Just got my renewal notice and my E&O premium jumped from $2,200 to $3,800 for the same $2M coverage. Carrier says it's market-wide increases due to more claims in professional services. Anyone else getting hit with these crazy increases? Starting to wonder if I need to shop around or if everyone's raising rates. I'm in Connecticut doing mostly Eversource and UI work.
E&O rates going through the roof - anyone else seeing this?
Gina, I'm seeing the same thing up here in Washington. My premium went from $1,500 to $2,700 for $1M coverage. Broker says professional liability is a hard market right now across all industries. PSE and Avista both require minimum coverage so I don't have much choice but to pay it. Looking at raising my audit fees to cover the increase.
Same here in Idaho. Rocky Mountain Power requires E&O for their approved vendor list and my renewal just doubled. Broker suggested increasing my deductible from $1K to $5K to bring the premium down but I'm not sure that's worth the risk. Anyone tried going with a higher deductible to manage costs?
Pete, I went from $2K to $10K deductible last year and it saved me about $800 on premium. Haven't had to use it yet so hard to say if it was smart. The way I figure it, if I have a claim big enough to need insurance, what's an extra $8K compared to potentially hundreds of thousands in damages? SCE requires $2M minimum for their large commercial audits.
This is brutal for those of us just starting out. I'm looking at $4,200 for basic $1M coverage here in Texas with no claims history. That's a significant chunk of revenue when you're building a client base. Oncor requires proof of E&O for their demand response audits so I don't have a choice. Might have to pass these costs through to clients.
Howard, $4,200 for new coverage is insane. I remember when I started 15 years ago it was under $1,000 for $1M. The insurance companies are definitely taking advantage of the fact that we need this coverage to work with most utilities. Has anyone tried self-insurance or captive arrangements?
Gina, I looked into self-insurance but you need serious capital reserves. Most utilities won't accept it anyway - they want to see a rated insurance carrier. I think we're stuck paying these premiums unless the market softens. At least we can write it off as a business expense.
This is definitely a hot topic right now. I've been seeing the same increases across the board. The key is shopping multiple carriers and working with brokers who understand our industry. Some carriers are more aggressive on pricing than others. I'd also suggest joining professional associations if you haven't - sometimes you can get group rates that are better than individual policies. MLGW has been understanding when contractors explain the insurance cost increases.