(800) 869-8643

ghayes@hayesbrokers.com

Insurance for Ax-Throwing Businesses

First, it was rage rooms, and now ax-throwing is the next big thing in relaxation techniques. As these businesses continue to pop up across the country, you may be wondering: where can I get insurance for that? We have the answer: Hayes Brokers. What kind of insurance do you need for an ax-throwing business? It may be similar to more mainstream businesses, but with a twist. Liability Insurance Every business needs liability insurance. This insurance covers everything from slips and falls to property damage caused by your business on your business premises. It covers you for any unintended negligence on the part of your business (such as a fall due to a wet spill) and will even protect you in the event you are sued for something that wasn’t your fault. Additional insured coverage can be added for your landlord, which will be required for any business that leases space from another company. Your landlord or property management company will require this when you sign the lease. Property Insurance While ax-throwing businesses will take every precaution to protect the building and adjacent property from damage, property insurance is still an important part of your insurance portfolio. Property owned by the business, including copiers, wall art, computers, and phone systems should be insured under a property insurance policy. Under a commercial property policy, there would be coverage for fire, theft and other property hazards not necessarily associated with ax-throwing. If you are a tenant, you should also consider tenants improvements and betterments coverage. This covers your business for any special build-outs that may be required for your business to function...

Insurance for Tsunamis

Due to an increase in seismic activity, earthquakes and other underwater events seem to be happening more often. Those earthquakes occurring in the ocean sometimes spawn tsunamis, which can have devastating effects on coastal areas. Is your home or business covered in the event of a tsunami? What is a Tsunami? A tsunami is defined as “a long, high sea wave caused by an earthquake, submarine landslide or other occurrence.” A list of notable tsunamis from around the world throughout history can be found here. While many listed tsunamis have occurred outside the United States, there is a precedent for tsunamis affecting the United States. Earthquakes occurring in the Pacific Rim in 1946 and 1964 caused tsunami damage in Alaska, Washington, Oregon, California, and Hawaii. Recent seismic activity on the Pacific Coast has made residents and the US Geological Survey nervous about future events. Do You Have Tsunami Insurance? It is important to note that most homeowners policies do not cover earthquakes, flooding or tsunamis. These policies must be purchased separately in order to have coverage for these events. Where Can I Get Tsunami Coverage? While your homeowner’s insurance doesn’t cover it, you can get coverage for tsunamis on other policies. Earthquake insurance. Most tsunamis are caused by earthquakes, so it would make sense that there would be coverage under the earthquake policy. However, tsunami coverage is generally a sub-limit of earthquake coverage, and the limit may not be sufficient to cover damage caused by an earthquake-triggered tsunami. It is important to discuss coverage limits with your broker prior to an earthquake or tsunami to determine adequate limits. Flood...

College Students & Insurance

In just a couple of months, your freshly minted high school graduate will be off to college. If your student will be living away from home for college, it is time to start thinking about what insurance coverage they have, and what they will need. For the college student to be covered under your homeowner’s policy the student must be a relative of yours that was a resident of your home before leaving for college, under the age of 26, and enrolled in the college or university full-time.  Property Insurance for College Students If you have homeowners insurance coverage, you may already have property insurance for your college student. However, there may be limitations to that coverage. Most homeowners policies extend coverage to insured property outside the home whether it is in storage or at a college dorm. The limit of this coverage is usually a designated percentage of the covered property, usually around 10%. For example, you have $150,000 in contents coverage on your homeowner’s insurance policy. 10% of that may be designated for off-premises, so your college student would have $15,000 in contents coverage in their college dorm. It’s important to discuss with your insurance broker just how much offsite coverage your policy extends. Then you and your insurance broker need to determine whether that amount is enough to cover all of your student’s belongings including clothing, linens, computers, gaming equipment, etc. Please note that the coverage may extend to the student’s belongings while in the college dorms but it may not cover your student’s belongings if they live in a sorority or fraternity house or in...

Garagekeepers Liability

Towing companies and automotive service stations have a lot of insurance options to think about. From premises liability to workers compensation and even tool coverage, there are several moving parts to keep a business like this properly insured. There is one facet of insurance for these businesses that is often overlooked because it is considered “optional”: Garagekeepers Liability. It can and should be an important part of your insurance portfolio. What Is Garagekeepers Liability? Garagekeepers Liability insurance is liability insurance that protects a customer’s vehicle when you are keeping it at an insured location for parking or storing or to perform service. This means the vehicle is under your care, custody, and control, and that if it is damaged, your business would be responsible. Care, Custody And/Or Control Why is care, custody, and control important? Because in the Garage Coverage Form (CA 00 05) anything under your care, custody, and control is excluded: But I Have Garage Legal Liability… Garage Liability and Garagekeepers Liability are not the same coverage. In terms of auto insurance, think of it this way: Garage Liability is like having liability coverage only on your vehicle. If you get into an accident the other person’s vehicle is covered by your insurance, but yours isn’t. Garagekeepers Liability is like having “full coverage” insurance for your vehicle. For example: A customer brings his vehicle in for service. Your employee does the work and then takes the vehicle out for a test drive. The mechanic is involved in an auto accident. The customer’s vehicle is totaled, as is the vehicle of the other driver. Garage liability would pay...

Case Study: Ransomware and Cyber Extortion

It happened with lightning speed: on May 29, 2019 an employee of the city of Riviera Beach, FL opened an email with an attachment that contained malware. The attachment infected that computer and began rapidly spreading to others within the city’s network. The malware crippled the city’s email system and even affected 911 dispatch operations. The hackers demanded $600,000 in ransom to return the data that had been stolen. What Happened Next? On June 7, 2019 the Riviera Beach city council voted to pay the ransom of $600,000 in bitcoin to have their data returned. To date it is unclear whether this payment will result in the expected outcome.  Has This Happened Before? Cities in North Carolina, California, Florida, Maine and Maryland have been hit this year. The most costly ransomware attack to date happened in March 2018: Atlanta, Georgia was almost completely taken down by hackers who demanded just over $52,000 in ransom. The city estimates it has paid over $17 million to repair the damage caused by the attacks.  Ransomware Isn’t Just For Cities According to the blog Mimecast 92% of organizations experience a ransomware or malware email incident every year. They also report that businesses are down for an average of three (3) days due to ransomware/malware attacks. The cybersecurity firm Sophos reports that the average cyberattack costs a business $133,000. That’s a large pill to swallow for a business that was down for 3 or more days. How To Protect Your Business There are ways to protect your business before and after a cyberattack. Before: Always make sure that cyber security systems are up to...

What is Rigger’s Liability Insurance?

For contractors, the landscape is always changing. Many General Contractors are now using insurance consultants and certificate clearinghouses to verify insurance coverage and endorsements. When third-party insurance administration comes into play, you begin to hear new terms such as “Rigger’s Liability.”  What is Rigger’s Liability? Rigger’s liability insurance is a specific form of insurance coverage for contractors. It is insurance that covers a contractor’s liability that arises out of the movement of property and equipment belonging to others. A common example of this would be a company who lifts air conditioning units by crane to the top of a building. As stated above, this is liability insurance which covers property damage to others, but not property damage to the rigger’s own equipment. Do I Have Rigger’s Liability Coverage? If you regularly use cranes or other equipment to move or haul equipment belonging to others, you probably have rigger’s liability insurance coverage in place. We recommend that you review your policies to be sure, or contact your broker. If moving property or equipment of others in this manner is incidental to your other business activities (meaning it if often unplanned and only happens once in a blue moon) then you may be covered by your Commercial General Liability insurance policy. This is another instance where you should talk to your broker. How Can I Get Rigger’s Liability? If you are in the business of moving the equipment and property of others, then rigger’s liability should be a component of your business insurance portfolio. This can be done as an endorsement on your commercial general liability insurance policy or written as...

Broker of Record / Agent of Record

If you are actively shopping for an insurance policy for your home or business, you may be asked to sign a broker of record or agent of record letter at some point during the process. While it may seem like a small thing, it can affect the quotes you are able to get for insurance. Here’s the scenario:  your insurance renewal just showed up with a huge increase. You decide to shop around and contact a couple of brokers and insurance companies and put them to work getting quotes for you. Suddenly, one or both brokers is telling you they need an agent of record or broker of record letter because “the market is blocked”. Should you sign? What is a Broker/Agent of Record Letter? An Agent of Record (AOR) or Broker of Record (BOR) letter is a document that you must sign that says you are naming an agent or broker as your representative to negotiate coverage and premiums with a particular insurance company. It may include a statement saying that you wish to rescind a certain waiting period (usually 10 days), which means that the agent or broker can receive quotes from the insurance company right away. Why Do You Need an AOR or BOR? Independent brokers and agents are able to access many insurance companies. When you submit an application, your broker will go to all of the available insurance companies that will be most likely to write the insurance for your home or business. Unfortunately, many brokers have access to the same insurance companies. If an insurance company receives more than one application for the...

The Best Way to Shop Your Insurance

If you’re like many businesses, you are looking for ways to cut your expenses. That can mean anything from changing the brand of pens you use to laying off staff. Sometimes the most noticeable increase in expenses comes when your insurance renewal shows up with an increase. The best way to decrease insurance premiums is by shopping your coverage. There are many bad ways to do this, and a really good one. Don’t Shop Online Many insurance companies offer websites where you can complete an online application and receive an instant quote. These may seem like a great idea, but are you getting what you need, or just what you pay for? Sure, shopping your business insurance online at 3 am while eating leftover pizza in your pajamas sounds great now. After completing the fourth online application and receiving a fourth wildly different quote, you may start to feel like this is more trouble that it is worth. In addition, are you really getting the insurance that your business needs? One-size-fits-all insurance coverage is a myth. Every business has different needs and there are probably things your business needs coverage for that the online application isn’t asking about. That is the stuff that won’t be covered. Don’t Go Everywhere Another seemingly good idea is to get a whole bunch of different insurance brokers or insurance companies working on your insurance quotes at the same time. This can also be a lot of work. You may be making a lot of phone calls or insurance agency visits, completing more applications, and fielding a lot more questions and quotes. The good...

June 2019 Cannabis Update: To Shroom or Not To Shroom?

In the last month, two cities have decriminalized magic mushrooms and certain other natural psychedelics. The first to cross the threshold was Denver, in May passing the Denver Psilocybin Mushroom Initiative by a narrow margin. This doesn’t make mushrooms legal in that city but deprioritizes criminal penalties imposed by the City of Denver for possession of psilocybin mushrooms.The second city was Oakland, CA, which took things a step further. The city decriminalized several entheogenic plants, including magic mushrooms and peyote.Expanding into natural psychedelics would seem to be a natural next step for those who own cannabis-related businesses. However, it should be noted first that decriminalization does not legalize these substances, and second that there is likely no coverage under your current insurance policies for these substances.Your business insurance coverage likely contains an “Other Plants and Products Exclusion” that excludes coverage for plants other than cannabis or cannabis related products. The endorsement will look something like this: Please note that the exclusion applies to both the Commercial General Liability coverage form and the Products/Completed Operations Liability coverage parts of the policy.What Are The Consequences?It is important to note that while possession or usage of magic mushrooms and/or other natural hallucinogenics has been decriminalized, they have not been legalized. Dispensaries or other retail establishments may be subject to legal action even within those cities where decriminalization has occurred.In addition, you may lose your insurance coverage. Insurance carriers who discover their insured producing, stocking or selling these substances may choose to cancel your policies outright or nonrenew them upon expiration. Since these substances are still illegal it would be impossible to place coverage with another carrier.Don’t lose your livelihood....

Who Is An Insured?

When purchasing insurance for your business, the application will ask for the name of your company. Typically what you will put there is the company’s corporate name, as well as any “Doing Business As” (dba). That determines the “insured” party on the policy. Did you know that on many policies the “insured” can be more than just the business? In fact, coverage may extend further than you think. It Depends on Your Corporate Structure The typical Commercial General Liability Coverage Form (CG 00 01) reads as follows: In every instance, the company is covered, as well as the decision makers within the company, depending on the structure. However, they are covered only as it relates to their duties and/or conduct within the operations of the business that is being insured. But Wait, There’s More The CGL policy goes on to state: As with directors, officers and the like, conduct of employees and volunteers must be related to the business in ordered to be covered. In addition, bodily injury or personal advertising injury caused by these individuals to owners, managers, directors, other employees or volunteers is not covered. Any property damage to company owned property by these individuals is also not covered. Anything Else? Actually, yes, there is more. The policy also extends coverage to newly acquired or formed organizations as named insureds, except for these types: A partnership.A joint venture.A limited liability company. These types of companies must be added to the policy right away.  Any other organization will have automatic coverage for up to 90 days from the date it was formed or acquired. No coverage is offered...

Your Guide to Property Claims

We hope it never happens to you, but property claims do happen. Whether it is a break-in, a tornado, or a fire, we’ve got you covered.  If it’s your first claim, you may not know what to do. Luckily your policy gives you a good idea of what your next steps should be, in a section usually titled “Duties In The Event Of Loss Or Damage”. First Things First The first question you need to ask yourself is: “Was a law broken?”  If so, you should immediately contact the police. Whether this was a burglary or a robbery, the police should always be the first call. If no law has been broken, you can move on to the next step. Timing Is Everything As per the Building and Personal Property Coverage Form (CP 00 10): Property damage may be compounded over time due to weather and other factors, so reporting damage in a timely fashion is important. As soon as you are aware of loss or damage to your building or contents, you should notify your broker or your insurance company. The company will need a description of the damage, including how and when it occurred to be sure that the damaged property is covered under your policy. Failure to report property damage or loss in a timely manner could result in reduced claim payments. Then What? Once you have reported the damage or loss to the insurance company, your duties are still not over. The policy states that upon reporting you must: You must protect the property from further damage or loss. Be sure to keep records of...

Your Guide to Liability Claims

After years of faithfully paying your insurance premium, the day has finally come: you’ve got your first claim. This is why you have insurance! However, you’re not sure what to do next. Luckily your policy gives you a good idea of what happens next, in a section usually titled “Duties In The Event Of Occurrence, Offense, Claim Or Suit”. Timing Is Everything The first thing the policy tells you is that the insurance company expects to be notified “as soon as possible of an offense or ‘occurrence’ that may result in a claim”. Even if the injured party hasn’t filed a lawsuit or made a formal claim, if you expect some sort of a claim from the occurrence, you should notify the insurance company right away. Notice is particularly important if you have a claims-made policy, such as directors & officers coverage. You could wait until you receive a demand letter or lawsuit, but depending on the timeliness of the notice, the carrier may be within their rights to refuse to defend the claim. What To Report So what does the insurance company need to know in order to open a claim file?  The policy is very specific about this, as well. The Commercial General Liability Coverage Form (CG 00 01) reads as follows: (Property claims are handled a bit differently and will be discussed in another blog post.) All of the above needs to happen in the event of an occurrence that may become a claim. Should you receive a claim letter, a letter of representation or a lawsuit, the policy advises you to do the following: It...

What Flood Insurance Doesn’t Cover

As most everyone knows, flood insurance is not covered by the typical homeowners or business insurance property policy. The solution for getting flood insurance is usually to obtain a policy through the National Flood Insurance Program (NFIP). NFIP attempted to fill a significant gap in coverage for property owners when property insurance carriers began to exclude flood coverage. Unfortunately, NFIP doesn’t cover everything. It Doesn’t Cover All Flooding NFIP has a specific defintion of a flood. It is as follows: A general and temporary condition of partial or complete inundation of two or more acres of normally dry land area or of two or more properties (one of which is your property) from: a. Overflow of inland or tidal waters b. Unusual and rapid accumulation or runoff of surface waters from any source c. Mudflow. Per this definition, if your bathtub or toilet overflows and makes a mess of your house, there is no coverage under your flood insurance policy. If your washing machine floods the garage while you’re out running errands there is no coverage. This type of water damage may be covered under your homeowners policy, but it depends on the type of damage and how it occurred. Talk to your broker about what types of water damage may be covered by your policy. It Doesn’t Cover Everything You Own The NFIP policies do limit the amount of coverage you can purchase for your home or business. These limits are as follows: TypeBuilding LimitContents LimitOne to Four Family Residential$250,000$100,000Other Residential (Non-Condo)$500,000$100,000Non-Residential Business$500,000$500,000 It is important to note that if the replacement cost of the structure is less...

Five Insurance Basics for Businesses

Whether you are starting a new business, or your company is well-established, protecting that business should be one of your main concerns. Locked doors, security personnel and a well-padded bank account are all nice things to have, but they can only do so much. Business insurance can be a hassle, but at Hayes Brokers we like to do our best to take the sting out of it. Here are the insurance basics for businesses, whether new or old. 1. General Liability A general liability policy should be at the top of the insurance list for any business owner. This policy can cover the business premises, the business operations off premises, and a host of other issues that may crop up related to advertising injury, products and completed operations and more. General liability insurance can cover both personal injury to customers and property damage to their property. Some might even call this policy “prepaid legal” since it will provide legal representation in the event of a claim or lawsuit related to the business operations. 2. Property Insurance Whether you own a building or just the contents, property insurance is a must. Property insurance is versatile enough to cover not only your structure and your company contents, but also business income or business interruption coverage in the event of a loss that leaves your business unable to operate for a period of time. There are many options available with property policies, such as equipment breakdown (boiler & machinery) coverage, ordinance or law, sinkhole collapse and more. Talk to your broker to find out which options are right for your business. 3....

Do You Need Railroad Protective Liability?

In most cases, when a business purchases insurance, the coverage protects that business. If coverage extends to another party, it is often done by endorsement, such as an additional insured form. There is at least one case where this isn’t true: Railroad Protective Liability (RRPL). As the name states, these policies are related to railroads. Coverage is purchased by a contractor but the coverage is for the railroad. What Is Railroad Protective Liability? Railroad Protective Liability insurance is coverage that was designed by railroads and the insurance industry. It protects railroads from liability they incur due to the work of contractors on or near a railroad line or right-of-way. This includes work on or near a train station, the tracks, on land owned by a railroad, and within 50 feet of any railroad property. Do You Already Have RRPL? If you already have Commercial General Liability (CGL) insurance, you may think that it will cover you anywhere you do work. However, work on or near railroads is specifically excluded by excluding contractual liability for anything related to railroads. This is the portion of the Commercial General Liability Coverage Form (CG 00 01 04 13) that relates to insured contracts: What does this mean? If your work contract is with a railroad or includes work on or near railroad property, you have no coverage if the claim is railroad-related. Bottom line: you need RRPL in these situations. What Makes RRPL different? RRPL is a policy that is meant to cover the gaps in the CGL policy relating to railroads. The coverage is typically purchased by the contractor, but the named...

Is It Insured? Pets in the Office

In this world of impossible deadlines and never-ending stress, employers are looking for ways to make the work environment more pleasant for workers. One way that is becoming increasingly common is by allowing pets in the office. A study by Virginia Commonwealth University finds that office dogs actually reduce stress. The question is, what does your insurance say about dogs or other pets in the workplace? Let’s find out. FUN FACT: Take Your Dog To Work Day is an actual holiday! This year it falls on Friday, June 21, 2019. Things To Consider Before allowing dogs in your workplace, there are a few things to consider: Do you own a business that would be affected by dogs? Restaurants and other food-related operations may find themselves up against health violations by having a pet in the workplace.Does your landlord allow animals in the building? Some buildings may prohibit animals of any kind.Are any of your employees allergic to or afraid of certain animals? Assuming you are ok on all of the above, it’s important to make sure that the pet you are bringing in is clean, housebroken and properly trained. Does Your Policy Cover It? Most business insurance applications don’t even ask if you allow animals in the workplace. As it becomes more common, this may change. The Commercial General Liability coverage form (CG 00 01 04 13) does not have a specific exclusion that addresses animals. However, the Insuring Agreement does include this gem: The insurance company asserts they will have “no duty to defend” for any suit against which “this insurance does not apply”. What does that mean...

Insurance for Protest Marches

In the current political climate, it seems there are protest marches every weekend, and sometimes during the week. These may be associated with certain holidays or anniversaries of important dates. The point is, they happen frequently. While some protests are small, unplanned gatherings, marches are a different type of gathering. They often require months of advanced planning, funding, and scheduling. Marches are often required by cities and states to have permits, usually requiring a fee and proof of insurance. So where can you get insurance for protest marches? Hayes Brokers can help you with that. Liability Insurance Most cities and states require organizations to have liability insurance for any organized function being held on public property. When applying for a permit, organizers will receive a packet with information that includes the insurance requirements. These insurance requirements usually include a list of limits for general liability and auto liability, as well as wording that is required for adding the governmental agency and others as additional insured. They may also require a waiver of subrogation or other wording to protect themselves. This insurance may only be required for the day, and depending on the march or activity, a special events policy may work to satisfy the governmental authority and protect the organization in the event of problems during the march. However, standard insurance companies may not be willing to offer one day coverage for events with a history or reputation of problematic, violent or destructive behavior. Don’t Purchase Insurance Online Because of their insurance requirements, many governmental and municipal agencies will offer links to purchase insurance on their websites. Do not...

Cannabis Insurance Get-Started Guide

The new year brings new opportunities in many parts of the country where cannabis has finally been legalized. Whether it was medical, recreational, or both, the ability to legally sell and obtain marijuana has many dreaming of starting new businesses. Finding a location and product suppliers are important. Getting the proper licensing is a must. Learn all you can about the business before you get started. And don’t forget about insurance. Hayes Brokers has been insuring cannabis businesses since 1996, when it all began in California. In fact, we wrote the book on it. Now, we can insure cannabis operations in every state where it is legal. Here’s how we can help you. Liability Insurance for Cannabis Businesses If you own a retail operation such as a dispensary, you’re going to need general liability insurance. Your landlord may require it, but even if you don’t have a landlord, this coverage will protect you in many other ways.   Premises liability will protect against the odd bodily injury (slip and fall) claim made by customers and visitors. It will also protect against property damage claims by those same visitors. This coverage works like prepaid legal. Should someone threaten to sue for bodily injury or property damage, the coverage will provide legal representation for your business. If your business is found liable, the policy will pay the claim (indemnify you) up to the policy limit. This is the most important coverage you can purchase as a business owner. One thing not covered under most standard Commercial General Liability policies for cannabis businesses is products liability insurance. This coverage can and should...

Application Misrepresentation/Fraud

When researching insurance options the most tedious part of the process is filling out application after application after application. Every company seems to have their own form to complete, and no other application will do. Insurance companies require applications to find out all they can about your business operations. They want to know what they are potentially going to cover so that they can rate your risk properly and charge the appropriate amount of premium. They may also choose to decline a business applicant if the type of business is not something they are interested in insuring. Have You Reviewed Your Application? Depending on the size of the application you may have several pages to fill out, and then there is the signature line that comes at the bottom of the last page. It is usually proceeded by a bunch of legal jargon that most people don’t read prior to signing – but they should. This is what it looks like on the Acord 125 Commercial Insurance Application: That’s a lot to read, but it is definitely worth taking a moment to read and discuss with your broker prior to signing. What Constitutes Material Misrepresentation or Fraud? Material misrepresentation or fraud is defined as a misstatement in answer to a question on an application. That question is so important that if it had been answered truthfully, the insurance carrier may have declined coverage or charged a higher premium for the insurance policy issued.  It can be any of a number of things including: Misrepresenting prior loss history to a new insurance carrier.Failing to disclose criminal convictions or bankruptcies.Misrepresenting the...

“Alarming” Things About Insurance

If you have property insurance (and you should) the application may have asked about your security measures. Do you have armed guards? Do you have a sprinkler system? Do you have a burglar alarm system? In some cases your security measures may earn you a discount on your policy premium. However, they probably also include something else: a Protective Safeguards endorsement. What is that, and could it be a problem? Protective Safeguards Endorsement The Protective Safeguards endorsement will look something like this: The premises and building numbers will correspond with the location(s) scheduled on the declarations page of the policy, and each one will have one or more symbols listed next to it, each starting with “P-”. P-1 is an Automatic Sprinkler System P-2 is an Automatic Fire Alarm P-3 is a Security Service that makes hourly rounds P-4 is a Service Contract with a privately owned fire department P-5 is an Automatic Commercial Cooking Exhaust and Extinguishing System P-9 is any other protective system shown and described in the schedule Why List Protective Systems? If you list a protective system on your application, you will most likely receive a discount on your coverage. However, the insurance company will require that the protective system be in complete working order at the time of a loss, otherwise they will not pay on the claim. The endorsement itself includes a provision adding an exclusion to the policy that says if the policyholder knows that the protective system was not working prior to the loss, then there is no coverage. If the protective system fails because it was not properly maintained, there...

See Us On Facebook!