Have you ever completed your commute, and wonder how you got there? Your driving is a habit. When doing something habitual, we are not engaged in the task in the same way as when we are doing something that is not habitual. We all have habits, dozens, maybe even hundreds of them. Habits allow us to complete mundane tasks and frees our minds a bit from these tasks to consider more important matters.
Here’s another habit example: Buying toiletries. Most of us are tied to a certain brand of toothpaste or deodorant. Recently I was completing my shopping list and I reached for my usual antiperspirant. With a business startup, this product is a very essential item for me. However, this time I took a moment to read the label. The product provides 72 hours, SEVENTY-TWO hours of protection. I know a new venture is very stressful, but do I really need 72 hours of protection? Since my ritual is to shower every morning, my feeling is that 24 hours is plenty for me, so should I be paying for 72 hours? Perhaps a situation may arise where I need 72 hours of protection: Camping trip, banishment to the dog house, or some other unforeseen event. For the vast majority of my exploits, 24 hours of protection is more than adequate.
What does this have to with Equipment Breakdown Reinsurance? The traditional model is so ingrained in the industry it has become habitual; we should take a moment to evaluate the model. How much equipment breakdown coverage are you purchasing with your current carrier? Should you evaluate your current program to understand exactly what you need? Are you paying for too much coverage?