How K&K Insurance’s departure impacts powersports dealers
This article by Zach Materne originally appeared in the July 2024 issue of Powersports Business

Well, it happened again. For the fourth time in the last four years, a major underwriter has left the Garage Insurance market. In the last few weeks, K&K Insurance quietly decided to cancel their motorcycle and powersports franchised insurance program. K&K was unique because they were the only underwriters who would write for dealers of any size in all 50 states. They now join the list of underwriters who have turned their backs on our industry, joining Philadelphia, Harco, and Sentry (for non-Harley dealers).
WHAT DOES THIS MEAN FOR DEALERS?
In an already stressed market with so few underwriters, K&K was always the consistent option, specifically for smaller dealers. This now puts more stress on the remaining options, which undoubtedly will affect premiums and underwriting guidelines industry-wide.
WHY DOES THIS KEEP HAPPENING?
Commercial insurance carriers may exit markets due to various factors. Profitability is a primary concern, with carriers leaving unprofitable sectors to safeguard financial stability. Risk management plays a crucial role as carriers assess and mitigate exposures to high-risk segments.
Regulatory changes can prompt exits to ensure compliance with evolving standards. Strategic shifts, mergers, and acquisitions may lead to market realignment or consolidation efforts. Market dynamics, including economic conditions and competition, influence decisions to enter or exit markets.
Underwriting performance impacts carriers’ decisions, with exits from underperforming sectors to improve profitability. Capacity constraints, such as insufficient reinsurance support, also affect market participation. Ultimately, carriers prioritize profitability, regulatory compliance, and strategic alignment to ensure long-term viability and success in the commercial insurance landscape.
WHAT HAPPENS NOW?
Depending on your state’s laws, a notice of cancellation will be sent to you no later than 30 days before your renewal. If your current policy is with K&K, I would suggest reaching out to your broker as soon as possible to see what their plan is for an alternative at your renewal. Communication is key! While K&K’s exit may leave a void, there are still other underwriters in the market willing to provide coverage. Your broker should help navigate this transition and find the best solution tailored to your dealership’s needs.
FEW OR NO ADDITIONAL OPTIONS
One often overlooked factor in this search is the varying access brokers have to different insurance markets. Not all brokers have equal access, and some markets require specialized appointments that are only granted to offices with specific expertise, particularly those handling dealerships.
Work with brokers who deeply understand the dealership market and have established relationships with underwriters specializing in Garage Insurance. These brokers are more likely to have the necessary appointments to access alternative markets and can effectively advocate for dealerships’ needs.
The departure of K&K Insurance highlights the importance of broker access in the Dealership Garage Insurance market. Brokers not only manage relationships with their current markets but are always searching for emerging markets. By partnering with knowledgeable and experienced brokers, dealerships can navigate the insurance landscape with confidence and secure the coverage they need to protect their business assets.
Zach Materne is a property & casualty risk consultant for Apiar Commercial Risk Management. LA Resident License #871096; Cell Brokerage CA LIC. #OG83985; NPN #14775635
In addition to companies exiting the market there is something dealers should be aware of. There are what is called “claims based” and “occurance” based policies. Claims based means that the policy will only cover claims made within the policy period. Occurance based covers claims made that occurred during the policy period even if you no longer have a policy with the carrier. If you change carriers with a claims based policy you have no coverage for a claim that occurred during the policy period if it is made after the policy expired. Claims based policies are less expensive but unless it is explained completely by the agent when you purchase a claims based policy you simply don’t realize that you could be without coverage for a claim made after your policy expires. This happened to us. Dealers should be sure that they get an occurance based policy so there is no gap in coverage. Our agent from a major well known carrier did not explain this so we naturally went with the lower cost policy. A dealer would have no coverage for a claim that occurred during the policy period if the claim was made starting the day after the policy ended. It could put you out of business.
We once purchased a look-back period policy that covers this gap. James River was the carrier at time.