Post a new topic
    3 Replies Latest reply on Oct 11, 2007 4:27 PM by InsuranceGuy

    commercial insurance & workers comp.

    abcgeneral Newbie
      Why is it so difficult for small businesses (especially construction) to purchase workers compensation and liability insurance?
        • Re: commercial insurance & workers comp.
          ORIGINATOR Wayfarer

          Some of the reasons that may make it difficult for small businesses to purchase workers compensation and liability insurance could be

          1.That there is no prior history of the business being insured.

          2. There is incomplete information in the application for the underwriter to fully understand the risk. (When this usually happens they simply decline to quote the risk)

          What states does the business operate in and what type of business is it?
          • Re: commercial insurance & workers comp.
            GasisaRipoff Newbie
            There are many reasons, but the main one is that small companies throw off what in insurance is called the law of large numbers. As you are a small company, there are not very many positions to spread the risk in your company.

            There are many ways to become insured if you search out all the possibilities. You should have an agent that specializes in small companies. Most small companies are not big enough to be rateable. There is usually some threshold where NCCI or your state rating bureau considers you large enough to rate your company.

            There are tons of ways to become insured on the web. Try out Google and type in workers compensation for small businesses. PEO's are great, but have been operating under a cloud of suspicion lately. Be very careful of "Ghost Policies". They are legal in some states, but not in others.


            James J Moore, AIC, MBA, ChFC, ARM


            J&L Risk Mgmt Consultants, Inc.


            (800) 813-1386 Direct Line


            (877) 4-COMP-HELP Ext 701






            Cutting Employers' WC Costs for 11+ Years

            • Re: commercial insurance & workers comp.
              InsuranceGuy Newbie
              Being an agent in the State of Ohio where the state is the only market for workers comp, I can not answer the workers comp question any better that the previous posts.

              From a general liability standpoint, if you have past experience in a managerial position with a contracting firm, have a business plan, and have a resume in order highlighting your experience, you should be able to find coverage.

              I do note where you describe yourself as a general contractor. Do you have employees or are you subcontracting the majority of your jobs? If you subcontract a high percentage of your work, you most likely would have difficulty initially getting general liability, as a general contractor brings risks that many insurance companies do not have an appetite for. General contractors subbing out the majority of work do not have absolute control over the jobsite and workmanship as a contractor using employees.

              If you have a well written subcontractors agreement that includes a hold harmless clause, risk transfer clause, waiver of subrogation clause, requires liability insurance, and you are diligent in hiring only insured subs that sign the contract and provide proof of insurance and provide you additional insured status on thier insurance policy, your task will be much easier.

              You might want to contact a "Trusted Choice" Agency ( in your area for help. "Trusted Choice" Agents represent numerous companies and markets and can customize a policy for your individual needs.

              Tim Miller