Entries Tagged 'Commercial Insurance' ↓

Rented and Personal Vehicles: Are Your Risks Covered?

Are you familiar with hired and non-owned auto (HNOA) insurance? If your business involves vehicle use in any way, this coverage could be crucial for your operations. Here are the FAQs.

What is HNOA insurance?

Hired and non-owned auto insurance provides coverage if an employee uses a personal or rented vehicle for business purposes. 

If an employee in these circumstances is in an accident, the company for which they were driving could be held liable for damages. HNOA insurance covers this liability.

Who needs HNOA insurance?

Business owners may assume that if their employees don’t use company vehicles, they don’t have to worry about insurance coverage. This isn’t necessarily true. 

The employee’s personal insurance may not always cover the full liability, in which case the litigators may go after the business for which the employee was driving at the time. This makes it important for any business with exposure to this risk to maintain HNOA insurance. 

While HNOA insurance is most commonly associated with food delivery tasks, the need for HNOA goes beyond pizza and sandwich delivery. Home health care providers, consultants, contractors, and anyone else who uses their own vehicles or rented vehicles for business-related tasks or travel have HNOA exposure. 

Of course, a company with a fleet of inexperienced teens delivering dinners will have a higher risk than a small business with two professionals who attend occasional client meetings. Still, the risk is there, and it should be addressed.

What can business owners do to reduce HNOA exposure?

To reduce their risk, business owners can take several steps. First, they can conduct motor vehicle record checks on employees. This task can be completed twice a year to monitor employee driving. Second, business owners can establish guidelines for who is considered an acceptable driver. The employer can use driving experience, age, and driving records as parameters to set these guidelines. 

Modern technology allows for a third method that could be worthwhile for some businesses. This solution is telematics. Using this technology, an employer can monitor the activity of a vehicle and the driver’s performance. The data will reveal whether drivers speed, how they brake, and other information that can be helpful in determining risk. Because they are being monitored, employees may make greater effort to drive safely. Employers can also create reward programs based on telematics data to further incentivize safe driving among employees.

Is HNOA coverage provided by a standard commercial auto insurance policy?

Business owners who have a commercial auto insurance policy may or may not be covered for HNOA situations. Previously, this coverage was often a standard part of commercial auto policies, but the rising frequency and cost of litigation have forced many providers to make it a separate policy. Business owners should check with their carriers to see what coverage is included and what is available.

What’s the next step?

If you’re unsure about your HNOA exposure and insurance needs, contact our office. We can provide a quick review of your policies and risks and make sure you have appropriate coverage.

Top 10 Small-Business Insurance Claims

There’s a common mentality among insurance policy holders: “It’s a fail-safe, but I probably won’t need it.” Perhaps it’s denial, or perhaps it’s part of a natural self-preservation mentality. For whatever reason, many assume insurance is “for the other guy.” Someone else may need to make a claim someday, but I probably won’t.

While it’s good to take steps to reduce the likelihood of claims, it’s also good to know that many small businesses do indeed rely on their insurance coverage for incidents. In fact, a study by financial services company The Hartford revealed that 40% of small businesses incur property or liability losses each 10-year period. What types of losses are businesses experiencing? Here are the top 10 insurance claims they make (and some tips on how to avoid them).

1. Theft: The top reason for small- business claims is burglary and theft. Some of these crimes are committed by outsiders. Others are the result of dishonest employee activity. Strong, consistent security measures and employee accountability can reduce the chances of these claims.

2. Water: Coming in second is damage caused by water from roof leaks, snow, ice, and frozen pipes. To minimize the risk of water damage, inspect roofing and plumbing features and perform maintenance regularly.

3. Wind: Hail and wind damage are frequent culprits when it comes to small-business damage. These elements can destroy equipment, buildings, and commercial vehicles. To protect assets, store vehicles and equipment indoors as much as possible.

4. Fire: Don’t underestimate the destructiveness of this force. Fire can cause major property damage and even wipe out a business. Always follow fire safety guidelines to ensure warning, extinguishing, and evacuation measures are up to date and fully operational.

5. Accidents: Customer slips and falls take the number five slot. Some businesses are more vulnerable to this risk than others. To minimize risk, keep interior and exterior walkways free of ice, water, debris, and damage.

6. Injuries/Damage: In addition to slips and falls, customers sometimes sustain other injuries or damage to their property. Establish protocols for creating a safe environment to reduce the chances of these occurrences.

7. Liability: Businesses that sell products run the risk of product liability claims. Perform proper testing before releasing anything to the public. Ensure consumer warnings and warranties are worded appropriately.

8. Objects: Some claims are the result of injuries caused by moving objects. Customers or employees may be struck by falling products, mobile equipment, or vehicles. Again, solid safety protocols can help keep your work environment accident-free.

9. Libel: A third party may sue a business for reputational harm. These claims resulting from libel and slander suits don’t account for a huge proportion of claims, but they still make the top 10. Businesses should use caution when mentioning anyone in media reports or marketing efforts in order to reduce the likelihood of libel claims.

10. Vehicles: Auto accidents complete the list of top small-business claims. To prevent these, small-business owners can enact a vehicle safety program. Proper training and qualifications for commercial vehicle operators is key. Is your business prepared for these incidents? Do you have the appropriate policies in place? If you’re unsure, contact your insurance provider to review your policies and make sure your company is covered.

General Liability vs. Professional Liability: The Difference?

Business professionals bear the burden of responsibility in two distinct arenas: general liability and professional liability. Both types of coverage are necessary to secure sufficient protection for your business. Here’s the difference:

General liability offers protection against costs associated with property damage, medical expenses, settlements, and slander.

For example, if a customer comes into your store, slips, falls, and sues your business for his medical costs, your general liability insurance will pay for these expenses. Another general liability situation would be a contractor who causes damage to a client’s home and is sued for repair costs.

Professional liability protects your business against claims that you did not do your job properly. In other words, any time you offer a professional opinion or perform a duty, you are professionally liable for the results and are vulnerable to lawsuits.

For example, an accountant who offers tax advice might be sued by a client who loses money after taking that advice. Another company might be sued after failing to file important documents appropriately.

Professional liability insurance is also called Malpractice Insurance and Errors and Omissions Insurance. When business owners hear these terms, they may assume this coverage is necessary only for doctors and similar professions. However, even an honest clerical mistake can be considered an error in professional services and result in a lawsuit.

To fully protect your business, consider holding both types of policies. My office can help you determine the coverage that is best for your operations.

Workplace Injuries: First Five Steps

An accident occurs at your place of business. Your employee is injured. What should you do first?

Your choice of response can take the situation in entirely different directions. Simple slips and falls can result in clear-cut claims or costly lawsuits. With the proper plan in place, you can achieve the former and avoid the latter.

If one of your employees suffers an injury, take the following initial steps to move the situation in the right direction.

1. Prepare: This step should already be completed before any injury occurs. It’s essential to have a plan in place for workplace injuries.

Your plan should be a written document that is posted for all employees to follow. Provide training to ensure everyone knows what protocols to follow in the case of an accident.

2. Examine: Assess the injury immediately. What type of injury is it? How serious is it? If you have any staff members trained in first aid, involve them in this initial examination.

For severe injuries, enlist the help of emergency medical professionals. For non-emergencies, speak with your employee about what medical care he or she may need in the immediate future, and decide on next steps.

3. Document: The incident should be well-documented. Remember that workplace injury plan you developed? You should have the proper forms readily available, and complete them right away.

Submit these to the appropriate parties, such as your insurance provider. Ensure proper forms are also provided for the employee’s doctor. The physician may need return-to-work authorization forms or temporary work restriction forms. This makes the process go more smoothly and keeps you, the employee, the insurance carrier, and the doctor on the same page.

4. Treat: Make sure your employee gets the medical attention he or she needs. An immediate visit to a clinic or an occupational health doctor will help establish the nature and extent of the injuries.

A delay can result in unnecessary complications, both physically and financially. Because of this, it can be helpful to establish an ongoing relationship with a specific medical facility or physician to handle any and all workplace injuries at your business.

The medical provider can have all your standard forms on file and remain familiar with your incident protocols. This relationship can help streamline the process for both you and the injured employee.

5. Follow up: Let the employee know you care about his or her welfare. Follow up to find out how the doctor visit went. Ask how your employee is feeling. Remove your boss hat for a moment and simply offer person-to-person concern.

Then, replace that employer cap and work with your employee to develop a return-to-work plan. Find out what else, if anything, the person needs from you to facilitate a full recovery.

Workplace injuries are never welcome, but following these crucial steps can make them less disastrous and keep the experience as positive as possible for all parties involved.

Your insurance agent can provide additional assistance with this process. With in-depth knowledge of workers’ compensation claims, your agent is an invaluable resource you should not hesitate to tap in these situations.

Take a Bite Out of Crime (and Your Insurance Premium)

Listing every potential crime that could occur against your business would be a daunting task. Small-business owners face risks from employee crime, nonemployee crime, and cybercrime. Any of these could result in claims that cause your premium to rise.

The good news is, you are not helpless against these crimes. There are effective steps you can take to keep your workplace protected against each type of crime. Putting these safeguards in place will prevent loss, injury, and increased costs. Help keep your business crime-free with the following tips:

Prevent Employee Crime

  • Vet your people: It may involve a lot of legwork, but it’s worth checking into the people you hire. Contact references and perform background checks for any potential employees. Be sure you are hiring trustworthy people.
  • Avoid violence: Do you have a written workplace violence-prevention policy? If not, develop a comprehensive plan that covers the consequences of committing acts of violence in the workplace and procedures to follow if such an event should occur.
  • Require audits: Reduce the opportunity for internal theft by requiring audits for all employees who handle invoicing, receipts, or payroll. These regular audits require extra effort, but the accountability can help prevent major losses.
  • Establish safety: Ensure every employee is properly trained on safety procedures and is aware of all company policies. Business owners who do not meet OSHA standards run the risk of breaking laws regarding safety regulations. Avoid penalty fees and lawsuits by remaining in compliance with all standards.

Prevent Nonemployee Crime

  • Use surveillance: Keep all areas of your business in sight. Use security personnel, mirrors, or surveillance cameras. Encourage employees to engage customers. A vigilant eye is helpful to protect your assets and avoid theft claims.
  • Install security: Apply physical security measures at your business. Install quality locks or a company-wide security system. Limit access to high-risk areas.
  • Light the way: Dark areas invite dark deeds. Ensure all areas of the property are well-lit. Add exterior lighting if none is present. Change all burned-out bulbs right away. Keep things bright and welcoming for employees and customers, and uninviting for crime.

Prevent Cybercrime

  • Back it up: Keep backup copies of all records either on additional storage devices or off-site. A loss of data could mean anything from a minor setback to a major cost. A large breach can spell disaster for a small company.
  • Monitor access: Limit the number of employees who can access all company information. Be especially prudent about access to finances and personal client information.
  • Be software smart: Use strong passwords and proper firewalls to protect your data. Remain current on software updates to keep defenses strong. Change passwords regularly. Negligence in these procedures can prove costly.

As you make these efforts, you will make your company safer, more inviting, and more cost-effective.

Is Employment Practices Liability Insurance a Must?

Employment practices liability insurance (EPLI) is a form of errors and omission insurance and protects your business against employee claims of discrimination, which could be based on age, sex, disability, race, or other traits. EPLI also covers suits regarding harassment or wrongful termination. In fact, as its name implies, its key function is to provide coverage if your employment practices are called into question.

If you’re the owner of a small to midsize business, you may assume this coverage is for large corporations. But bear this in mind: Although large corporations have hefty teams of lawyers on retainer to handle any employee lawsuits, it’s actually small and/or new business owners who are most vulnerable to these suits. As soon as you hire your first employee, this coverage becomes crucial.

Can you afford EPLI? The real question may be, can you afford not to have it? Claims and awards continue to increase, and you are at risk from discrimination claims in the same way as you are at risk from other types of liability claims.

Plus, EPLI may be more affordable than you think.

Its cost is based on several factors. The top variables include the number of people you employ, your turnover rate, your established rules and employee practices, and whether you’ve had any suits filed against you in the past.

Regardless of size, EPLI should be part of any company’s risk management plan. Discuss EPLI policy options and costs with your insurance agent, who can help you select the coverage you need.

Do You Need a Supply Chain Interruption Policy?

Is your business completely self-sufficient? If your operations are like most in today’s marketplace, you rely on the delivery of goods from others. While you may find these sources reliable, it’s possible their supply could one day fail. Are you prepared if the chain should break?

If materials or finished products are delayed, your business suffers. A significant delay or cancellation can cause a complete shutdown of operations. And lacking the resources it needs, your business could come to a temporary standstill or even close.

Many business owners underestimate the effect this supply chain failure can have. It’s important to note that it can take more than two years to recover, as this type of failure affects distribution, costs, service, and ultimately your bottom line. From small businesses to global corporations, companies need proper protection against broken links in the supply chain. The right insurance can’t stop the chain from breaking, but it can stop your business from doing the same. For proper coverage, business owners have two main options.

Option 1: Contingent Business Interruption Insurance

Contingent business interruption (CBI) insurance reimburses lost profits and extra expenses caused by the interruption of someone else’s business. Your company does not have to suffer shared damage for coverage to apply. The point of the policy is to provide for your business when your supplier can’t. This coverage is appropriate when:

  • You rely on a single supplier for materials.
  • You depend on one manufacturer for most of your merchandise.
  • You purchase the bulk of your products from one business.
  • You rely on a leader property (a neighboring business) to help attract customers.

While CBI offers helpful protection, it is limited. The policy only provides coverage if your supply chain is interrupted due to physical property damage at a “partner’s” business. If it has a fire, for example, you’re covered. However, if its employees can’t get to work due to road closures, you aren’t. In short, CBI doesn’t cover all perils or circumstances that could negatively impact your supply chain.

Option 2: Supply Chain Insurance

Supply chain insurance offers broader coverage than CBI. Like CBI, it covers disruptions to your supply chain caused by property damage to your supplier’s business. However, it also covers losses due to other events. Remember that fire that wasn’t covered by CBI? Did the thought of road closures scare you? Supply chain insurance offers a broader umbrella that includes these threats. This type of policy can cover:

Public health emergencies, natural disasters, industrial accidents, riots, labor issues, road closures, political upheaval, regulatory action, financial issues.

Make Your Chain Stronger

Obtaining the proper insurance coverage is essential to protect your business from supply chain risk. To determine which option is best for your operations, talk to your insurance agent and take the following steps to avoid making a claim:

  • Evaluate your supply chain. What risks and weaknesses exist? Do you need to make changes?
  • Identify backups. What other suppliers and vendors could you use in a crisis?
  • Create a contingency plan. This includes securing appropriate insurance coverage for your business.

Understanding the Legal Limitations of Liability Claims

Operating a business in our litigious society involves risk. A lost lawsuit can cripple or even bankrupt a company. If a product is deemed unsafe, the manufacturer’s reputation, as well as its finances, are at stake.

Liability coverage

There is insurance coverage available to protect your company. And there are also legal limitations to consumer lawsuits. Obtaining the right insurance coverage, plus having a good understanding of the law, can give you a big edge.

However, don’t rely solely on an understanding of the law. First and foremost, ensure your company is covered. You can’t predict when a lawsuit will occur, and even cases that are dismissed can result in costly legal fees. It’s essential to always have the right liability insurance for your company.

Legal limitations

Legally, consumers have a limited time in which to file a liability claim under the statute of limitations. This varies by state. All states allow at least one year to file, and many have two-year limits. Some provide three years, but few set it higher than four years.

The statute of limitations kicks in when the injury occurs or when the injured person discovers the injury, depending on state law. Some states impose “statutes of repose” that establish a second deadline for discovery.

The law, however, can’t protect you from being sued. So, if you offer products or services to the public, consult with my office; we can help you obtain the exact coverage you need. Fortunately, there’s no statute of limitations on good advice.

FAQs on Employee Benefits Liability Coverage

A good benefits package can enhance your business by attracting employees and retaining current staff. But there’s a downside: errors in the administration of benefits can result in lawsuits against your company. If this happens, your employee benefits liability (EBL) policy will kick in. How? Here are some FAQs on this important coverage.

What is employee benefits liability coverage? Employee benefits liability insurance protects your company against suits that result from administrative errors. If someone managing your employee benefits makes a mistake and this error results in a lawsuit, EBL protects you from the associated costs. These types of suits are not covered by general liability policies, making this additional coverage a very important add-on; EBL coverage is typically added to your general liability policy as an endorsement.

What kinds of mistakes? Employee benefits packages can be extremely complex. From life insurance policies to maternity leave, these benefits involve minute details and significant administration. When an error is made, affected employees can suffer major financial losses. EBL is available to cover these situations, including:

  • Descriptions of benefits and eligibility. When explaining coverage to your employees, you or your benefits manager may convey incorrect information, and the employees are more than likely to make benefits choices based on this erroneous info. This decision could cost them down the road, and they may hold you liable for their financial burden. If a lawsuit is filed because of your error, EBL has you covered.
  • Losses of electronic and/or paper records. Maintaining records of all benefit information is essential. If your HR department accidentally loses a benefit file, the loss could prove costly. If your employee suffers because this information is missing and sues you, your EBL insurance covers the costs.
  • Enrollment, maintenance, and termination of employees and beneficiaries. If your benefit packages are complex, it can be easy to miss a detail. One mistake on a form could omit an employee’s beneficiary from that person’s plan. Mistakes such as these are covered by EBL insurance.

What plans are covered? EBL offers coverage for a full range of benefits. These include insurance benefits, financial benefits, disability and worker’s compensation benefits, and other fringe benefits such as tuition reimbursement and maternity leave.

Who needs EBL insurance? If your staff includes a large number of employees and you offer a full benefits package, it’s wise to have this policy in place. If you have few workers and offer few benefits, you may not need it, although it’s always wise to check.

As the goal is to provide coverage against large claims by employees or their dependents should they suffer financial loss due to your mismanagement of their benefits, the size of your risk will determine the coverage required. When in doubt, discuss EBL coverage with your agent, who will help you review your insurance policies and decide whether EBL coverage is necessary for your business.

Mistakes happen. If they do, EBL can provide you with peace of mind. And it may prevent the unthinkable: a suit that will sink your company.

Technology Can Cut Workers Comp Claims

How much do you spend on workers compensation?

Between insurance premiums and claim payouts, this figure could be significant. But by improving safety measures in your business, you can significantly impact this cost.

To keep these expenditures down, many business owners are turning to technology.

Today’s tech often gets a bad rap (“Employees are on their smartphones instead of working.” “Robots are stealing jobs.”) But technology can also prove useful in making work environments safer and reducing costs. Following are a few tools that business owners can implement in their company operations to cut risk. The results should be lower insurance costsĀ and safer employees.

Instant access – Upload manuals, instructions, and safety reports to your company website, and allow employees to access this information easily on tablets and phones while on the job. They can quickly reference the appropriate procedures for potentially dangerous situations. In case of an accident, they can easily and instantaneously complete required reporting.

Apps – Most employees now carry smartphones, and many apps are available to boost on-the-job safety. With the addition of a few apps, a smartphone can also be a flashlight, a level, or another tool. Does your business have a unique need? Work with an applications developer on the perfect app for your employees to make their jobs easier and safer.

Cameras and video – Surveillance cameras can help protect against break-ins and theft, but portable cameras and videos can do so much more. They can record safety walk-throughs for future reference and review, take pictures of hazards to report them, and photograph accident sites for accurate, instant reporting.

Drones – In addition to handheld or hard-hat-mounted devices, drones are great tools for photographing or recording a worksite for safety evaluation. Reviewing these images allows analysis of risk factors that could pose safety concerns or cause errors.

Personal sensors – Like boots, hard hats, safety harnesses, and vests, sensors can be used as personal safety equipment. These can let employees know if they have been standing too long or their heart rate is too high.

Site sensors – Sensors can be set up in at-risk areas of worksites to detect specific safety concerns: they can alert employees if they are in an area where it’s too hot to safely work, or alert them to potential hazards ahead that may cause slips or falls.

Self-driving vehicles – Unmanned trucks and cars are still a fairly new idea, but are quickly gaining acceptance. Construction crews in particular are interested in applying this new technology. Drivers of roadwork vehicles are often in danger of being struck by passing traffic. Removing drivers from these trucks would eliminate this safety hazard.

What technology could benefit your business? A quick review of your recent incidents may reveal where you need to beef up safety protocols. Once these at-risk areas are determined, consider what technology could improve employee safety in those situations. Spending a bit on technology could save you a bundle on your workers compensation claims.