There’s good news for businesses considering workplace liability insurance. The market place is in a soft cycle, meaning it’s a buyer’s market, insurance professionals say. They also emphasize the importance of all businesses, whatever their size, having this type of coverage.
“This market cycle is good for businesses,” says Bill Laws of Columbus, owner of the Bridge Group and a certified insurance counselor. “Because of the soft market, we have more companies that will look at those risks and the premiums will be less. An insurance company may come in and offer to cut a business’ premium in half.”
Laws, who’s been an agent for 17 years, now has more carriers he can consider for clients. He says that makes his life and that of other agents better.
“When it’s like this, we’re giving our insureds more of what they want,” he says. “There’s easier placement and more competition. I tend to like a soft market more.”
Foster Welburn, director of the self-insured program for the Mississippi Manufacturers Association (MMA), also likes the soft insurance market. “We’re seeing more and more competition in Mississippi,” he says. “The last time we saw it like this was in 1996.”
Welburn, who worked in the insurance industry many years before joining MMA, advises all businesses to have workplace liability coverage.
“While it’s a rare occurrence that it’s used, it’s a very real risk and is something every business should have,” he says. “If I had a small business, I would look to some of the smaller carriers who want to write this type of coverage. It’s a good time to do that. The pricing used to be expensive but it’s more affordable now.”
Scott Woods, executive vice president and insurance services manager for Trustmark National Bank, points out that a good risk management approach includes not only buying insurance to meet contingencies, but also proper operational policies and procedures with regular, routine review of potential opportunities for loss.
“When actual losses occur, businesses need to analyze what happened, why it happened and what could have been done to prevent it from happening for the current situation and for future situations,” he says.
The bank’s and other businesses’ needs in today’s environment are constantly changing. “Evolving legislation and case law as well as technological change require constant evaluation of coverage in place versus coverage needs,” Woods says. “The scope of increasing coverage exclusions in insurance policies continues to create changing needs for the bank’s insurance.”
Welburn says MMA supplies $2 million employer liability coverage to each member through the self-insured program. Members are insured up to $750 million per occurrence. Welburn explains that this amount is not per claim but for an occurrence such as a tornado destroying a workplace.
“We’re meeting members’ needs with this coverage and we’re always looking at ways to improve things for our members,” he adds.
Laws won’t venture a guess as to how long the current soft market will last. “Mother Nature may harden it. There are a lot of factors pertaining to that,” he says.
He too advises businesses of all sizes to have liability coverage, noting that the exposure to risk is there. “We offer it to everyone. They can deny it but we recommend it for those businesses with five or more employees,” he says.
Employers now have the option of different types of coverage. A fairly new type is directors’ and officers’ liability.
“We didn’t have that a few years ago. It’s more corporate insurance,” Laws says. “People can sue officers and directors of a company. That’s a big deal. It’s a newer risk and a growing type of liability. What happened at WorldCom comes to mind.”
Employment liability is another new type of coverage Laws is starting to see. “If I’m an employer and I fire you because of age discrimination, sexual harassment or wrongful termination, I will want to have this coverage,” he says. “We’re seeing more of that now.”
Contact MBJ contributing writer Lynn Lofton at email@example.com.