I just came across some hard numbers, which are a little surprising to me … Dog bites account for 1/3 of all homeowner insurance claims. (WOW!!) The report states there has been a 2% increase in # of claims, but an 11% increase is dollar amount attached to dog bite claims with the average cost of a claim hitting $37,051. Sheesh … medical costs have skyrocketed as of late, so it makes sense the costs of these claims would rise considerably as well. Last point of note … since 1990, the average cost per claim has risen more than 90% – includes costs, settlements, judgements and jury awards. We could spend hours discussing the various aspects of craziness that have made that last statement true – litigious society, medical cost upheaval, lack of responsibility … however, I am not sure that would really get us anywhere…
So, what can we do … (1) make sure you train your pets – I for one am HORRIBLE at training anything, but thankfully professional trainers are definitely available for hire, (2) keep pets that are jumpy or easily scared away from guests – I am sure we can all recall instances where we have unfairly responded when surprised or scared. It isn’t fair to put one’s pet in that situation either, (3) workplaces that allow dogs or animals on the premises can be even more liable for damages – Business owners, this is a good opportunity to double check your pets on premises policy.
As with most things, prevention and forethought can mitigate a lot of the risk.
Going through the news this morning, I came across another Wells Fargo scandal .. this time with forced placed auto insurance. It seems for whatever reason auto loan borrowers received unwanted auto insurance coverage, unbeknownst to them added to their account by the lender, Wells Fargo. The article continued with an accounting of how many people were affected and how many incurred severe adverse financial consequences (including repossessions) due to higher than agreed upon monthly payments.
This story is just a symptom of a bigger problem … a serious corporate culture problem. As I was thinking about this, I realized that this type of culture problem can occur in any size business, and not just a “corporate” environment. Cultures of greed, short-cuts, shoddy work/processes, & dishonesty can occur anywhere. In addition to being a huge liability risk, it is just poor business practice that can limit overall growth potential.
Years ago, being new to an area I needed an electrician. I called around and found a company that could come install a fan for me at a rental property. We agreed upon a price and got it scheduled. The technician came a little late, which was a bummer but forgivable. But low and behold when I received the invoice, it was well over the agreed upon price. When I called the owner to mention the error, he became a little belligerent and yelled the words I will never forget … “I can charge you whatever I want!” Hmmmm …. In my mind, this is the same issue – just on a much smaller scale.
Culture sets the tone for everything in a business and processes or procedures solidify the culture. For example, a company’s culture is the like the design & architecture plans of a building; the policies, processes & procedures are the actual walls, roof, & building itself … the tangible representation of the vision and just as important as the vision itself
So, how do we fix a systematic problem in any company?
The beauty is … everything is fixable.
I am fascinated by business success. In my estimation success itself is as individual as the individuals which find it… and one can obtain success in a myriad of different ways. Business Acumen, Hard-work, Determination, Talent and Skill, and sometimes sheer Luck – are some of the most common characteristics or propellants of people and organizations to the lofty ranks of Successful.
Millions have studied, pondered and written about what it takes to become successful. I stumbled on an interesting article where a Professor from Vanderbilt University discussed Howard Stern’s success via branding. He highlighted some interesting aspects. Howard Stern is a bit on the excessive side for my tastes, but his achievements have been monumental as he has successfully transitioned from regional shock-jock to powerhouse, national player with an almost cultish following – this is not meant in any way to be derogatory; I have always quite literally been in awe of his brand/business/success.
I hope you enjoy ….
Cyber has been a hot button for some time in the insurance industry. I have talked about it several times via this blog as well. It is easy to become a little desensitized to the entire topic and adopt a laissez-faire attitude … but the reality is …
These attacks are not going away. In fact, they are increasing at an alarming rate.
I just saw an article that stated these types of attacks are up 700% in the UK. It would naturally follow that here in the US, they have increased at a similar staggering rate.
Lloyd’s of London recently published a report about titled, “Closing the Gap – Insuring your Business Against Evolving Cyber Threats” … the key findings are:
Businesses need to be aware of the full costs of a cyber-attack, in particular, the “slow-burn” costs (i.e. those associated with the long-term impacts of a cyber-attack, such as the loss of
competitive advantage and customer churn). When added to immediate costs (i.e. legal and forensic investigation fees, and extortion pay outs), slow burn costs can dramatically
increase the final bill.
The reality is – Insurance is just one facet of good cyber protection … Software/Hardware, Training & Company Policies are all vital to effective cyber defense.
I read a blog entry this morning by M. Scott Ford – Founder & Chief Code Whisperer, Corgibytes, LLC where he points out the error of Homeland Security Secretary Michael Chertoff likening of Digital Attacks to Biological Attacks and urges another mind set.
Like it or not, digital warfare is a part of our new norm. We need to see it for what it is – perpetrated by would be thieves around the globe – usually to pick our pockets. This intent or desire isn’t new just the form of the attempted theft. As such, we shouldn’t cower from or have some primal-fear reaction to this age-old problem, we just need to adjust our mind set.
There are ways to protect and prepare for such violations to mitigate fear, loss and downtime.
How often to you back up your computers? Do you have employees that work from home? Who handles your tech security? What should you do in the event of a breach or ransomware? Have you discussed current threats or phishing scams with employees?
As noted on www.Barkley.com by author Jonathan Crowe most Ransomware is distributed via Phishing and over 30% of those emails are opened. This is a topic that REALLY needs to be discussed on a companywide level for all size companies. Small business seems especially at risk without the larger resources of capital or manpower to focus efforts.
Barkley also has fabulous suggestions for protecting against Phishing:
Most of these are pretty easy to do with a good system in place. Most of it just takes a plan of defense … or an IT Guru/company if you prefer to find someone to do it for you.
We often think of emergency preparation in terms of our families and homes; but preparing your business for emergencies is just as vital.
The Insurance Institute for Business & Home Safety has published a fabulous guide to help get you started thinking and planning. This is definitely worth moving up on your priority list. Click here for the link to the kit.
… the real problem is what is going to replace it? There seems to be major division in the GOP on how to do this. We heard all year that President-Elect Trup was going to repeal and replace the ACA … but we have yet to hear with what?!?!?!
One of the items at the top of the President Elect’s to do list after his Inauguration, is ‘repeal & replace’ ObamaCare. So far we don’t have any specifics about what this really will mean to Americans, but this article has stated what we have been anticipating all along – according to Deborah Kelch of the Insure the Uninsured Project, “California policymakers will need to discuss options for replacing it.” (see How will the Repeal of the ACA affect Californian’s healthcare coverage? from California Healthline)
It will be interesting top see how CA will end up paying for it and if it means an expansion of the Medi-Cal program.
As always, we will keep you updated.
Marijuana has been on my mind for the last couple of weeks…. And NO, not for the reason you are thinking. I have read multiple stories over the last several years from CO, OR and WA discussing aspects of the first several months after those states legalized recreational use. There was quite a spike at first (as one would expect) and businesses/municipalities were not entirely ready for the intended or unintended consequences. One story chronicled a business traveler’s escapades while at a trade show in CO. The story wasn’t salacious per se; However, it did highlight a current concern for businesses effected.
Now, it is our turn. The recent legalization of Marijuana in CA brings a heightened responsibility of employers in our state to make sure they have a concise drug and alcohol policy and fair procedure for dealing with potential infractions. The safety of your employees, your business and potentially the general public is at stake. While it may not be feasible to discipline an employee for any evidence of use – what they do on their own time is still up to them – you still have the right and responsibility to a drug & alcohol free workplace.
As with any policy it must be enforced uniformly and should not be used to unfairly target anyone or you run the risk of potential employee-employer litigation. Such litigation could be costly as most employers are reticent to purchase insurance coverage for these types of suits.
So, if you haven’t looked over your drug & alcohol policy is a while take a fresh look. Make sure you are taking good care of your business.
For additional insight … check out Business Insurance’s article
Let me start by saying my heart and prayers go out to the families and friends that lost loved one in this tragic event. I hope they can find peace and be comforted through this terrible time.
I don’t want to dwell on this or point the finger of blame. I admit that I don’t know enough of the facts to pass judgement, nor do I think the detectives have the full story yet either. Although, I do want to spread a word of caution to business owners and landlords – especially Commercial Landlords.
Early reports state the owner leased this property to an individual that seems to have sublet it out as residences, art studios and event hall. The legality of all of this will be a topic of much debate in the near future and I foresee the owner’s insurance Carrier already mounting forces to distance itself from the claim due to the illegal occupancies. Whether the landlord was aware of this or not should determine the extent of his/her culpability.
However, I want to focus on the moral and ethical responsibility of landlords to insure their properties are safe. These Many of these are no brainers and take more effort than money:
I guess my main point is really to stress being actively engaged and aware. Insurance policies are bound and put in place to insulate against risk, but that doesn’t let us off the hook of responsibility if we are found wanting. Carriers have insulated themselves through the policies as well and are very specific about what they will and will not cover – often denying coverage in the event of illegal property use, lack of safety standards/willful ignorance of building code standards.
Be safe. Be smart.
(Photo credit – CNN – Allen Weddington)