Key insurance factors to consider

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Courtesy of Waste Advantage Magazine

Moving towards sustainability in our culture requires social and economic challenges chat influence our everyday lives. Our efforts toward ethical consumerism have helped fuel the increase of the recycling industry. The subsequent growth of the industry results in more risks for recyclers that must be addressed. This article will help identify some of those risks and issues that you should consider before working with an insurance agent or broker to protect your business.

Some of the factors that must be considered by recyclers and waste haulers are:

  • Origination. Recyclers and waste haulers now must consider that there is very little sorting going on at a local level.
  • Transportation, There may be more travel involved with the disposal of waste. Most of the materials to be recycled are being consolidated and sorted and then shipped later along with other shipments. In many cases, refuse is being transported to ports and more overseas shipping is involved.
  • Ports. More often, shipping ports are involved in the disposal of waste. We are running out of space in the U.S. and, consequently, shipping more waste materials overseas. There is added exposure whenever a shipping dock is involved. Both the dropping off and the picking up of the waste involves movement of the material and thus more risk.
  • Content. There is also an increase in discarded electronics. Much of this waste is rinding its way to China. By dismantling and reusing some materials, China helps to control the cost of finished goods for exports. Because some of the materials involved in electronics may be hazardous, there can be an additional risk, and therefore additional cost, to transport these materials.
  • Change of authority. The process of waste hauling and insuring that activity becomes more complex as the responsible parties change. In this case, owner-operators of tractor trailers responsible for the hauling of waste must understand the risks involved and be aware of any liabilities that incur in the process.

Getting Insurance for Your Business
At one time, finding insurance was difficult. Now, it's less so, given the number of competitors in the market. So while it may be easier to get insurance for your recycling business, owners and risk managers must be more cognizant of the underwriting data that helps determine the cost of your insurance coverage. While you certainly want to pay a reasonable rate of coverage, you also want to have faith that should an incident occur, it will trigger a reasonable claims response rather than a denial of benefits. Knowing what you are insuring and what the consequences are of any adjustments your insurance broker may be making in order to save you money, can have significant results.

The Marketplace
Companies that were involved in recycling at the dawn of the industry may not have had many options when it came to insuring their firm. Insurance companies were still learning much about the industry and many were reluctant to get into a field of so many unknowns. Now, however, as insurance companies have had financial success protecting the recycling industry, more companies want a piece of that pie. While a competitive marketplace helps to bring down pricing, it also puts the burden of knowledge in the hands of the consumer.

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