Tis the Season for Oktoberfest

Tis the season for leaves changing colors, cool brisk evenings, scary costumes, pumpkin carving contests and OKTOBERFEST!  I have to admit, I'm not a beer drinker.  But, many, many of you out there are.  And judging from how many people attended Campbell's Oktoberfest festival this year, there are NO shortage of people drinking and loving their beer. 


Let's say you are one of the vendor's at an Oktoberfest festival or event.  How do protect your business from the typical mishaps that occur at a festival?  Can't think of any examples on how your business would be at risk for a pesky two day festival?  Here are a few of the top claims that occur from these events:

1.) WEATHER - We can't control it and sometimes, it doesn't cooperate.  You can control this financial risk by getting weather insurance for an event.  Whether it's snow, rain, adverse weather, wind, event cancellation, these types of perils are all insurable.  If you were a food vendor and purchased thousands of sausages for an Oktoberfest event only to find out that the event was cancelled....how would you recoup your cost?  Because let's be honest, where else are you going to need thousands of sausages?

2.) LIQUOR CLAIMS - The vendors serving beer can control how much a festival attendee drinks on site.  But the unfortunate thing is, most eager festival attendees pre-party.  And vendors that are serving alcohol typically don't know how much they've had prior to coming to the event.  If a person at the event gets in a fight, breaks a stores window, or drives off and gets in an accident, the person who served the patron could be sued for the damages.  Make sure that your business is covered by purchasing Liquor Liability if you are in the business of serving alcohol to event goers.  If you are not a bar, tavern, liquor store, etc., you still have an exposure if liquor is being served on your site.  In order to properly protect your business, purchase host liquor liability, a type of policy tailored to someone who is not in the business of alcohol sales, production, or service, but who needs liability coverage for hosting the event.  Liquor liability is normally excluded on all general liability policies unless requested to be included by your agent.

3.) SLIP AND FALLS - This is one of the most typical claim that pops up at events.  Someone trips over uneven payment or a curb...or an extension cord that is helping power one of the vendors stands.  If you are hosting the event, make sure a solid safety procedure is in place for events such as Oktoberfest.  All vendors should be required to sign off on a safety manual prior to setting up shop.  Everything from security, to sanitation, to crowd management, to first aid protocol should be covered in this document.  Whether you have EMS services on stand-by, have a standing first aid station, or both, make sure vendors know who to call or what to do if someone trips and falls or an unfortunate emergency occurs.

4.) VANDALISM - Anyone remember an old cheer?  Let's get a little bit rowdy, R-O-W-D-Y!  This is exactly what happens when you cram a bunch of people drinking alcoholic beverages into a roped off concrete street.   Sounds like fun, right?!  Not if you're a local store that gets it's window broken by a few rowdy festival goers.  If you're a local business owner and know a festival is coming up in the near future, it may be smart to double check your insurance policy to confirm what your glass deductible is let alone your property/general liability deductible.  Secondly, look around the store, do a quick estimated value total for all property in the store and check that against what your business personal property limit is on your current policy.  Most business owners don't have time to update their policies every year so making sure that limit is adequate saves a lot of headaches down the road. 

In short, it pays to be prepared.  Don't gamble on a two day festival by not protecting your business properly.  If your current general liability policies doesn't cover specific events, such as an Oktoberfest, secure event insurance.  It's cheap, easy to obtain and protects against most, if not all of the perils, listed above!  Happy Oktoberfest month!

The Rising Cost of Insurance and How to Cope

There is no denying that insurance costs across the board are beginning to rise.  For the past five years insurance costs kept on diving and diving, dipping lower and lower than I have ever seen before in the marketplace.  Insurance carriers were writing risks at alarmingly low rates that I knew would not be able to be sustained.  One of my previous bosses used to call those carriers "the flavor of the month".  And boy was he right.



Now fast forward to this year.  Carriers are beginning to tighten up their reigns and become more
strict on what they will accept and what they will decline.  Minimum premiums are beginning to rise again and you most likely are seeing more carrier declination's from your broker than quotes.  Some carriers that flourished during these tough times are at "capacity" and not writing any new business.  Ahhhh, the flavor of the month.   In turn, some of my clients are having to now scramble, move carriers yet again and take a substantial premium increase due to choosing those insurance carriers.

A few things to note during these times.

1. It pays to stick with an insurance company that is established and not premature to the marketplace.  Your premiums may be a bit higher than the "flavor of the month" insurance carrier.  But if you can afford the few extra dollars, stick with the more secure, proven carrier.  You will save money in the long run.
   
   
2. Check up on your insurance carrier.  Go to AMBest and look at your insurance carrier's rating, if it is not on your quote that the insurance broker provided.  Typically, anything under A- VII you should avoid as their financial situation may be a little shaky.
   
   
3. Don't be afraid to ask your broker to market your insurance renewal out.  This is their job!  Specifically request a marketing summary of insurance carriers and their responses upon renewal.  This not only helps avoid assumptions that your broker didn't do his or her job, but it also keeps you in tune with what the insurance marketplace is doing.  Are insurance carriers quoting high premiums or are they even quoting at all?  Or are there only a few carriers that will entertain your type of business?  Market, market, market your insurance renewal.  Knowledge is power.
   
   
4. In 2013 and 2014 I would suggest paying close attention to your workers compensation and professional liability lines of insurance.  These are the two lines of insurance that I have seen get hit the hardest in the past year.  Workers compensation rates are rising rapidly and professional liability premiums and deductibles are fluctuating swiftly from carrier to carrier.

The good news is that the even though the flavor of the month's are beginning to be plucked from the pack, the insurance carriers that are remaining will continue to be reliable and successful which should be of comfort to you and your company.  Knowing that your insurance carrier will be there through tough claim situations is what you really want and need.  

If times are hard and you can't afford to stick with Mr. Reliable Insurance Carrier and are forced to go with the Flavor of the Month Insurance Carrier...it's OK.  But just try and get back to that reliable carrier as soon as you're able to.  Your pocketbook will thank you!

Building Trust With Clients Amidst Insurance Scams

Yesterday I had an appointment with a client that has been with me for years.  Halfway through our annual renewal meeting, the CEO told me a horror story about how after twenty years with his personal lines broker, he decided to shop around.  He received a mailer from what seemed to be a legit operation.  He even went to the insurance broker's office.  Everything seemed to check out just fine.

My client did all the right things.  He even consulted with his current agent on the quote the other agent had provided.
His agent of twenty years couldn't come close to the other agents rates and my client ended up going with the new, unknown agent.  Now fast forward three months.  My client could no longer get a hold of the agent and hadn't received his policies.  My client knew something was wrong, filed a complaint with the Department of Insurance and found out that this guy had been scamming many people in the same area.  The twenty year veteran agent took my client back with open arms.  In my meeting with my client he vowed never to leave his personal lines agent because you can't put a price on "trust and honesty".  

And then it hit me, how do I continue to build trust among my clients and prospects when our industry is riddled with scams?  It's always disheartening knowing that opportunists and criminals step up their scamming games after a natural disaster or catastrophe.  They kick people when they're down and in turn, the legitimate, hard working, trustworthy brokers and agents end up getting rolled into this bad wrap.   

A few disciplined practices have given me a leg up on fraudulent insurance brokers.  Here are a few that I find are most important to my clients:

1. BE RESPONSIVE.  Put yourself in your clients shoes.  If you didn't receive a call back from a trusted advisor or consultant within 24-48 hours, would your trust begin to waiver?  Even if I don't have an answer for one of my clients, I still respond and acknowledge I received their message.  Once I look into the issue for my client, I always try and give them a timeline of when this should be resolved by or when we should be receiving the answer.
2. BE PREPARED.  When a client calls for a meeting or asks if you have time to chat in the afternoon, be inquisitive.  Finding out a little more information goes a long way.  It shows my clients that I care about their needs when I prepare ahead of time and answer most if not all of their questions.
3. BE DEPENDABLE.  In short, do what you say you're going to do.  If you say you will call or get an issue taken care of, do it.  Your client will rest easier and build up rapport with you much faster this way.  

My client was right.  You can't put a price on trust and honesty.  

Happy New Year! 2013 Here We Come!

Wishing all of my readers a very happy and safe New Year's!  

Less Clients, More Service

'Tis the season for being thankful!  And this season I am absolutely thankful for my each and every one of my clients.  They make my day colorful with emails and phone calls.  But the true test is actually being able to be there for a client when accidents or claims do occur.

Late last night I received an email from a client that one
of their properties had been damaged severely from the storm this past weekend.  I was able to respond to them immediately, via my trusty iPhone, and give my client a call first thing this morning to hop on the claim.  In this particular case my client owns an entire block of town homes and there were quite a few town homes that suffered severe water damage due to the storm. Not only was the owner and property manager worried about the damage, but also wanted to put their tenants at ease that this big mess would be taken care of.  

How inconvenient to have to deal with a storm right before the holidays???  Imagine presents, etc., on the floor around the tree that are soaked while you're out running errands.  Not a fun way to come home.  In cases like this, it's my job to make sure things are followed up on and processed accordingly.  I spoke with the owner and the property manager this morning.  I also filed the claim on behalf of the insured to make sure that an adjuster would be assigned to the claim right away.  Now, is it my duty to file the claim on behalf of the insured?  No.  But do I feel better making sure it is filed and being handled properly because of this?  Absolutely.  

Sometimes brokers take the easy way out and redirect insured's to call a 1-800 claims number.  While this may be the most "efficient" way of handling a claim since there is no longer a middle man, it's definitely not the most personal to handle a claim.  Claims are extremely sensitive.  Someone's property is damaged, or in the worst case, someone's injured.  As a broker it's my responsibility to take time out of my day and make sure my clients are O.K.  That is the least I can do when a claim occurs.  If your current broker isn't taking the time to make sure your business is O.K. when a claim occurs, maybe it's time to start thinking about finding someone who has less clients and is more concerned with their clients well-being than their bottom line.

That Will NEVER Happen to My Company!

I can't count how many times I've sat down with C.E.O.'s, V.P.'s and C.F.O.'s for them to tell me that a specific claim instance would never happen to them.  Well, news flash...it has happened to some of my clients!  And no matter how many controls, safety measures and positive company cultures you may boast, it can happen to your company.   Recently we stressed the importance to a company for crime coverage.  The owner was adamant that this would never happen to his company.  He denied the coverage and he is now dealing with over a $350,000 financial loss due to an employee stealing from the company.


As an insurance advisor, it is my job to tell you about all the things that can happen and prepare the business for financial hardship or simple inconvenience in wake of a claim.  Are some instances scary and turn into disasters?  Yes.  Is that every claim?  No.  You definitely don't have to over-insure in every instance.  I am not a fan of spending money carelessly.  But don't go the ignorant route and assume that claims you hear about on television or in the news could never happen to your company.


When I am developing an insurance program for my insured's, one of my client's primary concerns is the deductible or self insured retention amount.  As this should be a concern, some of the less experienced clients tend to associate the deductible, whether high or low, with the premium amount.  The higher the deductible the lower the premium dips.  The lower the deductible, the higher the premium rises.

As a rule of thumb, is this correct?  For the most part yes.  However, what does it mean to take on a bigger deductible vs. a smaller one?  Some business owners only care about the bottom line and never think that anything will ever happen to their business.  These are the businesses that are O.K. with taking a bigger deductible or S.I.R. risk, even if it isn't the smartest thing to do on the books.

My advice is to seriously evaluate financially what your company can afford in case of a claim where a deductible or S.I.R. needs to be paid.  Whether that be a $2,500 deductible or a $50,000 S.I.R., pay attention to these key insurance factors and not just the bottom line.  Is this deductible per claim or per occurrence?  A per claim deductible could mean you are paying out multiple deductibles for one particular event or loss which could add up quickly.

Have more questions or just want a second opinion?  Feel free to email me for aninsurance evaluation for your own business at joileneh@dbinsurance.com.