Singing in the Rain

umbrella liabilityI love that scene from the 1952 classic “Singing in the Rain” where Gene Kelly belts out the title song while twirling an umbrella, splashing through puddles and getting soaked to the skin. I recently discovered that he was actually ill during the filming of that sequence – with a fever of 103! You know what they say… “The show must go on!”

The same is true for your business. Unfortunate circumstances come into our lives, and we must deal with them. Life doesn’t stop just because it would be convenient for us, does it? Enter the Umbrella policy.

What do umbrella policies do?

Insurance professionals can’t help themselves. We rely on wonk-ish diatribes to describe umbrella policies because they are technical in nature.

So let’s try to simplify.

Most companies buy insurance because they are required by law. Workers’ compensation and automobile liability allow companies to hire employees and use public highways. If they own property, their lender requires insurance. If the company leases space, the landlord requires premises liability.

But the real reason to buy insurance: trade a known loss (premiums) for unknown losses (claims). Your company can budget for the acceptable level of known loss which protects against normal, everyday losses associated with entrepreneurship.

With an umbrella policy, you’re buying catastrophic loss coverage for imaginable claims. Imagine the multi-passenger near fatal car wreck or the nightmare products liability claim that costs millions in damages.

You’re also buying coverage for unimaginable claims. Claims not covered by your automobile, general or employer’s liability:

  • Do you promote your company through social media? Libel and slander losses are covered by personal injury liability, usually excluded in general liability policies, usually covered on umbrellas.
  • Do you send employees out of the country? The stated territories for coverage under standard general and automobile insurance is the United States and Canada. For umbrellas, it’s worldwide. Now, some umbrellas specifically expand territory language to include “anywhere” because of commercial space travel.
  • Any possible sexual harassment in your organization? Again, usually excluded by general liability, but included under umbrella coverage.

These examples of rare occurrences give a taste of the importance of umbrella liability. Your company can be blindsided by large liability claims that are not anticipated by your typical liability coverage. Broaden the territory, widen the safety net, spend a little more premium, get more peace of mind.

Trade a little more known loss, your umbrella premium, for a lot of protection against the unimaginable loss. Then you too will be able to sing in the rain.

Data Breach – You’ve Been Hacked. Now What?

No matter how prepared you are – or you THINK you are – you can still suffer a cyber-security  data breach. According to a recent report released by the Online Trust Alliance, over 740 million records were exposed in 2013 alone, making it the worst year for data breaches to date. What you do next can have a profound impact on the reputation of the business, customer loyalty, employee morale, and, ultimately, your bottom line.

An effective communication strategy should follow these guidelines:

  1. data breachNotify key regulatory and legal authorities as soon as possible, unless this might impede a criminal investigation. Even if notification isn’t required by law, it’s an important courtesy.
  2. Make sure that staff roles and responsibilities for communicating the data breach are outlined and understood clearly.
  3. Tailor the notification process to the audience – high-value customers, senior employees, or individuals who might be particularly vulnerable (such as the elderly, the disabled, and minors) and to the nature of the breach; Handle the theft of confidential client information differently than the stealing of employees’ Social Security numbers.
  4. Have legal counsel review the method and content of all communications.
  5. Prepare for media inquiries to deliver a clear message for parties affected directly or indirectly. Be sure that your spokesperson is qualified and trained to deal with the media.
  6. Provide ways for victims of the data breach to ask additional questions and/or learn how to minimize potential harm.
  7. Test the plan: If you had to execute it, how well did it work, and how did you update it? Many businesses have discovered holes in their response plans after failing to consider the impact of a cyber security data breach on daily operations, or underestimating the attention the event drew.

To learn more about spreading the word after a data breach, please get in touch with us.

In The Cloud? Protect Your Data

the cloudMore and more businesses are storing data on off-site service providers (known collectively as “the cloud”) to reduce costs and boost efficiency. However, many companies either don’t realize how vulnerable this information is, or don’t have contracts that make third-party cloud providers responsible for lost, stolen, or corrupted data. Check out five of the top data breaches of 2013 here.

If there’s a data breach when you’re using cloud-based services, who should be held responsible? Storing software and/or databases on the servers of a cloud provider with shared infrastructure immediately eliminates many of your cyber security controls. Backing up data in multiple locations increases the likelihood that it will survive, but also raises the odds of a data breach. What’s more, shared infrastructure can leave this information exposed to malware or other computer viruses.

What about connectivity? After all, your cloud provider can’t guarantee that you’ll have access 100% of the time. If the remote server goes down or there’s a data breach, how long might it be before you’re able to restore operations? How might such an incident affect your company’s reputation, and its financial position?

An effective Cyber insurance policy can reduce these risks significantly by:

  1. Allowing you to limit the spread of sensitive or confidential information by reacting to cyber extortion as soon as possible
  2. Notifying your clients that their data has been lost
  3. Hiring a PR firm to get out the message to clients about the measures your company is taking to prevent future breaches
  4. Providing the ability to set up a data center
  5. Reimbursing customers and clients for confidential information compromised by the breach

Our agency can help you select comprehensive coverage that can protect your data in the cloud. Give us a call today.

Target Security Breach – Wake Up Call

security breachThe security breach of customer data at Target Corp. during the recent holiday season underscores the growing threat of cyber theft to retail businesses.

Between last November 27 and December 15, hackers stole data on up to 110 million debit and credit cards from customers of Target, the nation’s second largest discount store. The security breach occurred when a virus infected the company’s point-of-sale terminals throughout the chain, compromising debit and credit cards account numbers, expiration dates, cardholder names, e=mail addresses, home addresses, phone numbers, and credit verification value – information that bad guys have used to make counterfeit credit cards.

Immediately after a third party discovered the security breach, the retail giant: 1) alerted the relevant authorities and banks; 2) partnered with a forensics firm to investigate the crime; and 3) warned recent customers to monitor suspicious bank account activity, and contact the Federal Trade Commission and credit card monitoring systems portals. Said Chief Executive Officer Gregg Steinhafel, “Target’s first priority is preserving the trust of our guests, and we have moved swiftly to address this issue, so guests can shop with confidence.”

The company fended off thousands of complaints from customers about fraudulent charges on their credit cards and bank accounts, as well as dealing with a significant number of class action lawsuits alleging invasion of privacy.

Although it’s too early to put a price tag on the security breach, in 2009 retailer T.J. Maxx paid $9.7 million in a settlement with 41 U.S. states over the loss of customer data after hackers stole information on 45.7 million credit and debit cards two years earlier.

The Target data breach offers a stark reminder of why your business needs to protect confidential customer information – and to carry Cyber Liability insurance.

We’d be happy to help the cause. Just give us a call.

Internal Fraud – Fight Back!

An industry seminar on fraud risk, prevention and response, found 778 internal fraud cases in 2012  (more than two a day!) These scams included fake billing, corruption, and expense reimbursement.

Although the companies affected suffered minimal losses in more than half of these cases, their headaches came from private civil claims, potential government investigations, criminal prosecutions, and bad publicity.

Fraud can be uncovered by everything from employee tip-offs and management reviews to internal audits and even “gut” feelings by an experienced observer.

If you’ve been scammed from the inside, start with a prompt and thorough internal investigation. Gather the facts, preserve evidence, assess legal repercussions, and take corrective action – before an outside authority does. Being the first to report the incident to the government can take the sting out of an official probe.

internal fraud
To correct the situation you should:

1) make amends to the victims

2) revamp corporate-compliance programs

3) strengthen internal controls. Make sure that these actions are tangible and specific.
Consider offering substantial financial incentives to employees who might suspect that something fishy is going on, but may not want to get involved.

Lastly, insurance can help protect your business from the loss of money, securities, and inventory resulting from employee dishonesty. For example, Fidelity and Crime coverage usually includes property theft, losses due to forgery, and electronic wire transfer fraud.

Your insurance program should include a cyber policy. A recent court decision expands coverage of cyber losses under fidelity bonds. Damian Brew, managing director of Marsh’s FINPRO practice warns, “Having insurance coverage without cyber insurance is like playing hockey without a goalie.”

Our business insurance professionals would be happy to review your internal fraud-control program. Just give us a call.

Lessor’s Risk Insurance – Protection for Landlords

If you rent out residential property, you face a variety of financial risks… everything from damage from fires and windstorms, through fines for building code violations, to a disgruntled tenant who sues you.Lessor's Risk

Lessor’s Risk insurance to the rescue! These policies cover losses to the property, medical payments for tenants or visitors injured on the premises, and your personal liability for alleged negligence.

The amount of coverage depends on your financial situation. If you’ve taken out a mortgage on the property, the lender will probably insist that you buy a policy large enough to cover the loan balance. As a rule of thumb, the higher the value of the property and the greater the risk of potentially catastrophic liability, the more coverage you’ll need.

Your premium will depend on the type of losses covered and the extent of reimbursement. If you choose comprehensive or all risk coverage (which will pay for damage from all causes unless specifically excluded), your cost will be higher than if you buy “named perils” coverage (which covers only losses due to specific causes). Expect a higher premium for replacement value, which will reimburse you fully for rebuilding your property, than for actual cash value coverage, which will pay only the value of the property, less depreciation.

You can also reduce your premium by increasing the deductible of your Lessor’s Risk policy, which usually ranges from $100 to 5% of the building coverage.

Optional coverages include repayment for rental income lost if the property becomes uninhabitable, and for risks of doing business with tenants, such as legal fees and liability against claims for libel, slander, and discrimination.

Our personal insurance specialists would be happy to help you select a Lessor’s Risk policy that offers the best value. Just give us a call.

Walt Disney, Magical Advice for Business (and Life)

Walt DisneyIn the world of entertainment, perhaps no name is more widely known than that of Walter Elias Disney. Today marks the 112th anniversary of his birth, and has me reflecting on the impact this great man – the Magic behind the Kingdom of creativity – has had on our world. He was such an influential innovator and entrepreneur in his day, and even now, he is teaching still. Using some quotes from the legend himself, here are a few of the lessons I’ve learned from Walt Disney – about business, and life.

Dream big.

“All our dreams can come true if we have the courage to pursue them.”

What would you do if your dreams had no limits? Don’t let your comfort zone hold you back from where your dreams would take you. We have so many fears – fear of the unknown, fear of not being good enough, fear of what others may think, fear of failure. Insurance can mitigate many risks, and often we fear something that will never happen. If you have a dream, chase it. Find a way to make it happen and above all, don’t let anyone else limit your dreams.

Communicate your vision.

“Of all the things I’ve done, the most vital is coordinating those who work with me and aiming their efforts at a certain goal… you can design and create and build the most wonderful place in the world. But it takes people to make the dream a reality.”

You have a vision. Success in bringing your dream to life is directly related to how effectively you communicate that vision to the people you work with. According to a study published in Claremont McKenna College’s Leadership Review, when leaders discuss their organizations’ vision in a specific way, not only is the vision better understood, the leaders are also seen as being more effective in general. Want to have people who are as invested in your dream as you are? Communicate your vision with clarity and passion.

Send the right message.

“Disneyland is a show.”

What kind of experience are you providing for your clients? Remember that everything you do (and everything you don’t!) is communicating a message. From your voicemail greeting right down to delivering your product or service to the consumer, all of it is speaking for you. Make sure it’s saying the right thing.

Embrace your setbacks.

“Everyone falls down. Getting back up is how you learn to walk… all the adversity I’ve had in my life, all my troubles and obstacles, have strengthened me… you may not realize it when it happens, but a kick in the teeth may be the best thing in the world for you.”

Don’t waste any experience. Difficult circumstances hold within them lessons to be learned. Often what we perceive as a negative situation can become a catalyst for personal and professional growth. Take the experiential wisdom gained with setbacks and carry it with you into the future. You (and your business) will be better for it.

Just do it.

“The way to get started is to quit talking and begin doing.”

I don’t know about you, but I have a lot on my plate… and I don’t have a magician’s apprentice to help me get it all done. At times it can be overwhelming. Taking a cue from Disney, if you’re obsessing about a massive to-do list, it’s time to stop thinking stressing about everything in front of you and just.do.something.

Aspire to Excellence

“Whatever you do, do it well. Do it so well that when people see you do it they will want to come back and see you do it again and they will want to bring others and show them how well you do what you do.”

Yeah. What HE said. :-)

How about you? Do you have a favorite Walt Disney quote? We’re discussing today over at our facebook page. Join us!

 

 

 

Cybercrime & Fraud – 7 Ways to Fight Back

cybercrimeHow secure are your business assets? How much thought have you given to cybercrime? According to the Association of Certified Fraud Examiners (ACFE), companies with less than 100 employees lose an average of $155,000 a year to fraud. Small businesses also have a higher fraud rate than larger firms and non-business owners.

Don’t be a victim! To help protect your business against losses from scam artists and cybercrime, security experts recommend taking these precautions.

  1. Separate personal banking and credit cards from your business accounts to ensure that scam artists don’t get their hands on all your money; this will also make it easier to track business expenses and tax deductions. Pay bills online or make sure to store paper bills securely.
  2. Invest in a firewall as well as anti-virus protection, and spyware- malware detection software Provide offsite backup to keep your business up and running after a cyberattack.
  3. Secure your IT infrastructure by using a dedicated computer for all online financial transactions. If possible, avoid using it for other online activities (such as social media, email and web-surfing) which can open the system to cyberthieves.
  4. Make sure that passwords are complex (with one upper-case letter, one number and at least eight characters), have them changed regularly, and assign different passwords for separate accounts.
  5. Hold regular training sessions for all staff on basic security threats and prevention measures.
  6. Use background checks for all employees who handle cash or high-value merchandise or have access to sensitive data.
  7. Buy insurance to protect your small business against losses from fraud or cybercrime.

We’d be happy to answer any questions you might have about cybercrime, and to tailor coverage to your needs – at a price you can afford. Just give us a call.

How Well Do You Know Your Insurance?

With so many demands on their time, many business owners find it difficult to learn enough about their insurance programs.

insuranceYou’ve probably found yourself asking questions such as:

  1. Do I have the right coverages to protect my business from financial loss?
  2. Do I have any exposures to loss that aren’t covered and should be?
  3. Exactly what am I buying?
  4. Am I getting the best value for my premium dollar?

As insurance professionals, we help you answer these questions because we:

  • Offer policies providing protection against a wide variety of risks that can threaten your business – everything from Accounts Receivable and Business Interruption to Employment Practices Liability and Glass Insurance to Theft coverage and Workers Compensation
  • Recommend an insurance company (from among the quality carriers that we represent) that will provide quality protection
  • Make it a point to learn how your business works so that we can pinpoint potential sources of loss
  • Design a program that minimizes the impact of these losses (incidentally, we don’t always recommend insurance)
  • Provide comprehensive protect that’s tailored to your needs – and your pocketbook
  • Work with you to make sure that your coverage stays updated as your business grows

In short, we take over one phase of your business for you, and work with you to accomplish your first goal – protecting your profits.

To help us help you make sure that your business insurance makes business sense, please feel free to get in touch with our agency at any time.

We’re here to serve.

Inland Marine Insurance: Don’t Go Near the Water

inland marineAlthough you have insured the business property on your premises, this protection does not extend off site – unless you carry Inland Marine insurance.

This type of policy goes back as far as the 17th century when Lloyd’s of London extended coverage on ship cargos beyond ocean voyages to their final destination “inland.” Today, Inland Marine covers the property of a business when it’s in transit – or stored at a location away from the premises – as well as the property of third parties that’s held on the premises. Because this property is essentially “floating,” these policies are also known as Floaters.

Inland Marine coverage would apply in such scenarios as:

  • A truck carrying designer handbags for an upscale department store is hijacked at a rest stop.
  • A hailstorm damages bulldozers on a machinery dealer’s lot.
  • A fire at a dry cleaners scorches customers’ clothing.
  • A defective sprinkler system in a “big box” store warehouse soaks dozens of TVs.

You can buy Inland Marine insurance on either a “named peril” basis (which lists the specific risks covered) or as an “all risk” policy (which covers losses from all causes not specifically listed).

This coverage can provide valuable protection for the mobile or moveable property of almost any business, large or small: everything from camera shops and computer manufacturers through building contractors and jewelry stores to museums/art galleries and trucking companies.

As Business Insurance professionals, we can tailor a comprehensive Inland Marine policy to the needs of your company. Feel free to get in touch with us at any time.