The Horse Park and Commercial Insurance

Last fall, Dallas was set to open a horse park near the Great Trinity Forest in southeast Dallas. The opening was delayed partly due to the operator, not having a commercial liability policy in place. Dallas city officials refused to allow the operator to open until an insurance policy was obtained.

This is not an unusual circumstance. Most property managers won’t allow a tenant to move into commercial office space until they’ve obtained a policy. In these cases, the management company must receive proof the policy is in effect and that they are listed as an additional insured.

The reason Dallas city officials or the property management company are adamant about the commercial insurance policy being in place before operations begin or office space is occupied is both parties could be found liable if someone got hurt and sued for negligence.

Usually this happens because someone waits to the last minute to find coverage. A couple of weeks ago, I received a frantic call from someone in this situation. The owner called me at 3:30 and were set to move into an office the following morning. Since he was unwilling to provide me with the information I needed to present to our commercial underwriters, I was unable to help.

Getting a quote for commercial insurance is not like getting a quote for car insurance. It takes more than 15 minutes to produce. Underwriters want several pieces of information just to see if the prospective client’s business meets their underwriting guidelines. More information may be needed to provide a quote. At a minimum, commercial underwriters want:

  • Name of the company and dba if applicable
  • Entity type (corporation, LLC, sole proprietor)
  • Tax ID number
  • Description of operations
  • How long the business has been in operation
  • Experience and history of ownership
  • Current policy limits and who the policy is with
  • Loss history
  • Number of employees
  • Past, present, and projected revenues
  • Information about the space to be occupied

In some cases I’ve been asked to provide copies of business contracts, resumes of key employees, and payroll data. If commercial vehicles are involved, drivers’ licenses, VINs of vehicles, their value, and garaging zip codes will be needed. Supplemental applications may be required for specific business types such as car repair shops, tow truck operators, cab drivers, contractors, and certain types of consulting firms.

Once the information is gathered and presented to underwriters, obtaining a quote can take as little as a few hours or up to a couple of weeks. This amount of time is partly dependent on the type of business operations and the level of information provided initially. Waiting to the last minute only adds to everyone’s anxiety and create a situation where a deadline can’t be met.

What’s the most unusual piece of information you’ve been asked to provide in order to receive a commercial insurance quote? Share that with us, along with any questions, comments, or suggestions you may have on our Facebook, Google +, or LinkedIn pages! I’d love to hear from you!

Evie Wise
Evie Wise


Evie Wise
Evie Wise

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