By Allison McGreal, Assistant Vice President
Aside from adding more to your company’s bottom line, there are several benefits to placing all lines of insurance with one carrier, when possible. There are advantages to both the insured and the carrier, including:
- Possible premium savings
- Claims handled by a single carrier, resulting in streamlined service
- May be able to waive a deductible if multiple coverage parts involved in a claim
- Leverage with carrier
- Difficult to move account
A balancing act
When an underwriter is looking at the entirety of an account, it may make sense to credit one line a little more, enabling the company to write all lines, which may give the insured some premium savings. If one line is under performing, the carrier may be able to offer a more streamlined premium on a claim-free line to offset and debits for the poor performing line. By picking up the clean line of coverage, the carrier has more premium by which to pay the claims for the non-performing line. This helps to keep the account overall loss ratio at a manageable level.
Simplifying the claims process
In the event of a claim, the loss may involve more than one line of coverage and having one claims department looking at the entire incident may be helpful. For example, if there’s an explosion at a jobsite causing Bodily Injury to a 3rd party, or Property Damage at a jobsite with injuries to the insured’s employees, the claim involves multiple lines of coverage. Adjusters within the same company will have access to the same information, may readily discuss the loss with each other, and will have a similar philosophy on how to proceed with regard to payments.
Dealing with deductibles
Although the deductible applies to each coverage part within a policy (i.e. one deductible for GL, another for Professional Liability), the carrier may only charge one deductible in the event that a claim involves multiple lines. When collecting the deductible, the higher deductible may apply, but if the GL is with one carrier and PL with another, each carrier would expect to collect the deductible.
Building a rapport
Binding multiple policies with one carrier also gives the insured some leverage with a carrier. Again, if one policy is underperforming, the carrier may be less likely to non-renew and more willing to work with the client to retain the entire account. While terms may change, at least the carrier might offer a viable option. Also, when an account has multiple policies, the carrier has more exposure and may be willing to provide additional services such as risk engineering, tools to assist with contract wording, health & safety, claim scenarios, and other areas that would help with overall loss control.
Knowing your options
Finally, not all insurance carriers offer all lines of coverage. Many will consider the package CGL/CPL/PL or Excess, but do not offer Auto or Workers Compensation options. Finding a carrier willing to provide all lines makes it more difficult for another broker to move the account from your office. It may also give you, as a broker, an advantage to move other accounts to your office.
A recent situation that occurred for PartnerOne Environmental involved a larger multi-line account that had some significant losses. We wrote the account and considered non-renewing the GL/Contractors Pollution/Professional and Workers Compensation policies, but because it was such a large multi-line risk, we worked with the agent and carrier to consider setting up risk engineering to enable us to have more control over the safety protocols, we increased the rate and deductibles, and provided renewal terms rather than sending non-renewal for claims.
So while splitting an account across multiple carriers may seem like the best option in some cases, there are some solid reasons to place as many lines as possible with one carrier when possible. For more information about the coverages PartnerOne offers, visit our products webpage or contact us.