Certificates of Insurance Under Scrutiny

The days of changing certificates of insurance to match contract requirements or holder requirements are over. First, the new 2010 certificate is copyrighted and agents cannot change the terms or wording. Also many States now have regulations against agents or brokers changing the certificates and insurance professionals could lose their license if caught. So what is the answer going forward? Not really sure. To clients they don't care as long as the certificate holder is satisfied. Saying no to a client that has promised insurance coverages that cannot be delivered is very tough for agents. In addition many clients sign contracts in which insurance terms are not avaialble or impossible. These business owners could face possible breach of contract claims. So it is time for the industry and business to really understand certificates and what they mean. A certificate of insurance is not an insurance policy. Also contracts are going to have to be written so that insurance terms can be obtained. The answer lies in getting rid of certificates and send copies of insurance policies to holders. In the email age this is not a problem. Maybe when holders or those that let contracts have to read 1000 page insurance policies to understand if their requirements are met, they will change what they are requiring. Until next time be careful out there and know your risks. K

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