Engineering Inc. - March/April 2004 - 24

 Split limits offer a Premiums are derived way to increase your in part
from a firm's total coverage at a annual billings. So lower cost. if
billings go up, even without losses, CHUCK KOPPLIN, GRAEF, premiums
probably ANHALT, SCHLOEMER & will go up. ASSOCIATES, INC. TOM PORTERFIELD,
market is not quite as hard as it cipline, or services offered. VICTOR O.
SCHINNERER & CO. was 18 months ago. A carriers' Chuck Kopplin, who chairs
goal is to reach and maintain t h e ACEC Risk Management rate adequacy,
based on the risk C o m m i t t e e that oversees the profiles they choose
to under- annual survey, also believes the write, he explains. That may
market will continue to harden require continued rate increases i n t o
2004. When the correc- but not as high year after year tion began,
carriers knew they as in the last couple of years. couldn't get premiums
as high as one way to control increases in Corbett says hard insurance
they needed to in just one year. premium. That involves taking when the
soft cycle arrives, so m a r k e t s usually last between With multi-year
increases under on some additional risk for the our policyholders are
unaffected two and four years. I do see it their belts, he says,
engineering firm, Kopplin says, but also it when the hard cycle is upon
us, starting to slow a bit, though firms are looking at a variety of could
mean substantial savings said David Coduto, president of each account still
needs to be ways to reduce premium costs. for firms that do a good job in
Te r r a Insurance. We stick to under written on an individual managing
their risk. Managing Risk: o u r pricing and underwriting b a s i s , he
says. That means Changing your deductible is a Deductibles and principles,
while our policyhold- some firms may see significant d e c i s i o n that
should not be Split Limits ers maintain excellent loss pre- i n c r e a s
e s , particularly if they t a k e n lightly, Porterfield cau- v e n t i o
n and risk managerial are coming off multi-year poli- When premiums were
decreas- t i o n s , since the deductible practices. cies that haven't
been touched ing, companies could buy a lower applies on a per-claim
basis. If Rates are still increasing, but i n a while, while others may
deductible for little or no increase y o u raise it from $10,000 to
perhaps at a decreasing pace, s e e little or no increase in premium. Now,
many firms $20,000 and see two claims this s a y s LeVan, who believes the
because of limited growth, dis- find increasing the deductible is year,
that's $40,000. The deci- What are your firm's primary fields of Does your
firm carry practice or disciplines? professional liability insurance? No
13.0 Architectural 5.6% 60.6 Civil/General 26.4 Electrical 23.6
Environmental 10.6 Geotechnical 94.4% 23.9 Mechanical 37.3 Structural Yes
Surveying 32 26.7 Transportation 21 Other Percent 0 10 20 30 40 50 60 70
Are your per-claim and aggregate limits the same? How often did your firm
turn down work due to No concern about the potential threat of litigation?
34.8% Frequently 0.6 Sometimes 26.2 65.2% 46.4 Rarely 26.8 Never Yes 5
Percent 0 10 15 20 25 30 35 40 45 50 2 4 E N G I N E E R I N G INC. M a r
c h l April 2004
Engineering Inc. - March/April 2004

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