"The rate increases year over year are taking a toll on our clients, and businesses can't survive," says independent agent John Heist. "While agency owners love the hard market, it's the account managers and producers that must deliver the increases, which can wear your team down."
John G. Heist
Senior Vice President
Heist Insurance Agency
Ocean City, New Jersey
How did you get started at your agency?
After graduate school at The College of Insurance, I worked in the insurance and hospitality industries in New York City. Ten years later, I was ready to move out of the city, so I moved back to my hometown in Ocean City, New Jersey, to work with my brother and father in the family agency.
Why liquor liability insurance?
I'm comfortable with the coverage because I'm comfortable with the exposure. I worked front of house at some very good restaurants in New York City, so I understand how restaurants and bars work. I can tell when an owner is running a safe operation versus a risk management nightmare. I don't get involved with nightmares.
Changes in the liquor liability market?
Carriers are using social media to help with underwriting. For example, I know of an underwriter that looked at social media for a bar they were quoting and saw that the bar was hosting beer pong tournaments. The underwriter wanted the client to agree in writing that beer pong would not be played at the bar, or they would not quote the risk. Also, some carriers will offer you a lower premium comparatively, but may be leaving off an important coverage such as assault and battery.
Challenges in the liquor liability market?
Finding a premium that doesn't make the owner freak out. I know of a client with a 25% revenue increase and they got a 70% rate increase. The rate increases year over year are taking a toll on our clients, and businesses can't survive. While agency owners love the hard market, it's the account managers and producers that must deliver the increases, which can wear your team down.
A lot of markets are severely limiting assault and battery coverage, which is unacceptable if you own a bar. Also, a good number of excess markets have totally pulled out of anything involving liquor. A limited market with increasing premiums is a tough future trend.
Advice for a fellow agent in the liquor liability market?
Be cautious and let risk be your guide. Spend time with the owner and frequent the restaurants and bars that you are working on. Watch the management, staff and clients. Are they overserving? Who is the clientele? Be careful with bars and always get updated loss history.
Olivia Overman is IA content editor.