So You’re Saying There’s a Chance!

About the only thing in this world that we can safely bet on is change. Nothing stays the same forever, thank goodness! Some of the changes we face are well calculated and some are just a plain slap in the face. Either way, we are faced with daily sometimes even hourly new decisions that need to be made which will again create change. See, I told you, we cannot escape it.

Regardless of the service or product your business focuses on, some things are more intangible than others. The intangible benefit of working with KC Insurance Agency Group creates a value relationship based on supporting your businesses core needs, allowing you to focus on delivering your tangible assets to your clients.

Making the change to our agency for you means change. We understand that the concept of changing can come with both apprehension and confusion. Have you asked yourself any of the below questions regarding your business insurance?

  • Do I have enough or the proper coverage?
  • Why are my Workers Compensation premiums so high? Can anything be done?
  • What is my agents name again?
  • Who can help our business with HR issues, loss controls and premium stability?

Local, professional and aggressive, we are solution makers! We want your business, are committed to the whole process of consulting, marketing and serving your accounts here at our Imlay City office. We are not a transactional agency; we will invest ourselves and make the transition as seamless as possible.

You have the power to change how you incorporate your already necessary commercial business insurance in a way that you never thought possible. Let us help you put the value back in your coverage and have it finally go to work for you!

Holiday Spirits

Ah the holidays. Eating, drinking and being merry. If you are entertaining guests or just find yourself with a little extra time this holiday season, I have put together some great local breweries that will be sure to keep you jolly!

It really does not matter what area of Michigan you are in, you are close to a great beer. The infamous Atwater Brewery, Frankenmuth Brewery and Motor City Brewing Works are surrounded by other local legends. In no ranking order, and by no means a complete list, below are some highly regarded breweries in Oakland/Macomb Counties and a little bit about what makes them so special!

Macomb County

  • Sherwood Brewing Company – Located on Hayes Rd in a plaza might be the last place you would think you would find an authentic brewery. Think again! All beer, wine and soda are made in house. Menu has something for everyone and my personal favorite, Spinach and Artichoke salad paired with their house Blondde Ale.
  • Dragonmead Microbrewery – You can literally find their beer everywhere! If you are looking for a unique atmosphere, head to 11 Mile in Warren where you find beer from American Ales to winter season Norwegian Jul Ol Christmas Ale. Visit their website for full descriptions of their available beers, very handy for those who need a little help choosing!
  • Other Must See’s – Kuhnhenn Brewing, Falling Down Beer Co.

    Oakland County

    • Black Lotus – This brewery has a philosophy that goes beyond! “Think Global, Drink Local” is a way of life for Black Lotus. Dedicated to serving its patrons and community with killer bar food and seasonal beers that have to be experienced. Located with the unique address of 1 E. 14 Mile Road, this Clawson brewery should not be missed.
    • Rochester Mills Beer Company – Right in the heart of Rochester lays a brewpub with an atmosphere as comforting as the food and drink. Great bands, pool tables, a sprawling bar and great made in house craft beers!

    Other Must See’s – Woodward Avenue Brewers, Griffin Claw, 51 North, Royal Oak Brewery, Bastone Brewery.

    Please always remember, don’t drink and drive

What’s Your Plan, Stan?

All operations big and small need to have plans for the unexpected. So in the event of an emergency, or maybe a very large order, financial resources, communication procedures and logistics are ready to respond. If it has the chance to disrupt the normal operational flow, it needs to have a pre thought out plan to insure you and your business comes out on top.

When the warehouse is burning down, your state is experiencing a terrible natural disaster, or an unexpected death of a key executive occurs, this is NOT the time to think about what your plan should be. Even with the calmest under pressure management, crises management plans need to be handed pre event, not during or post.

Our company forklift driver pierced large barrels of chemicals in our warehouse! How important are environmental and emergency response regulations that apply to my business? Very, and this is generally a requirement to be included in many regulatory permits that are business specific. If you are not sure where to start, in Michigan, The State of Michigan Department of Environmental Quality will provide businesses with necessary expertise on environmental risks. For facilities that use or handle substances that have a potential threat to humans or the environment, from spill control and prevention, hazardous waste and air pollution, Local Emergency Planning Committees along with police and fire departments have emergency planning and training to step in at a moment’s notice. This is an important part of a Contingency Plan since spills or exposures to chemicals can interrupt operations and be costly.

IT Asset Security is one of the most critical components of a solid Continuity Plan. When you think of intellectual property that could be stolen or destroyed such as trade secrets, computer programs and equipment, this is Asset Security and nothing to mess with. Your contingency plan should have a backup of corporate records. If key machines are lost and you are unable to produce your product and not meet your customers demands, Contingent Business Interruption (CBI) insurance can help soften the financial impact.

Many factors will influence your business Contingency Plan. Here is a 8 step outline of procedures to use when writing a Contingency Plan.

  • Set up a contingency planning committee and choose someone to lead the group
  • List every business process in each department
  • Discuss key assumptions with management in each department
  • Prioritize each assumption in order. Play the “what if” game
  • Decide how you will compensate if something negative occurs to stay profitable
  • It takes a village to raise a child, same applies here. Get the input of many!
  • Take a second look. Go over the contingency plan again, find areas that may have been missed
  • Practice makes perfect! Test your contingency plan. Sometimes conflicts occur between departments’ contingency plans. This is generally found in the interdepartmental review. Play role scenarios without shutting down systems. After review tests have been completed, bugs have been worked out; it’s time for the final number. Fully test your plan, set aside time to shutdown areas in real time, putting your contingency plan into full effect.
  • Working with a knowledgeable insurance agent on what areas of your contingency plan are covered by your existing insurance coverage, and what might not be, is a great way to secure financial stability of losses. Work scenarios out with your agent; find out the most effective way to modify your commercial insurance policy to meet your needs.

Commercial Auto, the Good, the Bad and the Ugly

Many companies are not sure where their exposures start and stop as it pertains to employees using their own auto in the course of business. Here is a quick list of the most common (but not all) exposures that could have an employer in hot water if they do not have the right or enough coverage.

  • Employees that run errands on lunch for company purposes (examples; going to the bank, taking mail to post office, purchasing office supplies)
  • Employees that visit clients
  • Employee making a delivery to a client

If you are cringing at your desk or frantically pulling out your commercial auto policy to review, hang in there, I will tell you what to look for next.

Hired and Non Owned Auto is a coverage either found on your GL (General Liability) policy or possibly on its own policy, covering these exposures as well as a fleet or other vehicles used for your business.

  • Hired – This is the rental of a vehicle in the company’s name for company business. Not for when an employee’s leases a vehicle, but for the exposures of an employee traveling for business and renting a vehicle to get to and from meetings.
  • Non- Owned – Is the use of a personal vehicle by an employee or volunteer for company related business.

You may be asking yourself, what is the concern for my business?! I thought employees were responsible for properly operating his or her own vehicle! If an accident occurred, wouldn’t my employees’ personal auto policy respond? The answer is yes, it would. But wait there’s more! The ugly to this is that your company could be brought into the situation under vicarious liability. Here are some examples an action might be brought against you as the employer if the employee;

  • Does not carry personal auto insurance or only carried state minimum limits
  • Did not properly maintain vehicle
  • Has a motor vehicle report (MVR) that has infractions

Claim Example:

Sally Jones works for ABC Tech and drives to the bank each week, as a requirement of her job. One day, Sally drives to the bank and makes a deposit. On her way back to the office, she runs a red light, causing a collision with another vehicle. Both vehicles are totaled. There are serious injuries to the other vehicle’s occupants, one of whom is a small child. Sally is charged with failure to stop for a red signal light.

The subsequent investigation revealed that:

  • Sally carried only the state-mandated minimum limits of $50,000 of automobile liability coverage.
  • Sally’s MVR showed that she had three speeding tickets within the last two years and had been cited for failure to yield at an intersection.

As a result of the collision, the following actions take place:

  • The other driver and the other driver’s insurance company bring a claim against Sally and her insurer under Sally’s policy.
  • Sally’s insurance company pays its policy limit of $50,000. However, the total value of the claim is set at $1,000,000.
  • The other driver hires an attorney and names Sally and ABC Tech as co-defendants in a lawsuit, seeking the remaining damages and alleging that:
    • Sally was negligent for failing to stop for a traffic control device, driving recklessly and speeding.
    • ABC Tech was negligent for failing to perform due diligence before permitting Sally to operate a motor vehicle on company business – and for not securing a copy of Sally’s MVR, not properly evaluating it, and not properly supervising the employee.
    • ABC Tech is vicariously liable for Sally’s actions because Sally’s negligence occurred while she was performing a work-related errand.

If the plaintiff is successful in the lawsuit, ABC Tech could potentially be responsible for $950,000 in damages:

  • $1,000,000 Total claim value
  • $50,000 Sally’s policy limit
  • $ 950,000 Damages ABC Tech would have to pay

What’s more, if the jury determines that punitive damages are warranted, the costs could be two to three times the $950,000 underlying damage amount.

AAAHHHHHH!

Bottom line, an employer’s commercial auto exposures are real. Working with the right agent will help identify your exposures, provide options on minimizing risk and negotiate with carriers on the coverage’s you need!

Claim scenario taken from The Hartford, common auto loss file

If the Three Little Pigs blow your building down, do you really know what it takes to rebuild?

Most property owners understand that they need property coverage to indemnify them if they have a loss. Now if Three Little Pigs actually blow down your building, that is not going to be a covered peril, so you are out of luck but knowing what is covered and what might be is so important. As a property owner, this will help so you know if your coverage is complete or has gaps that could cost you big.

Let’s start at the beginning. You will need to know the construction of your building. The most common construction for commercial buildings is Masonry Non-combustible. This means the building has masonry load bearing walls and unprotected steel roof supports, generally brick or concrete. These equal to noncombustible or slow burning floors and roofs which mean to you that your construction style allows for a higher probability that you will not suffer a total loss in the event of a fire.

Covered causes of loss…so I already mentioned pigs’ heavy breathing is not covered. What is covered is natural wind, and fire of course, along with other covered causes of loss as long as a direct physical loss to your property occurs at the described premises, you can file a claim. There are three types of causes of loss forms, know which one you have and the options of the others. (Side note, all property policies are different, so although this is a standard ISO statement, it might not be true to your particular policy).

The most critical component of commercial property coverage is in its valuation. Working with a Commercial Insurance Coverage Specialist will help insure that you are getting the appropriate valuation for your property, because if you do not, co insurance penalties are no laughing matter. Valuation should be based on property replacement cost, which is an added endorsement. Otherwise you are dealing with actual cash value which takes depreciation into account.

How is the replacement cost determined? I am always hearing my clients tell me, “I can only get $500,000 for my building if I sell it, what do you mean I need to insure it for $1.2 million dollars!” Replacement cost is determined by the cost incurred today to rebuild your property to new (indemnify) if you experience a loss. Depending on age, construction, size and a host of other factors, a skilled agent will calculate using cost estimator tools what your replacement cost figure should be. From there, you and your agent have a variety of options to add or delete coverage’s to meet your specific insurance needs.

This is a pretty basic overview of commercial property; so much goes into insuring a commercial property correctly. Future blogs will consist of insuring multiple properties on a blanket property form, protection class, types of sprinkler systems and an overview of how commercial property is rated.

If you would like to hear about a specific topic, let me know!

Balancing Act

When it comes to caring for a loved one, regardless of why they need you, it is important to create a balance. The definition of blogging is; a website that contains online personal reflections and comments. So when I was asked to write a blog it came natural to write about creating a balance in life. This is a daily, or should I say an hourly struggle that young professionals like myself endure. Two full time working parents, a home, two small children and if there is any time left a social life. I know what you’re thinking, everyone does it! Yes, this is true but the execution can vary greatly.

The nagging need to fill my professional void took me back to the workplace after a six year stent in the pen. And by pen I mean my home! With a degree in hand and time management skills that would blow your socks off, I put a resume together and landed myself in the insurance industry.

Funny thing is, I value my time at work as much as my time home. Not because I rank one higher than the other, but I believe that equally each one makes me better at the other. I am not a list maker or a planner, but I don’t fly by the seat of my pants either. Creating a balance between work, home and my social life has been easier because of the value I place on each part of who I am and how I spend my time.

The one day a week I get to place my kids on the bus in the morning speaks volumes. It takes away the guilt of that after hour’s business meeting or that hour long workout class which means I miss bedtime. I encourage all young professionals to work towards quality not always quantity. Let go of the “need to do it all” mentality, if you’re feeling overly guilty your balance of value might be off, don’t fret, just reevaluate and never be afraid to ask for help!

Michigan’s Insurance Requirements

Michigan law requires no-fault insurance. Every registered car must be insured. Every car owner must buy basic coverage in order to get license plates. It is a misdemeanor to drive or let your car be driven without basic no-fault coverage.

If you are convicted of driving without basic no- fault insurance coverage, you may be fined up to $500, put in jail for up to one year, or both. You may also incur additional fines and costs pursuant to the 2003 Michigan’s Driver Responsibility Law. For details please go to www.mi.gov/driverresponsibility

If you are unable to produce proof of insurance when requested to do so by a law enforcement official, you may be found guilty of a civil infraction. The court may order your license suspended for at least 30 days or until you are able to provide such proof. You may have to prove you purchased a pre-paid non-cancelable insurance policy before you may renew your vehicle’s registration.

Information taken from: Department of Insurance and Financial Services