Insurance Tips for Lawn Care and Landscaping

There are many aspects to owning a landscaping business. Many aspects that have nothing to do with the actual work itself. Whether a business owner is dealing with finding the right employees, determining the right price to charge their customers or managing the day to day operations; there are always additional responsibilities pulling the business owner in a different direction.  One aspect that frequently gets looked over is purchasing commercial insurance for your landscaping business.  Here are five tips for finding the best insurance, saving money when purchasing coverage and how best to use your policy when a disaster occurs.

Get the answers to your Lawn Care and Landscaping Insurance Questions at My Insurance Question.com

Partner with an independent agent

Independent insurance agents are unique in that they can quote you policies from many different carriers and not just one or a select few.  The appetites of the carriers change from year to year for certain coverages and especially for different industries.  Some years, your premium may go up simply because the carrier has experienced a lot of losses in your industry of the last year or couple of years. As a result they raise the prices for that classification code.  Another carrier may not have experienced the same losses and may be more hungry to quote your policy.  An independent insurance agent has the ability to force carriers to compete for your business.  In the end this helps you get better coverage at rock bottom prices.

Make sure you are in the right class code

The Lawn Care and Landscaping Industry is an industry that has numerous general liability classification codes. If you do not give enough information to your agent, they are forced to guess exactly how much risk your business takes on. It is in their best interest to always assume more risk. Assuming more risk protects the insurance agency, but may cost your business more in unnecessary premium. These mistakes usually get fixed in the end of term audit, but even when corrected you still have tied up cash in unnecessary premium throughout the year.

What coverages can I do without?

Once you have taken care of finding a good agency to partner with and you have taken the time to make sure you are classified properly, it is important to ask your agent what coverage’s does your business absolutely need and what coverage’s your business may be able to do without.  At this point it is important to remember the agent works for you.  If you are honest with the agent about how much risk you are willing to take, they should be able to give you the proper information to cover your business as you prefer.  It is important to remember that insurance agents not only interact with business owners when they are selling coverage, but also when the worst of the worst has occurred.  The agent may be offering you an extra coverage because they have interacted with a business owner in the past who had a claim occur at their business where they were not covered. Those are never easy conversations to have.  Depending upon the size and severity of the disaster having the right coverage may be the difference between your business closing the doors for a week and never opening again.

Ask for available credits and debits

The best way to find the best price on coverage is to tell your insurance agent what you value in the buying process.  Insurance agents talk with many different people from many different walks of life.  One customer may want to get through the insurance buying process as fast as possible so they can get back to running their business.  Another business owner may not mind if it takes a day and a half of their time in order to save an additional five percent.  Let the agent know early and often what you value.

What do you do when your business has a claim?

It is common for a business owner to think bad things will not happen to their business, but the most successful businesses are those who have a plan in place for when things go wrong.  Part of that plan should be having the proper insurance policy in place.  When an occurrence eventually takes place, there are several steps you as a business owner can take to speed up the process of getting your claim paid and get your business back up to normal operation.

When you do have to make an insurance claim it is important to inform both your carrier and your agency.  Do not be upset if your agency informs you to contact your carrier.  It is the job of the carrier to process the claim, not the agency.  At the same time, it is equally important to keep your agency in the loop.  In the unfortunate case the carrier is not living up to their end of the bargain, the agency can contact them on your behalf.  If you have injured workers, make sure they are going to medical facilities that are properly prepared to process the workers’ compensation system within your state.  Your carrier can help you find the proper facilities.  This can drastically limit the severity of a claim and it can allow your injured worker to get the best care quickly.  The better care they get can result in the getting back on the job quicker and with the least amount of doctors’ visits possible.  Keeping the injured worker on your side is important.  If this process runs smoothly it will make your employee happy and motivated to return to work.  It will also help your insurance carrier by limiting the amount of the claim.  THis will prevent too much damage from being done to your businesses experience modification rating.  The Experience Mod is one of the main ways carriers determine how much they will charge you for premium.

Do not be alarmed if a claim stays open for a period of time after your business has gotten over the claim.  Insurance agents do this in order to not have to open a second claim.  A second claim will also impact your experience modification rating.  The carrier does this because an injured worker may return to work and reinjure themselves.   Sometimes this can happen weeks or even months after the injured worker has returned to work.  If this causes your business to file a second claim it can have a damaging effect on your rating resulting in a higher rate on premium.

 

6 coverages every Lawn Care or Landscaping business should carry.

Lawn Care and Landscaping is a diverse industry and with that diversity comes a lot of risk. How you go about protecting your business from those risks can make all the difference in the long term success of your business. Some landscaping businesses simply mow lawns, others lay sod and plants shrubs, some even climb several feet into the air to work on trees and others grow and sell plants at one central location. No matter what type of landscaping business you are running, here are 6 coverages that every business in this industry should carry.

  • General Liability
  • Workers’ Compensation
  • Commercial Auto or Hired and Non-owned Auto
  • Inland Marine
  • Commercial Property
  • Business Owners Package

General Liability

General Liability Insurance is a policy that most every business needs. Depending upon the state and industry you operate in, it is required by law to be in business. For the lawncare and landscaping industry this coverage can prevent your business from damage that is caused to third parties by you or your employees. This can apply regardless of whether the incident occurs on your property or at the property of the customer.

Workers’ Compensation

In 48 out of 50 states workers comp is required by law. What you pay in premium will depend on your experience modification rating and the NCCI class code for your business.  Lawn care and Landscaping is an industry that has several classification codes which include: 9102, 0042, 9182, 0106, 9220, and 9016.

Commercial Auto or Hired and Non-owned Auto

Commercial Auto and Hired and Non-owned Auto Insurance are two coverages that deal with vehicles being used for business purposes. Which of these two coverages your business needs is determined by whether or not the business owns the vehicle that is being used for daily work. If you have employees using their own vehicle as a part of their job than you need Hired and Non-owned Auto Coverage. If you are leasing the vehicle for the season, than this is the coverage you need as well. If your business owns the vehicle than you need commercial auto insurance.

Inland Marine

Inland Marine Insurance Coverage is also known as equipment coverage or floaters coverage. These terms are used because this insurance is for equipment not covered by your property or auto insurance policies and it is usually equipment that is going to be in transit. If you have a trailer with several pieces of equipment that is going to be transported to several locations throughout the day than you need this type of coverage. This could also be necessary for greenhouses if they are having plants delivered to a clients location. while the products are being transported they would be covered by this policy.

Commercial Property

If you own property, no matter how big or small than you need this coverage. Without it you can put at risk everything that makes your business run. Unless you can afford to replace the property and everything inside it than you need this coverage. This policy can usually be added to  BOP for minimal cost to the business.

Business Owners Package

Most insurance carriers have what are called Business Owners Packages designed for each industry and each classification code. Through their experience with claims in each industry, each carrier has a basic recommended package of coverage they deem appropriate for each business. These packages can be adjusted based on the industry you are in and the amount of risk you as a business owner are comfortable taking. This is where the advice of an experienced insurance agent who you trust can be very valuable. An experienced agent should be able to lay down the risks and rewards of each coverage and help you to make the most informed decision possible when buying insurance for your business.

 

 

SIC Business Insurance Codes:

•   0781- Landscaping and Planning

•   0782- Lawn and Garden Services

NAICS Liability Classifications:

•   541320- Landscaper Architectural Services

•   561730- Landscape Services

Business ISO General Liability:

•   Code: 97047- Landscape Gardening

•   Code: 97050- Lawn Care Services

Common Workers Compensation Class Codes:

•   0042- Landscapers and Drivers

•   9102- Park Maintenance, Lawn Care, and Drivers

•   0106- Tree Pruning or Spraying

Lawncare & Landscaping

Lawncare and landscaping businesses are similar yet very different.

As a business owner of a lawncare or landscape company you might have had to shop for insurance. You might have had to do this to either to meet state requirements or to make sure your business is protected just in case an injury occurs to an employee. Recently I have taken many phone calls from owners of small lawncare or landscape companies that have been asked by a client, sometimes even a home owner to provide proof of work comp coverage before they are grated the job or bid. Whether you have a small or large lawncare company chances are you have had to make a call or two to obtain a work comp insurance certificate.

When going through this process have you ever wondered how your company is classified? There are two class codes that contemplate lawncare and landscaping, 9102 and 0042.  The most qualifying question to determine what class code you are in is, does your company primarily engage in maintaining already existing lawns and garden beds or is your business designing and installing landscape or flower beds. Another deciding factor is if there will be any installation of paving stones or rock beds. The class code 9102 is designated for lawncare or maintenance of existing lawns. Snow removal will also be covered under 9102 and should be discussed if there is snow removal operations in the down season of lawncare. 0042 class code is designated to design and installations of lawns and beds. Any sod laying or pavers would also fall under the 0042 class code. However both class codes do contemplate the applications of fertilizers and insecticides.

One aspect of both classes of business, that I feel I must bring up, is tree trimming. If at any time there is tree trimming the class code 0106 would need to be added to the work comp quote. Designated payroll can be added to that class or it can be added on an “if any” basis. I also must fully explain that the 0106 class code is considered high risk. It is very difficult to place with an insurance carrier.

When calling in or submitting an online quote, the first couple of questions back to you will most likely be:  How many employees not counting the owner are there and what type of lawncare are you providing? If the answer to the first question is there is only the owner, which some times is the case, that would be an owner only policy. If there is one employee or more there will need to be included a total annual payroll. At that time we would figure out how to best classify you. lawncare or landscape will find the best price and insurance carrier for your company.