BULLET-PROOFING YOUR PLASTICS BUSINESS
An Interview with Insurance Experts, Fritz Mutter and Phil Beakes

Q: After fifteen years of working with clients in the plastics industry, you say that business owners in this industry today are in the driver's seat, as far as insurance is concerned. Could you tell the readers of this magazine why?

A: Plastics used to be considered a tough industry; all the large insurance carriers worried about liability claims, or property claims from fire. Today, because of good experience industry-wide, and even compared to other industries across all SIC categories, plastics is considered a "target market." What this means is that Fireman's Fund, Hartford, Atlantic Mutual, Chubb, Kemper, Safeco, and other good insurance carriers are willing to compete for your business. They'll offer you better prices and more competitive packages (Property, Liability, Autos, Business Interruption) and enhanced coverages simply because you're in the plastics industry.

Q: What would these enhanced coverages comprise?

A: Because you're in plastics, you can get greater protection at no additional cost for coverages such as: Transit; Accounts Receivable; Employees' Tools; Electronic Data Processing; Surface Water; Outdoor Signs; and Trees & Shrubs, Building Ordinance, and Newly Acquired Property, to name just a few. Some of these extras could potentially provide hundreds of thousands of dollars of enhanced coverage to cover your losses.

Q: That's quite a list of potential risks. Do any examples of some particularly unusual or unforeseen damages come to mind?

A: One of our clients experienced a minor fire at his company's manufacturing plant. His property insurance covered the fire damage. But the water that the fire department used to extinguish the blaze of course ran into the storm drain. The result? Our guy was socked with an $85,000 bill from the EPA and state Fish & Game. Fortunately, that amount was covered by his Pollution Insurance policy.

Q: Are there any circumstances that can't be covered?

A: Yes. Y2K exposures are a current concern, and are generally excluded from policies.

Q: How can a fabricator or distributor take advantage of the special rates and extra coverages you mentioned?

A: First, to get the best possible package, you'll want to have access to every insurance carrier that offers special programs to the plastics industry. This may mean working with three or four brokers. If you're fortunate, you could deal with just one broker -- if they represent all carriers. Next, make sure your broker understands the subtle differences between similar-appearing policies offered by different carriers. That way, they may even get a carrier to "manuscript" (customize) the coverage you need. There's no need to pay thousands of dollars in extra premiums, if you don't have to.

Q: You're a California-based broker. Would your expertise be useful to plastics distributors and fabricators in the rest of the country?

A: We first of all maintain good relationships and open communication with every insurance carrier across the country, to keep abreast of each new policy. Also, we find that most trends regarding coverage in this industry usually begin in California. Being aware of what's taking place here should help you forecast better. If it's happening in California, it's usually only a matter of time before you'll see it in your area.

Fritz Mutter and Phil Beakes own Golden Pacific Insurance Services, Inc.

For more information, contact Golden Pacific Insurance Services, Inc., 3280 E. Foothill Blvd., Suite 100, Pasadena, CA 91107, 626-583-1900, FAX 626-583-8535, e-mail: margaret@goldenpacificins.com

Neither The Plastics Distributor & Fabricator Magazine, nor KLW Enterprises, Inc., is responsible for the information or opinions contained in this magazine. All such information and opinions are those of the authors.