Posted by Shon Messer on Wed, Mar 14, 2012 @ 11:27 AM
Drivers should typically purchase a rental company’s loss damage waiver.
An agent asks, "I have been told by a carrier that physical damage to a rental car is excess over other collectible insurance and have found that wording in the policy. The rental agreement however, states that he is responsible for damage.”
“According to the rental company, their insurance also does not cover damage to vehicles while rented,” the agent adds. “After 30-plus years in the business and several years of teaching, this is the first I have heard of this."
In the ISO personal auto policy (PAP), not only is physical damage coverage excess over any other collectible insurance, it is also excess over any other source of recovery.
But that's just the beginning of potential problems with non-owned autos. Not only is this an issue with rental cars, but also loaner cars—those used by drivers when their car is in the shop—and even test-driving a new or used car. Members of the Big “I” Virtual University faculty address similar scenarios in another article.
One of the questions in the story involves a loaner auto, but the same issue is at risk with rental cars. The ISO PAP says it provides excess coverage over any other source of recovery. Presumably, that would include any first-party insurance or self-insurance of a rental car company.
So, if the loss is covered in full, it can be argued that the PAP physical damage coverage would not respond at all. Otherwise, it should respond to pick up a deductible—after application of a person’s own deductible, of course.
The liability coverage won’t respond because of the CCC exclusion. So, for carriers taking this position, the extension of physical damage coverage to non-owned autos would be largely illusory unless the auto is uninsured.
In that case, the PAP responds in full, less the deductible. Note this isn’t the case in states such as Texas or those with some proprietary auto policies, where physical damage to non-owned autos is still covered by the liability section, or in states with laws and policy endorsements that modify the other insurance provision in the PAP.
This is just one of the reasons—along with diminished value—why it is usually recommended to purchase the rental company’s loss damage waiver. However, that's an unlikely option with loaner cars or while test driving a car. It’s rare—if it even occurs at all—that this potential coverage gap issue or an explicit waiver of subrogation prior to loss would be discussed in a loaner or test driving situation.
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Posted by Shon Messer on Wed, Mar 14, 2012 @ 11:23 AM
'The severity of the losses is very high,' one carrier says, noting hail claims are likely to follow.
In the aftermath of last week’s devastating tornadoes, independent agents and carriers are working to handle volumes of claims for those affected by the storms in the Midwest and South.
Two forceful storm systems swept through the regions, spawning a series of twisters that destroyed communities and left dozens reported dead. Some of the hardest-hit states include Illinois, Indiana and Kentucky.  While the amount of insured damage from the storms on Feb. 28 to 29 and March 2 to 3 is still being tallied, catastrophe modeler EQECAT pegged its initial estimate of insured losses at $1 billion to $2 billion.
Already, 2012 has an above-average start for catastrophes. The number of tornadoes so far this year—272—is more than twice the seven-year average of 123 for the same time period, according to EQECAT.
They follow a trend of significant disasters in recent years and come on the heels of a costly year for tornadoes in particular. In 2011, insured losses from tornadoes and thunderstorms totaled more than $25 billion, which is more than twice the amount of the previous record, according to the Insurance Information Institute.
To date, Ohio-based carrier Westfield Insurance has received about 450 claims related to last week’s storms, says Corry Novosel, director of the company’s catastrophe claims operations.
“The severity of the losses is very high,” says Novosel, whose company offers business and personal insurance in several of the affected states. “That’s very common with tornado damage.”
The storms also carried significant hail, which is also causing a lot of claims, Novosel says. In areas such as Kentucky, there have been reports of baseball-sized hail, which can cause serious damage to roofs, porches, windows and siding because of its mass.
Roughly 70% of Westfield’s claims are filed through agents, with the remainder submitted directly by policyholders, Novosel says.
“You can imagine when a tornado or hail hits [for example in] Louisville, those agents there are going to be extremely busy for a week or two because their phones are going to be ringing off the hook with people wanting to report their claims,” he says.
While there’s an immediate influx of severe claims from tornado losses, hail-related claims tend to trickle in for months—even up to a year—after a storm, he notes.
Often, damage from hail is more cosmetic and may be noticed later. That’s been especially true in recent years, when roofing companies have offered free inspections for homeowners near areas affected by tornadoes, with the hope of generating new repair business if they discover any hail damage, Novosel says.
Meanwhile, in responding to catastrophic claims, Novosel says his company prioritizes open communication with agents to keep them updated.
“We need to make sure that they can get those claims to us,” he adds.
Westfield’s communications team uses different ways to regularly stay in touch with agents—from updating the company’s website to sending out emails—on information such as how many adjustors will be in the field, where they’ll be based and the best way to contact company representatives, he says.
Within 48 hours of a catastrophe, the company typically deploys its own adjustors to affected areas and encourages field staff to visit agencies to let them know they’re there and work as closely with them as preferred by agents, Novosel says. For last week’s storms, Westfield has teams in Cincinnati, Louisville, Ky., and Nashville, Tenn.
The amount of time adjustors stay in the field can range from three to six weeks, depending on the number of claims submitted. The company strives to resolve storm claims within 30 to 60 days of being filed, he adds.
“You want to show up and be there for your policyholders and make your agents in that area look good, and be the guys that responded when tragedy struck,” he says.
Members can use Trusted Choice® consumer guidelines on preparing for and responding to a tornado.
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Posted by Shon Messer on Thu, Feb 02, 2012 @ 08:54 AM
It is a sad, simple fact that renters insurance can lessen the pain of mishaps and disasters for renters. Think of it, you come home and your entire apartment is flooded. You call the landlord to fix the leaky pipe and then you are left with wet rugs, buckling floors, dirty couches, floating laundry, etc. The landlord fixes the pipe, cleans the rugs and tells you that you are responsible for your possessions. You threaten to sue him and he tells you to read your contract. Even worse, your apartment burns to the ground. Sadly, he is right. He needs to maintain and restore the building; you are responsible for your contents. More and more landlords are requiring renter’s insurance at the signing of a lease. Better to sort out responsibilities before disaster happens with a comprehensive renters insurance policy.
In a perfect world, all of your possessions would be photographed and cataloged. Your records would be in your safe deposit box. Your inventory would include date of purchase, serial numbers and other pertinent information about the significant items in your home. Be prepared for the unknown and that is fairly easy because renters’ insurance is a great value and relatively inexpensive. There are two types of coverage: Actual cash value, which is the replacement cost of an item minus depreciation. Replacement coverage allows you to buy new items and to replace items lost, stolen or damaged, no matter how old they are. Replacement is more expensive because of course, you will get more back.
There is generally a deductible, the higher the deductible, the less you pay. If you live with roommates, they should probably all be on the policy. If you have a dog, your policy maybe higher, depending on the breed it could be even higher. You probably should have the same liability limits on your renters insurance policy as you do on your auto insurance policy. Like your auto policy, you want to make sure your renters insurance will cover all your assets if you are sued.
Renter’s insurance may also cover your possessions when you are away from home. Most renters’ policies cover additional living expenses if you are unable to live in your house because it is temporarily uninhabitable. That is usually a reasonable amount of time and like homeowner’s policies, floods, landslides and earthquakes are probably not covered. Renters insurance is probably something your mother would tell you to have and she wouldn’t be wrong. Without it, you could be wet, displaced or out all of your possessions and even worse. Give your agent a call and find out why renter’s insurance should be part of your entire protection policy. by Shon Messer
Posted by Shon Messer on Sun, Jan 15, 2012 @ 02:51 PM
The number of tragic examples concerning distracted driving are on the rise. A train collision in which the engineer was texting killed 25 people in Chatsworth, Calif. A fatal tugboat accident occurred near Philadelphia while the pilot was texting.
Closer to home, an 18-year-old woman and her 10-month-old son were killed in a car crash on Interstate 65 in Chilton County in August; police said she was texting and lost control of her vehicle.
Distracted driving and, more specifically, texting while driving is dangerous. There is no way to type a text, or read one, without the driver taking her eyes off the road.
The tragedies we read in newspapers or see on the evening news are enough to convince Alabama lawmakers to follow state Rep. Jim McClendon's lead and ban texting while driving in Alabama. McClendon, a Springville Republican, has filed a bill for the legislative session that starts February 7th.
This isn't a new concept, with 35 states, the District of Columbia and the U.S. territory of Guam already banning text messaging for all drivers. Meanwhile, the Federal Motor Carrier Safety Administration has banned text messaging for anyone while driving a commercial truck or bus for interstate commerce.
This is at least McClendon's fourth try at a texting ban for the state. He first introduced the bill in 2009. McClendon has found success in the House, but the bill always died in the Senate.
This session, state Sen. Jabo Waggoner, R-Vestavia Hills, is sponsoring a Senate version of McClendon's bill and Waggoner has made it a priority. Waggoner chairs the Senate Rules Committee, which sets the daily agenda. That should give the texting ban a real chance at passing.
It's worth noting that although making texting while driving illegal has failed statewide, a number of Alabama cities ban the practice. Few citations have been written for texting while driving; it's difficult for police officers to know for sure whether somebody is texting or dialing a phone number. But if there is a law, many people will think twice before texting and driving because of the possibility of a citation.
McClendon's bill would fine drivers $25 for the first violation, $50 for the second violation and $75 for the third violation. The bill also would make texting while driving a primary offense, meaning police could stop somebody for that violation only, like the state's mandatory seat-belt law.
Texting while driving is among the most dangerous distracted driving behaviors. Study after study has shown texters are much more likely to crash than people who aren't texting.
Posted by Shon Messer on Fri, Dec 23, 2011 @ 09:51 AM
We admit it: As insurance pros, our picture of winter isn’t exactly cozy. Winter storms mean traffic snarls, hillsides turning to sheets of ice, and cars sliding around like hockey pucks. Cold temperatures can cause pipes to burst, frost swells and other damage. Heating your home with fireplaces and holiday lighting can increase the risk of fire.
A picture-perfect winter requires a few precautions
Here are a few of our top tips to help reduce weather-related hassles this winter.
Winter-proof your car with good snow tires or chains, new wiper blades, antifreeze, and emergency road supplies.
Keep your attic cool to help prevent ice dams. Insulate the attic floor and make sure it is well-ventilated.
Do not overload circuits with holiday decorations.
When winter storms hit, be smart
If you do not have to drive, stay put. If you must drive, make sure you’ve winterized your car and have a full tank of gas.
When the air is cold, keep bath and kitchen cabinet doors open so warm air can circulate around pipes. If pipes do freeze, let them thaw normally—they’ll be less likely to burst.
And if the power is out, make sure you avoid leaving candles or fires burning unattended. If you use a portable generator, follow the instructions and do not use it indoors.
Know what your insurance covers
We want to help you rest easy. You will be more relaxed when you know you have prepared your property to lessen the chance of winter storm damage. Your insurance policy covers repair or rebuilding costs. However, your deductible does apply. Check your policy to see what is covered and to confirm the deductible you have chosen.
If you have any questions at all about your coverage, call Shubert Insurance at 205 640 5892 and we will help you review your options.
Posted by Shon Messer on Thu, Dec 22, 2011 @ 03:31 PM
As the owner of a small business you understand better than anyone the meaning of “risk.” The key is to know understand how much risk you can afford, and when or where is the right place to take risk.
Insurance can be a risk-taker’s best friend. It allows you to use your entrepreneur’s judgment to decide which business risks are worthy and which are not by using your properly designed insurance program as your safety net when things go wrong.
Insurance can handle those unexpected risks that come as “Acts of God” (weather, sickness or other types of claims that are often beyond your control), as well as those risks, which, unfortunately, have become all too expected, such as liability or workers compensation claims against your business.
Although many types of insurance policies and packages available to small businesses today are so extensive that it may seem you can cover just about anything that can go wrong, the most sensible long-term approach is to leverage your premium dollars by focusing coverages in areas most likely to cause your business the most pain. Even though such a focus may seem obvious, it often gets overlooked or ignored by business owners who are mainly looking to insurance to meet requirements set upon them by others— such as banks, lienholders, landlords or government regulators. While these are important considerations, and cannot be ignored, don’t let the “gottas” become your entire insurance program.
After all, it’s YOU taking the risks to bolster your business, not the landlord or the government. You have no choice about meeting such requirements, but consider further options you may need regardless of the demands of others.
Here are just a few examples. If your business is your family’s sole or main source of income, it makes more sense to spend some premium dollars on a life insurance policy that guarantees to provide that income if events conspire to take you out of the picture (euphemism for you’re dead).
In the same manner, if your business survival—at least in the short term—is dependent upon the work of a key employee, then it would be well worth your time to: (1) explore buying a life (or disability) insurance policy for your business on that key person, (2) provide a financial buffer in the event of that person’s death until you can find another equally talented individual, or (3) reorganize your business.
Do you need special computer coverages for all of the technology your business may be so dependent upon? While standard property insurance forms may provide basic coverage by treating these items like any other part of the building or contents, there are many issues unique to high tech equipment that only a specialized form will address. Such issues include: computer viruses; equipment valuations at time of loss (since computers, like new cars, lose a lot of their value within six months of purchase); business income losses due to being down for an extended period of time; electronic forgeries and theft; liability arising from alleged breaches of customer privacy; and many others.
Although your building may be covered for the amount required by the mortgage holder or even what you paid for it, what would it really cost to rebuild it from the ground up following a major loss? Are there special design issues that may raise the building costs? Are there any building ordinances (such as requiring all new buildings of your type to have sprinkler systems) that will significantly increase your rebuilding estimates? If your building was “grandfathered” under your community’s current building restrictions, will you even be allowed to rebuild at your current location? (Have you checked your zoning ordinances lately?)
If your business is unable to operate due to extensive damages, what amount of income will you lose during the time it takes to make sufficient repairs to open the doors again? Or would your choice be to reopen as quickly as possible at another location? The “hurry up” expense of making the move, installing the necessary equipment and notifying your current clients may prove a significant burden.
Are the liability limits required by your landlord or automatically included with your business’ insurance package high enough? Consider this: how often do you read about some new wave of multi-million dollar lawsuits against businesses—big and small—in your newspaper.
All of these are reasons why there is no substitute for sitting down with Shon at Shubert Insurance and spending some quality time going over what are the key risks your particular business faces and what are the possible solutions. Don’t risk it all by living by that old cliché; insurance is one time it always pays to “cross that bridge before you come to it.”
Posted by Shon Messer on Sun, Dec 11, 2011 @ 05:15 PM
Whether you employ only one part-time worker or thousands of employees in multiple locations, workers' compensation insurance can be a significant cost of doing business. Comprehensive education and ongoing training in the workplace will help you reduce worker's compensation costs.
Workers' compensation insurance premiums are calculated based upon a combination of factors including size of a company's payroll and claims history compared with other businesses in your industry. This means companies can do a great deal to impact their premium costs, reduce worker claims by creating a work environment oriented toward worker safety and training.
There is a great deal of information available to employers about how to improve on the job safety and training, primarily through your worker's composition carrier. Many insurance companies provide trained industrial hygiene specialists who will consult with you for little or no cost to evaluate your current safety and training programs.
Improving Your Current Worker Safety Programs
Loss prevention begins with an audit of your company's current safety programs. Study how employees are performing their jobs, how job processes can be improved to reduce and eliminate injuries. Review your industrial accident record. Is there any correlation between frequency of accidents and job process? You may want to consider the following steps to improve your company's programs.
1. Documentation
Worker safety programs should begin with documented written programs including job descriptions, proper use of equipment and safety procedures in the event of an industrial accident.
2. Training
All new employees should be thoroughly trained on their job duties and safe handling requirements. Existing employees should receive regular and updated training on proper use of equipment and job procedures.
3. Regular Updates and Supplemental Materials
Many workers' compensation carriers as well as industry associations and state regulators offer published information, videos and newsletters which can be distributed to employees to increase job safety awareness, enhance training and reduce on the job injuries.
4. Worker Safety Committees
Develop a committee or group comprised of internal staff from a variety of functional areas to evaluate and suggest improvements in your company's accident prevention programs. The charter of this organization should focus on process, education, and ongoing training.
5. Early Return to Work Programs
Encouraging early return to work by previously injured employees can help reduce the costs of workers' compensation claims in a number of ways. Historically, workers' compensation claims can be reduced if employees can be retrained for a new position because they possess valuable experience or historical information about the company. They can learn their new role more quickly make an immediate contribution. Job retraining is a proactive approach that improves employee morale significantly. Safety and education can result in substantial reductions in industrial accidents and worker's compensation claims. The first step is creating greater awareness about job hazards and safety processes among your personnel.
Posted by Shon Messer on Thu, Nov 10, 2011 @ 06:29 PM
Get answers to some of our most commonly asked questions here. Each section is grouped by insurance type.
Posted by Shon Messer on Tue, Nov 08, 2011 @ 12:07 PM
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As Thanksgiving approaches, many people will celebrate the holiday bygiving back to their community. Volunteering time or services to a company or non-profit organization may be a selfless act of generosity, but these acts of goodwill can also expose volunteers to possible lawsuits if they are making decisions on behalf of the organizations or company. Fortunately, there is a way to mitigate the exposure to lawsuits and continue lending a hand.
A directors and officers (D&O) insurance policy protects directors and officers from liability risks associated with working or volunteering on the board of an organization or company. These risks can include negligent acts or omissions, antitrust violations, wrongful termination, libel and slander, and misleading statements that result in a lawsuit against the company. Whether you're working or volunteering as a director or officer, it's important to make sure you're protected from these risks with a D&O policy.
Directors and officers can be sued by the company or organization they work or volunteer for or by other current or former directors and officers, employees, shareholders, investors, lenders, vendors, customers, competitors, various government officials, such as state attorney generals, the IRS and state and federal labor departments, consumer groups and numerous other third parties. While the entities that can sue a board member are numerous, the situations in which lawsuits can be filed are limitless. Here are just a few examples of real D&O claims from the Big "I" Virtual University:
* A minority shareholder in a family-owned electrical contracting business sued the two major shareholders on behalf of the company, claiming they breached their fiduciary duties. The minority shareholder claimed that the majority shareholders, by drawing excessively large salaries and bonuses, caused the company to lose money. The court ruled in favor of the majority shareholders, but the defense costs amounted to six figures.
* A mid-sized manufacturing firm hired an employee away from one of its competitors, bringing the person on as an officer. A year later, that new officer's ex-employer sued the officer and his new firm, alleging that the officer misappropriated trade secrets and violated certain provisions of is termination agreement.
*The plaintiff filed a complaint against their competitor alleging that a former employee, now working at the competition, engaged in unauthorized use of confidential and proprietary informationcommitted other acts of unfair competition. As a result, the plaintiff alleged it has suffered irreparable and immediate injury. In addition, the plaintiff alleged that the defendant has possession of its confidential information and intellectual property.
There are several types of D&O insurance that can protect individuals from these situations. These coverages include corporate reimbursement coverage, which protects directors and officers of a company or organization; side-A coverage for directors and officers who are not indemnified by a firm; and entity coverage for protection against claims made against a company. D&O policies can also be written to include coverage for employment practices liability for protection against lawsuits for wrongfully terminating an employee or sexual harassment.
Before you start working or volunteering in a director or officer capacity, you should check with the company or organization to make sure it has a D&O insurance policy in place. If you're serving on a board and you're unsure about whether you're protected, give us a call at 205 640 5892 and we can answer any questions you have about coverage and risk exposure
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Posted by Shon Messer on Mon, Oct 24, 2011 @ 09:56 AM
Halloween is just around the corner and many consumers may not realize how scary this ghoulish night might really be for their personal safety, their property…or their pocketbooks. Trusted Choice® independent insurance agents can help families better prepare for Halloween hazards that may come in disguise or under the cloak of dark.
To help families and businesses have a good time and protect themselves against more scary Halloween risks, Trusted Choice® offers the following safety tips:
• Prevent Accidents: Remove or move lawn furniture, or any other obstacles, to avoid accidents or damage. Ensure your home's entry is in good condition, free of loose or broken pieces on stairwells and walkways to avoid trick-or-treaters' injuries on your property.
• Fire Dangers: Prevent fires by making sure pumpkins containing candles are placed at a distance where a child's costume cannot be ignited or a curious guest may tip it over. Extinguish all candles before going to bed and use battery operated lights wherever possible.
• Costume Safety: Be careful with costumes. All disguises should be made from flame-resistant materials and shouldn't be too long or contain sharp accessories. Try to avoid masks that may obscure vision and try to use hypo-allergenic make-up instead.
• See and Be Seen: Encourage each trick-or-treater and adult chaperones to carry a flashlight. Apply light-reflecting material to costumes.
• Don't be a Scary Driver: Drive sober, slowly and even more carefully than usual on Halloween. Watch for children who may be running or wearing dark costumes in the road.
• Power in Numbers: When walking, travel in groups and cross only at corners and crosswalks—never between parked cars—and stay on well-lit streets.
• Unwelcomed Guests: Scare away potential property vandals who often use the chaos of Halloween night to strike by keeping outdoor lights on.
• Pet Safety: Keep pets inside. Warn your children to stay away from animals as they go door-to-door. Halloween night can be stressful, even on the friendliest dog or cat or other creatures.
• Candy Inspection: Cavities aren't the only candy-related risks on Halloween. Inspect all children's treats. Never eat unwrapped items, collect candy only from those you know and ask the local police department if it offers a candy x-ray and/or inspection service. Throw away any suspicious candy.
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