terrorist surcharge?

Discussion in 'Lawn Mowing' started by bobbygedd, Feb 13, 2003.

  1. bobbygedd

    bobbygedd LawnSite Fanatic
    from NJ
    Posts: 10,178

    got two letters in the mail, one from my personal insurance, and another from my business insurance. it said i may be recieving a "surcharge", they are calling this terrorist surcharge. anyone get that? anyone kbnow how much the surcharge will be?
  2. HarryD

    HarryD LawnSite Bronze Member
    Posts: 1,069

    terrorist surcharge :confused:
  3. Gravely_Man

    Gravely_Man LawnSite Silver Member
    Posts: 2,076

    Bobby, I have not heard about this surcharge and thought you were kidding at first. I can see the insurance companies raising rates to cover their loses and projected losses with all of the bad things going on in the world be this is news to me. Please keep us posted on what you learn.

  4. davesgs75

    davesgs75 LawnSite Member
    Posts: 72

    I received one from my insurance company to. It has been awhile since I got it in the mail, can't remember much about, and don't know any prices, or any other details.
  5. Mykster

    Mykster LawnSite Senior Member
    Posts: 668

    My sister works for a well known builder. She was just telling me last night that a bunch of their contractors are calling it quits because the insurance rates are going through the roof.
  6. AL Inc

    AL Inc LawnSite Bronze Member
    Posts: 1,218

    Like Gravely Man said, I have seen my insurance rates go up, and between auto and business liability, it is almost a $1500 increase. I have never made a claim. They don't call it a "terrorist surcharge" but that is basically what they are blaming it on. I will have to pass along these increases but will not call it a "terrorist surcharge". Most people would think that is BS.
  7. cutting edge

    cutting edge LawnSite Member
    Posts: 194

    I received one of these letters also. The increases vary for the different types of coverage. And then there are differences within each category depending on if your primary location is in a particular city or not.

    for example:

    Commercial property coverage - 7% increase if your primary location is in a designated city; 3% increase if it is not

    Commercial general liability - 1%

    Commercial inland marine - 1%
  8. Hawkeye5

    Hawkeye5 LawnSite Senior Member
    Posts: 295

    Refer to the Federal "Terrorism Risk Insurance Act of 2002". Maybe do a Google search for additional information. In a nut shell, every insurance company writing commercial business is required to offer coverage and help pay for "certified acts of terrorism". There is a Federal backstop (re-insurance) for the insurance industry based upon the fact that terrorism is not an event that is predictable using current modeling techniques.
    In order to be a "certified act" the losses in the aggregate must exceed $5 Million, are committed by people acting on behalf of any foreign interest, and is certified by the Sec. Tres., Sec. State and the Attorney General of the US. (this leaves out domestic acts such as Oak City).
    Insurance companies are required by the act to provide a disclosure which has high level detail about their obligations under the act.
    Most companies will make coverage for "certified acts of terrorism" optional. If you feel you don't need the coverage, opt out, don't buy the coverage.
    The surcharges are going to be all over the place and may depend on the commercial insurance rating statutes in your individual state. I have seen surcharges filings for as little as 0.01% up to 25% from different companies for the same coverage. Much of this is dependent on the perceived exposure to terrorism for the type business. For instance, airports and pipelines are much more targeted than lawn care.
  9. DLCS

    DLCS LawnSite Platinum Member
    Posts: 4,378

    I recieved a letter from State Farm las week about terrorism. This letter states that a act of terrorism would be covered by the federal government to 90% of loss. State Farm has had the terrorism coverage in everybody's policies since Nov. 2002.
  10. MOW ED

    MOW ED LawnSite Fanatic
    Posts: 5,028

    I got one too but there was no charge to my policy, or should I say - there was no "direct" charge to the policy.

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