By Becca Cole, Associate Account Executive
Beacon Hill recently worked on the renewal of a multi-location tank policy which was written through our office for several years without apparent issues. At renewal, the agent advised that the insured had sold the business to a new company who was taking over two of the three covered locations, and the third location would be closed. At renewal time, the expiring insured elected to purchase an Extended Reporting Period (ERP) for the closed location to provide extended reporting for previously occurring but unreported claims related to just that location. A new policy was written in the name of the new owner for the remaining two locations.
After the ERP and new policy were bound and issued, the agent requested to add several new names to the new policy―the operators of the two locations on the policy. The carrier was able to endorse the new policy to list the site operators as Additional Insureds. The entities do not own the locations or have common ownership with the actual site owner, so they could not be a Named Insured on the policy, but since they do have insurable interest in the tanks on each site, they were able to be covered.
The agent also requested to add additional entities to the expired policy in relation to the ERP. After extensive review, it became clear that these were entities who should have been listed on the policy already – site operators, the actual property owners, and other entities related to each of the sites. The agent had not been made completely familiar with the relationships between the entities or with what was being required by each entity, and may not even have been informed that there were additional entities until after the policy had expired. After clarifying to the agent that the ERP itself is not an additional policy term―it simply provides extended reporting provisions for the policy that was already in place―Beacon Hill asked the agent to determine exactly what entities needed to be covered under the expired policy and for what reasons. The carrier was willing to make an exception to their underwriting rules in order to backdate any changes that needed to be made to the policy, but in order to do so needed to know precisely who the entities were and the details of their relationships to the tanks and the policy’s Named Insured.
It is incredibly important for agents to be aware of the nuances of the accounts they write. Without knowing all of the details―for instance, the owners, operators, tenants, or other related entities for covered locations―policies may be written that don’t provide adequate coverage for the insured’s needs. While we work with carriers who do their best to meet the needs of the insureds they write coverage for, coverage can only be written for known exposures. Our underwriters rely on the information provided by our agents to write the best possible coverage for each insured. Taking the time to get to know each account and insured is essential in order to ensure that coverage is written to address all exposures.