GT Insurance Blog

Insurance problems and cures

Posts Tagged ‘risk management

Business Continuity – Disaster vs. Recovery

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25% of businesses do not reopen after a major loss.

48% of businesses do not even pretend to have a business continuity plan.*

But 95% think they are prepared.*

Is your plan only keeping your insurance policy somewhere safe?  (Which is not the worst start in the world, but it’s grossly inadequate.)

Do you have tasks for each employee after a disaster?  (Did they actually agree to them?)

What would actually be a disaster for your company?  (Flood, hurricane, fire, data breach, lawsuit, death of an owner?)

Yes, sometimes  it seems like the Four Horsemen of the Apocalypse, but these things really do happen.

There are many small businesses which would suffer less from a flood than from a cyber breach;  doctors, lawyers, insurance agents, consultants, architects come to mind.

There are many small businesses which would suffer less from a hurricane than they would from the death of an owner without a succession plan, or adequate life insurance.

Spend a few hours once a year to prepare a continuity plan; surviving a disaster will be much more pleasant if you do.  Then talk to your insurance advisor so you know if you have money to help you recover.

*Travelers Insurance survey result

GBW Insurance/AssuredPartners 855-467-2877, extension 677

Cyber Liability – Is your website infected?

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As though there weren’t enough problems, websites can be compromised, becoming sources of computer virus infection for your clients. Talk with us about #CyberLiability and #DataBreach insurance. 1-800-548-2329.

Google’s survey says there are many more compromised legitimate sites than there are sites designed to spread malware.  Click here for a commentary from our client IT Radix and access to the Google Malware Dashboard.

Once a legitimate site is compromised, all the unpleasant things you’ve heard of start happening: malware recording your entries or your clients’ entries, spreading viruses, and so on.  Your site is likely to be black listed by search engines.  It takes a long time and a lot of work to come back from that.

As soon as IT Radix scared us with this topic, we ran out to their suggested screening site  http://sitecheck.sucuri.net/scanner/ and checked our sites.  Everything was fine, today.  Our site providers keep track of this, but with the damage that we could face, it’s important to keep checking, and to keep our insurance in place.

Flood Insurance Maps in New Jersey

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Flood insurance takes 30 days to put into effect. So start now if you want it when you need it.  Try our site for quotes.  Click here, fill in what you can, and we will help you get a quote. (Remember to fill in the security code at the bottom.)

Here is a link to the new flood insurance maps in NJ. This uses National Flood Insurance Program (NFIP) data (part of the Federal Emergency Management Agency or FEMA).

While we can’t guarantee these maps, because we don’t control the site, they have been useful to us in counseling clients.  There have been winners and losers in the new maps; some New Jersey areas have been moved to lower risk designations, many have moved to higher risk and higher costs.

With new maps in place, individuals whose property was damaged by Hurricane Sandy now know how high they have to raise their property to qualify for lower rates.

But keep an eye on rate changes.  While the FEMA/NFIP program states that prices will rise under caps, the caps come off when you make certain changes.  That’s when you see the headlines about people whose flood insurance rate has gone up 100% or even 1,000%.

If you have questions, need some advice, want to change agents, or need to start a flood policy, please give us a call at 1-800-548-2329, extension 117.   Para Español, ext. 110

Who owns your company’s data? How do you make sure?

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You own your data, but you have to take steps to make sure you can control it, both legally and in the cyber world.

Do your employees use only devices your company owns?
Have they acknowledged that their information on those devices is not private?

If they use their own devices to access your information, have they agreed to let you review any and all information on those devices?
Have they agreed to let you wipe their devices if you find your information on them?

All of this should involve help from your own lawyer.

Even if you get a signed acknowledgement that you can look at their information and look at information on devices they own, you’d better be talking to your own lawyer if you run into a communication between your employee and his or her own attorney.

On the IT front, a good IT provider can help erect barriers to penetration by outsiders, and to theft of data by insiders.

But multiple platforms are complicating IT.  Mobile malware is exploding.  And many small businesses don’t keep current with firewalls and monitoring of data use.

If you’d like to discuss IT issues in more depth, try this link to IT Radix.  And we thank them for putting on the seminar that provoked many of these questions today.

The legal questions in the seminar today were posed by Colin Page, Esq.  Try this link to make contact with his law firm if you have questions on data ownership and employment issues.

Insurance and Employment Law – Outsourcing

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What happens when you outsource jobs?  There are benefits to outsourcing in the right circumstances.  But what problems can come up and what should you do to protect your business?

  1. If the workers are not your employees, they can escape the Workers Compensation system and pursue law suits against you.   If you don’t set it up correctly, you may violate State and Federal labor laws.  See the link below for Colin Page’s blog page laying out a real case of a problem blowing up in the employer’s face.
  2. If you create a 1099 relationship, making someone an “independent contractor”, you have to be very careful to make sure the relationship truly qualifies as an independent.  If you want detailed advice on those rules to observe, on how to stay out of trouble with your State Board of Workers Compensation and Department of Labor, and lawsuits, click on the link below to William Barrett for legal advice.
  3. Employees are generally entitled to Workers Compensation benefits if injured; in New Jersey there are very few exceptions.  Non-employees can sue outside the controlled environment of Workers Compensation.  Make sure you have someone else’s insurance in front of yours; if you have a contract with someone who doesn’t have Workers Compensation, you are probably going to be providing it.
  4. You should follow basic risk management procedures.  If you contract jobs out to another company, get their certificates of insurance for Workers Compensation and General Liability.  Have them name you as an “additional insured” on their policies.  Make sure you have your own Workers Compensation, General Liability, and Employment Practices Liability insurance policies.

For more detail or to kick ideas around, we’ve given you links below to some intelligent lawyers and to our own contact information.

Here’s a link to the Chair of Corporate Law at a large NJ law firm.  Bright lawyer, William Barrett, who has been very solid for us.

Here’s a link to a Colin M. Page & Associates blog with comments on problems with outsourcing work.

Here’s a link to information on Employment Practices Liability Insurance.  GBW Insurance, 3 Gold Mine Road, Flanders, NJ  07836.  1-800-548-2329

Insurance Company Financial Stability

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Insurance companies are rated for financial strength.  Why does that matter?

Insurance is a promise to pay future losses.  If the company does not have a future, no payments.  And some losses are going to happen years down the line.

Property losses tend to be settled shortly after they occur.  You owned a building, it burned, the value is usually relatively easy to establish, you are paid for the loss.  The solvency of your insurance company is not of concern because of time, but because property is exposed to catastrophic threats such as hurricanes, which might bankrupt a small insurance carrier which has not prepared properly.

Liability losses, especially large losses, are usually litigated.  That can take years.  If an insurance company becomes insolvent, that will at a minimum complicate and delay settlement and payment.  An insurance company which misestimates its average losses far in the future will be in trouble.

So, how do you assess the strength of your insurance company?  While states review the strength of insurance companies within their supervision, day to day the best measurement is available from private companies that specialize in rating insurance carriers.

Without getting into a long discussion of the relative merits of the rating companies, one of the best is A.M. Best.  Ratings run from A++ to F, with additional notes for the future (stable, negative, favorable).  Here’s a link to Best’s explanation of their financial strength ratings.    You can sign into Best for free to get basic rating information on most insurance carriers.  (Some decline to submit their results for rating.  Not a great sign about the company.)

Or call GBW Insurance at 1-800-548-2329 and we can give you the information.  We are also paid subscribers and are therefore able to access detailed information as well.  www.GBWinsurance.com

Prepare for disasters in advance

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Hurricane season for 2013 starts in less than a month.  Preparing in advance may take more time than we have before the next hurricane.  Or you may have a couple of years before the next major hurricane strikes you.  Either way, here are some locations for preparation advice.

Residential preparation: Click here for the DisasterSafety.org pamphlet on preparing for hurricane damage to homes.

Or go to this GBWInsurance.com link for more catastrophe preparation and response info and suggestions from Travelers Insurance and Hanover Insurance.

Business preparation: Click here for the DisasterSafety.org page leading to a full business recovery preparation program.  This is an excellent introduction to developing a step by step business recovery plan.  If you would like help with this or additional resources, call us at 1-800-548-2329 ext. 101

After two years of significant hurricane damage in the Northeast, we should all be on our toes about catastrophe preparation and catastrophe insurance (flood and windstorm).  The odds of another serious storm are exactly the same as they were in 2011 and 2012.