What Are Loss Runs, and How Does that Affect Me as a Contractor in 2022?

Is Hold Harmless the Same as Indemnity?

The loss run report is an insurance company’s history of a business. The report acts as a risk management strategy as it helps the prospective insurer to assess a business’ eligibility when the latter is willing to buy new insurance products. 

Similar to a credit card score, which enables banks to determine the individual’s reliability to pay back debt, loss run reports are usually generated by the insurance provider to show the claim activity on each individual policy the customer purchased.

A loss run report allows the insurer to examine:

• The frequency of the past claims
• Whether an of the prior claims are active or closed
• The types of insurance claim the business has filed in the past
• The financial effect such as the settlement costs of the claim

Gathering and evaluating this information will allow an insurer to understand if you are an average-risk or a high-risk customer. It will help them to decide if they can charge a high premium or decline to issue a new policy. 

In this article, we will discuss everything you need to know about insurance loss run reports, why they are needed, how you obtain one, and similar information. 

Types of Business Insurances Loss Runs Are Used In

Insurance brokers provide loss run reports for a wide variety of insurance products that includes, but is not limited to:

• General liability insurance
• Commercial auto insurance
• Business owner’s policy
• Worker’s compensation insurance
• Commercial property insurance

General Liability Insurance

Businesses with general liability insurance coverage get comprehensive safety from a number of risks that include any kind of customer injury, advertising injury, or property damage. 

Small business owners must opt for this kind of insurance, as it prevents them from the expensive lawsuits that include spending heavily on the lawyer’s fees. 

The insurance will pay for everything, from an attorney’s consultation fees to the trial fees and final settlements. It also includes professional liability that includes protection from the civil lawsuit for common mistakes, errors and omissions, misrepresentation claims, negligence, and more. 

Business Owner’s Insurance

A business owner’s policy is a comprehensive package of general liability insurance and commercial property insurance. To evaluate if your business is eligible for business owner’s insurance policy, you must meet the following criteria.

Your business must operate in low-risk areas, have less than 100 employees, own or rent a small commercial space, and have an annual revenue of less than 1 million dollars.

Commercial Property Insurance

Commercial property insurance covers the repair and replacement costs for destroyed, damaged, or stolen commercial property. If you own a commercial space, this type of insurance bears the costs for commercial space, product inventory, and tools and equipment. 

Similarly, commercial auto insurance covers the costs of damage to the vehicle being used on the job site. It covers legal bills, property damage, medical expense, and other minor or major damages on the vehicle.

Workers’ Compensation Insurance

Workers’ compensation insurance gives employees coverage against the lost wages and medical bills in the case of work-related injuries. When you opt for loss run reports, make sure you get one on time, else, you will be eligible for refunds.  

The terms of the policy may vary from locale to locale, but every small business must invest in buying this coverage to safeguard themselves as well as employees from future legal claims. Some states have mandated workers’ comp insurance to protect employers from paying medical expenses when the employee got injured at the workplace. 

When Would You Get a Loss Run Request

Depending on your business and the policy you invest in, you may receive the loss run details in the beginning. When the small business is dealing in risk-intensive jobs, it may need loss runs in order to examine the organization’s safety culture. 

A loss run request is something that is requested at the time of submitting the loss run report request. It may include details such as:

• New insurance policy
• Claims history
• Policy number
• Insurance agent

What Is in a Loss Run Report?

A loss run report is an in-depth insight to how you have used your business insurance during the insurance policy periods. In case your organization has never filed a claim and has no loss history, the loss run report will mention “no losses reported”. 

Else, the loss run report will include several important details about the insurance policies such as the following information. 

• Policyholder’s name
• Policy number
• Dates of claims to insurance companies
• Dates you notified insurance agent of losses
• Claim history descriptions
• Settlement costs
• If the claim is open or closed

How You Can Get a Loss Run Report

The simplest way to get your loss run report is via contacting your insurance agent and simply asking for it. It might not be as easy to get a loss run report for you on your own as it would be for your broker. 

So, do not fret and ask the insurer right away to expedite the process instead of spending time searching for information. For insurance companies, these reports are a part of the business. When you contact your insurer regarding the same, don’t forget to provide the relevant information such as:

• What insurance policies are you looking to get the loss run report for
• How much detail (year of reporting) would you need 
• When do you need the reports (estimated date)

All the information put together turns out to be the essential process of the insurance underwriting process. 

In many states, it is mandatory to provide the requested information within 10 business days or less. If you feel that the insurance agent is unnecessarily delaying or avoiding handing over the report to you, you may reach out to the State Insurance Department to file a complaint. 

How Long Do Loss Run Reports Take?

Usually, the time period in which a business can get the loss run report depends upon the insurance company. However, as mentioned earlier, many states have made it mandatory for insurance companies to provide the same within 10 business days from the date of request. 

Streamline Your Loss Run Reports with Contractors Liability

Loss run reports are quite a technical aspect of insurance and not many people know about it. Since, there can be a number of factors involved in the entire process from requesting the report to finally getting one, contacting a specialized agent can help reduce the turn-around time, particularly when you need it urgently. 

Contractors Liability houses a team of proficient insurance experts with years of experience in dealing with such tasks. Requesting loss run reports is a part of the day-to-day business and our qualified experts are well acquainted with the right procedure to get your reports as fast as possible. 

Contact (866) 225-1950 (English) or (888) 245 0633 (Espanol) to speak with our insurance expert and get answers to your questions related to loss run reports! Or click here to get a free quote!