Reduce Your Trick-or-Treat liability
The Trick-or-Treater’s will be knocking on your door tomorrow night! It’s your responsibility as the homeowner and insurance policy owner, to prevent losses. Halloween is a huge liability exposure. By decorating, turning your porch light on, and handing out treats homeowners invite some of the most common, and most expensive liability claims.
To make it simple, any injury that any person might suffer while their feet are on you property can be considered your liability. Take a few moments and consider these important issue before inviting the neighborhood to knock on your front door:
If you trip over the garden-hose everytime you walk to the front door, than don’t assume the little monsters own’t nearly break an arm when they trip over something on the way to your door. Be sure to move any obstacles from the sidewalk, driveway, and entry of your home.
Use only outdoor approved lighting and don’t place any lit candles outside of your home.
Be sure the area is well lit, and keep your lights on all night. Remember no matter how great the candy was at your house, Tricksters are still interested in causing problems. The best targets are dark homes where no witnesses will see the mischief!
Eggs are very difficult to clean off the side of your house, and even worse when they hit the hood of your car. If possible park you car in a garage Halloween night!
Be sure your pets are safely kept inside the house on Halloween. Not only are they at great risk of being frightened or hurt, but a dog bite claim is not what most of us expect when we’re handing out candy.
You might be able to save some money on your child dental costs, in many cities local dentist will pay by the pound for candy turned into to their office. But, that’s a downer to me so I prefer to Eat It All Up!
Most of all, be sure the treats you hand out are safe and individually wrapped.
Program offers pre-employment access to driver records
The Federal Motor Carrier Safety Administration is launching a pre-employment screening program for driver positions that will allow commercial motor carriers to electronically access applicants’ driver inspection and crash histories.
The program, which is intended to allow employers to assess safety risks of potential driver-employees, will begin in December, according to the FMCSA. Drivers will have the ability to verify their driving history and correct any discrepancies.
The information available to employers will include roadside inspection history, compliance review results, enforcement data, state-reported crashes, and motor carrier census data.
Drivers first must give written consent to have the records released.
“Increasing transparency by allowing greater access to driver safety records will greatly improve the hiring of safe commercial vehicle drivers and help raise the safety bar for professional truck drivers,” said Dave Osiecki, vp of safety, security and operations with Washington-based American Trucking Assn., in a statement.
RIMS issues insurance agency compensation report, revises stance
The Risk & Insurance Management Society Inc (RIMS), issued a new executive report Wednesday to help risk managers better understand insurance agency compensation and potential conflicts of interest.
In the report, RIMS said it hopes to heighten bussiness’ awareness of the potential pitfalls surrounding the insurance purchasing process, so they are “empowered to press for greater transparency” in their negotiations with agencies as well as regulatory reform in their own states.
The report came as the New York State Insurance Department prepared to issue new agency compensation disclosure regulations. As the rules stand now, agents and brokers would have to disclose their compensation only if asked by the insurance buyer—a position RIMS has criticized for not going far enough to protect consumers.
In the report, RIMS recommends that business owners and risk managers require full disclosure of the nature of all compensation earned by their broker in placing their coverage as well as any service relationship or financial interest the broker may have with the recommended insurers.
The report details the different types of insurance agency compensation in the market and gives examples of provisions risk managers can include in their request for proposals that address compensation issues.
RIMS’ members can download “A Practical Guide to Insurance Broker Compensation and Potential Conflicts of Interest for the Risk Manager” at www.rims.org.
How Big Of An Umbrella Do I Need?
The Umbrella Liability policy is still a relatively new type of insurance coverage for the average business. As recently as 30 years ago, it was seen as only needed by the very largest of business entities. Liability claims and court decisions involving millions of dollars are no longer uncommon; any business can be found legally responsible for this type of judgment. Most Umbrella Liability policies are in excess or “sit on top” of a businesses main liability coverages, mainly General Liability, Auto Liability and the Employer’s Liability part of Worker’s Compensation insurance.
How much excess liability a business owner should carry on her Umbrella policy depends on several factors. First, are there any contractual requirments from clients, vendors, franchisors or suppliers? It is common for these to require certain liability limits in order to do business.
Another factor a business should look at is the limits that other, successful companies in their industry carry. While this is certainly not an exact method for determining limits, it does provide a good guide to start with.
The final, and in my opinion most important, factor a company needs to look at in accessing how much excess liability insurance they should have is the amount of equity the business has. If you own a motorcyle dealership where the bank owns the building, the manufacturer owns all the inventory and all you have is $100,000 in tools, it doesn’t make much sense to carry a $5 million Umbrella. Conversly, if you own the building outright, own half of the inventory and $1,000,000 in tools and equipment, you would want a large Umbrella policy to protect your assets.
In the event of a lawsuit against a business, one of the first things the plaintiff’’s attorney is going to do is suponea the business’s insurance and financial records. A cynical person might suggest that the lawyer will look at the company’s assets versus their insurance limits to determine the size of the lawsuit.
Work Comp Cheaters Exposed
Worker’s compensation fraud investigators usually resort to field surviellance to catch cheaters, but some tech savvy investigators have been staking out social media sites such as MySpace and Face Book as well.
Some claimants supposedly too disabled to work post locations and dates for their upcoming sports competitions or rock band performances, boast of new businesses launched, and include date-stamped photographs of their physical activity, investigators say. Others have openly bragged about fooling their employers with Monday morning workers comp claims for injuries that occurred the weekend prior and away from the workplace.
For years, fraud investigations have relied heavily on video and audio recordings of disability claiments engaged in physical activities. Now, a lot of the scammers are providing the investigators the videos they need to sucessufully prosecute the case.
Social networking sites increase the efficiency of video recording and reduce investigation costs by eliminating time spent searching for claimants and waiting for them to engage in behavior that contradicts their claim, said Howard Schneider, president of Schneider Associates, a private investigative agency in Thousand Oaks, Calif.
To start with, investigators lacking a photograph or address to ensure they have identified the right claimant they were hired to tail might find a picture and address on MySpace, Facebook or other sites such as Twitter or classmates.com, investigators said.
Then there is the listing of physical activities.
In one recent case involving a Los Angeles-area warehouse worker who filed a work-related back injury claim, traditional surveillance of his home proved fruitless, Mr. Schneider said.
So investigators found the claimant’s Facebook site and learned about his participation in bowling tournaments and a bowling alley he frequented.
“It just amazes us how much information people provide,” Mr. Schneider said.
An investigator visiting the bowling alley found a large banner congratulating the claimant for rolling a perfect game and the date he rolled the game.
“Which was post date of loss,” Mr. Schneider said. The investigator video recorded the banner for evidence and later video recorded the claimant competing in a tournament. To do so, the investigator melded among spectators video recording their friends and family participating in the tournament.
“It was the easiest surveillance we ever had to do,” Mr. Schneider said.
To those of us who play by the rules, this is a great use of technology not a case of “Big Brother”. Fraud is one of the biggest causes of increased work comp insurance rates, and those increases get passed down to everybody in the form of higher consumer prices and lower wages.
Property Insurance Premiums Increase in First Half
Commercial property insurance rates increased during the first six months of 2009. This marks the first time in over five years that businesses have seen their property insurance premiums rise. The increase is due to the global financial crisis and past catastrophic losses.
Liability insurance rates for most industries remain competative and could even see some decreases for most industries. Directors and Officers Liability insurance for financial institutions remain an exception, with sharp price increases, shrinking inventory and stricter terms.
Hired and Non-Owned Automobile Insurance
Hired auto liability coverage will pay for damages to a third party, on behalf of your company, if you cause an accident or an injury to someone while you are driving a rented car or “non-owned” vehicle for business. For example, if you rent a car to visit a client, and cause an accident on the way there, the person you hit will look to your company to pay the damages. Without this coverage, your company may have no insurance coverage for a rented car.
The same scenario applies if you have an employee run an errand, or visits a client in his or her own car. When the employee causes the accident, the injured party is going to look to your company to pay for damages since the employee was using the car on company time. This can also apply if you casually ask a friend to pick up office supplies for you the next time they go to the office supply store and an accident occurs!
Novus ordered to stop selling surplus lines insurance in Michigan
The Michigan Office of Financial and Insurance Regulation has ordered surplus lines insurer Novus Centuriae Inc. and its managing general agency Core States Management Inc. to cease and desist selling insurance in the state.http://bit.ly/uj6Ir
Beyond Commissions – How Do Insurance Agencies Get Paid?
As many people are aware, insurance agencies are compensated by the insurance companies whose policies they sell. The most common form of compensation is commission, a percentage of the premium that the policy is sold or renewed for. The commission percentages can vary greatly between types of policies (property, auto or worker’s compensation to name a few) and between insurance companies. For example, XYZ Insurance Company pays an agency 5% commission on a work comp policy while ABC Insurance Company will pay an agency 15% commission.
Some other, not as well known, forms of compensation that insurance companies pay the agencies that sell their policies are contingencies, profit-sharing and incentive trips. Incentive trips are pretty self-explanatory; an insurance company will offer exotic trips to popular vacation destinations for meeting certain sales levels with that company. The profit-sharing or contingency type of compensation has become a somewhat contraversial recently, with the New York State Attorney General’s office outlawing the practice in that state. Contingency compensation involves the insurance company paying the agency additional fees on top of commissions for selling a certain dollar amount of that companies policies.
Arthur J. Gallagher & Co., one of the largest insurance agencies in the Country, said Tuesday that it has received approval from the Illinois Attorney General and the Illinois Department of Insurance to once again begin accepting contingent commissions on retail brokerage business beginning Oct. 1.
The Itasca, Ill.-based brokerage said it reached agreements with Illinois authorities on July 23 and July 27 that amend its 2005 settlement agreement, which prohibited the broker from collecting the incentive payments from insurers in most cases.
Illinois authorities accused the broker of steering business to insurers that paid the highest contingent commissions. Gallagher agreed to pay $27 million in client restitution to settle the investigation.
