Archive | February 2014

Car Insurance for the Self Employed

selfAs a self-employed business owner, you may need additional car insurance. It all depends on a several factors. Whether you work at home and never leave the house or you use your car for an office, you do not want to wait until you have a claim to find out that your personal insurance policy does not cover business uses.

I have good insurance!

You may have strong personal car insurance, but it may not cover your business related driving. Most individual or family car insurance policies specifically exclude liability for events arising from an accident that occurs in a car being driven for business – your fault or not.

  • Example #1- Your teenager drives your pick-up truck for your landscaping business. If your teen is in an accident and reports the claim, he will be told there is no coverage.
  • Example #2 – You are a stay-at-home mom running an online business or a florist with three locations. If the mom is involved in an accident on the way to church, her accident will be covered, but the florist will not be if his personal car is damaged on a trip between stores.

Your personal car insurance will not cover your vehicle(s) if:

  • The vehicle is used to transport commercial goods
  • The vehicle features work-related equipment, tools, and fixtures
  • The vehicle as a matter of course transports people.

So, depending on how you use your vehicle, you may want to investigate the value of commercial car insurance with a credible commercial insurance professional.

Ask yourself a question –

You may need commercial car insurance if:

  • Any of your vehicles serves as a taxi or limo
  • Employees or drivers – not listed on your insurance policy – regularly or occasionally drive your vehicle
  • Any of your vehicles pick up or deliver goods, supplies, or materials
  • Your vehicles are leased or rented to others
  • Any vehicles are owned or leased by your partnership or corporation
  • Your vehicles are equipped with cooking or catering equipment, snowplows or hydraulic lifts
  • Any vehicles have permanent tool boxes, ladder racks, or refrigeration equipment
  • Your vehicles are registered or titled to a business entity

What’s the difference?

Your liability and potential liability increase when you use the vehicle(s) for daily operations. Obviously, if you transport people as part of your business and/or damage and injure people in other vehicles, you present yourself as a deeper pocket than an individual. And, if you own several vehicles or lots of equipment, you need the assurance that there is broad liability coverage.

Businesses have issues that individual drivers do not have. To meet those obligations, commercial auto insurance will:

  • Provide considerably higher liability limits
  • Extend the liability coverage to any new vehicles purchased or hired
  • Cover the cost of renting a car while replacing an inoperable vehicle
  • Consolidate vehicles and equipment under one deductible
  • Protect you and employees while driving non-owned vehicles

At what cost to me?

Your insurance premium may go up, down, or stay the same. But, you must tell your insurance specialist, or the cost to you may be very significant. Any increase in cost to you is a small price to pay for confidence and assurance that your vehicles and contents will be covered when your risk increases because:

  • Your business puts you on the road frequently or over long distances
  • Your vehicle(s) carry large or pricey items
  • Your vehicles are on a frequently stolen vehicles list
  • Your business needs increase the number of vehicles

In the insurance world, when risk increases, so may the premium charged to you. Start now to work with your insurance pro to determine your business needs and manage those risks.

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Why is Car Insurance So Expensive for Teen Drivers?

teen car insuranceDid you know that approximately 20% of teen drivers involved in fatal car accidents reported having high levels of alcohol in their systems? Motor vehicle fatalities are still the leading cause of death in teenage populations, accounting for about one-third of overall fatalities – as well as other risky driving behaviors.

Recently, talking or texting on a cell phone has been implicated in further distracting already inexperienced young drivers. Perhaps this is why teens account for 14% of reported crashes while comprising less than one-tenth of the driving population.

Top Risks for Teen Drivers 

Although by the time young drivers take their driver license photo they have heard phrases like “speed kills” and “don’t drink and drive” ad nauseam, teens frequently succumb to the dangers of risky driving. According to research out of Temple University, the brain systems involved in complex decision making evolve slowly throughout the teenage years and can, therefore, increase the chances of teens engaging in risky behaviors behind the wheel.

These findings perhaps explain why teens are resistant to pleas from educators and awareness campaigns to resist texting, playing with the radio or consuming alcohol and getting behind the wheel. In fact, that same research from Temple University showed that the impulse-governing part of our brains isn’t fully developed until age 25, which partly explains the trouble teens have with curbing risky behaviors like texting. Oftentimes, teens know the correct behavior intellectually but don’t have the restraint to act upon that knowledge and eschew reckless behavior.

Higher Insurance Rates for Teens 

Insurance companies say that teens have higher rates because of driving inexperience and immaturity. The latter can often lead to taking unnecessary risks or just not understanding the correct thing to do in every situation on the roads. Statistics show that a 16-year-old driver is 250% more likely to get into an accident that a 24-year-old driver with more experience.

The tendency is for rates to rise until around age 25 and then gradually decline throughout an adult’s driving life, or until age 70. That said, multiple crashes and tickets can preclude an eventual reduction in car insurance coverage or affordable rates. Educators and parents alike should stress the importance of following the rules of the road at all times and forgoing risky behaviors like texting, calling and fiddling with the radio while driving.

Teen drivers often face high premiums due to the fact that insurance companies usually have to pay out more on claims. A reputable driver’s education curriculum, and qualifying for rate reductions based on good grades and accident-free driving, can reduce rates for teen drivers. Parents would also be wise to add teens to their existing policies and take advantage of multi-car insurance discount packages.

Interestingly, vehicles that are frequently broken into or have notoriously high repair costs are costlier to insure, especially for new drivers. Contacting an insurer beforehand to lock in an affordable rate is a wise move. This shouldn’t be purely economic, however, as teen drivers prone to impulsive, perhaps reckless, driving might be safer with a sedan and a high safety rating versus a hard-to-insure sports car. That said, seatbelts, airbags and newer safety features can bring down insurance rates; so that hand-me-down clunker may not be the easiest car to insure.

Summing up, teens face higher insurance rates than older drivers because of inexperience, immaturity and proneness to accidents.

Cyber Risk & Supply Chain Management

cyberSupply chain management involves the coordination of the flow of goods, from the transaction and storage of raw materials, to checking inventory and shipping finished products. Supply chain weaknesses are one of the biggest threats facing businesses – particularly those involved in manufacturing or retail. Cyber risks can undermine effective supply chain management, with research showing that disrupting a supply chain cuts the share price of the affected company by an average of approximately ten percent.
Bearing in mind that international supply chains (and transport infrastructure) are the skeleton of economic growth, trade and the basic functioning of an increasingly interconnected global economy, anything that can reduce cyber risk has an economic payoff.

What are cyber risks and how do these risks impact supply chains?

For the last few years the Supply Chain Risk Initiative, spearheaded by the World Economic Forum, has sought a deeper understanding of the systemic vulnerabilities to international supply chains and transportation channels. The initiative urges companies around the globe to shift from a reactive stance against cyber risk to proactive steps to risk management.
Supply chains can be disrupted by external threats or systemic shortcomings. External threats include things like demand shocks and natural disasters, whereas systemic shortcomings include things like information fragmentation and cyber risk. In fact, the escalating cyber risk to supply chains has caused over four-fifths of companies to emphasize the resilience of supply chains, according to research conducted by Accenture.
What are the factors that inform and can help mitigate systemic risks like cyber risk?
Cyber risk can be mitigated to protect supply chains by:
• Tightening the security at every step along the supply chain;
• Creating resilience in strategy, partnerships and information technology
Benefits to Addressing Supply Chain Risks
Of course, the economic ramifications of cyber risk and systemic vulnerabilities to supply chains vary by the industries in which they take place. A company that leans on logistics, for instance, has different risks. Irrespective of the industry in which cyber risk occurs, however, cyber risk can usually expose customer accounts and intellectual property in a way that puts company finances and reputation in permanent jeopardy.
Research from Zurich shows that over half of disruptions in supply chains accrued because of information technology or communications shortcomings between suppliers and buyers. This finding highlights the importance of curbing systemic vulnerabilities and cyber risk at the beginning of the supply chain especially. That said, risks at all levels should be addressed because information technology pervades every step along the supply chain ladder.
Unfortunately, these systemic vulnerabilities to supply chains are expected to increase as the US economy and global growth once again accelerates. While companies should understand the risks of external threats, the lion’s share of future cyber risk will come from systemic failures to secure customer data and proper IT functioning at all levels of the supply chain.
Checking that each vector of your supply chain is airtight and trustworthy is an important ingredient in significantly reducing cyber risk. Addressing shortcomings in vendor management can also reduce cyber risk and systemic vulnerabilities – producing growth as an offshoot.
Being proactive in combating systemic vulnerabilities is essential in cutting down losses in share prices due to supply chain disruptions; moreover, addressing systemic vulnerabilities now rather than after-the-fact will spur growth, trade and expansion.

Discrimination Against Spanish Speaking Employees: What’s the Risk?

Speaking-SpanishOwning or managing a business carries with it several liabilities and potential risks. Most businesses focus on the aspects of property damage, fire hazards, employee safety, and other prominent causes of lawsuits and loss. A silent threat that is often ignored, or taken for granted, is discrimination and harassment in the workplace. The liability for these cases can be just as costly to the business as if there were a fire or other damaging incident.

One of the many freedoms that is savored by the American people is the right to not be discriminated against. Discrimination can come in a number of forms and the scope is being widened in response to public outcry. A case in point – in July 2013, discrimination against Spanish speaking employees found its way into a legal battle which is playing out in New Mexico.

As an employer, you are placed in a sensitive position when you have Spanish speaking employees and a need for English to be spoken at the workplace. The U.S. Equal Employment Opportunity Commission has set forth laws which include discrimination or harassment based upon the employee’s national origin, accent or use of another language besides English.

It has been alleged in the case brought by the American Civil Liberties Union of New Mexico that when Whole Foods had placed a sign and instituted the directive their employees were to use English only while at the workplace, it was discriminatory in nature. Their case is rooted in the belief that there was discrimination against Spanish speaking employees, despite the notification being universal in nature and stating, “English-only”.

Requesting an employee to use English only in the workplace is considered a violation of the rights afforded under Title VII of the Civil Rights Act. It can be a difficult matter to address, especially for employers who have others within their staff, or clients, that are made to feel uncomfortable when there is a use of a language they are not familiar with. It raises a serious question of effective work performance and safety for employers and employees in a workplace which encompasses English-only speaking clients and staff.

The EEOC acknowledges that there is a need in some instances to request English-only in the workplace. The practice however is severely restricted by:

  • Not including employee breaks or other personal time while at the workplace
  • Only includes circumstances which are required to maintain a safe and functional work environment
  • Disciplinary action can only be taken after adequate notification of the violation and consequences thereof

Language, for many, is considered an integral part of their heritage and a major contributing factor to their personal being. Being asked to place that part of their self on hold while at a work can be construed as not only offensive, but discriminatory.

It is a subject that will continue to draw attention and debate from the side of an employer who has English speaking clients and employees, as well as from the employees who speak more than one language. Discrimination against Spanish speaking employees as evidenced in this legal battle will certainly continue to be an important risk of which all businesses need to be aware.

Tips to Prevent Winter Damage to Your Home

winterThere is a lot left in this winter.

The polar vortex is come and gone – but not forgotten. The damage may be done, but there are months left in the winter to suffer through. Winterizing your home, even at this late date, will save you money and can prevent costly damage.

Here are a few things you can do now to protect your home from damage caused by freezing temperatures and winter storms.

1.  Protect your pipes

Home insurance companies know that the biggest risk to your home during the colder months lies in frozen pipes. Water sits in pipes ready to rush through the open faucets. The water in pipes that lie in walls that exposed to the outside cold, the most obvious being those that lead to outdoor hoses and spigots, is particularly susceptible to freezing during cold weather.

If that water freezes, it expands and breaks the pipes, and when it thaws, you have a major leak on your hands. To prevent the damage in advance, shut off the valves controlling the water to those pipes and, then, drain them and leave any hose connections open. You can also cover the outdoor spigots with commonly available styrofoam protectors. Finally, you should insulate pipes that run through uninsulated spaces like basements or crawlspaces with fiberglass wrap or pre-molded sleeves.

2. Replace furnace filters

During the winter, it’s a good idea to change furnace filters throughout the house. Clogged or dirty filters will reduce airflow and make your heater work harder than necessary. The best and most thorough of furnace filters cost more, but the cost savings and improved air quality are worth the investment.

3.  Check the furnace

While you are changing your furnace filters, you should consider securing a maintenance agreement that cleans and tunes the furnace at least twice a year including once before the winter. With forced air heat, the ducts will lose heat if they are not well insulated and connected. The maintenance provider will seal gaps, vacuum out the dust, and insulate the ducts running through uninsulated spaces.

4.  Program your thermostat

Install and program a state-of-the-art thermostat. Lowering your thermostat by one degree can save you up to 3% on your heating bill. Lowering the hot water heater from the standard 140°F to 120°F will save you up to 10% of your heating bill. In the long run, you may also consider installing a tankless water heater or solar heat.

5.  Block the drafts

Caulking and weatherstripping indoors and out are short-term solutions to ward off the winter cold. But, consider the return on investment in new or replacement storm windows and doors, pet doors and electrical outlets. Door sweeps attach to exterior doors to close the gaps between door and frame. Outlet gaskets insulate electrical outlets.

6. Insulate, insulate, insulate

Roles of insulation can be purchased at any big box hardware center. In areas that experience cold winters, homeowners should install at least 12-inches of insulation in the attic. This not only helps keep your house warm. It can also prevent the formation of ice dams that cause roof damage. The good news? Laying insulation is a project you can do yourself. Boosting your insulation may also make you eligible for Federal tax breaks.

7.  Clean the gutters

When rain gutters fill with leaves and debris, they block water flow and create conditions that could cause freezing. When the water freezes and blocks the drains, additional water backs up to damage roofs and walls.

8. Remove snow

After a big snowfall, consider clearing some of the snow from your roof to lessen the amount of weight that your home must support. You can do this yourself using a simple broom or you can hire a snow removal service to clear your driveway and sidewalks as well as your roof.

Many of the measures outlined here are simple to implement but can make a big difference when a winter storm hits. And remember, if the worst happens and your home suffers damage despite your best efforts, contact your home insurance provider to file a claim.