Currently, businesses are closing left and right for good during the pandemic. Here is some business advice to your small company during these tough times.
In our opinion, there is no better time to consider alternative risk transfer as a strategy to get more cost-efficient with respect to your current commercial property insurance, commercial liability insurance, workers compensation insurance, & commercial auto insurance.
As I write this the country and the world are about to exit the covid pandemic. If we frame the current conditions in terms of where we are in the property insurance, liability insurance & workers compensation insurance buying cycle; conditions couldn’t be more favorable to give your company a significant competitive advantage.
Taxes :
Since all 3 branches of government have changes hands in the last several years there are strong tailwinds pushing for significant tax increases which will erode corporate resources. We suggest utilizing a Captive Insurance strategy can give you significant tax efficiencies allowing you to keep the dollars inside your company to help reduce your variable cost structure. DOWNLOAD our Guide to Utilizing Captives by CLICKING HERE.
Coverage Availability & Rates :
Currently, we are in the through of a “HARD MARKET”; where conditions favor the insurance carriers as they restrict coverage and increase rates. Insurance buyers are frustrated because they have limited options. Further, they feel squeezed, and rightly so. The carriers are pointing to the “Social Inflation” of liability and commercial auto claims due to the insane jury awards. Buyers are pointing to “profits” earned and surplus growth to counter that claim. We think the buyers have a legit gripe.
Risk As Strategy :
Smart forwarding thinking CFO’s and C-Suite Executives understand that if they can leverage their balance sheets by increasing their retentions EFFICIENTLY, they can gain significant cost advantages that they can bake into their COGS (Cost of Goods & Services). If done properly they can reduce their insurance program costs by 35% which allows them to grow profits, market share, or both. Remember every dollar you save in your insurance program falls directly to the bottom line.
To understand if your company could benefit from a partial or full-on program restructuring CLICK HEREto schedule a 15-minute call. In 5 questions we can figure out if the strategy has legs for your org.
Using a common password leaves your organization at risk for cybercriminals to attack your account. Let’s add password protection as a major component in your organization’s cybersecurity plan. The risk of a common password is tremendous, and you should avoid having one at all costs.
Did you know:
4.7% of users have the password password;
8.5% use as their password : password or 123456;
9.8% use as their password : password, 123456 or 12345678;
14% have a password from the top 10 passwords used.
40% have a password from the top 100 passwords used.
79% have a password from the top 500 passwords used.
91% have a password from the top 1000 passwords used.
What does this tell you? Think twice before you make “abcdef” your next password. According to a study from SecurityCoverage Inc., if a password contains just six lowercase letters, especially if it’s a common word or combination, a cyber-thief can figure it out in 10 minutes!
However making a six-character password that has numbers AND symbols boosts complexity enough that a skilled hacker would need 16 days to break it, the study found. A task that is most likely not worth doing for that hacker.
Some sites now require a password with at least 1 uppercase letter, one number. and maybe a symbol as well. This is a step in the right direction even if it makes remembering your password just a little tougher. A simple and easy to remember example of this would be “Money17$.”
The real security of course comes from those dreaded passwords that are generated for you. They contain a longer password, of at least 8 characters, with a random order of letters, numbers, and symbols. These are nearly impossible to remember. However, an eight-character password with random letters, numbers, and symbols will take 463 years to break according to the same study. Nine random characters will take a whopping 44,530 years.
“People are careless because they don’t understand the threat said Ed Barrett, VP of marketing for SecurityCoverage.” LinkedIn was compromised in June and had 6.5 million passwords leaked. Yahoo had 6 million passwords stolen as well.
Another important consideration, don’t use the “show typing function” as you type your passwords. Many hackers don’t bother hacking at all but rather infect your employees’ computers with a virus that shows their keystrokes, thus the passwords.
The fact is you can either use strong complex passwords and have trouble remembering them or use simple, weak passwords and suffer from the risk of being hacked. We are not recommending a password of “nif$g*u3ng64dsf7” like a security expert would love as we understand the frustrations and hassle of remembering 20 passwords. We are advising that the next time you make a new password, especially for an important account, that you add some complexity to it. Go back to your most important accounts, like your bank account, and add a few numbers. It will greatly help in reducing your risk.
For a FREE comprehensive Cybersecurity evaluation, CLICK HERE.
A common cause for New York workers compensationinsurance claims can be overexertion. In fact, the Bureau of Labor Statistics recently published 2017-2018 overexertion statistics. They found that 295,000 in 2017 and 282,000 overexertion injuries in 2018 caused days off from work, and naturally, WC claims. These take up 31% of the non-fatal; work injuries that cause work days lost. This could result from a wide range of activities, such as lifting, carrying, throwing, pushing, or pulling. Although it is easy to overexert muscles, there are a few simple tips you could give your employees to help prevent such injuries. These near 600,000 days lost are all preventable by doing simple daily routines differently. Here are a few of these examples.
Start Easy
Many people have a tendency try to do too much when first starting a project. The result is that they end up injuring themselves, which means their work has to be put on hold until they heal.
Pace Yourself
Some make it a point to work as fast as possible. Unfortunately, they do not seem to realize that they could easily injure themselves while working at such a quick pace.
Know Your Limits
Regardless of the activity that a person is doing, it is always a good thing to know when to ask for help. Many people injure themselves by overdoing an activity, such as lifting a box that is clearly too large for one individual.
Set Obtainable Goals
Many times a person sets goals that he or she has no hope of actually reaching. By being reasonable with their workload, employees reduce the risk of injuries while still earning a sense of accomplishment.
Overexertion could happen regardless of how physically fit a worker is. This is why it is important to train your employees in the proper way to perform their job functions. Otherwise, you may be facing a New York workers compensation insurance claim and staff shortages.
Employees are the principal foundation of all companies. It is important to realize that there are many different types of employees and the ones you choose to hire will significantly impact how well your business is run. In other words, hiring motivated and well-rounded individuals will reduce expenses, and hiring incompetent ones will cost your company numerous losses. At Metropolitan risk, we never stop thinking about your issues and looking for ways to improve your bottom line. In our research we have found that effectively managing your HR practices can successfully achieve this. Yes, quantifying the mechanics of HR practices can seem vague at times, which is part of the reason many executives do not have a full understanding of the actual costs. However, to help clarify this situation, we have provided abasic quantitative guide that will make you more aware of your HR expenditures, and save you both time and capital.
Although employees should always be treated with respect, as an executive it is also important to view them in terms of their productivity. There is no denying that there are disparities in proportional productivity and salary for various employees. For example, an employee getting paid $60,000 and generating $100,000 per year for a company is much more valuable than an employee guaranteed $50,000 who is fired after one month on the job. If you ignore losses that result from HR practices, such as the $50,000 loss in the latter example, they can accumulate and put your business at risk. Contrarily, if you recognize the costs of your HR practices and identify where there is room for improvement, your business will experience multiple financial growth opportunities.
Along with creating a great workplace environment, in order to ensure a high number of motivated and productive workers, you must also invest additional funds in to lowering the costs of your HR practices. Good employees want to work for companies that hire capable coworkers and that are proactive in taking advantage of opportunities to make profits. Here are some questions you might want to consider when thinking of the best ways to invest in lowering your HR costs:
How much are you willing to invest to keep good employees working for your company (incentives, promotions etc.)?
How much cost are you willing to incur to keep poor employees?
How much are you willing to spend to maintain an HR management system to track performance improvement for employees?
How much are you willing to invest to drive down employee claims?
How much are you willing to invest to drive down your workers’ comp experience mod?
Although at first, it might not seem enticing to spend additional funds, in the long run, your business will experience significant gains due to an overall improvement in the management of your finances. Think of it as investing in long-term security with a permanently positive ROI.
Employee payroll is the third highest expense for companies in the United States(the first for small businesses). You want to make sure that you are making effective use of this cost and not wasting money on unproductive resources. If you feel that your company can use help in this financial area, please click here to get your free HR Expenditure Guide and get in touch with a Risk Advisor.
Multi-tasking is an everyday occurrence in businesses and is in most cases a necessity in order to get things done in a timely fashion. Author Steven Berlin Johnson describes multitasking as “skimming the surface of the incoming data, picking out the relevant details, and moving on to the next stream.” Skimming is what people do when they look at their receipt when leaving the grocery store, not what you do when balancing your company’s checkbook and reviewing P&L data. Here is some bookkeeper for business advice.
When deciding what is better for your business, ask yourself if consolidation of daily tasks is the answer. Do you want your in-house bookkeeper answering the phones, assisting clients, or doing HR all day ON TOP of the bookkeeping? Probably not! The assembly line automation was popularized by Henry Ford. The idea was that “hiring a specialist to perform a specific function creates a lot of efficiency.”
Things to consider about a bookkeeper for business:
This 3rd party service is a vendor that can be replaced. They want your business, so it is implied that there will be an expected level of customer service in order to keep the account.
Bookkeeping services are like any other business. They compete and they need to stay ahead of their competition in order to win accounts. They do this by constantly setting themselves apart and creating innovative ways to provide you efficient and accurate service.
Consistency. If something happens to your in house bookkeeper, what is the protocol? One day, maybe two days is manageable. But what happens if it’s longer than that, or they just up and quit? Bookkeeping services have built in processes to handle this and it is off of your plate so that you will get the SAME level of service no matter who your representative is.
Think of what tasks you have on a daily, weekly, monthly, or even quarterly basis. As an employer, you are responsible for:
Accurately calculating employee earnings and handing out paychecks
Deciding on tax withholdings and payroll deductions
Keeping current on new regulations, tax rates, filing of taxes, personnel issues and other payroll variables.
Beyond all of this, there is the small aspect of running, and ideally growing the business. Why waste your time on performing these functions when you could hand this off to someone like our friend Kandi Brem at www.Brembookkeeping.com, whose ONLY focus is making sure all of this is accurate and that the lights stay on. I am sure you can find better ways to use that time on things like improving your product or service, increasing revenue, and hiring talented employees.
There is a contractual issue and an insurance issue which, together, combine to create a “perfect storm” liability exposure for Owners/Developers and Contractors.
The exposure begins with the contracts you sign.Most state the contractor’s liability under the contract is not limited by the insurance coverage limits specified.
This exposure is then magnified by the fact that in many insurance policies the additional insured endorsements now contain wording to the effect that the additional insureds are covered for the lesser of the policy limit or the limit specified in the contract.
This “perfect storm” creates a potential uninsured risk to each of you.
For example, as a contractor:
You are required by contract to add the Owner/Developer or GC as an additional insured to your Liability policies.You do so.
That contract requires you to maintain a limit of $1,000,000.Since your insurance policies provide you with a total of $5,000,000 you feel you are fully protected.
Then there is a loss, due to your negligence, totaling $1,500,000.This is when you find out that things may not be so fine.
Your policy contained one of those additional insured limiting endorsements.The additional insureds would therefore only be covered by your policy for the first $1,000,000 as required by the contract.However, under that contract you are still required to defend and indemnify the additional insureds for the full loss.Where are you covering them for the next $500,000?Take a guess.That’s right – it would be out of your own pocket!
As the Owner/Developer or GC under the above example:
Are you ready to place your fate in the hands of the contractor’s ability to self-fund any losses beyond the insurance limits required in the contract?
Sure, you have your own insurance as the ultimate protection.However, any claims paid will negatively impact your premiums for the next 5 years.The increased cost could hurt your ability to compete for jobs.
The solution is simple and would add no additional cost to his bid.First, make sure you are requiring a limit which is sufficient for the exposure.Next, check the limit the contractor is showing on his certificate of insurance.If his available limit is higher, change the contract to match that limit.Example: You feel the exposure requires a limit of $1,000,000.The contractor’s certificate of insurance shows he has a limit of $5,000,000.You then change the contract to require a limit of $5,000,000.
Also make sure to ask about Risk Rocket! Risk Rocket is our insurance verification and analysis system designed for General Contractors, Developers and Real Estate Owners that do not want to rely solely on the Certificates of Insurance their Sub Contractors or Contractors provide.
One of my favorite bloggers, Seth Godin, recently posted on his blog about Pitchers and Hitters. His main point was that those who pitch control the game by deciding what pitch is thrown, where, to who. That is why they make more money than any other position in baseball. Hitters by contrast react to what is thrown at them deciding very little.
It’s notable that if you are an elite hitter and have a batting average of .300 your failure rate is 70%. If you are an elite pitcher your E.R.A is under 3 which makes your success rate north of 70%.
As a fellow business owner I always want to pitch. I want to decide on a course of action and take control and responsibility of my business’s destination. Yet when it comes to purchasing insurance I see so many business owners step off the mound and become hitters. They wait until three quarters of the year have ended before they order their loss runs, mull the results post facto, and then hand the random results to three other brokers to go and solicit the marketplace for quotes. The one who comes back with the best quotation wins their business for that year. This essentially lets the insurance carrierschoose their brokerage relationship as the pricing they received was mostly a result of their loss runs, and little to do with the actual broker.
By contrast the best CFO’s and business owners are by their very nature pitchers through and through. They understand that the price they pay on insurance is a function of how profitable their account is to the carriers that underwrite them. Insurance pricing is a function of a historical loss ratio between premiums paid and losses paid out. If the carriers have lost money in more than one of the last five years your premiums and ancillary costs rise with it, sometimes significantly.
These folks, pitchers,are proactive. They choose and leverage their brokerage relationships to first and foremost help them quantify and manage their claims, to take action to decrease reserves, and to prevent future claims. Theysolicit ideas to help them prevent losses from happening in the first place; and know their loss picture quarter to quarter so they can constantly adjust their “pitches” to get outs. That’s how they win, using insurance which is a big part of their expense budget as a significant competitive advantage in their unit cost structure. This is why they are the most richly compensated in the game.
Be Prepared for an Increase… FEMA has scheduled a number of changes to occur on April 1st, 2015 that will impact the overall cost of many flood policies. The one that stands out most to us is a new surcharge which will be implemented across the board to all flood policies based on the occupancy type of the insured building regardless of flood zone, buildings post- FIRM or pre-FIRM, and whether or not your property is in a high risk area or a low risk area.
As stated in the March 2015 edition of Independent Agent, “In an effort to offset the loss of revenue to the NFIP caused by slowdown in the elimination of subsidized rates, Homeowner Flood Insurance Affordability Act of 2014 (HFIAA) calls for a new surcharge on all policies to build a Reserve Fund that covers future claims.” Although the new surcharge is allowing policyholders to keep their Pre-FIRM subsidized rates longer it is now adding an additional provision of its own which will affect all policyholders’ pockets.
What does this mean to you? Expect to pay more in premium this year upon renewal. The HFIAA surcharges are as follows:
[av_table purpose=’tabular’ caption=’HFIAA Surcharges Effective April 1, 2015′ responsive_styling=’avia_responsive_table’ av_uid=’av-n2u22w’] [av_row row_style=” av_uid=’av-ksa3c8′][av_cell col_style=” av_uid=’av-j9xn8o’]Primary Residential: Single Family and Individual Condominium Units [/av_cell][av_cell col_style=” av_uid=’av-httcy0′]$25 [/av_cell][/av_row] [av_row row_style=” av_uid=’av-gb8zco’][av_cell col_style=” av_uid=’av-e2m16g’]Non-Primary Residential: Single Family and Individual Condominium Units [/av_cell][av_cell col_style=” av_uid=’av-c41iug’]$250[/av_cell][/av_row] [av_row row_style=” av_uid=’av-b7aoko’][av_cell col_style=” av_uid=’av-9hq8wo’]Multifamily Residential: Condominium and Other Buildings Non-Residential[/av_cell][av_cell col_style=” av_uid=’av-798vco’]$250[/av_cell][/av_row] [av_row row_style=” av_uid=’av-6exwns’][av_cell col_style=” av_uid=’av-4ca5eg’]Non-Residential [/av_cell][av_cell col_style=” av_uid=’av-2g3sx4′]$250[/av_cell][/av_row] [/av_table]
According to FEMA, this surcharge will apply annually until there are no more subsidized rates in the program.
Do you ever wonder how successful people consistently achieve their goals? Have you unlocked why you achieve certain goals while others fall short? Do you want to transform goals to achievements?
Many companies start the new year with new goals and aspirations, some of the most common being:
Reduce Costs
Retain Clients
Increase Profits
Improve Employee Safety
Improve Employee Morale
The most common mistake companies make in outlining such objectives, however, is not providing enough details and specifics. This ambiguity is often at the root of most failed goals, but it is not the cause. Most of us have heard of “writing down” our goals or cutting out pictures of the visions of our successes and making a “collage” and posting it, where we can see it every day and remind ourselves of where we want to go. This practice may seem impressive, but it doesn’t ensure that we will be successful because we haven’t focused on the most important factor . . . HUMAN NATURE!
As Chip and Dan Heath wrote in their book Switch, when significant change is involved in accomplishing your goals, you must appeal to both sides of the brain:
Emotional
Rational
AND, you must influence all three of these areas:
Environment
Heart
Mind
Most of the changes we’re referring to require a significant adjustment in behavior. If you don’t allow for this, you are doomed to fail, and HUMAN NATURE is such that it resists these changes. An example would be the common goal of weight loss. Anyone can eat just fruit and veggies for one or two meals and maybe even one or two days, but eventually the sheer willpower needed to continue on this path will wear off and “poof” there goes that plan! What’s essential for success is appealing to these two sides of the brain: Emotional and Rational. The Rational side tells us it makes “sense” to do something. The Emotional side ACTUALLY does it.
A few years ago I met John, a client, and he was in the midst of dealing with a major challenge in his business. John had maintained a successful plumbing business that he started by himself when he was just seventeen years old. From humble beginnings, John found something he was good at and kept doing it. As the years went by, he added one employee at a time, and before he turned around, he had more than eighty people working for him, and sales exceeding $10 million per year! The problem was that John was working at least eighteen hours a day and constantly chasing many aspects of his business. John’s company completely lacked efficient systems and a cohesive structure, and while he was “successful,” he was also “exhausted.” He knew that this pace was unsustainable. Something had to change or he would have health problems or have to sell the business. John finally turned to taking on a partner, Anthony, to run the “accounting and operational” sides of the business, which was certainly a step in the right direction. It was just the beginning, however, for he had only dealt with one of the areas necessary for significant change: Mind. In fact, he never changed the environment. All his employees and culture remained the same, and he also never changed his heart. He saw his new partner as a “magic bullet.” John continued to do business and manage his operations exactly the same way. His attitudes and operating behavior never changed and, accordingly, Anthony was constantly putting out fires and looking backward at what wasn’t working and what was wrong, and never had a chance to build to the future and restructure. Ultimately, John was defeating his own partner and goals because he wasn’t fully committed to change.
Without appealing to BOTH sides, when the going gets tough, the “emotional side” will get going and leave all “rational” thought behind by falling back into the habits that feel comfortable.
The 3 Essential Keys to transform goals to achievements :
Specifically direct the Rational part of the brain by scripting the initial steps in the new work process along with a clearly outlined step-by-step process (a decision tree of sorts).
Then motivate the Emotional part of the brain by being specific in the GOAL and what the goal LOOKS and FEELS like. Doing this will empower the emotional side of the brain when the tough and challenging times come. And they will come! You need to realize that the challenges and almost “failures” will happen, but be aware that they are not “failures”—rather, they represent the education that is needed to perfect these changes.
Shape the path that will direct the team through the challenges along the way and what guiding principles are needed to stay on track.
All in all:
The START is scripted. The GOAL is specific on how it will feel and look. The path between START and GOAL is impossible to know completely, so you must have your guiding principles in place and stay on the PATH.
I spend most of my time helping companies deal with a very common challenge —employee injuries and the claims associated with them. This problem is even more common for such industries as construction, manufacturing, healthcare, and transportation, where the simple act of opening their doors to do business involves an innate “risk” associated with practically every aspect of their work. These companies certainly don’t want their employees to get hurt, nor do they want the added expense that goes along with paying for the medical care and lost wages associated with these injuries. If I were to merely indicate how much it’s costing them, I would only be appealing to the Rational side of their brain. Conversely, if I were to only explain that these injured employees have families, I would only be stating the obvious—no one wants to hurt someone’s family. I would only be appealing to the Emotional sIde of their brain. At Metropolitan Risk, we use a series of analytics to determine:
What is currently happening and identifying any trends—FACTS
What it’s costing you—RATIONAL
What opportunity/opportunities are available to you to handle these issues—EMOTIONAL
What you need to do—ACTION PLAN & LEADERSHIP = SHAPE THE PATH
