation IMO,mostly snow.
     
  3. A.L. Inc.

    A.L. Inc. Member
    Messages: 97

    Chris- I am a small snow operation, but have a medium sized landscape operation. I can tell you these increases are happening in almost all industries. We just got a 20% increase on both auto and business liability(which includes snow removal). I will just have to adapt. I met with my insurance agent and he flat out said to me "You'll just have to find more profitable work", meaning less lawn mowing and more landscape construction.
    I agree with John, there will probably be more uninsured plow operators, at least on residential, but commercial properties will still need insured plow operations. The market will have no choice but to tolerate the cost increases, they will still need to have their snow removed.
     
  4. wyldman

    wyldman Member
    Messages: 3,265

    It's going to put a lot of guys in a tough situation.The profit margins here on snow related stuff,aren't as great as in some other areas,and some guys just don't make enough to cover the additional costs.

    Were going to see a big increase in smaller uninsured guys,or lowballers,for sure.I just hope the market in general will tolerate the large price increses we are going to have to start passing on if we wish to continue in this type of business.Most companies right now are balking at any price increases.They already feel we are overcharging.Hopefully there will not be enough lowballers out there to cover all these business who figure they can get it done cheaper elsewhere.

    I'm with you on the insurance increases across the board.My personal auto,house,and just about everything vent WAY up this year.It hurts.
     
  5. JCurtis

    JCurtis Banned
    Messages: 862

    I think its high time that the Attornies General

    of every state start looking into the ripoff they call insurance. There has to be collusion in that industry if there is such a thing as collusion. Insurance is just a legalized rip off IMO, I mean I fully understand the need for coverage, but from what I have heard these insurance companies have SOOOOOOOOO MUCH money squirreled away, they cant possibly be losing money paying off even the largest claim.

    The insurance companies are using every excuse in the book to raise rates. yet file a claim and they nickel and dime you to death.

    I really think that our society has become way tooooooooooo litigious and everyone is ready to sue at the drop of a pin.

    Maybe Im just spittin into the wind here, but if something isnt done soon by the legal system and the government, we wont be able to afford to stay in business.

    Any contractors out there plow any insurance company lots?

    Double your rates to them and see what happens!!!! You'll lose the account. maybe we need to revolt and stop paying insurance premiums once and for all.

    What about State Farm.... they have the cohones to send letters out to all their insured stating that in the case of Nuclear Attack, your car won't be covered for repairs or replacement, and they reiterated that your house isnt covered either.

    Seems top me that if a Nuke goes off in my area or anyones hometown, we are going to have a few more far serious concerns to ponder, moreso than who is gonna fix our cars damage.

    Besides does anyone wanna drive a vehicle that glows in the dark?:realmad: :realmad: :realmad:
     
    Last edited: Mar 4, 2003
  6. cat320

    cat320 2000 Club Member
    Messages: 2,223

    You work to pay for insurance ,taxes,gas ,truck repair and then you get to make money :(
     
  7. Mick

    Mick PlowSite.com Veteran
    from Maine
    Messages: 5,546

    JCurtis, that's real interesting about State Farm. I just got letters from two different insurance companies I'm covered with stating that my houses and vehicles are covered in case of damage from terrorist attack.
     
  8. JCurtis

    JCurtis Banned
    Messages: 862

    Mick,

    what companies are those....

    you maybe covered for terrorist attack, but maybe not Nuclear attacks...

    Maybe someone who detonates a nuke isn't a terrorist:confused:

    Ol' GW wouldn't like that, he would have to stop calling people terrorists:nono:
     
  9. Mick

    Mick PlowSite.com Veteran
    from Maine
    Messages: 5,546

    Progressive was one - which is for the vehicles. I think the second notice I got was from Vermont Mutual. I have two different companies for the residences and just can't remember where the second notice was from:( . That's what happens when you let the escrow take care of paying the insurance. You forget who it's being paid to and I'm too lazy to go look for the policy right now.
     
  10. CMerLand

    CMerLand Senior Member
    Messages: 173

    Im meeting with my agent on Thursday, and have already been told to expect rates to go up. However, one of the things he told me that Im really irked at is that CNA will not renew my workers comp insurance no matter what. I asked him, why the hell not??? And he stated that he was looking over our claim history and it must be something in there.

    I told him that was bunk, well it started with a b., that we have never had a major injury claim ever or any lost time accidents in 12 years. Every year we have one or two of the stupid claims caused by stupid employees doing very stupid things.

    For example, last year we had an employee who decided instead of using the pruning shears to cut weedeater string, instead he'd use a walker mower blade to chop it. Yep, he chopped his thumb in half like a jackass. We also have had over the past couple of years the minor hedge trimmer cuts on the arm or leg, or the dirt or something in the eye thing. (We provide safety glasses and replace them frequently)

    I see these bills come from the hospital, and have asked my agent straight out several times, "Should I just pay this out of pocket, $300 to $ 500 bucks, or submit it to the insurance company? He tells me, " WELLL, you can pay it out of pocket, but then if there is a problem later on your on the hook later on. For example, if a guy gets whacked in the eye and then 6 months later when hes working for someone else and starts having vision trouble, Im on my own because I paid the original claim and responsible for all the medical costs forever on that. So needless to say we submit the claim.

    I just checked my policy, and will pay over 4 grand for workers comp insurance after the audit is completed. And they are going to drop me!!!!!! This is total crap. Why am I paying for WC insurance if they are going to bill me for 4 grand a year and then drop me because they have to pay out mayyyybeeee $ 1000.00 a year in minor claims???? And I think we are quite safety consious and always looking for ways to make what we do safer. However, there is no cure for stupidity and the type of work we do is not paper shuffling like at CNA.

    Im reallllll irked over this and cant wait to find out where the new numbers are coming in at. Stay tuned Ill report back.
     
  11. gene gls

    gene gls PlowSite.com Veteran
    Messages: 481

    Mick:

    You need to check your insurance policy. If you " are " covered for terriorest insurance, then some one has added that premium to your coverage. I have been notified by all my insurance providers that it is an opitional coverage being offered. I don't live in a high risk area for an attack so I will take my chances.

    CMerLand:

    I'm in the same boat as you, stupid accidents. I have been told that all small companys go into an insurance pool and the insurance companys have to pick names and offer coverage for workers comp because it is mandated by the state. Mine doubled last year.

    Gene
     
  12. chtucker

    chtucker Senior Member
    Messages: 618

    Just so you see what I go through (not all snow related....)

    10k a year in property/liquor liability
    2.4k yr for commercial auto (snowplowing)
    3k in workers comp (brewery)
    12k in health insurance (wife and me and employeed matching)
    1k a year in homeowners
    .9k in regular auto
    total almost $30,000 a year

    Did I mention that I have had ZERO claims!

    Across the board our insurances went of 15-25% this last renewals
     
  13. 66Construction

    66Construction Senior Member
    Messages: 315

    Insurance companies have a lisence to steal and that's the bottom line untill something changes...probably NEVER!



    Cmerland.... I hear you on the WC I have 12 guys and pay 14-15 on the 100 8 full time and 4 part time. it adds up quick about 20k this year. i've only had 1 claim in 3 years.

    I'd like to get a peek at John Allins insurance bill...it'll probably make us all feel better!

    Casey


    BTW for the taxes I paid this year GW one of those bombs better say 66Construction on the side of it!!
     
  14. tnemrod

    tnemrod Junior Member
    from MD/IA
    Messages: 2

    Insurance

    Ive been reading this site for a few weeks now and think its GREAT, Ive learned alot. However, this is my first post...

    I think the Insurance Industry is a racquet also! Although Im still in college and it doesnt impact me to the same degree as many of you, it still p***** me off.

    Here is a little info I've been told about the current trend with the insurance industry and their increase across the board with rates.
    (Im not in the insurance industry, so if this isn't accurate feel free to set me straight.)

    Insurance companies take our rates and bank the money for the liability their exposed to.... Blah, Blah, Blah... But to increase profit margins they take a percentage of the premium and invest it in the Market. Through the booming bear market of the 90's this made it a very profitable choice. Then came Setp. 11th, and the market went south. We all know the current trend the market is in.

    Hence, the hard earned money we've all been paying to protect our back sides has "mostly" evaporated in the market.

    So guess what.... Now our rates are going up on renewal to compensate for the decreased earnings from their investments. In an attempt to keep the profitablity their B.O.D./investors are use to. (They just assume we forget about all the money they made during the market boom.)

    Hmmm, what can you say....

    One other point to consider on the subject of "Terrorism and Nuclear Attack". Sounds like some of you are covered under a Terrorist Act or Attack but not a nuclear. (And I agree, if we have a Nuclear Attack we all have bigger issues at hand.)
    But- what about a Terrorist Attack with a "Dirty Bomb"? A conventinal bomb with low grade nuclear waste strapped to it. It doesnt have the "Bang" but still gives the scare and fall out on a small scale.
    This is a very real threat! Now I understand it may sound silly, there are a 100 different what if's... But this might be a consideration for some of you.

    Anyway, sorry to be long winded, but I agree with all of you. Now Ill keep my trap shut and learn from you guys. -TN :waving:
     
  15. MLB

    MLB Senior Member
    Messages: 110

    Re: I think its high time that the Attornies General

    What about State Farm.... they have the cohones to send letters out to all their insured stating that in the case of Nuclear Attack, your car won't be covered for repairs or replacement, and they reiterated that your house isnt covered either.

    Same letters from Erie - got 12 of them for all my policies (2 businesses).
     
  16. dillyolboy

    dillyolboy Member
    Messages: 97

    That is one thing I can't understand. How can your rates drastically rise if you don't make any claims :confused: I think insurance is rip off. I pay $600 every 6 months for PLPD car insurance 0 claims or accidents. What other business can you make $100 a month by handing out a piece of paper and have people be required to do it? Now lots of doctors are moving cause they can't afford liability insurance for their practices. The stock market investment story makes sense but it sounds unethical. Yes something definitely needs to be done. What does it take to become an insurance company? Could contractors start their own nonprofit insurance deal? The terrorist attack coverage is ridiculous. How many people drive their plow trucks in a high risk area? I know none of the places I plow would be a remotely logical target.