- Loss runs are a record of all claims filed against an insurance policy. They can be used to assess the risk of insuring a property or business, and to determine the appropriate premium.
- To get loss runs, you can contact your agent or carrier. They will be able to provide you with a copy of your most recent loss runs.
- Loss runs need a recent valuation date, typically within 30, 60, or 90 days of the application date, to ensure accurate risk assessment by carriers.
Don’t Get Blindsided: Understanding Loss Runs for Smoother Business Insurance
Running a business involves managing risks, and having the right insurance is crucial. But how do you know if your current coverage is adequate? That’s where loss runs come in. This blog post will shed light on loss runs, their importance, and how they can empower you to make informed decisions about your business insurance.
What Exactly is a Loss Run?
A loss run, also known as a loss history report or claim history report, is a document provided by your insurance carrier. It essentially functions like a record of all the claims you’ve filed under a specific business insurance policy, typically spanning a period of 3 to 5 years.
What Information Does a Loss Run Include?
Here’s a breakdown of the key details you’ll find in a loss run report:
- Policyholder Information: This includes your business name and policy number.
- Coverage Dates: The time frame covered by the report.
- Claim Details: A breakdown of each claim filed, including:
- Date of Loss
- Cause of Loss (e.g., fire, theft, vandalism)
- Description of the Incident
- Amount Paid by the Insurance Company
- Status of the Claim (open or closed)
Why Are Loss Runs Important?
Loss runs serve a vital purpose for both you and your insurance company:
- For Your Business:
- Risk Assessment: Loss runs provide valuable insight into your business’s past claims history. You can identify patterns or trends and implement strategies to mitigate future risks.
- Renewal Negotiations: When it’s time to renew your insurance policy, your loss run report can be used as leverage during negotiations. A clean claims history can potentially lead to lower premiums.
- For Your Insurance Company:
- Risk Evaluation: Loss runs help insurance companies assess your business as a potential risk. They use this information to determine your insurance eligibility, coverage options, and premium rates.
How to Obtain Your Loss Run
Obtaining your loss run is a simple process. You can typically request it from your insurance agent or broker. There might be a small administrative fee associated with providing the report.
Understanding Your Loss Run:
Once you have your loss run, take some time to review it carefully. Here are some questions to consider:
- Are there any unexpected claims?
- Are there recurring types of claims?
- Is there a pattern to the causes of loss?
By analyzing your loss run, you can gain valuable insights and take proactive steps to improve your risk management strategies.
The Takeaway:
Loss runs are powerful tools that can benefit both you and your insurance company. Regularly reviewing your loss runs empowers you to identify potential risks, negotiate better insurance rates, and ultimately, ensure your business has the right coverage in place. So, don’t be afraid to request your loss run and use it to your advantage!