No Insurance

Last month, I wrote about gas prices and how they affect everyone’s business, and I told you some things you might do to save money.  I hate to be the barer of bad news, but I am going to tell you about how difficult it could be to get insurance in the future.  My wife and I are in the process of moving.  We called our insurance agent to have him get an insurance estimate on our new house.

He explained how hard it is now to get insurance, because there are fewer and fewer companies.  He is an independent agent who takes our policy request and gives it to ten different companies to get the best price.  Because insurance companies are paying more claims with larger amounts, lots of the companies are merging with bigger companies or cutting back on what they are insuring.  He told me that he would usually have 10 companies supplying a quote, but now it’s down to 3 companies.  He said car and truck insurance will be even harder in the future.

You know how hard it is to get insurance on your trucks now and the future will be worse.  I was talking to a large company, and he told me that 4 other companies got together, and each threw a million in the pot to help cover each other if only one got hit with a major claim.  Most companies are just too small to think about doing something like that.  As the price of insurance goes up there are ways to cut your costs. Here are a few ideas to think about:

1. Reducing your coverage to lower your premium.
2. If your trucks are older, you may want to drop collision and comprehensive coverage and carry liability only.
3. If you have a truck that you don’t use often, you may want to reduce coverage during slow times.
4. If you are leasing trucks, see if the lender has policies that would allow you to lower your payments.
5. If the trucks are old, just get rid of them and save money.
6. If you have money in your savings, you can lower the coverage and you pay for damages from your savings.
7. If you have a good driving record, you may not need extensive coverage.
8. You may have insurance that offers you a rental replacement.
9. Consult with an insurance professional to see if you need all the insurance that you are currently paying for.

Most companies will not turn in a claim if it’s lower than a certain amount because they know their insurance will go up the next year, or even worse they could be dropped.

I had a friend of mine that owned a large tow company and for years she never had any problems.  Then time caught up with her, and one of her drivers was in an accident.  It was bad, and she lost her insurance.  The company she used for years dropped her, and she could not find anyone that would sell her insurance.  She almost lost her business and the stress caused health issues. She finally got insurance, but you know she paid dearly for it.

My wife has a health issue she will have forever.  She was paying vary high health insurance premiums along with treatments that also cost a fortune.  She needed a replacement for her insurance until her Medicare kicked in.  She found a company out of California called Medashare where the patients would self-insure themselves.  Hundreds of participants would throw money into a pot, and if anyone had a major problem the insurance would pay for it.  She saved close to $500 a month in premium payments, and she never had to fight with them to pay a claim or worry about getting canceled.

This got me to thinking, why don’t I start an insurance company that would provide the following:

1. Low monthly premiums
2. Never worry about being canceled because you turned in a claim.
3. No long-drawn-out procedures when you do submit a claim.
4. Rebates if you go for a year without any claims.
5. No strict procedures to see if you qualify.
6. Up to 10% off what you are paying today when you register.

Imagine running your company, knowing that you will always be insured even when times are slow.  I am working with some industry experts to see what I must do to start an insurance company.  I must see if there are certain financial requirements before I bring in a customer.  I must be able to cross state lines when adding tow companies.  When I open the doors, tow companies are all I will insure.  I have associations that will help me find tow companies that need insured, and I have some other means for reaching out to tow companies to get them on board.

I would like to have this going by the 1^st quarter if possible.  I will be reaching out to you with a survey to complete.  I would like to know some of the following information:

1. How many trucks do you have?
2. Do you have any heavy-duty trucks?
3. Do you have a storage yard?
4. Approximately how much do you pay today?
5. How many claims did you turn in last year?
6. Did you have any claims over one million dollars?
7. How often do you pay your premiums?

If you think this is a good idea and it will help the industry, let me know.  If you would like to be a part of helping me set this up let me know.

I can be reached at 469-774-0340, or email me at dan@towtrax.com.

Ya’ll be safe out there!