“The customer is always right.” We remember when this saying meant something in terms of customer service, respect and the attitude that any business serving the public was actually committed to that end. Of course, the reality is that as much as we honor the spirit of the customer always being right, there are times when this simply isn’t so, and we have to deal with it.
A case in point is a long-time builder who I’ll call Builder X. After renewing his commercial general liability (CGL) policy multiple times, he failed to pay his premium and was cancelled. As much as we love our member builders, they have to pay their bills. Months later Builder X reapplied for CGL coverage. He offered no explanation for his earlier lapse nor could he tell us about any work he planned for the next 12 months. A new signed application that we requested raised more questions. A Google search turned up a consumer-oriented website that listed public information about Builder X’s contractor license – it had expired soon after our policy was cancelled. The reason? Failure to maintain CGL coverage. As I write, we are waiting for answers to our underwriting questions. We’ll see.
Contrary to what some may think, underwriters are not waiting for unsuspecting applicants to submit lengthy applications just so we can decline to quote. We can’t make money unless we sell policies and, just like you, we hope to make a profit. We do this first by understanding the builders we insure. We need to be reasonably certain they aren’t under such serious financial pressure that they can’t do quality work. No builders we know of deliberately cut corners but some have been driven to such extremes for lack of money to pay subs or purchase quality materials. Here we have a former insured builder with an excellent loss history who first couldn’t pay his premium, and then let his professional license expire. Is there a reasonable explanation? Most likely there is but we can’t read minds. We need this builder to communicate with us.
Many who may read this blog have dealt with underwriters’ questions openly and honestly only to be declined or charged more premium. I get it. But consider this; have you ever taken on a construction project that turned out to have unexpected costs? Have home buyers hit you with change orders and demanded no increase in estimates? Isn’t it true that you often bend over backwards to accommodate your customers? Isn’t it also true that you need to fully understand what is going on with your customers before you can help them?
The RWC Insurance Advantage specializes in residential general contractors. Being a risk retention group, we can’t insure anything else or provide any coverage except general liability. Each insured builder is a member of a RWC warranty company and is treated as a member deserving every consideration. This means that we are designed to bend over backwards whenever we can. It also means we have an obligation to protect all the members of the RWC Insurance Advantage. The premium you pay is at least partly based on the experience of the membership. There are limits to how far we can bend and to when the customer can no longer be right in order to protect the interests of all members.
With some insurance companies, Builder X would have been rejected just because of the recent cancellation for non-payment of premium. The previous years of good profitable experience would have meant little. Most underwriters would not spend time seeking information they felt should have been included in a cover email with the new application. Technically, they’re right. That’s not how we do business. With us, the customer may not always be right but they will always be heard.
Have you experienced a problem with your CGL coverage or your business that you feel may make it harder for you to get a quote? Give us a call at 1-866-454-2155 or visit us on the web at https://rwcinsuranceadvantage.com/contact-us/. If we can find a way to offer a quote, you’ll get the best offer we can provide. But if we can’t quote, you will be told the specific reason.