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Insurance claims

Discussion in 'Business Fundamentals' started by frostservices, Dec 23, 2005.

  1. frostservices

    frostservices Member
    Messages: 63

    I was just curious how many of you guys have had claims on your insurance and if anyone has ever had a real big claim? I am required to carry it by the company I plow for. I just wondered if any of you have had as much in claims as you have paid in.
  2. Mick

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

    I've never had a claim on my insurance, but maybe I'm looking at it differently than some might. I pay around $800 a year for $1 million. If I got a claim for $800, I'd pay it out of pocket to keep the claim off my record. I want to keep the insurance in the case of the big claim, major property damage and/or medical expenses running into at least the thousands of dollars. The reason is that if you have a claim (and in some cases it only takes one regardless of the amount) your premiums will skyrocket, your insurance company may cancel the policy on the spot after paying the claim or may decline to renew at the end of the policy. If they cancel or decline to renew, this will go on your record of insurance. Any company contemplating issuing you insurance will look up your record of claims. With a cancellation or non-renewal on your record, they will decline to issue you a policy, too. Essentially, you're out of business - and not just snowplowing business. I've discussed all this with my agent and have decided if I have a claim, it will be a big one and I will just plan on going out of business.
  3. frostservices

    frostservices Member
    Messages: 63

    Hey Mick,
    I guess I can see your point as far as paying out of pocket for small claims ,and I would do the same thing so I guess basically we have to carry enough insurance that if we cut the gas line and blow up all the houses on the block were covered.I guess I can see it for us with alot of commercial accounts but.I plowed a fiber optic substation for one of the big long distance carriers ,and the tech told me if their cable is cut it was something like $100,000 a minute in lost revenue I think they required 10 million liability to work on their site. I just think if I was just doing residential I would forget the liability and just pay any claims out of pocket. I just cant imagine what you could do at a residential that would be over a couple thousand dollars ,but open my eyes guys I must be overlooking something.
    I can see it for excavators and landscapers but it seems like a pretty low liability for plowing snow. I would just set up an account and put in as much as I would be paying for insurance and then if I had a claim I could just use that to cover it ,gaining interest on the money till you retire. Like I said I am not thing of dropping my insurance I just think its overkill for someone that plows a few houses. ok flame away boys.:)
  4. NEAL

    NEAL Member
    Messages: 98

    It's the slip and falls that will get you. When the person falls down on the driveway you plow and sues you for a million dollars you will be very glad you were paying that insurance premium. Also wouldn't take much to cause a lot of $$ of property damage. You just never know what is going to happen. Liability is one reason I stopped plowing snow this year. I am stepping back and making sure the little bit of money I make is worth the liability risk. My main income is from lawn maintenence and I would hate to be denied GL insurance for that because of a claim with snow.
  5. frostservices

    frostservices Member
    Messages: 63

    I guess some of the guys were saying your only responsible for slip and falls if you offer salting, you could sure have a disclaimer on the contract.
  6. John from OH

    John from OH Member
    Messages: 35

    "I guess some of the guys were saying your only responsible for slip and falls if you offer salting, you could sure have a disclaimer on the contract."

    A disclaimer in your contract will not keep you out of any litigation. It might limit your liability, then again, iit might get torn apart by the plaintiffs attorney. This is where your insurance will pay off. They will defend you in such cases. Without insurance, you might by totally clear of liability, but still owe huge amounts in legal fees defending yourself.

    In the residential market, I feel the biggest risk is not property damage or slip and fall liability. I feel it is the possibility of hitting a child playing in the snow. There are always kids playing on snow piles, sledding down drives and lawns, and just being kids. If you are doing your job plowing, fatigue sets in, and one of these kids runs/ sleds/ snowboards behind your truck, you may/ may not see them and may/ may not get stopped in time. Its best to protect yourself and have the peace of mind. Its not the any of us want to have an accident, somethings are beyond our control.
  7. golden arches

    golden arches Senior Member
    Messages: 193

    A disclaimer that is part of a signed contract carries limited weight. Our disclaimer places the burden on the account, both in claim and defense. Basically says that we are responsible only while spreading the deicer.

    Our lawyer has the disclaimer in the main body of the contract (not hidden in small print on the back). Fortunately we've never had to test the value or legitimacy of doing it this way.
  8. drplow

    drplow Senior Member
    Messages: 174

    if some one falls, and in any way you did something wrong, your done. and if you did it by the book then, your done.
    disclaimer, disshamer. you might limit your self with a bunch of blah blah in your contract, but if someone gets hurt then it opens up a case where they could sue you some way. they will find a way. if you have a lot of assets, then get a rider or umbrella policy. or just put them in someone else's name, like your leasing them. you never know whats going to happen, so be prepared. i alway think of it as, "its not mine the bank owns it all, so screw you."
  9. golden arches

    golden arches Senior Member
    Messages: 193

    The disclaimer establishes who takes responsiblity in case of damages. If you did something wrong, then no disclaimer is going to protect you. But if you followed normal established practices as covered by your contract, you have some protection.

    Most courts and attorneys search out the "deep pockets" and seek damages from the individual with the most funds.

    I had a friend in upstate NY that hired a sub-contractor to do windows at a commerical building they cleaned. The window washes ladder wasn't secured properly and he fell 1 story, about 12 feet. He refused medical treatment.

    A couple of weeks later they received a notice from a lawyer that they were being sued by the window washer for injuries. The claim was the contractor that hired him (my friend) failed to assure the window washer was properly trained in use of the equipment that HE brought to the job, ie; the ladder.

    My friend had $1 million in insurance.. the claim was for $5 million.

    Long story short - the contractor had a disclaimer his contract that the building owner would defend the contractor from all claims resulting from injuries to others while cleaning the building.

    After 5 long years, they settled out of court for 3 million. The building owners liablity insurance paid 90%, while my friends insurance paid 10%. And after all of this, he maintained the account.

    Yes, you can be sued for just about anything.