Your Driving Record and How It Effects Your Premium

Your insurance company has the right to review your driving record at any time.  Typically, they’ll review your record when you apply for coverage, request changes to your policy, add a vehicle, or renew your policy.  This is to evaluate your risk potential, or determine if you are insurable at all.

Generally, what the insurance company will analyze is the number of points on your license.  When found guilty of a traffic violation (moving violations, parking tickets, at-fault accidents, etc.) you are assigned a certain number of points on your license. The more points you accumulate, the worse your record. The points on your driving record may or may not affect your insurance rate since each company has their own way of evaluating violations.

Insurers typically evaluate your points using their own system to determine the amount of your rate increase (if your rates increase at all).  Most companies, however, use the Safe Driver Insurance Plan, which lists the different types of violations and assigns a points value to each one, based on the severity of the incident.  Under this plan, as you accumulate points, your rates are subject to increase.

Your driving record isn’t the only information your insurer can use to underwrite your policy.  Insurers also use credit scores to determine rates. If you have a good credit score, your rates are likely to be lower than someone with a bad credit score. Insurance underwriters perceive a direct relationship between your credit score and the chances of you filing a claim. Someone with a history of being late on bill payments and who often opens and closes savings or credit accounts wouldn’t be viewed as a good insurance risk.

Trucks and Minivans Provide Greatest Threat of Back-Over Injuries to Children

The University of Utah completed a study that revealed some startling results about the likelihood of children being struck by a truck or minivan backing out of a driveway. Researchers found that children are 2.4 times more likely to be struck by a van and 53% more likely to be hit by a truck than by a car. The study also found that children hit by trucks or minivans are more likely to require hospitalization, surgery, and treatment in an intensive care unit than children backed over by cars.

The research was conducted using medical records and police reports that provided back-over injury data for Utah children under age 10 from 1998 to 2003. The number of state-registered vehicles was used to determine if injuries were more common among certain types of vehicles. The researchers further discovered that driveway back-over injuries represent an incidence of 7.09 per 100,000 children younger than 10 years old annually. Passenger cars account for only 1.62 injuries per 100,000 registered vehicles.  Previous reports have suggested that trucks and minivans produce a large rear blind spot, which makes them especially susceptible to this type of accident. However, this is the first study in the United States that has attempted to document the rate of injury by these vehicles.

The researchers emphasized the importance of educating parents and young children about the rules for safe play in driveways. They commented on the availability of rear cameras and sensors to warn a driver that a child or other obstacle is behind a vehicle. However, the study noted that there is no substitute for walking behind, or at least looking behind your vehicle before putting the car in reverse.

The federal government has also been working on this problem. Legislation pending in Congress would require the National Highway Traffic Safety Administration (NHTSA) to set a standard for rear visibility that all vehicles must meet. Larger rear-view mirrors, rear sensors that sound a warning beep or cameras are among the options.

NHTSA expects to complete work on a study on the various types of back-over technology within a couple of months. The purpose of the study is to examine how effective the systems are and how they are used by drivers. The information will then be used to establish a standard.

Are You Getting the Word Out with Your Hazard Communication Program?

OSHA first established the Hazard Communication Standard (HCS) on November 25, 1983; and with its complexity, it is often one of the most misunderstood of the agency’s standards and the one most frequently cited for violations. The core concept for the rule is “that employees have both a need and a right to know the hazards and identities of the chemicals they are exposed to when working. They also need to know what protective measures are available to prevent adverse effects from occurring.”

The HCS requires that both the physical and health hazards be communicated for all hazardous chemicals. Since the majority of chemicals used in the workplace have some hazardous consequences, they will be included in this mandate. 

The communication paradigm begins with chemical manufacturers and importers. They are required to evaluate the hazard potential of the chemicals they produce or import. This information becomes the basis for labels they prepare for containers, and for the more detailed specification sheets called Material Safety Data Sheets (MSDS). Chemical manufacturers, importers, and distributors of hazardous chemicals are obliged to provide the labels and material safety data sheets to the purchasers of these chemicals.

Any workplace in which employees are exposed to hazardous chemicals must have a written plan, which describes how the communication standard is being carried out. OSHA is not looking for something that is lengthy and convoluted.  An inspector wants to see a realistic system for meeting the requirements for labeling, accessibility of material safety data sheets, and employee training.  

To comply with the labeling provision of the rule, employers can make use of the labels provided by their suppliers. The information specified on the label must include the name of the material and any possible physical or health hazards associated with its use. Labels must be easy to read, and prominently displayed.  OSHA doesn’t mandate any specific requirements in terms of size, color or text.

If an employer transfers the hazardous chemical from a labeled container to another container, the employer is required to label the second container unless it is subject to the portable container exemption. To be considered portable, the container must be used for the immediate transfer of hazardous chemicals from labeled containers, and the employee who performs the transfer will be the only one to use it.

The purpose of the Material Safety Data Sheets (MSDS) is to provide detailed information about a chemical’s potential hazardous effects, its physical and chemical characteristics, and recommendations for protecting oneself when using it. OSHA doesn’t specify a format for the MSDS.

All MSDSs must be easily accessible to employees during their shifts. OSHA does not mandate the methodology for accomplishing this. Any methodology is acceptable as long as it meets the principal standard that employees can get the information when they need it.

If you plan to conduct your own hazard communication training, you may want to investigate Training Requirements in OSHA Standards and Training Guidelines, which was developed by OSHA’s Training Institute. You can get a copy from the Superintendent of Documents, Government Printing Office, P.O. Box 371954, Pittsburgh, PA 15250-7954.

After designing your hazard communication strategy, give it the acid test for compliance by seeing if it meets the following OSHA checklist:

• Obtain a copy of the rule

• Read and understand the requirements

• Assign responsibility for tasks to a specific employee

• Prepare an inventory of chemicals

• Ensure that containers are labeled

• Obtain an MSDS for each chemical

• Prepare a written program

• Make MSDSs available to workers

• Conduct training

• Establish procedures to maintain current program

• Establish procedures to evaluate effectiveness

Insure Your Boat In and Out of the Water

Millions of Americans take to the water each year during boating season, traveling the coastlines, rivers, lakes and canals all over the country. The watercraft range from simple rowboats to jet skis to small motorboats to luxury yachts. Boat owners spend significant amounts of money buying and maintaining their boats. The need for insurance protection when the boat is on the water is obvious, but many boat owners question the need for it during the off-season. However, insurance is just as important when the boat is in storage as when the owner is using it.

A typical boat insurance policy provides a package of coverages, including:

* Damage to the boat, motor, and trailer;

* Damage to portable property used in the maintenance and operation of the boat, including things like anchors, life jackets, oars, tools, skis and surfboards, lights, and fire extinguishers;

* Damage to other types of property, including sports equipment, clothing, and other personal effects;

* Damage to equipment on shore, such as boat covers;

* The cost of recovering a sunk or stranded boat;

* The cost of emergency service and towing;

* Damage to non-owned or substitute boats;

* Loss of fishing tackle;

* Liability coverage for injuries or damages for which the boat owner is legally responsible; and

* Coverage for injuries the boat owner or others on the boat suffer in an accident with an uninsured watercraft.

A boat owner will need these coverages if her boat gets into a collision with another boat, or if thieves steal scuba gear from it, or if fire damages the motor. However, losses are still possible while the boat is out of the water. Progressive Insurance reports that nearly two out of every 10 boat claims it receives from northern states occur between Labor Day and Memorial Day, when most owners are not using their boats much. Some examples of losses that could occur:

* The storage building housing the boat over the winter burns to the ground.

* Vandals damage the boat in the middle of the night while it’s in the owner’s driveway.

* A neighbor’s child, playing in the owner’s yard, runs into the boat stored there and injures his head.

* Someone steals the boat and its trailer from the yard at a repair shop.

* While the boat is stored in the yard, heavy snow melt causes a flash flood that damages the boat’s interior, including the mechanical system and the radio.

Some insurance companies offer “disappearing deductibles,” where the deductibles for collision and damage losses from other causes decrease by a certain amount for every claim-free year the policyholder has. Those companies will grant this benefit only to boat owners who keep their insurance continuously in force with them.

A professional insurance agent can provide advice on the types and amounts of coverage a boat owner needs. She can also recommend insurance companies that have expertise in boating, good claims-paying practices, and reasonable prices. Insuring a boat all year round can be expensive, but compared to the cost of a large uninsured loss, it may well be worth the cost.

Ten Loss Control Tips to Keep Your Work Laptop Safe

The growing trend of staying competitive by using the mobility and freedom provided by technology can often be a double-edged sword. While taking your show on the road to off-site business meetings is a lot more efficient and easier when everything you need to make an eye-catching presentation is right there on the laptop, the mobility of technology does open the door to losses from theft.

Here are some simple loss prevention practices that employees can adopt to ensure their laptop stays safe and secure at and away from their worksite:

1. Carry the laptop in a case that doesn’t standout or scream expensive technology with logos or emblems. The idea is that only the carrier knows the case contains a computer. To bystanders, the case could be full of useless papers or files.

2. When traveling, use the hotel safe to store your computer. Never leave an unattended computer in a hotel room. Hotels usually warn customers that they aren’t responsible for valuables left inside rooms. And, don’t think that a locked room door is a sufficient safeguard. Maid services routinely leave rooms wide open as they’re being cleaned, meaning a passer could easily swipe your computer while the maid is busy cleaning the bathroom.

3. Never leave a laptop on the seats or otherwise in plain view in a vehicle, even a locked vehicle. Trunks are also a highly-targeted area for thieves, as many assume this is where most people will try to secure their valuables. Whenever possible, take the computer with you or leave it in a more secure locked location.

4. Make sure that your laptop will be secure during breaks if you’re at an off-site meeting. Ask if the various entrances and exits will be locked during breaks and then observe to make sure the room is indeed secure before leaving your laptop. If any question, then carry your laptop with you.

5. Avoid checking your laptop as luggage during flights. There’s too much opportunity for it to be stolen or damaged. Remove the laptop from its carrying case and give it to the guard before you go through the airport security metal detectors.

6. Write down the serial number, make, and model of your laptop and keep this information separate from your laptop.

7. Even in your own office, you need to make sure that you store your laptop in a secure location when you aren’t using it, take lunch, or need to run to another area of the building. A good rule is to lock up your computer if you can’t directly see it from your location.

8. Of course, the physical computer isn’t the only loss you can suffer. Keep a regular data backup schedule to prevent lost data due to equipment failure. It’s also prudent to minimize how much intellectual property or proprietary data is stored in the hard drive.

9. Have a password system (preferably two-tiers) or a data encryption feature to protect your data.

10. Lastly, you might consider asking your employer to arm your laptop with a tracking device as a last line of defense. Tracking devices for computers operate much like a LoJack system does on your car. Once the software is installed on the computer, it will run in the background without you even knowing it’s there. Meanwhile, the program routinely reports the IP address your computer is using and who logged into it to the security company. In the event you report your laptop stolen, the security company can remotely change how frequently the above information is fed to them. Unbeknownst to the thief, the security company is tracking his/her location every time the computer goes online.

Keeping Your Identity Safe from Internet and Telephone Scams

What would you say the fastest growing crime in the United States is today? If identity theft came to mind, then you’re exactly right. Statistics by the Federal Trade Commission show that over 20% of all identity theft cases involve the internet and telecommunications. While you might think identify theft scams are easy to spot and avoid, the criminals behind such scams devote themselves to putting together emails, phone calls, and websites that appear enticingly legitimate.

Most email and telephone identity theft scams ask you to provide your Social Security number, credit card account information, or banking account information. According to the Identity Theft Resource Center, unless you initiate the call and know you’re speaking with a legitimate representative from the company you’re doing business with, you should never give out any personal or financial information.

Of course, there are innumerable scams circulating the country. The following are a few of the most commonly seen:

Moving Money Scams / Nigerian Money Offers

The “can you help me move my money from my country” scams were around before the internet was even a thought. Despite people being aware of the con, these scams still make $100 million each year. The scammers will send out mass emails. They claim to be in a foreign country, often Nigeria. They ask the recipient to assist them in moving their money out of their country and promise to pay the recipient from helping them. The explanation for the request is often a heartbreaking tale or humanitarian cause like a sick relative needing a surgery.

Phisher / Account Verification Scams

These scams involve the scammer purchasing domain names that closely resemble that of legitimate and reputable businesses. One of the most recent scams involved the E-Bay domain name. The scammers purchased domain names like and and sent out mass emails asking consumers to provide their personal and credit card information. The emails often asked the recipient to verify a purchase or made threats to cancel the account if the recipient didn’t provide the information. Other companies being used in alike scams include: AOL, PayPal, MSN, Discover Card, Best Buy, and Bank of America. Even if you’ve recently purchased an item or made a transaction with a company, you should never comply with emails asking for personal or financial information. Most companies don’t conduct business in such a manner. To make sure, use the official phone number for the involved company to find out if the request is legitimate.

Get Your Free Credit Report Scams

Most correspondence related to getting a free credit report will turn out to be a scam in one way or another. Free is usually the relative word since most receive a bill charging for the service after it’s used. Other free credit report scams are simply after your Social Security number.

You’ve Won A Free Gift Scam

The phone call or email saying that you’ve won a free gift is luring. The scammer will claim the gift is free, but that they need your credit card information to cover the shipping and handling. With your credit card number in hand, they can use it for a lot more than shipping and handling. Just remember that few things are free and those that are don’t require a credit card.

You’ve Won The Canadian Or Netherlands Lottery Scams

According to the FBI, this scam has collected approximately $80 to $100 million so far. Keep in mind that you first must buy a ticket or enter a lottery to win it.  If you haven’t purchased a ticket, you haven’t won.


This is a request for your personal and financial information under the guise of a friendly questionnaire. The scammer often claims to be a childhood or old social network friend. The questionnaire may blatantly ask you for your info or be subtly collecting information related to your account passwords by asking you your birthday, favorite things, name of your kids, and such. Delete the questionnaire. Giving false information only alerts the scammer they’ve reached someone willing to respond and possibly provide inadvertent information in the future.

IRS Audit Scams

Scammers have sent out emails claiming the recipient must undergo an e-audit within 48 hours or face penalties and interest. The e-audit questionnaire asks for personal and financial information. Be aware that the IRS doesn’t correspond with taxpayers about audits via email and certainly doesn’t have anything called an e-audit.

Resume Scams

Identity theft even occurs from sending out a resume. Scammers can place a print or online help wanted ad just like a real employer can. Never place your birthday or Social Security number on resumes. That information can be collected by legitimate employers during the interview stage.

The best way to stay safe is not responding, even with a don’t contact me or remove my name from the list email, to anything you feel has the potential to be a scam. 

Reduce Customer Bad Debts with Credit Insurance

When you sell to a new overseas customer, do you worry that you’ll get paid in a timely fashion, or worse yet, will the client pay at all? How do you quickly obtain high quality, reliable credit information about a company in a small, foreign country before you ship the goods? The answer lies with credit insurance. Used extensively in Europe for years, credit insurance is now being used more often by U.S. businesses in overseas and even domestic transactions.

Credit insurance is also known as accounts receivable insurance, bad debt insurance or credit risk insurance.  The types of risks covered by credit insurance involve non-payment by buyers due to insolvency, slow payment after delivery is made and for losses that resulted from a customer becoming insolvent before delivery of goods or completion of contract, but after the goods had been produced and shipped.

During times of economic downturn or gradual expansion, credit insurance provides an extra layer of protection for your company’s growth, and helps to calm nervous lenders. Often, the credit insurance policy can be used to reduce the cost of a loan, as it is almost a certainty that revenue from a specific source will be forthcoming.

Credit insurance may enable you to sell more goods on credit terms while substantially reducing the overall risk of exposure due to non-payment. It also may enable you to take advantage of peak and cyclical selling periods and to safely expand into new product lines or territories.

Generally, it is recognized that 20% of a company’s customers account for 80% of sales. Credit insurance protects against the devastating loss resulting from the insolvency of one of your key accounts. A credit insurance contract can insure your entire accounts receivable or be custom tailored to cover just your key customers. Lenders recognize that the insolvency of a company’s key customer may jeopardize repayment of a loan. Credit insurance reduces this risk.

Credit insurance usually costs a fraction of one percent of insured sales and premiums are based on the type of business, annual sales, loss experience and countries where goods are sold. Letters of credit, an alternative to credit insurance, are more costly and can tie up your credit lines.

Premiums for credit insurance can be factored into your export prices. Buyers are often willing to pay the credit insurance premium, since your credit terms are probably more feasible than a buyer arranging financing from a bank in the foreign country.

Once a credit insurer accepts your account, it will investigate the credit background of your customers using data from banks, trade organizations, government agencies, credit and rating groups, and from its own extensive files. It will also examine your company’s sales, credit history and shipment methods.

The detailed data and information provided by credit insurers can support your decision to establish credit limits for your customers. Sales to some foreign countries that have been designated by the government as “high risk” are not eligible for insurance, but these banned countries are small in number and change frequently.

Can an Auto Accident Affect Your Ability to Reinstate Your Policy?

In January of 2006, the Supreme Court of Vermont was asked to rule on a tricky question about the reinstatement of coverage under an automobile insurance policy. The plaintiff in the suit argued that her insurance company was responsible for covering a loss that occurred after her automobile insurance policy had expired because the company was aware of the loss when it offered to reinstate her policy retroactive to the expiration date.

Even though the insured received a renewal notice a month before the policy expiration date, she failed to pay her renewal premium on time. Consequently, the policy expired on August 13, 2003. Three days later, the insured’s car was in an accident and sustained major damage. The insured reported the accident to her insurance agent on August 18, 2003. She was told that same day that coverage was denied because the policy had expired.

However, the insured also received a “Final Notice” dated August 18, 2003 generated by the insurer’s computer system. The notice stated that the insured could reinstate the policy back to 8/13/2003 if she paid her premium by August 31, 2003. The insured paid the premium and the insurance company sent her an “Acknowledgment of Late Payment,” stating that the coverage under the policy had been reinstated and remained in force without interruption.

On August 27, 2003, the insured re-submitted her claim for the August 16th accident. In a letter dated August 29, 2003, the insurer denied coverage for the accident. The company said that the reinstatement of the policy did not provide coverage for the accident, and that the policy covered only unknown losses. The letter also stated that the previous denial of coverage had never been withdrawn.

The insured sued, saying that the insurer wrongfully refused to provide coverage for the accident. Her contention was that the insurance company could have withdrawn or changed its offer to reinstate coverage concerning the accident that occurred after the policy had lapsed, but it never did. The court that presided over the trial ruled in favor of the insurance company, finding that while an insurer may decide to cover a loss already known to it, there was no evidence that this insurance company made that decision.

The Vermont Supreme Court affirmed the decision in favor of the insurer. It stated that the insured could not show that the insurer was required to cover the accident because of its offer to reinstate her policy. In response to the insured’s argument that it was implied that the insurer had waived its right to deny the claim when it made the renewal offer, the Court noted that the offer to reinstate did not demonstrate any intention to reverse the previous refusal of coverage. It also added that the plaintiff couldn’t prove any change on the part of the insured’s position based upon its actions. The Court concluded that the insurer’s actions in this case were unmistakable in denying coverage for the claim. With regard to the insurer’s argument that insurance does not apply to losses that have already occurred, and that it was providing insurance coverage for future risks, the Court stated that this was somewhat inapplicable given the insurer’s prompt and proper denial of coverage without any change in that position.

In fact, it was this unwavering declining of coverage on the part of the insurance agent and company that seems to have been the controlling factor in the case. Regardless of the insured’s assertions to the contrary, the Court found nothing that suggested the insurer’s conduct would have led the insured to believe that she had coverage for the accident.

Study Shows Adults Aren’t Always Careful When Cooking At Home

The National Fire Protection Association reports that between 1999-2002, there were an average of 114,000 home fires associated with cooking equipment each year, resulting in 290 deaths and 4,380 injuries each year. The leading cause for these fires was unattended cooking.

In fact, three in 10 reported home fires start in the kitchen, and two out of three reported home cooking fires start with the range or stove.Electric ranges or stoves have a higher risk of fires, injuries and property damage, compared to gas ranges or stoves. However, gas ranges or stoves have a higher risk of fire deaths.

Because of these alarming statistics, The Hartford decided to commission Harris Interactive to create an online study of adults’ cooking habits to examine what factors were contributing to kitchen fires. The researchers questioned 2,527 adults, aged 18 and over during October 2006. Two hundred forty-three of those surveyed lived with at least one child under the age of five.

The study revealed questionable cooking habits that could increase the risk of cooking-related fires. Seventy-eight percent of those polled reported leaving an appliance such as a microwave, oven, or range unattended while cooking. One in five respondents reported leaving their house while the appliance was running.More than one-third of the respondents didn’t keep a fire extinguisher in the kitchen. 

The researchers noted that the overwhelming majority of respondents didn’t seem to know the safety rules to follow when preparing food at home. The following guidelines have been developed by The National Fire Protection Association to help families stay safe in the kitchen:

·                     Kids and pets should stay at least 3 feet away from the stove while cooking.

·                     Keep an eye on the stovetop while frying, grilling, or boiling food.

·                     Items that can ignite easily, such as dishtowels, curtains, or paper towels, are remain at least 3 feet away from the stove.

·                     Potholders or oven mitts should be within easy reach.

·                     Pot handles should be turned in toward the back of the stove to prevent spilling.

·                     If someone gets burned, pour cool water over the burn for 3 to 5 minutes.

·                     Be careful when removing cooked food from a microwave, because the hot steam can cause burns. Children should never use a microwave unless an adult gives them permission.

The ABCs of E&O Coverage

GL, PL, PI, BI, PD, K & R, EPLI, you name it.  The world of insurance can be a complicated maze of initials and acronyms, which are often seemingly used to confuse the insurance buyer.  Among the hodge-podge of acronyms, nicknames and “short-fors” are E & O and D & O which, when used together, have comfortably sunk into the industry lexicon as meaning anything and everything professional.

Errors and Omissions insurance (E&O) and Directors and Officers Liability Insurance (D&O) have certainly undergone change over the years.  D & O once referred to a distinct monoline (single coverage) product that protected the directors and officers of a corporation, usually publicly traded, against claims of malfeasance in protecting the interests of shareholders of the corporation.  In other words, directors and officers of the corporation are expected to use reasonable care in making decisions on behalf of the corporation, providing shareholders with maximum value.  Failure to disclose information to the public is a common allegation against directors and officers of public corporations.  Just think Enron.

Nowadays, D&O insurance is purchased by public and private corporations, and the menu of coverages available to corporations on a bundled basis is staggering.  Along with the D & O insurance you can often find Kidnap & Ransom (K & R) insurance, EPLI (Employment Practices Liability Insurance), and a host of others.

Often, E & O insurance can be purchased on the same bill as the D & O if the company provides a service that makes it eligible for E & O insurance, but typically, E & O is highly specialized and is purchased separately on a monoline basis.  That begs the question:  What is E & O?

Errors & Omissions, often referred to as Professional Liability Insurance or formerly called Malpractice Insurance, can cover professional and service providers across a broad spectrum of industries.  We’re all familiar with the trials and tribulations that doctors are facing today in the Medical Malpractice arena (or Med Mal if you prefer the “short for”).  Other professionals that carry this type of coverage include accountants, architects, engineers, and lawyers.  These classes are among the more traditional, but anyone who relies on specialized knowledge to provide a service is at risk of a lawsuit for which E & O coverage is available and essential in the litigious world we live in today.   Coverage is highly recommended for real estate agents, mortgage brokers, barbers and beauticians, morticians, travel agents, teachers, fitness trainers, printers, temporary staffing firms and recruiters.   Just about any kind of consultant, from computer to marketing to management consultants, and so on, needs the security of this coverage.  In fact, consultants are often required to carry the coverage by contract if their clients are midsize or large corporations.  This requirement provides one for companies to manage their risk.

Many people are under the impression that their General Liability Insurance, or in the case of a home-based business, Homeowners Insurance, will provide all the necessary coverage.  Not so.  These plans are appropriately designed to cover perils like bodily injury, i.e., a slip and fall in your office or on your property, but they are rarely capable of handling the kinds of exposure that E  & O covers, namely financial loss.  For example, if you are a real estate agent and you are accused of misrepresenting a property you have shown to your client, resulting in a bad decision with respect to the purchase or in some cases sale of a residential or commercial property, you can almost count on being sued.  Since the allegations have to do with the provision of expertise and the loss is a financial one, don’t expect it to be covered under the General Liability policy you purchase unless there is a specific rider.  Some insurance companies will include E & O coverage for a handful of classes such as printers or barbers/beauticians on a standard General Liability policy, but these are usually exceptions rather than the rule.

So if you feel that you may have an E & O or D & O exposure that is not currently covered, call your insurance agent today! That’s PDQ (pretty darn quickly)!

Save Money by Avoiding These Costly Insurance Mistakes

When it comes to purchasing insurance, fear is an important motivator. We are justified in our worries about protecting assets such as homes and automobiles, and we buy insurance to protect our financial integrity. Despite our best efforts, sometimes our insurance does not offer full financial protection. This is not necessarily because there is a problem with the insurance policy; it can be a result of human failure. When purchasing an insurance policy, many people fail to look at the true level of coverage that is necessary to restore assets to their pre-disaster conditions.

Below are five common insurance mistakes to avoid at all costs:

*Trying to do it all on your own – Shopping for insurance is complicated, and it is best to seek professional advice. While it is fine to use the Internet to educate yourself, you should ultimately work with an independent agent who can offer multiple options for your consideration. An agent will help you untangle the complex issues involved in purchasing the proper amount of coverage to meet your needs.

*Buying into the hype – If it sounds too good to be true, it probably is. Where insurance is concerned, you often get what you pay for. A company that promises large discounts is most likely offering less coverage.

*Slicing it too thin– In a difficult economy, many people try to cut their living expenses to the bone. While it may be prudent to cut out some of the “extras” we enjoy such as eating out and going to the movies, reducing an insurance policy is risky. If and when disaster strikes, you’ll be glad you didn’t cut back on insurance premiums, which can result in thousands of dollars of uncovered damages.

*Neglecting regular protection reviews – Consider how much your life can change in a short amount of time. For instance, has the value of your home gone up or down in the last few years? Has a new car been purchased or has a teenager just gotten their driver’s license? Has an adult child finished their higher education? These are just a few of the changes that can cause either an overlap or gap in your insurance protection.

*Restricting your options – There are quite a few insurance companies that advertise a “one size fits all” approach to insurance. In some cases, these companies do not have your best interests at heart. It is best to consider multiple options, rather than limiting yourself to one choice.

Preventing Fatalities from Work-Related Road Crashes

One of the least known facts about work-related fatalities and injuries is that motor vehicle crashes are one of the leading causes of death and injury in the workplace. The National Highway Traffic Safety Administration (NHTSA) observes that motor vehicle crashes kill more than 2,100 people while they are working and injure another 353,000. The average job-related motor vehicle crash costs an employer $16,500. 

Research conducted by The U.S. Bureau of Labor Statistics in 2003 discovered that crashes involving vehicles on public roadways were the leading cause of work-related fatalities. Crashes accounted for almost a quarter of all fatal work-related injuries.

Preventing employee roadway fatalities presents some unique challenges. The roadway is not a closed environment where conditions can be easily monitored. If employers want to prevent work-related roadway crashes, they must combine traffic safety principles and safety management practices. Employers can promote safe driving by providing workers with safety information and by establishing and enforcing driver safety policies.

It is fundamental to start by assigning a key member of the management team the responsibility of enforcing a comprehensive driver safety policy. An important part of that policy is enforcing the mandatory use of seat belts.

Workers shouldn’t drive irregular hours or for an excessive amount of time after their normal working hours. Workers should be instructed to never conduct business on a cell phone while they are driving. Insist that employees obey speed limits and follow applicable driving regulations.

Be vigilant in monitoring that workers assigned to drive on the job not only have a valid driver’s license, but also one that is appropriate for the type of vehicle driven. Check the driving records of prospective hires, and continue to perform periodic rechecks after they are employed. Maintain accurate records of each worker’s driving performance.

Employee education plays a vital role in any roadway crash prevention program. Educate workers on how to recognize driver fatigue and what strategies they can use to combat it. They should also be taught how to avoid in-vehicle distractions. Provide additional training to workers operating specialized motor vehicles or equipment in the correct procedures of operation. Place emphasis on the need for workers to follow safe driving practices both on and off the job.

It is also important that your vehicles offer the highest possible levels of occupant protection.  Be sure that part of your prevention program also involves implementing a structured vehicle maintenance program.

Use Technology to Make a Home Inventory

We purchase insurance to protect us from what might happen. Hopefully we go through life, never having to make a claim against our homeowner’s or auto insurance policies. We know that the monthly or annual fee is in our best interest, even as we hope to never need its services. Taking home inventory should be just as important. This worthwhile task is yet another method of protecting ourselves against something that may never happen, but could. Yet few people place as much importance on taking home inventory as they do on increasing their homeowner’s policy coverage. While most insurance agents inform their clients about the significance of taking home inventory, it is rarely performed. Homeowners may put the task on their to-do lists, but as time goes by, and their busy lives take priority, it simply never gets accomplished. The result can be a very expensive one indeed.

So now that I realize the significance of taking home inventory, how do I get started? At first glance, it seems pretty simple. Go through your home, room by room, taking pictures of your personal belongings and documenting their approximate value. No problem, right? The problem lies in Step 2: Storing your photographs and data. Unfortunately, for many people, Step 2 involves placing their beautifully detailed data in a storage box under their bed, or in filing cabinets in their home office. The files are safe and sound, until the house burns down, is burglarized, or gets filled with murky flood waters…rendering the information completely useless. This common occurrence is as ironic as it is sad. But in today’s technological world, it should never happen.

Now that you understand how technology can make taking home inventory as secure as it is easy, your next step is to find the best web site or software for your unique needs. Secure servers allow you to document all of your belongings and access them with ease, and they eliminate the need for a physical location in which to store them.

Important factors to consider when deciding on the most suitable home inventory site:

While many options boil down to personal choice, the options below are helpful regardless of your unique situation.

*Make sure your site or software allows you to quickly and easily select information about the products in your home.

*It is very helpful if the system is pre-populated with items, based on room and category. For example, Bedroom: Bed, Dresser, Night Stand, Lamp, etc.

*You may want to look at the total amount of inventory you have by room, or you may want to see items by category, or it’s possible you prefer a complete list of everything within your home. Look for functionality that allows all of these searches.

*And absolutely be certain that there is secure data storage within the web site or software. This cannot be stressed enough.

Below are some home inventory web sites to assist you in the process. I have listed them in no particular order, and included a short review of each.

This site provides free, secure online storage in an easy to use format. The system is very user friendly, not overly complicated. There is a guided tour to help you navigate the system, and a video tutorial if you are someone who learns by watching. The only thing I didn’t love about this site is that you have to actually sign up to get most of the information. There is a FAQ page, but it wasn’t as easy to find as on some of the other sites.

This site appears a bit “fancier” at first glance, but when you begin reading, it becomes apparent that it’s just as user friendly. In fact, I much prefer the FAQ page, which allows you to get a lot of information without first having to sign up. However, there is no video tutorial. This site is also free.

This site is very user friendly and provides a lot of information prior to signing up. It is also free. As with the other sites, Stuff Safe allows you to print and download reports quickly and easily. The FAQ page on this site is also easy to find and navigate. However, as with the What You Own site, Stuff Safe does not have a video tutorial.

In addition to helping in the event of a theft or disaster, a home inventory also helps you determine the appropriate amount of insurance protection. Even better, it can help you settle insurance claims faster. The actual task of performing a home inventory is quite simple. Basically, you should start with the most significant items (fine jewelry, electronics, furniture and family heirlooms, among others), and add the less expensive items, such as clothing, at the end. For every item you list, take a photograph, give a description of the item, list the date of purchase, approximate replacement value, and any other relevant information (such as serial number, make, or model). Upload this information to the home inventory software of your choice, and voila! You can rest assured that in the event of theft or disaster, you’ll be many steps ahead of the game when it comes to recovering your losses and getting your life back on track. 

Protecting Your Business from Natural Disasters with a Disaster Recovery Plan

Of the U.S. companies that are victim to a man-made or natural disaster, the Contingency Planning Research Strategic Corporation says 43% never reopen their doors and 29% are out of business within the following two years. A study by Touche Ross found that companies without a disaster recovery plan only have a 10% or less survival rate. Business owners should be seriously asking themselves whether or not they have an adequate recovery plan for disasters.

There are three crucial areas that all disaster recovery plans should cover:

1. Physical Resources

Of course, the physical assets of a business, such as equipment, electronics, office furniture, and the building itself, are things that usually can’t be quickly or easily replaced if they’re damaged during a disaster. The following are questions that an adequate disaster recovery plan should answer:

* Are there at least three days worth of emergency supplies on hand to carry the business immediately following the disaster?

* What steps can you, should you, and will you take to protect physical assets?

* How would physical assets hold up against various disasters – flood, hurricane, tornado, fire, earthquake?

* Who will assess the damage to physical assets following a disaster?

* Has a list been made to prioritize the replacement of key physical assets and what suppliers or companies should be contacted for the replacement?

* Is access available from an off-site backup system if data and electronics are damaged and how often should backups take place?

* How will important documents and records be kept secure and protected?

* Is an alternative facility an option to resume operations if the primary location is unusable and what location and type of facility would be needed?

2. Human Resources

All employers know that their employees are one of their business’s most vital assets. Therefore, employee safety and the resulting personnel issues that follow a disaster should be a top priority. The following are questions that an adequate disaster recovery plan should answer:

* Have all staff been adequately instructed on the disaster recovery plan?

* How will staff find safe shelter?

* How will contact be maintained with staff during and after the disaster?

* Are current contact numbers for all staff, vendors, suppliers, and clients available at an off-site location and how will this list be maintained and updated to stay current?

* Have staff members been identified to assume mandatory or key roles should other employees not be able to resume their roles?

* Are staff members assigned to form a crisis management team?

3. Operation Continuity

This component is about getting the business back up and running after the disaster. The following are questions that an adequate disaster recovery plan should answer:

* Does insurance, in particular business interruption insurance, provide adequate coverage?

* What amount of cash will be available for emergency contingency expenses?

* If the facility isn’t usable, then where should an alternative command center be located to coordinate the recovery?

* Is there an alternative list of suppliers to use in the event regular suppliers aren’t operational?

* What should be done for clients and customers during and after a disaster?

Employers might further assign specialized teams to be in charge of some of the tasks related to the above points. For example, a post disaster recovery team could manage recovery tasks like getting the business up and running quickly; an administrations team could handle areas like logistics, transportation, and emergency and survival gear; a public relations team could make public announcements and field inquires; a client/supplier communications team could advise vendors and clients of the business’s status; and an IT team could be responsible for software and hardware issues.

Remember, disasters can strike with little, if any, warning. Business owners can keep themselves off the wrong side of the statistics by being prepared and being able to get themselves up and running as soon as possible.

Available Discounts Can Lessen Your Auto Insurance Premiums

Personal automobile insurance can be expensive, but did you know that insurance carriers offer discounts that can ease the burden?  Ask your insurance agent about the types of discounts available. Keep in mind that not every discount listed below is available in every state or with every carrier:

Defensive Driving Discount – Reduce your risk of accidents by taking a defensive driving class, and many insurers will give you a discount on premiums. These courses usually last from 5 to 6 hours and train you to recognize road hazards and how to react in enough time to prevent accidents. The fee is about $20.00, but successful completion can earn you a 3-year, 10 percent discount on liability, medical payments and collision coverage.

Good Student Discount – Earn good grades in school and your carrier may reward you. That’s because statistics show that good students make better drivers because they are more mature and reliable. Many states allow a 5 to 10 percent discount if your student driver makes good grades, usually an overall “A” or “B” average in high school or college.

Good Driver Discount – Maintain a clean driving record, and you can save money. If a carrier’s risk is lowered, it will pass the savings on to you.

Home/Car Discount – Purchase both your homeowners and automobile insurance from the same carrier, and you may receive a discount of 10 percent or more, which will lower the premiums on both policies.

Multiple Car Discount – Insure two cars with the same carrier, and you may be eligible for a discount on both cars’ coverage.

Model-Related Discounts – Buy a car that has been assigned a high safety/anti-theft rating. Industry agencies rate every car model based on its collision history and the number of injury and theft claims associated with it. The higher the rating, the more probability of insurance premium discounts. Choosing a car with a lower rating can significantly raise a premium because of the higher risk factor.

Protection from Physical Damage/Theft – Choose options that protect your car from physical damage and theft, and you may receive a discount. Many insurers reward consumers who reduce risk by opting for anti-lock brakes, airbags, alarm systems and other security devices.

Low-Mileage Discounts – Use public transportation to commute to work, and your carrier may offer you a discount. That’s because the less time you spend on the road, the less of a possibility there is for an accident.

Can Your Car Insurance Survive a Storm?

With winter coming to a close, it’s time for many parts of the country to start preparing for tropical storms. Such storms can cause massive amounts of damage, not only to your home, but also to your car. Do you have enough auto insurance coverage to withstand that kind of destruction?

The Insurance Information Institute (I.I.I) says that even with comprehensive auto coverage, you may not be fully protected. Comprehensive coverage will pay for losses caused by fire, falling objects, catastrophic storms, vandalism, or animals. It will also protect your car against flood damage.

What you may not be aware of is that even with comprehensive coverage, your auto insurance does not automatically pay for a replacement rental car while your car is being repaired, or while waiting for an authorization from your insurer to purchase a new one.

That’s why it’s important to review your car insurance annually with your insurance agent to determine the extent of your coverage. It’s also a good time to talk about the need for additional coverages such as rental car reimbursement.

Here are a few more tips if your car suffers storm damage:

  • Report damage as soon as possible. If your car is not drivable, your agent or claims center may be able to save you time and money by having the car towed directly to the repair facility instead of to a temporary storage facility. In addition, arrangements may be made immediately to provide you with a replacement rental car, if your policy includes this coverage.
  • Know what your deductible is, as well as any additional charges you will be expected to pay before you authorize any repairs. Be sure your insurance adjuster, claims representative or repair facility appraiser reviews the damage with you and explains the repair process, including the use of original or generic auto parts.
  • Ask about warranties on repairs. You should also find out if your insurer has a repair facility referral program that offers a written limited or lifetime repair warranty backed both by the repairer and insurer for as long as you own your vehicle.
  • Do business only with a reputable insurer. Obtain insurance from companies that have a proven track record of handling auto insurance claims effectively. Get a referral or contact your local Better Business Bureau or State Department of Insurance.

Purchasing a Collision Damage Waiver on Your Rental Car Makes Sense

Although the fees can be considerable, it may be a good idea to purchase a collision damage waiver the next time you rent a car. You may believe you have enough protection from your Personal Auto Policy (PAP); however, that’s just not the case. Your PAP covers the lesser of the actual cash value of the car or the minimum amount to repair or replace it. Your contract with the rental car company may require you to reimburse them for the full value of the vehicle. You would have to make up the difference out-of-pocket. The PAP also does not pay for any increased value of new parts replacing old ones, or any diminution of value, meaning if the market value of the vehicle after repairs is less than that before the accident, you would have to make up the shortfall.

Another area where the waiver can be of great importance is in the settlement process. Your insurance company has the right to inspect and appraise the damaged car before repair or disposal.  However, the rental company is not bound by the terms of your policy, and it may opt to complete the repairs immediately. This would result in your not being covered because you didn’t comply with the terms of the policy.

The rental agreement may require immediate reimbursement for damages. Without the waiver, they could charge your credit card. This can create a significant debt and put you over your credit limit.

Rental agreements often make the renter responsible for any loss in value beyond normal wear and tear, regardless of the cause or who’s at fault. Your PAP doesn’t cover this contingency unless you insure at least one vehicle for both collision and other-than-collision coverage.

You could be responsible for the rental company’s loss of income on the damaged car. Your policy has limited coverage for these charges. The same is true for any administrative or loss-related expenses such as towing, appraisal, claims adjustment, and storage fees you may be charged.

Your PAP is considered excess coverage if:

·   Any coverage is provided by the owner of the auto.

·   There is any other applicable physical damage insurance.

·   There is any other source of recovery applicable to the loss, such as travel policies, credit card coverage, etc.

This can create a controversy over who pays, which can result in litigation. Keep in mind that many states have statutes that may govern this eventuality.

The PAP does not provide physical damage coverage for vehicles that are not private passenger cars, pickups, vans, or trailers. The use of covered vehicles is limited to the U.S., its territories and possessions, Puerto Rico, and Canada. If you rent a trailer, coverage is limited to $500.

The PAP may have limitations on use of vehicles that are not excluded by the rental agreement collision damage waiver. The PAP may also exclude certain drivers or may apply only to designated individuals. The collision damage waiver will probably also only apply to certain individuals, but operators for which no PAP coverage is available may be protected under the rental agreement by adding them as designated drivers.

The PAP will typically include a deductible in the range of $100-$500 or more. In addition, payment for damage to a rental car may result in a significant premium increase because of surcharges or loss of credits. Having a collision damage waiver will protect you from paying increased premiums.

Consider Preemployment Testing to Reduce Employee Lawsuits

Employees who sue their employers for discrimination, denial of workers’ compensation benefits, or unfair employment practices can harm a company, not only economically, but its reputation as an employer and a corporate citizen. One method being used more often by businesses to reduce employee lawsuits is preemployment testing. Implementing this process correctly can result in hiring employees who are not only best suited for the job, but by reducing employee lawsuits, you could lower the cost of your employment practices liability insurance.

Though preemployment testing has been proven effective in identifying individuals who are likely to file lawsuits, unfortunately, many employers fear they can be sued for just administering such tests. But, by vigilantly preparing and evaluating preemployment tests and conducting them uniformly, the practice can be a valuable, additional tool in selecting the right employees for your company.

Preemployment testing can include skills tests, endurance tests, physical agility tests, psychological tests, integrity tests, and educational proficiency exams. Employers with 15 or more employees are required by the federal government to monitor the impact of all tests – formal, informal, oral or written, objective or subjective – to insure that they do not negatively affect specific population groups.

Generally to be legally administered, preemployment tests must meet certain criteria. They must measure qualities and traits that have high relevancy to job performance; the content of a test must reflect the skills required to do the actual job; and if the test is designed to measure a certain trait or characteristic, determining the value of having such a trait must relate directly to job duties and performance.

Before developing preemployment tests or hiring a testing firm, you should determine if these tests are really necessary. If you find them necessary, you should meticulously document the reason you are conducting the preemployment test.  Keep thorough statistics to measure any adverse impact on specific populations, which could produce discrimination problems. Eliminate any test parts that are producing negative results.

Testing for disabled applicants demands that additional guidelines and restrictions be followed. Disabled applicants who have sensory, manual, or speaking disabilities must be administered tests that reflect their skills, aptitudes, and the factors required to do the job, and not their disabilities. Special arrangements must be made to test the disabled. Such arrangements may include providing a reader, sign interpreter, large print or Braille, giving the applicant more time to complete the test and making testing facilities easily accessible. Testing applicants for AIDS before and after a conditional job offer is not wise and could lead to serious legal difficulties, unless a genuine business requirement exists that would rule out a person with AIDS from performing the job.

According to a survey sponsored by the Chubb Group of Insurance Companies, 26% of executives at privately held companies reported an employee or former employee had sued their companies, and 22% reported having an employee file a discrimination or harassment complaint with the Equal Employment Opportunity Commission or other state agency during the past few years. Furthermore, 44% of executives said it is likely that an employee or former employee will sue their company in 2004, and 50% said it is likely that an employee will file a complaint with the Equal Employment Opportunity Commission this year. More than half the executives surveyed estimated it would cost more than $100,000 to settle an employment discrimination or harassment lawsuit. Ten percent said it would cost at least $1 million.

Conducting proper preemployment testing can not only reduce discrimination claims, but also help you hire productive staff, and decrease absenteeism and staff turnover.  If you have not already considered employment practices liability insurance, give us a call for more information about this important coverage.

Take Steps to Winterize Your Home Now

When preparing for winter’s arrival, most people immediately think of snow tires and protection from wet and icy roads.  But what about your home?  Although you may take great care in winterizing your car with snow-tires, anti-freeze, wiper fluid, flashlights and blankets, what kind of prevention have you taken regarding your house?  If your home is not properly winterized, it can easily become a source of both property and liability claims. Take steps to bring your home up to par before the first snowflake falls.

First, make sure your coverage is adequate to minimize the risk of a wintertime claim:

Winter Insurance Checklist

  • ·  Is your homeowner’s coverage sufficient?  If your house was recently upgraded, it may not be.
  • ·  Is your vacation property coverage adequate?  What if someone uses the property in your absence and is injured?  Will your coverage pay for damage that may occur while it is unattended all winter?
  • ·  Do you own a snowmobile?  Many high-end snowmobiles require insurance above and beyond what most homeowners think about.
  • ·  Are you planning a winter vacation that requires expensive items such as fine jewelry for a trip to France, or snow skis and equipment for Vail?  Be sure your personal property endorsements measure up.
  • ·  How about your college student?  Is he renting an off-campus town home?  If so, you should think about liability insurance for that dwelling, as well as all the winter hazards that apply to the family home.

Next, think about minimizing wintertime hassles, and avoiding needless claims that can be easily avoided.

Winterizing Checklist for Your Home

  • ·  Take time to clean or replace heating filters before turning the systems on.  Make sure your units have been professionally serviced.  If you don’t have smoke alarms, install them now. You may also want to consider carbon monoxide alarms.
  • ·  Inspect storm doors and windows.  Cracked gaskets or cracked glass?  Make the repairs.
  • ·  Remove or cover and seal window air conditioning units until spring.
  • ·  Examine the sidewalk in front of your house and all walkways and handrails to make certain they are in good repair. Maneuvering through snow and ice is hard enough without having to step gingerly on broken pavement or to remember not to grasp shaky handrails.  Also, having everything in good repair may help limit your liability in the event of a mishap.
  • ·  Is your snow blower and other snow removal equipment in good working order?  Hire neighborhood help to clear your walkways if you are unable to do it yourself.  Keeping walkways clear will help ensure that no one is seriously injured on your property by winter weather conditions.
  • ·  Check around doors and windows for cracks.  If you find small gaps, fill them in with caulk. Consider hiring a contractor if bigger problems surface.
  • ·  Remove leaves, acorns, sticks and other debris from gutters before the first freeze. This will ensure that heavy winter rains and snow melt can flow freely and not damage your roof or walls. You may also wish to install gutter guards to keep all that debris from getting into the gutters next year.
  • ·  Survey your plantings.  If snow covered branches would endanger any part of your house or cars, trim them back. Consider the walkway, too, so pedestrians will not risk injury while walking in front of your house during or after a storm. 
  • ·  Examine the insulation in attics, crawl spaces, and basements.  If too much heat is escaping, it can cause ice and snow to melt too quickly to be properly carried away.  If the melt off seeps into the roofing, it can cause significant damage or even collapse. If the insulation in your basement or crawl space is sufficient for your climate, you can avoid the inconvenience and damage of frozen or burst pipes.  In unfinished spaces with pipes running through them, such as garages, wrap the pipes with heating tape.
  • ·  During the winter, set interior temperatures to at least 65 degrees.  Letting indoor temperatures drop below 65 degrees could risk pipes freezing behind the walls.
  • ·  Learn where shut-off valves are for all plumbing.  Include both the valves within each room and the main valve.  If your pipes do freeze, the more quickly you turn off the water, the less chance of pipes bursting.
  • ·  And last but not least, take similar precautions with your vacation home. Make sure all pipes are drained and the toilet empty so expanding ice cannot crack the porcelain.

Where winterizing your home is concerned, the effort to prevent problems before they occur is well worth the expense! 

E-conomy, E-mail, E-coverage?

As companies expand the use of the Internet as an everyday business tool, they open themselves up to additional risks, including online copyright infringements, computer viruses, Web site business interruptions, and more. These problems leave companies open for potentially devastating financial setbacks.

Consequently, insurance companies are now offering policies that provide coverage for many Internet-related exposures. Intended to meet the needs of companies that have some Internet exposures (not dot-coms), the policies are expected to be available in more than 30 states this year. Most cover the following risks:

· Internet-related and advertising injury coverage protection for liabilities arising out of a computer network, including the Internet

· Worldwide coverage extending to the entire Web site, and including Web site advertising for others via banner ads and links

· Electronic vandalism for data damaged by hackers or viruses

· Virus damage and Web site vandalism that cover data and equipment damaged by viruses

· Coverage for business income and extra expense losses due to the alteration of a policyholder’s Web site

· Coverage for loss of income or extra expenses incurred because of an interruption in Internet service, Web hosting, or e-mail access

· Good faith advertising expense that covers advertising costs incurred to regain customer faith after a covered loss

Industry experts predict coverage for Internet-related exposures will be nationwide by the end of the year, but they caution policy buyers to ask questions and make sure they understand the policy before purchasing it. As with all insurance purchases, it is best to discuss coverage needs in detail with an insurance agent.

Insurance Coverage: To Consolidate or Not?

Keeping in mind that there are many types of coverage and each individual consumer will have different specific insurance needs, there may be several reasons to consider consolidating your various policies with a single carrier. For most people, the pros of consolidation usually outweigh the cons, but here are some points from both sides:


Consumers often find there’s a cost benefit in consolidating their coverage with a single carrier. While the exact number will vary from company to company, it’s very possible to save 15% or more.

Specialist companies still exist, but many generalist insurers have diversified their product lines to include an array of business and personal insurance and financial products. Since an insurance carrier is gaining customer loyalty and reducing their marketing costs when an existing customer purchases additional products, they’re usually willing to pass a portion of their savings on to their consumers.


Depending on the types of coverage you’ve purchased and your unique situation, certain coverage gaps could be reduced when you consolidate your insurance portfolio. Take purchasing General and Professional Liability through the same carrier as an example. An accountant, for example, would have little risk of their professional services leading to property damage or bodily injury, but a travel agent, for example, routinely makes professional recommendations that could have physical consequences for their clients. The travel agent might be unaware that a lodging they recommend to a client is undergoing renovations. The client slips and falls due to unsafe conditions and sues the travel agent for not knowing the condition of the lodging before recommending it. If the travel agent has General and Professional Liability through two different carriers, then he/she may find the two carriers pointing the finger in opposite directions and disclaiming coverage. Whereas, if the travel agent has both coverages under the same carrier, then the disclaiming concern is moot since there isn’t another company to point the finger at.


Many carriers have learned to anticipate the common problems associated with coverage gaps, such as in the example discussed above. These carriers have created tailored packaged policies or programs with multiple different coverage options. These options interlock, but don’t unnecessarily duplicate coverage or dangerously leave gaps between coverages. Umbrella policies perform best when written by the carrier of your primary coverage(s).


As with most everything in life, there are cons to consolidation. It’s important that you look at the financial strength of the insurance carrier. If an insurance carrier is poorly rated by any of the rating services that monitor insurers, then the increased risk of going with an insurer that has questionable financial strength may outweigh any of the cost, gap, and tailoring pros.

Another con is that the insurer may quickly change their hunger for a certain product and leave you having to find replacements for multiple policies. Research the company’s track record – have they typically stuck it out during bad and good times or have they timed the market to make a quick dollar and exit?

While most generalist insurers have diversified their offerings, it’s possible to miss out on some coverage benefits still only being offered by specialists.

In closing, consider the above points and how each could or wouldn’t meet your needs. In most cases, you’ll find that coverage consolidation and the right carrier creates a winning scenario for all parties involved.

Reducing Your Employees’ Exposure to Asphalt Fumes

Roofers are a pretty common sight, especially when the weather is mild. What we may not realize, however, are the health risks that are associated with working with hot asphalt. Roofers exposed to asphalt fumes may experience headaches, eye, nose, throat, and skin irritation, nausea, fatigue and drowsiness. These risks seem to be mild and transient.

But that’s just the tip of the iceberg. According to some studies, roofers may also have an increased risk of lung cancer; although there have been no definitive conclusions as of yet. If you add the possibility of looming cancer to the other less fatal irritation effects associated with hot asphalt work, it makes sense for both employers and employees to take steps to control exposure.

Before starting work, the contractor needs to ensure that workers have been properly trained in the hazards of applying hot asphalt and acceptable work practices. The contractor should also check that employees are using the appropriate personal protective equipment to reduce exposures to asphalt fumes.

Prior planning before work begins will help reduce workers’ asphalt fume exposure. Determine if it is possible to use a tanker to supply asphalt to the kettle or to the rooftop directly. If this is not possible, and a kettle will be used, place it where workers will be least exposed to the fumes. Keep the kettle away from air intakes, doors, and windows. Try to use roofing equipment and accessories that have lids to reduce exposure to fumes.

If possible, use an insulated kettle that is the right size for the job. It should have temperature controls and the right pumping capacity for its size. Inspect it to be sure that it is in good operating condition. Insulate the pipeline that delivers the hot asphalt to the roof.

Maintaining proper asphalt temperature is another way to reduce exposure to asphalt fumes. The equiviscous or application temperature (EVT), and the flash point of the asphalt can be found on the keg package or bill of lading. Once you have determined these guidelines, set the kettle temperature at the EVT plus 50°F. Periodically measure the asphalt temperature in the mop bucket. Make any adjustments to the kettle to maintain proper temperature. The appropriate temperature is the EVT plus or minus 25°F. The kettle temperature must also always be at least 25°F below the flash point to avoid fires and explosions. Use a hand-held or infrared thermometer to get an accurate reading.

Workers need to be trained to be continually mindful of safety when working with hot asphalt. They should place the kettle on firm, level ground to avoid spilling or tipping. They also need to be trained to put up warning tape, traffic cones, or signs around the kettle to keep others at a safe distance. They should reduce the number of times the lid is opened by filling the kettle to capacity when reloading. Workers should also check the temperature, stir, and skim when they reload. All workers must have, and know how to operate, a fully charged ABC-type fire extinguisher near the kettle.

During the actual application, workers should:

  • Keep lids closed on rooftop equipment and accessories used to transport and apply hot asphalt.
  • Stay out of the fume cloud whenever possible.
  • Use buckets with half lids.
  • Fill buckets only three-fourths full.
  • Carry buckets on the down slope of the roof.
  • Twist mops instead of pulling to unstick them from buckets.
  • Twist buckets instead of pulling to unstick them from the roof.
  • Minimize the time spent on their knees working with hot asphalt since exposures may be higher when closer to the fumes.
  • Use long-handled tools whenever possible.

Questions You Need to Ask Before Buying Distressed Commercial Properties

The economic downturn that began in late 2007 has taken a severe toll on all sectors of the U.S. economy, but it hit the real estate sector especially hard. Real estate research company Green Street Advisors reported in March 2011 that commercial property values were 17 percent below their peak in August 2007. CoStar Group reported that the values of the highest quality office buildings, relatively new retail and industrial properties, and apartment complexes were down 33 percent since June 2007. These large price decreases may attract investors in search of good buying opportunities. However, potential buyers should look beyond the low purchase price when they evaluate these properties. The properties’ physical state, legal issues, and insurance considerations also affect whether they are smart investments.

Many of these properties were only partially completed when the financial crisis hit, so buyers must assess their economic viability and physical condition. They need to ask:

* How much of the project has been completed and how much remains to be done?

* Does any of the work need to be repaired or redone because the builder, facing financial difficulty, took shortcuts in material quality or construction?

* Do the original construction plans comply with current building codes? Are there any design errors that need correction?

* Are there any significant changes the buyer would like to make to the project?

* What liabilities (debts, lawsuits, penalties, etc.) will the buyer assume with the property?

* Who will be legally liable for any defects in the design or construction of the project?

* If the original owner and builder are responsible for the problems, can the buyer recover from them?

* What insurance covered the original project? Did one program apply to the entire project, or did each individual contractor have its own coverage?

* Will the insurance apply to construction defects?

* If a single wrap-up insurance policy covered the project, did it include a deductible or self-insured retention? If so, and the insured owner or contractor has declared bankruptcy and is unable to pay it, will the insurance still apply?

* Are there special conditions that must be met before the policy will apply when the deductible or SIR cannot be paid?

* Does the original wrap-up policy extend completed operations coverage beyond the policy’s expiration date? If so, for how long?

Prospective buyers need to pay special attention to builders risk insurance on the project. If the original developer bought this coverage, the policy may have cancelled after work on the project stopped. A policy purchased by the general contractor may still be in force, but the buyer should review its terms and conditions carefully. Due to the long period of inactivity, vacancy and unoccupancy provisions may have taken effect. The buyer should also check to see if the policy covers catastrophic perils such as flood and earthquake; lost income and extra expenses resulting from delays due to covered perils such as fire or vandalism; and the extent of coverage for testing.

Regardless how low a property’s price may be, it is no bargain if it comes with a host of physical and legal problems. Arranging insurance on a property with severe problems may be very difficult or even impossible. An insurance agent or broker experienced in obtaining coverage for such properties can help sift through the issues and identify appropriate policies. There is no substitute for a careful examination of a property and all that comes with it. Buyers who do their homework will uncover the profitable opportunities.

Five Things You Should Know about Your Condo Association’s Insurance

A condominium unit-owner usually has her own insurance policy that covers her for loss of her personal belongings, parts of the building that the condominium agreement makes her responsible for insuring, the additional cost of living elsewhere after a fire damages her unit, and her legal liability for injuries or damages suffered by others. In turn, the condominium association has its own policy, which may cause some unit-owners to wonder why they have to buy separate insurance. Doesn’t the association’s insurance cover the same things that her policy does? Depending on the property at issue, the answer is maybe yes and maybe no. Insurance companies designed the two types of policies to complement each other in some cases and to overlap in others. Here are five things unit-owners should know about their associations’ insurance.

The association’s policy covers the building. Depending on the wording in the contract between the association and the unit-owner, the word “building” may mean several different things. If the contract requires the association to insure them, “building” can include fixtures, improvements and alterations that are part of the building and that are within a unit. For example, if a unit-owner installs new track lighting or an attached island in the kitchen, the association’s insurance would cover the cost of repairing or replacing them after a loss. Also if the contract requires, the association’s insurance will cover various appliances such as refrigerators, stoves and dishwashers.

The association’s policy covers personal property “owned indivisibly by all unit-owners.” Furniture in the building’s lobby, hand carts and other moving devices, and exercise equipment in an exercise room available to all residents are examples of the types of property that the association’s policy insures.

The association’s policy does not cover the unit-owner’s personal property. A unit-owner must buy her own insurance to cover her furniture, electronics, clothing and other belongings. Assume, for example, that the condominium contract requires the association to insure appliances. If fire damages a unit-owner’s space, the association’s insurance will cover the refrigerator but not the sofa. The unit-owner’s policy will cover the sofa. The association’s policy also does not cover an individual unit-owner’s legal liability for injuries or damages suffered by others. The unit-owner needs her own insurance to provide for her legal defense and to pay any judgments.

It is possible that both policies may apply to the same item of property. In the above example, both the association’s and unit-owner’s policies may cover the refrigerator. In that situation, the association’s policy will apply first; if it does not completely pay for the repair or replacement, the unit-owner’s policy will cover the balance. For example, if the cost of replacing the refrigerator is $5,000, and for some reason the association’s policy covers only $4,000, the unit-owner’s policy will pay the other $1,000 (the example doesn’t include deductibles that may apply.)

The association’s insurance company will not try to get its money back from a unit-owner. Suppose a unit-owner left a candle burning overnight and the unwatched candle caused a fire that damaged part of the building. Many types of insurance policies would allow the insurance company to pay its customer for the damage, then try to recover its payment from the person who caused the damage. However, a condominium association policy specifically states that the company waives its right to recover from a unit-owner. It still has the right to seek recovery from a person who is not a unit-owner and is responsible for the damage.

While comprehensive, the association’s policy is no substitute for a unit-owner’s own insurance. Unit-owners should work with professional insurance agents to ensure that they have the proper coverage.

Kidnap, Ransom, Extortion: Can It Happen to Your Business?

An Associated Press headline screams “Tape of beheading posted on web.”  It’s a sign of the times-as corporate executives, employees and contractors become pawns in terrorists’ arsenals worldwide.

Companies with international operations or employees who travel abroad face increased liability for the safety and security of their workers, not to mention the unexpected costs that ensue from a kidnapping. While some terrorists use kidnapping as a weapon in their “jihad,” or Holy War, money motivates most kidnappings. Demands for ransom and the related costs associated with managing a kidnapping crisis can run in the tens of millions of dollars.

Large global companies aren’t the only ones at risk. Small to medium-sized businesses can be victims of violence or extortion threats against property or product contamination perpetrated by disgruntled and/or former employees, as well as domestic terrorists.  The financial impact can be devastating.

Mitigating risk

A security firm can provide companies with advice and assistance in dealing with such threats. These experts can help businesses review their risks and take steps to mitigate them, such as:

·   Developing appropriate policies and procedures to deal with threats and emergencies

·   Enhancing the physical security of offices and buildings

·   Establishing a crisis management team to oversee planning and coordination

·   Providing cross-cultural, kidnap prevention, conflict-management, self-defense and survival training for workers going overseas

·   Engaging resources, such as the U.S. Embassy, to provide specific reports on safe places and areas to avoid in foreign countries

·   Purchasing Kidnap/Ransom and Extortion insurance

Insuring against the threat

Companies get a valuable combination of coverage and services with a Kidnap/Ransom and Extortion policy.  First and foremost, these policies provide broad protection from the financial loss associated with a kidnapping and/or extortion threats against the company’s merchandise, property, proprietary information, computer systems or employees.

Depending on the policy, coverage can include ransom payments, hostage-negotiating fees, consulting fees, loss of income, interest on bank loans taken out to pay a ransom, informant rewards, medical/psychiatric care for the employee kidnapped, as well as rest and rehabilitation costs, and accidental death or dismemberment payments. Corporate policies can even pay for interpreters, travel expenses and the cost of hiring a replacement.

Kidnap/Ransom and Extortion policies also offer policyholders access to a range of consulting services-from incident prevention to response resources.  Even those businesses that can afford to pay the ransom can benefit from the kind of services provided. Security consultants are available to assist with independent investigations, arrangement and delivery of ransom funds, mobilization of international resources, forensic analysis and family counseling.

Policies vary greatly. They come in a wide range of limits-from the $5 million to $10 million limit to $50 million. The premium rate is higher for coverage in risky geographic areas, such as those on the State Department’s travel restriction list, like Nigeria, Iraq and Indonesia, and may exclude some countries. High-risk areas include the Middle East, Latin America, Eastern Europe and Asia. 

Some policies are available with no deductibles, while others have large deductibles. In addition, policies may require that the policyholder not reveal the coverage’s existence. This is to prevent knowledge of the policy from encouraging a kidnapping or extortion plot.

With the threat of terrorist activities growing, companies large and small, particularly those that send employees overseas on business, should talk to an insurance agent about their risk and how to protect their human and corporate assets.

The Importance of an Annual Insurance Review

Most people know the importance of insurance protection. You don’t want to be without it when problems strike. What many don’t realize, however, is that protecting themselves with insurance isn’t a once and done event. You don’t wear the same pants you did when you were five years old because, besides no longer being in style, they simply don’t fit. A homeowner’s policy purchased when your house was furnished with bean bag chairs and bar stools is no longer going to “fit” once you’re lounging on Italian leather sofas while watching television on your wall mounted plasma screen. Life is constantly changing, and your insurance policies should reflect that.

Does this mean that I have to immediately call my insurance agent every time I buy a new piece of furniture or my cousin Gwen moves in for 6 months? Not necessarily. While more significant changes should be reported immediately (such as getting married or getting a new car), items such as improving your home entertainment system or upgrading your car’s tape deck to an mp3 player, can be reported at your annual insurance review. Agents reach out to their clients because they want to make sure to check up on these changes and make help avoid any gaps in their clients insurances, however it’s equally important to for a policyholder to reach out to their agent to make sure they are covered. Schedule your own annual review, and call your agent as you get your annual renewal. If one agent handles all of your coverage, this task is relatively easy. Jot down any changes that have occurred over the last year, even if you’re not sure whether they are significant enough to mention. Doing so will ensure that all of your insurance policies are best suited to your current life situation.

Some examples of changes that should be mentioned to your agent immediately are listed below. Ask yourself these questions every year:

*Have I gotten married or divorced?

*Have I had a new baby, or adopted a child?

*Is anyone in my house a new driver?

*Is anyone living with me who wasn’t before? Will they ever be driving any of my vehicles?

*Do I have a personal umbrella policy? Do I need one?

*Have I purchased any new properties?

*Have I started a home business?

*Have I purchased new furniture, electronics, or fine jewelry?

These are just a few examples of life changes that are often picked up during an annual review. However, they are far from the only changes that can affect your coverage, so be thorough when documenting and reporting items to your agent.

Some of the above examples might seem pretty obvious. Most people know that if their teen-ager gets his license, they need to notify their auto insurance carrier. However, not everything is as obvious. For example, take a couple who just had their first child. They decide that it’s time to purchase life insurance to provide for the child if something ever happens to them. This couple is doing the responsible thing. They understand the importance of buying life insurance when starting a family. That significant step in planning for the future is taught to the general public quite effectively, in the form of commercials, television shows, radio spots, and the like. But what about five years later when little Ellie is born? Having child number 2 doesn’t necessarily flip on the proverbial switch like the first time, shining that bright light on the right decision. Television shows don’t show “made for t.v.” couples updating their life insurance policies for child number 2. Advertisements don’t highlight the importance of adding new children as beneficiaries. All anyone ever hears about through popular culture is the importance of getting life insurance if you don’t have it, especially if you are starting a family. If the Henderson family gets a life insurance policy when their first little one is born, and 4 children later, mom and dad are hit by a logging truck on a trip to Alaska, only #1 gets the money. Unfortunately, #1 also happens to be 18 by that time, and decides to run to Vegas with his new fortune. This particular tale might seem slightly “tall,” but beneficiary issues create havoc, legal battles, and misdirected money on a daily basis. Sometimes it’s to the tune of thousands, other times it’s to the tune of millions. Protect yourself, your family, and your personal belongings by making sure that each of your insurance policies gets an annual check-up. You’ll rest much better once you do. 

Umbrella Coverage: Protect Your Exposed Assets

There’s no doubt that we live in a litigious society.  Jury awards continue to bankrupt individuals and many small companies.  Some trial lawyers constantly search for deep pockets, and reach far and wide for defendants.  Underwriters continue to be amazed to find seemingly unconnected insureds “invited to the dance.”

The most common protection for a business, or for an individual of means, to use against a crippling judgment, is an umbrella policy.  Umbrellas provide high limits of liability, usually with a small ($10,000 is typical-and this is sometimes waived) self-insured retention, above those offered by primary Commercial General Liability and Auto Liability policies.  Umbrellas may also provide coverage for certain losses not covered by primary policies.  Professional exposures such as Directors and Officers Liability or Errors and Omissions coverage, are excluded from “conventional” umbrella policies.  High limits for those risks are available from specialty markets.

How do you know how much umbrella coverage is enough?  While the question is best answered by information you’ll collect from your accountant, attorney and insurance agent, many company underwriters recommend buying limits of two to two-and-a-half times the value of your exposed assets.  Exposed assets are those that would not be exempt from liens or judgments, and a list of specific items may well be different for every insured.  For example, the deed to a wealthy individual’s primary residence might be in a foundation, blind trust or some other instrument that’s out of reach, but the vacation home, boat, stock portfolio, etc., might be exposed.

If that individual’s liquid net worth is $2,000,000, a $4M to $5M umbrella might be adequate.  There is some science, and some art, to making a decision on limits.  If you or your client is “luminous,” you might consider the exaggeration that will likely occur should you or that client be found at the defendant’s table.  A few years ago, a very successful professional tennis player, at the zenith of a stellar career, carried $50M in umbrella limits.  The player, unmarried and with no dependants to support, had five homes, nine cars, and significant other assets.  That player attracted a lot of notoriety off the court as well, and while celebrities are often the targets of frivolous lawsuits, our tort system can find that the same injury to an innocent party is worth more if it was caused by an individual of means.

A business, especially one with stockholders, has to answer the “adequate” question from an entirely different perspective.  Not only do physical properties, product inventories, valuable research, good will, cash, bonds, etc., have to be fully protected, the company’s value to stockholders must also be covered by adequate liability limits.  A stock certificate is owners’ equity, and a successful class action suit or an uninsured product recall campaign, could prove catastrophic to its value.  Imagine the aggregate costs if, say, a bug in a Microsoft product fried the motherboard in all those millions of computers that run its software.  Imagine the cost if, say, a hole in the AOL gateway gave someone with malicious intent a free ride through all the data on the PCs of their some 30,000,000 subscribers.  And high tech isn’t the only vulnerable industry-what if Dial soap suddenly made all our hair fall out?  Or what if Minute Maid (owned by Coca Cola) Orange Juice made us break out in hives?  The immediate and consequential dollar losses stagger the imagination.

Finally, the right number for an umbrella or excess limit is one you, your accountant, attorney and insurance agent and carrier(s) are comfortable with.  Remember that in some cases, plaintiff’s counsel has the right to know how much insurance coverage there is to pay a given claim.  Don’t buy so much that you make yourself a target.  Get the best advice you can, and buy limits that make sense and that you can afford.