First Year E&O Cost

[FloridaStartup]

Wondering how much the first years of E&O insurance costs for a new P&C brokerage, expected sales 1 Million expected revenue 115K. Variety of policies.

New owner has CIC and also some industry specific work.

A ballpark would be great...trying to put a budget together.

 

[ksmart]

My E&O first year was about 1200. But I estimated low on sales so that it wouldn't be expensive...Can always go up...never down.

 

[Tim Hoelle]

An E&O for $1200 for a start up is a great price and I'd be curious to know details to see how that premium was arrived at and what coverage is and isn't in the policy. For a $1 MILL limit with a $5K deduct and retro inception I'd budget closer to $2500 or $3000. You can skimp on coverage and limit - but it's your business - and that's not how you intend to run it, is it? There are not alot of carriers that will provide quality coverage to a brand new agency, so you will probably have a limited selection the first year. (that does not mean bad coverage or a weak market, so don't settle for a poor policy just to have a policy)

Again, it all depends on what you want - you really do get what you pay for in most instances. I think you may want to consider buying a quality product and spending a little more money so you have coverage if anything ever happens. Also, if and when your prospect asks you how you made YOUR decision on YOUR coverage, you can honestly say you bought the best policy you could find for the price. In fact, why wait for them to ask!?

Let me know if you have any other questions - I broker this coverage to many markets so I'm "in it" every day...