Shooting for Optimal Commercial Insurance!

Gun Clubs or Shooting Ranges have many similarities, but are really two very different types of facilities. A gun club is usually operated by the membership which pays dues or fees to belong, while a shooting range is operated by the business owner or a group of investors/owners who operate the business. Shooting ranges are usually run for a profit and have business customers, while gun clubs may or may not be for-profit. Gun clubs have members and guests, not clients.

General Liability Class Codes - Find the best info about insurance for Gun Clubs and Shooting Ranges at https://www.generalliabilityclasscodes.com/

Assuming that you operate a shooting range for commercial purposes or you are getting ready to start such a business, you are going to need excellent gun club and shooting range insurance that will protect you and your customers from many perils.

First, shooing ranges have the same insurance needs as most businesses including commercial general liability, and workers compensation if you have employees.  Usually these two types of insurance are fundamental for business owners as they are required by law in most states.

Second, you need property insurance to cover damages and repairs to all types of property which the business uses to operate.  You should start by making a list of all commercial property that your business owns, similar to an inventory and include all types of property: e.g.

  1. Real estate,
  2. Buildings and their fixtures,
  3. Office furniture and decorative pieces.
  4. Automobiles, trucks, golf carts, tractors and lawn tractors and any other type of moving vehicles you use to care for the premises or in the business operations
  5. Guns and ammo, gun cleaning equipment, and gunsmiths equipment
  6. All other business equipment for instance: gloves, ear protection, protective glasses, archery
  7. Equipment, or any other related items whether you furnish it rent it or sell it.
  8. Signage not attached to the building needs to be specifically included by a supplement or endorsement.
  9. Books of Account, computer hardware and software,

Depending upon how much and what types of equipment your business owns and operates, you may need an additional inland marine policy.  Along with property coverage you should consider coverage for loss of the data, should a power or equipment failure damage the data or information stored, and additional protection from a security breach or cyber-attack to cover resulting costs for loss of income during an outage, expenses to make notification to those who privacy has been breached and damages to clients privacy.

Other items owned  by the business will depend on what items you offer for sale such as food, drinks, alcoholic beverages, gun supplies, etc.  If you sell food you might need lots of other equipment’s such as cooler, coffee pots, stoves, refrigerator etc.  You may need a rider or supplement for refrigeration as this is a common exclusion on many property policies.

The key factor when purchasing insurance is to make sure the gun clubs shooting ranges obtain coverage for all property.

Shooting ranges should carry  a combination of stand-alone and supplemental policies or a comprehensive business owner’s package with endorsements.

Next you need to consider what liability your business could incur from the operations of a shooting range. First of all you need liability for the use of any type of firearm or other types of sport like archery or clay/skeet.  If your business offers instruction or classes in shooting you will need liability coverage and errors and omissions.   You will need first and third party liability for these matters. You may also participate in competitive shooting and other events which will require event coverage or firearm related events coverage.  If you decide to sell beer or alcohol you will need liquor liability specifically which will usually be an additional endorsement.

You may determine that you want to provide on premises gun repair and, or gunsmith services. In that case you will need products liability and errors and omission or alternately gunsmith insurance which specifically includes these types.  You will need Marine Inland or Bailee’s insurance if you store clients’ guns or keep them while you repair the item.  You will also want to include Crime Coverage to cover theft of your property or you clients by employees if your property insurance does not specifically cover it.

Shooting ranges may have special insurance needs when nearby residential property or businesses expand until they are closely located to your business.  Neighbors and persons who are affected by your activities can sue for nuisance such as noise, pollution, and violation of regulatory and environmental laws and in particular pollution.

Lead pollution is a very serious environmental pollution concern for shooting ranges.

People in close proximity to the lead, which is contained in the bullets and the dust from the bullets when it hits the target, can suffer severe injury especially children.  Lead pollution can cause contamination of adjoining properties and waters downstream from you. Lead exposure can lead to injuries to citizens and clients arising from the exposure to the dust and the bullets, as well as employees being injured by exposure.  An environmental insurance policy or endorsement is an absolute necessity to battle litigation, fees and fines from regulatory and government agencies.  In order to minimize some of your costs you will want to have a safety plan which includes having your ventilation systems monitored, cleaned, maintained and insured as well as your environmental policy.  Your employees should take every safety precaution available while cleaning the facility to shield themselves from exposure to the lead dust. Employees are required to have their lead levels monitored by OSHA periodically, which can lead to warnings, fines, medical expenses, remedial action and closure of the business temporarily.

So if you want a bang up insurance policy  covering all your needs do some homework, meet with your agent, ask lots of questions and make sure the policy you purchase is right for you.

Automobile Repair Shops:

Ways to keep your Automobile Shop running like “Greased lightning”

Automobile repair shops are one of the most needed and highly utilized businesses in the car loving culture of America.  Despite the vast popularity of cars, the repair industry has a somewhat tarnished image.  So why do people who love cars or those who just really need a car for transportation have a negative viewpoint about automobile repair shops?

People often feel that they were mistreated and/or deceived,treated rudely, charged unfair prices; or faulty workmanship was performed. They then tend to label the whole industry as bad.  Likewise, repair shops experience all varieties of customers and are subjected to rudeness theft, fraud, disloyal clients who purchase a cheaper product from a competitor while asking you for your advice, and other unpleasant situations.    Unfortunately, this is reality in the car repair business.

Automobile Repair Shop

There are numerous types of automobile repair shops in the industry ranging from one owner with just a few employees to chains stores that feature oil changes and minor repairs to full service garages and huge dealerships. There is no one right formula for success for all.  This article focuses on general auto repair shops which provide a wide range of repairs to the public. Of course customers are vital to the industry, and you are codependent on customers just as they are on you.  What steps can you take to establish or improve the public perception regarding this symbiotic relationship?

People just really want to be treated fairly.  And they want to have their “baby” looking and running like greased lightning.  For non-musical car lovers “Greased Lightning” was the white 1948 Ford Deluxe convertible hot rod emblazoned with shooting silver and gold flames on the fenders which conveyed the image of being fast as lightning in the musical “Grease.” This car became an icon in the movie industry and to the public. It was known as a “chic magnet” by the members of the T-Birds gang led by Danny Zuko (John Travolta) in his famous portrayal of their leader.   “Greased Lightning “was restored in the movie and roared to life after the proper care and attention of the T-Birds and their shop teacher. The rival gang leader drove Hell’s Chariot, a 1949 Mercury, which featured black paint and red shooting flames.  This car was lost for a time after the movie, and later it was also lovingly restored in real life, by its original builder, after setting dormant for many years on the Paramount Lot.

You can take an example from “Grease”  and use the process of restoration to establish or rebuild a favorable image for your automobile repair shop by combining   good old fashioned excellent customer service combined with CYR (Cover your risks). A few suggestions for this are:

Antique automobile repair shop

Set the bar for a pleasant customer experience

  • When a potential client enters, greet and assist them or indicate you will be with them very shortly.
  • Direct them to the waiting area. If you provide coffee or water say so or post the price.
  • Have a play area for kids if possible, with quiet inexpensive activates such as coloring.

Combine aesthetics with customer safety

  • Keep the waiting area in a safe area of the building where no one is exposed to an injury.
  • Keep the public waiting area and restroom clean and visually appealing. Routinely inspect the area for hazards/risks such as puddles on floor and use fall prevention measures.
  • Keep the outside parking lot safe, fix holes in parking lot and sidewalks, provide outdoor  lighting, routinely police the area for broken glass, contraband and contaminants, such as needles, which carry blood borne pathogens.

Learn to appreciate the customer’s input and put it to good use.

  • Ask the client what they feel is the problem, listen and acknowledge their opinion and solicit more information with questions.
  • Explain what else the problem might be and what your procedures are:
  • If you need to run diagnostics tell them upfront whether it’s free or there is a charge and why it needs to be done.
  • Be aware of client’s financial situation: If a client suddenly declines upon learning about the fee, offer them options. (Monetary embarrassment to the customer is a driving factor in their decision making) If they do not have the ability to pay immediately work with them to set a price and a time line for fixing issues one at a time if at all possible. If they cannot proceed immediately due to finances, thank them for their business let them know you will be willing to assist them when they are ready.
  • (Mechanics liens usually prevent the client from being able to simply not pay for your services).  An explanatory brochure on mechanics lien should be available that you can have the customer read.  If they want to proceed having the client sign a contract which says a mechanics lien can be used if they default is s a good risk management practice and puts the client on notice.
  • If you start work on a vehicle and have to revise your estimate let the client know ASAP and get their consent.
  • After service, advise the client of upcoming needed repairs and maintenance. A print out would be great.
  • Be patient with complaints, acknowledge and fix the problem if at all possible.
  • And try to keep calm and carry on!

My Insurance Question - Get the best answers to your Automobile Repair Shop Questions.

 Show off your talent:

  • Display large pictures of cars you have lovingly restored or fixed with their happy owner’s as well as showcasing automotive industry awards and Certificates of Membership from  industry associations which address customer excellence.
  • Display testimonials or thank you letters from clients
  • Use miniature cameras to record your employees work to prevent mistakes and complaints. Then furnish a complimentary picture for the client showing them with their car smiling.

There are many other things you can do to feature your company in a positive light and focus attention on the quality of your work.

At the same time you want to take every step possible to protect your business from any bad apples while also protecting your valued clients and employees with comprehensive insurance coverage.

  • General Auto repair shops are in the business liability category of Automotive Services and Sales.
  • The SIC Business Code would most likely be the General Automotive Repair Shops-7538.
  • The NAICS Liability Classification would be 811111-General Automotive Repair.
  • The ISO General Liability is 10073 Auto Sales, Repair and Service and the Worker’s Compensation Class code is 8380 Auto Repair.

Various types of insurance will be necessary. All automobile repair businesses will  need worker’s compensation which is mandatory if they have employees and do not have the ability to self-insure.

Employers Insurance Company has created this great video about the Workers’ Compensation Insurance needs of Automobile Repair Shops.

You will need General Liability (slips and fall) and business property.  You may want a BOP with the following:  Business income and extra expense, Hired and non-owned auto, Commercial Crime,  and Umbrella.  Be aware that some business property policies do not cover signs which are not attached to the building, so you would need a rider.

Automobile repair shops also need to determine whether they need Garage Liability, or a Garage keeper’s policy. These two types are not identical. They address different needs.  Generally speaking Garage Liability is more useful for a dealership that does auto repairs than a stand-alone auto repair shop.  Many times a dealer will need both garage liability and garage keepers if they do auto repairs.

Garage keeper’s is best for a non dealer auto repair shop which may combine legal liability, direct primary and direct excess for customer’s automobiles.  Commercial General Liability has an exclusion for client’s cars which are in the care, custody and control of an auto repair  shop  including test drives. Garage keepers covers what would be missed under the exclusionary language of the GLC policy and function much like Bailee’s insurance.

If your repairs fleets  of autos for government, large corporations or schools; most of them will require Garage keeper’s with direct primary coverage and a Certificate of Insurance.  Some may require that they be listed as an additional insured.

Cyber insurance is also highly recommended in light of the Payment Card Industry Standards and threat of data breach. You could be liable for the invasion of privacy, notification costs and damages should a customer’s data or identity be stolen.

Other types of insurance worth considering: Employment Related Practices, Moneys and securities, Accounts Receivable, Computers, Goods in transit, Valuable Papers and Records, Employee Benefit, Environmental Impairment and or sewer back up.

With all of the clients concerns and safety addressed and insured you can focus on your main priority. Making cars run like greased lightning!

Concrete Contractors and Silica:

The field of Concrete Construction is extremely complex. This type of construction is subject to the ASTM International Concrete and Construction Standards (The American Section of the International Association for Testing Materials) as well as the American Concrete Institute Standards for Design and Construction.

Each build differs with the type of cement, sand and aggregates used to mix the concrete.  The contractor must consider the moisture content, the strength of the mixture, the chemical reaction abrasion test result, and numerous other factors which go into planning a build. One of those factors is the use of silica in the process of making concrete and removal of silica. This mineral is about to make the job even more complex and  may affect the bottom line due to increased need and costs for insurance coverage which shields you from liability for it’s use.

All concrete contractors need commercial insurance including commercial general liability and worker’s compensation which are required by law in most states. It is important to remember that general liability does not cover all insurance needs. You will also need Commercial Property, Commercial Auto, Inland Marine for tools and equipment and/ or Goods in Transit and Installation.

Additional recommendations not specific to  the installation of concrete, would be Employee Dishonesty, Employee Benefits Liability, Employee Related Practices, Loss of Business Income with Extra Expense, Stop Gap Liability, Umbrella Insurance and Professional Liability for design and installation. You also need Heavy Equipment Insurance if your commercial auto does not cover large vehicles such as a cement mixer truck, dump trucks and other heavy equipment you use.

Specific Industry related recommended insurances would include Contractors E&O, (This is not the same as Professional Liability insurance) E&O covers you when you make a mistake and are negligent during the building process.  Along with E&O you need a custom combination of the three types of insurance below to protect your business from environmental threats.

  • Products Liability
  • Environmental Impairment Liability
  • Pollution Control

The need for these insurance types has come about with the rise in litigation surrounding the construction industry as a whole and regulations  imposed for each specific industry in the field of construction So you may need all of these separately or combined in a BOP depending on what your carrier offers.

Due to health concerns for workers and the public, OSHA recently adopted new rules in regard to airborne (respirable) silica. Silica is one of the varying components contained within the sand, rock and the cement used in the concrete mixture by contractors.   This rule will significantly impact Concrete Contractors. Crystalline silica (SIo2) is the type used to make concrete as opposed to amorphous silica.  All of the 5 types of crystalline silica are listed as known occupational carcinogens by the CDC.  Crystalline silica is hazardous when it is used in construction processes such as blasting, cutting, chipping, drilling and grinding which make the silica “respirable”.  It works much like asbestos which is not hazardous unless disturbed, and then the substance becomes friable. When silica is disturbed by construction processes it becomes “respirable” and workers breathe silica in and it becomes hazardous and can  cause Silicosis and many severe lung related diseases which can be fatal in addition to cancer.

The Insurance and Risk Management Institute (IRMI) has predicted that the litigation surrounding silica will rise and result in increased environmental litigation much like the issues surrounding toxic mold did and points out that as Silica is a known carcinogen while mold is not. Aside from IRMI’s prediction silica seems to be more akin to asbestos than mold in some ways. According to the Department of Labor Construction Workers as a whole have an anticipated death rate of 1.82 as opposed to metal mining where the rate is the highest a 69.51%.  But that figure could be categorically higher for concrete workers ( the study was not broken down to examine different types of construction workers) as their exposure to respirable silica is frequent, due to contact with the components used to make concrete and resulting concrete dust, while it is being mixed, installed, poured, leveled, troweled edged, brushed finished and cut to specifications.  Workers are also exposed to the dust during the removal of old concrete from a construction or demolition site or during remodeling.

As pointed out by IRMI, the growing numbers of silica litigation could cause an exclusion to be carved out by insurance carriers for silica just as one was created in regard to asbestos. So look for an exclusion specifically for silica in your general liability policy to become a reality in the near future throughout the construction industry but particularly in regard to concrete contractors and workers.  Additionally insurance carriers could deny coverage based on the total pollution exclusion if a court finds that silica is a pollutant. It is very likely that silica would be considered a toxin.

Despite these issues, it does not mean that liability coverage will not be available if silica is used during the construction project. It means:

  • Concrete contractor will need to carefully review their existing policies and question your agent whether coverage for silica exposure is specifically excluded or there is a pollutant exclusion. If so,
  • Concrete contractors will have to purchase an endorsement, rider or supplement  that covers silica  either as an environmental hazard or a pollutant and adds coverage in addition to  any exclusion in  their existing CGL policy; or purchase a new BOP designed to cover environmental pollution and  pollutant liability
  • Insurance carriers will want safety plans that comply with specific OSHA regulations and the new silica rule to prevent silica exposure through the use of safety equipment and limiting time of exposure to be part of your everyday operations.
  • Expect higher workers compensation premiums as awareness arises and workers are diagnosed with silicosis or other related diseases.
  • Compliance with OSHA regulations to prevent or minimize exposure will be critical and will hopefully reduce the amount of your premiums.
  • Products liability will be necessary because the concrete mix you are making is actually a product you made or “manufactured” and you would have liability for it; if it is harmful to the public.  You also have liability during the demolition and removal process for old concrete that you encounter as it will become respirable at that point: and you will have liability for any other toxins uncovered during the removal. If you purchase the concrete from an outside source, you may  also still have some liability for using and installing it and recommending it to the client just as asbestos manufactures and installers were liable.

CNA Insurance offers a Subcontractors Errors and Omissions Policy with Pollution Liability which is endorsed by the America Society of Concrete Contractors.  Their Pollution Liability Coverage includes asbestos, mold and respirable dust or Silica. Travelers also offer Contractor’s Edge policies.  Many other carriers have policies that you can purchase additional supplements and endorsements for which can provide for coverage of these hazards for silica and/or other toxins which have exclusion in your CGL policy.

Handyman Insurance Exclusions

Handyman Insurance Exclusions and how to address them.

Read the best information about handyman insurance at myinsurancequestion.com

Handyman services fill a market niche that seems a miracle to some of us who just aren’t handy at all; or those who have reasons why they can’t do certain household projects on their own. If one finds a handyman (or handyman service) that is reliable, reasonable, thorough and knowledgeable; it is a treasured find and people want to keep using their services in the future.   Smart and savvy Handymen or businesses can capitalize on this public sentiment.  One way to build trust with your client base is to be prepared in case something does go wrong by having insurance that covers you, the insured, and the customer who is considered the third party.  Accidents happen inevitably, even when you take all safety precautions possible so you need to be covered for all possibilities that you might incur liability for.

Business Liability Category: Artisan Contractor

SIC Business Insurance Codes:

  •   1521- General Contractor- Single Family Homes
    •   1522- Residential Builders- Other Than Single Family
    •   1799- Special Trade Contractor

NAICS Liability Classifications:

  •   236118- Residential Remodelers
    •   238350- Finish Carpentry Contractor
    •   238990- All Other Specialty Trade Contractors

Business ISO General Liability:

  •   Code: 95625- Handyperson

Common Workers Compensation Class Codes:

  •   5645- Carpentry and Construction- Residential

A handyman business may fall into any of these classifications.

Just as in any other type of construction business, General Commercial liability is your starting point or foundation and is normally required by state law.

Each Commercial General Liability Policy has its own exclusions based on the type of work you specifically perform.

Three exclusions are commonly a part of a Commercial General Liability Policy for construction based industries and handyman businesses These exclusions are of concern and can cause you to lose clients and gain a bad reputation in the community because clients can be left with a financial burden if your insurance does not cover their third party claim based on one of these exclusions listed below:

  • Completed Operation
  • Excluded operations
  • Residential operations

 

Most General Liability policies are considered claims made or completed operations policy.  Completed operations basically means that once a job is done if no claim is filed  while the work is being performed, then  there is no coverage after the jobs completion.  Alternately, in  a claims made insurance policy a claim can be made at any time while a policy is in force and the policy coverage can be retroactive at renewal each year. Completed operations are less expensive than a claims made policy but in the event of an injury to your client, their family or a guest in the home after the job is over, it will be money well spent rather than paying third party claims out of pocket and having an irate client who can affect your bottom line and tarnish your reputation for backing your work. Even when the insurance carrier does not provide coverage due to an exclusion you are still liable for a third party negligence claim judgment if one is entered against you.

Excluded operations is where a specific  type of activity is excluded such as roofing or plumbing and you have contracted for a handy man job repairing one of the excluded activities, thus leaving you with no coverage at all under this policy for this activity.  Again if liability arises, you or the business will usually be liable not the insurance carrier.  If you have such and exclusion you either need to purchase a supplement or have a new BOP policy written which includes this type of activity.

Residential operations  exclusion.  Most handyman jobs historically were for homeowners but that has changed as trades become more specialized and licensing more regulated. So this exclusion specifically means there is no coverage for any work performed on residential property.   So it is baffling why any handyman policy would include such an exclusion, but they do. This exclusion can sneak up on you as the exclusion is sometimes listed in the section under excluded operations which can contain a number of exclusions rather than as a separate exclusion. In actuality it will still preclude  coverage all work or repairs performed on on a residence. If you don not work on residence it will not be relevant.

A diligent handyman owner should thoroughly inspect the GLC policy to determine if there are any references to any exclusion of any sort and make sure you understand the exclusion and what that means to your business.   Sometimes the exclusions   listed in the policy are referenced only by the ISO form number. The ISO form for each exclusion should be specifically attached to your policy.  If not, make sure you obtain a written copy of each  separate exclusion form listed as a  number and examine it until you understand what is excluded before you proceed.

For each exclusion you do not want in place you will need to obtain an endorsement, rider or supplement to cover that liability. Or you can have your whole BOP rewritten, which is advisable if you are entering into a new aspect of construction;  and make sure you inspect the policy after revisions are made and determine that they include everything you want covered versus excluded.

Remember an insurance policy is a contract and you are presumed to have read it before signing.  The Insurance Carrier specifically advises you of this when you enter into a an Insurance contract.

While you are reflecting on the nuances of your policy take the time to consider new products which might be beneficial such as, electronic data/ cyber security/data intelligence plan, or pollutant /environmental endorsement, and/ or drone coverage if you are using the technology in your business.

Taking preventative steps can save you a lot of money in the long run and will help cement your relationships with your clients.

Home Health Care Liability Needs.

Meeting our seniors & disabled population’s health care needs through   thoughtfully designed, safety conscious insurance coverage for the business owner, while protecting both the patient, and their caregivers/employees in the Home Health Care setting.

Home Health Care

With the baby boomers rapidly aging, their growing health issues have sparked an enormous need to expand businesses caring for the elderly.   Additionally, disabled people have the same needs but may not be elderly. Two types of businesses that care for the elderly and disabled are home health care agencies and assisted living facilities.

These two industries are considered the least restrictive options for health care, allowing seniors and disabled persons more flexibility and control over their own living arrangements. Patients and their families may see home health care as the most attractive option so they can both retain their autonomy and remain in their home near their family.

Providers in these fields bear a great responsibility to care for people in an ethical and caring manner. Intense scrutiny is placed on each industry to provide quality care. Both the home health care and assisted living industries are highly regulated in every endeavor they undertake: by law enforcement, governmental licensing agencies, government insurance carriers, private health insurance carriers, workers compensation insurers, the medical profession and even the insurance carries which service these industries needs directly. Safety for all, especially patients and employees, is an extremely important concept in insuring both of these industries and directly impacts a provider’s rate for your insurance premiums.

So as a business owner analyzes what insurance coverage you want for your agency, safety needs to be a factor in your decision making in order to protect all concerned.

In order to address this vast topic this article will be divided into three sections:

  1. Home Health Care Agency Insurance
  2. Assisted Living Facility Insurance
  3. Workers’ Compensation and employee safety protocols for both types of industries.

Section 1.  Home Health Care Agency Insurance

Home Health care providers, whether for profit or non-profit, fall into the SIC Business Insurance code 8082 Home Health Care Services.  These entities should have all of the generic insurance types below:

  • general commercial liability
  • worker’s compensation,
  • business auto (hired and non-owned),
  • business personal property insurance, mobile medical equipment, durable medical goods
  • commercial real property insurance, or commercial renters insurance
  • commercial crime and employee dishonesty, bonds, damage to client’s property
  • Inland marine or property in transit.
  • Equipment breakdown, Loss of income
  • Professional liability
  • Data Breach and Cyber Security

Some of these coverage’s are standard policies and are available through most commercial insurance carriers as part of a business owner’s package with supplements and or endorsements. The State Department of Health where you are operating may have a minimum amount of liability you must carry if you do business in that state. Additionally, if you accept Medicare or Medicaid your general and professional liability must meet their certification requirements.

However, due to the gestalt concept of providing care in the privacy of the clients home, there is less direct supervision and real time scrutiny of the staff as the actual care takes place  by the agency. The agency has a duty to to ensure  adequate care accompanied by an obligation to protect the client from abuse or neglect by the employee providing the care; yet  alternately imposing a greater responsibility for the employee to be a guardian for the client and report unsafe conditions or abuse by another in the home, and take appropriate actions, even if unwanted by the client.

In order to protect the agency, the business owner must be acutely aware of this double edged sword and carefully choose coverage which ideally incorporates the best safety practices used in this industry.  Some types of insurance listed above deserve more in depth discussion due to the nature of the services provided to the client.  Some of the options discussed are not available through every carrier and your agent may need to find carriers who specialize in providing coverage for this field.

For instance, Professional Liability is absolutely necessary and critical in this field because you are delivering health care. Strategically, there are some different options.  You may prefer a carrier who provides coverage for every member of your organization including employees, volunteers, medical directors, students, independent contractors and the Board of Directors.  This option may be cost prohibitive and the agency might consider having professional liability for its medical staff and requiring each doctor or nurse to carry their own excess professional liability policy in addition to the agencies; with the agency being an additional insured on the staff’s individual policies.  This is akin to a hospital requiring physicians to carry medical malpractice or professional liability in order to be on staff.  It may also be referred to as Primary and Contingent Medical Professional liability.  You might also want to look at obtaining a large umbrella or excess professional liability policy for directors, administrators and officer’s liability as they may not be in the medical profession.

The doctrine of respondent superior  is the legal theory that holds the employer liable for the negligent acts of employees while acting in the scope of employment. As part of your agency’s duty to care for the client, you are responsible for the patient’s life in some cases where they are extremely ill or near the end of life.  If the employee fails to show up or walks out and the patient is left unattended you are liable.  If the employee arrives intoxicated whether from alcohol or drugs or other substances and makes a mistake you are liable.  If an employee is careless and lets a patient burn themselves while smoking you are liable.  I am sure you can see the pattern here and realize this field has an extremely high exposure for liability.

However, all the insurance types shown above still may not be adequate to protect the agency from liability for its employee’s intentional acts.  Under general commercial liability, neglect of a patient by an employee while acting under the scope of employment as shown in the examples above should be covered by your general liability policy but usually intentional harm to the client is not.

One might think commercial crime might provide this protection. Commercial crime insurance does cover dishonesty in terms of both money and inventories belonging to the company and a rider or supplement can be purchased to protect the client’s property.  You also need to ensure that the situations covered include employee’s acts, error or omissions in administration of the employee benefit plan, or fraud on the part of a medical director or administrator, and legal expenses to defend a case again a director or administrator.

Unfortunately, neither general commercial crime insurance does not cover assault, battery, elder abuse, sexual abuse or exploitation, of the client, or any other intentional tort by an employee. These are often exclusions under the policy.  The health care industry has a heightened duty to protect its clients as they are considered vulnerable people.  Statistics are alarming regarding the frequency of occurrence of intentional abuse.

Therefore, you also need to exercise due caution during the hiring process by always identifying whether the employee has previous violent or criminal history or mental health concerns which might place a client in danger. In that instance you can be directly negligent for injuries inflicted on the basis of negligent hiring or negligent retention if you retain an employee after becoming aware of previous bad acts.  Additionally, even if you have an assault and battery insurance supplement your knowledge of this employee’s past behavior or if you should have known this information, may allow your carrier to decline coverage depending on the wording of your policy.

Insurance coverage for assault and battery (a/k/a abuse and molestation) by agency employees is  not widely available but it is very necessary. This  insurance type must be purchased as  a supplement or endorsement in addition to general liability but given the high  risk exposure for this type of claim it is one you should obtain if at all possible.  More insurance carriers are offering this coverage as awareness of the problem grows. If your carrier does not offer this option, solutions such as part of a business package, supplements and stand-alone polices are available through carriers such as but not limited to:  Solutions Group, Hanover Home Care, Cincinnati, Philadelphia and Markel who specialize in insuring this industry.

Conversely, you may have a patient who harms an employee.  The patient may be abusive or impaired by their condition.  Patients may have Alzheimer’s disease, senility, other mental health disorder or be delusional and think they are being attacked in some way.  You’re first instinct may be to abruptly terminate services for this patient. This is a very risky method of dealing with the problem.

This reaction may leave you liable for  “patientabandonment” which is another tort that you can be liable for. You must take steps to ensure the patient health care is undertaken by another provider or give a sufficient notice with reasonable time for the patient to obtain care by another health provider.  This is usually covered under professional liability insurance but scrutinizes your policy to ensure that it is not excluded, and purchase a supplement if needed.

Today more clients also want options that suit their individual tastes and desires not just what is available through the usual channels. Innovative housing options are available as an adjunct to home health care.  One such option is the “med cottage” which is basically a kit which allows the patient to turn their garage or other building located on the property where they are residing into a state of the art hospital room for the family member who needs care. Another option is taking an ordinary out building and outfitting it specifically for the patient through a licensed contractor specializing in medical construction.

Should your agency work in one of these buildings,  or an ordinary house, medical equipment will most likely be used by your staff.  You want to make absolutely sure that you have insurance which covers both specialized medical equipment and durable medical goods and equipment. It is likely that you or the client will have to rent or lease some of the medical equipment.  Sometimes Inland Marine Insurance covers this need but you need to be sure it is spelled out whether damage by your employees to rental equipment is covered. Additionally, you need Medicare certification and surety bonds if you provide or supply the durable medical goods to the client, as part of your services.

Harm to a client could also result from a defective machine but would normally be covered by products liability coverage on the part of the manufacturer.   However, improper cleaning and sanitation on the part of your worker resulting in harm to the client could be negligence on the agencies part.

One last type of insurance is critical to the Home Health Care Agency and that is data breach & cyber security.  This is particularly true because you are dealing with medical records subject to HIPPA. You want to make sure you are covered for the actual expense related to the breach as well as any fine or penalties levied by any government entity for a HIPPA violation associated with the breach.

Comprehensive insurance is your best suit of armor in the home health agency field. Protect yourself, your staff and your patients  accordingly.

 

suit-of-armour-for-finding-the-best-home-health-care

 

 

Microblading in 2017:

Microblading, isn’t it like Tattoo’s or Permanent Makeup?  Is it too risky for your beauty salon?

Microblading is all the rage at present and anticipated to continue growing exponentially in 2017. Numerous types of businesses are performing this beatification process and thousands of women are scurrying to places where they can have the technique performed.  If you are thinking of adding microblading to the current menu available at your beauty salon or spa, you need to be aware of the benefits and the risks to ensure your business is protected.

Microblading: If you're thinking about adding microblading to your salon or tattoo parlor, get the answers to your liability risks at https://www.generalliabilityclasscodes.com/

Microblading is the process of making minute incisions in the skin surrounding a person’s eyebrows and injecting tattoo ink or pigment, which is preferred by some artists, to make the client’s eyebrows appear full and lush. In Microblading you are not cutting hair or applying an external chemical process to hair which can grow back rapidly; you are cutting into the skin and tissue in close proximity to the eye and the brain with a needle very similar to a scalpel. You are injecting tattoo ink or pigment into the cuts in the skin and tissue which can result in a variety of infections and complications.  These include fistulas, inflammation, inflammatory diseases of the eye, eyebrow, facial tissue, glands and muscles with spreading to the brain, scarring, and hyper-pigmentation. http:/www.ivylasersalon.com/microblading-dangers-and-disasters/Additionally, there is danger of transmittal of blood borne pathogens and communicable diseases.  All of these can be caused by:

  • Contamination of the instruments used in the procedure,
  • the actual ink or pigment injected into the skin,
  • And/or the local water used to dilute the inks used in the process.

Microblading is not the only common name for this procedure.  It is also referred to as eyebrow embroidery, micro stroking or feather touch and technically includes the process of micro-pigmentation. According to the Skin Science Institute, it is usually administered by an esthetician, tattoo or make up artist.

Regulation of artists performing Microblading is sporadic and confusing. There are no well-defined processes developed for compliance with all the applicable laws and rules. While Cosmetologists have a very structured training and regulation process for licensing, microblading is not regulated in the same manner.  Each state sets standards for training in tattooing and permanent makeup and determines whether they need to be licensed or certified; how many hours of training are required and whether an apprenticeship is needed.

Microblading artists are usually a permanent make-up or tattoo artist as the FDA regulates tattoos, including eyebrow tattooing, and considers it to be permanent cosmetic makeup. Tattoos & Permanent makeup: Fact Sheet, http://www.fda.gov  Whether you choose to use pigment, which some artists prefer, or tattoo ink; the product used for Microblading, has to be approved under the Federal Food, Drug and Cosmetics Act. Laws regulating the actual tattooing process vary significantly depending on the state you are working in. Usually the State Department of Professional Regulations regulates both Cosmetologists and Tattooing separately but some states do not even mention Makeup Artists, Permanent Make-up Artists or Estheticians.

Liability coverage for Microblading can be added to most insurance packages.

The Microblading process exposes you to liability well beyond the normal routine matter for a beauty shop or spa and is actually more akin to a medical procedure.

It is fraught with risks for the clientele, leaving you quite vulnerable to liability. On the other hand, it is a very popular procedure, especially with older women, who comprise a large portion of the clients who use salons for this procedure. Additionally, you want to remain competitive in this field so what can you do to insure and protect your business?

The key factor is to you use all of the available insurance protection options wisely. It is incumbent upon you to inform your agent or carrier that you are going to start offering these services. If you do not inform the insurance company they have no way of knowing until you make a claim.

If you fail to inform your insurer it is easily arguable by the carrier that microblading is not covered under the general liability class codes or workers compensation class codes for a beauty salon under either a standard general liability policy or BOP for a beauty salon.

It is also arguable by an insurance carrier that Microblading is being performed by artists that are not covered under a standard general liability policy or BOP for cosmetology as they are not licensed cosmetologists.  This would hold true even if the policy has no specific exclusion for microblading.

So the answer here is you need coverage for the specific act of Microblading.   You can accomplish this by having a new BOP tailored to meet both a beauty shop  including a permanent makeup artist and a tattoo parlor performing Microblading.  This art can also be covered with an endorsement, supplements or a stand-alone policy specifically addressing the activity to be covered and the employees performing the activity.  You want the policy to clearly define what Microblading is in all of its many forms or names and specify that is covered in all instances.  You may want to fully describe the action of cutting the skin and injecting inks and pigments into the skin.  You want to make sure that your artists are certified or licensed appropriately in the state where the act will be performed.

When adding microblading to your beauty salon, make sure to purchase the right liability coverage by doing your research at General Liability Class Codes.com

Also compare your  beauty shop policy to a tattoo artist or a permanent makeup artist policy and determine what acts are covered by a tattoo artist policy but are missing from your policy and then you want to add those  features by endorsements to your existing policy.

Of course you  will still absolutely need general liability, property insurance, workers’ compensation and any others which are standard for salons.  Additionally, you need professional malpractice a/k/a as errors and omissions for permanent makeup artists and/or tattoo artists in addition to E&O for  the beauty shop.  You also need products liability, for the inks, pigments and blades.

Typically tattoo artist policies include completed operations which might not be a part of your cosmetology policy.  You will want to have this covered because tattooing can fade, leaving scars well after the tattoo is completed.  Tattoo parlor insurance usually includes protection against communicable disease and blood borne pathogens, as well as apprenticeship or guest artist insurance.  You cant have a tattoo business without this coverage.

If you plan on the artist  creating tattoos other than on the eyebrows, sexual abuse coverage may unfortunately  be a wise type of coverage to carry as clients sometimes want tattoos in delicate places which are usually performed in a secluded portion of the salon. Sadly some clients bring a claim for abuse or inappropriate touching which can be a battery, whether or not it is justified. This is not necessarily covered by standard crime coverage.  Don’t hesitate to ask your agent to check whether this is covered on your policy if you have crime insurance.

So as they say, people make a statement about themselves when they obtain a tattoo. Your shop can make a statement too by the manner in which they create wearable art which enhances a client’s facial appearance and have the pleasure and satisfaction of knowing their art is insured to the fullest extent possible.

 

 

 

 

 

 

What is seasonal increase coverage for a florist?

And why do you need it?

 

Get the best info about insurance for Florists.

 

Valentine’s Day has just passed and the pleasure it brings to scores of people lingers fondly on our minds.  Maybe florists do not view the holiday with the same delight, as the hustle and bustle to prepare for the holiday, as Valentine’s Day is one the biggest seasonal peaks for sales during the year. During any seasonal peak the floral inventory is usually significantly larger than at other times of the year.

If you are a florist, hopefully this season went smoothly. But if you experienced a loss of any of your business floral inventory your losses would most likely be higher than normal, based on the value of the larger inventory.  Comfortingly, this is one time of the year when insurance coverage may be expanded without an additional cost to you.

If your standard business property policy includes coverage for a seasonal increase your coverage limit may be  raised 25% at the time of a loss provided your preceding 12 month average value of your inventory and business personal property is 100%  of the policy limit. http://www.assuranceagency.com/blog-post/the-peak-season-endorsement.

This coverage feature is not available when the business is not experiencing a peak season, such as Christmas/Hanukkah/Kwanzaa, Mother’s Day, Valentine’s Day, Easter/Passover, and Thanksgiving.  These holidays are all statistically peak seasons for florists.  Spring weddings may be peak seasons  as well, but the true test depends on your inventory volume and value.

Along with this potential free benefit, you might consider purchasing optional peak season coverage, which provides heightened coverage for possible losses during a peak season.  Various insurance carriers offer this expanded coverage in different formats.

For instance, it can be offered as a feature in Florist Business Insurance Policy (Similar to a BOP).  State Farm offers this feature. Or it can be offered as a part of a Florist Stretch endorsement utilizing ISO appropriate forms. For example, the Hartford offers such an Endorsement. (See From SS 04 09 09 07). Many other non-captive commercial insurance carriers offer similar endorsements.

American Family offers a hybrid feature where the first 25% seasonal increase is a part of the standard business property policy and another 25% additional coverage is offered as an enhanced endorsement.

Of course, you must first have standard business/commercial property insurance or a bop before you can purchase a stretch or enhanced endorsement in combination with your  standard policy.  The standard coverage will have a policy limit on the property loss by each type of covered property and the endorsement catapults the policy to a larger value.  If you have acquired an endorsement you can tailor the endorsement to list the actual times when you anticipate a peak to occur. If you specify the beginning and ending dates of your peak season in your endorsement policy be sure to allow a little extra time at the beginning and end of your peak to accumulate and dispose of inventory. However, exercise caution so that you don’t extend the time unnecessarily as it might backfire and you could end up with a co-insurance penalty.  This type of penalty arises when a loss occurs and the value of the lost property  exceeds the percentage of  value of the property coverage required in the policy. https://www.eqgroup.com/coinsurance/

As your business grows hopefully your sales will increase which, in turn means you will have a larger amount of inventory.  Periodically review the value of your inventory and determine whether your policy limits are still adequate and update the coverage if not.  That action can help prevent having a coinsurance penalty issue.

One other coverage issue is closely related to your floral inventory, whether or not you are in a peak season.  That is known as  spoilage. Flowers and fauna can spoil when refrigeration units break down:

  • While at the shop
  • in transit to a delivery
  • at the sight of an event where you are providing the flowers
  • Or when the power goes out due to an outage.

The critical question then becomes:  Are all of these events covered under business property insurance or a Florist BOP or are they excluded?  To be sure, examine your policy and determine if you need an endorsement for spoilage, refrigeration or utility services interruption, or all of the above.

If you need help with the nuances of your policy don’t’ hesitate to ask questions and discuss with your agent so you can be assured that you are getting a sweet deal.

 

What insurance does your technology business need?

Tech E&O insurance, cyber security/ data breach insurance, Electronic Data Processing Insurance or  Digital Asset Insurance: Which insurance will meet all the needs of your technology business?

This article assumes that a technology company will normally already have basic commercial general liability insurance coverage and business property insurance or a business owner’s package with or without excess or umbrella insurance. These fundamental types of commercial insurance, while critically necessary, do not provide protection for everything due to exclusions contained in the policy and/or terminology and verbiage used in the insurance contract.   More than one type of insurance which is essential for tech companies are still lacking. For instance, Commercial General Liability sometimes covers damages for errors and omissions due to the failure of a product IF you have a tangible property loss, but most times it does not as there is no tangible property loss.  Another example is Umbrella insurance while desirable, often excludes any E&O coverage totally.  You still want to have an umbrella which adds higher limits of coverage to other types of insurance your company carries.  The real answer to which insurance will meet all of your tech companies needs is most likely “none of the above” but insurance policies can be combined to give you the maximum coverage possible.

So the tech company may need just one additional policy, or several more types of or stand-alone insurance policies to address risks which are foreseeable in the tech industry.  The two most well know types are cyber insurance/ data breach and professional liability or E&O Insurance.   Other types you may need would include are Electronic Data Processing and/or Digital Asset Insurance.  New products are emerging to meet the needs of technology and others may be added in the near future.  Technology insurance is not yet standardized. Adding one or more of the types of coverage which are available now  will add layers of protection to your existing insurance and can provide full protection for every conceivable risk when they are fitted together like pieces of a puzzle to solve the insurance quandary faced by your company specifically.

Small to midsize technology company’s face rapidly evolving roles and ever changing work climates on a routine basis.  In fact, it is very difficult to find a consensus on a singular definition for a “tech company”.

Insurance coverage for the technology industry is best selected by the role or the function of the company.  There are tremendous variances in “tech”   companies and how they operate and what they do.   If you are a technology company you could be a computer information technology company, a data storage company, a data management technology company or a computer technology company which manufactures computers or designs computer systems, or writes computer codes for certain industries; or builds operating systems for all types of products including tech gadget or apps. The company could even provide all of these services.  Any and all of the companies described above, along with hundreds of others, can be classified as a technology company.  But the functions performed by the company are the key to knowing what actions you need to have insured.

The demands for diverse  types of technology  fosters  the vast species of tech companies and leads to varying  claims  against  tech companies which usually arise due to either  the failure of the product provided by, or the services performed by the “technology “company, or both. So the owner must determine what specific coverage is tailored to protect the company’s products or performance from liability by thoroughly examining what insurance is available for this industry and what exactly does the insurance policy cover.

In most businesses or professions, Professional Liability or E&O (Errors and Omissions) is a critical need. Technology is no exception.  In the technology vernacular this is most frequently referred to as a Tech E&O policy. Let’s say that your tech company “Best Tech Company Ever” designed a computer system  for a client and selected ,but did not manufacture the components, and now manages and stores the data produced from the computer system and analyzes the raw data and provides analytic data to the client.   Undoubtedly, Best Ever Tech Company  needs to be fully covered for errors and omissions on the part of employees and owners. Tech E & O provides wide coverage for a host of services including data hosting, data processing, computer systems analysis, network management services and software  programming.  “5 Insurance Issues to consider in Tech Transactions,” http://blogs.orrick.com/insurance/authorD.Teshima

The BETC Company needs errors and omissions insurance with coverage for computer systems design, computer analytics, data management and data storage coverage.  Tech E& O would cover all of these provisions as negligent acts. However, E&O does not include intentional acts or torts so you still need another layer of protection.

BETC doesn’t need E&O coverage for manufacturing the system or the components, (products liability) but does need coverage for design of the computer system if it does not work as anticipated, either due to the parts or software not being compatible or other inherent flaws. The company could possibly need coverage for loss to the client’s income if the computer design of the new system caused the product not to work in the intended fashion. BETC also needs to be insured for its advice and recommendations on what components to purchase to make the system run efficiently, coverage for the result of their data analysis, if incorrect, or the system is unable to perform comprehensive analysis, and coverage for the data being stored for the client regardless of the methodology used for storage if there is a negligent error which causes a loss of data.

Tech errors and omissions should be sufficient for most employees but the owner needs to investigate whether the policy needs additional cover age for Officers and Directors Errors and Omissions who may not be involved in the technology side of the business.  This could be added by an endorsement or a rider to the BOP or Tech errors and Omissions.

Cyber Security is also advised for BETC.  Cyber security differs from E&O.   Cyber security covers network security failure and breach of data which are not the result of an employee’s negligent error such as an accidental error, but rather a direct act or attack usually by a hacker which can be accompanied by a demand for ransom.  Cyber security also covers an employee’s actions if intentional or fraudulent, rather than an error. Cyber security is very complex and there are various ways to structure a policy. ISO  has not yet issued a standard form for use.  There are numerous questions to consider and the owner should conduct a thorough risk analysis with his agent before deciding upon cyber security insurance policy.   Some of these are:

  • Does it cover both 3rd party liabilities for your client’s breach of their privacy and first party coverage for you the insured?
  • Does the triggering event language limit to an intentional breach or is  it triggered by any failure to protect data by the insured which is preferable
  • Is there coverage if the insured fails to disclose the breach
  • What event triggers the duty to defend? A liberal approach would be if a request for information is the trigger while the most restrictive is the actual filing of a law suit as trigger. You would want to have the earliest trigger possible
  • Are civil fines and penalties covered
  • Are notification costs covered? There is a wide variance in what cost are covered which varies according to each individual state. Does the coverage limit you to using vendors for notification which are picked by the insurance carrier?
  • Most importantly in some case does it cover data loss and the cost to regain the data?
  • Another major factor for consideration is does the policy exclude acts of terrorism or war. If excluded then be very wary and make sure that the policy clearly states that extortion, using ransom-ware or doxware and/or security breaches are not excluded under this clause.

As each technology company is unique the above list is representative only and not exhaustive. For a more in depth discussion see: “Analyzing Cyber Risk Coverage, http://http;//riskandinsurance.com/author/steve-raptis

In the past, coverage for computer equipment was based on business property insurance, however it often excluded   losses caused by computer viruses or hacking which newer Cyber insurance policies now cover.  Separate and apart from cyber security issues, Electronic Data Processing Insurance developed simultaneously and was designed to specifically address computer operations.  EDP insurance covers computer equipment, Media Data and Data Recovery. It is meant to cover break down of the equipment and resulting losses from inability to process the data. Another method is to add an enhanced super stretch such as those offered by the Hartford to a BOP, which can cover computer hardware and software as well as damages to the equipment from changes in temperature.  A change in temperature can be a major issue when large heat producing computers become damaged after a loss of power or equipment failure which then causes the heat to rise further: or can cause a sprinkler system to activate ruining the equipment.

There is also Digital Asset Insurance policies which are not as widely known. Historically, digital loss was covered by a clause in an existing cyber security policy which assigned a very low indemnity value to the digital assets and generally covered damages from natural disasters only. New solutions have been developed to go hand in glove with cyber security, or property insurance.  The value of the lost digital asset can be set at the time coverage is bound and the asset can be insured for up to millions of dollars. The value is set by the underwriter and assigned an indemnity value based on actual value or the data which is lost.  It also features insurer approved back up and data management and can be purchased even whether the data is on the premises in a data server center or a cloud applications

Technology companies are at high risk of loss due to proliferation of new technologies and the correlating data and information produced.   These businesses are changing the insurance world’s appetite for risk, steering away from natural disasters, and focusing on processes guided by humans and products developed by humans with the aid of data and data processing.  In short technology companies are entering uncharted ground and will blaze a new navigational chart for insurance   providers and carrier as they proceed along their course.  Careful insurance planning is critical to the company’s health so they are not blown off their course due to loss of data from error, theft, mistake or any other event.

 

What are the diverse needs of a Retail Business?

Retail Businesses, Cyber Liability & Cyber Security Insurance

Retail

Accepting credit card payments at your retail location makes you part of the Payment Card Industry (PCI stands for Payment Card Industry).  The PCI Security Standards Council, which is a voluntary council, has issued Data Security Standards dealing with cyber security for credit card data  (PCI DSS) which are voluntary regulations for the Payment Card Industry.  In particular, the council issued PCI DDS Requirements 5 and updated V3.2 in May of 2016 which impacts retail stores substantially.

 

The most important aspect of these regulations in regard to retail sales is that non-compliance with the voluntary regulatory standards to prevent a data breach can result in making your organization ineligible to be a point of sale for credit cards.

The Council itself does not have compliance enforcement ability over the retail industry.  This power rests with the credit card companies who are the founding members of the Council e.g. Visa, Master Card and American Express. Thus, these regulations have far reaching impact on your ability to be a vendor who can accept credit card payments and as a result your compliance is necessary if you want to use credit cards. If you become ineligible of course it can reduce your profit.

Putting aside any theoretical discussion regarding compliance issues with voluntary  security standards, they are meant to protect the public by preventing data breach, so stringent guidelines were put in place protecting the consumer purchasing the products you sell from invasion of privacy, theft, fraud and identity theft due to payment by credit card under Requirement 5.

For those who are not computer savvy, Requirement 5 in a very condensed nutshell states you must protect all data systems against malware and regularly update anti-virus software of all programs. The sub parts further break it down in regard to the actions you must take to implement Requirement 5 which essentially means

  • you must take all possible steps to prevent a data breach by identifying all threats and detecting all known types of malicious software and malware,
  • ensure that all protection software programs are current and updated, perform periodic scans
  • document the scans in logs and track everything you do to keep current,  ensure that all antivirus and malware programs can’t be disabled or turned off.
  • If you have to shut down the anti-virus and /or malware programs for a limited time frame for an approved legitimate reason you have to have authorization from your management, and
  • document all details in yours logs and run all security protocols when the programs are back up and running and perform a security scan. See the PCI Basics &  Quick Guide  for more detail. http://PCIcomplianceguide.org

Accomplishing all these tasks is very difficult to achieve. Not even the Democratic Party has been able to complete insulate itself from cyber-attack. So it is fair to assume that you might have some difficulty accomplishing all of the required tasks without a really top notch IT person or department.  There are Quality Security Assessors who specialize in conducting technical assessments of your compliance defense system.  See Cb Defense PCI DSS Anti-Virus  White Paper, Carbon Black Arm your Endpoints. http://www.coalfire.com

Numerous companies also sell antivirus and malware platforms that you can purchase and have the platform itself tested to ensure that it does comply with the PCI regulations.

While you may think all of this is unnecessary or over kill just think of the cyber-attacks against national retailers (e.g. Target, Home Depot and E-Bay).

If you are ever sued by customers for a data breach that occurs within your retail business, compliance with the PCI industry standards may actually support your defense as it is considered a best practice to comply with these security standards and it helps to establish that you used a high standard of care in dealing with data and client’s privacy.  Because you have a high risk for data breach it is in your best interest for you to have data/ breach/cyber security Insurance. In saying that, you also want to consider other insurance needs in addition to cyber insurance.

Most carriers offer retail establishments either a business owner’s package with a combination of: standard features including:

  • commercial general liability
  • business property and inventory with or without enhancements or stretches (interestingly property  coverage does not include an outdoor sign that is not attached to the  building so you would need a rider in that instance)
  • property in transit floater, or inland marine
  • business income loss with endorsements for utility outages and direct damages
  • worker’s’ compensation
  • e-commerce sales
  • burglary, theft or crime; and employee dishonesty
  • spoilage and a food contamination rider if you sell fresh or frozen food items
  • mechanical or electrical breakdown
  • Commercial auto if indicated.
  • And, most agents and carrier often suggest umbrella insurance.

But at the same time carriers and agents do not emphasize the need for cyber security or data breach, nor are they usually offered as part of a BOP.   This may be because this type of insurance is fairly new and the parameters for cyber insurance are not completely developed or formalized. While there is very limited cyber coverage in the business property insurance portion of the policy, it is insufficient for anyone who is required to meet the standards for payment card industry as this requirement makes it self-evident that there is a legal duty and a standard of care in the payment card industry and if you are negligent and fail to meet the standard it may increase your liability to your customers for a data breach.

Thus, any PCI retailer will want to ensure that the cyber security policy they choose has provisions for coverage of regulatory fines, notifications of customers, first and third party damages and defense coverage which triggers at the earliest moment possible.

Cable Installers Liability Needs

Cable Installers, are you an employee or a 1099 contractor?  (Or “The elephant hiding in the closet”)

There is a vast movement afoot in the cable and satellite installation industry to have cable installers become a 1099 contractor rather than an employee of the cable company.   See “Consider the Cable Guy”: The Grind Investigation Fund. Many major cable companies are requiring their employees to make this change involuntarily. Why you might wonder?

Well, this is a very effective cost cutting measure for the cable companies. They need people to install the systems, wiring and equipment that operate and control the media service they are selling.  This job cannot be performed without a human at this point in time. However, if cable companies utilize a fleet of 1099 contractor’s as cable installers instead of employees:

  • It reduces the employer’s costs considerably as the employer no longer collects or pays FICA or federal and state income tax on the cable installers.
  • Cable companies does not pay employer taxes in to the government.
  • Cable companies often charge the 1099 contractor cable installers for such things as uniforms, tools, equipment and use of a truck. Conversely, as an employee, the installer would most likely have received those items at no cost from the employer. These measures both reduce the cost and bring in revenue from the contractor.
  • A Cable companies also save vast amounts of money on reduced insurance payments as the burden of carrying certain types of commercial insurance switches to the 1099 contractor.  This reduces the number of employees and conversely reduces the premium cost for the employer as well.

So, if a cable installer begins working as a 1099 contractor they really are functioning as any small business owner would. The installer will need all the types of insurance that any company in the cable  installation business should carry including general liability, errors and omissions, business property, inland marine, commercial auto (if you are furnishing the vehicle), commercial property and loss of business income and perhaps an umbrella policy or a technology  policy.   As a 1099 contractor, you can obtain these as part of a business owner’s package or as standalone policies.

You should speak with your agent to gain knowledge about the best options for cable installers within the Class Codes your business comes under listed below:

Business Liability Category: TV and Media Installation

SIC Business Insurance Codes:

  •   4841- Cable and Other Pay TV Services

NAICS Liability Classifications:

  •   517110- Wired Telecommunications Carriers
    •   515210- Cable and Other Subscription Programming

Business ISO General Liability:

  •   Code: 91315- Cable and Subscription TV Companies

Common Workers Compensation Class Codes:

  •   7536- Cable Installation and Construction
  •   8901- Cable and Telecommunications- Office Employee
  •   7600- Cable TV or Satellite- Other Employees and Drivers
  •   6325- Conduit Construction- For Cables or Wires
  •   8742- Outside Sales Persons
  •   Code: 91315- Cable and Subscription TV Companies
  •   Code: 91315- Cable and Subscription TV Companies

Plus, as a 1099 you will need health insurance which covers your own health needs.  This means obtaining health insurance which is most likely not part of a group plan in most cases.  Individual health insurance is usually very expensive no matter who the insurance carrier may be.  An alternative is to join a union or an association of workers in this field that offers health insurance to its members thus forming a group (E.g. Communication Workers of America).

But the biggest concern related to insurance is Workers Compensation.

Since you no longer are an employee, just as you are no longer covered by the Cable Company’s group health plan, you are no longer entitled to worker’s compensation through your client the Cable Company.   That means even if you get hurt on the job while installing for the cable company at a property you were sent to by the cable company you are not covered by Workers Compensation. (There is that elephant hiding in the closet with a not so great surprise!)

Whether your required to carry Worker’s Compensation insurance for yourself (as a single employee) is another question altogether and depends on many things. Some states require that a single employee company carry workers compensation while other states do not. In some states you are exempt if you have less than 4 employees. Some states exempt members of an LLC.   Whether it is required by the state should not be the end of the inquiry because if you don’t cover yourself for Workers Compensation, no one else is, and you may be definitely letting the elephant loose to trample you if you are injured severely on the job. Additionally, your old employer (the cable company) who is your “client” who sends you out to cable company users homes to do installations can and often does require that you carry workers’ compensation and that you make the cable company an additional insured on your policy when you go out to install systems for their customers.

You may think you are covered by your own health insurance that you just bought, however; many times your health insurance carrier will deny coverage if you were injured on the “job” and if you don’t have workers compensation the injury is not covered at all unless a third party  or the cable company was negligent.

This can be quite a tragedy if you are injured and have not obtained the insurance needed to protect you.  The Bureau of Labor Statistics shows that 3 million workers were injured on the job in 2014.  So if you find yourself in the position of a new 1099 contractor make obtaining commercial insurance one of your top priorities.