Skip to main content
Monthly Archives

December 2013

WHY YOU NEED CONSTRUCTION LIABILITY

By Construction Insurance Bulletin

No matter how much care you take to keep job sites safe and finish projects according to specifications, accidents happen. Consider these scenarios:

  • an improperly installed kitchen cabinet shelf in a home you built collapses, injuring the owner
  • one of your employees posts a blog accusing a competitor of shoddy workmanship
  • a visitor to your worksite trips over an air hose, falls, and fractures her leg

To protect your business against the financial threat of costly litigation from such all-too-common mishaps, you need construction liability insurance.

This coverage will pay costs and legal expenses, up to the amount of the policy, for something your business did, or failed to do, that damages a third party, related to 1) your products or services (products and completes operations); 2) allegations of slander (personal and advertising injury); or 2) injury on your premises or job site (medical expenses).

As a common business practice, both residential and commercial clients will require you,and your subcontractors, to show evidence of construction liability insurance before starting a job.

In general, residential contractors should buy coverage two to three times the amount of the construction budget. Commercial contractors usually carry policies in the multi-million dollar range. Firms that face higher risk of damages, for example, roofing contractors or those in specialized trades, tend to have more coverage. Some contractors prefer to pay their premiums up front, while others make a down payment and finance the premium over the policy period (six months to a year).

No matter how large or small your business, having comprehensive construction liability insurance is always the best policy.

We’d be happy to review your situation and recommend the coverage that’s best suited for you.

GREEN MAY BE THE WAY TO GO, BUT HOW WILL YOUR INSURANCE APPLY?

By Construction Insurance Bulletin

Environmentally-friendly construction, also known as “green” construction, is increasing rapidly in the United States. Concerns about global climate change, U.S. dependence on foreign sources of energy, and rising energy costs are inspiring individuals and businesses to construct buildings with a reduced carbon footprint. This trend has important implications for settlement of insurance claims when green buildings suffer damage.

A green building is one that has met the requirements for Leadership in Energy and Environmental Design (LEED) certification. The U.S. Green Building Council developed LEED in 1998 as a way to help building owners identify and use practical and measurable designs, construction, operations and maintenance practices that are environmentally-friendly. Green buildings are, compared to standard buildings, more energy and water efficient, produce less carbon dioxide, and have a healthier indoor environment.

Some states and municipalities have begun to adopt building codes that require elements of green construction. California has imposed tougher water efficiency standards on new residential construction; New York City is considering more stringent energy-use standards for large buildings. The impact of these requirements on construction costs will vary by location. Green construction might require specialized materials and methods; in the near term, contractors with expertise in these methods may be relatively scarce. Therefore, in some places the cost of complying with green building codes could be higher than building with standard materials and methods, and that will impact insurance coverage.

(…continued)

The factors that will influence the claim include:

  • Whether the green building code applies to new construction only or also to major renovations.
  • What the code defines as a “major renovation.” Some codes might consider renovations affecting more than a specified percentage of the building’s area as a major renovation.
  • How will use of green building materials affect the building’s appearance? The property owner might lose enthusiasm for a repair if a change in appearance will lower the building’s market value.
  • How will the new materials interact with the existing building components? Will integrating the new materials increase rebuilding time and cost?
  • Are qualified contractors available in the area?
  • Will wait times for green contractors and materials result in costly project delays?
  • How does the building code apply in the event of a large natural catastrophe, such as an earthquake or hurricane? Must property owners meet the higher standards at a time when hundreds of properties have suffered damage?
  • After a catastrophe, will there be long wait times for contractors to haul away debris because of overwhelmed landfills and recycling centers? Will there be long wait times for building inspectors to visit and approve all of the effected properties?

Standard personal and commercial property insurance policies provide very limited amounts of coverage for ordinance or law” losses — extra costs incurred to meet local building requirements. Additional coverage is available; property owners in areas with green building codes should speak with our insurance agents about options and costs.

Research and publishing company McGraw-Hill Construction has predicted that the market for non-residential building retrofitting with green construction will grow to $15 billion by 2014. Property owners and insurance companies will have to address these questions much more often in the near future; the time to answer them is before the losses occur.

This is my big day?

By Personal Perspective

Your wedding day should be the happiest day of your life. You have been planning this day for most of your life. You and your fiancé wanted to have a white wedding in the mountains. Your lodge is reserved, the caterer is ready with the menu, the disc jockey has your playlist, and you have just picked up your gown. Everything is coming together beautifully. Even the weather cooperated. A little more than you were expecting.

A major blizzard hit your venue and there is no way anyone can go anywhere. You have to postpone your big day. The good news is that you have purchased wedding insurance before your big day so everything is covered and you can still have your white wedding without paying any additional out of pocket expenses.

Your wedding insurance covers these unforeseeable acts:

  • The venue. If your venue has any unavoidable cancellations from certain acts (such as damage) your wedding insurance will take care of you.
  • Any weather related problems such as inaccessibility, damage to venue, and many others. All the details including rescheduling the ceremony flowers, tent rental and reception food will also be covered.
  • None of your vendors showed up. Any number of reasons why a vendor may not show up and in that case, your insurance will cover it.
  • If you are called for duty or your job sends you off. Wedding insurance will cover the postponement of your wedding.

Give us a call when you are ready to take the plunge.

Will my homeowner’s insurance cover that?

By Personal Perspective

DO YOU HAVE ENOUGH HOMEOWNER’S INSURANCE

Not all homeowners policy cover everything the ‘what ifs’ of life.

Most homeowner’s insurance policies have gaps in coverage, which can get expensive in the case of any emergency. Here are just a few of them:

  • Earthquakes. Most homeowner’s insurance policies do not cover earthquakes. You will need a separate policy for coverage.
  • Floods. If you have a flood in your basement and no extra flood coverage, you’ll be paying for damages out of pocket.
  • A new building code? Your county passes a new building code and your house is not up to par. Only “ordinance or law” policies will reimburse your upgrades.
  • Did you cover your pipes for the winter? I hope so, otherwise any damages will be paid by you.
  • Fido. Due to certain breeds being labeled as ‘aggressive,’ not all types of dogs are covered under the homeowners’ policy, specifically Doberman Pinschers or Pitbulls.
  • Put your money in a bank. If you have money lying around your house and it gets stolen or damaged, the homeowners’ policy may only cover up to $1,000 of it.
  • Pools. You will need an umbrella policy to cover any injuries incurred around the pool area, since it is considered an ‘attractive nuisance.’

These are just a couple of the possible gap scenarios. There are many more. Make sure you contact our office for a complete review of your homeowner’s policy so that we can close the gaps.

That’s Not Me!

By Personal Perspective

“But he that filches from me my good name/Robs me of that which not enriches him/And makes me poor indeed.” – Shakespeare, Othello, act iii. Sc. 3.

Identity theft is a huge problem in the United States. Did you know that identity thieves stole approximately $21 Billion from victims in 2012? This equates to one incident of fraud every three seconds. That’s scary. In every minute, 20 acts of fraud occur. When you keep adding up the numbers it looks horrific. Most victims don’t know until it’s too late that they have become a victim of identity theft. If you are one of the victims of identity theft, we have listed a few things for you to do:

  • Contact the Federal Trade Commission (FTC) whether online or by phone, 877-438-4338.
  • If necessary, send mail certified and request a return receipt.
  • Contact your bank and let them know of the fraud.
  • Contact all of your credit card companies and credit reporting agencies (Equifax, Experian and Trans Union) and inform them of the situation.
  • Contact your insurance companies and make them aware of the theft.
  • Keep a detailed filing system. Keep all your originals, only send copies of originals to requestors.
  • Follow all deadlines. Keep a timeline of when you spoke to a person and set up a follow up date.

Following the above guidelines will help minimize any future thefts. We hope that you never have to use this list.

Protect your investment

By Personal Perspective

Not too many people consider their vehicle an investment, but it is. In fact it could be your most important investment. Your vehicle gets you to and from your employment. Your vehicle offers a safe and accessible way to travel.

As your investment, you take care of it. You put gasoline in the car. Diligently, you pay attention to the maintenance schedule for your oil changes and milestone check-ups. Rotating your tires, parking your car in a garage or a covered parking area, getting your car detailed, and other long term preventive measures are on your to-do list. You make sure your car is in tip-top shape.

Getting the right kind of car insurance should be on that list as well. Sadly, that is not the case. Many people like to get liability insurance to satisfy the requirements of the bank or the state. Realistically, however that basic coverage may not be enough coverage for expenses incurred in case of an accident. Liability insurance is basic insurance that only offers coverage for the other person in case of an accident. If you have damage to your vehicle and/or injuries you are out of luck.

Protect your investment and don’t skimp on auto insurance coverage. Get the best possible policy that covers your investment. Give us a call today to get a review of your auto policy so we can help you fill in the gaps.

START NEW EMPLOYEES OUT ON A SAFE FOOT

By Risk Management Bulletin

If your idea of orienting new employees is to introduce them around and show them the bathroom and the coffee room, think again.

New workers are five times more likely to suffer a lost-time injury on the job in their first month than those who are more experienced. According to the Safety.BLR.com Web site, two in five employees injured at work have been on the job for less than a year.

Why are “newbies” so vulnerable and what are you doing about it?

High injury rates are caused by a combination of ignorance and fear by workers and employers alike. New workers are obviously unfamiliar with the tools, conditions and (most important) safety hazards of the job. Many supervisors assume that rookies know more than they do. Certain jobs require taking precautions that newcomers have never considered.

The fear comes from new workers refusing to ask questions, so they won’t seem unable to do the job — and be vulnerable to termination. Questions also remind instructors of things that they didn’t explain fully or forgot to mention.

To encourage safe-mindedness on the job from day one, follow these guidelines:

  1. Make sure that supervisors keep reminding new workers that the more questions are asked, the better.
  2. Acclimate new hires to workplace safety as soon as possible through web site orientation and the new hire packet.
  3. Have supervisors incorporate safety information in their walk-through of the facility for new workers, pointing out such as the location of fire exits and extinguishers and, first-aid kits.
  4. Last, but not least: if you haven’t already done so, set up and monitor a comprehensive safety-training program for new hires.

To learn more, feel free to get in touch with the risk management professionals at our agency.

WORKER DOWN! WHAT HAPPENS NEXT?

By Risk Management Bulletin

Every year, more than 4 million workplace accidents result in injuries and illness. Quick and effective response at the scene of an accident can keep a bad situation from getting worse – and might even save a life!

In the event of a medical emergency, first-aid responders should follow these steps as soon as possible:

  1. Make sure the scene is safe. Warn employees not to rush into the scene of an accident before checking to make sure that it’s safe for rescuers to enter. Otherwise, you could end up with more victims.
  2. Call for help. An employee on the scene should call 911 while a trained emergency first responder tends to the victim. The employee on the phone should explain the type of injury, the exact location of the victim, and the caller’s phone number. The caller should stay on the phone in case the 911 operator has further questions. Because there’s no time to waste in an emergency and often no way to know how serious the emergency is, it’s important for employees to remain calm and act quickly and purposefully.
  3. Bring help to the victim. To prevent further injury, don’t move victims unless they’re in imminent danger.
  4. Check to see if the victim is breathing and has a heartbeat. If not, someone trained in CPR should try to keep the victim alive until EMS arrives.
  5. Do no further harm. Employees who provide first aid should be careful not to cause additional injuries in their attempt to help a victim. If they’re not sure what to do, they should do nothing except call for emergency medical assistance and keep the victim comfortable until help arrives. Doing the wrong thing could be worse for the victim than doing nothing. Employees should never try to do more than they know they can handle in a medical emergency!

Workers who aren’t trained in first aid or feel uncomfortable dealing with injuries can help by making the 911 call and staying on the line with the dispatcher; notifying a supervisor, the safety manager, and others; getting first-aid supplies; and/or meeting the EMS at the entrance to your facility and bringing them to the scene of the accident.

Keep workers who aren’t involved in emergency response clear of the area; and once the victim or victims are removed, cordon off the area to preserve evidence for the accident investigation.

 

WORKING ALONE: RISKY BUSINESS

By Risk Management Bulletin

As a business owner, you’re ultimately responsible for the safety and health of all employees – including those who work alone, either off site (traveling salespeople, telecommuters, etc.) or around your facility (such as security guards and night maintenance staff).

To help determine if these lone workers are safe, ask yourself:

  1. Does the workplace present a special risk?
  2. Is there a safe way in and out?
  3. Can one person handle temporary access equipment (such as portable ladders)?
  4. Are there potentially dangerous chemicals or hazardous substances involved?
  5. Does the job involve lifting objects too large for one person?
  6. Is more than one person needed to operate equipment or workplace transport safely?
  7. Is there a risk of violence?
  8. Are young, pregnant, or disabled employees at risk if they work alone?
  9. If the worker’s first language isn’t English, are there arrangements for clear communication, especially in emergencies?
  10. Is the worker medically fit to work alone?

Once these questions are answered, you can reduce the risk to your solo workers by:

  • Establishing a check-in procedure
  • Recognizing that some high-risk activities can’t be performed alone and providing a buddy system for these situations
  • Having the worker meet clients in a safe location if there’s a risk of violence
  • Instructing distant employees not to enter any place or situation that feels unsafe
  • Making site visits whenever possible
  • Staying in touch with the employee by phone, text, e-mail, webcam, or radio.

For more information, please free to get in touch with us at any time.

‘MY EMPLOYEES ARE HONEST – AREN’T THEY?

By Risk Management Bulletin

Smaller companies tend to be more vulnerable than Fortune 500 corporations to theft by employees.

According to John Warren, general counsel for the U.S. Association of Certified Fraud Examiners (USACFA), losses from internal theft are disproportionately high among small businesses. A nationwide USACFA review of more than 1,100 fraud cases found that the median loss in organizations with fewer than 100 employees came to $190,000 – more than half again as much as the $120,000 loss among companies with 1,000 to 9,999 employees.

Check tampering was the most common scam uncovered by the survey, followed by skimming (the theft of unrecorded sales), faked billing, and phony expense reimbursements.

One reason why small companies take a bigger hit is because employee theft is often hard to detect and can last over several years. Most perpetrators aren’t hardened criminals, but rather longtime, trusted workers who have risen through the ranks. “It’s startling how many times people will say, ‘I’ve known this person for 10 years, they babysat my kids,’ ” says the USACFA’s Warren, ” ‘Out of all of my employees, I would have never guessed this.’ ”

Embezzlement usually starts small and then escalates, often triggered by money problems facing the worker. Says one expert, “Any time you have an employee who has financial difficulties, you have the makings of a problem.”

their vulnerability, many small businesses don’t take basic steps to deter employee theft. “There’s a reluctance to think about this, compared to larger companies,” notes Rich Simitian, Southern California managing partner for accounting firm Grant Thornton. “The attitude is, ‘I’ve got too many other things to think about as a business owner.’ ”

We’d be happy to recommend precautions that can help you deter fraud internal fraud.