As mentioned previously, a number of hoteliers are facing nonrenewal notices and scrambling to locate acceptable coverage. A major carrier has decided to pull out of the hotel/motel business, leaving thousands of insureds searching for another carrier. Agencies handling these policies are forced to halt any new business marketing as they themselves go on a search for a credible, stable replacement for their policyholders’ business insurance.

It’s a situation I’ve seen often as companies attempt to secure business in areas in which they have not operated in the past. The insurers undercut the market price in order to establish a book of business. And it works. Business floods in as insureds are attracted to the lower price.

That brings up the reason these companies leave the business. They’ve undercut competition for so long that financially, they’re unable to continue. If a company isn’t doing too badly in the space, they’ll raise rates 5 percent, 10 percent, and still maintain a lower price. But too often, companies will have gone so low in price that in business terms, it’s no longer practical to maintain the business. That’s when you receive your notice of nonrenewal.

What can policyholders do if their policies are canceled through no fault of their own? With a mere 45 days’ notice in some states, hotel insurance policyholders are left scrambling alongside their insurance agents. The reason: most insurance agencies do not specialize in hotel insurance. Options being limited, it’s now a quick search in hopes that a reputable program can be found to replace the dropped coverage.

Smart agencies that are committed to full service are already many steps ahead. We at VIP Hotel Insurance partner with multiple insurance companies, giving our customers many options. Our access to numerous regional markets gives customers a wide array of choices. Also, our provider list includes a number of what we consider legacy carriers – those insurers who have strong, established books of business in the hotel insurance market.

Where most agencies can offer you fewer than five choices, VIP Hotel Insurance typically offers its customers up to ten choices. This helps you find a program that suits your distinctive needs at a price that’s in line with what you’ve budgeted for. Because we have access to local coverage, we can give you more geographically specific options.

Contact us. We can point you in the right direction. Our contracts with multiple carriers gives you options that others can’t. We have the availability to the top carriers both nationally and locally. These are companies that specialize in your business. To see your options, give me a call.

flickr photo credit: Lars Plougmann