Group Health Plans Insurance Services Benefit Products Michigan Contact Lakeland Underwriters
Employee Benefits   |   Health   |   Life   |   Short term   |   International   |   Disability   |   Property & Casualty  |  Dental
Property and Casualty


Property and Casualty FAQs

We have accumulated the following list of common questions.  Click here for more information and/or a quote.

Payments
Do I need to pay the entire premium up front?


Property Coverage
What is Property Coverage?

What is Business Income Coverage?
What if a dissatisfied employee destroys parts of my business?
What is a Businessowners Policy?
The insurance company is asking what type of alarm system I have.

Liability Coverage
What is Liability Coverage?

How does an Umbrella Liability policy work?
How can my business be covered for wrongful termination suits or sexual harassment?
What is Professional Liability Insurance?

Workers' Compensation
When do I need to buy workers' compensation?

How much does workers' compensation cost?
What does workers' compensation do?
I subcontract work to other contractors, but I have no employees - just my partner (half-owner). Do we need workers' compensation on ourselves?
Does business insurance have to be bundled in a package including workers' compensation?

Commercial Auto
What is commercial auto insurance?

Will my employees' personal cars be covered under a commercial auto policy if they are using their cars for business?
When should I drop the comprehensive and collision on my old cars?

Starting your Business
We need insurance for our new contracting business and we don't have a lot of money. What will we need to start our operation?


Home Business
What type of insurance do we need for our home based, consulting business? My partner and I work at home and we have one employee who works at his house. We have just incorporated. Would we be covered under our homeowners policies?


Payments

Q:

Do I need to pay the entire premium up front?

A:

Not usually. Depending on your premium size, most insurance carriers allow different payment plans. The company will bill you directly and give you the payment options at that time. Most are 25% down and 8 or 9 payments, or 12 equal monthly installments.

return to top

Property Coverage

Q:

What is Property Coverage?

A:

Building and business personal property, or contents, coverage protects your buildings and equipment, stock, furniture and fixtures. Some policies include breakdown and business income coverage.

Q:

What is Business Income Coverage?

A:

In the event of a covered loss, this coverage may reimburse you for the net income that would have been earned if fire or other covered causes of loss had not occurred. Losses due to down time or extra expenses needed to restore operations (such as additional property rental) may be covered.

Q:

What if a dissatisfied employee destroys parts of my business?

A:

If any of your employees commit a dishonest or fraudulent act that results in a financial loss to your business, some policies will cover this type of loss.

Q:

What is a Businessowners Policy or a BOP?

A:

A BOP is a package policy for small businesses that do not require extensive individual underwriting. It combines property and liability coverage in one policy and generally includes additional coverages at no additional premium. Most insurance carriers have customized BOPs for particular industries and services.

Q:

The insurance company is asking what type of alarm system I have.

A:

Ask your alarm provider or company to supply a certificate stating the type of alarm. Send the certificate to your insurance carrier. Most insurance carriers will allow credits to your premium for qualified alarm systems.

return to top

 

Liability Coverage

Q:

What is Liability Coverage?

A:

There are many different types of liabilities to be covered for a business. Business liability may protect you from claims arising from customer bodily or personal injuries. Other items that could be covered:damage to the property of others, products-completed operations, advertising, premises operations, fire, legal liability and related legal defense costs.

Q:

How does an Umbrella Liability policy work?

A:

In the event of a catastrophic loss, the umbrella policy provides excess policy limits. Once the underlying limits of the Business Auto, General Liability and Employers Liability policies are exhausted, the Umbrella Liability Policy would provide further coverage up to the limits of that policy.

Q:

How can my business be covered for wrongful termination suits or sexual harassment?

A:

Many insurance companies offer Employment Practices Liability insurance (EPLI) as part of their Businessowners Policy or as a stand-alone policy. EPLI may cover wrongful termination, sexual harassment, discrimination, mental anguish and other employment- related litigation.

Q:

What is Professional Liability Insurance?

A:

Otherwise known as malpractice insurance, professional liability insurance protects your business against claims resulting from professional services rendered by you to your clients. This type of insurance would cover you and your employees in the event someone claims you incorrectly performed or failed to perform your professional duties. Most business policies exclude coverage for professional services. They can, however, be purchased independently.

return to top

Workers' Compensation

Q:

When do I need to buy workers' compensation?

A:

In most states, workers' compensation is required when you have one or more employees. Usually, the state penalties for employers who do not purchase workers' compensation are very stiff. There are a few states that do not require employers to carry workers' compensation coverage.

Q:

How much does workers' compensation cost?

A:

Workers' compensation pricing is based upon your employee payroll, the number and job classification of the employees, classification of your business and past loss experience. The employer pays for the cost of the workers' compensation.

Q:

What does workers' compensation do?

A:

Workers' compensation pays for the rehabilitation, recovery or medical bills of employees' work related injuries, as well as lost time when they are off work due to a work related injury. Workers' compensation is not a substitute for health or medical insurance, since employees are only covered for on- the- job injuries.

Q:

I subcontract work to other contractors, but I have no employees - just my partner (half-owner). Do we need workers' compensation on ourselves?

A:

Yes and no. The contractor to which you subcontract is required to have proof of workers' compensation for all workers (including you) in case a claim is submitted. However, your contract for subcontract work and proof of sufficient liability coverage may suffice as a substitute to carrying workers' compensation. The contract should include the facts that you have no employees, you are sole proprietors and the fact that it is a valid sub-contract.

Q:

Does business insurance have to be bundled in a package including workers' compensation?

A:

Some insurers bundle workers' compensation with smaller policies such as a Businessowners Policy (BOP). Some companies do write workers' compensation separately or "monoline."

return to top

 

Commercial Auto

Q:

What is commercial auto insurance?

A:

Insurance for automobiles, trucks and vans used for business purposes falls under commercial auto insurance. If you own a business and use personal vehicles for business purposes, you should consider a commercial auto policy. Many personal auto insurance policies exclude coverage if a vehicle is used mainly for business. Commercial auto insurance is sometimes called business auto insurance.

Q:

Will my employees' personal cars be covered under a commercial auto policy if they are using their cars for business?

A:

Most commercial auto insurance policies cover the liability for your business of employees using their own cars for business. However, the employees' personal auto policy would be the primary coverage for damage to their automobile.

Q:

When should I drop the comprehensive and collision coverage on my old cars?

A:

If you have an outstanding loan on your car, most lenders require comprehensive and collision coverage. If you or your business own the vehicles outright, then the decision should be based upon your financial reserves and the value of the car. Is the value of the car close to the premium paid for comprehensive and collision? Do you have liquid funds that could be used to replace the vehicle if destroyed or stolen? Can you buy another vehicle of this type? There are many factors to weigh and consider.

return to top

 

Starting a Business

Q:

We need insurance for our new contracting business and we don't have a lot of money. What will we need to start our operation?

A:

Small contractor packages are readily available in the marketplace. Most are priced competitively and include the coverages you will need such as liability and equipment (property). If you have employees, some packages can include workers' compensation, depending upon your state. Pricing is based upon the coverage needed for (the size of) your operation, experience in claims and business, and your payroll and revenue.

return to top

Home Business

Q:

What type of insurance do we need for our home- based, consulting business? My partner and I work at home and we have one employee who works at his house. We have just incorporated. Would we be covered under our homeowners policies?

A:

Business coverage is very limited in the typical homeowners policy. Some homeowners policies have the ability to add business coverage. In most cases, the coverage is not adequate to cover an incorporated business with employees. A businessowners policy may be better suited for your business. Coverage will include liability for you and your employees, equipment, loss of income and buildings (home office). Since you have one employee, workers' compensation is needed in case of on the job injuries. Since you have an home-based business, the relative cost of a BOP for this type of business is low.

return to top


8888 Commerce Rd.   |    Commerce Twp., MI    48382    |    Phone:  248.363-1600    |    Fax:  248-363-2129 

Email Contact   |   Michigan Business