Certificates Of Insurance
Business transactions frequently require the valuable protection provided by insurance. A Certificate of Insurance is a document that is often requested as proof that adequate insurance exists. A certificate is not the same as a policy and certificates do not affect the coverage provided by a particular insurance policy. Therefore, requests to "endorse the certificate of insurance" are inappropriate and misleading. A certificate is a separate document that is used to comply with a common contract requirement to verify certain types and amounts of insurance.
Certificate holders, the entity or party requiring the certificate, often demand that they appear as "additional insureds." This requires an endorsement (change) to the policy and it gives them coverage for injury or damage resulting from the contract.
Example: Tenant A leases a building from Property Owner B. Property Owner B demands that the tenant changes its insurance policy to also show the property owner as an additional insured. If a tenant’s customer is injured on the premises and sues both the property owner and the tenant, the tenant's liability policy would provide coverage for both parties.
Construction contracts require certain forms of insurance, certain insurance limits, a hold harmless agreement and the inclusion on insurance policies as additional insureds. A "hold harmless" agreement is a contract provision that states how much responsibility each party accepts for damages arising out of the agreement.
A certificate of insurance can confirm that the appropriate policies were issued and that other requirements were also met. It is important to have a system for monitoring receipt of certificates BEFORE any sub-contractors are allowed to begin work. If certificates are not obtained or kept up-to-date, when the contractor’s Workers Compensation and General Liability policies are audited, the payroll for the sub-contractors without Certificates will be included with the contractor's resulting in an additional premium charge.
Ask one of our insurance agents to help determine if you should be obtaining or providing certificates of insurance in conjunction with your business. In addition, when you’re required to provide a Certificate, send your agent a copy of the contract. The contract allows the agent to assist you in determining what liabilities you are accepting and what can be done to modify your insurance program to best protect your financial well-being.
The average yearly auto insurance premium is almost $800, but there is wide variation around this average. Many factors can affect your premium, and they all help determine how likely you are to have an accident. Perhaps surprisingly, many of them do a better job than just your driving record. Not all companies use all of these factors, and some might use factors not listed here. Your premium may depend on, in no particular order:
Think quick. Where's your main water valve shut off?
1. Read your homeowners insurance policy carefully.
Don't wait until disaster strikes to discover what's in your policy — get familiar with it now. Make sure you have "replacement coverage" for your contents instead of "actual cash value." The latter means that your insurance company will deduct depreciation from the overall value of your contents.
2. Save your home improvement receipts.
Home improvements that add to the value of your home, prolong its useful life, or adapt it to new uses — such as building a deck or adding central air — can pay off when it comes time to sell. The federal government allows a single homeowner $250,000 in tax-free home-sale profit (double that amount for married couples), but money spent on capital improvements is subtracted from your profit, reducing the amount you may have to pay. For more information, visit the IRS website.
3. Know where the main valve shutoffs are located.
Keep your house and its inhabitants safe by learning where your main electrical, water, and gas shutoffs are located. Check at the main breaker panel or outside near a service entrance for your main electrical switch. Your main water shutoff is likely located near your furnace or water heater. The gas shutoff is located near the gas meter, which may be inside or outside the house.
4. Inspect your roof regularly.
Experts recommend getting your roof professionally inspected if it's more than 12 years old. In the meantime, you can use binoculars to check for deteriorated flashings or broken shingles. If your roof is basically in good shape, it may be necessary to only replace the damaged or missing shingles. Make sure to keep leaves and other debris off the roof — water can get in through your shingles and ultimately to your ceilings.
5. Look for leaks.
Check periodically for water leaks and repair them as soon as possible. The longer you ignore a leak, the more expensive it can become to fix. One way to tell if you have a leak is to turn off all faucets and water-using appliances. Remove the water meter box and see if the flow indicator is moving. If it is, you may have a leak.
6. Don't neglect your gutters.
Plugged up gutters are disasters waiting to happen. Gutters and downspouts need to be debris-free so they can function properly, diverting water away from the house and basement. Most experts recommend cleaning your gutters no less than twice a year. If you don't feel comfortable doing this yourself, hire a professional.
7. Know your neighbors.
They're good for more than an occasional cup of sugar. Neighbors can keep an eye on your house, hold onto a spare key or even help you out in an emergency. And chances are their homes were built around the same time as yours. Pay attention to their house repairs and issues, and you'll be better prepared for what you might soon encounter.
8. Weatherproof your house.
A drafty house can be uncomfortable and expensive. Take the time to seal air leaks by caulking and weather stripping your doors and caulking around your windows. Not only will it save you money in reduced utilities bills, it will make you aware of any potential door and window repairs or replacements.
9. When it comes to finding the right contractor, take your time.
Save yourself a possible headache and do your homework. Ask friends, neighbors, and colleagues for recommendations. Reading anonymous online reviews is a good start, but also check out www.angieslist.com (membership starts at about $15 per month) or call the Better Business Bureau. Get three estimates in writing, and make sure to include a three-day cancellation clause in the contract. Avoid advance payments — you should pay only for work that has been completed.
10. Be careful where you store hazardous products.
Don't store flammables near a furnace, water heater or boiler. Instead, store them in a cool, dry place, preferably on a different shelf from non-hazardous chemicals. Remember to never remove product labels, as they identify the substance and contain important emergency treatment information.
Insurance Smart Things to consider before starting a business
Make sure you understand how your state defines “employee” as it relates to workers’ compensation insurance and what coverage you may be required to carry.
Before you begin a new “sharing economy” business, make sure you understand all the legal and regulatory requirements. For insurance purposes, once you begin earning income from renting out personal property, you may be considered a home-based business.
If you’re considering a business partnership, look into Key Person life insurance – coverage that makes each partner the other’s death beneficiary – before you form the company. Doing so early helps mitigate risk.
If your business owns or leases a vehicle, make sure the business name is listed on the policy as the principal insured.
If you use your personal vehicle to conduct business, consider increasing your liability limits.
Premiums likely will be higher, but having additional coverage to protect business assets will be beneficial in the event of an accident-related lawsuit.
If you lease space, do not rely on your landlord to provide coverage for your business property.
The building typically is insured only for the basic structure and common areas.
If you purchase business interruption coverage – insurance to cover expenses in the event of a business shutdown – make sure you have sufficient funds to tide you over for the first few days.
Interruption coverage typically does not kick in for a specified time period after a disruption occurs.
Educate yourself about the safety history of your industry. The risk assigned to a business for general liability coverage is impacted by the number of claims filed within that industry or the probability of a claim for a similar company.
Be sure your group health coverage fits your team. For example, if most employees are planning children soon, pregnancy-related coverage will be important.
Businesses with fewer than 25 employees who purchase group health insurance through Small Business Health Options Program (SHOP) marketplaces may be eligible for tax credits.
To save money and simplify paperwork, consider purchasing group insurance in packages, i.e., health, disability, vehicle, etc., from the same provider.
Is Your Car Worth Less Than Your Loan?
Currently, car loans may last as long as four to six years and leases are becoming more expensive. Whether your vehicle is a coupe, sedan, van, sports utility vehicle, hybrid, or truck, your vehicle’s value will depreciate very quickly. A rapid loss of actual value accompanied by a longer loan obligation spells trouble.
It isn’t unusual for the amount of the unpaid loan and lease balance to become much larger than the vehicle's value. This disparity exists over much of the loan or lease period. Making matters worse is that this gap is usually only discovered after a total loss. After the insurer pays its obligation, you may have to pay the bank or leasing company thousands of dollars out of your own pocket. The situation is an unfortunate side effect of the need to extend financing to accommodate extremely expensive vehicles. However, there are a couple of solutions to the dilemma.
The Auto Loan/Lease Coverage Endorsement
This optional coverage is available from a variety of insurance companies. The form provides coverage for the following:
Generally this optional coverage excludes items such as overdue lease payments, penalties (for excessive use, abnormal wear and tear, or high mileage), security deposits, costs of warranties or various types of credit insurance, or carryover balances from a previous lease.
Auto Replacement Cost Coverage
For an additional premium, a new car owner may buy coverage to settle major losses based on the vehicle's replacement cost rather than its depreciated value. There are some limitations, such as:
RJ Mitte — star of the hit television series “Breaking Bad” — is back at the breakfast table. After living through a series of his own “bad breaks,” he has partnered with the National Association of Insurance Commissioners (NAIC) on a series of videos to help educate fellow millennials about the importance of insurance education.
Bobtail and Deadhead Insurance Coverage
Trucking operations face unique transportation risks presented by instances of bobtailing and deadheading. A tractor that is traveling on the road without a trailer is considered to be bobtailing.
Example: Joe drops his trailer at Fran’s bakery and then heads to Doug’s Plumbing supplies to pick up a trailer. In between the two customers, he is bobtailing.
Any time a tractor is pulling an empty trailer, it is considered deadheading.
Example: Mary ran a load of apples from Saginaw to a processor in Grand Rapids but has no pickup in Grand Rapids and returns to Detroit with an empty trailer. She is deadheading between Grand Rapids and Detroit.
If you are an independent trucker operating for hire with a trucking operation; you have a concern. Once an independent trucker has completed his job, the insurance coverage provided by the trucking operation ceases. Bobtail and deadhead situations are two of the most common times when an independent trucker is operating outside the trucking operation’s coverage.
An independent trucker may buy a Commercial Truckers Policy and gain full-time coverage. However, this is expensive and creates an issue of duplicate protection. Another option would be to buy a Commercial Business Auto policy and add a coverage option with wording that eliminates double coverage.
Example: Lucy has a tractor-trailer unit and normally does contract work with ABC trucking. She decides to pick up some extra money by carrying a load for a friend without going through ABC. During the job, she collides with another vehicle. With this endorsement, there is no coverage because she was operating as a business. If she had just helped a friend, there would be coverage and if she had contracted through ABC, ABC’s policy would have handled the loss.
Under the above option, coverage does not apply to a loss involving anyone who is in the business of transporting property for hire and who is responsible for the named insured’s conduct as an insured. This is the portion of the wording that removes the chance of duplicate coverage.
Example: Lucy contracts with ABC Trucking to deliver a load of fruit. The weight shifts and the trailer fishtails. Before she regains control, she strikes two sedans, demolishing both vehicles. ABC trucking cannot ask for coverage under Lucy’s policy because they are in the business of transporting property for hire and they are also responsible for Lucy’s conduct.
While insurers are typically quite open to providing the additional coverage to handle the extra needs of independent truckers, some avoid operations involving vehicles that regularly travel to areas where the insurer does not operate. For advice on whether your firm has unprotected trucking-related exposure to loss, be sure to discuss your situation with one of our insurance professionals.
Having your car brake down in heavy traffic can be a nightmare, and when it happens drivers stop the car, and attempt to fix the problem on the spot. AAA's Lon Anderson says getting out of your car can be extremely dangerous, taking a minor problem and turning it into a fatal accident.
Plan ahead for insurance needs after age 50
If you are one of today’s 75 million baby boomers, you likely lead a hectic life. Many boomers and seniors are part of what’s called the “sandwich generation": preparing kids to leave the nest, caring for elderly parents and planning for your own retirement. These roles can present complex financial decisions with health and life insurance implications. Get educated and plan ahead for the road to come.
Caring for Aging Parents
The number of adults providing physical or financial assistance to a parent has tripled in the past 15 years. Nearly 10 million boomers aged 50+ are caring for an aging parent. Be informed about their health and life insurance choices to avoid financial surprises:
Make sure your parents enroll in Medicare before they turn 65 and review their coverage to determine if there are gaps. Medicare Supplement Insurance may be able to cover those gaps. If your parents need nursing home care, determine if their monthly income meets your state's eligibility level forMedicaid.
If your parents don't qualify for Medicaid, find out if they have a long-term care insurance policy or a life insurance policy with a rider or accelerated benefits provision.
Check to see if your parents have a life insurance policy. If so, store it in a safe place. If not, a Guaranteed Issue Whole Life Insurance policy may be an option to cover end-of-life expenses.
You may be researching colleges for your children and trying to figure out how to cover the costs. Know your options:
If you choose to retire before age 65, securing affordable health insurance can be a challenge. There are several choices to consider: