In the intensely competitive market for small business coverage, insurers have to be able to stand out from the crowd without spending a lot of time and money to do so.
Insurers who use AAIS programs as the basis of their small business policies can devote less effort to program maintenance, and focus on what they do best: marketing, underwriting, loss control, and claims.
AAIS maintains two programs for insuring small businesses, each of which provides up-to-date forms, manual rules, and rating information that are filed and approved countrywide, and supported by teams of seasoned actuarial, product development, and filings specialists.
Among the product innovations that are common to both programs are endorsements for adding claims-made employment practices and employee benefits liability coverages onto policies with occurrence-based liability triggers.
Businessowners
The AAIS Businessowners Program provides insurers with a standard industry program for insuring small businesses, offices, apartment and condominium buildings, warehouses and wholesalers, and restaurants without the expense of maintaining an independent program.
Among the innovations AAIS has introduced in Businessowners is a procedure for rating off-premises liability exposure for risks with installation, repair, or other operations away from the insured location.
Like most traditional BOPs, the AAIS Businessowners Program provides a choice between a named perils and open perils base form, each of which include built-in business income coverage, full liability coverage, and the standard range of additional coverages and coverage extensions, plus state amendatory endorsements.
Beyond that, carriers can trigger built-in commercial crime coverages by making entries in the declarations.
The program includes a multistate manual with multistate rules, classifications, and rating information, plus individual state pages that include territorial definitions, state-specific exceptions to multistate materials, and state-specific rating information.
The manual gives a choice between using pre-calculated loss costs or factor rating information to determine the basic policy premium for buildings and business personal property. The factor rating information consists of base loss costs and relativity factors that pertain to construction, protection, territory, rate group, and liability limits.
AAIS provides numerous BOP endorsements, including:
- An option to add equipment breakdown coverage;
- An endorsement package that provides additional commercial property and inland marine coverage;
- Additional liability coverage options, such as printers errors and omissions, and certain professional liability coverages.
- Options to implement functional replacement cost valuation for building property and business personal property;
- Options to implement percentage deductibles of 1%, 2%, or 5% for windstorm or hail losses, subject to a $1,000 minimum deductible; and
- An option to allow coverage for property damage liability to apply to scheduled premises rented or occupied by the named insured with the owner's permission.
Artisans
The Artisans Program provides a ready-made package policy and endorsements designed for artisan contractor accounts that primarily require liability coverage for accidents arising out of their operations, but may also need to insure building and/or business personal property exposures.
Given the unique profile of artisan contractor risks, this program allows companies to insure them for property and liability, or for liability only. Eligible risks include firms with up to 20 employees, up to $3 million in sales, or up to $500,000 in payroll.
Eligibility extends to more than 60 classes of artisan contractors, including carpenters, electricians, and plumbers, plus other occupations, such as caterers, inspectors, interior decorators, and repair services.
The Artisans Program provides open perils property coverage in the base form, along with coverage for business personal property away from insured premises and loss of income coverage. An option is available for increasing the off-premises property limit.
Several features of the Artisans forms make it easy to maintain and tailor a product for small contractor risks:
- The general aggregate limit can be applied per project, thus meeting a common requirement of general contractors.
- Broad form contractual liability coverage is built into the base form, with limited contractual liability coverage available by endorsement.
- Inland marine coverages for builders’ risk, contractors’ equipment, tools, and installation can be added by endorsement.
- Endorsements are available to limit or exclude coverage for claims arising from mold, construction defects; and synthetic stucco ("EIFS").
- “Voluntary property damage” coverage, which provides limited coverage for property damage claims, regardless of the insured’s liability, is available by endorsement.
Insurance companies seeking more information on AAIS products and services can contact Rick Maka, director of marketing and strategic alliances, at our contact form , or by calling 800-564-AAIS, ext. 222.