Diligence in the midst of increasing insurance rates

As a pool professional and business owner, your pool company faces risk daily. General liability insurance helps protect your business’ financial assets, intellectual and physical property from lawsuits. By paying your premium for insurance policies, such as general liability or commercial property, you will have a financial backstop to protect your business against a potentially devastating major incident.

For example, if you overfill a pool and damage a customer’s property, this would be covered unless excluded from your policy.

While every business needs insurance to protect its assets from unexpected losses, insurance can be costly. A typical small company spends about $99 per month for a business owner’s policy and $111 monthly for workers’ compensation insurance. That’s an annual cost of $2,520 for just two policies.

Prices are increasing everywhere, from pool chemicals to gas, groceries, wages and more. What’s driving rates in the insurance industry? Rates for these coverages continue to climb due to a number of factors including rate inflation, loss exposure, loss experience and other risk characteristics. Large judgments, the cost of litigation and a rising tide of lawsuits against businesses also affect rate increases.

Simply put, rates are increasing because insurance companies are losing money. According to estimates from A.M. Best, U.S. insurers have lost $36 billion over the past two years on all property/casualty policies. The whole industry is raising rates to react to market forces.

Although sometimes rate increases are inevitable, keep your rates low by keeping your claims low. Continue to educate yourself on common pool industry claims. I always recommend keeping records, chemical logs and a clear picture of all your client accounts. Additionally, have a contract in place with all customers that clearly outlines your scope of work.

Learning the industry’s challenges requires significant effort. As a pool professional, it’s important to be insured properly to have the support of a group, agent or program that can fight for your insurance needs. There are great groups in the pool industry that can advocate for you as a pool professional. It’s your job to be sure they are growing and aiding your insurance requirements. May this year bring all pool professionals luck, prosperity and the education to keep industry claims low.