Risk & Business

The National Insurance Crime Bureau (NICB) has reported the amount of suspicious insurance claims has risen this year 13%. Suspicous car fires, auto glass claims,and product liability claims are up 20%,76% & 90% respectively. Also double billings on work comp claims have also increased. What is going on? Well I think it has to be recession and economy related. As a business owner , part of your risk managment thought process has to take into consideration your vunerability to insurance fraud . As money gets tighter people look to insurance claims as a way to get income. It is hard to catch and prosecute insurance fraud , so be aware. Your risk planning should include being more engaged in your claims with the insurance adjusters. Try questioning everything and everybody that you may know that is invovled with the claim. Keep your ear to the ground and report any suspicious issues. It will take a team to catch fraud committed against you and your business. Until next time,...

It is a proven fact that businesses that focus on loss control, safety and risk management pay a lot less in business insurance premiums. When compared to thier respective peer groups , these businesses can pay 20-30% less in business insurance costs. However with the lingering recession , many business owners over the last few years have cut spending money on safety and risk management programs, only to see their loss histories deteriorate. Though most business owners have yet to see their rates go up because of the soft, highly competitive insurance market, the true costs will come home to roost when the insurance market starts to "harden" rates next year. If you have cut your safety programs, put them back in place. It might be real hard to find the money, but you will be glad you did when the commercial insurance market changes and "punishes" businesses with poor loss histories. Until next time remember if you know your risk and can measure it then you can c...

It's not widely known by the general public but insurance companies have been steadily losing income the past couple years, mainly due to their self inflicted premium reductions which occur every few years. These premium reductions cause what's known in the industry as a "soft market". This has been the industry's way of increasing individual companies' policy holder share through premium reductions of 20 to 40%. The problem is that in the midst of their soft market the industry has been hit with some large losses and one of their primary sources of income, investments, has been severley damaged due to the recent economic downturn . They are in a bind currently due to this economic downturn since their usual remedy was increasing premiums. This remedy can't be their quick solution since many business are struggling with their own economic difficulties and can't afford the increased premiums. An article in Property-Casualty.com states that prop...

Image by gullevek via Flickr Something that insureds should be aware of, contractors in particular since this practice is widespread in their industry, is the fact that Additional Insured endorsements can often reduce the actual coverage available to them, the actual Named Insured. In a recent article in The Insurance Journal, Chris Boggs , the author , sited the case of a large construction company that required one of it's subcontractor 's to add them as an additional insured to the sub's general liability policy. Subsequently, the subcontractor hired another subcontractor to complete some of it's responsibilities. This is where it gets hairy. The subcontractor hired by the original subcontractor had an employee injured on the site by another contractor, also hired directly the the large construction company. The employee's company filed suit against all parties, the main contractor and also the subcontractors involved in the event, either directly or i...