The Bull Stops Here Blog

What small businesses can  do right now to start 2010 with the upper hand?

Small businesses  notoriously overpay for their insurance due to lack of risk management  strategy.  If you were to commit to a strong approach to your  insurance, safety practices, risk management and forecasting, you would  be able to save money in 2010 on your premiums, as well as improve efficiency  and profitability.

Here are a few tips that you can implement today that will minimize risk and maximize profit:

1 – Get a  complete diagnostic of your safety program.  Injured employees cost  small businesses money in increased workers compensation premiums, loss of  time, and hiring or moving people to replace the injured worker.  Offices  have a huge issue with ergonomics, as this accounts for 50% of workers comp  claims in the country.  Being able to identify exposures and put safety  practices into place to alleviate them will have a direct impact on their  bottom line.

2 – Bid out insurance.  The insurance market is still  “soft,” meaning that premiums are down and competition for business among insurers is up.  Not looking at all possibilities is simply not prudent  and can be expensive.  Regardless of when their renewal is, they should  make a commitment to aggressively bid out their insurance.

3 – Get a  complete diagnostic on your property and casualty insurance.  I rarely  find a policy that can’t be adjusted to save money.  Normally, business owners leave the programming of their policies to the agent or broker without  getting involved.  This is an area that with proper attention could  immediately improve the program by cutting costs and/or preventing uncovered  claims.

4 – Consider Health Savings Accounts (HSA) for medical  insurance.  The programs will vary among states and insurers, but this is  a real option to save money for the employer and actually provide a flexible  policy for the employee.  I had a client that saved $6,000 a month making  the switch last year.

Start off this new year and decade the right way for your business. Minimize your risk and maximize your profit by implementing these strategies today!

© 2010 Dan Weedin - All Rights Reserved

This is an article in today’s Scottrade Stock Market News where I am interviewed on the Tiger Woods fiasco. Companies that hire celebrities to endorse their “brand” face liability issues. Insurance companies are not in the moment if they miss this opportunity to protect their clients. Insurance buyers who engage in hiring celebrities are missing the boat if they don’t look into transferring all or part of the risk.

Read the article

Five items you can do to do to make sure your audit goes smoothly:

1 - Make sure you know the class codes that are being used to rate you for liability.  They will be a description of your operation.  You will find them on the General Liability section of your insurance policy.  Ascertain if they are correct and complete.

2 - Make sure you know what your rating basis is for liability.  The options will be gross sales, payroll, cost of materials, or area (sq. feet). Determine if the correct basis amount was chosen.  If it’s too low, you will owe money at the end of the policy period.  If it’s too high, you are paying too much and can improve your cash flow.  Depending on the policy, you might not even get it back!

3 - If you’re a contractor, understand the maximum limit you can be rated for on payroll.  It may vary per state.  In Washington State, it’s $600/week or $31,200/year maximum for any laborer.  Ask your agent if you don’t know.

4 - Ask your agent or consultant to attend an audit meeting with you.  If it’s done by mail, ask them to help you complete the forms.

5 - If in doubt about your rates at any time, ask!  It’s better than being surprised.

Be safe…

I was just quoted in the November 7th edition of the Daily-Journal (IL) on Renters insurance -

“Dan Weedin, a longtime insurance and risk management consultant based in Washington state, advises renters to purchase renter’s insurance for another reason: Liability coverage. He said it can cover a renter’s responsibility to other people injured at his home — whether the renter, his relative or pet caused that other person’s injury. “One bad liability claim (slip, fall, and disability) at your apartment during a party where alcohol is served, can be catastrophic financially,” Weedin said.”

Thanks to AntonioYoung for including me. You must be an online subscriber to read the entire article, which is excellent.

Last weekend, I watched my team, the Seattle Seahawks beat the St. Louis Rams 28-0.  At first glance, it looks like a route, right?  In reality, with 49 seconds to go in the 2nd quarter, it almost was 7-7.  With the Seahawks up 7-0, Olindo Mare lined up to attempt a 49-yard field goal to increase Seattle’s lead.  The FG attempt was blocked by the Rams, scooped up and returned for a touchdown.  Talk about a stunned crowd!  The Rams were soon the ones stunned as it turned out they had 12 men on the filed (for you non-football readers, that’s one more than allowed).  I guess it’s easier to block field goal attempts with that extra guy.

That penalty turned the game around. Seattle was given a first down and they went in to score another touchdown, giving them a 14-0 lead at halftime, rather than a tie game.  The Rams never recovered.

Take a look at your business and how it operates.  Are there potential “12th men” in your operations?  Here are a few to consider:

• Poor housekeeping
• Inconsistent safety meetings
• Poor recordkeeping
• Faulty wiring
• Poor hiring practices
• Discriminatory practices
• Not understanding your insurance

You see, any one of these, plus many others, can be potential game changers.  Just like the Rams, you lose one of these and you might never recover.  Don’t be penalized for lack of discipline.  If you practice sound risk management strategies and stick with consistently, you will find yourself the winning team.

Be safe.

If you are a business owner who insures all your vehicles on your commercial auto policy, you may have a huge gap to fill.  In my experience, business owners who do this don’t take out a personal insurance policy.  This leaves out one big area of concern.

A personal auto policy insures you when you drive someone else’s vehicle.  Here are two examples:

1. You borrow your neighbors truck and get in accident.  Insurance follows the vehicle, but what if it was uninsured or underinsured? You are now responsible.  Actually, you could still be brought in just for your negligence.
2. You rent a vehicle for personal use on vacation.

The commercial auto policy has no provision to cover you while you drive a non-owned vehicle for personal use.  You need to purchase an endorsement called “Drive Other Car” coverage.  This attaches to your policy and picks up the coverage you lose by not having the personal auto policy.  It is relatively inexpensive (about $150 per year) and closes a major gap.

If you are a business owner without a personal auto policy because all your vehicles are insured commercially, then make sure your agent has purchased Drive Other Car coverage for you.

Be safe and be well.

Personal Insurance Tip BONUS-

If you’re a fireworks home-gamer this weekend, keep that water hose handy. Roofs can be magnets for debris. I actually recommend you keep the pyrotechnics to the professionals, but that’s just me.

Here are my concerns for your safety:

1. Fire to your house (again watch that roof) - Property insurance
2. Fire to your neighbors house - Liability insurance
3. Blowing off your hand or other appendage (ouch) - Medical insurance
4. Hurting yourself and keeping you off work - Disability insurance
5. Injuring your kids - the ULTIMATE hurt.

Enjoy the weekend but be safe.  Oh by the way, watch out for drunk drivers.  I know you won’t do that, right?

Be safe and be well!

Dan

I just finished a new position paper on insurance for home based business entrepreneurs.  It’s free for the asking.  Just e-mail me your request and I’ll send you the paper.  If you’re a home-based business of any kind, this is information you must have to protect your business.

My e-mail is dan@danweedin.com.

Be safe and be well.

This just in courtesy of JJ Keller…

The U.S. Equal Employment Opportunity Commission (EEOC) announced that workplace discrimination charge filings with the federal agency nationwide soared to an unprecedented level of 95,402 during Fiscal Year (FY) 2008, which ended Sept. 30. This level is a 15 percent increase from the previous fiscal year.

According to the FY 2008 data, all major categories of charge filings in the private sector (which includes charges filed against state and local governments) increased. Charges based on age and retaliation saw the largest annual increases, while allegations based on race, sex and retaliation continued as the most frequently filed charges. The surge in charge filings may be due to multiple factors, including economic conditions, increased diversity and demographic shifts in the labor force, employees’ greater awareness of the law, EEOC’s focus on systemic litigation, and changes to EEOC’s intake practices.

The FY 2008 data also show that the EEOC filed 290 lawsuits, resolved 339 lawsuits, and resolved 81,081 private sector charges. Through its combined enforcement, mediation and litigation programs, the EEOC recovered approximately $376 million in monetary relief for thousands of discrimination victims and obtained significant remedial relief from employers to promote inclusive and discrimination-free workplaces.

What are you doing to reduce your risk?  Nothing?  Check back on my blog for articles on how to avoid this issue.  If you have questions, please call me and we can discuss how you can be best protected.

Be safe and be well.

I have a new article on ResourceNation on Employment Practices Liability and how to prevent lawsuits from employees.

To read the article, click here.