Once a new policy is bound, the inspection process will begin. All new business policies are typically inspected within 60 days of binding. Underwriting will use the inspection information to do the following:
- Verify Exposures
- Ensure price adequacy
- Identify potential gaps in coverage
- Make recommendations to reduce hazards
The inspection will verify that the information listed on the policy is accurate and will help to establish proper coverage limits. Some of the exposures that we review are:
- Building information
- Entertainment
- Management involvement
- Cooking
Our timely inspections allow us to quickly address any discrepancies and to make necessary adjustments.
In addition to exposure verification, we are looking for opportunities to reduce hazards for both property and liability. Mandatory recommendations are intended to reduce or eliminate hazards that may lead to costly claims. If any hazards need attention, the Loss Control Representative will discuss these needs for service, repair, or update to the property. They will also address any operational concerns that could create losses in the future. Common mandatory recommendations include:
- A metal container with a sealed lid must be used to store oil/grease soiled rags/towels to avoid spontaneous combustion.
- A minimum 16” clearance is required between fat fryer and open flames or an 8” baffle must be installed between the two.
- Fire suppression system must be serviced immediately by a licensed contractor and semiannually thereafter.
- Hoods and ducts must be cleaned immediately by a certified contractor and semi-annually thereafter.
- Loose or missing handrails must be repaired or replaced.
If mandatory recommendations are not satisfied, the Underwriter will review to take appropriate action. This may include pricing for the exposure or cancellation.
The inspection process will continue throughout the life of the policy, as exposures change frequently in the hospitality industry. Renewals will be inspected every three to five years, except nightclubs and gentlemen’s clubs, which are inspected annually.
Learn more about insuring your business with ICC by contacting an ICC agent today. The Find an Agent search on our homepage will help you locate an ICC agent in your area.
