by John Sterns
The importance of having sufficient liability coverage has never been greater for businesses. Even relatively small incidents can exceed standard indemnity limits and result in large claims that can have a catastrophic impact on a company’s balance sheet and reputation. Consequently, there is a growing demand for higher limits of insurance. Here are five reasons brokers should consider excess of loss coverage for their clients.
With advances in medical science, longer life expectancies and increasing care costs, the likelihood of individual claims exceeding $10 million is at an all-time high.
Companies that carry out work for local authorities, property owners or main contractors are often contractually required to hold $5 million+ indemnity limits. Excess of loss enables businesses to increase their coverage with an annual policy or on a project-specific basis.
Companies with large numbers of employees or visitors in the same building face the possibility of a single event causing injuries to multiple people. The resulting claims can quickly accumulate to exceed traditional primary limits.
Many of the largest public liability claims result from fires caused by companies using heat at third-party sites. It’s essential to ensure that public liability indemnity limits cover damage to third-party property as well as any business interruption suffered by the customer.
It can be difficult to quantify the claim potential of a product, especially when that product is a component. Brokers and their clients need to consider the end usage of their products, the potential for product failure to result in injury or damage, and whether there are exports to the United States, where claim values can be much higher.
A blog created for Canada. Reference: Justin Godman
Taking it to excess. [Blog Post].
DISCLAIMER
One or more of the CNA companies provide the products and/or services described. The information is intended to present a general overview for illustrative purposes only. Read CNA’s General Disclaimer.
To access all other 2021 blogs:
https://www.cnacanada.ca/web/guest/cnacanada/about/listofauthors
John is responsible for leading the casualty and international business for CNA Canada’s underwriting department and is charged with aligning branch structure with CNA’s strategy to drive profitable growth. He joined CNA Canada on May 1, 2017, as VP casualty after a brief stint at retirement. John has extensive knowledge in risk management and international casualty programs.
John has more than 37 years of experience in the insurance business and 30 years underwriting casualty. Prior to joining CNA, John held senior positions with AIG, Home and Chubb. John holds a bachelor’s degree in Environmental Studies (Geography) from the University of Waterloo. John is also an active member and director for Erin Mills Church campus and Three Lakes Cottage Association.
