Risk & Business

The media coverage of the rioting and civil unrest in Ferguson Missouri, showed damage beyond imagination. Small businesses were looted, burned, and destroyed by protestors. This event is an ongoing problem for the business owners in the town. Rebuilding and getting back to normal will take a long time and will depend on insurance.  Commercial insurance policies will pay for the damage and also for many, the loss of  business income. Long term insurance issues could be down the road however. Once insurance companies pay millions of dollars of claims in Ferguson, the insurance industry then has to decide if they are going to continue to make insurance available for the town. Also underwriting standards and criteria may make rates skyrocket.  The insurance industry will have to evaluate if the town is still a high risk for future damage & losses. This will determine if Ferguson business owners will have adequate and affordable insurance down the road.  Let's hope that they will.

This blog usually is written about topics that affect the risk and insurance issues of small business. However, I ran across an interesting article regarding the sales of Pet Insurance. I was curious to understand why this insurance product was outselling health insurance and life insurance. In other words, people are buying better protection for their pets than themselves. Veterinarian costs have gone up and pet medicines have gone up, but that doesn't fully explain the sales explosion.  The availability of new surgical procedures and treatments has increased but that doesn't fully explain it either.  When it comes right down to it, our pets are our family and we will do anything for them. Most people who buy pet insurance just want to make sure they have enough dollars to do the things they need to do medically to help their pets. Until next time be careful out there and know your risks. G. Kevin Nemith President CNC Insurance Assoc. & The Small Business Insurance Cente

Reinsurance is unknown to most small business owners. Actually, the term and the concept of reinsurance has probably never been discussed in broker/client insurance meetings.  So why bother? Reinsurance is going through an historic change. This change may affect the overall insurance market sometime in the future which could create insurance issues for small business.  So let's break it down. Reinsurance, insures the insurance companies. They are at the top of the heap in the insurance world. The reinsurance industry makes sure that insurance companies can pay really big losses and claims that otherwise would bankrupt them.  The reinsurance industry is under fire right now as new money comes to the top of the insurance food chain. Hedge funds and other money funds  are telling underlying insurance companies that they can cover the really big losses as good as reinsurance but can do it at a lessor cost.  This has given the reinsurance industry competition it has never really seen b