Facility Maintenance Company Hired & Non-Owned Auto: Pricing Methodology

What rating basis does Hired & Non-Owned Auto use for Facility Maintenance Companies?

The pricing unit for Hired & Non-Owned Auto on Facility Maintenance Companies is per employee + flat hired-auto factor. Carriers multiply a per-unit rate (the base loss cost set by ISO, modified by carrier-specific factors) by the exposure to produce the base premium.

This is the most important number on the policy — it controls how renewal premiums move as your operation grows or contracts. The audit at policy expiration trues up the actual exposure against the estimated exposure used at binding, producing return premium or additional premium.

The class-code decision for Facility Maintenance Companies on Hired & Non-Owned Auto

The ISO class assignment for Facility Maintenance Companies on Hired & Non-Owned Auto is a judgment call by the underwriter, guided by class manuals and standard operating definitions. The facility maintenance company provides the operational facts; the underwriter maps those facts to a class.

The wrong class is the most common cause of overpayment on Hired & Non-Owned Auto accounts. We recommend asking the broker to confirm the assigned class code on every binder and comparing it against prior years — inconsistencies often point to a correction opportunity.

Underwriter judgment in Facility Maintenance Companies Hired & Non-Owned Auto pricing

Schedule rating is the underwriter's judgment overlay on Facility Maintenance Companies Hired & Non-Owned Auto. Within filed bounds (typically ±15-25%), the underwriter can credit or debit the account based on operational factors not captured by the base rate or experience modifier.

Common credit triggers: documented safety program, claims-free history beyond the experience-mod window, sub-class operations cleaner than average, strong financial reserves. Common debit triggers: minor compliance issues, unusual operations, or financial concerns.

The experience modifier on Facility Maintenance Companies Hired & Non-Owned Auto

Experience modifiers on Facility Maintenance Companies Hired & Non-Owned Auto are calculated from three years of paid losses, with the most recent year weighted heaviest. The calculation excludes the most recent policy year (still developing) and uses the prior three completed years.

Claims roll out of the mod window after three years. That is why pricing improves over time after a paid claim — the third anniversary of the claim is the point where it stops affecting the mod and pricing returns to baseline (absent new claims).

What changes at renewal for Facility Maintenance Companies on Hired & Non-Owned Auto

The renewal-time recalc on Facility Maintenance Companies Hired & Non-Owned Auto captures everything that has changed in the year between policies. New rate filings, your new exposure, your new loss experience, and any operational changes you disclosed all feed into the new premium.

If the renewal number surprises you, ask the broker for the line-by-line breakdown: base rate change, exposure change, experience-mod change, schedule-rating change. Each line is auditable. An unexplained renewal jump usually points to one of those factors moving meaningfully.

How carrier loss-cost multipliers move Facility Maintenance Companies Hired & Non-Owned Auto pricing

Two carriers can quote the same facility maintenance company on Hired & Non-Owned Auto and produce premiums that differ 15-30%. The difference comes from carrier-specific loss-cost multipliers (each carrier's adjustment to the ISO base rate), schedule-rating philosophy, and target loss ratios for the segment.

Some carriers actively pursue facility services business and price aggressively for it; others see the segment as marginal and price defensively. Knowing which carriers are currently in either bucket is the broker's job — and it materially affects which markets to target.

Common methodology mistakes that overprice Facility Maintenance Companies Hired & Non-Owned Auto

Facility Maintenance Companies Hired & Non-Owned Auto accounts most often carry hidden costs in three places: a class code that has drifted from the actual operation, an exposure declaration that overstates revenue or payroll, and an experience modifier that hasn't been verified against the carrier's calculation.

Asking the broker to walk through each of these at renewal — preferably before the renewal quote is finalized — produces the largest single set of correctable savings on the policy.