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.

Safety Inspections: Bad for Business, or Improving the Bottom Line?

Although no one really likes OSHA inspections, and complaints abound about the expense of compliance with regulations, a recent study conducted by the journal Science shows that workplace safety and health inspections by OSHA not only save lives, they also decrease workers compensation costs and actually do not hurt the bottom line.

OSHA frequently receives criticism from both organized labor and big business, with one side claiming that the organization doesn’t do enough to protect workers, and the other bemoaning what it says are unnecessary costs.

Three professors from the University of California, Harvard Business School and Boston University say they set out to answer a simple question: Do government regulations kill jobs… or protect the public?

The study took 409 California industries that had high injury rates and were inspected by California OSHA from 1996 through 2006, and compared the results of those businesses with 409 similar companies that were not inspected in that time period. Companies undergoing random inspections saw a 9.4% decline in injury rates, and a 26% reduction in injury costs.

“Our study suggests that randomized inspections work as they’re meant to, improving safety while not undermining the company’s ability to do business,” says Michael Toffel, environmental management expert at Harvard Business School. “Now we’d like to get more data to see exactly how inspections reduce injuries, and to investigate what kinds of companies would get the most or least benefit from safety regulation.” According to Toffel, his interviews show that injuries decrease after inspections because the inspectors talk with operators and make sure they understand what the problems are and then discuss ideas for fixing them.

Read the full article at the Insurance Journal.

WC Rates to Increase Significantly

Many expect Workers Compensation rates to increase significantly this year. The MA Workers Comp Rating and Inspection Bureau has recently applied for an average rate increase of 19.3% (click here to read the full article from the Boston Globe). According to the Insurance Journal, commissioner Joseph Murphy will be holding a public meeting on this request.

Whatever rate increase is approved by the insurance commissioner will be effective September 1st, with the negotiations for the final rates continuing through most of the summer. We believe the final rate increase this year will be in excess of 10%. The rate for residential carpentry is currently 8.68. If the commissioner approves the increase of 19.3% the new rate would be $10.30. This is significant. If you have a payroll of $100,000 this will increase your cost by more than $1,500.  

You might wonder, “Is it possible to avoid these rate increases?” The answer is “yes.” There are some insurance programs that are available today that will guarantee your maximum rate for three years. This program is not available to all employers in MA. It is available to the best contractors that have had good experience. So long as your losses are under control and you have premium of over $5000, you may qualify. Please call us to see if this three year program to keep your Workers Comp costs under control is right for you. By making the switch today, you can avoid the increased rates, at least for the next few years. You do not need to wait until your policy comes up for renewal, you can start saving now.  

Remember, Workers Comp costs are controllable, and every dollar you save in Workers Comp premium goes straight to your bottom line as profit. Call us today to see if you qualify for this program and start saving on Workers Compensation premiums.

Definition of a “Subcontractor” – Know Who You’re Hiring

How do you define “independent contractor”? Misclassification of employees is a critical issue for workers and businesses. Because the potential penalties for noncompliance are so severe, we thought it beneficial to remind you of the amended definition of who is an independent contractor. In this post, we will tackle the Massachusetts Law. The MA Independent Contractor Law Amendment of July 2004 is designed to help employers distinguish employees from independent contractors using a clear, rigid 3-point test.

1. The worker must do their work independently and be self-sufficient. They must complete the job using their own approach without instruction and determine the hours they will work on the job. For Workers Compensation, if you provide materials they do not meet this test.

2. If the worker does the same work you normally do, the worker is not an independent contractor. A good example of this would be a company that specializes in window and door installation, if the worker installs windows and doors, under these tests, they cannot be classified as an independent contractor.

3. The public must see the person providing the labor as an independent business.

These 3 factors are not flexible and the law states that if all 3 are not met the worker is deemed an employee for MA workers compensation and wage laws. If a violation has been committed the employer can face substantial civil and criminal penalties. The maximum penalties carry a potential fine of $50,000 per civil violation and criminal violations could result in prison time as well as criminal fines.

For more information, please see An Advisory from the Attorney General.

New Hampshire’s definition of a subcontractor is also far more restrictive than the Federal government. In our next post we’ll look at the state’s 12-prong test for determining what classifies as an independent contractor.

Have you run into issues with subs being misclassified? We’d be interested to hear them. How did things turn out?

Regardless of where you live, knowing and understanding the state law and its definition of “subcontractor” is key to protecting yourself, and making sure you don’t get hit big at audit time. While it may be tempting to treat all your help as subs rather than employees, unless they truly are independent contractors, it’s just not worth the risk.

Definition of a Subcontractor – Know Who You’re Hiring

How do you define “independent contractor”? Misclassification of employees is a critical issue for workers and businesses. Because the potential penalties for noncompliance are so severe, we thought it beneficial to remind you of the amended definition of who is an independent contractor. In this post, we will tackle the Massachusetts Law. The MA Independent Contractor Law Amendment of July 2004 is designed to help employers distinguish employees from independent contractors using a clear, rigid 3-point test.

1. The worker must do their work independently and be self-sufficient. They must complete the job using their own approach without instruction and determine the hours they will work on the job. For Workers Compensation, if you provide materials they do not meet this test.

2. If the worker does the same work you normally do, the worker is not an independent contractor. A good example of this would be a company that specializes in window and door installation, if the worker installs windows and doors, under these tests, they cannot be classified as an independent contractor.

3. The public must see the person providing the labor as an independent business.

These 3 factors are not flexible and the law states that if all 3 are not met the worker is deemed an employee for MA workers compensation and wage laws. If a violation has been committed the employer can face substantial civil and criminal penalties. The maximum penalties carry a potential fine of $50,000 per civil violation and criminal violations could result in prison time as well as criminal fines.

For more information, please see An Advisory from the Attorney General.

New Hampshire’s definition of a subcontractor is also far more restrictive than the Federal government. In our next post we’ll look at the state’s 12-prong test for determining what classifies as an independent contractor.

Have you run into issues with subs being misclassified? We’d be interested to hear them. How did things turn out?

Regardless of where you live, knowing and understanding the state law and its definition of “subcontractor” is key to protecting yourself, and making sure you don’t get hit big at audit time. While it may be tempting to treat all your help as subs rather than employees, unless they truly are independent contractors, it’s just not worth the risk.