We can get you quotes from multiple companies, but in most cases we already know the one insurance company that will have the best prices and coverage for your particular needs. If the insurance companies see you as a more difficult risk, we will have to submit all of your paperwork to the underwriters for a quote. If you go through multiple brokers and these underwriters receive multiple applications for your company and there is different information in the two applications, the underwriter might just decline to cover you. 

 

Another problem could be that we go to an underwriter that puts a great deal of work into getting you a quote only to find out that the quote has already been released to you through a different agent. This is a waste of our time and our underwriter’s time and you should tell us if you already have a quote so that we can avoid looking for a quote that you have already received from the same insurance company. Our prices are fair, we know what we are doing, and you can depend on Orr & Associates Insurance Services to get you the certificates and additional insured endorsements that you need.

We search the markets for the best possible prices and policies for your insurance needs. In our search, we will consider companies with various A.M. Best Ratings, Risk Retention Groups, Wrap Policies, and companies doing business on both an admitted and non-admitted basis.    

 

A.M. Best is an independent company that rates the financial condition of various insurance companies. You can go to their website at www.ambest.com. As a rule, we only look at A rated companies unless no A rated companies will cover the risk or if there is a significant financial savings by going with a B or non-rated company. Something you should consider is whether you have clients that require that you have an insurance company with a certain rating. You do not want to lose your best client because he or she requires you to have a policy with an A-7 rated company and you went with a B rated company.

 

Many large contractors are moving toward risk retention groups because fewer and fewer other insurance companies will cover contractors in California at all or at a competitive price.

I describe RRGs by saying that they are more like credit union whereas other insurance companies are more like banks. That is, all of the insureds of an RRG are part members of the company and the premiums paid are used, if necessary, to pay for any claims.  Because the insureds are part owners, you have to fill out a subscription agreement with the application.  It is even possible—at least in theory--that a dividend would be paid to the members if there were ever substantially more premiums collected than claims paid.

 

Insurance companies do business in California on either an admitted or non-admitted basis. Insurance companies that do business on an admitted basis are a part of the California Insurance Guaranty Association (CIGA) and purchasers of a policy with a non-admitted company need to sign a form stating that they know that the company does business on a non-admitted basis. There is some bureaucracy involved in becoming an admitted company and some highly rated companies have chosen not to do business on an admitted basis. Common examples of these companies are Lloyds of London, Burlington, and Century Surety. This is not a reflection on their financial strength or their ability to pay claims. The California Department of Insurance maintains a List of Eligible Surplus Line Insurers (LESLI) and has strict requirements for these companies. The following link shows the List: http://www.insurance.ca.gov/FAD/Surplusl.htm. 

 

The purpose of the association is to establish a mechanism to pay claims that are unpaid as a result of the insolvency of a member insurer. The maximum amount that will be paid to a claimant, insured by an admitted insolvent insurer, is the lesser of the amount of loss, the limits of the policy, or $500,000, subject to a $100 deductible. Insurers and agents are prohibited by law from using the existence of the Guaranty Association to induce prospects to purchase insurance policies. So, I cannot tell you that you should buy from an admitted company over a non-admitted company because then you would have the benefits of CIGA. And, in fact, I would not because in many cases non-admitted companies are a better option (or the only option). Whether a company is admitted or non-admitted, I recommend that clients check the insurance company’s financial ability to pay claims by looking at the insurance company’s A.M. Best rating.