What Is A Surplus Lines Insurance Company?
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Insurance coverage is important to people and businesses to ensure the things you care about are covered. However, it can be more difficult for some to get insurance coverage because of the high risk of accidents or damage. Luckily, there is a solution to this in the form of surplus lines insurance.
Keep reading to learn more about surplus lines insurance, what it covers, and how it can be used to protect your business or belongings.
What is Surplus Lines Insurance?
Surplus lines insurance is a unique type of coverage that protects businesses regular insurance companies might avoid due to high or unusual risks. Businesses seek out surplus lines insurance companies because others aren’t willing to financially risk covering their company. These companies exist to insure businesses and actions outside the scope of what typical insurance companies will cover.
What Does Surplus Lines Insurance Cover?
Surplus lines insurance can cover a wide range of businesses. However, an excess of risk or unusual circumstances is common among businesses that seek surplus lines insurance. For instance, flood insurance is a common form of surplus lines insurance. Flood insurance is often more expensive since there is more risk involved in providing this type of coverage.
Certain industries are also more likely to need surplus lines insurance. For example, contractors and house remodelers may need to seek surplus lines insurance. Due to employees’ exposure to dangerous equipment, many regular insurance providers are unwilling to cover these companies. Surplus lines insurance is an option to ensure that these businesses can still get coverage.
These are just a few examples of what can be covered by surplus line insurance. This insurance coverage can also be used to cover highly expensive items or items of higher risk.
How Does Surplus Lines Insurance Differ from Regular Insurance?
There are a few key differences between surplus lines insurance and regular coverage. While regular insurance companies must have a license in your state to cover your business, surplus lines insurance can be bought from a company anywhere. Granted, a surplus lines insurance company needs to carry a license in your state.
There is also a little more risk for businesses covered by a surplus insurance lines company. These companies do not have a backup fund in case they go bankrupt. Therefore, there is more risk in trusting these companies to cover your business and your claims. However, surplus lines insurance can still be an option for people who need insurance but can’t get covered by regular companies.
Get Insured Today
The bottom line is that surplus lines insurance is a great way to insure businesses and items with a higher risk of claims. This insurance can cover a wide range of industries and circumstances while being more accessible for those who can’t get insured by regular companies.
Finding the right insurance policy for you and your business doesn’t have to be a headache. Partnering with an experienced and knowledgeable insurance agency like Dopazo Insurance gets you the answers you need so you can make your best insurance buying decision. Get a quote today to learn more about how we can help you!