When it comes to securing insurance coverage, housing organizations generally have two options: obtaining required coverages through a single carrier as part of a package policy or purchasing the necessary coverages from separate carriers.
Both approaches can be effective, depending on your organization's risk profile, loss history, geographic location, and coverage needs. Understanding how these factors influence your decision is crucial to making an informed choice.
We asked John Welch, senior business development consultant with HAI Group, when it makes sense to separate coverages versus consolidating coverage through a package policy.
What is the difference?
A package policy combines several coverages under one carrier. Depending on the insurer, these may include property, liability, automobile, excess liability, and additional related coverages.
On the other hand, separating coverage involves purchasing different coverages from different carriers.
"With separate coverages, an organization may place property coverage with one carrier and liability coverage with another, depending on the needs of the portfolio, the abilities of the carrier, and the options available in the market," Welch explained.
Both approaches can protect your organization, but managing the policies differs greatly.
When separate coverages may make sense
There are several situations where purchasing coverage from multiple carriers may be necessary or beneficial.
A common reason is that a carrier may not offer certain coverages the organization needs, particularly for specialized risks such as flood, wind, hail, or catastrophe-related exposures that require specialty insurance markets.
Market conditions matter, too. After significant losses or changes in underwriting appetite, organizations may use multiple carriers while stabilizing their insurance program.
"In some cases, organizations find themselves placing coverage with multiple carriers after experiencing significant losses, changes in the carriers' underwriting guidelines, or other market challenges," Welch said.
In these circumstances, securing the necessary coverage is the priority.
"When an organization faces a challenging claims environment, securing essential coverage comes first," Welch explained. "After conditions stabilize, it's wise to consider if consolidating coverage with a single carrier could provide administrative and operational benefits."
Separate coverages offer flexibility and access to specialty services but also require more coordination and administration.
The benefits of a package policy
For many housing organizations, a package policy offers a more streamlined approach to managing insurance coverage.
"A package policy enables greater cohesiveness across coverages. It also helps organizations build a program tailored to specific risks and operational needs," Welch said.
Administrative simplicity
One of the most immediate advantages is the ease of administration.
With a package policy, organizations often use a single renewal process and billing structure. They also get a single point of contact for policy questions, endorsements, and coverage changes.
"Managing a package policy is often simpler administratively," Welch said. "Billing, renewals, endorsements, and policy questions typically involve one contact. This not only eases the work involved in managing their insurance policy, but it also enhances the relationship between the client and carrier."
This reduces administrative burden and saves time coordinating with multiple insurers.
Simplified claims handling
Claims coordination is another key benefit.
If a loss affects multiple coverages, such as property and liability in a fire, a package policy can streamline the claims process.
Instead of managing multiple carriers for one claim, organizations typically resolve issues with a single insurer.
"Having a dedicated claims contact who understands your organization and insurance program can help streamline communication throughout the process," Welch said.
Better coverage alignment
Packaging coverage can also help reduce the potential for coverage gaps or overlaps.
With one program, organizations better understand how coverages interact and respond to losses.
This gives confidence that exposures are addressed consistently across the organization.
Stronger working relationships
Another benefit is building long-term relationships with your insurer and claims team.
"Working with a single carrier helps organizations build relationships with their account team," Welch said. "Continuity and familiarity are valuable when claims or questions arise."
This familiarity is particularly valuable when handling complex claims or discussing future coverage needs.
Questions to ask before deciding
Each organization's situation is unique. Before choosing between package policies and separate coverages, consider these questions: Does your current carrier offer all the coverages you need?
- Are there geographic exposures, such as flood, wind, or hail, that may require specialty coverage?
- Has your organization experienced recent losses that could affect carrier appetite?
- How much administrative complexity is your team willing to manage?
- Would consolidating coverage improve communication, claims handling, or operational efficiency?
Working with a knowledgeable insurance professional can help you evaluate these factors and determine the most appropriate approach.
Which approach is right for your organization?
For many housing organizations, a package policy is the most efficient, streamlined way to manage risk. But some situations require placing certain coverages with specialized carriers.
The right approach depends on your organization's unique circumstances, including its risk profile, loss history, geographic exposures, and coverage requirements.
"Every organization is different," Welch said. "The goal is to find coverage that meets your needs and keeps the policy manageable and effective."
Whether your organization ultimately chooses a package policy, separate coverages, or a combination of both, the key is ensuring your insurance program aligns with your operational needs and long-term risk management goals.
If you're evaluating your insurance options and would like to discuss whether a package policy or separate coverages are the right fit for your organization, contact the HAI Group Business Development team.
