Sunday, October 22, 2017

Business Insurance Update from CNC Insurance Associates. “ Artificial Intelligence Missing Human Advocacy in Insurance”. 10-22-17

It seems more and more calls are answered by robots. Call your credit card company, bank, even your electric utility and you are met with a voice activated robot that talks and acts like a human being. This is an example of artificial intelligence (AI) servicing our world of commerce. The insurance industry is now adopting this same approach. Call the 800 number and the insurance company robot is there to  process your premium payment, take your claim, and even make changes to your policy. The insurance industry looks at this as a major opportunity for cost savings as AI is replacing the need for humans. This also affects your local insurance agent or broker. If you can easily have your insurance transactions serviced by robots then what will you need your agents for? The answer to this question is advocacy. Your agent is your only hope to advocate against the very large and powerful insurance industry. Your local agent has relationships with company underwriters and upper management that can override the robots and help customers. Insurance is a confusing and complicated industry. As a consumer you have no hope of getting advocacy or having someone fight in your corner if you have to depend solely on the robots with programmed AI. This is becoming more and more evident as policyholders find themselves trying to find people to help deal with their service questions and problems. Don’t give up on human beings. Even more, don’t give up on your local insurance agent or broker. They are the only friend you will have in the tough game of insurance. Until next time be careful out there and know your risks.

G. Kevin Nemith,
 Area President & Managing Director CNC Insurance Associates & The Hilb Group

Sunday, October 08, 2017

Business Insurance Update From CNC Insurance Associates. “ Injured Employees Return To Work The Most Important Road To Recovery” 10-8-17

Studies have made it very clear that injured workers that can return to work quickly, do better in their long term recovery.  In other words the faster they can return to their jobs the lower the total cost of the work comp claim. However this usually requires a light duty transition job that most employers just do not have available. The absence of light duty work, keeps injured workers home and this usually means a more costly claim. In addition in some States, the rules for offering a return to work job are extremely rigid and hard to adhere to. This also keeps employers from offering these programs.
Regardless of the obstacles, every employer should try to get their injured workers back as soon as practical. If this means going through the effort to create a light duty job offer, it will be well worth it.
Keeping work comp claim cost down will keep insurance premiums down. Experience modifiers applied to your work comp rates will also be lower and your injured employee will be better off becasuse they are back to work. So all business owners  work with your insurance professional and legal team to put together a return too work program with a light duty transition job. It will pay for itself in the long term. Until next time be careful out there and know your risks.

G. Kevin Nemith. CNC Insurance Associates
Serving DE. MD, NJ, PA, & VA

Sunday, September 17, 2017

Delaware Business Insurance Update From CNC Insurance Associates " Social Media Increases Infringement Risk For Business Owners". 9-17-17

A recent copyright infringement case in the music industry has given insurance and risk professionals a cause for alarm.  The family of the late Marvin Gaye, won a verdict of 5.4 million and 50% future royalties from Robin Thicke and Pharrell Williams, for the song "Blurred Lines".  What is troubling about this verdict is that the award was for infringement of the "groove", and or "feel".  This is really unprecedented and could open up a slew of litigation around all types of media. Business owners using social media to promote and advertise their businesses could be held to a much higher standard when posting online. Determining that a business used the same "feel" in their advertising as another creator of content could really be a problem. Think of all the posting that is done on social media outlets that are "copy cats" of other posts. How about photographs and videos that are shared from one social media user to another? Is everyone using social media considered violating the copyright laws?  Common sense would think not, but this "Blurred Lines" case could open up a Pandora's box of issues.  The good news for business owners is your general liability policy may cover copyright infringement under Section B Personal Injury and Advertising. It is going to be interesting to see how courts rule in the use of online media. With millions and milllions of businesses participating in marketing themselves on outlets like Twitter, Facebook, and LinkedIn,  lawsuits for copyright infringement may eventually re-write the rules of social media use and sharing. Until next time be careful out there and know your risks.

G. Kevin Nemith CNC Insurance Associates & The Business Insurance Center

Sunday, September 10, 2017

Delaware Business Insurance Update from CNC Insurance Associates Inc. " More Thoughts On Self Driving Autos, Whose Liable ?" 9-10-17

Technology is changing the way the insurance industry looks at liability with auto insurance. More and more people are buying cars which practically can drive themselves. In actuality, many feel that drivers will not be needed, only riders, as cars will do the driving with no one behind the wheel. So now the question is, following an accident who is liable?  Answering this question will dictate the future of auto insurance. If drivers are no longer liable for accidents, then the insurance industry will have to charge much less for insurance. Are the car manufacturers, or technology companies that install the self driving features liable?  If this is the case then they should be charged the premium not the drivers. Does this mean that auto insurance for drivers will be dramatically reduced? I would think so. There is no doubt , auto insurance is about to be dramatically changed. Insurance companies will have to adjust their model from a consumer focus to a manufacturer or business focus. This will be a major loss of revenue for auto insurers and a great day for consumers. There are still a lot of questions surrounding this issue and only time will tell how it will shake out. Either way I see more money in the pockets of drivers as their auto insurance will be a lot less. Until next time be careful out there and know your risks.

G. Kevin Nemith President CNC Insurance Associates Inc.
serving DE, MD, PA, NJ, & VA

Monday, September 04, 2017

Delaware Business Insurance Update From CNC Insurance Associates Inc. " Does Your Landlord's Lease Make Your Business Repsonsible For His Building?" 9-4-17

Many business owners will sign lease of premise contracts and not really know what is in the fine print. Many leases today push all the risk to the tenant. This could be problematic if the insurance policies that insure a business, who is a tenant, do not match up with the requirements in the lease. This is especially true with damage to property. Many leases today are making the tenant responsible for damage to the leased building. No longer is the responsibility relegated to their leased space only. In today's rental agreements the tenant may have to pay for damage to the total building, responsible or not. These lease provisions are usually in the indemnification clauses of the lease. The clause may state that the tenant has to indemnify the landlord for damage to the building out of activities of the tenant. The tenant may not even be responsible and still have to indemnify. The insurance policy for the tenant may not be set up to cover the total cost of damage to a landlord's building. Here is an example:
A business owner signs a lease for a 1200 square foot space in a large commercial building that houses 25 other tenants. In the lease the insurance requirements has the tenant cover their own property and provide Fire Legal Liability for the cost of their rented space, let's say in this example $100,000  in coverage. However in the indemnification provision of the lease, it states the tenant has to indemnify the landlord for damage to the total building. One night a fire broke out in the tenant's space and spread to the entire building. The landlord is now looking to the tenant to repair and rebuild his building. The tenant only has the $100,000 of coverage that was required by the insurance portion of the lease. Unfair?, Not Right?  This is an actual example of how a lease can cause major problems for business owners. Before you sign a new lease get your legal and insurance professionals to review it with you. Getting the right insurance in place to match the requirements of the lease will avoid dealing with  uncovered damages that a lease would make you responsible for. Until next time be careful out there and know your risks.

G. Kevin Nemith,   President CNC Insurance Associates Inc.
Serving DE, MD, NJ, PA & VA

Sunday, August 27, 2017

Delaware Business Insurance Update From CNC Insurance Associates. " Standard Markets vs Surplus Markets, What's the Difference? 8-27-17

As a business owner you will be exposed to the insurance marketplace in various ways as you buy and use insurance. You will hear from your insurance professional terms like "standard market", and "surplus market" , and you may wonder what all this means?  So I thought I will go through this briefly to give you some clarification.
The insurance industry is regulated by the states. Each state will  license and monitor the activity of insurance companies that want to do business in the state. These companies are "admitted"  into the state and generally are determined to be "standard markets".  The state backs up the buyers of insurance from  "standard markets" if they cannot  pay claims. This is usually done with a guarantee fund set up by the legislature. "Standard markets" usually insure the risks that are considered normal risk or lower risk and cover the majority of the insurance needs for business.
Now when a business is a high risk business, the "standard market" will take a pass and will not want to write insurance on these businesses. This is where the "excess or surplus market" comes in to play. This market will cover the higher risk businesses and usually charge more premium to do it. The states still regulate these surplus companies but do not back policyholders if the company cannot pay claims.
So two major differences between "standard markets" and "surplus markets", is the backing from the states and the appetite to write low risk or high risk business.  There are a few more differences but as a business owner, just knowing the two major differences will help when dealing with business insurance. As always you can ask your insurance professional to explain more before you buy. Until next time be careful out there and know your risks.

G. Kevin Nemith. President CNC Insurance Assoc. & The Business Insurance Center
Serving DE, MD, PA, NJ & VA

Saturday, August 12, 2017

Delaware Business Insurance Update from CNC Insurance Associates Inc. " Business Owners Don't Forget to Insure Yourself" 8-12-17

You have built your business from the ground up.  You worked hard, and many hours without a day off have been the norm to get your business where it is today. You insure your buildings, equipment, autos, and employees,  however do you insure you ? The majority of business owners do not insure themselves. What happens to the business when something happens to you? Most business owners do not even think about this scenario. In reality most business will fail when the owner or "driver" dies or becomes disabled. It is only fair to the employees, vendors, and customers to make sure your business can go on without you. This can also apply to your best employees or managers that help your business run.
So what is the answer to this risk?  Life and disability insurance.  Key Man life and disability  insurance is a necessity for a business owner. You are the "Key Man" (or Woman) that make the business work,  so insure "you"!!  The premiums are deducted as an expense in most occasions and the policies are owned by the business. There are many options to put these policies in place and coordinating it with your financial planner is also a good idea. So talk with your insurance professional and discuss the options for life and disability insurance for you and the key men,  or women, in your business. Until next time be careful out there and know your risks.

G. Kevin Nemith President CNC Insurance Associates & The Business Insurance Center.
Serving DE. MD, PA, NJ, VA

Sunday, August 06, 2017

Delaware Business Insurance Update From CNC Insurance Associates Inc. "When Your #1 Supplier Can't Supply, Then What ? 8-6-17

Most business owners cover their loss of business income. This coverage is included in most business owners policies and is easily added to Propery & Liability package policies. But what happens when the business loses income because their main supplier cannot supply the products or services the business needs? This type of coverage is called Contingent Business Income. In today's "just in time" inventory supply lines, businesses do not stock as much as they use to. A business can order online at night and by the next day have thier supplies from their favorite vendor. However if a main supplier has a claim that prevents this "just in time" delivery, the business owner could lose money. This is especially true with specialty products or supplies that come from only one or two vendors. It does not take much for a business to lose income when their shipments of inventory are delayed. Customers do not want to wait for a new order to come in from other vendors that cause major delays. They will just look elsewhere. Don't forget to look into Contignent Business Income, as an added protection to your insurance portfolio. Talk with your insurance professional and do a risk assessment of your vulnerabilities. Be more aware if you have specialty products coming from only one or two suppliers. Until next time be careful out there and know your risks.

G. Kevin Nemith, CNC Insurance Associates & The Business Insurance Center
Serving DE,MD,PA, NJ, VA

Sunday, July 30, 2017

Delaware Business Insurance Update from CNC Insurance Associates Inc. " Claim Reserves Could Be Increasing Your Rates ! ". 7-30-17

So, you have to submit a claim on your business insurance. You call your insurance agent and or company and go through the process of getting your claim resolved. Depending on the type and the size, this process can be quick or it can be drawn out. Sometimes it is a pleasant experience and sometimes it is not. I do feel that the industry tries to make the claim experience with their policyholders a good one, but the insurance contract is complicated and it can cause tension between you and the insurance company. Most of the time claims are paid and you are able to move on to get back to business as usual. This is where we start the conversation about reserves. What is a reserve?  A reserve is a sum of money that the insurance company adds to the total claim paid out just in case more has to be paid later. These added amounts can increase rates as they are counted when determining the loss ratio of a business. Many times these amounts will be held against policyholders years after their claim was settled. If no one is tracking or advocating for the reduction or elimination of these reserves, the business owner will pay more than they should. It is important that you talk with your insurance professional about any possible reserves you may have on past claims. Find out if they are causing  your rates to go up and see if you can get them reduced or eliminated. Also, understand that a reserve benefits the insurance company and not you the policyholder. Be diligent and make the inquiry to your insurance company to see if they have continued to apply reserves against closed and settled claims. Until next time be careful out there and know your risks.

G. Kevin Nemith President of CNC Insurance Associates Inc. & The Business Insurance Center
Serving DE, MD, PA, NJ & VA

Sunday, July 16, 2017

Delaware Business Insurance Update From CNC Insurance Associates Inc. "The Other Part of Your Liability Coverage, Libel and Slander Coverage" 7-16-17

Many business owners do not know that their general liability policy will cover for libel, slander, copyright infringement, and defamation. Here are some examples. In the course of business you may have a claim from a competitor that accuses you of libel or slander.  This usually happens in competing for sales or bringing on new customers. Another  company in a similiar industry as you, may feel that your business ad slogan  or marketing campaign, is a violation of their copyright or their "trade dress" and this could initiate a lawsuit.  Now add social media and the ease of posting on the internet, and this risk has gone to a whole new level.
The general liability policy covers these claims under Personal Injury and Advertising. This coverage is in Part B of the general liability insurance policy. Limits of insurance for this coverage usually match the bodily injury and property damage coverage of Part A, which is the liability coverage most everyone is familiar with.  As technology allow businesses to reach more and more people, the risk of these advertising claims will make the Part B of the general liability coverage a very important one in the course of protecting your business. Until next time be careful out there and know your risks.

G. Kevin Nemith. President CNC Insurance Associates & The Business Insurance Center
Serving DE, MD, PA, NJ, & VA