The green industry in California has budded into something beyond mere beautification. It’s an important part of the state’s economy, generating billions in revenue and creating hundreds of thousands of jobs.
According to the California Landscape Contractors Association, the green industry encompasses any business involved in the production, distribution, and services associated with ornamental plants, landscape, garden supplies and equipment. Some of the key players include landscape contractors, architects and maintenance firms.
Workers in green industry professions face a wide range of exposures on a daily basis, from typical liability issues, to commercial auto and workers’ compensation risks. Back in 1989, a group of landscape contractors in California banded together to develop a co-owned insurance agency, named Landscape Contracting Insurance Services (LCIS).
To this day, LCIS claims to be the only insurance brokerage in the US committed to the green industry. It provides specialized insurance to cover every aspect of a green business, from contractor’s equipment coverage, to business auto coverage, employment practices liability and workers’ compensation.
As a member-owned brokerage, LCIS has given back over $40 million in rebates to its insurance clients, as well as distributing equity shares in excess of $450,000 since its inception. The brokerage is completely member-focused and is always looking to invest in additional services geared towards green industry vocations, explained LCIS president and CEO, Kim Ayala.
“We’ve been providing specialized insurance for the green industry for 30 years,” she said. “We’ll take on any risks from small contractors to very large construction contractors. It ranges from one landscape contractor with a truck all the way up to huge contracting firms with fleets of a few hundred commercial vehicles, working on major projects like landscape construction and maintenance for shopping centers, hotels and golf courses.
“Right now, about 95% of our business is in California, but we’re looking to expand our broker network into new states like North Carolina and Colorado where there’s a high concentration of contractors. For our Californian members, the balance between construction and maintenance firms is about 50/50. When the economy picked up, we saw a boom on the construction side of things. There’s a lot of work for Californian contractors right now.”
It’s not always easy for landscape contractors to get the right insurance coverage, especially if they shop only by price – something that smaller companies without huge returns are often tempted to do. There are common exclusions (e.g. subsidence) that brokers and policyholders need to be aware of. As a member-owned agency, LCIS is focused on filling the common coverage gaps left by others, Ayala explained.
As an outdoors industry, it would be reasonable to presume that landscape contractors are extremely vulnerable to weather-related risks. While coverage can be limited in certain areas with coastal exposures, Ayala explained that LCIS’s greater book hasn’t been heavily impacted by the natural catastrophe events in the past few years.
“When it comes to extreme weather, we don’t have that much property exposure and therefore haven’t seen too many losses. Most of the losses have been in general liability or commercial auto,” Ayala told Insurance Business. “Even with the fires in California, we haven’t seen many losses among our members. We had one member who lost some trucks in the wildfires, but it wasn’t significant. As for some of the colder weather states, perils like hail and snow aren’t too impactful because contractors are generally maintaining the landscape, and so this mitigates some of the risk.
“For the past year and a half, the auto side of things has presented the most challenges. Getting adequate pricing for business auto coverage is really difficult these days. The frequency and severity of losses has gone up because of things like distracted driving, which is a huge problem in California.”
