Waiver of Subrogation: What Is It and Why Do You Need It?

At J.T. Bates Insurance Group, we specialize in risk management products specifically developed for equipment dealers and rental houses. Our products help equipment dealers reduce risk and improve profitability while adding value for rental, lease or purchase customers.

According to Investopedia.com, “Subrogation is a term describing a legal right held by most insurance carriers to legally pursue a third party that caused an insurance loss to the insured. This is done in order to recover the amount of the claim paid by the insurance carrier to the insured for the loss.”

Subrogation is a term describing a legal right held by most insurance carriers to legally pursue a third party that caused an insurance loss to the insured. This is done in order to recover the amount of the claim paid by the insurance carrier to the insured for the loss.

As an example, assume you were driving a car and were in an accident that was someone else’s fault. Your insurance carrier, Your Carrier, pays for the damage to your vehicle. After the claim is settled, Your Carrier can subrogate against the other driver’s insurance carrier, Their Carrier, and demand that Their Carrier pays for the damages since their insured was responsible. With a waiver of subrogation in place, Your Carrier cannot demand compensation from Their Carrier.

The main benefit of a waiver of subrogation is that it protects equipment owners, contractors and sub-contractors from damaged relationships. One of our flagship rental products, Rental Equipment Protection, includes a waiver of subrogation. With Rental Equipment Protection, J.T. Bates Insurance Group will pay to repair the damage from covered perils and will never demand the insurance carrier of the responsible party compensate us for the claim. In this way, our clients do not need to worry about damaging relationships with their rental customers, and their rental customers do not need to be concerned about claims affecting their business insurance premiums.

For more information about Rental Equipment Protection or to obtain a free, no obligation quote, visit the Contact Us section of our website, or call us at 1-877-900-8729.

Five Reasons to Outsource Certificate Management With Straight|Docs

Managing certificates of insurance can be time-consuming for equipment dealers and rental houses, but it doesn’t need to be. Here are five reasons to outsource certificate management with Straight|Docs available only from J.T. Bates Insurance Group.


1 – Verification

Many rental dealers collect certificates at time of rental but may not verify proper proof of coverage. Straight|Docs Compliance Services team members personally verify the certificate of insurance is both current and valid, and contacts the insurance company on our client’s behalf. Direct contact with the insurance company ensures faster turn-around times with no time spent waiting on form letters arriving through the mail.


2 – Prevention

Prevention is less costly and less risky than finding a solution after a problem with a certificate of insurance arises. Straight|Docs Compliance Services is a proactive solution to certificate management that limits exposure to risk.


3 – Protection

Straight|Docs Compliance Services helps you protect your assets and is fully developed and endorsed by J.T. Bates Insurance Group, a consulting firm with over 30 years of experience in the equipment industry. With Straight|Docs Compliance Services, our clients can focus on growing equipment rental sales instead of tracking certificates of insurance.


4 – Archiving & Organization

Straight|Docs Compliance Services stores forms with a paperless archiving system in a secure database, so there is no concern about losing business-critical information. Since our certificate management software is web-based, it is perfect for organizing certificates for a multi-location dealership and can even help organize and track sales tax exemption forms.


5 – Flat Rate

No more surprise invoices for certificate or forms tracking services. With Straight|Docs Compliance Services low, flat rate pricing, the fee is calculated on an average per-document basis to simplify rental operations and add value for our clients.


Contact us today for a free, no obligation quote to see how Straight|Docs can help with certificate management.

Top 10 (Okay, 11) reasons you need Rental Equipment Protection Part 2

In our last post, we covered the first five reasons you need Rental Equipment Protection™ (REP). Read part one of our two-part series here.

In this post, we will continue to explore the ways that REP is the best risk management solution for rental equipment.

6 – Competitive Rates.

In number five of our 2-part blog post about REP, we explained the difference between all risk coverage and named perils coverage.

Client satisfaction is at the center of everything we do. Because of our extreme focus on serving our clients, we offer very competitive rates for all risk coverage through REP. In fact, we challenge you to find better rates for all risk coverage.


7 – Low deductibles.

We also keep our deductibles low. Our program is simply the best value in physical damage coverage while equipment is out on rent. Keeping our deductibles low helps equipment dealers clearly communicate the value of the program to their rental customers, but not so low that rental customers have no incentive to take care of the equipment while in their custody.


8 – Low deposits.

Our deposits are also kept very low and always count toward the coverage. We believe that one of the best ways to help our clients grow their rental businesses is by keeping their costs low. We pride ourselves on being a great partner.


9 – Waiver of subrogation.

We include a waiver of subrogation in our REP program. This means that after paying our clients for a loss, we will not try to recoup those funds from the insurance company of the rental customer. The benefit of a waiver of subrogation is that there is no risk to damaging rental customer relationships and insurance premiums will not increase as a result of a loss.


10 – Limited exclusions.

Our list of exclusions is short – criminal activity committed by the dealer, loss of use, mechanical breakdown, missing property (unexplained or mysterious disappearance), and normal wear and tear. That’s it. Damage due to weight of load? Covered. Damage due to flooding? We’ll pay for that, too.


11 – Last and most importantly…

Rental Equipment Protection™ from J.T. Bates Insurance Group was created with equipment dealers and rental houses in mind. It’s specifically tailored to be the very best physical damage coverage while equipment is out on rent, and it’s backed by A+-rated insurance carriers.

For more information or to obtain a free, no-obligation quote, contact us here or call 877-900-8729.

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Top 10 (Okay, 11) Reasons You Need Rental Equipment Protection

Rental Equipment Protection™ (REP) is physical damage coverage while equipment is out on rent. This post is the first of a two-part series that details several of the best reasons for choosing REP over other damage coverages available.

1 – Increases rental profit.

We’ll just come out and say it: Rental Equipment Protection™ (REP) from J.T. Bates Insurance Group improves profitability for rental businesses. It does this in two ways. First, it provides an add-on sale for the rental company. When REP is sold with an equipment rental transaction, a portion of the fee paid for REP pays for the program. This portion is also tax-deductible. The rest of the fee goes to the dealership’s bottom line. Second, REP improves profitability by eliminating risk. More on that later.


2 – Provides replacement cost.

Replacement cost is a much better option than actual cash value. Providing replacement cost means REP will pay the dealership money to replace the equipment that was damaged beyond repair (provided the equipment is less than five years old).

In contrast, actual cash value means market value of the equipment, and is calculated by subtracting depreciation from replacement cost (Original cost – Depreciation = Actual Cash Value).


3 – If you already self-insure, REP eliminates risk, not profit.

With REP, there is no need for equipment dealers to reserve funds in order to pay for claims. REP reimburses for claims while enhancing profitability for the equipment dealer. In many cases, offering a comprehensive program like REP increases customer participation, which in turn increases revenue.


4 – Claims will not affect business insurance premiums.

Rental customer claims are not covered by the dealer’s business insurance policy, so with REP there is no risk that business insurance premiums will increase due to a loss or a claim. With REP, risk is transferred to a secondary policy, and claims are handled quickly with no headaches. This is a benefit to your customer as well since the program has a waiver of subrogation clause which means we won’t go after your customer’s insurance company to repay the loss.


5 – All risk coverage reduces risk for rental business better than named perils.

Named perils means only the type of damage specifically listed in the coverage is paid for by the insurance company. Typically, this does not include common losses like overturns or collisions and as a result is quite limited.

With REP, equipment dealers enjoy all risk coverage. This means that unless a loss is specifically listed as an exclusion to the policy, the dealer will be paid for damages.


Check back next week for the sequel to this blog post, Top 10 (Okay, 11) reasons you need Rental Equipment Protection (Part 2).


For more information or to obtain a free, no-obligation quote for Rental Equipment Protection, contact us here or call 877-900-8729.

5 Things Every Equipment Dealer Needs To Know About Damage Waivers

Damage waiver: an oft-misunderstood but vital component of the equipment rental industry. This blog post will serve to define what damage waiver is, explain how it works, what to expect in terms of coverage, and how to provide a damage waiver to rental customers in a way that will improve profitability for a rental business and add value for renters.

  1. What is a Damage Waiver?

Called by many different names (Loss Damage Waiver, Rental Equipment Protection, Fire Theft Vandalism) with varying degrees of value, but with a common objective. Renters are responsible for any losses or damage to equipment while it is out on rent. A loss damage waiver (LDW) serves to limit the financial responsibility of the renter to repair damage to rented equipment in exchange for a fee usually listed as a line item on a rental bill.

A damage waiver is not insurance, but is often part of a program offered by a licensed insurance carrier. It reduces any exposure to a renter’s business insurance policy and eliminates the renter’s need to provide proof of physical damage insurance before renting equipment. It simplifies the rental process and the claims process.

  1. What does it pay for (or not pay for)?

The truth is, it depends.

Some damage waivers are “named perils” only, which means the only losses that are covered are the ones specifically listed in the fine print. Before renting equipment from an equipment dealer with named perils coverage, the renter should do their due diligence and become familiar with the terms of the rental agreement and which perils are covered.

“All risk” coverage, like Rental Equipment Protection™ (REP) from J.T. Bates Insurance Group pays for damage except named exclusions for the rental period. With REP the only exclusions listed are criminal activity committed by the dealer, loss of use, mechanical breakdown, missing property (unexplained or mysterious disappearance), and normal wear and tear. Proof of purchase of REP is required for any claims, and claims will not affect business insurance premiums. With all risk, it’s covered, unless specifically stated otherwise. REP also has a waiver of subrogation which means when the renter damages the equipment, we will not contact their insurance company to recoup the money we have paid out for damages.

  1. Deductibles

With damage waivers in general, equipment dealers and rental houses will often pass through their cost with high deductibles. With REP, deductibles are low and it is up to the dealer to decide if and how to pass the deductible on to the renter. In the event of a claim, the renter would pay for repairs up to the deductible amount, and REP covers any remaining damage with the exception of a very short list of exclusions.

  1. How to sell it

It’s easy enough to sell a damage waiver. Add it to the rental and it’s protected. Rental Equipment Protection™ in particular is a value-add for the rental customer. Clearly communicating the benefits of REP to customers in easy-to-understand language is an effective way to facilitate sales. JT Bates offers marketing materials and training to assist.

  1. Where you can find it

Rental Equipment Protection™ is an exceptional damage waiver option and is only available from J.T. Bates Insurance Group. Call us today for a free, no obligation quote to find out how REP can help your rental business increase profitability while eliminating risk, or to ask us about pricing for this program.

3 Benefits of Extended Warranty Through Protect My Iron®

At some point, even the best equipment could fail and require repairs due to a warranty issue, which can bring progress on jobsite to a halt. Even with backup equipment, repairs can be expensive. Protect My Iron® is an extended warranty agreement for new or used equipment offered by J.T. Bates Insurance Group that protects against the expense of unexpected repairs.

Extended warranty contracts can be transferred when the equipment is sold, so they help to yield a higher resale value. Customers can choose to insure their machine’s powertrain, powertrain plus hydraulics, or the entire machine. Consider offering an extended warranty product like Protect My Iron® to your customers.



Protect My Iron® extends the original equipment manufacturer warranty period and covers the cost of retail parts for repairs. That’s good news for equipment owners because modern equipment is becoming more complex than ever, with increasingly expensive technology, computer equipment and electrical wiring.

Some extended warranties cover parts but not labor. Depending on the certified repair dealership that completes the repairs, labor costs can range anywhere from $100-$250 per hour, toward the lower end for in-house repairs and toward the upper end of the range for road calls. With Protect My Iron®, shop rate labor is covered, ensuring a completely covered repair in the event of a warranty claim.



An extended service contract like Protect My Iron® communicates a commitment to customer service by taking an extra step to protect equipment and keep the business running smoothly. Protect My Iron® builds working relationships between equipment dealers and contractors, rewarding both parties and encouraging repeat business.



Because Protect My Iron® has three types of protection—powertrain, powertrain plus hydraulics, and full machine—it is the only system you need to provide customers with personalized service from an extended service contract. And because it was created by insurance experts with hands-on experience in the construction industry, it’s the only product that has been created exclusively for construction equipment dealerships.

Want to learn more? Contact J.T. Bates Insurance Group at 1-877-900-8729 or jbates@jtbatesgroup.com.

Increase Rental Revenue With Add-on Sales

Good news, equipment rental companies.

The American Rental Association (ARA) (http://www.ararental.org/) has released its second quarter outlook, which predicts continued category revenue growth of 5.6 percent in 2016 and 4.9 percent in 2017 in the U.S. The domestic rental segment is expected to top $50 billion within three years. It’s a good business to be in, and it’s growing faster than the U.S. economy right now (more…)