Unable to get insurance, company may close!

[samcharlton]

My name is Sam,

I've been running a niche staffing agency for a couple of years now.
We supply staff with motorcycles to industries who use a lot of couriers. Rather than paying for both an assistants day rate and lots of couriers throughout the day, companies now get assistants with motorcycles who can ferry around their requests.

We had a fleet Motorcycle Hire for Reward policy last year. 5 bikes, hire for reward, third party only, any rider over 25.
That insurer got bought out and now the new underwriter is refusing to renew our policy.

I've spent weeks on the phone to brokers. There is no other policy and the company now can not trade as it once did.

Any help or suggestions would be gratefully received.. Thank you!

 

[JEREMY HAWKE]

The insurers dont like risk anymore . Have you had many claims in the past

 

[fisicx]

HI @samcharlton and welcome to UKBF

It's a bit confusing as to what sort of insurance you need.

Are the riders employed by you?

Do they each have their own bike insurance?

Are you just the man-in-the-middle who negotiates the contracts?

Or do you supply the bikes and each rider rents them from you?

If the latter I'm not surprised you struggle to get insurance as it's a vary high risk business.

 

[Frank the Insurance guy]

Hi @samcharlton ,

Sorry to hear of your situation.

You say you are a niche staffing agency? Sound like you are supplying a rider and a bike? If so, it sounds like a courier business to me?

Are you struggling with the Motor Insurance side of things or the Employers Liability?

Unfortunately not my area of expertise, but sounds like a Courier Bike Insurance policy would be suitable?
- Have you tried: https://www.bikesure.co.uk/motorcycle-courier-insurance/

 

[Gecko001]

Falling between two stools?

 

[IanSuth]

Norman Insurance who became MMA who ended up as Covea used to specialise in fleet/taxi/courier insurances - might be worth trying to approach direct.

Otherwise try finding out who Domino's use. They own their bikes and have them usable by any employed rider with suitable licence so must have the kind of policy you are after.

 

[samcharlton]

The insurers dont like risk anymore . Have you had many claims in the past

No claims, 1 year fleet CCE.

 

[samcharlton]

HI @samcharlton and welcome to UKBF

It's a bit confusing as to what sort of insurance you need.

Are the riders employed by you?

Do they each have their own bike insurance?

Are you just the man-in-the-middle who negotiates the contracts?

Or do you supply the bikes and each rider rents them from you?

If the latter I'm not surprised you struggle to get insurance as it's a vary high risk business.

We operate as an agency. The company owns the bikes and we prefer the ability to send freelance contractors on any of the motorcycles at short notice.

We had insurance for the year and were negotiating an LTA before they backed out of any policy at all.

 

[samcharlton]

Norman Insurance who became MMA who ended up as Covea used to specialise in fleet/taxi/courier insurances - might be worth trying to approach direct.

Otherwise try finding out who Domino's use. They own their bikes and have them usable by any employed rider with suitable licence so must have the kind of policy you are after.

Covea sounds familliar. I will get a broker to reach out to them.

Believe me, I see all the many courier companies trading and want to understand what policies they use too. Food delivery I believe is a separate and specific product rather than general hire for reward.

 

[samcharlton]

Falling between two stools?

That's one i've not heard..

 

[IanSuth]

Covea sounds familliar. I will get a broker to reach out to them.

Believe me, I see all the many courier companies trading and want to understand what policies they use too. Food delivery I believe is a separate and specific product rather than general hire for reward.

I have mates who work/worked as bike couriers ( i have had bikes and belonged to bike groups since the early 90's)

The standard set up is the courier firm contract the rider, the rider owns and insures the bike. It is rare nowadays for firms to own their own bikes.

The big boys (like deliveroo etc) make their riders agree they are self employed and swear blind they are insured/pay for one of those iffy secondary cover for business/delivery insurance policies based in iffyland. I had a long conversation with my mate who stopped couriering just after covid (having couriered for c20 years) he said there was no way to make any money anymore whilst staying legal and competing with "self employed" people on illegal ebikes willing to break every road law. I even saw an article the other day, a youtube guy did 24hrs straight working as a fastfood cycle courier in London, he managed to "earn" c£90 gross in those 24 hrs.

This i think means a rapidly shrinking market for services to legit courier firms and insurance relies upon big numbers for the risks to average out at a predictable amount - if a market shrinks too far it is just too much uncertainty.

 

[Porky]

Sounds to me like you need a registered lloyds broker to take something like this on. This will be out of reach for your average broking outfit. Back in the day you would be getting it underwritten by a syndicate at Lloyds at a premium.

Not sure if these will help but you could call them explain the issue and see what they say or if they know a syndicate that could support you:-

Courier

We have a dedicated team of Courier specialists that knows the importance of having a fast turnaround time when it comes to quoting

www.ers.com

I recon this will be expensive mind you

 

[LPB 123]

Have you tried Devitt?

 

[JEREMY HAWKE]

Sounds to me like you need a registered lloyds broker to take something like this on. This will be out of reach for your average broking outfit. Back in the day you would be getting it underwritten by a syndicate at Lloyds at a premium.

Not sure if these will help but you could call them explain the issue and see what they say or if they know a syndicate that could support you:-

Courier

We have a dedicated team of Courier specialists that knows the importance of having a fast turnaround time when it comes to quoting

www.ers.com

I recon this will be expensive mind you

It is expensive but as we say on here its the cost of doing business and your pricing of services or goods should always reflect these high costs

 

[Gecko001]

That's one i've not heard..

What it means that you fall down between two things. In this case it could be that you perhaps can get insurance for being couriers and you can perhaps get insurance for assistants, but perhaps assistants who are also acting as couriers.

 

[samcharlton]

What it means that you fall down between two things. In this case it could be that you perhaps can get insurance for being couriers and you can perhaps get insurance for assistants, but perhaps assistants who are also acting as couriers.

ah i see! not really, it's more the insurance market has abandoned the fleet courier policy idea. Even the big courier companies seem to lease bikes to individual employees and have individual policies for them.

For us we want the flexibility that comes with the company owning the bikes and being able to send any rider to a job at short notice.

 

[samcharlton]

I have mates who work/worked as bike couriers ( i have had bikes and belonged to bike groups since the early 90's)

The standard set up is the courier firm contract the rider, the rider owns and insures the bike. It is rare nowadays for firms to own their own bikes.

The big boys (like deliveroo etc) make their riders agree they are self employed and swear blind they are insured/pay for one of those iffy secondary cover for business/delivery insurance policies based in iffyland. I had a long conversation with my mate who stopped couriering just after covid (having couriered for c20 years) he said there was no way to make any money anymore whilst staying legal and competing with "self employed" people on illegal ebikes willing to break every road law. I even saw an article the other day, a youtube guy did 24hrs straight working as a fastfood cycle courier in London, he managed to "earn" c£90 gross in those 24 hrs.

This i think means a rapidly shrinking market for services to legit courier firms and insurance relies upon big numbers for the risks to average out at a predictable amount - if a market shrinks too far it is just too much uncertainty.

Thanks so much for this,

it confirms our experience 100%. We paid a high price for our policy to keep ourselves legal, thinking the premium would only decrease over time with our no claims. The first year renewal (with no claims) came back higher this year. We were pissed off but willing to pay it just to stay legal. Now they are not even going to offer that policy! We literally can not operate with the legal level of insurance regardless of price. The product simply doesn't exist. We can not be the only small->medium size courier company out there facing this issue. It's a massive gap in the market. It makes me want to become an underwriter!

 

[samcharlton]

It is expensive but as we say on here its the cost of doing business and your pricing of services or goods should always reflect these high costs

Sounds to me like you need a registered lloyds broker to take something like this on. This will be out of reach for your average broking outfit. Back in the day you would be getting it underwritten by a syndicate at Lloyds at a premium.

Not sure if these will help but you could call them explain the issue and see what they say or if they know a syndicate that could support you:-


I recon this will be expensive mind you

Hey! yes our first year was expensice, but as pointed out, it was the cost of doing business and priced in to the product. we also (incorrectly) presumed it would get cheaper year on year with our no claims.

This year they came back even higher! We were annoyed, but willing to pay just to keep trading. Now the insurer won't even offer the insurance at the price they mentioned.

Thanks so much for the link and the info. I will reach out to them first thing tomorrow!

 

[Porky]

You wouldn't want to be an underwriter, whilst i appreciate its frustrating from your perspective, from the insurance companies perspective they are not concerned about the cost of the bike, its liability claims. Only takes one of your drivers in a hurry to run a pedestrian over and that's 20 years of what you were paying in premiums up the Suwanee, Third party compensation claims are off the scale.

But i think you have the answer; either try and find some high risk underwriter at Lloyds prepared to underwrite this at a very high premium and terms, i have known some businesses with fleet covers with massive TP claims excesses like £10k so i think cover is doable but at price OR you rethink your business model and your drivers have to hold their own cover.

Feel your pain with this inconvenience but its not an insurmountable business problem, you will work out a solution to this one way or another. All part of the fun... Good luck to you.

 

[samcharlton]

You wouldn't want to be an underwriter, whilst i appreciate its frustrating from your perspective, from the insurance companies perspective they are not concerned about the cost of the bike, its liability claims. Only takes one of your drivers in a hurry to run a pedestrian over and that's 20 years of what you were paying in premiums up the Suwanee, Third party compensation claims are off the scale.

But i think you have the answer; either try and find some high risk underwriter at Lloyds prepared to underwrite this at a very high premium and terms, i have known some businesses with fleet covers with massive TP claims excesses like £10k so i think cover is doable but at price OR you rethink your business model and your drivers have to hold their own cover.

Feel your pain with this inconvenience but its not an insurmountable business problem, you will work out a solution to this one way or another. All part of the fun... Good luck to you.

really appreciate the kind words! The chase is on.