Top 5 Insurance Concerns for Business Owners and Contractors in 2019
2018 was an interesting year for business and for insurance! So interesting in fact, that we thought it would be beneficial to write about the top things that concerned us in the insurance industry in 2018 and have provided some insight on how best to protect your business from risk in 2019.
1. Cyber Security – It’s more important than you think. Absolutely no organization is immune to cyber threats. Some experts say it’s a matter of “when” and not “if” you will be the victim of a cyber crime. Please don’t think for a second that because you are a small business, and that technology isn’t a huge part of your day-to-day activities, that it won’t happen to you. Hackers just love to pray on smaller businesses because they typically have a moderate amount of data with minimal security.
The most common cause of data breaches for contractors are lost laptops or other mobile devices, hacked systems, malicious code from an external source, lost or improper disposal of paper records and failure of electronic backup(s). But that is just to name a few, every year hackers get more creative and 2018 was a particularly bad year for cyber attacks.
As a result, Cyber liability insurance has become an essential component to any risk management program. #Cyberliability insurance policies are tailored to meet your company’s specific needs and can offer a number of important benefits. Click here to learn what a Cyber Liability Insurance policy can do to protect your organization.
2. Commercial Auto and Trucking Claims Continue to be on the Rise 2018 was a tough year for commercial auto and trucking claims with every business feeling the increase in their premiums. But, it was also a tough year for insurance carriers that wrote commercial auto coverage because the average pay out is $1.15 for every $1 of premium they take in and there was an increased number of accidents and larger lawsuits in 2018. Increasing medical costs and rising auto repair costs due to technology also contributed to unprofitability for insurance carriers.
Distracted Driving Training and Policies: Many insurance carriers are requiring Distracted Driving Training and Cell Phone Use Policies as this helps with claim reductions and safety. Botson Insurance offers free #DistractedDriving Training and Cell Phone Use guidelines to their clients. Follow this link for more information and sample resources.
3. Audits – Preparation is Key There was an increase in audits in 2018 and that trend is expected to continue because of the unprofitability with Commercial Auto policies. Many insurance carriers are doing insurance audits on an annual basis or at least every 2-3 years. The purpose of an #Audit is to charge the correct premium for the exposure during that term. Good record-keeping is essential to preparing yourself for an audit. Botson Insurance Group works closely with clients to educate them on what they can expect from an Audit and how to keep track of crucial information by using an Audit Checklist.
4. Subcontractors – Their mistakes can be your problem. Claims on contractor policies from errors caused by subcontractors continued to rise in 2018. A proper Subcontractor Insurance Program is suggested to avoid a claim on your policy or money out of your pocket due to a sub-contractors negligence. We also suggest implementing a Subcontractor Management Plan that outlines the relationship between contractors while they are performing work for a certain project, and the methods by which the primary contractor will ensure the production of quality deliverables from each of its subcontractors. In addition, Botson Insurance provides clients with sample Certificate of Insurance letters and #Subcontractor Agreements.
With proper coverage and by implementing our Subcontractor Management Plan, you not only protect your business from liability, but you make yourself organized and audit ready in the process.
5. Sexual Harassment Claims In wake of the #MeToo movement, awareness of sexual harassment has increased, but not necessarily at small businesses. Unlike their larger counterparts, small businesses are more vulnerable to #sexualharassment claims because they’re less likely to have formal workplace policies in place or have an on-staff human resources person. But, even if a business does have a formal policy, it doesn’t mean that it is exempt from liability.
From employee to employer, and employee to a third party, it is important as a business owner to make sure that your business is being protected from what could be a potentially damaging situation. If your current coverage does not include Employment Practice Liability Insurance (EPLI) or a Directors & Officers (D&O) policy, it is definitely something to speak with us here at Botson.