Business owners, quick question: Have you REALLY read over your insurance policy? It’s a funny thing, to be honest… I once asked a potential client how much he paid for the last book he bought. He said it was $25. I went on and asked if he had read the book and he answered “yes.” I then asked if he had read over his cargo policy and he answered “no.” This client had paid $25,000 for this policy which contained less than 5% of the words in the last novel he purchased and read. Why on earth did he not read over his policy? His response: “It was too difficult to understand.” Does this sound like you?
As an owner in the moving and storage business, it is critical to read over your policy and fully understand what it is saying. While I may not have the authority to force clients to read over their policy, I do feel the need to express my concern. I know that ANY buyer of a motor truck cargo or warehouseman’s legal liability insurance policy will generally, at SOME point, experience a major loss if he or she does not take the time to read the policy over and learn what it will or will not cover.
Motor truck cargo and warehouseman’s legal liability are especially tricky policies. Why? Allow me to give you a quick explanation…
All states regulate the sale of insurance. State insurance “departments” control policy language and the pricing when it comes to the majority of insurance policies. HOWEVER, not all insurance is subject to the same degree of regulatory control, For instance, Marine Insurance, both Ocean and Inland. Motor truck cargo insurance and warehouseman’s legal liability both fall under Commercial Inland Marine (CIM.) Translation: Inland marine underwriters are free to write their own terms and conditions. Motor truck cargo and warehouseman’s legal liability insurance policies are “tailored” and “custom-fit” to properly cover buyers’ exposures and needs.
This may sound great, but it can be both good and bad. With this type of system, the insured will LITERALLY get exactly what he or she pays for. The good news: business owners in the moving and storage industry can get WHATEVER coverage they need, for a price, of course. If the underwriter wants a coverage removed, it can also be removed. However, this freedom also means that these policies may be subject to gaps and errors in “tailoring.” This is where the trouble may begin!
The bottom line: instead of tackling that $25 book you just bought, it may be time to give your $25,000 movers insurance policy a thorough read. If you are not convinced, you should come back next week. We will be discussing the possibility of coverage gaps.