[home615]

So I have gone through all the proper steps to become a business and secure insurance. Now that I am applying to companies, they are telling me I have to carry insurance from a company they suggest. Did I just screw myself on a year's worth of general liability? And thank God I haven't purchased the E&O yet! What if each company requires a different carrier!?

 

[wildnwonderful]

My responce would be.....If your going to pay for it ill use your company, and if not i will use company of my choosing since I PAY FOR IT!!!!

 

[APlusPPGroup]

They cannot tell you who you have to use. They would be restricting how you operate and the law won't allow it.

Worst case scenario, they just won't send you any work. You don't want to work with anyone who has a requirement like that. They are walking a fine line, telling you who you have to use.

I would just tell them that, if the insurance policy you purchased doesn't work FOR them, you'd rather not work WITH them.

You might be surprised at their response. They may send work anyway so stand your ground.

Bottom line is......... NO ONE tells you how to run your business!

Linda

 

[brm1109]

Insurance

I had that happen, I told them that I use who I want as long as the coverage is the same. When they refused I just declined working with them.

 

[The_Game]

It is called being a control freak...just walk away from the problems before you work for him. Imagine when it is time to get paid and you didn't nail the nail with the right brand hammer. Believe me, I'm talking from experience.

 

[EthanB]

I agree with all of the above. Once you bend over it's all down hill.:blink:

 

[JenkinsHB]

The biggest pitfall is getting E&O insurance that doesn't actually cover you for what you are doing. There are only a few E&O providers that specialize in property preservation. I think most of the big guys just want to make sure you've got the right stuff.

 

[home615]

I am all for getting the proper E&O insurance and will take any suggestions on the companies to go to. I purchased the general liability because I knew I had to have it to even think about getting started. I was just dumbfounded when the place told me I had to use their general liability. Made me wonder if there was a kickback.

 

[JenkinsHB]

I've never run into anyone requiring a specific liability. But I have with e&o. Don't listen to these other guys that aren't even in the industry.

 

[foothillsco]

I'm surprised at the responses here.

I disagree with all of them.

So the company wants you to use their carrier. Two of my nationals will only work with the same 3 companies that have industry specific policies.

So you paid for a years of insurance. You know you can cancel that and get a refund?

But the real point is, your in business and this **** happens. Your surprised that you might have a hurdle to go through? Then your not really serious by trying hard.

This can be a great business if you don't listen to all the whiners here and people who tell you what you ought to do from their keyboard.

 

[BPWY]

Made me wonder if there was a kickback.

Your thinking is on the right track.

 

[MidwestP&P]

We've gotten this notice from 2 of our nationals as well. By April of next year we have to switch to 1 of the 4 "approved" E&O carriers. I completely agree with you guys -- it's C**P -- but really, if I tell them to take a hike, they will tell me to go take a hike and I can't really afford that!! We carry E&O altho not from any of those 4 companies because the cost with them was so ridiculuously high. According to my general liability insurance agent, he says there is no reason why we have to carry it anyway but it was a catch-22 -- if you don't have it, you don't work. If there is some "polite" way to say NO to the 'demand' order, I would love to hear it! I certainly don't want to but really don't see a way around it without losing my clients...and I'm really trying to avoid changing the locks on my own house!

 

[STARBABY]

I've never run into anyone requiring a specific liability. But I have with e&o. Don't listen to these other guys that aren't even in the industry.

FAS is the only company that has demanded I carry E&O.

 

[thanohano44]

We've gotten this notice from 2 of our nationals as well. By April of next year we have to switch to 1 of the 4 "approved" E&O carriers. I completely agree with you guys -- it's C**P -- but really, if I tell them to take a hike, they will tell me to go take a hike and I can't really afford that!! We carry E&O altho not from any of those 4 companies because the cost with them was so ridiculuously high. According to my general liability insurance agent, he says there is no reason why we have to carry it anyway but it was a catch-22 -- if you don't have it, you don't work. If there is some "polite" way to say NO to the 'demand' order, I would love to hear it! I certainly don't want to but really don't see a way around it without losing my clients...and I'm really trying to avoid changing the locks on my own house!

the only thing that I can think of is that those 4 companies who they say you have to go with might have a policy that will cover you. Perhaps, FREMONT can assist with this one.

 

[thanohano44]

FAS is the only company that has demanded I carry E&O.

that's odd...all of the nationals that we are with require us to carry it. the regionals we do work for do not.

 

[MALCO.New.York]

COST of DOING Business!


EVERYBODY gets paid.

 

[GTX63]

We informed these Nationals that sent us notices that either
a. They did not supply us with the sufficient volume to justify carrying their specific insurance.
b. Our current GL and E/O policies covered all work that we were qualified and licensed to perform.

They all backed off and continued to send work. The bottom line to them is how many other contractors do they have in your area. Ours, not so many, so they let it go.

 

[BPWY]

We've gotten this notice from 2 of our nationals as well. By April of next year we have to switch to 1 of the 4 "approved" E&O carriers. I completely agree with you guys -- it's C**P -- but really, if I tell them to take a hike, they will tell me to go take a hike and I can't really afford that!! We carry E&O altho not from any of those 4 companies because the cost with them was so ridiculuously high. According to my general liability insurance agent, he says there is no reason why we have to carry it anyway but it was a catch-22 -- if you don't have it, you don't work. If there is some "polite" way to say NO to the 'demand' order, I would love to hear it! I certainly don't want to but really don't see a way around it without losing my clients...and I'm really trying to avoid changing the locks on my own house!

During the next 12 months I'd wrack every brain cell that you have to come up with some plans to diversify.
In P&P's current business model it is not a good place to stay long term!

 

[MFSOracle]

For those who don't understand Errors and Omissions insurance (E&O) in the P&P industry, here's a quick primer:

General Liability: covers you for work you performed

Example: you install a new staircase; somebody falls on the staircase and gets hurt - they claim your work was defective - GL pays to defend you or pays the claim​

E&O: covers you for information you provided (or should have provided) - hence the ERROR or OMISSION

Example: you fail to report a roof leak even though your photos show water stains on the ceiling - client claims you are responsible for all the new water and mold damage - E&O policy may cover the loss​

In many cases the quality of the work you perform is FAR less relevant than the information you provide to clients. In P&P, the banks and nationals woefully underpay for the information they hold vendors accountable for - they expect full-blown home inspections to be covered by the fee to change a lock, winterize, or even for the privilege of submitting a bid (i.e. free).


So why do nationals require you to use their select E&O carriers?

1) It's easier for them to submit a claim against your policy; especially after you quit doing work for them because you figured out that it's not worth it​

2) They argue that these "select" carriers have a better understanding of the P&P industry (honestly, they probably do have a better understanding)​

3) It's easier for them to submit a claim against your policy; especially after you quit doing work for them because you figured out that it's not worth it​

 

[P3+]

Forgive me but I need to rant a moment.

Why do so many of these other trades users on here feel the need to interject into a conversation they know nothing about? Nor do they have the insight to offer credible input? It's downright frustrating to see these posts that offer absolutely no value to the conversation being had.
My take is this: A: They just want to feel important and boost their thread count B: They are of the "know it all" type
or the more likely.... C. They are doing pp work and simply won't fess up to it out of shame

I don't do any electrical work. I wouldn't even think to go into the electrical forum and start telling others how to run their business, or offering advice on something I have very limited knowledge of.

Rant over!