Confessions of an Insurance Rep: What We Look for Before Giving You a Price
By Avalon Thomas-Roebal
Illinois Casualty Company
Illinois Casualty Company (ICC) has become a leading food and beverage carrier within a competitive marketplace since our inception in 1950. Our dedication to the industry has allowed ICC to understand the unique complexities of the niche and how to fine tune our rating structure to maintain profitability. Continued experience allows ICC to identify exposures distinctive to hospitality that other carriers likely do not recognize and has led to the development of a comprehensive rating system.
Some rating factors are quite standard. Other factors, which you may only see with ICC, have been applied because we are truly a specialty carrier. Though we can’t share our recipe for success, we can share how some ingredients may be more impactful than commonly thought. Knowledge of these exposures has allowed ICC to rate risks appropriately and provide consistent pricing to our insureds.
Property coverage premium continues to rise in all areas of insurance. What factors have a bigger impact on food and beverage accounts? Most carriers consider construction type and building age, but ICC also takes into consideration the years in business, onsite laundry facilities, seasonal operations, and security camera usage. These items all have rating relativities that modify property premium.
ICC is best known for our ability to profitably rate for liability coverage, especially liquor liability. Distinctive exposures in this product line may be unfamiliar to general carriers but second nature to those at ICC. For Businessowners Liability, years in business, prior management experience, and hours of operation are common factors, but ICC is not a common carrier. We have learned that the number of pool tables, buffet exposures, self-serve drink stations, cover charges, and trap door exposures also carry weight in determining pricing.
For example, a single pool table in a tavern is more likely to lead to an altercation than multiple pool tables. If you walk into a bar and notice a pool table, where do you see it? Typically, it is placed in a back corner, dimly lit, and commonly by restrooms and in a busy footpath. Those playing pool may encounter passerby bumps, spills, or patrons not respectful to the game environment. When alcohol is involved, or better yet, a $20 bet, these minor bumps and spills have a higher likelihood of becoming arguments. When establishments have multiple pool tables, the space tends to transform into a pool hall mindset with dedicated pool players and a designated playing environment, which in turn leads to more responsible participation.
Further experience in this niche has consistently shown that establishments located outside city limits have higher liability exposures. This is in part due to more patrons leaving by automobile and the establishment typically having lower drink prices, both factors that contribute to having a higher rating relativity. Insureds with buffets and/or self-service drink stations will have a higher probability of slip and falls. When customers serve themselves and spill something on the floor, they typically do not notify staff. If a server spills food or drink on the floor, they know it right away and can address it.
ICC’s Underwriting and Marketing Departments educate our agency partners on many of these exposures, while ICC’s Loss Control Specialists educate our insureds. Unique loss control recommendations based on our years of experience shine through during our inspection process. ICC requires a metal container to hold oily rags due to spontaneous combustion, we consider trap doors an undesirable exposure, and we follow the National Fire Protection Association requirements for fire suppression and hood and duct maintenance.
As an ICC Marketing Representative, I frequently field these common questions, “Why does Underwriting ask so many questions?” or “Why do your Loss Control Reps require additional recommendations?” Those answers are easy. We do so because ICC is a dedicated specialty carrier where we lead in industry knowledge, underwriting skill, and exposure identification, ultimately allowing ICC to provide consistent pricing for our insureds.
The rating factors ICC has developed demonstrate our deep understanding of the niche. We have led the industry in commitment and unparalleled service to hospitality, and our rating system and multifaceted underwriting approach reflects that dedication.
To find an ICC agent in your area, visit www.ilcasco.com/find-an-agent.
The above story was published in the November 2022 edition of Pennsylvania Beverage Media, the official magazine of the Pennsylvania Licensed Beverage and Tavern Association. Illinois Casualty Company is the PLBTA’s exclusive preferred vendor for liquor liability and other business insurance.