R&R Insurance Blog

R&R Insurance is incredibly proud to announce that Michael Franz was recently named CFO of the Year by the Milwaukee Business Journal.

As in years past, the winners were nominated by colleagues and friends based on their wide range of experience, commitment, character and value to their organizations. The Milwaukee Business Journal's group of judges pored over dozens of nominations, narrowing the field to the final 14 winners. All winners will be profiled in the Milwaukee Business Journal’s Oct. 9 print edition and will be honored the same day at an awards luncheon in downtown Milwaukee.

Click here to read the full article.

Fully understanding your organization’s Work Comp Experience Mod and OSHA DART Rate will not only help you achieve your desired outcomes for employee safety, but will also give you a point of reference for benchmarking against others in your industry. In addition, knowing your DART rate will help you prepare for a potential site visit from OSHA.

However, in order to better understand these you two variables, you need to first recognize the difference between the two. The following is a breakdown of their differences:

EXPERIENCE MOD

The Work Comp Experience Mod is a numerical expression of a company's accident and injury record compared with the average for the firm's industry. An organization’s e-mod is calculated using payroll and loss data for the oldest three of the last four years.

An experience mod of 1.0 means a company has an average safety record, while an experience mod of 0.80 means a company has a good safety record that merits a 20 percent discount. An experience mod of 1.20 means the firm's accident rate is above the industry norm and raises a company's costs by 20 percent.

DART RATE

OSHA’s DART Rate, which is an acronym for Days Away or Restricted Time, is a measure of accident severity. It counts the number of cases in the calendar year in which a company had an employee away from work due to an injury or who was working under restrictions due to a work injury.

As you can see from the breakdown above, the common denominator between these two variables is eliminating lost time injuries. R&R Insurance has multiple resources available for helping you understand as well as achieve your desired outcomes for both your Experience Mod and DART Rate. Contact a knowledge broker for additional information.

Take control of the health and productivity of your employees - and increase profit. WellCompForLife is R&R Insurance Services’ total solutions approach to that will provide your company with the tools to increase the life span and productivity of your employees - and ultimately your bottom line!

The top three driving trends impacting an employer’s bottom line are Obesity, Workplace Injuries and the Aging Workforce.

Addressing These 3 Corporate Burdens to Increase Your Profit

1. Obesity - Yes, That Means Lose The Weight
Findings show that obese workers were more likely to report occupational injuries, with a great frequency of strains and sprains, along with falls and overexertion injuries. Consider these statistics: A comparison of obese employees to normal weight employees: 50% more workers’ compensation claims, 13x more lost work days, 7x higher medical costs, 11x indemnity claim costs. And this is just the workers compensation part. The negative effects of obese employees on your health insurance costs are overwhelming. Diabetes, heart disease, chronic pain - can all be attributed in part to being overweight. That means you have to do something about it - employee wellness programs, fitness, healthy eating, lifestyle changes for your employees and their families.

2. Reduce Workplace Injuries: Reduce the injuries to reduce the work comp claims!

• Slip-and-fall injury prevention: ensure a safe working environment by maintaining parking lots and sidewalks; encourage employees to wear appropriate footwear for wet or slippery conditions. Make sure you have handrails at all stairwells and inclines/declines - special attention to this for your aging workforce.
• Ensure employees can meet the physical requirements of the job: consider a post-offer, pre-employment physical for new employees – be sure the physician covers medical history as it may reveal something not seen during the physical (the cost of the test would pay for itself when preventing a back or shoulder claim!) Pay special attention to your aging workforce for their physical requirements.
• Ergonomics enhancement: ask employees for suggestions on how their job can be tweaked to avoid fatigue or soreness; consider job rotation for repetitive tasks (also promotes cross-training!)
• Wellness programs to aid injury prevention: help prevent strains, sprains, and falls by improving flexibility, strength, and balance. Great examples is starting a flex and stretch program, cover part of a gym membership, or hold exercise classes like yoga, Pilates, or Tai Chi.Also, having a structured return-to-work program has several benefits, the most important of which is the reduction of lost-time (lost-time has 3 times greater impact on your workers compensation premium dollars than a no-lost-time claim).

There are literally dozens of ways to increase safety and reduce injuries at your place of work. If they aren't apparent to you, bring a knowledgebroker in - we'll take a look around and give you some pointers.

3. Address the Aging Workforce
Experts predict that by the year 2020, 25% of the US workforce will be 55 years or older. Couple this statistic with the fact that most people are working past the traditional retirement age of 65 and organizations need to pay special attention to this sector of the workforce.

On average, older workers are injured less frequently than younger workers. However when older workers are injured, it will be more severe and have a longer recovery time. See Preventing Injuries in an Aging Workplace.

R&R Insurance has found that if businesses address the health of their employees, reduce their number of injuries and keep a close eye on ways to accommodate the aging workforce, you will see a significant positive effect on your bottom line! WellCompForLife processes will increase the health and longevity of your employees and their families giving you a lot more control over your health and work comp insurance costs, all while improving the productivity of their employees. This is control business owners don't realize they have. At R&R Insurance, we call this program WellCompForLife!

Join the WellCompForLife discussion on LinkedIn!

For more information about WellCompForLife, contact a knowledgebroker today!

It’s happening more often and to more businesses, regardless of the size or type of business.

An email is received instructing the transfer of money. It appears legitimate—from the CEO, CFO, or trusted vendor with instructions to initiate a wire transfer. No red flags are raised. The money is wired but the email was fraudulent. Unsuspecting businesses are falling victims to what is essentially a modern day con job. According to the FBI, “companies across the globe lost more than $1 billion from October 2013 through June 2015 as a result of such schemes.” The Wall Street Journal reported on one such company, Mega Metals that lost $100,000. Mega Metals, Inc is a 30 year old company with 30 employees.

What should you do from a both a preventive and reactive standpoint?

The best scenario is one in which the attempted fraud is detected and stopped. Alert and educate your employees so that they can be on the lookout for these schemes. One of our carrier partners has published a risk management brochure, the Guide to Preventing Social Engineering Fraud, by Chubb Insurance. Here are some of their recommendations:

1. Never release confidential or sensitive information to someone you don’t know
2. Establish procedures to verify incoming checks and ensure clearance prior to transferring money by wire
3. Establish call-back procedures to clients and vendors for all outgoing fund transfers
4. Verify any changes to customer or vendor details
5. Be suspicious of unsolicited emails
6. Avoid responding to any offers made over the phone or via email
7. Be cautious in situations where a party refuses to provide basic contact information

If all of the loss prevention measures fail and your business becomes a fraud victim, is your business insured?

Even though most business policies contain an extension of coverage labeled “Crime Insurance” this is usually intended to provide a small limit of liability for Employee Dishonesty losses only. The good news is that insurance coverage is available from several carriers designed specifically to cover this type of loss.

These crimes are successful because they exploit human qualities of trust, helpfulness and fear to manipulate people. Even with proper precautions prevention may not be enough.

Download our free e-book, Understanding Cyber Liability Insurance, or contact a knowledge broker to ensure that coverage is in place should your business become a victim.

Are you aware of punitive damages? Do you know if they are excluded from your current insurance policy? Society Insurance recently released an article covering the basics of punitive damages and how not having the proper coverage can affect your business.

Society states that simply put, punitive damages are a monetary award given to a plaintiff for the sole purpose of punishing a defendant for wrongful acts. They are not awarded in every case; acting maliciously or having an intentional disregard for the rights of the plaintiff are reasons for such an award. Gross negligence is a factor.

Punitive damage awards are above and separate from normal compensatory damages a plaintiff receives such as medical bills, lost wages, pain and suffering, etc.

An article by the Milwaukee Journal Sentinel outlines a case in Wisconsin where a $100,000 award for punitive damages was upheld. It involved a restaurant customer finding hair in his steak that was put there intentionally by a cook. The lawsuit claimed the cook had done it before. The jury’s verdict was a punishment for the restaurant not taking corrective actions with the cook sooner.

Unfortunately for defendants, some insurance carriers have excluded punitive damages in their policies. To learn more about the proper coverage for your business, contact a knowledge broker at R&R.

For many business owners, premium audit paperwork, auditors, or phone calls to complete an audit occur annually. For those business owners with employees, this is a guarantee. Every year, like clockwork, you will be required to report your employee payroll to your Workers Compensation insurer. And if the audit isn’t complied with, the carrier maintains the right to increase the payroll on your insurance and charge additional premium for it.

So why does an audit have to be completed every year? In order to understand this, it is important to know what exactly an audit is. When you purchase coverage, especially Workers Compensation, you are providing an estimate as to the annual wage you think you may pay an employee, or your gross sales for that time period for General Liability coverage. Your premium for the year is then based on that estimate. When the policy term ends and the audit is completed, it is an evaluation of the estimated payroll vs. what was actually paid out, or the estimated gross sales vs. actual. So if the estimate at the beginning of the year was higher than the audited figures, you may be eligible to receive a refund. And if the estimate was a slightly low, additional premium will be charged accordingly.

The audit process helps insurance carriers determine the final premium for your policy based on actual exposures. It also helps the carrier determine that your business is classified correctly – taking into account all of your exposures and operations. In addition, it may help determine any potential gaps in your coverage for additional operations or exposures that may have come up throughout the year. It is a service that helps guarantee you only pay the premium you should be paying. The premium audit process is also a condition of the policy when you agree to purchase it – you give the insurance carrier the right to examine your books and records for audit purposes.

Whether it is a physical audit, a phone call, or paperwork to complete, the audit is designed not only to benefit the insurance carrier, but the client as well. Being charged fairly for your coverage is important and making sure that you are protected adequately is vital for the success of your business.

For more information on the premium audit process, contact a knowledge broker at R&R.

Cincinnati Insurance stated in a recent blog post that losses occurring on property you own can affect your livelihood and that of your tenants. They can also affect your insurance rates and eligibility. Without the proper controls in place, you could be saddled with the responsibility of owing for injury or damages that you did not cause.

Recognize the Risks

When you understand the risks you face as a property owner and lessor, you can better manage them. Consider these scenarios:

• Natural perils – A tornado sweeps through town, damaging your building and your tenants’ contents.
• Fire – A grease fire starts in a restaurant at one end of your building. Before it is extinguished, fire damages multiple units and tenant contents.
• Third-party injury or illness – A patron slips and falls in the parking lot, spraining her ankle.
• Change in occupancy – A restaurant replaces a retail store in one of your units. As a property owner, you want to determine if the current sprinkler system is able to handle the demands of a restaurant.
• Change in tenant operations – A retail craft store expands its operations to include pottery making. With this expansion, your tenant adds kilns to heat-treat ceramic projects.
• Vacancy – Your unoccupied building is vandalized, resulting in damaged property.

Review the Responsibilities

A well-designed lease agreement can assist owners in transferring responsibility for payment due to bodily injury or property damage to the legally responsible party. Consult with legal counsel when evaluating your current lease or other formal contract. When consulting with your attorney, consider whether your agreement:

• is signed by all tenants
• contains appropriate anti-subrogation wording and indemnification–hold harmless provisions favorable to you and acceptable under your state’s laws
• authorizes you to develop, change and enforce rules and regulations for the premises
• defines which areas you control and which the tenant controls
• defines the maintenance obligations of all parties while specifying the scope of the operations and the steps you will take if the tenant defaults on these obligations
• grants you the right to inspect the leased premises for conformance with the lease provisions concerning maintenance and to point out to the tenant any obvious hazards
• requires the tenant to obtain permission before performing any building alterations
• contains provisions regarding use of hazardous substances, dispensing of liquor and other activities that increase the risk of loss
• requires service contractors who come on your premises to provide certificates of insurance verifying adequate limits of insurance and appropriate state licenses, where applicable
• requires tenants to obtain specified liability insurance on behalf of the owner, with you listed as an additional insured on a primary basis. Make sure you obtain proof that the tenant has acquired and maintains all required insurance

Click here to read the full post by The Cincinnati Insurance Company, or contact a KnowledgeBroker at R&R for additional information.

Summer in Wisconsin calls for countless family celebrations, parties with friends, and neighborhood barbecues. Along with that comes the responsibility of what happens if an accident occurs at your home. To test your knowledge of your own insurance coverage, see if you can accurately answer the questions below.

Are the following incidents covered by your home insurance policy?

1. The neighbor’s son, Little Timmy, taunts your nine year old Golden Retriever and she snaps back with a bite. Timmy is left with a gash on his leg and a trip to the walk-in clinic. Covered?

2. Little Timmy’s older brother teaches the kids how to play backyard baseball and one goes right through the brand new front window. Covered?

3. Your family sticks around much longer than expected and the mayo filled pasta salad doesn’t get put away. They all call the next morning to tell you about their awful food poisoning and midnight trip to the emergency room. Covered?

4. Grandpa Joe, Uncle Don and Uncle Bob don’t listen to your direction and all sit on the same side of the 20 year old porch. All three are left sitting on the concrete when it collapses. Covered?

5. Your best friends bring a bucket filled with water balloons to your son’s birthday party. After an all-day battle, unlucky Little Timmy takes one right to his eye and winds up back at the walk-in clinic. Covered?

If you answered yes to all five questions above you are an expert insurance policy holder! All of the incidents above would be covered under your homeowners’ policy.

However, more often than not we recommend an Umbrella Policy to make sure you are adequately covered. Whether you own a home or car, are married, or have kids, an Umbrella Policy can save you from possible lawsuits down the road. Click here to learn more about the importance of having an Umbrella Policy.

As more and more people take advantage of the rapidly increasing rideshare options like UberX, Lyft, and Sidecar, it’s important to know what coverage you have. Whether you are the driver or a passenger, you should always fully understand what your insurance policy covers and where you may be exposed.

In general, there are three different insurance policies that may be active throughout the rideshare process:

1. The Driver’s: the owner of the car and the driver of the vehicle must have a personal auto policy (PAP) provided by a personal insurance carrier
2. The Company’s: the commercial auto policy (CAP) is provided by the rideshare company, officially called Transportation Network Companies (TNCs)
3. The Passenger’s: if an individual has a PAP, then as passenger, the individual may have some coverage as a last line of defense

The driver’s PAP is in place until the rideshare app is turned on. As soon as the driver logs into UberX or Lyft, then all coverages provided by their PAP cease. It is also important to note that the CAP does not begin to provide any coverage or full coverage until a match has been made on the app. During this time, there is a gap in adequate coverage for the driver. (Click here for additional details on this gap).

As soon as the match is made, the CAP provided by the rideshare company begins. Most CAP policies carry liability limits of $1 million, though this is not guaranteed. Physical damage coverage (Collision and OTC) is available if the driver has the coverage on their PAP. These high liability limits could prove to be a source of comfort if the rideshare driver is involved in an accident while picking up or transporting a passenger. However, if the rideshare driver is at fault, and the passengers are injured, it is not as clear how much coverage is available for Med Pay for those passengers.

Fortunately, if the passengers have their own PAP, the Med Pay coverage will follow them into the rideshare vehicle. Unfortunately, while there will be some coverage to pay for medical expenses, the Med Pay limits are usually in the thousands while the injuries can cost tens of thousands of dollars.

As you can see, insurance for ridesharing can be complex. If you have any questions about your coverage as a passenger or the driver, please contact a Personal Lines knowledge broker at R&R. We can walk you through the process and assist with any questions you may have.

If you are considering becoming a rideshare driver, this provides great insight into when and why you have no coverage.

There is a void between the time one’s personal auto insurance policy stops providing any coverage and the time the commercial auto policy starts. If there is ever an incident that occurs during this gap, drivers could find themselves left to pay for all damages on their own.

This gap exists because of the rapid rise of Transportation Network Companies (TNCs) like UberX, Lyft, and Sidecar. They have gained in popularity and spread throughout the US so quickly, that the insurance industry and lawmakers have not had the time they require to methodically update the policy language or laws. Revisions are required to better manage the new risk.

There are three distinguishable risk periods in the TNC business model. Period I is when the driver turns the mobile application on, logs in, and is waiting to be matched with a passenger. Period II is when a passenger has requested the driver’s services and the driver agrees – a match is made. Period III is when the passenger is in the vehicle with the driver, and they are en route to the desired location. So, when exactly does the driver of the private passenger vehicle become a transporter?

Personal insurance carriers argue that the instant the app is turned on, the driver is now working for the TNC – coverage ends at the start of Period I. The TNCs argue that the driver does not begin working until a match is made – coverage begins at the start of Period II. And therein lays the gap. Neither the personal insurance carriers nor the TNCs want to offer any coverage during Period I.

The traditional idea of carpooling and sharing the gas expense with a friend on a road trip does not present any problems to a personal auto policy. However, there is a dilemma when the driver is no longer sharing expenses but making a profit by delivering passengers or goods. This is because almost all personal auto policies have a specific exclusion for the transportation of goods or passengers (Livery Exclusion). Personal insurance providers have this exclusion because there are increased risks and claims that are associated with livery exposures, such as distracted driving, commuting in congested traffic, and additional mileage.

This exclusion, by definition, means that the very second the UberX or Lyft driver turns on the mobile app to find a passenger, the coverage from the personal insurance policy disappears. To make it even clearer, many insurance carriers are revising their policy language to specifically exclude coverage during all periods while the driver is working for a TNC.

The TNCs, on the other hand, view their drivers more like contractors than employees and do not believe that the driver has become a transporter in Period I. Their interpretation is that the driver is only hired to complete a job when a match is accepted. If there is no match, then there is no contract, and, if there is no contract, then the full insurance coverage is not in place.

In addition, TNCs are concerned with drivers unintentionally and intentionally turning on the app and not accepting any matches. They do not want their commercial coverage to become a substitute for personal insurance. It is on the other side of the coin, but again, there are increased risks and claims that the commercial insurance providers do not want to be held accountable for.

Still, some TNCs may provide lower limits of liability coverage only (bodily injury and property damage done to others) during Period I. However, these limits could easily be inadequate for serious accidents, and there would be no physical coverage for the vehicle.

So, for now, if you are considering becoming a rideshare driver, you will want to 1.) verify adequate coverage with the TNC, and 2.) be extremely cautious during Period I. Otherwise, if there is a claim, you could find yourself all alone. If you have additional questions, contact a knowledge broker at R&R insurance!