An Individual Policy covers only one person or one company (and its employees). The person or company purchases the policy themselves from an insurance broker. With a Master Policy, a number of individuals with at least one shared characteristic band together and collectively purchase a single policy.

To obtain the insurance, you may be required to belong to an association and pay a fee to join. The association retains the Master Insurance Policy, which covers the people who belong to the association. The Master Policy General Liability Insurance serves as the model for the policy covering each member of the association.

Generally, the insurance company charges fees based on the demographic composition of the group, rather than each individual's characteristics. In some cases the cost of insurance under a Master Policy plan is lower than for individual policies due to lower acquisition and administrative expenses. However, certain conditions can cause nasty surprises.

Drawbacks of Master Policies:

• The association can cancel the Master Policy at any renewal time, leaving the group association members uninsured.
• Should a large claim be submitted to the association holding the Master Policy, the insurance company could cancel the Master Policy, leaving the members without insurance coverage.
• Although some Master policies do offer per-member limits endorsements, other Master policies have a cap on the liability limits they will pay out on claims for the entire association. In some cases we have seen the total liability capped at as little as $5,000,000 for the association and its members. Just think, if five members each file a claim for $1,000,000, then the entire association would have no more coverage.

Review your options with a DCI Agent to learn more.

Our focus is upon:

• Accessing your insurance requirements
• Matching your needs with the right kind of coverage
• Providing the highest level of coverage for the lowest cost