It is now time to set the table for a successful 2012 in terms of budgets, forecasts, insurance renewal applications, and establishing 2012 benchmarks. In terms of insurance renewal, I am just curious as to what others are seeing in terms of property coverage rates due to all of the natural disasters and if anyone is seeing any other meaningful trends in terms of D&O, E&O and other major lines of insurance.
Also in terms of what we like to call enterprise
I am re-quoting right now and we got a slight rate bump. About 5% up for the same coverage on property. But that translates to a small amount b/c property is a tiny part of our coverage. Our general liability coverage went up almost lockstep with our estimated revenue growth, which i think is how they typically gauge your risk. Other than that revenue growth our core coverages stayed the same. We're not in a "disaster" zone in the U.S. (we're in norcal and no earthquakes for a while here - knock on wood) so we don't get the add-ons you might see in other regions.
We also got a slight bump on D&O and E&O - about 7%. We were already with a cheap carrier so this was still very competitive relative to other options so we stayed with the broker and carrier this year.
As for how to improve risk management, we always review our policies and procedures and work with our auditors at year-end to make sure we're in compliance both internally and with regs. It takes time but I make sure to schedule it. We typically aim for November b/c that's a slightly slower time for our firm and they can fit this kind of work in prior to the financial audits after year end.
Also, I always multiple-bid our insurance coverages. If I can find cheaper I don't always go with the low price, I will sometimes pay the same total but get more coverage if i'm feeling exposed. Something to consider.
I thoroughly agree with Jeff. Simply re-quoting is great and will lead to good outcomes for you. Take the time to do it. I would add that I always ask our auditors to share with us their best practices with other clients in any of our major processes. By doing that we are getting "free" high quality consulting. Okay, we're paying them to do an audit, but the best practices do come along for free. I ask for very specific insights such as, "Do you have any 'best practice' corporate signature processes we could compare ourselves to?" Every year I ask for a few of these and charge my managers with comparing our P&Ps to others'. The exercise is very good and we always come up with better ways to do things. And this has decreased our operating risk over time as we tighten up our processes across the company.
