Business Protection Bulletin

Being an auto mechanic can be tense. If someone brings a toaster in for repairs, you might be out the twenty bucks it costs to replace it. If you make a serious mistake while repairing a car, you’re looking at a slightly bigger insurance claim. People trust you with one of the most important things they own, it’s what they use to get to work, it’s how they pick up their kids, it’s what they ride in to take a vacation. Serious mistakes are relatively few when you’re a professional mechanic, but they can happen. Add to this the fact that you have a team of people working in a noisy, dangerous environment, and it’s no wonder most mechanics insurance packages are pretty robust.

In short, here’s what needs covered:

• Garage Liability

If you’re running a place of business, then some sort of liability policy is par for course. In a garage, your garage liability coverage will provide protection beyond what commercial property liability can offer. A standard commercial liability policy might come with a lot of catches given the nature of the heavy machinery and dangerous work involved in running a garage.

• Equipment Breakdown Coverage

Also known as “boiler and machinery” coverage, this type of insurance covers you for everything from burnout and operator error to power surges and mechanical breakdown. We sometimes forget that heavy machinery can actually be quite delicate against certain damages.

• Garage Keepers Coverage

This is the one that’s going to protect you from a lot of potential lawsuits. Garage keepers coverage is there to ensure that you have a backup plan should something happen to a customer’s vehicle. This is another enhancement to commercial liability. In an office setting, a visitor might pinch their finger in a copy machine. In a garage setting, a malfunctioning ramp could lead to serious axle damage that you don’t want to cover out of pocket.

This is all in addition to the coverage that you would have in any workplace, of course. You need to be protected from things like theft and fire, you need coverage to provide for workers compensation and so on. The above-listed auto mechanics insurance policies simply mean that, even in a workplace as potentially volatile as an auto garage, you, your customers, and your employees will be covered just in case something goes wrong that couldn’t go wrong in an office or a grocery store.

If you want to talk about a big insurance policy, let’s talk about contingent cargo insurance. Freight insurance covers product of an enormous value, and there’s a lot that can go wrong at sea. A car accident that you can walk away from is not likely to cost your insurer more than five figures. A serious problem on the open waters can lead to millions of dollars in losses. A freighter is basically a small town with an engine on it, so you need a heavy-duty policy to cover every trip.

A contingent cargo policy is taken out by freight brokers in order to insure against any claims made by the shipper. Shippers are expected to hold the brokers accountable should there be any significant losses or damages in transit, and will only come into play should the carrier refuse to honor a claim. For instance, if the captain throws a cargo container into the sea in order to, say, pick up speed in order to escape approaching pirates, the carrier is unlikely to honor the claim made by the shipper. In this instance, contingent insurance would then pay the claimant.

Contingent motor cargo insurance isn’t exclusive to maritime transport, of course. Anyone who carries cargo may carry contingent cargo insurance. This means trucking companies, airplanes, trains, even somebody who’s pulling a big enough trailer with their car may carry a contingent cargo policy. Essentially, if you’re carrying more cargo than you cover out of pocket, then a contingency cargo policy may help to keep you in business no matter what goes wrong.

Contingent cargo coverage, of course, only covers the cargo. This type of policy will help to ensure that, should something happen to the cargo, the shipper will be reimbursed without the carrier needing to pay out-of-pocket for damages or losses due to a train accident, a ship sinking or similar disaster. The carrier, driver, captain, train conductor, the company that owns the truck or railroad or ship will still need to cover their own end on every front required within their industry. Contingent cargo plans won’t cover, say, a ship worker whose leg is injured on the trip and is entitled to worker’s compensation. Contingent cargo insurance means that, if none of the other policies that you have in place will cover your cargo losses or damages, then you still have a last line of defense to fall back on.

In some ways, logging insurance is like any other field of insurance for a blue collar workplace. Your big concerns are things like workers comp, general liability, contracting issues and so on. If you work in logging, you’ll encounter a number of factors and complications that you might not have to face erecting one story homes and remodeling office buildings, but generally speaking, if you’re familiar with something like construction insurance, then you’ll have an easy enough time adapting to timber logging insurance.

The key difference is owed to the environment in which your people will be working. A construction site is a relatively controlled environment. The forest brings with it a number of hazards that are trickier to manage and prepare for. Likewise, this environment brings us to the matter of transporting equipment and materials in and out of and through the forest. A construction site is stationary. Once you move your equipment in, most of it is where it’s going to be until the project is finished. A logging team is eventually going to run out of lumber in one area, and they’re going to move on to the next.

Many of the policies and provisions that a logger will buy are the same that a construction company would purchase, but they may be more extensive for the logger, for instance:

• Pollution. The logging industry is often targeted by environmentalist groups, meaning that without adequate pollution insurance, you’re asking for a scandal.
• Loading and unloading liability. Your crew is migratory, they’re going to be doing a lot of loading and unloading, meaning that the chances of dropping a toolbox on your foot is multiplied at every stop.
• Power line damage. Put simply: You’re knocking big trees over. It’s not unheard of for one of them to fall right onto a power line.
• Fire damage. Your team is creating just as much kindling as they are lumber.
• Accidental overcut. It happens: Your crew gets a couple of maps mixed up and they wind up chopping wood on someone else’s tract. Accidental overcut insurance protects you from any losses you’d incur over this.

Some mills offer rewards to logging companies that come with a robust logging contractors liability policy and a top-tier workforce simply because it’s safer for everyone involved in the deal when all bases are covered. Logging can be a very rewarding industry, but mistakes can be very expensive without the right coverage.

Here’s the dangerous thing about snow plowing: By nature of your job, you’re on a slippery, frozen road that you can’t even see. So it’s hardly a stretch to say that, as important as auto insurance is in general, snow plowing liability is doubly important. If you run a team of drivers, then it’s only a matter of time before someone chips some private or public property or does some damage to the plow. Here’s what you need to consider when considering your snow plow insurance:

The Scale Of Your Company

When insuring your vehicles and drivers, you need to consider to what extent you can afford to pay for damages out of pocket. For some companies, it’s not a big deal to manage their own repairs for all but the worst accidents. Others need a more comprehensive plan. Obviously you’re not going to be driving without any coverage at all, but how much do you need based on what you can afford to cover yourself?

Not Every Accident Is A Collision

A lot can go wrong when your job involves dealing with harsh weather. A driver is as liable to suffer an injury while strapping the chains onto the tires as they are to slide into another truck while driving. The risks that you and your drivers take are not isolated exclusively to collisions, and your policy needs to reflect that.

Training

Training for a snow plow driver is a little more intensive than training for a pizza delivery guy. You’re looking for safe drivers with clean records (this is very important when getting them covered under your commercial auto policy) who are fast learners, because, after all, Winter doesn’t last forever. In most states, you don’t need a special license to operate a snow plow, but you will need a permit in order to operate a commercial snow plow business. Luckily that’s something that you can take care of on your end, you won’t need your drivers to worry about it. You have to expect at least a minor accident now and then with such a tough job, but good, safe drivers can mean the difference between a minor accident and a major one, and they can help keep your insurance rates nice and low.

You don’t want to be the person who says “What’s the worst that could happen? It’s just little league!” Whether you’re running a youth soccer team, an amateur baseball club or a professional rugby team, your athletes are taking the game very seriously, and when people are taking the game very seriously, they push themselves and one another to do their very best. In other words, you don’t need to get drafted in the NFL to sustain an injury in the line of duty. Sports team insurance not only protects you from liability, it protects your players and the venue owners. In short: As soon as you’re moving the game out of the backyard or the public park, then it’s time to look into football team insurance.

Bodily injury and property damage are the main concerns in youth sports insurance, or any athletic insurance, really. Now and then, a ball is going to crash through a window, a quarterback is going to twist an ankle. We do everything we can to reduce injury and property damage in sports. We encourage stretching and warm up and safe play, but sports are physically demanding and unpredictable. That’s a big part of the fun, and a big factor in liability.

The most likely injuries to take place will be to the athletes, and the most likely damages will be to surrounding property. However, there are a lot of “civilians” involved in the game indirectly, from spectators to volunteers and vendors. A tackle that flies right through the sideline and knocks a food vendor over, a football that catches a spectator on the nose, sports wouldn’t be exciting if it weren’t for the fact that “anything can happen,” but they wouldn’t require comprehensive liability coverage, either.

cover all of your bases.

“Real estate owned” can be a misleading term for people who are new to the deal. Isn’t all real estate owned by somebody? The difference between owned real estate and real estate owned, or REO, is that the latter refers to real estate that is owned by the lender. This could mean real estate that’s owned by a bank, a loan insurer, a private lender or a government agency. In other words, REO is usually invoked as a three letter word for “repossessed.”

REO property is usually the result of a foreclosure, and will typically be the result of a home with a lower market value than the amount owed on the home. We saw a lot of these in the real estate crash in the 00’s, with many homes becoming REO properties following an epidemic of bad loans. It’s also common to see many REO properties hitting the market following a real estate bubble.

So, from the sound of it, it seems like REO is a bit of a burden to bear, right? If you own an REO property, then that means that your borrower isn’t paying you back, and the home is worth less than you put down to cover it in the first place. REO insurance can, at the very least, help to ensure that the investment isn’t a total loss.

Step 1: Determine the Equity on the Property

Once the property goes into a distressed status, such as the borrower missing mortgage payments, the lender will need to determine the equity on the home. You can do this with a BPO, or Broker’s Price Opinion, or you can order an appraisal. From here, the borrower may request a short sale, or the foreclosure process will begin.

Step 2: Foreclosure Auction

If you can sell a home through a foreclosure option, then it never becomes an REO property, and will still be covered by homeowner’s insurance.

Step 3: Comparing Quotes and Buying Coverage

From here on, buying foreclosure insurance is just like buying any sort of property insurance. You compare quotes from lender placed property insurance providers, select the package that best suits you, and you’re set.

Running a rental business brings its own unique risks and challenges. You’re not just responsible for your property, your apartment and condominium complexes, you’re also responsible for the people who live in them. Habitational insurance combines elements of home insurance, business insurance with all manner of liability concerns.

Anyone who runs a business in a building where customers and clients can come to visit in the flesh knows that they’re going to need liability should anything happen to their visitors. With habitational insurance, even more so than hotels and other homes-away-from-home, you’re looking at more long-term risks. Brief exposure to toxic mold,  for instance, isn’t so dangerous, but leave a moldy spot in a tenant’s bathroom for too long and you could be looking at some major health expenses.

A question worth asking: Who needs habitational insurance?

The answer is: Just about anybody who owns a rental property. Of course, the more tenants you’re servicing, the more important habitational coverage will be, but even if you’re just renting out a single house to a small family, habitational insurance will cover you for risks that are not covered by basic homeowner insurance. A solid habitational policy can also cover risks that you’d be more willing to pay for out-of-pocket for your own home. Vandalism, for instance, may be considerably more expensive to clean up and paint over when you are running an apartment building than when you only have one house to worry about. You can take a bucket of paint and get rid of the graffiti on your own garage door with about a half hour’s worth of work. A group of teenagers breaking all the light fixtures in an apartment building, on the other hand, will be a little more expensive.

There are also risks that don’t exist at all for homeowners. Loss of rental income, damage to outdoor signs, accounts receivable losses, insurance to cover your association directors and officers in a condominium community and so on.

Habitational policies are there to keep you covered when you need business insurance, and your business is in homes. You are responsible not only for the building where you rent units out to tenants, you are also responsible for tenants and their visitors, as well as any employees you may have helping you maintain your business. If you’re renting out so much as a single room to a single tenant, it’s not a bad idea to look into a habitational policy.

If you’re a part time passenger transportation professional, whether that means driving a taxi on weekend or picking up an Uber passenger when you’re already going in that direction, you probably don’t want to be driving any customers anywhere without getting covered under some form of taxi cab insurance provision.

Okay, maybe you can take that hitch hiker up on his offer to pitch in for gas and not have to worry about it. The chances of something happening that will lead to you being held liable in a professional capacity in that instance are relatively slim. But if you’re driving passengers around on even a semi-regular basis, you’re increasing your risk of paying extensive costs out of pocket with every new customer you pick up. Here’s what you’ll want to do to make sure that your bases are covered:

Make Sure Your Insurer Knows What You’re Up To

Here’s the good news for Uber drivers: For anything that happens while the app is on, Uber provides supplemental insurance. Lyft offers similar coverage for all of their drivers. If you’re driving a taxi, different states legislate the industry in different ways. In some states, you’re not allowed to work as a private taxi driver at all, in others, you might not even need a specialty license to do some part time cab work. The taxi driver insurance requirements from state to state are just as varied. For instance, if you have a history with drug or alcohol problems, if you’ve ever been convicted on weapons or ATF charges, you might not be allowed to buy taxi insurance in the first place. Uber driver insurance requirements are more lenient in some ways, but Uber won’t hire people with certain convictions on their record.

Keep Your Own Tabs

You get mixed up with all sorts of people when driving for a service like Lyft or Uber. Keeping your own personal records can help keep you out of hot water in the future. There are all sorts of recording apps out there that can be used for security against would-be thieves, and even to prove your own innocence should you be implicated in a crime. A Muslim cab driver accused of a knifepoint assault in the UK back in 2013 exonerated himself with a voice recording app that he had been using for security purposes. Your employer’s first concern is protecting their own business. Your own safety is, to some extent, in your own hands.

Hopefully we’re not painting too grim a picture of driving for a living here. The instances where things go wrong are far outnumbered by the instances where things go right, but that’s what insurance is for, isn’t it? To protect you when things do go wrong, no matter how common or uncommon those instances may be.

Kitchen fires, food poisoning, liability, spoilage. People who run sit-down restaurants have it easy. The real nitty gritty insurance risks come when you start delivering food to people’s homes. It’s like the wild west out there, anything can happen.

You’re ready to look into franchise delivery restaurant insurance as soon as you start running a business that delivers. If there’s one exception, it may be when you’re the only person doing the delivering, and you don’t mind paying any unforeseen expenses out of pocket. If you have people delivering for you, then you’re responsible for the restaurant, for the food, for the customer, for the driver, and, to an extent, for their car. Their personal insurance might help to cover a lot of what might happen out on the road, but whatever your drivers do on company time may wind up costing company dime.

In some instances, your driver might be totally covered under their own policy, for their own expenses, that is. Their insurer isn’t likely to be the one paying out if they are robbed while delivering for you, and their policy might protect them, but it might not protect you if they are found at fault in an accident that occurred while they were on the job. Furthermore, some insurance providers won’t cover delivery drivers in the first place, forcing these drivers to seek specialty insurance or, in some cases, drive a company car under their employer’s policy. Many insurers cite the high mileage that comes with the job. All those little ten minute trips to and from the customers’ homes may not seem like much throughout the day, but by the end of the month, a pizza deliverer has racked up more miles on their car than some of us drive in a year.

If your employees are driving company cars, then you’re going to be looking into commercial auto insurance. If your drivers are using their own personal vehicles, then you’ll need to make sure that they have full coverage for themselves, including some form of pizza delivery insurance to cover their own end should something happen to them on the job. You will also need to ensure that your insurer knows that you’re employing delivery drivers, and talk to them about what sort of coverage they can offer you, from data compromise insurance to employment practices liability to food contamination and, if you serve alcohol, liquor liability, as well.

Railroad insurance. Now there’s something that most people don’t think about very often. To the average American, the railroad is something from the old west. Of course the truth is that after a couple hundred years, we still haven’t figured out a better way to get a whole bunch of stuff across the country quickly than the railroad. Trains and tracks are as relevant in 2016 as they were in 1916, still the backbone of the North American economies, and still the most beautiful way to see the country.

With advances in technology, trains are safer than ever, but, the risks have, if anything, become greater. If a truck turns over on the highway, you lose a truckload of product. In a train accident, you may lose several miles worth of product and millions of dollars in equipment. In other words, while a major railroad crisis is less common now than it was a hundred years ago, it’s still going to be too expensive for anyone but King Midas to pay for out of pocket. There aren’t a lot of minor disasters in the railroad business, and there aren’t a lot of inexpensive ones, either.

Although the public generally doesn’t spend a lot of time thinking about the train industry when everything goes right, it seems like they can’t think about anything else when something goes wrong. A disaster resulting from a defective part will have people on Facebook and Twitter speculating and debating as to who’s really to blame on this one and proudly declaring that this is why they choose to drive everywhere. It’s for this reason that you won’t meet a lot of railroad professionals who don’t have a crisis management expense reimbursement provision in their policy along with railroad protective liability and rail servicing liability. When you have a fender bender in your private vehicle, nobody needs to know about it but you, the other driver, and your insurance companies. When something goes wrong on the track, a lot of time, effort and money goes into protecting your reputation in the public eye.

While people tend to think of the railroad industry as something of a relic, the truth is that few professionals put as much time and effort into pushing their technological boundaries as those who run trains for a living. With the tremendous risks and liabilities that come with railroads, the ceaseless push for safer, smarter ways of transporting cargo is absolutely vital.