NASMM Insurance

Frequently Asked Questions

Q: What Protection does the Program Provide?

A: PROGRAM HIGHLIGHTS
1. Insuring Company – Travelers Group
2. Statutory Availability – Continental United States*
3. Coverage’s Available:

Property – including Computer Hardware and Property in Transit
Property of Others - in Your Care Custody and Control
General Liability - covers your businesses common law tort liability for bodily injury and property damage
Non-Owned & Hired Automobile Liability - covers employees using their own cars in your business, and cars you temporarily rent to use in the business for LIABILITY only
Employee Dishonesty (employee theft against you the employer )
Business Income ** - covers lost profits and continuing expenses after a covered property loss

B. MINIMUM Limits of Liability provided by the Travelers Package Policy (higher limits may be available subject to underwriter approval for an additional premium):

$ 10,000 Property (including Computers)
$ 10,000 Customers Goods in your Care, Custody & Control (Bailees Coverage)
$ 1,000,000 General (Business) Liability
$ 1,000,000 Non-Owned & Hired Automobile Liability
$ 25,000 Employee Theft of YOUR property

Umbrella Liability - increases the coverage available for both automobile and general liability claims - $1 and $2 million limits are available
Automobile (Business or Personal form) - for your owned vehicles used in the business)*
Blanket Crime (Fidelity) Bond – covers theft of CUSTOMERS GOODS by you and up to three of your employees

$10,000 protection                           $120 annually, plus $6 billing fee
$25,000 protection                           $210 annually, plus $6 billing fee
$50,000 protection                           $330 annually, plus $6 billing fee

Workers' Compensation - State mandated coverage for your employees (or uninsured sub-contractors) – MRSC can arrange this coverage for you & your company

4. Annual Minimum Premium Cost for the Travelers Package policy (excluding separately written Auto and Umbrella policies) *

California - $ 750
Coastal Windstorm Counties (includes all of Florida) - Liability Only (PROPERTY COVERAGES ARE EXCLUDED ) - $500 (C. Optional coverages are still available)
All Other States - $ 500

Q: If I have homeowner’s insurance and am running a home-based business, why do I need “Business Insurance”?

A: The Liability Section of the Standard Homeowner’s Policy specifically EXCLUDES coverage for “business operations” other than “incidental” business operations (such as paper routes and baby sitting). It also has a Property coverage LIMITATION (generally no more than $ 500/claim) for “Any Property Used in Business”. Thus, a NASMM member operating from home has NO Liability coverage and little Property coverage unless they purchase “Business Insurance”.

Q: Does membership in NASMM guarantee insurance protection under the program?

A: No. Each member must apply and will be subject to individual underwriting which will include:
     1. Location of Operation
     2. Experience
     3. Type(s) of Services Offered
     4. Claim Experience
     5. Statutory Worker’s Compensation Classification*

         * Some classifications are considered “undesirable” by the insurance company.

Q: Are there other “requirements” to be met to secure the insurance?

A: Yes. Each member MUST be willing to enter into uniform contracts with clients and independent contractors as a regular course of business. These contracts MUST include a Hold Harmless Agreement, A requirement that ALL parties carry insurance, and that all parties provide evidence that they carry insurance.

Q: Why are the contracts so important?

A: To answer that question, here is an example of an ACTUAL claim that occurred for a NASMM member. The member and several of their independent contractors were working at a client’s home. The CLIENT also had an independent contractor working on premises at the same time installing a ceiling fan. The CLIENT’S contractor drops the fan onto the head of one of the MEMBERS independent contractors and injures them. There are no contracts in place with ANY of the parties. The NASMM member contacts their liability insurance company to file a claim and is told that it is NOT covered because the injured independent contractor is subject to WORKER’S COMPENSATION coverage (a standard exclusion in ALL Business Liability contracts). The injured independent contractor does NOT carry Worker’s Compensation coverage. The member contacts the client’s contractor and finds out that the contractor does NOT carry Business Liability insurance. The member then contacts the client’s homeowner’s insurance company and is told there is NO coverage because there is no NEGLIGENCE on the part of the client! As of this writing, this matter has yet to be resolved.

This “problem” could have been avoided had the member had a written contract with the client in place that required the client to carry (and show evidence of) homeowner’s insurance AND a Hold Harmless agreement making the client responsible for their negligence as well as any INDEPENDENT CONTRACTORS hired by the client.

Q: What is an “Annual Minimum Premium Cost”?

A: An Annual Minimum Premium is the minimum charge that an insurance company makes to issue a policy. This charge is made irrespective of the type(s) or amount(s) of coverage contained in the policy.

Q: Why are there coverages in the policy that I may not need nor want?

A: There are two (2) reasons. First, some of them are “built-in” and cannot be removed. The coverages are offered by the company as incentives to purchase the product. Secondly, because of the Minimum Annual Premium charge, some coverages were increased (i.e. Personal Property coverage) so that the ACTUAL annual premium was equal to the minimum charge. This way each member receives some benefit from paying the minimum charge.

Q: Why aren’t all coverages available in every state?

A: Individual state’s requirements sometime restrict an insurance company’s ability to offer certain products. In addition, specific geographical areas present hazards that many insurance companies do not want to entertain. An example of this is Property Insurance coverage in coastal areas (due to the hurricane exposure).

Q: How long will it take for me to get a quote?

A: That depends on what type of insurance you are requesting and where you are located. For the “basic” policy, Automobile coverage, 3rd Party Employee Dishonesty, and Umbrella coverage the time frame should be somewhere between two (2) weeks and four (4) weeks (sometimes sooner). The Worker’s Compensation will normally take about thirty (30) days to process.

Q: What is the process for getting a quote?

A: MRS&C will do the “paper work” for you. We will need you to supply us with the following documentation:

Copy of client letter/agreement (Mandatory. You are not eligible for the program without a client agreement)
Copy of your existing coverage (if any)
Copy of your Damage Liability Policy (if any)
Your website address
Copies of any other marketing materials (brochures)

Once we receive your documentation and have had a chance to review it, Mark Mendes will contact you (a 20-30 minute conversation) to discuss the information and ask questions required by the insurance company. We will then forward the information on to the insurance company to secure the quotation. Once we receive the quote, we will forward (fax/e-mail) a proposal to you.

Q: If I decide to purchase the coverage, who do I contact with questions?

A: Once your policy is issued, you will receive it directly from the insurance company along with information about their Business Insurance Service Center. There are several of these centers nationwide and you will be given the contact information for the center nearest to you. These centers provide 24/7 service for you. We suggest that if you have any questions about your billing you should contact the service center directly. On ANY other issues (changes, coverage questions, claim reporting) we suggest you contact either Mark Mendes directly or MRS&C.