Wednesday, August 31, 2011

Seeing "The Big Picture"

"Put a golf ball under a microscope, and it looks like the surface of the moon."
"Focus on only the car in front of you while you are driving and you are sure to have an accident real soon!"
"Unless you are the lead sled dog, the scenery never changes- all you ever see is a hairy butt!"

Where is this going? Sometimes I worry myself. However, I know this... When we get too close to something, sometimes we lose perspective, and fail to see the "big picture".

I see this many times with my clients and prospectives as well. They get so wrapped up in trying to "save a buck" on insurance expenses that they forget why they buy insurance in the first place- to cover and protect their business in case of a major claim! Don't get me wrong- I have run businesses and am currently helping run one now. I know the importance of keeping expenses in check. However, never at the risk of protecting your employees and your assets!

There is a much more to your risk and insurance plan than "getting the cheapest insurance quote". Here are a few things to consider:
   --Are you listening to your employees, understanding how valuable they really are to your organization? Have you really trained them properly, creating the best "safety culture" you can?

  --How effective is your hiring process in weeding out potential "bad hires"? What are you doing about it?

  --Do you have a workable "return to work" program, and are you using it? How has that "return to work" program (or lack of it) affected your Workers Comp experience mod factor?

  --Do you know that you have ample coverage to protect your P&L, not just you Building, if your building blew away in a storm? Are you covered amply if your business is closed for 3 months? 6 months? Longer?

  --What is the worst disaster that you can think of for your business? Are you covered and prepared to handle this problem?

There are literally endless questions you can ask yourself, but the key is to take a step back and take a look at your business and to focus in a broader perspective about your risk and operational needs. I know how hard you work "in" you business. Today, take some time to work "on" your business and make sure you are comfortable with your overall risk plan.

Let me know what you find.

Bobby Bland PWCA, CIC
Vice President
Commercial Risk Service

Monday, August 29, 2011

Boat Rental Checkout Procedures- Address Lake Conditions

If you rent boats to the public or your customers, you should have a very good checkout procedure in place to educate your boat rental customer and to document that you have reviewed the boat operation, safety features and equipment, and boat navigation with your boat rental customer.


As a marina and resort insurance specialist, I review many checkout procedures for my clients. One thing that is often missing from the checkout procedure is language addressing current lake conditions. Why is this important?

A boat rental customer recently accused one of my clients of renting a boat in unsafe lake conditions. The lake was near flood stage and there was a lot of floating debris in the lake. The rental customer hit something in the lake, most likely a submerged tree, and damaged the lower unit on the boat. Of course, the rental customer was liable for the damage per the boat rental contract but they used the “unsafe lake conditions” argument to try to get out of paying for the damage to the lower unit.

Because of this recent experience, it would be a good idea to add a clause to your boat rental agreement or checkout procedure stating that lake conditions can be unpredictable and can change in an instant due to water current, winds, hail, lightning, high/low water levels, or other weather and water conditions. It is the responsibility of the boat renter to monitor conditions and decide whether they want to rent the boat and the boat renter agrees to hold boat rental company harmless if any damages/injuries occur due to lake and weather conditions. Of course, if the lake is full of floating timber or under threat of approaching severe weather, it is a good idea to stop renting boats until the dangerous conditions are not a threat.

Addressing lake and weather conditions on your boat rental contract or checkout procedure will help to protect against claims related to these issues.





Thursday, August 25, 2011

Workers Face Higher Health Care Costs

According to a new survey by the National Business Group on Health, large U.S. employers are planning to shift higher health care costs to workers next year, thanks largely to cost increases that are more than twice the rate of inflation.

Employers estimate their health care benefit cost will increase an average of 7.2 percent in 2012, which is slightly lower than this year's 7.4 percent average increase. However, it still outpaces economic growth and business conditions, putting many employers in a tough spot.

While employees brace for a bigger share of the benefits tab over the next year, employers look to cost-mitigating strategies like consumer driven health plans, cost sharing and wellness initiatives. The survey also found other changes in benefit programs as various components of the health care reform law take effect.

To help control increases and drive down costs to avoid the "Cadillac" tax, employers are planning to use a wider variety of cost-sharing strategies. More than half of the employers (53 percent) plan to increase the percentage that employees contribute to the premiums, while 39 percent plan to increase in-network deductibles. Twenty-three percent of employers plan to increase out-of-network deductibles, while 22 percent will increase out-of-pocket maximums next year.

The survey was based on responses from 83 of the nation's largest corporations, and was conducted in June 2011.

Wednesday, August 24, 2011

9 Things Employees Want From Their Managers (and 5 things they don't)

Different employees crave different things from their Managers. For example, some employees want a hands-on boss who stops by with a “How are things going?” every couple of hours. Others don’t care to see their boss but once a year at the performance review.

A survey of 5,000 U.S. employees reveals what matters most to workers:

1) Honesty

90% say they want honesty and integrity from their manager. Lies and secrets are the biggest killers to credibility.

2) Fairness

89% want their manager to be fair and to hold all employees accountable to the same standards.

3) Trust

More than 86% want to trust- and be trusted by- their manager.

4) Respect

84% want to respect- and be respected by- their manager.

5) Dependability

81% say they want to be able to count on their manager when needed.

6) Collaboration

77% want to be a part of their manager’s team and be asked to contribute ideas and solutions. Shutting employees out will shut them up- and send them shipping out.

7) Genuineness

76% want their manager to be a genuine person. Employees sometimes spend more time with their boss than with their families- they don’t want a phony.

8) Appreciation

74% want their manager to appreciate them for who they are and what they do. When was the last time you handed out a “Thank You” or “Great job!” to employees?

9) Responsiveness

74% want their manager to listen, understand and respond. Be a sponge, not a brick wall.

5 Things they DON’T NEED from a Manager:


1) Friendship

Only 3% want their manager to be a friend. As in parenting, it’s more important to be a leader, mentor and example than a buddy.

2) Conversation

Only 14% want to have interesting conversations with their manager.

3) TLC

24% say they want their manager to “care for them.” That doesn’t mean you have to be cold and detached, but most employees aren’t looking for a best friend in their boss.

4) Emotional Support

25% want emotional support from their manager. Employees typically look for that among co-workers rather than a boss.

5) Cheerfulness


Only 28% want a cheerful or happy manager. They’d rather respect you than like you.

Comment back and let me know what YOU deem most important in you manager.

Bobby Bland PWCA, CIC
Vice President
Commercial Risk Service



Monday, August 1, 2011

State of the Marina Insurance Marketplace

If you operate a marina in Arkansas, Missouri, Oklahoma, or Kansas, chances are you have had weather-related property damage sometime in the past 3-4 years. This four state region, as well as Tennessee, Kentucky, Alabama, Texas and others have all had significant and damaging weather events such as tornadoes, severe thunderstorm winds, and snow and ice storms. These storm events have wrecked many marinas and caused millions of dollars in damages that insurance companies paid out in the past several years.

This is a real problem in the marina industry because there are a limited number of insurance companies that choose to insure marinas because of the high-risk nature of experiencing catastrophic property damage claims. After the latest round of storms occurring in this region, the insurance companies have started reacting in various ways, which will impact marina operators.

Companies are getting much stricter with their underwriting guidelines and that will start to impact marina operators who have older docks. The underwriting rules are starting to result with increasing deductibles including wind, flood, hail, and collapse due to weight of ice/snow. Some companies are even starting to exclude collapse coverage in certain areas, on older docks, and on all wood frame docks. In addition to the increasing deductibles, we have started seeing increasing rates on docks. Due to the claims history in these regions, other insurance companies are not looking to get into the marina insurance business, which will keep the number of available companies very limited in the near future. Anytime you have a limited marketplace, there are fewer insurance options and that can lead to reduced insurance coverage as well as higher prices.

This can change, of course, if these regions have a couple of years of infrequent claim reports. When that happens, more money is made by the insurance companies leading these companies to relax underwriting rules in an attempt to gain market share and other companies will look to enter the marketplace as well.

What can a marina operator do when the insurance marketplace is so limited? A good risk management program and good dock maintenance program are critical to reducing the risk of property claims. When the marketplace is so limited and underwriting rules so strict, it is very important that efforts are made to reduce the risk of a claim. You definitely want to hire a marina insurance specialist as your agent because your agent can help you with your risk management program.

Doug Timmons, CIC, CMIP
Marina Insurance Specialist
Commercial Risk Service