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Risk Management

13 Sep

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5 Steps to Reduce Workplace Injuries

September 13, 2016 | By |

Ben Franklin once said, “An ounce of prevention is worth a pound of cure.” Workplace injuries accounted to $170 billion (OSHA) of costs paid by small businesses in the US. Direct expenses associated with worker injuries include medical care, lost wages, overtime, and additional training and human resource expenses. Further, indirect costs such as decreased productivity, lower morale, higher workers’ compensation premiums, damage to reputation or brand, and increased turnover quickly add up resulting in lost profits.

However, businesses can take a proactive approach to preventing worker injuries in order to reduce the costs involved with injuries. Here are 5 steps that a business can take today to reduce worker injuries:

Commit to safety and engage employees. Commitment to safety should begin with owners and upper management team members, and should be communicated clearly throughout the organization. Managers promote safety by following safety guidelines themselves and by modeling safe practices at all times, while encouraging employees to do the same.

Responsibility for safety should be assigned to appropriate team members. Safety responsibilities should also be included in employee job descriptions.

Internal meetings further increase awareness of safety initiatives and allow for open discussion on the importance of safety in the workplace. Initially, a meeting should be held to communicate management’s commitment to keeping employees safe on the job.

Analyze current operations and workplace hazards. OSHA offers several resources to assist employers in assessing safety. Self-inspection checklists are provided in OSHA’s Small Business Handbook and OSHA has an on-site confidential consultation program to assist businesses with analyzing workplace safety. Business insurance companies often offer loss control services to help with identifying potential exposures and reducing workplace injuries, and often have credits or discounts available for companies who show a commitment to safety.

Develop and implement an action plan to lower hazards. After safety issues are identified, implement a corrective action plan. Assign responsibility for follow through to appropriate team members, and use action steps and deadlines that can measured. Document hazards that were identified and the steps taken to prevent future injuries.

When an injury occurs, immediately perform an investigation to determine what happened and how the injury may have been prevented. Make appropriate changes to procedures in order to prevent future injuries.

Provide training to employees. It is imperative that employees understand how to perform their jobs safely. Consistent training should be provided that instructs employees on safety policies, safe practices, and actions to take in the event of injury. OSHA offers a large inventory of training resources. Insurance companies also often provide resources for safety training.

Monitor the safety program and adjust as necessary. Inevitably, industries change and procedures need to adjusted. Make it a point to revisit your safety program at least semi-annually and make adjustments as necessary.

By committing to safety and taking steps to protect workers from injury, businesses can reduce the costs associated with workplace injuries. The “ounce of prevention” taken today could result in future profits that are retained and invested rather than spent on worker injury costs.

At Pioneer Business Insurance Agency, we work hard at being accessible, helpful, and result-oriented. Learn more about us at PioneerBusinessInsurance.com. How can we put our expertise to work for you?

01 Sep

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What is Workers’ Compensation?

September 1, 2016 | By |

Workers’ compensation is a state-regulated program, and is required of certain employers by law in most states. It covers wage-loss benefits, medical treatment, and rehabilitation for employees who suffer a work-related injury or illness. Workers’ compensation also includes employer liability coverage, meaning that employees who receive these workers’ compensation benefits cannot file suit against their employer in connection with the work-related injury or accident, with few exceptions.

When an employee suffers a work-related injury or illness, the workers’ compensation policy covers the costs of the employee’s wages and medical care, and many workers’ compensation policies have programs which help to facilitate recovery and expedite return-to- work.

Premiums for workers’ compensation are determined by business classification and payroll. Classifications group businesses with like businesses, and these classification categories and determined by rating bureaus. Payroll is determined on an individual basis by a premium audit. A premium audit typically includes the insured submitting information about the business’s owners/officers, employee gross payroll, job descriptions, and subcontractors. When an audit is completed, the insured receives a statement that outlines the classifications, payroll amounts, rates, and other policy changes.

Cost Management

There are several ways an employer can manage the cost of workers’ compensation.

Choose your insurance agency carefully. Exclusive and captive agents are limited to offering only one carrier for workers compensation, while independent agents represent multiple insurance companies, and have the ability to compare policies for the best value.

Implement a formal safety program, such as written safety procedures, prompt claims reporting, and return-to-work programs.

Talk about safety with your employees. Provide training for injury prevention, and allow for meetings that address safety issues.

For more information on this and other insurance topics and coverage, please call our office.

22 Aug

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What is the Difference Between General Liability and Professional Liability?

August 22, 2016 | By |

Most of my clients are familiar with general liability and the need to protect their companies against general liability losses. Yet, professional liability is often just as important, but much less understood. In this article, I’ll give a brief description of general and professional liability and point out some of the key differences between them.

General liability is intended to cover damages to a third party resulting from bodily injury or property damage. General liability policies include coverage for premises liability, and often include coverage for products liability. Some examples of common general liability claims include slips, trips and falls at a business premises. Other examples include property damage or bodily injury caused at a customer’s home or place of business, or damages caused by a product that is manufactured or distributed by a business.

Professional liability, sometimes used interchangeably with errors & omissions (E&O), covers professional mistakes that result in economic loss to a third party. For example, if a professional is hired to make recommendations to improve a process and the recommendations result in financial loss rather than gain to their customer, the customer may claim economic damages.

There are several differences between general liability and professional liability. Here are  3 key differences:

1. Coverage Triggers-The coverage triggers that obligate an insurer to respond to a general liability claim are bodily injury or property damage. Simply put, there must be bodily injury or property damage in order for general liability coverage to apply.

In comparison, the trigger for professional liability is the notice to the insured of economic damage claimed by a third party.

2. Coverage Period-General liability policies are usually written on an “occurrence” basis, which means that the policy responds when a third party suffers bodily injury or property damage, regardless of when the claim is filed for damages. In other words, a claim could be filed for a policy that was in effect several years prior if the incident that resulted in damage occurred during the prior policy period.

In contrast, professional liability policies are often written on a “claims-made” basis, which requires that a claim be made during the policy term or within a specified period following the policy term. In other words, the incident must occur during the policy period and the claim must be reported within the policy period. Thus, if a claim is brought after the policy term in which the incident occurred, and there are no changes to the current policy to cover prior acts, there would likely be no coverage in place.

3. Retention-General liability policies often do not require a deductible or out-of-pocket expense in the event of a claim. Although, some general liability policies do include a small deductible.

In contrast, professional liability policies generally include a “retention,” commonly ranging between $1,000 and $10,000. The retention must be paid by the insured before the policy responds.

In summary, general liability coverage protects a business from claims resulting from bodily injury or property damage suffered by a third party. Professional liability protects a business from economic damage claims resulting from professional mistakes.

The examples above are some of the key differences between general liability and professional liability. However, it is important to discuss the unique insurance needs of your business and the specifics of your business coverage with a licensed insurance professional. At Pioneer Business Insurance Agency, we work hard at being accessible, helpful, and result-oriented. Learn more about us at PioneerBusinessInsurance.com. How can we put our expertise to work for you?

25 Jul

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What You Should Know Before Adding an Additional Insured to Your Policy

July 25, 2016 | By |

I often receive requests from my clients to add an additional insured endorsement to their commercial general liability (CGL) policy due to a contract requirement. It is not uncommon for a general contractor, a customer, a mortgagee or a lessor to require that they be named as additional insured to a policy. However, the policyholder should understand the endorsement and how it modifies their CGL policy before adding the endorsement.

What is an Additional Insured endorsement?

An additional insured endorsement allows a person or organization that would not normally be covered on a CGL policy to be added as an insured on the policy. The endorsement modifies the policy to afford general liability coverage to the additional insured.

Those requesting to be added as an additional insured generally see the endorsement as further protection should a claim be brought against them for damages caused by the policyholder. However, there are several additional insured endorsements, and whether the endorsement provides the coverage that the requester is actually looking for depends on the actual endorsement that is added.

What are the different types of additional insured endorsements?

The additional insured endorsement used most commonly today is the Additional Insured Endorsement CG 20 10. While this endorsement provides coverage to an additional insured for ongoing operations, the endorsement does not cover completed operations. Prior to 1985, the CG 20 10 included coverage for an additional insured “with respect to liability arising out of ‘your work,’” which encompassed both ongoing operations and completed operations. However, in 1985 the endorsement was changed and removed coverage for completed operations.

If coverage for completed operations is desired, the Additional Insured Endorsement CG 20 37 should also be added. This endorsement provides coverage for completed operations, but needs to be added along with the CG 20 10 endorsement if both ongoing and completed operations are to be covered.

Organizations who have the CG 20 10 11 85 endorsement (the endorsement used prior to 1985) added to their policy do not need to add the CG 20 37 to their policy because the pre-1985 endorsement covers both ongoing and completed operations.

Blanket Additional Insured Endorsements

Some insurance companies offer a blanket additional insured endorsement, which allows automatic coverage for an additional insured under certain conditions. The automatic coverage applies to additional insureds for whom the insured is performing work, and for whom the insured has a written agreement in place which requires additional insured status. While the blanket endorsement offers convenience, the requirement for a written contract needs to be understood by the policyholder and the person or organization being added as an additional insured. Should there be upstream parties, such as a general contractor that does not have a direct relationship or contract with a sub-contractor, there is also an additional form that can be added to cover the upstream party.

What else should you consider before adding an Additional Insured endorsement to your CGL policy?

When an additional insured is added, the person or organization named as an additional insured has access to the coverage provided by your policy. In other words, your policy limits could potentially be exhausted in the event that an additional insured seeks coverage for a claim under your policy.

Further, the policy could cover losses that the policyholder is not intending to cover. There have been documented cases of the additional insured endorsement being interpreted by courts to include coverage for damages that the were not caused by the negligence of the policyholder.

In conclusion, it is important to understand additional insured endorsements before requesting that one be added to your policy. Asking questions to determine what coverage is needed, considering the scope of coverage provided, and considering potential consequences prior to adding coverage will help you to be selective when adding an additional insured endorsement and manage your risk wisely.

At Pioneer Business Insurance Agency, we work hard at being accessible, helpful, and result-oriented. Learn more about us at PioneerBusinessInsurance.com. How can we put our expertise to work for you?

01 Jul

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How can I protect my business from data breach?

July 1, 2016 | By |

A data breach occurs when Personally Identifiable Information (PII), such as social security numbers, financial data, credit card information, or other identifiable information is lost, stolen, or viewed in an unauthorized setting, or accidentally released. If a business collects or stores PII, there is risk of data breach. Information can be hacked criminally, lost by mistake or negligence, or leaked through faulty systems.

Potential effects of a data breach include the loss of trade secrets and proprietary information, legal and forensic costs, regulatory fees, and notification expenses. Further, loss of consumer confidence could mean permanent damage to reputation and loss of business.

Insurance for data breach is available through many insurance carriers. Coverage includes first-party response costs such as legal and forensic services, crises management, public relations, notification expenses, good-faith advertising costs, and services for affected customers. Third party coverage is also available to cover defense and liability costs. Consulting services on preventing data breach may also be covered.

Preventative Measures

Preventative measures can be taken to protect PII and sensitive data and minimize the risk of data breach. Such measures include:

  • Identifying PII collected or stored by the organization and creating clear, universal policies for its protection
  • Encrypting programs, devices, and files containing sensitive data
  • Protecting wireless networks and avoiding unsecured devices or networks
  • Limiting third-party agreements and contracts and limiting information shared with third parties
  • Developing a response plan should data breach occur
  • Managing risk with data breach insurance

For more information on this and other insurance topics and coverage, please call our office.

27 Jun

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Why Your Business Needs a Continuity Plan and How to Prepare One

June 27, 2016 | By |

emergency-planA business continuity plan provides specific actions for a business to take when an unexpected event occurs that could potentially damage an organization’s financial health, reputation, or ability to compete in the market. According to a 2014 survey of midsize business conducted by The Hartford, while most companies have a business continuity plan in place, 33% of businesses have not documented their plan, and only 19% have tested their plan. These results indicate that most businesses are unprepared for a major unexpected event that could severely impact their bottom line and ability to recover after a disaster.

So, how does a business go about preparing a continuity plan? By breaking the process into manageable steps, and working on one portion of the plan at a time. While a continuity plan will look different for every organization, here is a 5 step process to developing a business continuity plan for your business to help you prepare for a disaster and recover quickly in the event that one occurs:

  1. Develop policy and organizational structure. Start by creating a business continuity plan purpose statement that details your reason for the plan and the objectives for the plan. Next, assemble a business continuity team within your organization and designate roles and responsibilities. Appoint a coordinator to lead the team and manage the plan.
  2. Conduct a business impact analysis. A business impact analysis helps to determine time-sensitive or critical business functions, and the resources needed to support them. Determine the people, places, suppliers, processes, and programs that are essential for your business to operate effectively.
  3. Identify major risks and assets for your organization. Some of the common risks faced by organizations today include natural disasters, malicious attacks, workplace violence, utility outage, system failure, fire, death of key employees, cyber attack, and mechanical failure. Assets that could be vulnerable to risk include people, property, supply chain, systems, equipment, information technology, business operations, reputation, regulatory requirements, contractual obligations, and environment.
  4. Determine and implement prevention and mitigation controls. Preventative measures help to prevent a disaster from happening in the first place. Some examples of preventative controls include installing fire and security alarms, using secure passwords and encryption, keeping business valuables in a secure location, and general housekeeping in the office to prevent injuries. Mitigation policies give direction for minimizing a loss that a business suffers and the interruption of business processes after an event. Mitigation controls should address emergency response, employee communication, public relations, and resource management.
  5. Prepare employees. Employees should understand their role in business continuity after a disaster. If an employee is expected to take action, they should be familiar with the plan prior to an event occurring. The plan should be tested to ensure that employees fully understand their role.
  6. Secure insurance to transfer risk. The risk of catastrophic events can be transferred through insurance. Talk with an insurance agent to discuss coverage that meets the exposures faced by your organization.
  7. Test the plan, review the plan and make changes as needed. Once the continuity plan has been developed, it should be tested prior to implementation. Once the plan is in place, it should be consistently monitored. The business environment is always changing, so it is essential to review the plan at least once per year. Additionally, the plan should be reviewed and changed as necessary when there is a change in staffing, processes, suppliers, or facilities.

By taking the time to develop a business continuity plan, you can prepare your organization for an unexpected event. Ultimately, your continuity plan could prevent disasters from occurring in the first place and help your business to recover more quickly should a disaster occur.

At Pioneer Business Insurance Agency, we work hard at being accessible, helpful, and result-oriented. Learn more about us at PioneerBusinessInsurance.com. How can we put our expertise to work for you?

08 Nov

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Safety first! Prevention for Cumulative Trauma Disorders

November 8, 2012 | By |

More than half of workplace injuries are caused by musculoskeletal disorders (MSDs), such as cumulative trauma disorders (CTDs).  In fact, $1 of every $3 of workers’ compensation costs are attributed to MSDs. Employers who are aware of risk factors, and take action to minimize these types of injuries ultimately benefit by controlling losses and improving the productivity of their workers.

What are Cumulative Trauma Disorders?

CTDs are injuries of the musculoskeletal and nervous systems attributed to repetitive motion, over-exertion, vibrations, pressure from hard surfaces, and prolonged or awkward positions. Disorders associated with CTDs include carpal tunnel syndrome, tendinitis, low back pain, bursitis, and several others.

Who is at risk?

Employees who perform repetitive motions are especially susceptible to developing CTDs. Office employees who spend extended periods of time working at a computer, and manufacturing employees who perform repetive motions (such as snapping a part in place) are among those most at risk.

What can I do to prevent or minimize CTDs in my company?

First, Employers should increase awareness of CTDs, and the risk factors that contribute to these types of disorders. Designate someone on your staff to handle safety at your workplace, by researching safe practices and ergonomics (the process of adjusting workstations for safety and comfort).Your business insurance agent should also be able to provide you with helpful resources.

Next, talk with your employees about the importance of good posture while sitting or standing for extended periods of time. For example, while sitting at a computer, feet should be flat on the floor or on a foot rest, the head should face forward with a slight tilt downward, wrists should be in a nuetral position, and elbows should be within a 70-135 degree angle. Encourage employees to take short breaks to reduce injuries caused by sustained positions, and to consider deep breathing and stretching when in the same position for an extended period of time.

If you would like to learn more, visit us at PioneerBusinessInsurance.com, or call us at 888-596-7242. At the Pioneer Business Insurance Agency we work hard at being accessible, helpful, and result-oriented. How can we put our expertise to work for you?