Business Newsletter - August 2011

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2205 Point Blvd., Suite 200 | Elgin, Illinois 60123
847-741-1000 | www.lundstrominsurance.com | Fax 847-428-8857


"Serving you, your business and your community since 1956"

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Vol. 19 No. 1

 

Protect yourself from auto theft


Auto theft is a common and costly crime. Many stolen vehicles are never found, and those recovered are often stripped, vandalized, or destroyed. Although new car models come out each year with improved security systems as theft-deterrents, the bottom line is that any vehicle owned by your business is at risk.
 

Insurance Coverage

Your commercial auto insurance policy will cover theft, provided you have comprehensive coverage. This protection, which is optional, will pay for the loss of a vehicle or for stolen components, such as airbags or xenon headlights, which are popular black market items for car thieves.
 
The cost of comprehensive coverage generally depends on your risk of loss, based on the type of car you own, and where your business is located. However, discounts may be available in your state for the use of prevention methods, such as anti-theft devices and auto-recovery systems. Comprehensive insurance also covers your business vehicle in the event of fire, vandalism, and weather-related damage.
 

Prevention and Protection

While insurance offers a measure of financial protection against auto theft, there are steps you can take to minimize your risk. The simplest and most cost-effective way to deter thieves is to use common sense: park in well-lit areas, close your windows, lock your doors, and never leave your keys in the ignition.

In addition, the National Insurance Crime Bureau (NICB)—a nonprofit organization dedicated to combating insurance fraud and vehicle theft—recommends using warning devices, vehicle immobilizers, and tracking systems to further protect your vehicle.

Warning Devices

Visible and audible anti-theft devices can make a thief think twice. Consider audible alarms, steering wheel locks, steering column collars, theft-deterrent decals, tire locks/deflators, and window etching. Many glass companies will etch a vehicle's identification number (VIN) into each glass surface for a nominal (or no) fee. Because these marked windows will need to be replaced in order to "remarket" the vehicle, it may be less appealing to car thieves.

Vehicle Immobilizers

Ignition protection prevents thieves from hot-wiring your vehicle. "Smart" keys, standard for some vehicles, ensure that an engine cannot be started without a specific key that contains a coded computer chip or radio frequency. Kill switches and fuse cut-offs are relatively inexpensive devices that immobilize the fuel or electrical systems, preventing the engine from starting. Starter, ignition, and fuel disablers are also standard in some vehicles, and short-circuit the electrical or fuel systems, preventing the engine from starting or causing it to shut off quickly.

Tracking Systems

When a vehicle with a recovery system is stolen, tracking devices emit signals to the police or a monitoring service. Generally ranging in price from $400 to $1,500, these systems make it easier and faster to recover a stolen car. A quick recovery may help minimize damage.

The NCIB reports that only 62% of stolen vehicles are ultimately found. Taking preventive measures can help you beat these odds, and securing the proper insurance coverage can protect your business from financial loss in the unfortunate event your vehicle is stolen. Give us a call for more information.
 

Did You Know?


Talent Shortage

According to a survey by Dice Holdings, Inc., the Bureau of Labor Statistics reports that American companies across industries added more than 200,000 jobs per month from January to May this year, while 51% anticipate hiring more professionals in the second half of 2011. With positive job growth, a gap still exists between available jobs and skilled workers. Of those private sector employers hiring, 49% recruit candidates from outside of their local markets to fill open positions.

Marketing Tools

Social media usage is up, but small business owners still choose "old fashioned" e-mail over Facebook or Twitter to build their brand. A survey by Pitney Bowes Inc., software and shipping services provider, revealed that 68% still prefer e-mail as a business tool, while 58% use multi-channel marketing, including social media and direct mail. According to the report, despite e-mail's popularity, small businesses are trending toward social media (20%) and mobile marketing (12%).

Back to Work

In the last year, 59% of laid-off workers from full-time jobs found new positions, up from 55% the previous year, according to a 2011 survey sponsored by Harris Interactive. Of those hired, 63% were men compared to 50% women; 31% were rehired by their previous employers; 23% got more pay, up from 18%; and 33% relocated. Workers who retrained or repackaged their skills to land jobs in different fields rose from 48% to 60%.
 

Additional insured: not just a name


As a business owner, you may enter into relationships with other businesses, government agencies, and individuals. These relationships may expose you to risk, such as liability caused by another party's negligence or faulty/hazardous products. "Hold harmless" agreements— provisions where one party assumes liability by indemnifying the first party—protect your company against potential liability; however, in many situations, you may want to also be covered as an additional insured by an insurance policy owned by that party.
 
Business News Image 1For example, suppose you're doing business as Contracting Company X, a general contractor, and you enter into a contract with Development Company Y, a high-end building company, to build 15 new homes.  You hire Electric Company Z, a subcontractor, to provide the necessary wiring and other electrical work for the project.  To protect you from any claims that may arise from Electric Company Z's negligence while working for you, you may want to require Electric Company Z to list you as the additional insured on its insurance policy.
 
However, your original contract is with Development Company Y.  If negligent wiring by Electric Company Z results in a fire, Development Company Y would most likely turn to you for compensation.  You may be protected from this claim if you're the additional insured under the policy of Electric Company Z, the named insured.
 

Potential Concerns

As the additional insured under Electric Company Z's insurance policy, you'll want to be aware of the following four potential concerns:
 

1. Policy Cancellation.  Electric Company Z, or its insurance company, can cancel, change, or refuse to renew the insurance policy at any time without notice to you as the additional insured.  To help protect against this, request that a new certificate be presented periodically until the project or contract is complete.

2. Inadequate Liability Coverage.  Electric Company Z's liability limits may be insufficient to protect your exposure as the additional insured.  Consider requesting limits that will help safeguard your interests.  In addition, review your own insurance policy to ensure you have adequate liability coverage.  Your status as an additional insured on another's policy is an extra level of protection; it should not be considered a substitute for the protection you have with your own insurance provider.

3. Excess Policy.  An insurance company may deem your coverage as the additional insured under Electric Company Z's policy to be in excess of the coverage under your own insurance policy.  Thus, your insurance policy would be considered the primary policy for settling claims, and Electric Company Z's policy would take effect only after your own policy limits have been exhausted.  To limit your risk, consider requesting an insurance certificate that specifically states Electric Company Z's policy is primary with respect to your status as the additional insured.

4. Other Exclusions.  Coverage for hazards, such as underground construction, landfill operations, or explosives, may be excluded from Electric Company Z's policy and could therefore negate your coverage as the additional insured.  To help protect your interests, consider reviewing Electric Company Z's policy for inclusion of this type of coverage.

Naming you or your business as the additional insured on another party's insurance policy can help protect you from liability due to negligence or faulty products.  However, it may not provide you with all the coverage you need.  So, if you're listed as the additional insured on another party's insurance policy, consult with an insurance professional to evaluate your risks and to familiarize yourself with what the policy will cover in various scenarios.  For a review of your needs, contact one of our qualified insurance professionals.

 

For Your Information


Disaster Preparedness

In the event of a tornado, fire, flood, or other catastrophic event, businesses need to be ready with an effective plan to ensure the safety of their employees and worksites. The Federal Emergency Management Agency (FEMA) has partnered with the American Red Cross to help business owners evaluate their existing procedures and make improvements to be better prepared for any emergency situation. For more information, visit www.ready.gov/business.

Minority Entrepreneurs

The U.S. Department of Commerce's Minority Business Development Agency (MBDA) is a network of business centers that offers resources to minority business owners, such as consulting services and access to Federal loans and government contracts. MBDA Centers promote economic growth and job creation in underserved regions for disadvantaged groups excluded from opportunities because of race, ethnicity, gender, disability, veteran status, or residence in isolated areas. To learn more, visit www.mbda.gov.

Water Conservation

The cost of a gallon of water is rising faster than inflation, as many experts predict some type of water shortage across the country by 2013. To avoid a crisis in your restaurant business or food service and reduce all utility bills, it's important to conserve water. The Solutions for Sustainability initiative provides free tips for food service- related businesses to advance their environmental sustainability efforts. To learn more, visit http://conserve.restaurant.org.
 

"Speaking the language" of safety


Constant changes and advancements in today's technology have transformed our society into more of a global community. This trend may affect our daily lives, both at home and in the workplace.

In an expanding international business community, many companies have a diverse workforce including employees who speak multiple languages. With all the possible obstacles that a multilingual workforce may pose, safety should be a primary consideration.

As a business owner, you want your employees to be safe. When you have employees who don't speak English as their first language, how do you teach them proper safety procedures? Many options are available to help ensure that employees are aware of proper procedures and remain safe.

Sign of the Times. Multilingual signage, particularly denoting hazardous conditions, may be a viable option. If half of your workforce speaks Spanish and the other half speaks English, posting signs in both languages may be a viable solution. When posting signs, you may want to include pictures and/or graphics to make the hazards more identifiable. For example, near dangerous materials, you could post a sign with words and an appropriate warning picture that corresponds to the hazard.

Training with Translators. When training your employees in appropriate safety procedures, consider hiring a translator. While some employees may speak both English and another language, relying on them as translators may not be the best option for your employees or business practices. Although English-speaking employees may have adequate language skills to help non- English speakers through day-to-day activities, they may lack the training to ensure that instructions are properly understood.

Multilingual Manuals. In addition to a safety-training program, it's wise to put your procedures in writing. Multilingual safety manuals reinforce safety awareness, outline important procedures, and benefit employer/employee relations. Companies that make an effort to cross language barriers may promote employee satisfaction and possibly reduce turnover.

Steps for Success

Creating a healthy, safe, and inclusive environment is a challenge shared by many business owners. However, meeting the needs of your employees, especially the vital concern of language differences, can contribute to your team's success. These suggestions can help make your business a comfortable—and safe—environment for all employees.

Childcare: not just a family affair


Business News Image 2Family responsibilities don't disappear when working parents leave home and head for work. Childcare, in particular, is a workplace concern that could affect an employer's bottom line if employees are unable to find reliable care for their children. When employees feel torn between their work duties and family obligations, productivity may decline, and absentee and accident rates may also increase. The more time and energy employees spend securing proper daycare, the less likely they are to focus when on the job.

Family-Friendly Options for Business Consideration

On-site daycare facilities are not a feasible solution for all employers. However, there are less expensive alternatives business owners could consider when grappling with the issue of childcare, including the following:

  • Provide employees with referrals to childcare resources in the local community by gathering updated information and distributing it to employees in a timely manner. This could be your least expensive option.
  • Offer flexible and part-time work schedules, especially during school hours. Part-time scheduling can allow you to tap into a pool of reliable employees who are unable to work full-time.
  • Offer assistance with childcare costs. This is obviously more expensive than providing flextime, but it could be an option in a flexible benefit plan where employees choose from a menu of benefits.
  • Provide a conveniently located daycare facility, perhaps arranged in conjunction with other employers in the area. Start-up costs could be absorbed by the employer, with employees paying only for the service.

Family structure has changed tremendously in recent years. The need for reliable, affordable childcare can't be ignored. The lost productivity and safety hazards resulting from employees who are unable to focus fully on their jobs could mean substantial costs for an employer. For most businesses, providing family-friendly options in the workplace may mean a more stable and productive workforce with less absenteeism.
 

Copyright © 2011 Liberty Publishing, Inc. All rights reserved.
The content of this newsletter is taken from sources that are believed to be reliable.
However, this newsletter is not intended as a substitute for legal, financial, or professional counsel.

 

 



2205 Point Blvd. Suite 200 | Elgin, IL 60123 | p 847.741.1000 | f 847.428.8857