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Contractors: Time for an Insurance Checkup

As Spring begins to bloom, many contractors come out of hibernation. It’s time now for potential customers to start building, trimming, cleaning, mowing, moving, etc. The phone is about to start ringing again. If your business is just starting to gear up again after a long winter’s nap, now is the time to review your business and your insurance coverage. Are you ready for Spring? Has Your Coverage Lapsed? During the lean months of winter, some contractors find their income from the heavy months wasn’t able to sustain times of no work. If you failed to pay your insurance premium, your policy may have lapsed, meaning you have no insurance at this time. Lack of general liability or workers compensation insurance could put you in jeopardy with general contractors, municipalities, and state agencies that require coverage to get, keep and use your business license. Lack of auto liability insurance could risk your driver’s license. Pull out your policies, dust them off, and call your insurance broker to make sure coverage is still in place and valid. When you make that call, go ahead and schedule an appointment for a risk management analysis to review current coverage and see if there is anything else you might need. Check Your Equipment We know you’d never leave for a job site without the proper tools for the job. Have you purchased any new equipment? Are you planning to lease any equipment over the next several months? Review the scheduled equipment on your inland marine policy and compare it to your current tools on hand to be sure they match. If items need...

Protect Yours: Wrecking Room Insurance

The world these days is steeped in stress. If essential oils and meditation don’t work, perhaps it’s time for a Wrecking Room? These rooms are popping up all over the country and go by many names including wrecking room, rage room, and demolition room. The premise is simple: grab a tool and take out your stress, rage, anger and/or frustration on everything from old cars to computers. These rooms have been somewhat difficult to insure, since the concept is new (and a little strange). However, Hayes Brokers now has a national program aimed at insuring these businesses. Even if your wrecking room is located in an office building, a standard office policy isn’t going to work for you. Here are some things to know about wrecking room insurance: Premises Liability Insurance Waivers are no guarantee that you won’t be sued in the event of an accident on your premises, but you should require waivers from all participants using your tools and equipment. General liability insurance for your premises is the most important coverage you should purchase for your business. General Liability insurance protects against slip-and-fall injuries on premises, as well as advertising injuries, products and completed operations claims and more. Be sure that your broker is properly insuring your business. If you are purchasing an office package policy for this type of business, you may find yourself without liability coverage in the event of a claim. Most general liability policies may have a classification limitation that excludes coverage for any activities that are not specified in the policy. Property Insurance While much of the property your business owns may...

Employment Practices Liability Insurance

Employment Practices Liability Insurance Frequently Asked Questions Employees are typically the single largest expense to a business year after year. Salary, benefits, and training all contribute to the cost per employee. Employees and potential employees can cost your business in other ways. Harassment lawsuits, racial or sexual discrimination and other employment-related causes of action can cost your business money in legal fees and claims payouts. The best way to protect your business is to purchase Employment Practices Liability Insurance (EPLI). Here are some frequently asked questions about this coverage: Isn’t EPLI included in my Commercial General Liability (CGL) insurance policy? This coverage is NOT usually included in your CGL policy. It would need to be added as part of a package policy or purchased as a stand-alone coverage. If you are unsure, check your policy and then talk to your broker. What does EPLI cover? EPLI policies are tailored to fit your business and may include coverage for harassment, discrimination, wrongful termination, breach of contract, failure to employ, failure to promote, violation of civil rights laws and more. See our document titled “SUMMARY OF EPLI (EMPLOYMENT PRACTICES LIABILITY INS.) RISKS” for a more comprehensive list. Does my business need EPLI? Any company that has employees or plans to hire employees needs EPLI coverage. Even if you only employ family members, or you haven’t hired your first employee yet, you should have this coverage in place. Allegations of misconduct or discrimination can come from anyone at any time, even during the interview or hiring process. EPLI claims and lawsuits can be expensive and time-consuming. Even with little or no indemnity...

Homeowners Insurance: Up in Flames?

As every homeowner knows, “wildfire season” can happen at any time of year. As long as it’s dry enough and there is enough tinder around, sparks may fly. There are many resources out there that explain how to protect your property from a wildfire, but they don’t always work. If you’re out of town or unaware of a fire nearby, you can get caught without proper protection. One seemingly sure thing is to purchase homeowners or renters insurance for your property. Once you purchase a policy you’ll be covered in the event of a fire, right? Well, maybe not. Here are some ways to protect your property with insurance during wildfire season. Don’t Set It And Forget It An automatic insurance renewal every year can take the hassle out of shopping insurance or guarantee you have coverage. You just continue to pay the premiums and if something goes wrong you’ll have coverage. Ask yourself these questions: In the event of a catastrophe: Will you have the right insurance coverage? Will you have enough insurance coverage? There are a couple of ways you can find out the answers to these questions: hope for the best when a claim occurs, or review your policies at the next available opportunity and talk to your insurance broker. We vote that you talk to your insurance broker! Your insurance broker can review your coverage and review your home, personal property and financial situation with you to determine whether the coverage you have is the right kind of coverage and enough coverage to replace your property should the unthinkable happen. Document, Document, Document In a...

Get Your Cannabis Surety Bonds & Letters of Intent Here!

Breaking News! After nearly 2 months on the books, the Bureau of Cannabis Control (BCC) has finalized regulations that would allow for the issuance of licenses under the Adult Use of Marijuana Act. Among the hold-ups was the requirement that licensees have a $5,000 bond. It was unclear what type of bond this should be, and how to apply for one. Good news! Hayes Brokers is now able to secure these surety bonds for those wishing to be licensed with BCC in the State of California. These surety bonds must be a minimum of $5,000. The cost of this bond varies depending on credit, so those wishing to be licensed will need to complete an application and underwriting to get this bond. Hayes Brokers has the application and the forms you need to secure this surety bond. In addition to surety bonds, prospective licensees may be required to provide a Letter of Intent from an insurance broker or insurer to prove that he or she can comply with the insurance requirements of the Act. Hayes Brokers has been and will continue to provide Letters of Intent for licensees as necessary. Hayes Brokers can provide insurance services to every facet of the cannabis industry in all states where cannabis is legal. Whether it is medicinal or recreational or both, we have insurance markets available for everything from distributors to growers to dispensaries and more. Whether you need cannabis surety bonds, a Letter of Intent or insurance coverage for your business, we can help. Call Hayes Brokers today at  (800) 869-8643....

Case Study: Cyber Liability Third-Party Data Storage

When it comes to your customer and business data, who can you trust?  There is no question that it is safer to store data offsite than keeping it on your premises. Most businesses lack the capital to privately store data at an alternate location, so they depend on third-party data storage companies. A cannabis dispensary found out the hard way that third-party data storage isn’t always the safest bet. The dispensary contracted their data storage needs through MJ Freeway, a compliance solutions provider that offers point of sale and data storage. Here’s What Happened In November 2016, MJ Freeway experienced several outages. In January 2017, a cyber attack was discovered, and the ensuing investigation into the attack revealed that confidential client data had been breached November 2016. In November 2017, MJ Freeway notified customers via email and an online press release that the data breach had occurred. It took MJ Freeway nearly a year to notify their customers of this breach. In that time, the data may have been disseminated to other parties, though it is unclear whether that has occurred. Why This Is A Problem In the event of a data breach, most states and the federal government require that consumers be notified “as soon as possible” of a data breach, and usually no more than 60 days after the discovery of said breach.  Regulations may also stipulate that if a breach is in excess of $250,000 or exceeds 500,000 customers, website posting and media notification may be used. So this begs the question: was the data breach that large, or was the notification of customers made too...

Trump Administration Reigniting War On Cannabis?

The high times, they are a-changin’. Or perhaps not. In 2014, then-President Obama quietly “ended the war on marijuana” by instructing federal officials to stand down from raiding cannabis operations in those states that had voted for legalization. In December 2015, he also signed a budget bill that included language that all but legalized medical marijuana on the federal level, specifically prohibiting the banning of federal funds being used by veterans for medical marijuana treatment in state-approved programs. That all may be changing. It has recently been reported that Attorney General Jeff Sessions plans to reverse the previous directive, granting the federal government the right to reignite the war on cannabis. Will this have an effect on your business and the cannabis insurance industry? Probably not. Here’s why. States Aren’t Going To Take It In those states where marijuana has been legalized, the industry is big business, creating significant income for business owners and tax coffers. Those states won’t take federal interference lightly. In fact, California Attorney General Xavier Beccera has vowed to “vigorously enforce our state’s laws and protect our state’s interests.” Colorado Attorney General Cynthia Coffman (now a candidate for governor) made similar statements. Also of note: 12-year-old Alexis Bortell is taking on Mr. Sessions. The preteen will have her day in court February 14, suing the federal government for her right to continue to access cannabis treatment for a seizure disorder. Money Talks It was widely reported after the Sessions memo came to light that cannabis industry investors were running scared. Forbes said just the opposite, quoting investors who noted that the directive didn’t really change...

Commercial Lines Insurance Checkup

No matter when your annual insurance policies begin or end, the new calendar year is always a good time for an insurance checkup. Pull out your policies, get your broker on speed dial, and consider these questions: Did You Hire Any New Employees? New employees can affect your insurance policies in many different ways: Workers compensation payroll may be increased, resulting in an increase in premium at audit. Auto insurance: while most new employees don’t affect your insurance premium, a new driver with a questionable or bad driving record could increase your premium or put your coverage in jeopardy. All new employees should be added as drivers to your policy upon hire, even if you don’t think they will be driving. General Liability: more employees means more work completed, which could result in more revenue. This could increase your premium at audit. Did You Move? If your office moved, did you inform your broker or insurance company? A larger or smaller premises may affect your liability insurance premium. The materials and construction of your office structure have an effect on your insurance premium, so it is important to inform your broker if you have moved. Real property coverage is not transferable so if the wrong location address is on your property insurance policy you may be paying for coverage on a building and business personal property that will not be valid in the event of a claim. Flood insurance is also not transferable, so you will need to cancel your old policy and purchase new coverage on the current location. Other types of nontransferrable coverage include boiler and machinery...

Personal Lines Insurance Checkup

It’s that time of year again when we review how far we’ve come in life and try to determine what the next year will bring. Now is a good time to do an personal lines insurance checkup. Many things may have changed in the past year that could affect your coverage. Here are some questions you should ask yourself: Did You Move? If you were fortunate enough to buy a new home or move to a larger place in the past year, did you remember to bring your insurance coverage with you? Continuing to pay premiums on a policy for a home where you no longer live doesn’t make good financial sense, and will be disappointing in the event of a claim. Check your policies to make sure that they have the right location address and that the amounts of coverage are sufficient to cover both your new home and your personal property. If you purchased new furnishings to go in your new place, will you have enough coverage in the event of a fire or other disaster? While you’re checking, make sure you have flood insurance as part of your portfolio. If you don’t have this coverage, now is the time to call your broker and get it in place. There is a 30-day wait before coverage begins, so don’t delay. Did You Remodel? If you didn’t move, you may have done renovations on your home. That new kitchen, bathroom or den not only looks amazing, but it increases the value of your home. Underinsuring your property can result in coinsurance penalties in the event of a claim....

Can You Get Sexual Harassment Insurance?

It is one of the hottest issues of this news cycle: inappropriate sexual behavior in the workplace. Sports stars, journalists, pastors, actors, directors, producers, government officials and more are being accused on a daily basis of sexual harassment and/or sexual misconduct. The question is, can you get sexual harassment insurance to protect your business from these claims? The answer is yes. It’s Called EPLI Employment Practices Liability Insurance (EPLI) is the type of coverage that protects employers who may find themselves in the midst of sexual harassment allegations, among other things. This coverage is typically purchased as either a stand-alone policy or included with general liability or directors & officers liability packages. EPLI policies can be written to cover a number of potential problem areas including sexual harassment, sexual discrimination, mental anguish, wrongful termination, negligence, whistleblower retaliation and more. It’s Pre-Paid Legal When you read about workplace sexual harassment claims, the legal settlements usually aren’t that large, with many settlements under $100,000. In fact, the Equal Employment Opportunity Commission reports that in Fiscal Year 2016 there were 9,566 claims settled without litigation, resulting in $40,700,000 in claims payments. That’s an average claim payment of just $4,254.65. What that figure doesn’t take into account are those claims that were litigated. Legal fees can dramatically increase the cost of a sexual harassment claim, as well as increase the amount of time involved in fighting a suit. Litigated claims can often also increase the amount of settlement beyond $100,000, in addition to those legal fees. EPLI insurers offer legal representation to their policyholders, in addition to indemnity payouts for settlements or judgments....

California Newly Updated Cannabis Regulations

Recreational cannabis use (also known as adult use) went into effect in California on January 1, 2018. State lawmakers and insurance regulators are still working to hammer out the details of how distribution will be regulated and what insurance will be required. Here is what you need to know with regard to the insurance side at this time (please note that these regulations could change at any time): Bonds An applicant for a distributor license will be required to show proof of surety bond in the amount of at least $5,000 payable to the State of California. This bond is to ensure payment for the destruction of any cannabis goods that may be necessitated by a violation of the Adult Use of Marijuana Act or any regulations adopted thereunder. At this time there is no paperwork associated with this bond requirement or the type of bond required (other than surety). We will advise as soon as this requirement has been finalized. Insurance Per the Bureau of Cannabis Control Emergency Regulation Text, the following insurance will be required for distributor licenses: General Liability: A distributor licensee must maintain at all times a commercial general liability insurance policy in an amount no less than $1,000,000 per occurrence and $2,000,000 in the aggregate. The State of California MUST be named as an additional insured on this policy. The State requires a 10-day notice of cancellation provision. A canceled policy will result in license revocation. Auto Insurance: Any distributor who will be or is distributing cannabis goods must provide to the Bureau of Cannabis Control proof of insurance for each vehicle and trailer...

Hayes Brokers Featured at Cannabis Conference

Left to right: Galen Hayes, Camille Dixon, Susan Etter, Cassia Furman On August 10, 2017, Insurance Business America hosted Cannabis Cover 2017. This conference was dedicated to helping insurance agents, lawmakers and others understand the needs of cannabis businesses as California shifts from medical marijuana to allow for recreational marijuana use in 2018. Galen Hayes of Hayes Brokers spoke at the 9 AM Conference “Cannabis Cover: Current Needs and Future Opportunities.”  Mr. Hayes was asked to discuss current coverage critical needs for insurance in the California cannabis industry before an audience of over 100 attendees. This included insurance agents and brokers, lawmakers, representatives from the California Department of Insurance, lawyers, insurance company owners and representatives. “We believe that this was an opportunity to afford major change to the insurance industry for cannabis businesses in the coming years,” said Mr. Hayes. Other topics discussed included what obstacles there currently are to insuring cannabis operations, as well as the future of insurance and insurers in the coming years, admitted vs. non-admitted markets, and the hopes for the cannabis insurance industry in the future. Hayes wrote the book on insuring cannabis facilities and operations. With more than 20 years experience, you can trust Hayes to help insure your...

Hayes Speaks at El Sobrante Rotary Meeting

Galen Hayes was honored to speak (in costume, this is NOT his normal look) at the monthly meeting of The Rotary Club of El Sobrante – District 5160 on October 31, 2017. Galen spoke on a few of his favorite topics with regard to insurance, including flood insurance, earthquake insurance and fire insurance for homeowners. Flood insurance has been a hot topic this year due to flooding from the recent hurricanes, as well as inclement weather across the country. Recent hurricane losses in Texas, Florida and Puerto Rico are in the hundreds of billions of dollars, though much of it is either uninsured or underinsured. The topic of earthquake insurance touched on the California Earthquake Authority and the lack of insured homes for this coverage.   Fire and homeowners insurance were also discussed, including proper insurance valuation and the possibility that many homes are uninsured.It is estimated that in the recent Napa fires nearly 30% of the 9,000 homes burned were not insured. Galen Hayes is available to speak on a wide variety of insurance topics for both homeowners and business owners. If your organization is looking for an entertaining and knowledgeable speaker, call our office to book Mr. Hayes for your next meeting....

Admitted Insurance Carrier Now Available for California Cannabis Businesses

Admitted Insurance Carrier Now Available for California Cannabis Businesses By: Cindy Ponce November 9, 2017 El Sobrante, CA – For the first time, California cannabis business owners now have an admitted carrier to choose from when insuring their businesses. Golden Bear Insurance Company (AM Best Rating: A-, Excellent) was approved last week by the California Department of Insurance to begin insuring cannabis businesses throughout the state. Golden Bear Insurance Company enters the marketplace as large surplus lines carriers such as Lloyds of London have stopped writing coverage for the cannabis industry. The insurance carrier is now available to insure many types of cannabis enterprises including: Dispensaries/Collectives/Cooperatives Grow Facilities Manufacturers of: Edibles, Creams, Tinctures and Commercial Kitchens Distributors Coverage for businesses will include property, general liability (including assault & battery), products liability, special events, and crime. Cannabis business owners seeking coverage should contact Hayes Insurance Agency to obtain information, applications and quotes. “We are excited to finally be able to offer an admitted carrier to our California cannabis portfolio of clients,” said Galen Hayes, president of Hayes Insurance Agency. Hayes Insurance has been writing insurance for the cannabis industry since 1996. They offer all lines of coverage for recreational and medical marijuana operations in those states where it is legal. Hayes has access to all markets that offer cannabis coverage nationwide. Coverage is available for all types of businesses including delivery services, testing laboratories, doctors and more. Contact To learn more about insurance for the cannabis industry, please contact Galen Hayes (ghayes@hayesbrokers.com) or Cindy Ponce (chodge@hayesbrokers.com) 3550 San Pablo Dam Rd., #C, El Sobrante, CA 94803 Office: (510) 222-8643 Fax:...

When To Call Your Broker About Your Business Insurance

To many business owners, insurance is just a necessary evil. Perhaps your bank requires it, or your landlord, or a vendor or a contractor. You call an agent, get a quote, pay the premium and then get back down to business. While some businesses may be able to get away with this “set it and forget it” mentality, the vast majority of businesses should contact their broker when business changes occur. What sorts of changes should trigger a phone call? Let’s look at a few of them. When Buying or Selling a Vehicle While most commercial auto insurance policies do offer automatic coverage for a newly purchased vehicle, this coverage does have a time limit, usually 30 days or less. You must notify your insurance broker as soon as possible of a newly purchased vehicle to receive an auto insurance ID card. This will be required to register the vehicle and in the event of traffic stops or accidents. When selling a vehicle, you should notify your broker in a timely manner in order to reduce your premium payment. Many insurance companies will not endorse a vehicle off the policy more than 30 days after the sale but will endorse at the date of notification. You could be leaving money on the table by failing to notify your insurance carrier. When Hiring or Firing It is in your best interest to notify your insurance broker of any major changes in payroll resulting from layoffs or hiring. While most Workers Compensation policies are audited annually, a mid-year change would help offset an increase in premium at year-end. When Leasing or...

Three Reasons NOT to Buy Flood Insurance

With all of the horrifying pictures in the news of flooded cities around the country, you might be thinking about flood insurance.  If you have it, do you have enough?  If you don’t have it should you purchase it? Your insurance broker may have tried to sell you a flood insurance policy in the past, but you had a good reason to decline the coverage. After all, who wants to pay for something you don’t really need? That’s probably what all of those businesses in Houston thought, too. Here are some (not so) good excuses for declining to purchase flood insurance. Your Bank Doesn’t Require It Maybe you don’t have a mortgage on your property. Or perhaps, because of location, you aren’t required to have flood insurance to secure or maintain your mortgage. Does that mean you shouldn’t purchase the coverage? While bank flood requirements account for a large portion of flood insurance policies sales, even those without mortgages or those who are not required to purchase coverage should still consider flood insurance policies.  Why?  Because even properties where flood insurance isn’t required are still subject to flooding. If you are in a flood plain (or even if you aren’t) floods may still occur and you could be affected. Your Bank Purchased Flood Coverage “For You” Bank provided insurance (often called force-placed insurance) is when the bank either offers to insure your property or forces the coverage on you because you have failed to provide your own. Some may find this option more convenient than shopping for your own policy, but be warned: force-placed coverage does not benefit you...

Does My Mobile Cannabis Business Need Insurance?

It is a fallacy that many mobile cannabis businesses fall into: if I don’t have a retail location, I don’t need insurance.  The truth is, if you have a business of any type, you need insurance to protect yourself and your investors. No Retail Location? You Still Need Insurance. Many only equate the need for insurance with business locations and landlords. However, if you run your business out of your home you still need insurance coverage.  Why? Because both typical and atypical business pursuits are excluded by your homeowners or renters insurance. Personal lines policies exclude any business done in the home or anywhere on the home premises. The policies exclude the work being done, the work product, employees, inventory and business equipment. Some policies may even cancel coverage for homeowners operating businesses out of their homes. If you are storing stock in your garage or in your spare bedroom, there is no coverage for it in the event of a fire, theft or other hazards. Liability coverage under your homeowners policy also will not extend to business pursuits. There will be no coverage for customers on premises, products liability, or personal or advertising injury, as businesses are excluded from the policy. The good news is both of these coverage lines can be written on your business even if you are operating out of your home. No Commercial Auto? You Still Need Insurance We have previously blogged about the need for commercial insurance for delivery services. The exclusions for livery use of personal vehicles applies whether the car is owned by you, your spouse, or an employee.  The only...

Should You Buy Insurance Online?

You may be tempted by the slogans: “Think of the Savings!” and “Coverage at Your Fingertips, Anytime Day or Night”. Buy insurance in your pajamas? This must be a dream! That dream, however, could turn into a nightmare. After all, you’re not buying a jar of peanut butter, you’re buying a risk management tool in case something bad happens to you. Here’s why you should avoid buying insurance online: No Comparison There are very few insurance aggregator websites out there. If you want the best price, you’ll have to enter your information on a number of websites. Besides the margin for error, you might get finger cramps. And really, who is to say that the best price is really the best price for comparable insurance coverage? All policies are not created equal, so the option with the lowest price may also offer the lease amount of coverage. How can you tell?  By reading and comparing all of the policy documents! Who has time for that? Luckily, an independent insurance broker has the skills and knowledge to not only get quotes from multiple carriers, but also to compare the coverage and help you determine what coverage options are worth the premium. You can’t get that expertise from a machine. No Coverage Advice While some online quoting websites tout “coverage options” what do they really mean? The website is often referring to a list of different endorsements that may be available for the policy you are quoting with pricing options for those endorsements. But what do those options really mean?  The website may give a brief description of what would be...

The Cyber Risk YOU Should Worry About

We have written on this blog many times about the importance of cyber liability insurance for businesses. Even with all of the articles and advice, the coverage still isn’t taken as seriously as other parts of the insurance portfolio. The fact is, you may think that your business isn’t big enough to worry about cyber risk. After all, foreign hackers are more interested in big business. What would they want with your little company? Just as there are large businesses, there are large hackers. And there are small hackers who would be happy to take down even a small business for the potential windfall. The thing that might surprise you isn’t WHO wants to get your data, it’s HOW they are going to get it.  The easiest way?  Through your employees. Accidental: The Lost/Stolen Laptop Your employee stops at the airport bar to have a drink prior to a flight and leaves the laptop on the floor. By the time he realizes it is gone, he’s already in Poughkeepsie and the bag is in Orlando.  Maybe it got turned into the lost and found, but more than likely it didn’t. A lost or stolen laptop for most people and businesses may just be a nuisance. The cost to replace the laptop these days can be minimal, but what about any customer data that may be on the laptop, or proprietary information? In the wrong hands that data can translate to stolen identities and thousands of dollars in lost revenue for your business. Calculate the cost to notify your customers, as well as the cost for credit monitoring and loss...

Cannabis Delivery Using Employee Vehicles

One way to stand out as a cannabis dispensary is to offer delivery service. It can be relatively inexpensive to offer delivery: your employee uses his own vehicle, thus negating the expense of purchasing a delivery vehicle or insurance for said vehicle. Unfortunately, this is incorrect thinking and could lead to high costs for both you and your employee that you may not be aware of.  Here is the danger and how to correct it. But I Have / My Employee Has Insurance! It is always a good idea when hiring a delivery driver to be sure that the employee has a clean driving record, a valid drivers license, and current insurance for that vehicle.  However, be aware that your employee’s insurance is typically going to be a personal auto policy, and as such there may not be coverage for delivery. Most personal auto policies do allow for the incidental business use of personal vehicles titled in the name of an individual. This would include errands, bank runs, etc. However, most personal auto policies exclude coverage for livery services – that is transporting passengers or packages for a fee. This includes flower delivery, pizza delivery and yes, even package services such as cannabis delivery. So if your employee’s personal auto policy doesn’t cover delivery service, then where is the coverage?  That’s right, your business will cover it – even if you don’t have insurance! How Do I Get My Business Covered? If you do not have a business auto policy for your business, and you are relying on your employee’s personal auto policy to cover your business, then both...

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