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Why Has the Price of D&O Insurance Increased?

Why Has the Price of D&O Insurance Increased?

As a result of the recent recession, it seems that the price of everything went up: gas, groceries, interest rates, you name it. We’re paying more for everything. In this increasingly litigious society, many lines of insurance have increased, but none more than Directors & Officers (D&O) Liability Insurance.  Have you ever wondered why? We did, so we did some checking around to find out why.   Directors & Officers Is Important Coverage D&O is often the most overlooked type of coverage.  Other lines of coverage like liability and property cover tangible things like slips & falls or a building lost in a fire. What does D&O cover?  Decisions. D&O is also called Professional Management Liability because it covers decisions made by board members, company owners and officers, and even upper management.  The decisions of these leaders can make or break the success of a business, but those leaders shouldn’t be held personally responsible for any fiduciary losses.  That is why D&O coverage is so important.   The Mortgage Bubble Burst Between 2008-2010 a number of banks, mortgage loan companies and other lenders were accused of predatory loan practices, leading to what is known as the mortgage or subprime mortgage crisis.  Home buyers were assured that the already high-priced homes they were purchasing would increase in value over time, but they didn’t. In addition, the home buyers themselves were purchasing 100% mortgage loans with poor or no credit and when the job market collapsed they found themselves upside down on their payments.  Those buyers had to default on their loans, causing even more financial upset in the home lending...
3 Best Ways to Reduce Worker Compensation Costs

3 Best Ways to Reduce Worker Compensation Costs

Consider this, in 2011 workers comp benefits payments totaled over $60 billion, yet the total cost to employers was just 1.27% of that amount thanks to insurance coverage. If you have any employees other than yourself, you shouldn’t be without workers compensation insurance. In states like California, businesses are required to have workers comp coverage. But even if your state doesn’t have a mandate, you should have coverage from the array of workers comp scenarios to protect workers from exorbitant hospital bills and your owners from potentially bankrupting legal claims. Workers Comp Insurance Doesn’t Have To Be Costly While workers comp is an essentially unavoidable expense for your business, it doesn’t have to be expensive! There are many small tips you can use – like checking employee references when making a new hire: Are you asking if your potentially new employee has had any repeated on-the-job injuries? Are you regularly spot checking your employees for unsafe work habits or signs of a safety risk? There are also big ways to save on costs, but insurance rates may not necessarily be one of them. Most workers compensation insurance rates are set by the state, and are determined by the class of business. To really save on costs, you should read through the following and learn our 3 best ways to reduce workers compensation costs. 1. Create a Safe Work Environment For Employees Creating a safe work environment can save you the most money by reducing employee on-the-job injury. It also reduces the amount of time employees spend off work due to job-related injuries. Instruct your employees in proper workplace safety....