Business Insurance

Commercial Auto Insurance and Telematics

If you’re a Florida business owner, you probably noticed that your commercial auto insurance rates went up at your last renewal and you may be wondering why.

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Long story made short, most insurance carriers spent more money paying claims than they made collecting premiums in 2016 and 2017.   How did this happen?  Every day we have more cars on the roads and more smart phones in drivers’ hands.  Medical costs continue to rise as do vehicle repair costs.  These are only a few of the driving factors behind the rate increases.

Is there any hope for a business owner to gain more control over these increases?  Many businesses are implementing something called telematics to improve their fleet’s risk management program.  Telematics is a way to monitor vehicles by combining GPS with on-board diagnostics.  A few of the more common uses include tracking where your vehicles are, how fast they are traveling, what speed they are turning, and how suddenly they are braking.

Consider the issues you are facing when selecting a telematics vendor for your fleet.  For example, an organization with delivery trucks may want assistance with route optimization, while a service oriented fleet may be more concerned with features such as idle time tracking.  Your insurance agent can be a great resource to assist with the vendor selection process.

Once you are setup and have all the data coming in, it’s important to work on creating a suitable report that helps your management team decipher it all.  Many use a ranking system or scorecard to show who are repeat offenders of aggressive driving events.  Create an action plan on how to deal with your offending drivers to ensure the success of your telematics program.  Proper communication and coaching of first time offenders is often the best solution, but more serious consequences may be necessary for repeat offenders.

Telematics can help a business protect their employees and fleet, which in turn will help reduce the cost of insurance.  In the future, don’t be surprised to see underwriters trend towards requiring telematics as they look for ways to address the rising cost and occurrence of commercial auto claims.


About the Author

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James Lynch is a Sales Executive at Bouchard Insurance. James specializes in Property & Casualty, Workers’ Compensation, and Health Benefits for large commercial accounts. |  Connect on LinkedIn

Your Employee Got Hurt On The Job... What Now?

There are always questions in an employer’s head when an employee gets hurt on the job. Do we need to send the employee to the hospital? Do we need to send them to the clinic? Did the employee actually get hurt on the job?  Do I need to record this on my OSHA log?

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These are all fair questions, and there is no silver bullet answer to any of them. All of these questions depend on the circumstances surrounding the injury. But, one of the most cut and dry questions an employer can answer is: do I need to record this on my OSHA log? Many companies feel the best way to avoid hefty OSHA fines is to record all of their injuries, similarly to how a company should report their Workers Compensation claims. However, the requirements for OSHA are much different than insurance companies. For some larger companies who have several claims a day, recording every minor incident to OSHA can be quite a hassle and not exactly great for the image of the company either.

The general guideline for OSHA recordability is that an employer must record an injury when it requires treatment beyond first aid. But, even this definition can be misconstrued because “first aid” is a fairly vague term. “First Aid” by OSHA’s guidelines even includes having an employee get an x-ray as a pre-caution to rule out a fractured bone, as long as the result is negative. In some people’s eyes, getting an x-ray performed would be considered beyond first aid.

So, how is an employer supposed to know when exactly to record injuries to OSHA? Well, there are a few tools we have found that can help tremendously. One very simple solution is to contact OSHA or your Workers Compensation clinic for a “Guide to OSHA Recordability” sheet that lays out the guidelines of First Aid vs Medical Treatment.

Even better than that, there are new software tools available that can help businesses with OSHA recordability as well. ZyWave, for example, is a software tool that we offer to our clients for no additional charge because we see the true value that it offers. Under the “OSHA” section of ZyWave, there is an “OSHA Recordability” tab which, when clicked, will start up a program that will run the employer through a few simple questions. How the injury happened, what treatment was given, etc. After a few questions, this program will tell the employer whether or not this incident needs to be recorded for OSHA or not. If the incident needs to be recorded, the employer can then choose to take the information given by the employer in the previous questions to begin automatically completing an online OSHA 300 Log, which the client can then access at any time in the future.
 
In addition to determining if an injury is beyond “First-Aid” or not, recording severe injuries in a timely manner is one of the MOST important parts that employers must be conscious of. An employee hospitalization, amputation, or eye loss on the job must be reported within 24 hours to OSHA. And, any work-related fatality must be reported within 8 hours.


About the Author

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Eric McCaugherty is a Sales Executive at Bouchard Insurance. Eric specializes in Property & Casualty, Workers’ Compensation, and Health Benefits for large commercial accounts in the construction industry. | Connect on LinkedIn

EPLI & The #MeToo Movement

It seems like we can’t turn on the television lately without hearing about a sexual misconduct claim. The #MeToo movement has sparked a downpour of individuals coming forward with accusations of sexual misconduct in the workplace. As this fire is continually fueled, so is the need for business owners to address the possibility that this may affect their organization.

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Employment Practices Liability Insurance provides protection against claims arising from harassment, discrimination, wrongful hiring and firing, and other employment-related issues. While it is easy to assume that would never happen to one’s business, claims do not have to be factual to draw up hefty expenses. Think of EPLI as prepaid defense costs.

Between 2010 and 2017 alone there were over 200 thousand sexual harassment charges filed with the U.S. Equal Employment Opportunity Commission, as stated by Verisk.

According to Trusted Choice, within the past 2 decades, employee-filed lawsuits overall have risen roughly 400%. Disturbingly, statistics also show you are more likely to be sued by an employee than have a fire at your business.

It’s not just the large organizations of the world being impacted by these claims. According to Trusted Choice, over 40% of employee-filed lawsuits are brought against private companies with fewer than 100 employees.

EPLI extends beyond these accusations. It offers protection for a variety of suits including statute violations, wage and hour violations, wrongful denial of workers’ compensation, false positives from drug tests, libel, slander, breach of contract, fostering a hostile environment, emotional distress, and much more.

To learn how to best protect yourself and your business, contact one of our agents.


About the Author

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Madison Lieffort is a Sales Executive at Bouchard Insurance. Madison specializes in Property & Casualty, Workers’ Compensation, and Health Benefits for large commercial accounts. | Connect on LinkedIn

Cyber Coverage (Spoiler: Go get it, right now)

Cyber risk, what most business owners in the internet boom of the 90’s thought was just a movie trope, is actually a very common risk now.

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Ask any insurance agent when introducing cyber coverage to a client and these are the objections they hear most often:

1.     “Well, we’re not a huge company that would be a target.”

2.      “We invest thousands of dollars into our servers and virus protection, we’ll be fine.”

3.      “We have the financials to recover from a cyber breach.”

Let’s re-evaluate

If you’ve ever said or thought any of these, it’s okay, you’re not alone. Cyber policies are new, and it’s easy to think it can’t or won’t happen unless you’ve been affected by a breach first-hand. As a consultant, our biggest challenge isn’t selling what we do, but rather giving a different perspective to our clients to make certain they fully understand the risks that face their business. We’re in the business of hoping for the best but preparing for the worst. That said, our ever-increasing reliance on technology platforms has created an exposure that changes daily. I put an emphasis on daily, because the technology behind breaches is updated as often as your cellphone or laptop asks you to update the operating system. Groundwork laid, let’s dig into why every business owner should be talking about their cyber coverage. 

 1. Doubt

When it comes to your personal cyber exposure, the numbers tell a story. Believing your “mom and pop shop” doesn’t have a cyber exposure is dangerous. The frequency and severity of breaches is rising, which seems like an expected trend. What isn’t expected is the new breadth of industries affected by the losses. The common misconception is that breach targets are Fortune 500 companies or Government entities, but over the last ten years that’s been disproven. As reported by Property Casualty 360, “62% of cyber breach targets are small to mid-size businesses.” Most insurance brokers aren’t talking about this with their clients.

2. Denial

Loss frequency has increased in most industries by hackers finding new ways of obtaining personal information. As criminals diversify how they tap into a company, they have new targets to gain access; your employees. Targeting employees via malware or phishing attempts multiplies the total exposure of companies that give their employees email addresses or passwords for their servers. You may have top-of-the-line server protection, but without proper training, an employee could make the mistake of opening a malicious email. Criminals have reached the point that they can create an email that looks nearly-identical to a company’s email template opening them the opportunity to get sensitive information from another employee. The long-term solution is generally training, but unfortunately most companies don’t make the investment until well after a breach.

3. Undervaluing

It’s a daunting proposition to take all the correct steps in reacting and responding in the event of an attack. Aside from breach prevention, the real bulk of cyber liability cost comes after the claim. There are mitigation expenses and laws regarding when you report the crime that could result in extra fines if not done correctly or timely. So how do you gauge the real cost of all of this?

We recommend that every client uses a Data Breach Calculator. The results never fail to surprise. One of the more detailed calculators can be found here: Vitrium Data Breach Calculator

The estimated cost of a breach is immensely important when we go to market for a company’s cyber policies, primarily because a cyber policy shouldn’t be based off price, but should instead be tailored to what losses the client would need help mitigating in the event of a loss.

What’s the solution?

Because of current carrier appetites, it’s incredibly easy to find a competitively-priced, personalized policy. Most traditional cyber policies already cover customer loss, business disruption, regulatory fines, and other liability coverages, but now you can go a step further. Working with specialized underwriting groups gives us access to incident investigation and other mitigation strategies that drive costs down under a loss. Insurance carriers have developed these products to protect their policyholders, which is where we come in as an insurance agency. We share these trends because it’s one piece of our comprehensive plan to keep our clients prepared for the worst, but informed enough to hope for the best.


About the author

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Diego Rivera is a Sales Executive at Bouchard Insurance. Diego specializes in Property & Casualty, Workers’ Compensation, and Health Benefits for large commercial accounts. | Connect on LinkedIn

Individual Mandate Update & Potential Impact on Employers

As a recap- the individual mandate went into effect in 2012 when the Affordable Care Act (ACA) first launched, requiring all individuals to carry some form of health insurance, or, pay a penalty fine when filing taxes for the prior year with no coverage. The penalty started at $95 or 1% of household income (greater of the two) and increased each year, leaping to the 2017 penalty of $695 or 2.5% of household income.

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Proactive employers prepared for a certain percentage of uninsured employees to join their health plan over the last 5 years as the penalty increased and ensured they budgeted appropriately for the spike in employee enrollment. With the recent announcement of the elimination of the individual mandate for the 2018 tax year and beyond, should employers plan to have that same percentage who joined their health plan drop off? It’s possible. This is something employers should remain aware of, as they could see a decrease in enrollment as a result of this change in the law. So, if fewer employees enroll in the health plan it would likely mean a smaller employer spend. This would be a good thing for employers, right? Wrong.

Those individuals who choose to go uninsured are likely the ones who do not need, or use, the health insurance system, i.e. the healthiest of your employee population. Who will choose to remain covered on your employer sponsored health insurance plan? You guessed it, it’s likely those who are unhealthy who will remain on the plan and incur claims. The change in the Individual mandate could lead to a decrease in employee enrollment, less premium dollars, and increased claims, causing medical loss ratios to sky rocket due to this unbalanced ratio and overall employer premiums to rise. As the Employer Mandate is not going away, the affordability portion of ACA will continue to limit the amount of employee dollars that can be received towards the overall plan premium.

Although you may not anticipate huge fluctuation in enrollment as a result of this change in law, consider shifting to a more consumer driven plan such as a Health Savings Account tied to a High Deductible Health Plan (HSA/HDHP), or a Health Reimbursement Account (HRA), if you don’t already have this plan structure in place. This may be a way to shift some responsibility to your employees and allow them the opportunity to be better consumers of the healthcare system. Always good to plan for the future!


ABOUT THE AUTHOR

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Candace Conforte is a Sales Executive at Bouchard Insurance. Candace specializes in Property & Casualty, Workers’ Compensation, and Health Benefits for large commercial accounts | Connect on LinkedIn