EXPOSED
By Ross Kinman
How often do you expose yourself? You’re not the type of person who would do such a thing. Or are you?
If you work for or own a towing and recovery business, you are exposing yourself on a daily basis.
In using the word “expose,” I am not referring to anything that has to do with removing your clothing. I suppose, however, if that is what you WANT to do, it’s not any of my business. In my case, no one would pay attention anyway.
In this column, I am talking about liability exposure. We expose ourselves and our companies to property damage or personal injury risk each time we do our job. Some situations involve more risks or exposure than others. Property damage can easily occur to your equipment or someone else. Personal injury or even death is always possible when doing the type of work we do. An accident might involve you, an employee, or an innocent bystander.
We all have (we’re all supposed to have) liability insurance coverage. This means the limits and conditions of the policy are correct, we are protected. How long has it been since you have read your policy? All of it!
Most people believe they are protected under all circumstances up the face amount of the policy. They further believe a one to three million dollar umbrella policy provides them ultimate protection.
Insurance companies are not stupid! They know we might be asked to do almost anything in our work. We might fool with explosives and destroy a town or do something stupid like pull the Space Shuttle out of the mud. (I wonder what a used Space Shuttle costs?)
Let me tell you a true story. (I’ll only change the facts to make it interesting. Okay, okay. I’ll tell the truth.)
Most people believe they have liability insurance covering the handling of aircraft. I can tell you there are only a HANDFUL of companies in our industry having such coverage. Because of the additional costs, I’ll bet you my son’s old car there are a dozen or less in all of the country.
Once in a training class, I asked my students how many of them had coverage to handle aircraft. Almost everyone held up their hands and said they had that type of insurance. I then asked them to check their policies when they got home and if they had the coverage to give me a call. I didn’t get any calls.
Sometimes, our towing company is hired to go to the east side of Indianapolis to lift a helicopter onto a trailer so it can be transported. Once in the classroom, I used this job as an example to try and make an important point. There were about 60 students in this particular class, most of whom were owners of towing companies. Four of the students represented the insurance industry, two of whom were underwriters.
I asked the students to listen closely to the details of the job and then be prepared to answer a couple of questions.
“You are called to go to a location that is about 10 miles from your office. They only thing you have to do when you get there is to lift a helicopter. The customer will provide qualified aircraft technications who will do all of the hook-up work, using their own slings and attachment devices."
“All they have asked you to do is to extend your boom and lift the thing after they have hooked it up. They will back a trailer under it and you will lower it down. That’s all there is to it.”
“Before you left your office, realizing you didn’t have adequate coverage, you call your insurance man. You knew he would take good care of your because his is your good friend or your cousin. You play golf or fish together all of the time. He will get you temporary coverage for the best price.”
“So you told your insurance friend you wanted protection for two hours that afternoon to do this simple job: lift a worn out 15 year old Bell Jet Ranger helicopter only worth $150,000. All you are going to do is lift it up and set it down; no problems. “
“Knowing you had adequate insurance coverage, you did the job beautifully. It was a picture-perfect job and you were only away from your office for an hour and a half.”
I asked all my students to write down the general amount they would charge their customer for this job. Now, you think about what you would charge and write it in this space $__________. The amount is none of my business or anyone else’s. You know what you would charge, so write it down and don’t read ahead before you do so.
Remember, you are going to send a bill, and in a few days you will receive a bill for the premium for the additional insurance coverage your friend provided you. Keep in mind, he didn’t help you do the job nor did he provide the equipment. He just sold you two hours of protection without leaving his office.
I asked the attending insurance representatives to give us a general estimate as to how much the coverage might cost. The minimum estimate was about $5,000. Please subtract their amount from the amount you charged your customers. You probably only lost about $4,500.
Every job you do involves a high degree of exposure to potential liability. If you have had insurance claims which caused your premiums to skyrocket or your policy to be cancelled, you have had first-hand experience.
When considering your price to any customer, stranger or friend, you must not forget you are going to expose yourself in their behalf. The best way to make a customer really appreciate your professional, specialized service is to charge in a professional manner. Do this like a professional, but don’t take advantage. You wouldn’t last long if you did.
God bless you.
(Reprinted with permission from ROSS KINMAN PROGRAMS, Inc. Excerpt from The Kinman Report, Spring issue, Copyright 1990.)
(reprinted with permission of Towing and Recovery Phootnotes Magazine, article was printed in the Oct 1990 issue , page 20)
