Every once in a while (and more so with every passing day) you have to admit to yourself that you are a little behind the curve on a particular topic. Insurance is that kind of topic for me. I know more than the average person, but just enough to get into trouble if I am not careful.

So when I was asked to prepare an article about controlling insurance costs, I made a decision to ask for help from a pro who consults to dealers and rental companies about how to buy insurance.

I contacted Jim Ricker of J. Griffin Ricker & Assoc. to help me out. Jim is an independent consultant who works for dealer/rental companies to select coverage and negotiate premiums to make sure the business owner stays in the driver's seat when it comes to insurance costs. Jim's comments follow.

How to keep insurance costs down
First and foremost, losses must be kept under control. There are two factors of loss that drive premiums up, one is frequency and the other is severity. An underwriter will look more at the frequency and type of claims as opposed to the severity. The purpose for insurance is to protect against those losses that could put a company out of business or seriously impair the function of their day-to-day operations. Frequency could indicate that a serious claim looms. The day of the nickel and dime claims are a thing of the past. Dealers are going to have to do a better job at educating their employees and taking on a greater responsibility for loss prevention/control.

In today's business world, management has to set the culture of its business in order to survive. This also means making better choices when hiring staff. Companies need to check motor vehicle records, verify previous employment, industry experience, educational background, manufacturer's training and so on. They must require mandatory drug testing and complete compatibility testing for new hires. Companies like Raia & Associates Inc. offer Step One surveys that measure integrity, reliability, work ethics and attitude toward substance abuse. For information regarding the Step One program and employee testing, call (614) 851-9233.