National Disaster Plan - more contributions to the small business owners insurance premium

Here's another example of "proactive" government in action. According to a post entitled "What Florida really wants - other peoples money" in one of my favorite blogs, RiskProf, John McCain, the nominee for the republican nomination for President, does not support a national catastrophe plan, while the democratic nominee for President, Barrack Obama, and some governors do. Of course what this really means is that those of you not living near a coastal area could still end up subsidizing those of you that choose to. The main thrust of the disaster plan would be to create an emergency cash reserve set up for states to access in the case of future natural disasters, such as Hurrican Katrina or rampant wildfires. This fund would be federally managed, always a cause for concern, with funds contributed by private insurance companies. Obviously the governors that are vocally backing this plan happen to preside in coastal areas. As Mr. McCain stated, this would expand the role of the federal government into the private insurance market. The problem as I see it is that we already have a federally supervised flood program in place. Some states, such as Florida, already have their own disaster funds. It seems that while the populist message of their governor, laying high insurance costs at the feet of insurance companies, and adding more state regulation to said companies, isn't enough. It looks like the funds are lacking should a large scale disaster hit them, so what better way than to support a national fund to help backstop their fiscally faltering local initiatives. Either way, more government involvement will add up to higher premiums for small business owners and the public in general.

Popular posts from this blog

Delaware Legislature Preparing To Revisit Dram Shop Liability

Here we go again. Representative Peterson is preparing to introduce limited dram shop liability for consideration. The legislation caps the liability at $250,000 but, as is usually the case, this creates a starting point where limits are eventually increased once it's decided by the powers that be that the current limit is too low. This also puts restaurants, bars, etc, at an increased risk due to the vague wording of the legislation, specifically "reckless" sale of alcohol by the business. Also, you can be sure that if this legislation is passed, that rates will go up commensurately for not only Liquor Liability coverage, but if actual damages begin to be paid out under this law, that insurance rates on the whole will see an increase.
Read more

Get employees back to work quickly to keep work comp costs down

Image
In the past I have spoken to clients regarding a particular workers compensation claim affecting them and have asked if they have brought the employee back to work yet. Too many times the answer is no, they have nothing for that employee to do since said employee is not 100% and unable to perform their specific job prior to their workers compensation injury/claim. The problem with this is that too often employers miss the point that even though an employee can't perform in the position they were in prior to their injury, it behooves the employer to create some type of alternative task/job the employee can do until such time they are able to resume their normal duties. Bringing that employee back to work means that work comp benefits /payments in that particular claim are being curtailed, thereby saving the employer potentially more being paid out, while adding to their experience mod and driving their overall work comp expenses up.
Read more

Important to notify insurance company of potential liability claims

Image
When trying to manage their insurance policies, many business owners make the decision not to turn in potential claims and decide to take care of them on their own. By paying for small claims, such as property damage, etc, they strive to keep claim frequency down and in turn keep renewal premiums down. One area of insurance they should not try to manage though is potential liability situations/claims. Most policy conditions require prompt notification of any potential liability claims to the insurance company and if a claim isn't turned in promptly, the policy language does note that the company can deny a claim due to late notification. It's important to do this early on since information/memories are still fresh and it gives the insurance company time to completely investigate the potential claim. The potential for a liability claim is most likely the small business owner's greatest area of risk, whether they operate a restaurant, cleaning service or any other busi...
Read more