Someone Needs to School Me! on CPP

[iiinycboi]

Ok i got a small size supermarket grocery account.

I've looking over coverages and i saw some things i might not be understanding correctly!

For the liability section, list of hazards, it shows exposure 300,000 and (S)

this is annual sales right? so the previous policy states 300k gross. But i am sure they are doing 300k gross per month. I work directly with their accountant. Now i dont know if this will be audit at the end of the year and they will OWE money? (tower btw not sure if they audit their cpp)

Also the size of the store is 4000 sqft, is there a choice of being rated on annual sales or the size of the location?

They are currently paying 2800 for the exposure at 7.2 rating, if i change to new CORRECT exposure, we're looking at one more zero and im sure im losing this account. (unless i am understanding the exposure wrong)

What to do?

 

[rousemark]

Call the carrier............

 

[iiinycboi]

oh btw, this is a BOR account but i want to remarket them but i know the price will be super high, compared to their current coverage

 

[djs]

In that case, its a matter of explaining to them that the reason they BOR'd to you was so you could take care of them. Once you had a chance to really look at the policy, you realized that there is a potential problem...... this is what they hired you for.

Check with the carrier though, make sure it is a problem. So many carriers rate things so many different ways its sometimes hard to know without asking.

Dan

 

[Tucker444]

Generally CPP's are audited.

I wouldn't think they would show just the monthly sales on the policy. So you are most likely correct that an audit will pick it up.

Tower may have cut a deal and is choosing not to audit. Even if they don't they would still be rating it based on sales and yearly sales not monthly.

Tower...well, who knows about them. Never had a carrier that gets so many things wrong. So no telling what an Underwriter did.

 

[NCAgent]

There are times that I tell a client that I cannot match what another company did. *somehow* the client got away with something I cannot do, such as their current insurance agent finding a lower PC code than me or not rating for some tickets or accidents.

What can ya do? You warn the client something seems fishy but you will offer things to them legitimately and the client won't risk a nasty surprise/revision in the future. If tower is messing up then you can either move them before it becomes a problem or keep the policy with them until they find out what happened (if at all, they might not even care since it is on the books.) This is, of course, assuming they did screw up.

Perhaps you might want to verify with a Tower underwriter PERIOD? Maybe they just have an odd way of listing things...

 

[iiinycboi]

Yeah, this one is tough for me. The previous broker basically didn't do anything for them and consistently neglected their policy. They called him to file a worker comp claim, but after 3 months the broker still didn't file it.

The previous broker is also away on vacation, i tried reaching him for information on the policy. He didn't give the supermarket any policy info, etc... only a invoice every quarter for money.

So now i come in and i call the carrier to take the policy info etc... I'm finding all these problems. I want to call tower and ask them about this specific policy, but i think that might trigger a flag and have them review thier policy?

I do see that the audit period is (none) but i thought all CPP audits every year.

I'm going to try to explain it to them, but i got a very strong feeling they are going to go, "what?! X amt of increase blah blah, leave it the way it is," Then i think they will go shopping around and ditch me once they find another guy willing to bend the rules for them

oh the joy of meeting people of all personalities.
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Oh they are also part of a supermarket association! If i can fix this i can get all the supermarkets in the association and thats about 15 more accounts, so i dont want to lose it!

 

[VolAgent]

What is your responsibility/liability if this policy stays at your agency and it really is messed up and Tower has no clue about it?

 

[iiinycboi]

now i got a question that this topic sparked up. If they company doesnt do sales audit, at claim time, do they audit you and decline claim, or audit you and subtract the difference in premium you "owe"

What is the actual "punishment" insurance carriers do when it comes to this situation?

 

[NCAgent]

now i got a question that this topic sparked up. If they company doesnt do sales audit, at claim time, do they audit you and decline claim, or audit you and subtract the difference in premium you "owe"

What is the actual "punishment" insurance carriers do when it comes to this situation?

I would imagine it would be similar to the life insurance companies. If you gave them wrong information and they find out about it then they change the policy to match what it would have been with the correct information. Though that is my guess, but it sounds legit