Why is insurance asking for yearly revenue??

My guess would be more miles and income = more risk on there part .just like auto insurance u claim how many miles a year u drive it

 

I have heard of policies that are based on yearly revenue. You pay a percentage of your yearly gross for the policy. Could possibly be checking to see if you are hauling cheap freight. The cheaper the freight, the less money available for safety / maintenance. That's all I can help.

 

That's a good question. Would like to know why myself.

 

Maybe it's like the credit check. They want to see that you will have money to pay them monthly.

 

Your CGL (commercial general liability) premium is based on revenue (ability to pay for premium and deductibles), class of business (general risk) and loss history (self explanatory). Miles are often asked b/c many of the standard Accord Form Applications have that as a "mandatory" field in the software b/c that form is also used for physical damage and your commercial trucking auto liability. Mileage does factor in PD and CTAL because those risks go up the more miles you put in (increased exposure), but CGL doesn't cover anything while rolling so to speak. It's to cover accidents that the other policies don't cover that may happen while at a customer that is not related to you rolling. Say you have a bulk tanker and over pressure during offloading and blow their bag house to crap (bag house is all the dust filters and they are expensive). CGL would cover that, or a liquid tanker that had a spill not related to maneuvering (hitting something). OR if someone slipped and fell on a wet floor at YOUR place of business. Revenue and class of business are to them (though I disagree) are a better gauge of your risk and ability to pay whatever self-insured retention (think deductible) you may elect. CGL has usually been fairly cheap for trucking in relationship to other policies, unless running tankers or something that has a risk of going real wrong during unloading. With 120 trucks and dump wagons ours ran about $7K a year for the longest time til a couple rolled over dumping and happened to roll over onto a building once and a front end loader once and a whole bunch of pipelines and conveyors once - but all in the same year. Then they dropped us ($200K in losses - $7K in premium. They went WAY upside down on us that year). We had a $3k deductible and they still ate it big time on us. We renewed at $10K with another carrier.

Hope this helps.

 

Oh, and go online and look up your NAICS and or SIC (any search engine of the two will return a ton of free places) and make sure YOU choose the correct code for your particular class of business and when asked by any insurance person you give them THAT number. Sometimes just telling the agent or broker what you do leaves THEM to the searching for an NAICS or SIC "code" and them being insurance folk and not trucking companies - they get the code wrong (there are many for all the different types of trucking) and the wrong NAICS or SIC can jack your rates just because you are mis-classified as to class of business. Think of the difference in unloading risk between an interstate liquid hazmat hauler and a local daycab, dry box non-haz hauler.

 

There is a simple reason. The more money someone makes the less likely they are to file a claim.

Have you ever been in an accident where it was minor and no cop was around? A lot of times people would just pay out of pocket to cover the damage so as not to hurt their insurance.

Someone that lives paycheck to paycheck though cannot do that and will have their insurance cover it.

So insuring someone financially responsible is less risky than someone that does not make much.

 

I got to respectfully disagree to an extent. Maybe with non-commercial policies I agree about how likely to file a claim. With the Commercial GL, though, it's really a lot more about ability to pay the premium and deductible and how likely you are to have an accident period. We had CGL accidents every year but our deductible covered it. We always filed the claim b/c not filing what looked initially minor, then somehow turned into more than our deductible and we didn't report it would have voided coverage for ""Non-Timely Reporting as Contractually Agreed Upon" and we'd have had to eat the whole loss. Business to Business accidents are handled from an entirely different perspective than Joe Lunch Box dinging up Suzy Soccer Mom's SUV in the Walmart parking lot. As a business we always have to assume we will get sued over anything and file it, even if it is minor. I can't tell you how many scratched fenders wound up as I hurt my neck and want my check scams in an attorney's office and insurance had to fork out more than our deductible in defense attorney fees.

I hate to say this, but that's not a logo on the side of your truck. It's a bullseye target for every wannabe insurance lottery winner player. Doesn't tend to happen in CGL claims, though cause it's B2B and we both suffer from scammers (a LOT of Work Comp Scammers) and just want to fix what's broke and move on. So we file it, but b/c we have been burned so MANY times - we CYA and make sure it all goes through proper channels including the insurance carrier. Don't think THEY won't try to get outta payin' something either. Can't do that if we filed the minor claim timely and it turned South. So Businesses tend to file and THEN pay themselves to keep costs down rather than not file and risk a $1,500 claim under deductible that you pay becoming a $15K claim that won't be paid by insurance cause you handled it yourself and didn't notify the insurance company per the clause in the contract for reporting all accidents. Your Insurance Company might or might not claim to be a Good Neighbor, but I promise that whatever they claim to be - failure to report an accident that went from minor to major will cut them off into: "Who? What Company? No. We don't have that claim. Sorry. Sue them."