i work for whats called a Managing General Agency (MGA). we act as a broker for the retail agents, finding the right company for their clients. all we are is a middle man. but we do have the same underwriting authority as the company, so 90% of the time we make decisions based on the outline the company gives us.
we write business for commercial lines, such as retail businesses, property/building owners, contractors, hotel/motel, restaurants, throughout alaska.
each policy includes forms that state what losses are covered and what are not. the only time i have ever seen where firearms are mentioned in the 8 years i've been in this industry, is in relation to a bar. and it didnt state that firearms werent to be allowed on premises. it merely stated that the INSURED could not have firearms present at the bar. but we never used that form anyways.
we do order physical inspections of just about every insured, and they provide detailed information on the insureds business practices. in the case of a bar, it will tell us how many bouncers they have, what training they have, and it always states "insured has no firearms on premises".
in retail businesses (stores), there is NEVER a clause (from the companies we work with) that states the insureds customers are prohibited from doing anything that is legal.
i'll go so far as to guess that whenever you see a "no firearms" sign, and the manager gives you the "insurance company" line, its a lie. they dont want to be on the hook if their customer is involved in a DGU and they wind up being sued in civil court because the insured allowed firearms on their premises.
we've seen it happen. a guest at a hotel got in a fight over a drug deal, someone got shot/killed, and the family sued the hotel's insurance company.
now maybe the retail agents are giving suggestions to their clients about what they should post, i wouldnt put it past them.
heres another example: many places post signs prohibiting skateboarders or rollerbladers. the excuse always given is "insurance wont cover you if you have an accident."
wrong. their insurance will almost always cover them, and they just dont want to wind up having insurance pay a claim.
now, why dont i explain how losses really impact a commercial lines insured? its rather simple. all insurance BASE rates are regulated by a gov't agency called ISO (Insurance Services Office). they have actuaries that analyze loss data across the country and adjust BASE rates so that countrywide, premiums obtained should cover losses.
but most insurance companies dont do business countrywide. they maybe handle the west coast or east coast, or otherwise have their business centralized. therefore, the losses they wind up paying are going to be higher because they dont have insureds across the rest of the country to cushion the amount they pay.
(whoops, heres where i need to state that there are different kinds of insurance companies: 1. Admitted (also called Standard) and 2. Non-Admitted (also called Non-Standard, or Surplus).
Admitted companies must file rates with each state they write coverage in. they file what is called Loss Cost Multipliers. they take the BASE rates from ISO, and apply a factor to it that their paid actuaries tell them will cover potential losses. this LCM must be justified to each states insurance department, and if its deemed to high, the state wont approve it.
Non-Admitted companies dont have to file their rates, they can charge as much or as little as they wish. and while their coverage is pretty much the exact same (actually its always slightly more restrictive) the company underwriters must be able to justify placing that business in the Surplus Lines.)
okay, so not only does a company deviate from the BASE rates, they then can file to apply debits/credits, we've seen this as high as 80%. we've also seen companies file for "misc deviations", as high as 15%.
example, one company (not gonna name it) has a LCM of 1.504, and has a misc deviation of 1.15, and we can apply a debit of 1.25.
thats (BASE rate x 1.504 x 1.15 x 1.25). thats 216% over what base rates are.
want to know something interesting? as of right now, 95% of all the business we write is at its maximum. we are charging as much as possible, and the insurance companies are riding us because premiums are too low in their opinion.
the BASE rates are variable. they have been dropping, and some lines of coverage have dropped as much as 18% in the last year.
there are other factors i didnt mention that adjust rates, but they arent that important. what is important is that when an insured has a loss (say a customer at a restaurant shoots the waiter because he brought out the soup instead of the salad), the insurance company wont necessarily raise their insurance or non-renew the policy. unless a loss is catastrophic, or somehow recurring, the company usually hangs on.
we do have methods of penalizing an insured for the losses they sustained. we feed in the amounts paid for losses, over a 3 year period, and if they fall under a variable average (variable on how much premium the policy is generating) the insured typically gets a credit. if there were no losses, and the premium is high enough, they definitely get a credit. but if losses were high, they get debited.
over time the insureds do wind up getting shafted for loss history. but far more insureds dont have someone telling them "post signs prohibiting people from carrying guns or having inline skates on their feet".
i'll read some of of the property and casualty coverage forms, just to see if there is anything mentioned about guns, but i'm 99.99% positive there isnt.
