Coinsurance Video
>> Wednesday, December 30, 2009
My latest insurance information video... How coinsurance works on your business property insurance policy.
How to Buy Nonprofit Directors and Officers Insurance
>> Friday, December 25, 2009
My guide to nonprofit directors and officers insurance is available at my store.
Go Here
Includes a description of coverages, endorsements, issues to watch out for and a worksheet to help you compare proposals.
New Insurance Book Shop Open For Business
>> Tuesday, December 22, 2009
My new book shop is open. Books, teleseminars, white-papers, workbooks, ebooks - to help you manage your business better.
www.InsuranceBookShop.com
Employment Practices Liability Insurance Exclusions
>> Monday, December 21, 2009
EPLI policies routinely exclude a number of employment-related actions from coverage including:
-Workers' compensation claims,
-ERISA actions,
-Employment wage disputes (Fair Labor Standards Act),
-Unemployment Insurance,
-Disability benefits law,
-National Labor Relations Act,
-Worker Adjustment and Retraining Notification Act,
-Occupational Safety and Health Act
Insurance Success Tip #9 - Consider Pollution Insurance
>> Saturday, December 19, 2009
Almost all liablity insurance policies exclude pollution claims. Consider buying separate policies.
Oil leaks from a heating oil storage tank? No coverage.
Stored chemicals contaminates a neighbor's well? No coverage.
Pollution is found at a vacant site you own? No coverage.
You buy land and find it is contaminated? No coverage.
Your property insurance provides extremely limited coverage for cleanup of pollution at your location when the cause of the loss is a peril covered by your building insurance. The coverage is probably less than $15,000.
Client Comment
>> Tuesday, December 08, 2009
"Your work for us is as important as any insurance policy we buy."
Bill Swales
Bangor Savings Bank
Risk Management Advice
Each fall I teach a class on small biz management at a local community college. We just finished a unit on risk management. Here are some of the suggestions I made...
--Backup your computer data up every night - off site.
--Hire employees slow. Fire them fast. - Good people a gold. Deadwood will kill
your company.
--Run background checks on every new hire, check references, credentials, and
talk with former employers.
--Build a company culture that values honesty and integrity.
--Build systems that prevent employee theft.
Competition
>> Wednesday, December 02, 2009
To me competition is the best way to get the best price and best insurance coverage. Getting multiple agents and multiple insurers beating each other like a cheap drum always results in good things for the insurance buyer.
Having only one agent who works with multiple insurance companies may be better than just renewing your current insurance. However, true competition only exists when everyone involved in the bid process thinks they may lose.
The threat of loss is a huge motivator for insurers and insurance agents, as it should be.
The Limit to the Question of Limits
>> Tuesday, December 01, 2009
Reader Question:
Hi Scott –
I have read your articles at Guidestar and on your site about D&O for nonprofits. What I can’t seem to find is what criteria to use to determine the limit. I’m part of a nonprofit COO group on LinkedIn and asked others in the group. The few answers I received indicated that limits were suggested by the Board in relation to how risk averse certain individual board members were.
I’d like something a bit more analytical and my board is looking to me to help them analyze and assess their risk. Going from a $2M to a $5M limit increases our premium pretty significantly, so I’d like to make sure that it is called for. Any guidance you can give?
My Reply:
This is the most common question I get.
There are no quantitative answers - past a minimum level. Anyone who gives you a formula is making stuff up.
I have reviewed your financials. To me, $5m is a minimum for you. Your assets and the overall operations tell me you are well past the $2m point.
Beyond $5m I recommend a value based approach. How much is the next million and is it worth it to you and the board? If the 6th m cost $500 you buy it. If it's $5,000 you probably don't buy it.
Sorry I have no magic formula. It just does not exist - beyond superfluousness.
More important than the 5 to 6 million decision is the quality of your coverage. Is the coverage what it should be? What exclusions exist? Can you get a better policy at a better price with another insurer?
Glad to help more if I can.
Read more...
There are no quantitative answers - past a minimum level. Anyone who gives you a formula is making stuff up.
I have reviewed your financials. To me, $5m is a minimum for you. Your assets and the overall operations tell me you are well past the $2m point.
Beyond $5m I recommend a value based approach. How much is the next million and is it worth it to you and the board? If the 6th m cost $500 you buy it. If it's $5,000 you probably don't buy it.
Sorry I have no magic formula. It just does not exist - beyond superfluousness.
More important than the 5 to 6 million decision is the quality of your coverage. Is the coverage what it should be? What exclusions exist? Can you get a better policy at a better price with another insurer?
Glad to help more if I can.
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About This Blog
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Scott lives in Maine and runs a successful consulting firm. He has worked with over 1,500 businesses in his 30 year career.
