Insurance Insights: The Cleary Insurance Blog
The Cleary Insurance blog covers insurance, risk management, and financial planning for New England businesses and individuals. Our team of licensed advisors and specialists publishes regular articles on commercial and personal coverage, employee benefits, life and financial planning, and insurance compliance. Browse recent articles below, or use the category filters to find topics relevant to your business or personal situation.
Earthquake Insurance
Why It’s Important for Everywhere
When most people think about earthquakes in the United States, Alaska and California are the first two states they think of. However, Tuesday’s earthquake in Virginia shattered this idea. The initial 5.8 magnitude quake was followed by several aftershocks, which were felt as far away as Georgia, Chicago and Toronto. Although there hasn’t been extensive physical damage, the feeling of safety many people had was shaken. Many residents of the larger cities on the East Coast relocated there after experiencing tremendous earthquakes in California. One of the most important things that has become apparent from the Virginia earthquake is the need for preparedness and ample insurance coverage.
Earthquake damage isn’t covered under most business or homeowners insurance policies. Chris Hackett, Director of Personal Lines Policies for Property Casualty Insurers Association of America, stated that most policies don’t cover damage from sinkholes or earth movement. However, fires or other incidents that are triggered by an earthquake may be covered by property insurance. He encourages policyholders to thoroughly read their policies to understand any exclusions.
Many people think they won’t experience a major earthquake during their lifetime. This is especially true for those who live in areas where earthquakes happen every 100 years or less. Although many people may not experience a strong earthquake like the recent Virginia incident, there are over 5,000 incidents recorded each year by the USGS. Damage from earthquakes has been recorded in all 50 states in history. There have been reports of damage in 39 states alone since 1900. This proves that while some people may not live in areas that commonly experience earthquakes, they’re still not immune to the threat.
Earthquake coverage can be purchased as a rider to a personal or business property insurance policy, and insurance costs vary by location, building type and the age of the building:
It’s much more expensive to insure older buildings
Brick structures are more expensive to insure
Buildings with wood frames withstand the force of earthquakes better, so it’s cheaper to insure them
Every earthquake policy also has a deductible. This means that homeowners must pay upfront for a portion of the damages before the insurer pays the remaining amount. The deductible may be up to 20% of the structure’s replacement value. The percentage depends on the insurer and the location of the structure.
Concerned about your personal insurance coverage? At Cleary, our experienced Personal Lines department will work with you to evaluate your insurance needs, identify exposures and create a customized insurance portfolio. Give us a call today at 617-723-0700 or contact us by e-mail.
Business Insurance Reviews
Why Annual Reviews Matter
Most new business owners are concerned that everything is favorable for the success and safety of their business, including obtaining the protection of business insurance. However, longevity and success can cause complacency.
Let’s say you started your business 10 years ago with just a small space and computer desk. Today, you have an office full of employees and equipment. Do you still have the same insurance policies from 10 years ago? If so, you might not realize how under-insured you’ve become.
Business owners need to ensure they’re annually reviewing their business insurance programs. Errors happen and circumstances change, even when policies were initially obtained with care and caution. Without yearly examinations, substantial expense and risk can ensue.
It’s common for small businesses to start out with basic insurances, such as commercial property and general liability policies. However, as they evolve, most find they need other types of insurance, such as:
- Excess Liability or Umbrella – covers claims exceeding your standard policy’s limits
- Workers’ Compensation – once your business reaches a certain number of employees, this type of insurance will actually be required in most states to provide payments for an employee’s lost wages and medical expenses following a workplace injury
- Professional Liability – covers your service-provided mistakes and usually your attorney fees.
- Auto, Hired & Non-owned – protects your business should an employee cause a vehicle accident in their personal or rented vehicle
- Commercial Auto – coverage not under personal auto policies, such as to your business and for employees unloading and loading
- Employment Practices Liability – coverage for HR issues, such as those related to termination, harassment, and discrimination laws
- Directors & Officers Liability – financial protection for Directors and Officers should they be sued for wrongful acts stemming from performance of their duties
- Employee Benefits Liability – covers liability issues from an omission or error in the administration of an employee’s benefits that results in the employee incurring a cost, such as a terminated employer losing benefits after not being providing with COBRA information
Depending on your business, many of these insurances may be essential to adequately protect yourself. An annual insurance review is an ideal time to discuss these insurances, as well as your need for them, with your agent. Ensure the following elements are considered as you begin the review:
- Revenue. More business is good, but it also means a greater potential for liability. Have annual sales changed?
- Property. Have you added equipment, computers, and such that would create a need to increase your commercial property policy’s limits?
- Location. Your business owner’s or general liability policy could be impacted if you’ve added, closed, or moved locations.
- Travel. A hired and non-owned auto policy may be needed if your employees are frequently driving rented vehicles.
- Employees. Have you had an increase in your workforce, turnover rate, or use of contractors? Consider
- Employment Practices Liability Insurance for high turnover rates. Workers’ Compensation insurance may be a new requirement if you’ve added to your workforce.
- Services. Are you offering additional services? For certain types of work, you may need additional endorsements to your general liability policy.
- Customers. Are you serving new clients or industries? This may cause problems with your professional liability policy if you’re servicing high concentrations of high-risk clients/industries.
The above answers will be different for every business and usually won’t remain the same over the business’s life. That’s why insurance isn’t a one-size-fits-all, unchangeable product. Take advantage of these attributes and annually review your business for exposures and insurance needs. Insurance may not cover everything, but it can certainly mitigate your risks. Start your annual business insurance review today by setting up a meeting with Cleary Insurance to discuss the above issues and how they relate to your current insurance needs.
At Cleary, we will evaluate your business exposures and work with you to develop a comprehensive plan to safeguard your business. Give us a call today at 617-723-0700 or click here to contact us by e-mail.
Wessling Architects’ Integration Philosophy
Our new client Wessling Architects uses a unique, award winning integrated approach to all their design and architecture projects. According to Stephen J. Wessling, President & CEO, this approach “enhances the design process and protects the interests of our clients not only due to the efficiency, but through comprehensive professional services, strong communication, and a deeper reliance on partnering.”