While Facebook can be a very useful tool for sharing photos, updating your status, and catching up with long lost friends; an errant post could lead to legal action. Consider the actions of a Melbourne Australia woman who thought she was warning people about a child predator taking photos of children at the Westfield Knox Target. The woman (who wishes to remain anonymous) took a photo of a many and shamed him on Facebook; calling him a ‘creep’.
Subsequently, the Facebook was shared over 20,000 times. In fact, woman even called the police to notify them of a child predator. However, the man, and father of three, had a perfectly honest explanation for his actions. After one of his friends told him that his picture was being shared on Facebook, he went to the local police to clear his name and explain his actions. That’s not the end of the story.
After finding out that she made a mistake, the woman removed the post and attempted to contact the man and ask for forgiveness. Too late lady! By that time, the man had already begun receiving death threats for his “activities”. Now, the woman that shared the post is also receiving death threats for her mistake.
The insurance perspective?
In this case, the woman could face civil litigation for her actions. While trying to do her civic duty, the woman could face a lawsuit for libel. Many umbrella policies provide protection against libel and slander accusations. Have you ever posted something in error?
Consider the following definitions:
li·bel – a published false statement that is damaging to a person’s reputation; a written defamation.
2. (in admiralty and ecclesiastical law) bring a suit against (someone).
Since the woman’s post caused damage to the man’s reputation, she could face future legal challenges. The unnamed Star Wars fan has a good case against the woman. Even though she’s attempted to contact him numerous times and offer an apology, death threats and 20,000 shares on Facebook may do irreparable harm to his image.
Hopefully, this woman has a good home insurance and umbrella policy to protect her in case of the possible legal charges she’s about to face. This should serve as a reminder before you share your next Facebook post. Get your facts straight before you post, share, tweet or re-tweet. Also check your homeowners insurance and your umbrella policy. If you make the same mistake, and your policy doesn’t cover libel or slander, your next post could cost you millions!
Dallas is booming if you have an affinity for the construction business. Insurance requirements have a way spoiling the mood for small business owners. When it comes to construction trade contractors, it’s much worse. Most construction trades purchase general liability insurance policies expecting that to be enough to complete a job and get paid. As construction exposures continue to increase in complexity, contractor insurance now require more complex endorsements and policy changes to match.
What does a smart small business person do to combat ever increasing coverage complexities? Not be trite, but knowledge is power. So, I’ve come up with a few tips to help you understand what to look for when you’re negotiating a deal. This article will help you sign up with more contractors and get paid for the work you do. If you understand the insurance pitfalls, you can get more jobs, and make more money. If you’re like most small contractors, more money is a good thing. So read on.
General liability is a good start
Remember the Oldsmobile slogan, “It’s not your father’s Oldsmobile”? Consider that the slogan for today’s insurance requirements. “It’s not your father’s general liability”. In the past, you could simply provide your liability certificate of insurance and move on right? While obtaining liability might be a good start for most small businesses, for many this policy type is only a starting point. If you expect to perform recurring services, you can expect your contractor to add them as additional insured by way of policy endorsement.
Aside from the additional insured policy, we’re seeing other endorsements including waivers of subrogation, primary and contributory endorsements, and several others. Ultimately, The addition of these endorsements to your liability are important in several key ways including:
Special endorsements must come from the insurance carrier.
Contractors can contractually withhold payment for failing to meet requirements.
These endorsements quite often lead to increased insurance costs.
While General Liability is a good start for you business, always review your contract’s insurance requirements to ensure you have the right additions to your general liability policy.
Consider commercial auto insurance for job site driving exposures.
While most small subcontractors starting out attempt operate business with liability, many businesses now require their trade contractors to carry general liability and commercial auto liability. We’ve noticed an increased number of construction management, general contractors, and property management companies require either personal auto liability limits or commercial auto liability with combined single limits of $1,000,000 or more.
If you’re like most small trades, you’re probably thinking, “Why do I need commercial auto liability?” The truth is our society has become complex enough that one could be sued for a slip and fall in a parking lot. As a result, larger companies want to ensure that all contractors working for them have a standardized minimum amount of coverage; just in case. Aside from increasing contractual requirements, commercial auto policies extend liability to employees and vehicles whether your business owns the vehicles or not. On a personal policy, if an employee or contractor has an accident your vehicle, it is not covered. Imagine this happening on a job site. I’ll let you fill in the blanks. Besides, all the contracts that pay money require some sort of business auto liability.
Tax status has nothing to do with Workers Compensation
When it comes to workers compensation, the common mistake small businesses make is to not consider 1099 contractors as employees. In Texas, because the state does not mandate workers compensation, many small businesses ignore this coverage all together. With many construction trades, this is a recipe for disaster. So, with workers comp, consider the following before you consider omitting this from your insurance portfolio
You’re still liability for job-related injuries
If a subcontractor has an injury on your job site or under your contract, you are liability. While they are working for you, a court would consider them to be your employee. The fact that chose not to pay payroll taxes is a matter of contract and tax law. It has nothing to do with financial responsibility.
Make sure someone gets it workers comp
If you decide that your business is too small to obtain workers compensation, make sure that all subcontractors obtain workers compensation and provide copies of their insurance certificate. Not only does this send a strong message, but it also ensures the guys on your job site have the necessary protections in place in case of injury. If you are the subcontractor, consider getting workers compensation. An injury could close your business’ doors for good.
Review your contract before pricing your product or service
While it may seem to be a hassle, reading job contracts is one of the most important things you can do as a small business owner. Signing a contractor prior to reading it could make difference between making and losing money; just because of the insurance requirements. Also, it could make the difference between getting paid and being placed on vendor hold due to insufficient insurance requirements.
Have your insurance agent review your contract
We suggest our clients send us a copy of any contract that has insurance requirements. This gives us the opportunity to review the contract for unnecessary insurance coverage endorsements. We also have the opportunity to discuss any added exposures due to the type of work being completed. In the end, if the insurance goes awry, at least you can blame your agent and call him to make it right.
Everybody is doing it
For example, a large number of national home builders require subcontractors to add them as additional insured for completed and ongoing operations. In this case, the subcontractor’s coverage provides coverage for the contractor after the product is completed and job is done. What about the spray wash guy or the person that fills in a cracked tub? These types of businesses are service related. As a result, the completed operations endorsement would be a bit unnecessary since a concrete power washer is simply servicing the finished concrete.
The previous example is one of many examples we witness when dealing with small construction insurance requirements. The key is to catch them and address them before you start work. The last thing we want to do is perform work and not get paid; right!
To Sum it all up
There you have it. 4 things tips for trade contractors that will make your insurance life much easier.
Start with General Liability and expect more requirements
If you drive to a job-site, you and your employees or subcontractors may need commercial auto
Consider workers compensation for your employees or subcontractors; tax status does not matter.
Review insurance requirements in every contract with your insurance agent
Have questions, contact my office at 214-717-4326 or comment below! We’re ready to assist you and answer your questions.
If you’re like most trucking and transportation company owners, how do you compete with the big guys? Let’s face it, the longer you keep your drivers, the better your company runs. Studies show that over 80% of drivers leave their carriers primarily due to benefits or the lack thereof. As a small fleet owner, what can you do to provide big company benefits with a small company budget?
We have found a few insurance related solutions that can help you attract and retain your drivers without breaking your bank. The key to solving your health and retirement benefit problems lies in your buying power. Larger companies can afford to administer their benefits because of their sheer size. Would the following products help your company?
Guaranteed Acceptance Whole Life Insurance
Critical Illness Insurance
Getting health coverage is Simpler than you could imagine
With your personal benefits coordinator, we can help you tailor plans for each of your drivers. We can help your company devise ways to help your drivers meet the requirements of the affordable care act and its tax implications. You have the choice of funding a benefit bank, health marketplace SHOP, individual major medical, minimum essential coverage. The best part is that each driver can tailor their own coverage.
We’ve partnered with the Independent Truckers Group to help provide you with these and other coverages to help you with your employees and independent owner-operators. Contact us at 214-714-4326 to schedule a meeting with a licensed insurance benefits account manager.
Drivers that are looking to get started delivering for Amazon Prime have to meet their requirements. In checking their website, Amazon requires that all delivery companies meet the following basic requirements:
As a company owner or owner-operator, you and your company are required to have a written safety program that includes your policies, procedures, and training for your drivers.
While I have noticed that Amazon has small vehicles delivering for them, their site suggests vehicles with at least 200 cubic feet of volume. With those types of measurements, you could be looking at something along the size of a cargo van or larger. The size of the vehicle could lead to other considerations regarding state and federal regulations.
As far as insurance requirements, Amazon’s requirements are very similar to a number of logistic companies. Amazon’s basic insurance requirements include the following:
Commercial General Liability of $1,000,000 per occurrence / $2,000,000 aggregate
Workers Compensation – $1,000,000 limit
Business or Commercial Auto Liability – $1,000,000 combined single limit
Cargo Liability $25,000 (or higher, may need reefer coverage for Amazon Fresh)
Keep in mind that these are Amazon’s national delivery requirements. Requirements could differ in the state of Texas. It is possible that Amazon may allow workers compensation waivers for individual owner operators. As an insurance agent, I suggest carefully considering waiving workers compensation especially if you have plans to grow your business in Texas. Waiving their requirements does no waive your liability under the law in case a driver is injured in the course of delivering packages. Who’s responsible for gaps in coverages?
As a business owner, you are responsible for any driver injured on the site. Amazon’s requirements only account for their liability exposure. Since business owners are probably classified as a independent contractors, you should probably consider the following coverages:
Physical Damage Liability
Health and Supplemental Insurance
Physical damage liability can be added to most commercial auto policies for vehicles under 54,000 lb gvw. For health, life, and retirement benefits, consider discussing these benefits unless you think you can work as a delivery driver forever. We are fortunate enough to have plans that address the coverage needs of today’s delivery and transportation companies. These plans start around $75 to $100 per week.
Aside from insurance coverage considerations, I previously mentioned the possibility of state and federal regulatory needs. If your vehicle ultimately is required to get a USDOT number and MC number or TXDMV number (formerly TXDOT number), then you may fall under federal motor carrier regulation. I contacted Amazon and will update this blog post if they change their insurance or other regulatory requirements.
I see you’ve requested more information about becoming an insurance. If you’re wondering what’s next, this article is for you. I’ve broken it down into 3 large steps. So read along. I promise you this will point you in the right direction. If you have questions, post your questions and comments below. I’ll answer.
Trouble deciding your next move? You’re not alone. The Insurance industry presents lots of paths.
STEP 1 - CHOOSE YOUR PATH
Step 1 – Decide what you want to sell first.
This step should be easy. New agents tend to want to cast a wide net. It pays to specialize and do something well. The two general areas of insurance specialization. Those areas are:
Property and Casualty Insurance. This type of insurance includes auto, homeowners, and business insurance. Most successful property and casualty agents specialize in either personal lines or commercial lines. For agencies, these policies pay 10-15% commission annually. Expect to make $100 to $200 per year on each personal policy you write.
Life and Health Insurance. This type of insurance includes life, health, senior health insurance, final expense and others. The most success life and health agents specialize in a specific niche product. Commissions vary, but life insurance policies generally pay higher up front commissions while health insurance policies pay on an ongoing basis.
The key in this step is to learn a specialty and get good at it. Whether you’re going to sell auto insurance or health insurance, get your license and focus.
Step 1– Action Item: Decide what type of insurance you want to sell first; property/casualty or life/health products.
Step 2 - Licensing Education
Choose a pre-licensing education course
Classroom or online prep course; which do you prefer? In many states pre-licensing education is required. In Texas, if you can pass the test you can get your license. With that said, I suggest completing a prelicensing education course; either online or in-person. The job of your prelicensing education provider is to equip you with the tools needed to pass your licensing course. In this step, focus on learning what it takes to pass your licensing exam. Once you pass your exam, and get a job or start your agency, we can focus on learning the insurance business. For now… just pass the exam.
If you’re like all successful agents, follow the systems that countless agents have followed. Choose a classroom or online licensing provider to help you pass your exam.
Now that you’ve completed your pre-licensing course, you need to contact Pearson Vue to schedule your insurance exam. Don’t worry, you’re not being tested on your understanding of basic programming or the operation of a Commodore 64. However, you will need to make a 70% or better or your chosen licensing exam. Aside from passing your licensing exam, you’ll need to complete your fingerprints and an online application. Normally, it takes approximately 3 to 4 weeks to process your process your licensing application.
Now that you’ve completed steps 1 – 3, you should be in a position to apply for your insurance license. In this step, you have the option of completing a paper application or online application. To complete a paper application, you’ll need to use the Texas Department of Insurance’s licensing application. However, it is more common to complete the online licensing application here.
After your complete your licensing application and your license is posted online, you’re all set. Time to start covering people and protection people financially, and all that cool stuff.
Inevitably, not all insurance policies remain in force for the entire policy period. Let’s face it, insurance policies are cancelled early by the consumer for all sorts of reasons. Due to economic conditions, a small business could be forced to close its doors. An individual family could find a cheaper alternative to an existing auto or home policy. Whatever your reason for cancelling a policy here are a few tips to ensure your voluntary cancellation is in your best interest.
Never cancel an insurance policy when you still need policy
Cancelling a policy while the need still exists can be very dangerous; especially for auto policies. Recently, we had a new client call and ask to remove a child’s vehicle from the policy. However, this vehicle titled in dad’s name. We asked if his daughter obtained insurance and whether he could prove the existence of a replacement policy. Once he stated he could provide proof of new coverage for his daughter’s car, we processed the removal of the extra vehicle and documented the details of the call in our system.
This can also happen in the case of divorce-separations. Once a divorce is finalized, the first named insured may request to removal of a spouse. In cases like these, insurance requires the agent (with good reason) to obtain some type of documentation confirming that we’ve spoken to both parties. In this case we must either write the former spouse a new policy or confirm the existence of insurance coverage elsewhere.
In both cases, this prevents us from pulling the proverbial rug from underneath a client. If the spouse being removed has neglected purchasing a replacement policy, removing them prematurely could cause an unnecessary gap in coverage. What would happen if that spouse had an accident? In the case of the daughter, if dad still has a car titled in his name, he could still be considered liability if a car titled in his name is improperly covered or uninsured. What would happen if this case?
Make sure replacement policies cover the same exposures
Many times, consumers look a lower rates only. As a result, as a result, some companies or agents will provide lower rates by reducing or removing coverage on auto and home policies. As a result, the reduction of premium could open exposures to loss that one had not consider. This can also be very costly.
Imagine having an auto insurance policy that has everything you could possibly ask for. Imagine having a policy with high liability limits, personal injury protection, uninsured motorists, physical damage for the car, towing, rental reimbursement, death and indemnity coverages included. After having this policy, you see a commercial for “no-credit check insurance policy” that will save your $30 per month. In purchasing that policy, you’re convinced that you only need state minimum liability and physical damage coverage with a $500 deductible.
After switching policies, you have an accident in which you’re severely injured. Aside from missing time from work, you’re left with paying your deductibles for both auto insurance, and health insurance while living on less money due to unpaid sick or lost business time. In this case, was $30 per month or $360 per year worth removing the personal injury protection? What if this was a claim with an uninsured driver. Was it worth the lost uninsured motorist bodily injury coverage? After a claim is the worst time to find out that you purchased a worthless policy.
Policy and agency fees are generally non-refundable.
If the insurance company charges you a fee and you cancel before the end of a policy period, you will not get the fees back. That includes my agency as well. This is especially important when it comes to business policies. As an insurance agent, I am very careful in charging fees. I understand that there are a number of people that would love to do business with you. So, we only charge fees when it is absolutely necessary.
We charge fees for specialty cases that require a high deal of special handling or manual processing. Since the insurance agency has to refund commissions to the insurance company if your policy cancels for any reason, we charge fees to offset early cancellations on specialty policies. This helps ensure that we remain profitable in our agency.
You may be required to provide other documentation or signatures.
Our insurance providers require a signed cancellation letter on all early cancellations. In personal auto and home insurance, we also require a copy of the replacement declarations on filed along with the signed cancellation letter. This ensures that we help prevent causing an unnecessary gap in insurance coverage.
Some policies have portions which are non-refundable. (Minimum earned requirement)
Because some commercial insurance policies require that we apply for coverage in residual (high risk/surplus) markets, we come across strange policy requirements. For business policies, we see a 25% minimum earned requirement. This means even if your policy one day after your policy starts, you are still liability for 25% of the policy’s annual premium along with any fees associated with the policy.
Policies with regulatory filings may have different cancellation requirements.
One thing that makes it difficult to cancel a policy is the presence of state or federal filings. This is most common with transportation (trucking) policies which require Form E filings. Even if you stop paying for a transportation policy, having filings requires the insurance company to cover you for an additional 30 days or so. As a result, you continue to incur charges that can be sent to a collections department.
In cases like these, in order to immediately cancel a transportation policy, you will have to completely shutdown your business and provide that proof along with a signed cancellation letter for the insurance company to cancel your insurance policy.
Cancelling insurance is serious business
In the end, cancelling an insurance policy is serious business. We understand that stuff happens. If you have to cancel a policy, make sure that you’re doing for all the right reasons. When replacing a policy, make you understand the differences in coverage. If you’re a business, keep in mind that there may be other requirements prior to completing your cancellation request. In all cases, understand we will require details regarding your new insurance along with a signed statement requesting your cancellation.
I’ve had lots of people ask me questions and send emails regarding becoming a new insurance agent. In fact, we’ve interacted with so many people in the state of Texas that we don’t have time to respond to all of you. As a result, my fellow agents and I thought it would be a good idea to start a VLOG just for the office.
Following our YouTube log will give you insight into the ins and outs of the daily job of a real insurance agency. In fact, you’ll see the decision making processes that go into presenting a rate to a client. You’ll also witness our frustrations when we find out that a client was less than forthcoming about their driving records. You’ll even get a chance to us get excited to sell another policy and make our clients happy.
Before you become an insurance agent
Before you become an insurance agent, you have to decide where you fit. For most, an insurance agent’s career can be divided into two different categories, Property Casualty and Life Health. Each has its pros and cons. The key is the agent running the show or the appointments.
Property Casualty Agents
P&C agents generally catch people shopping for auto or home insurance and make it easier for you the agent to prospect for these types of clients. When you find someone shopping for insurance, you quote them against your company (or companies), make sure your client is not missing coverages, and then ask for the sale.
P&C agent new business and renewal commissions generally start at 10% to 15% based on your contract with the company or the agency. If you’re a new agent, you will probably have to split your commission with the agency owner. The good part about the P&C world is that commissions are level. On the other hand, because auto and home insurance annual premiums range between $1000 – $2000 per year, the average commission ranges between $100 and $200 per policy. As a result it can longer to ramp up to a good salary level.
Life and Health Agents
If you decide to go down the path of the life & health agent, you may have to work a little harder. The reality is that people do not like talking about their health or the eventual demise. As a result, life and health insurance has to be heavily marketed. With the exception of open enrollment for Medicare and Obamacare, most life and health insurance sales require you to be well educated and prepared to convince a client of the importance of getting covered.
On the other and , life insurance pays some of the highest first year commissions of all products sold. It’s common for an agent to make 70% to 80% of first year premiums paid. Look at it this way. If you sell a $1000 life insurance policy, the insurance company could pay you as much a $800 or more. This is perhaps the number 1 reason people get into selling life insurance. Not only does the life insurance policy pay high first year commissions but there’s enough room on the commission ladder to recruit other agents.
If you’re newly licensed, that where you need to start. Decide if you have what it takes to sell life & health insurance or do you want the routine of auto and home insurance. That makes a hug difference. Do you have questions about the insurance world? I’d please comment below and I’ll do my best to respond to each of your questions either here or on our YouTube channel.
Please subscribe to our YouTube channel. Feel free to add comments and we’ll do our best to respond to them. Thanks for visiting us and we hope we can help you grow in the insurance world.
As an insurance agent, a primary part of my job is to compare coverage between different insurance companies and policies. As a result, it can get quite hairy when a client asks me to beat a rate they received from another insurance agent. With all the coverage combinations, and home policy types available to today’s insurance consumer, the lowest rate can get you in trouble. In most cases, it doesn’t make sense to choose the lowest rated home insurance policy. To help you, I’ve come up with the following items to help you avoid getting cheap rates that ultimately cover nothing.
Actual Cash Value Policies – Dwelling policies
With all the different insurance policies available, the cheapest policy sold is generally the Dwelling fire policy. This policy was designed to provide basic financial protection for homeowners and landlords. Generally, agents write this policy on older homes and properties that do not qualify for traditional home insurance policies. In the case of the dwelling fire policy, these basic policies are generally written to protect the home against catastrophic total loss due to a covered peril. While that sounds ideal if you’re looking for the cheapest home insurance policy, the downsides may outweigh the cheap upside.
One major downside of dwelling fire policies is that they are generally coinsurance policies. In short, this means you won’t be filing any partial claims for roof replacement or broken trees. Another downside to dwelling policies is that many of them have little or no liability coverage. Unlike their more expense counterpart, if your neighbor’s kid slips and breaks a leg on your premises, you could be held liability for the child’s doctor bills. Another gaping hole in the coverage provided by the Dwelling fire policy is the lack of content coverage. Imagine having a fire, losing all your personal belongings and then finding out that your policy was written to a level that only pays off the mortgage company. Long story short, if you plan to live in your home, try avoiding a dwelling policy.
Foundation Water Damage Protection
I always say that there are two types of homes in Texas; those with foundation problems, and those with repaired foundation problems. The housing shortage in north Texas only makes things hairier. Imagine purchasing a newly remodeled home only to find that you have a water leak underneath your home’s foundation. In talking to the leak expert, you find the only way to repair the leak is to pay thousands of dollars to access, diagnose, and repair that leak. Is this covered under your home insurance policy?
This is another case in which choosing the cheapest policy is not the best course of action. For additional bucks each year, many insurance companies offer some type of foundation coverage which gives you access to the plumbing leak. While the insurance company does not pay for the actual damaged pipe, the cost to access a slab leak usually exceeds the cost of repair the damaged section of pipe. With the number of homes with foundation problems, it is probably a wise course of action to ensure your get this coverage.
Slow and Continuous Leak or Sudden and Accidental Water damage coverage
Aside from slab leaks and water backups, Texas home policies can be a bit confusing when determining the level of water protection. While most Texas homeowners insurance policies will cover damage resulting from a broken hot water heater, dishwasher, or toilet, coverage resulting from slow and continuous leaks could cause a problem.
Not all policies have the option of both types of water damage. In the case of covering slow leaks in Texas, each company has a different method of covering the resulting damage. Some companies will cover a slow leak only if you report the leak within 14 days of the occurrence. Other companies will cover damage resulting from a slow leak regardless. The takeaway here is simple. Ask your agent if the policy provides coverage for water damage. If he (or she) cannot answer that question, then it’s probably time to find another agent and policy type.
All home policies are different
Since there are so many differences between policies, does it make sense to revert to the cheapest one? Now that you’ve looked at this article, do you have questions about your home insurance policy? That last thing you want to do is purchase a useless policy. The only way you know that is after a claim. Did you purchase the cheapest policy when you purchased your home insurance? Give us a shout and let us take a look.
If you’re looking for where to go for your 2015 senior health insurance compliance training, look no further. I’ve compiled the following list for your convenience. If you think that we’ve missed something, let me know. I’ll get it added right away.