Have you ever received a phone call from someone representing your insurance company asking if they may stop by for a loss control survey? A loss control survey? What does this mean? The fact is, for most insurance companies, this is a very valuable tool that completes the underwriting process on your policy.
Think back to when you first looked for insurance coverage. You went to your agent and they found you a commercial insurance policy. With this policy, the insurance company promised to pay for your covered losses when they occur. You went through the painstaking process of gathering loss runs, building updates, product information, and any other information the underwriter needed, almost giving up your first-born in order to get that policy. Then, finally, your receive your policies from your agent (or online for those who have gone green). Ok, good. Glad that’s over, I’m covered! Well… you may not be done yet.
Depending on the type of business you operate, the size of property values you have, or the amount of vehicles in your fleet, your insurance company may want to see things for themselves. Whether you like it or not, there is some verbiage, buried deep in one of your policy forms, that says your insurance company has the right to inspect your operations.
But don’t worry! This isn’t a bad thing! Loss control is a collaborative effort to not only help the company know what they are covering, but also to help you, the policyholder, with safety measures, training topics, and loss analysis, among other things. No one wants to experience a loss of any kind, but that’s exactly what your policy is for – to pay for covered losses that result from accidents or catastrophes. While you can’t control when an accident or catastrophe happens, you can help prevent or limit the damage in some way.
So, if you receive a phone call from someone saying they represent your insurance company and want to stop by for a visit, how should you handle it? First, it’s common to be a little leery in this day and age of someone who calls and wants to come into your home or business. If you don’t feel the consultant has properly identified themselves, call your agent or the insurance company to verify their identity. Your agent may also be able to give you some insight into why the insurance company feels an inspection is necessary. More often than not, it’s just standard operating procedure. And remember, this is your business, so I encourage you to make yourself a part of this process. If you are not available, use one of your lead managers. The loss control representative may have some questions that need to be answered, or see some things that need explanation.
You should also take the opportunity to ask questions you may have about any safety issues or training for your employees. Loss control consultants (sometimes referred to as loss control engineers) are trained in life safety codes. They also know loss prevention and reduction methods. They may have suggestions for your operation or make formal recommendations.
Remember, loss control representatives are not to be feared! Their purpose is to help you run your business as efficiently as you can by either preventing losses from occurring or reducing the severity of the ones that do. And from my perspective as an underwriter, the loss control folks are my eyes. They allow me to see what couldn’t be submitted on a paper application which not only allows us to spot potential risks and help prevent or reduce the risk, but also help us charge an adequate premium for your coverage. And that results in savings for both you and the insurance company. That’s not a loss but a win-win!