Outgrowing Your Current Agent

Industry: Light Manufacturing Exposure: $12 million

Coverage Benefit: Over $1 million in Additional Coverage

Savings: $40,000

Insurance Problem

In the past 10 years, this manufacturer had gone from a fledgling to a flourishing manufacturing company with 65 employees and $12 million in revenue.  The management of the company was happy with their current agent, whom they had been with since inception. The service had been good but they did feel that they were outgrowing his capabilities and saw the value in having an expert assess their current insurance program.

After reviewing the manufacturer’s policies, we discovered they had gaps in their coverage and were significantly underinsured.  The company’s insurance program showed they had property insurance of $1,050,000 but their warehouse contained $2,500,000 in inventory.  Even though the current agent had spoken to the management team every year at renewal, he never asked how the company was growing.  The manufacturer also had several employees misclassified in their Workers Compensation program which caused an audit concern, and they did not have coverage for Crime or Employment Practices, which is standard for companies of their size.  The manufacturer’s finance department felt like they were dealing with insurance all year because they had multiple carriers spread across multiple expiration dates.

Risk Management Solution

Through our work with the carriers, we were able to correct the manufacturer’s property limits.  The company also added a new Crime policy.  Even companies with tight financial controls can suffer a crime loss if multiple people have the ability to make payments and manage vendors.  Companies that have multiple layers of management and high employee turnover need employment practices liability coverage.  The owners wanted to protect themselves from actions of their employees and the seasonal employees fabricating false claims when their time with the manufacturer ended.  We also consolidated all policies to one carrier on one expiration date to decrease the amount of time needed every year to renew the insurance.

Results

Swingle Collins & Associates was not only able to increase coverages and limits but also to reduce their overall insurance costs from $140,000 to $100,000.  The management team was extremely happy that their risk management needs were being taken care of and that their company was properly insured for what they said was, “the first time in probably 5 years.”