role of insurance sector

role of insurance sector
We have built on the side after the curve of commercial insurance for the past year and a half. In 2006, profits were at all-time high for the insurance industry. These gains sparked a flood of capital into the insurance market. In addition, many new insurance companies sprouted and put into operation, so that competition and security of supply must be increased. As we all learned in the know, if demand stays the same, but supply increases, prices fall. The prognosis for the near future is a continuation of the decline in pricing for the Insurance, Real Estate, Auto, and Workers Compensation. Over the past year and a half alone, restaurants have the insurance to fall by 15-40%.

Is there an end in sight? It is once the carriers begin paying more in claims and operating costs than what they are doing in premium dollars. A hardening of the market is cyclical, when insurance companies start to see red in their bottom line. Hurricane season to damage the large property losses or disasters such as 9 / 11 may be in the process. Further litigation or particularly large claims in relation to workers compensation, food disorders, or liquor liability can also result in an increase in prices for the restaurant industry. Moreover, there is always the next "claim du jour", "that we have not thought yet. For example, prices could be class actions suits related to facts, privacy or other suits cased credit card, by using information on sales receipts.

Only one thing is sure: The "hard" market is back. Regardless of whether the market rises or falls, which is on risk management, reduction, and paying attention to details can help you recover the costs in any market situation. Given the current state of the economy, cutting substantial costs now, you can create a few jobs down the line. Remember that sometimes the best defense is a good offensive.

Consider these tips to help enhance the status of your insurance:

Location, location, location. Every successful restaurant entrepreneur must be able to effectively analyze situations and identify opportunities. Consider the way you have your concept as an organization to potential savings. Some customers my company works with its leasing operations and also lease their employees from a PEO. Property and Worker's Compensation Insurance are included in these costs. This has the effect of the restaurants use this strategy to a greater degree of control and significant savings through the carving and the coverage of negotiation there.

Manage your expectations. America is the land of the frivolous action, if so, the restaurant is undoubtedly the epicenter. Is there anything more frustrating than dealing with a complaint and the unsuspecting to the circumstances of the claim? Of course, the lawsuit is usually enough to some e-mail attorney, has a really "clever" to say how, "" We take names, then kick butt! ""

Prompt to execute requests and tracking incidents are integral elements of the claims management. They will also reduce claims costs. Set correctly, these processes and procedures to protect your organization against possible surprises and minimize claims issues. Without doing so, you can be a goal. Also special instructions for treatment that claims to dictate what is claimed. In this way you can to avoid disruption of ongoing operations in the event that a great loss.

Choose the right partner. The commercial insurance industry can be a confusing and misunderstood, and unfortunately there are a lot of incompetence in circulation. Worse still, the brokerage commissions in the commercial insurance are usually set so that you essentially the same price for a filet mignon, as it's for a burger! But my experience in the industry has taught me that lawyers, restaurant manager, owner and does not have the time to really understand how insurance companies really work.

What you need to do is to speak with a insurance broker, the industry expertise, knows the market and has a record for consistent success. Do your due diligence and talk to references and restaurants in the brokerage services personally. Note that you can hear something like, "" We take care Brinker, "" but the actual team do the work in another office. Also, remember that your broker will not necessarily be local. They do, though, must be in the industry are aware of industry-specific issues to be creative and have some leverage to negotiate the best deal for you. The choice of a large broker can increase the bottom line of $ 25.000 + per location, contribute to solutions in an organization, improvement and a review of the micro and macro level.

Finally, when it comes to choosing the right broker, make sure that he or she is a good team. Nobody can effectively all your commercial insurance. Select your team, great service, handles claims and loss control, and alternative risk expertise.

Do you have a strategy for renewal. Do not get yourself caught in the insurance cycle. If you cycle, it can not function. How can we effectively work cycle?

• In soft markets, may be forced to cancel a current policy to use lower prices. This is, of course, will depend on how much you already paid premiums.

• You can also charge more money by reducing the premium mid-term, so that you, a significant escrow service instead of U.S. dollars currently. You can also sting and the length of the next hard market by extending the current conditions in the soft market.

• Always pay attention to what time of year, your current policy is for the renewal. Through the negotiation of rates at the end of a quarter, with insurance companies, the premiums are to their number, you can negotiate better terms.

• For coastal properties, make sure to renew before the hype of a new hurricane season rolls in.

As a general rule, early to renew. They do not want to be held hostage by last-minute offers. We all know the extension in terms unappetizing options on the day before the renewal. They want to be able to have the job early enough to be reviewed. Make sure that your broker allows this to happen. In this way, if the conditions are not to your liking, you have the luxury to stay at another place.

The tips above should provide an insight into what otherwise be confusing and frustrating endeavor. With this said, that there is always considerable savings in every aspect of any restaurant concept in the country. Risk management and insurance may not only be the first place, most people are happy.

Ryan Morgan is a Vice President in the Dallas office of McGriff, Seibels & Williams. McGriff is the eighth largest insurance companies in the U.S. with headquarters in Birmingham, Ala., the company operates 11 branches across the nation, including the Dallas office, which focuses on restaurant and real estate business.

Morgan Ryan, ARM

Commercial Insurance

Article written by Ryan Morgan