If you’re a small-business owner who’s in the market for business insurance, you’ve probably come across (or will come across) a request for your “loss runs.” And if you’re like most of the small-business owners we’ve talked to, you’ve got no idea what that means.
Don’t worry. Read on to find out everything you need to know about loss runs so you can secure a business insurance policy that works for you.
What Are Loss Runs?
Loss runs are essentially a catalogue of your insurance claim history throughout the duration of your policy. Insurance companies keep track of them so they can see at a glance how many claims each of their clients has made and how each of those claims has turned out.
Often, when business owners apply for new insurance, their agent will ask for loss runs on their existing or former policies. Viewing loss runs is, for the insurance industry, similar to the banking industry’s practice of viewing the credit report of a potential borrower: by seeing your insurance past, insurers can get an idea of what kind of insurance risk you will be in the future.
What Information Is Included in Loss Runs?
A typical loss run details the ways you’ve used your insurance coverage since initiating your policy, including information such as…
- Your name.
- The dates of any losses you claim, and dates on which you submitted any claims.
- Details about the loss incident (e.g., a fire that damaged your office).
- The total amount of benefits paid to you to date.
- The amount of reserve funds set aside for your account.
- The status of your claim: open or closed.
How Do I Get Loss Runs?
If your insurance agent requests a loss run as part of your business insurance application process, you can obtain one fairly easily. Simply contact your insurance provider, identify your insurance policy number, and say you’d like your loss run. Be sure to indicate how many years you need the report to cover – a standard request in the industry is five years.
Email is often an efficient way to request and receive loss runs, though you may also be able to make the request by phone or via postal mail.
How Long Does It Take to Receive Loss Runs?
Depending on the situation, you might be able to receive your loss run report in as little as a few hours. Most states require insurers to provide loss runs within a set time frame (often 10 days) to prevent companies from withholding this information from customers who are requesting it as part of changing insurance providers.
If you requested your loss run information more than 10 days ago, check in with your insurance provider and take a look at laws in your state to ensure that you’re being treated fairly.
Still Have Questions about Loss Runs?
Post them below, and we’ll get you answers!