Author: Bob O'Brien

Insurance Broker or Agent – Which is Better?

Posted on by Bob O'Brien

Insurance broker or agent. Which is better? Is there even a difference between a commercial insurance broker and an independent business insurance agent?

Insurance broker or agent can help you get the best value for your insurance

Insurance Broker or Agent – the Legal Difference

Agent and broker are legal terms. They mean something different.

Independent insurance agents contract with insurance companies represent them to the public. Those contracts grant agents the authority to “bind” the insurance company to certain commitments. Agents offer efficiency, flexibility and local knowledge that big insurance companies don’t have. That benefits both the companies and the clients.

Insurance Brokers have no authority to bind insurance companies. The insurance company or its agent must approve a broker’s request to bind insurance coverage.

Duties Owed by Insurance Broker or Agent

A broker’s duty is to their client. They have to be honest with insurance companies, of course. But they have no contractual obligation to any insurance company. In theory, a broker could place their clients’ insurance with any insurer licensed to do business in their state.

An agent owes a duty both to the insurance companies and their client. Because they’re contracted directly with insurance companies, therefore they owe an extra duty to those companies in return for the authority that the companies give them.

An agent also owes duties to their client. In Maine, those duties include:

  • firstly, to act in good faith
  • secondly, to use reasonable care and diligence in serving best interest of the client
  • and finally, to carry out the client’s instructions

Sometimes an Agent is a Broker

Sometimes insurance agents use non-contracted insurance companies to get the best deal for their clients. They may even work with another agent who has a contract to represent a company that they themselves don’t. In those cases, they’re essentially acting as brokers. They have no authority to bind or commit the insurance company. And they owe no contractual duty to the insurer.

How An Insurance Broker or Agent is Paid

Both agents and brokers work on commission. Insurance companies pay a percent of the premium to the producing agent or broker. That commission may also be shared between an agent and a broker.

Some brokers also charge fees to their clients for certain services. For example, clients could hire a broker to help them improve their claim history. Some brokers also charge for transactions, for example issuing proof of insurance.

Advantages of Insurance Brokers vs. Agents

  • First, brokers represent their clients, not insurance companies. They have no contractual obligation to the insurance company.
  • Second, brokers may have access to more insurance companies than an agent. Agents often have contracts with 8-10 insurance companies. In theory, brokers can access any licensed insurer.
  • Third, brokers may provide additional services that agents cannot. For example, claims management, self-insurance or safety consulting.

Advantages of Independent Agents vs. Brokers

  • Speed and efficiency. Agents can bind coverage on behalf of insurers. That reduces the time to put coverage in force. They also know their insurance companies well. They know how to quickly get things done.
  • Insurance company influence. Insurers work closely with their agents. They trust them. They also rely on agents to bring good customers to them. Therefore, agents often have influence with insurers to advocate for their clients.
  • Local knowledge. Many agents are embedded in their communities. They know the geography, culture and customs of their area. They work with families and businesses of all sizes. Brokers tend to be larger and operate in a wider area.

A Maine Independent Agency

Do you live in Maine? Looking for a Portland area independent insurance agent? Contact a Noyes Hall & Allen agent in South Portland at 207-799-5541. We offer a choice of many of Maine’s top insurance companies. In other words, we can help you find the best fit and value for your insurance. Because we’re independent and committed to you.

Professional Liability Insurance vs. General Liability in Maine – What’s the Difference?

Posted on by Bob O'Brien

Professional liability insurance and general liability insurance are different. Maine businesses and non-profits may need both. What’s the difference between professional liability insurance and general liability insurance?

Professional liability insurance protects consultants, creatives and more.

What is General Liability Insurance?

GL insurance protects your business’ assets against four types of lawsuits:

  • firstly, Bodily Injury caused by your actions, or that happen on your premises. For example, slips and falls in a parking lot, or a contractor dropping a hammer from a scaffolding, injuring someone.
  • secondly, Property Damage  that you cause to the property of others. For example, your crew knocks over a valuable vase while cleaning someone’s home.
  • thirdly, Personal Injury, such as slander, libel or invasion of privacy. For instance, a realtor walks into an occupied apartment without warning.
  • and finally, Products and Completed Operations Liability – in case your product or work harms someone or their property. An example: a diner gets food poisoning after eating in your restaurant, or your roofing job fails, causing water damage at someone’s house.

Moreover, general liability insurance pays your legal defense costs against these types of suits – even if you did nothing wrong!

What is Professional Liability Insurance?

Professional liability insurance, sometimes called E&O insurance, protects against claims of:

  • Negligence – for example, a real estate agent fails to disclose a defect in a property, or a planning consultant who misses an important regulation, causing their client to incur large penalties.
  • Improper or Inadequate work – for instance, copyright infringement, improper design, or a clerical error that costs your client money.

Like general liability, professional liability insurance also pays legal defense costs.

Do I Need E&O Insurance?

Professional liability is a hazard in almost any profession. Some of the most common ones include:

  • Architects and engineers
  • Accountants, attorneys and bookkeepers
  • Beauticians, tattoo parlors and other personal service providers
  • Condominium and non-profit boards
  • Consultants and coaches
  • IT professionals
  • Marketers, creatives, drafters and designers
  • Medical and health care professionals
  • Real estate and property managers

Professional Liability Insurance Questions?

If you have Maine professional liability insurance questions, contact a Noyes Hall & Allen agent for prompt, professional answers. We offer a choice of many of Maines top business insurers. We also have access to dozens of specialty insurers. In other words, we can help you find the best fit and value for your insurance. Because we’re independent and committed to you.

Water and Sewer Backup Insurance – What is It, and Do I Need It?

Posted on by Bob O'Brien

Water and sewer backup insurance coverage isn’t included in off-the-shelf homeowners or business policies. But backup of water is a very common cause of property damage in Maine. Therefore, we’re lucky that optional coverage is available and easy to buy.

water and sewer backup insurance can help with cleanup and repair

What is Water and Sewer Backup?

Water and sewer backup insurance covers backup from a sewer, drain or sump. Remember, it’s not covered by standard home or business insurance. In Maine, water backup is commonly caused by high groundwater level or a plumbing blockage or malfunction. For instance:

  • A sump pump fails, causing water to flood a basement
  • A check valve malfunctions, causing a backup of sewer or water
  • A sewer drain clogs, backing up wastewater

What Does Water and Sewer Backup Insurance Cover?

Coverage can be thought of in steps:

  • firstly, removal of water or sewage
  • secondly, drying and disinfecting
  • then, cleanup of waste or debris
  • finally, repair or replacement of damaged property

What’s Excluded?

Leakage or seepage through a foundation or slab isn’t considered water backup. Moreover, it’s not covered by any insurance form.

Leaking from plumbing or heating systems is often covered by homeowners or business policies. So it’s not included in water backup coverage.

How Much Does Water and Sewer Backup Insurance Cost?

Water backup insurance usually has a separate coverage limit. The minimum amount is often $5,000. Most companies’ offerings max out at $25,000. Cost varies by insurer and coverage limit. Prices start around $50 per year, and can be as high as $250. Business insurance policies are different. So check with your agent about coverage for your business.

How do I Choose a Water and Sewer Backup Coverage Limit?

First evaluate your exposure. How much damage would inches of water cause? For instance, do you have finished space in the lower level of your home? Do you store anything damageable there? Moreover, cleaning, drying and disinfecting often costs $5,000 or more. And that’s before repairing or replacing any damage. The average water damage claim is more than $11,000.

I Don’t Have a Sump Pump. Do I Need Water and Sewer Backup Insurance?

You can still suffer water backup without a sump, because water can back up from any drain or sewer in the lowest level of your home. However, if you have none of these, you probably don’t need water backup coverage.

I Have City Sewer and Water. Do I need Water and Sewer Backup Coverage?

Backup can occur from public utilities, private wells or septic systems. Above all, it matters whether you have a sewer, drain or sump, not what kind of services you have.

Need Help? Ask an Agent

In conclusion, water and sewer backup coverage can be an important addition to your insurance.

Do you live in Maine? Have questions about water and sewer backup insurance? Contact a Noyes Hall & Allen agent in South Portland at 207-799-5541. We offer a choice of many of Maine’s top insurance companies. In other words, we can help you find the best fit and value for your insurance. Because we’re independent and committed to you.

What is General Liability Insurance?

Posted on by Bob O'Brien

General liability insurance is important for Maine businesses. If you operate a business in Maine, customers or the town may demand a certificate of insurance. This proves that you have general liability coverage. Some people think about liability insurance when they first start their business. However, others don’t think of it until someone asks for proof.

General liability insurance protects you from a lawsuit that can destroy your assets

What Does General Liability Insurance Do?

GL insurance protects your business’ assets against lawsuits in four ways:

  • Firstly, Bodily Injury caused by your actions, or that happen on your premises.
  • Secondly, Property Damage  that you cause to the property of others.
  • Thirdly, Personal Injury, such as slander, libel or invasion of privacy.
  • and finally, Products and Completed Operations Liability – in case your product or work harms someone or their property.

 How Much Business Liability Insurance Do I Need?

Liability insurance protects your assets. Therefore, you should at least carry enough to protect the net worth of your business. Moreover, you may also need a certain limit of liability coverage to work for a certain client. For example, a $1 million per-occurrence limit is common. Higher limits are available, as are commercial umbrella policies, which provide even higher limits.

What General Liability Insurance Does NOT Protect Against

  • Professional Liability, such as improper design, malpractice, errors or omissions. You need separate Maine professional liability insurance to get this coverage.
  • Employment Practices Liability. This covers several HR-related perils. For example, wrongful termination, sexual harassment or employee benefits liability. You should purchase Maine Workers’ Compensation Insurance if you have these exposures.
  • Auto Liability. You should purchase  Maine commercial vehicle insurance if your company owns vehicles. Even if your company owns no vehicles, you should add Hired and Non-Owned Auto Liability coverage to your GL policy.
  • Pollution Liability. If your business uses pollutants, you should purchase separate insurance for this.

How Much does General Liability Insurance Cost?

Rates vary, starting at a few hundred dollars a year. Yours will depend on many factors, including:

  • Type of business or operation;
  • Your revenues or payroll;
  • How long you have been in operation;
  • Personal qualifications and licenses;
  • Prior claims;
  • Whether you combine your business property insurance with your GL coverage.

Business Liability Insurance Questions?

Do you have Maine business liability insurance questions? Contact a Noyes Hall & Allen agent in South Portland at 207-799-5541 for prompt, professional answers. We offer a choice of many of Maines top business insurers. We also have access to dozens of specialty insurers. In other words, we can help you find the right fit for your organization and budget. Because we’re independent and committed to you.

Business Insurance Inspection in Maine: What to Expect

Posted on by Bob O'Brien

Business insurance inspection is common in Maine. Commercial insurance companies routinely inspect businesses that they protect. Inspections allow them to make sure that they insure businesses that fit their guidelines and that their policyholders are adequately protected.

Is a Business Insurance Inspection Mandatory?

Inspections are expensive for insurance companies. They only perform them when they feel it’s necessary. Often, one of three conditions can cause an underwriter to order an inspection on your business:

  • You recently switched insurance to a new company. The new company wants to make sure that your business meets their underwriting requirements.
  • You recently had a claim. The insurance company may want to make sure that you have repaired any property damage or addressed the cause of a liability or workers comp claim.
  • Your business has expanded or moved. Businesses change, and so do their exposures to loss. Insurance companies inspect periodically to keep up.
  • The insurance company hasn’t inspected in several years. Things can change, even if your business stays about the same size and in the same place. The insurance company wants to make sure that your policy stays up to date in case they have to pay a claim.

inspectorCan I Opt Out of a Business Insurance Inspection?

Every insurance policy is a contract. Each policy has an “inspection clause”, which gives the insurance company the right to inspect your business with reasonable advance notice. If you refuse, it’s a violation of the contract. The insurance company can cancel your business insurance as a result.

Does the Insurance Inspector Need to Get Inside my Business?

Almost always. There are two types of insurance inspections: exterior only; and interior/exterior. The company underwriter decides which report to order based upon what they insure, your claim history, and other factors. Unless your property is a rented apartment building, the inspector will probably want to see all the areas.

What Does an Inspector Look For?

Insurance Inspector Should

Some inspectors are employees of the insurance company, but many are independent contractors. During a routine inspection, the inspector looks for features of your property or operation that can affect insurance claims. Items they typically inspect include:

  • Condition of roof, plumbing, electrical, HVAC and similar systems.
  • General property condition, paying particular notice to maintenance and general housekeeping.
  • Special hazards such as commercial cooking, chemicals, pollutants and machinery.
  • Controls and PPE to protect workers.
  • Dimensions of structures, so they can estimate the cost to rebuild them.

What Happens During a Business Insurance Inspection?

The inspector sends their report to the insurance company underwriter. If no deficiencies are noted, you will probably not hear from anyone. If the underwriter has concerns, they will ask you to address them. It’s important to pay attention and respond to these. Failing to do so can cause insurance price increases, or even policy cancellation.

If you have a question about Greater Portland Maine business insurance,  contact a Noyes Hall & Allen agent in South Portland at 207-799-5541. We offer you a choice of Maine’s preferred property insurance companies. We’re independent and committed to you.

Non-Admitted Insurance in Maine

Posted on by Bob O'Brien

“Non-admitted” insurance companies are not approved by the Maine Bureau of Insurance. But they play an important role in Maine’s insurance market. Non-admitted carriers are often called “surplus lines” or “excess lines” insurers. They take higher risks than admitted insurers. That comes at a cost. Here are the pros and cons of the non-admitted insurance market.

non-admitted insurance companies provide a valuable service, with some risk.

The Risk of Non-Admitted Insurance

  • Non-admitted insurance companies’ coverage forms are not approved by Maine regulators. Their customers don’t enjoy many of the Maine Insurance Code’s protections. But they are subject to federal regulation through the Dodd-Frank Act (.pdf, 800+ pages).
  • In case of insurer insolvency, the Maine Guarantee Fund does not apply. Even if a policy is active, claims might not be paid if the company goes bankrupt.
  • The Maine Bureau of Insurance doesn’t review or approve non-admitted insurance rates. They do with admitted insurers. Non-admitted insurers may charge what the market will bear.
  • Many non-admitted insurance policies have a “minimum earned premium” of 25% of the annual premium. Even if you cancel your policy right away, the insurer will keep 3 months’ premium.
  • Non-admitted insurers may add separate policy fees to premium. Those are usually non-refundable. They must add Maine surplus lines tax to the premium, too.

Non-admitted insurance is often more expensive and provides less coverage. That’s why Maine only allows non-admitted carriers to insure risks that admitted carriers refuse.

Non-Admitted Insurance Can be Valuable

Purchasing insurance from a non-admitted carrier isn’t ideal. But it is a valuable service.

  • Some protection is better than none. While non-admitted insurance coverage is restrictive, it can protect customers against catastrophe.
  • Non-admitted coverage can be a temporary solution. It can give you time to make improvements and qualify for insurance from an admitted insurer.
  • Most lenders will accept non-admitted policies as proof of insurance. Lenders require insurance from their borrowers in order to make a loan.

Be a Smart Insurance Consumer

Purchasing insurance from a non-admitted carrier can be risky. Since non-admitted insurers are not covered by the Maine Guaranty Fund, it’s important to research your insurer’s financial strength. But many non-admitted insurers have excellent A.M. Best financial ratings (.pdf). Ask your agent about yours.

Non-admitted insurance proposals list all applicable exclusions, warrantees and coverage forms. You should at least understand them, even if you can’t change them. Your agent should be able to explain them to you. If you’re a client, your Noyes Hall & Allen Insurance agent can answer questions about your insurance. We’re independent and committed to you.

Increasing Construction Costs – Do I Have Enough Home Insurance?

Posted on by Bob O'Brien

Increasing construction costs may mean you don’t have enough insurance. Building costs are very high now. The 2020 pandemic caused material supply shortages. Meanwhile, many people wanted to improve the homes where they were spending so much time. The increased demand and supply shortages caused increased building material costs.

Increasing Construction Costs in Maine

Construction costs have two components: labor and materials. Both factors have increased during COVID. Contractors have been very busy. That drove up labor costs. Material shortages and supply chain interruptions pushed material costs higher, too. There’s no doubt that it would cost more to rebuild your home if a disaster struck this year.

My Home’s Worth More than It’s Insured For

Your insurance amount is almost never your home’s market value. Real estate values include acreage, desirability of location, landscaping, hardscape and excavation. These don’t affect the cost to rebuild your home. Your insurance amount should cover reconstruction costs, and no more.

How Do Insurance Companies Set the Value of My Home?

Insurers and agents use software to estimate the cost to rebuild your home. The largest vendor of this software is MSB, now owned by CoreLogic. Using MSB, agents input your home’s dimensions and features to calculate the rebuilding cost. This software isn’t perfect. Neither are agents. The program uses historical building data. In a fast-changing market, past data can differ from actual current costs. If an agent enters incorrect information, the result can be wrong, too.

Almost every homeowners policy has a built-in inflation guard factor. Many insurers change these every year in response to current cost changes. Others increase by a flat percentage each year – often 4%.

These adjustments help cushion against inflation but they aren’t perfect. It’s a good idea to ask your agent to do a fresh MSB estimate every few years.

How Can My Insurance Adjust to Increasing Construction Costs?

Building costs rise and fall with supply and demand. They can spike after a disaster and drop when contractors are looking for work. It would be a pain to calibrate your insurance coverage every time the market changes. Insurance companies know this. That’s why they build extra coverage into many policies.

  • increasing building costs can be affected by lumber commodities pricing
    Lumber Commodities Price History – NASDAQ

Look for something called “specified additional amount of insurance.” A common additional amount is 25%. That means that your policy has up to 25% more building coverage than the limit shown on the front page. This insulates you from cost spikes and estimating errors that could leave you without enough insurance to rebuild.

Concerned About Your Insurance?

If you live in Southern Maine, contact a Noyes Hall & Allen Insurance agent in South Portland. We offer a choice of several of Maine’s top insurance companies. We can help you find the proper coverage for your home and your budget.

Looking for new home insurance, but not ready to talk to a human yet? Get up to 5 Maine insurance quotes online here.

We’re independent and committed to you.

3 Tips for Buying Portland Maine Business Insurance

Posted on by Bob O'Brien
Portland Maine business insurance doesn't have to be complicated

Buying Portland Maine business insurance doesn’t have to be complicated. If you own a business, it’s important to protect your asset with commercial insurance. These policies can protect your building and vehicles against liability, theft, fire and more.

Whether you just started a business or need to upgrade your existing commercial insurance, the team at Noyes Hall & Allen Insurance has put together this short list to help you get started. 

1. Find a Reputable Business Insurance Agent

Working with a friendly and reputable local insurance agent takes the hassle out of buying a new commercial insurance. They will ask you some questions to get a better understanding of what coverage you need.

Many Maine people prefer to do business locally. A good local agent knows the area, and what Maine’s unique hazards and opportunities. They can help you compare quotes, understand your coverage and bundle your policies. Check their online reviews to help you choose. 

2. Compare Several Quotes

It’s smart to compare three or more quotes during the commercial insurance buying process to find the right one. Go over each in detail with your reputable agent, asking questions for clarification as needed. Policies will differ on price and coverage so be sure to understand what you’re getting and for what price.

Fortunately, Noyes Hall & Allen Insurance offers a choice of 10 of Maine’s top business insurance companies. That means we can do the shopping and comparison for you, with one stop. 

3. Bundle Your Business Insurance Policies

If you need more than one type of insurance, consider bundling with one insurance company. For example, insuring your business vehicles and your property with the same company can simplify billing and save on your premiums.  

Own a Portland Maine Area Business?

Have insurance questions? Contact a Noyes Hall & Allen Insurance agent in South Portland at 207-799-5541. We offer a choice of  many insurance companies and have served the local business community for almost 90 years. We’re independent and committed to you. 

Does Car Insurance Include Roadside Assistance?

Posted on by Bob O'Brien

Does car insurance include roadside assistance in Maine? It’s a common question.

Off the shelf auto insurance policies do not include roadside assistance. But many insurance companies offer it as an option. Others offer towing coverage. Both are less expensive that auto club options.

roadside assistance is not automatic coverage in most auto insurance policies

Are Roadside Assistance and Towing Insurance the Same?

Insurance companies have offered towing coverage for years. Roadside assistance is newer. They’re not exactly the same thing.

Roadside assistance and towing cover many of the same things. Examples are: flat tire repair; jump starting; fuel delivery; and towing, of course. The difference is that towing coverage reimburses you after the service call. You have to arrange your own service provide. Coverage is limited to a flat dollar amount, often $75.

Roadside assistance is a service. You don’t usually pay at the scene. If you need assistance, you call a special number and provide your policy info. Some insurers have their own app that you can use to summon help. They dispatch a truck to come and help you. Some roadside plans have a dollar limit per disablement. Most use a towing distance limit – often 25 miles.

How Much Does Roadside Assistance Cost on an Auto Insurance Policy?

Each insurance company sets its own rates. In Maine, expect to pay between $10 and $20 per vehicle per year for roadside assistance. Towing coverage usually costs less than $10 per vehicle for a $75 limit.

Do You Need Roadside Assistance or Towing Coverage if You Have AAA or Onstar?

Most people choose not to have both. They either buy roadside assistance on their auto insurance, or another road service.

Some clients choose to buy towing insurance even though they have another service. For example, some subscription plans charge extra to tow more than 25 miles. If that happens, they pay the excess and submit the bill to their insurance under towing coverage.

Answers to Maine Auto Insurance Questions

Live in southern Maine? Have questions about roadside assistance or auto insurance? Call a Noyes Hall & Allen agent in South Portland at 207-799-5541. We offer a choice of many of Maine’s most popular insurance companies. Many of them offer optional roadside assistance coverage. We’ll help you find a solution that fits your needs and budget. We’re independent and committed to you.

My Insurance Payment is Late – and It’s Not My Fault!

Posted on by Bob O'Brien

How to Avoid Mail Delays and Policy Cancellation

“My insurance payment is late, and it’s not my fault!” It’s happening to a lot of people and businesses right now. You don’t get a bill, or it arrives late. You mail the payment to the insurance company, and it isn’t recorded for days. Between COVID era workarounds and USPS issues, insurance billing and payment processing is more unreliable than ever. But it’s still important.

My insurance payment is late! It may not be your fault, but it's still a problem.

On Time Insurance Payment is Critical

If you pay a credit card bill late, you get a late fee. But if your insurance company doesn’t get paid, you might have no insurance. That’s why it’s critical to make your insurance payments on time.

What if the delay is not your fault? You didn’t get a bill. Or you mailed the payment days ago, but the insurance company hasn’t recorded it. It may not matter. Your insurance can still be canceled if your payment is late, no matter the reason.

If your policy cancels, two bad things happen. First, you have no insurance. Second, you’ll pay more for insurance when you need to re-start coverage. So it’s very important to make sure your policy stays active.

Ways to Make Sure Your Insurance Payment is on Time

Businesses and people are finding ways to make sure their insurance payments are on time. Maybe one of these options will work for you:

  • Electronic billing – Sign up to have your bills emailed. That avoids delays in getting insurance bills.
  • Insurance company accounts – Register for an account with your insurance company. Connect via mobile app or computer. These give you access to proof of insurance, and payment and billing info. You can even file and track a claim online through your account.
  • Pay online – Most insurance companies have a way to pay your bill instantly online. You can pay by credit card, debit card or automatic bank account withdrawal. Noyes Hall & Allen clients can find their insurance company here to pay an insurance bill online.
  • Automatic Payments (EFT) – Allow the insurance company to withdraw payments directly from your bank account. This ensures that your policy payments are always up to date.
  • AVOID Bill Pay Services – Many banks offer online bill payment services. These don’t work well with insurance bills. They don’t include your payment slip, and must be manually processed. Also, you may have more than one policy. Without the ticket, the insurance company doesn’t know which one you’re paying.
  • Double check the insurance company’s address – Many insurance companies use payment processing services. These can be thousands of miles from the insurance company office. If you mail your payment to the insurance company, they will forward it to the payment service. This causes delays in recording payments.

Answers to Maine Insurance Billing Questions

If you have an app and an online account with your insurance company, you can answer simple billing questions yourself. But sometimes it’s hard to understand what you owe or why. That’s when an agent can help. They can explain and clarify your insurance billing. Many can even take a payment over the phone if you’re ready to pay.

Southern Maine families and businesses have trusted Noyes Hall & Allen Insurance agents for more than 80 years. We can help you set up a company account or payment schedule. We can explain your bill, or even take your payment if you’re in a rush. We offer a choice of many insurance companies and billing plans. We’re independent and committed to you.