The Hartford is offering its auto insureds the option of locking in their auto insurance rates for a full year. In conjunction with this annual auto option, the company will offer a new eight-payment option. Currently a four-payment option is the most popular payment option for the six-month auto policy.
Among the other features of Hartford's auto policies are:
* 24-hour a day, 365 days a year claims service;
* Lifetime repair guarantee (for as long as the insured owns the car) for approved repairs done by one of The Hartford's approved repair shops;
* RESCUE 1-800, which provides repair, towing or unlocking service;
* Quick auto glass repair/replacement service from one of the 4,500 shops approved by The Hartford;
* A replacement vehicle of equal value, with no deductible for depreciation, for any new vehicle that is totaled within the first 180 days of ownership or 7,500 miles of driving, whichever comes first.
Personal watercraft rates reduced
The Recreational Products Insurance (RPI) division of Universal Underwriters Insurance Company reduced its personal watercraft insurance rates by as much as 30% and liberalized its underwriting requirements. The company now has no limits on the length, value or cc size of the personal watercraft unit.
RPI permits two units to be written on one application, and has increased limits for both personal watercraft and jet boats.
In addition to regular commissions, which are at least as high as homeowners commissions, RPI offers contingency bonuses on personal watercraft business which are as high as 4%, according to RPI National Marketing Manager Joe Musashe.
Rockwood reduces EPLI premiums
Rockwood Programs reduced the minimum premium for its employment practices liability insurance (EPLI) program from $1,650 to $1,100. For firms with 75 or fewer employees Rockwood also modified its EPLI rating structure to provide more favorable terms and include a no coinsurance provision and an increased credit for higher deductibles.
The claims-made policy, underwritten by member companies of Gulf Insurance Group, specifically covers wrongful termination, sexual harassment and discrimination. It is available to employer groups with 6 to 1,000 employees, except for financial institutions and temporary agencies.
Rockwood's program is sold through independent agents, with agents receiving a 10% commission on accepted business.
Further information is available from Rockwood: (302) 765-6000. Agents can access numerous sales aids by calling the company's Fax on Demand system: 1-888-SEL-EPLI (735-3754).
Hartford offers program for wholesale greenhouses
The Hartford introduced a greenhouse growers program to be offered through a Washington state-based program administrator. The "Green Guardian" program is designed for wholesale greenhouse growers with a minimum of $500,000 in sales.
The program provides property, commercial auto, workers compensation, crime, general liability, inland marine and umbrella coverages. It includes coverage for crops and greenhouses as well as time element coverages.
Repair costs for mechanical or electrical breakdown of equipment are covered, as is damage to crops caused by the breakdown of equipment.
It covers greenhouses constructed of tempered safety glass, pressurized double-layered polyethylene, fiberglass, acrylic or polycarbonate.
The Green Guardian program is open to all agents through Cascade Pacific Corp. of Everett, Washington, which has specialized in the horticulture industry for 20 years. It is expected to be available in more than 30 states by the end of this summer.
More information is available from Ralph Penton of Cascade Pacific: 888-626-7596.
AAIS offers endorsements for "Year 2000" problem
The American Association of Insurance Services (AAIS) introduced two endorsements dealing with the "Year 2000" (Y2K) problem, one excluding coverage and the other providing coverage for extra expenses dealing with Y2K.
AAIS has included the endorsements as part of the electronic data processing (EDP) section of its Inland Marine Guide, which covers more than 40 nonfiled inland marine classes.
The Year 2000 Exclusion Endorsement excludes coverage for losses resulting from "two-digit coding of four-digit calendar year dates." The endorsement is simply "an additional safeguard," according to Robert Guevara, AAIS assistant vice president for inland marine. "Flaws or shortcomings in the design of computer programs should not be considered fortuitous events," he points out.
Experts predict that many businesses will seek compensation from their insurers to recover losses caused by older computer coding that recorded only the last two digits of a year. Widespread problems can result if programming that cannot distinguish between 1900 and 2000 is not corrected.
"Given the scope of the Year 2000 problem and the immense cost to fix it, we have to anticipate that some insureds will aggressively seek coverage where none was ever intended," Guevara said.
The Year 2000 Coverage Endorsement offers coverage for extra expenses incurred to "correct or remove a 'year 2000 disturbance' from any hardware, software, or program." A "year 2000 disturbance" is defined as the "disruption of covered property caused by two-digit coding of four-digit calendar year dates" that prevents any hardware, software, or program from being able to recognize, distinguish, or interpret any date on or after Jan. 1, 2000.
The Year 2000 Coverage Endorsement carries a separate coverage limit and deductible amount from the underlying EDP coverage. In the event of a loss, the endorsement states that the insurer will pay the lesser of:
* All expenses related to a year 2000 "disturbance";
* The reasonable cost to correct or replace the cause of a year 2000 disturbance; or
* The coverage limit.
Although not stated in the endorsement, the underwriting information that accompanies it recommends that the Year 2000 Coverage Endorsement be used only for insureds that have already "swept" their computer systems for Year 2000 coding problems. When underwriting the coverage, says Guevara, insurers should insist that an insured be able to produce:
* A comprehensive inventory of systems and programs;
* An assessment of how each system and program is affected by calculations involving the Year 2000;
* Indications of which codes have been modified or replaced; and
* Results of system tests, including simulated transactions, performed after reprogramming is complete.
"The coverage is for costs that arise after an insured discovers that some old coding was missed when the programmers swept the system to make it Year 2000 compliant," says Guevara. "It is not intended to be a substitute for doing a thorough review and correction of systems prior to Jan. 1, 2000." He adds that underwriters need to determine that insureds are making good faith conversion efforts and that they are not relying on the coverage to make up for inadequate funding of the conversion process.
Guevara notes that the Year 2000 Coverage Endorsement is not intended to compete with the extensive property and liability coverage that brokerage firms are marketing to address the "Year 2000" problem. It does, however, provide property/casualty companies with a standard form to write limited property coverage for accounts that might otherwise have to turn to the brokers.
Insurers interested in affiliating with AAIS for use of materials in the Inland Marine Guide can call Robert Schnoll, marketing manager, at 800-564-AAIS.*
©COPYRIGHT: The Rough Notes Magazine, 1997