Wednesday, September 4, 2013

No Coverage for Damage To Your Work

Did you know that your Commercial General Liability policy will not cover damage to property on which you are working?  Many businesses who work on customers' property do not know this, and it is often a major surprise at claim time. 

General Liability policies include two exclusions that create this gap:  Damage To Your Work and Damage To Your Product.  They are standard exclusions in just about all GL forms.

Now, while GL policies do exclude coverage for that specific property on which you are working, they will cover resulting damage to surrounding property.  For example, if you are cleaning a carpet and cause damage to it, your policy will not cover it.  If, while cleaning the carpet, you cause a spill which damages surrounding property, then your policy will cover the surrounding property.

Why do insurance companies do this?  Liability insurance is meant to protect you against the sudden and unexpected.  If you have your hands on something, then you should know how to do your work without causing direct damage.  This item is in your "care, custody and control," and you should be able to service it properly.  If you don't, then it's your loss.  If, while working, you accidentally knock over a priceless Ming vase, then the policy will respond.  Damage to the vase is sudden and accidental, and the vase was not in your care, custody and control.

The three C's are pretty big when it comes to Liability insurance.  One way to avoid this coverage gap is to purchase Care, Custody and Control insurance as an endorsement on your GL policy.  CCC, or Voluntary Property Damage, endorsements provide a small amount of coverage for property damaged while you are working on it.  Not all companies offer it, but it is worth considering if you frequently have your hands on other people's property.

Have you been caught in this coverage gap?

Friday, August 16, 2013

Claim Story: $90,000 is a Latte Money!

If you read my infrequent blog entries, you'll know that I write a lot about Privacy Liability exposures.  Here's a note about a recent claim that happened close to home in VA. 

Alice, who owned a coffee shop in VA, was informed by her payment card-processing bank of a potential data breach in her point-of-sale system. A forensics investigation found unintentionally stored credit card numbers. However, the payment card processor demanded indemnification for fines assessed by the credit card companies who alleged a data breach. The payment card processor withdrew $10,000 from the restaurant’s bank account and sued Alice's restaurant for the balance of $80,000.

Privacy Liability policies include coverage for such fines for failure to comply with PCI requirements.  If your company processes credit cards, then this could happen to you.

This claim story was provided by Apogee Insurance Group, our main Professional Liability Broker.  Apogee's site includes other Data Breach/Privacy claims stories like this one.  Read more here.

Tuesday, July 2, 2013

Net Sec and Pri Li

Say What?

Net Sec and Pri Li are two terms that you should be hearing from your Insurance Agent if your company uses the internet and has sensitive data stored on your network (and who doesn't?).

Network Security & Privacy Liability is an important coverage combination.  It protects your company against:

·       Damage to other companies’ networks resulting from transmission of viruses (and the like) from your network

·       Liability from the disclosure of confidential personal information either through a data breach or theft of records

·       Internal expenses to respond to a data breach, i.e. notification of affected parties, investigation of the cause & scope of the breach

In evaluating Privacy Liability coverage, one notable exclusion is misappropriation of trade secrets.  When data is exposed, the policy defines it as “non-public personal information,” i.e. social security numbers, financial information, driver’s license numbers, etc.  If your company has information on customer/partner trade secrets on its servers, and that information is exposed, the policy may not cover liability from that information. 

Very few companies offer coverage for misappropriation of trade secrets.  One carrier offers coverage for an unintentional misappropriation, but that can be tricky.

Read your policy carefully when you get it.

Another aspect of Privacy Liability is protection from Regulatory actions.  Several states (including VA) have privacy notification laws in place.  If a regulatory action is brought against your company for failure to respond or comply with these laws, then Regulatory coverage includes some protection for your defense or costs to comply with Regulatory actions.  Regulatory coverage is usually included as a sublimit. 
As you can see, getting the policy is only half the battle.  Make sure you are familiar with the different coverage conditions as those are the ones that could rise up and bite you in a claim situation.


Friday, June 28, 2013

Construction Safety videos: the Ultimate in Reality TV

If you're a company that builds, repairs, installs or wields a hammer, you always want your employees to be safe on the job.  Builders Mutual Insurance Company’s website has great little videos that you can access on various safety topics, i.e ladder safety, hand tools, lockout/tagout, eye protection, you name it.  You can view these videos free at the following link:

These make for good topics to discuss with employees either at a Toolbox Talk or company-wide Safety meeting.  I hope these will be helpful additions to your safety program.  If you have any questions on workplace safety, Builders Mutual or anything else, please drop me a line!


Saturday, March 16, 2013

Employers, Be Sure To Maintain Your OSHA Logs

Below is a copy and paste from an OSHA article reminding employers to post Injury logs. OSHA is omnipresent, so take a few moments to read the following and put these records together.


OSHA is reminding employers to post OSHA's Form 300A, which summarizes the total number of job-related injuries and illnesses that occurred during 2012 and were logged on OSHA Form 300, Log of Work-Related Injuries and Illnesses. The summary must be posted between Feb. 1 and April 30, 2013, and should be displayed in a common area where notices to employees are usually posted.

Employers with 10 or fewer employees and employers in certain industries are normally exempt from federal OSHA injury and illness recordkeeping and posting requirements. A complete list of exempt industries in the retail, services, finance, insurance and real estate sectors can be found at Read the news release for more information on recordkeeping requirements:

Monday, February 11, 2013

What's your PC?

PC, or Protection Class, is a major factor in the Property rate that you're paying for your Personal and Commercial insurance. ISO (or the Insurance Services Office) evaluates each community's ability to respond, communicate and extinguish fires as quickly as possible. Based on its evaluation, ISO assigns a PC of 1 through 10 based on the proximity of your address to that community.

If your address is within 5 miles of the nearest fire station, then your PC will be a lower number. If you are outside of the 5 mile radius, then your PC will be higher.

When it comes to PC, the higher the number = the higher the Property rate.

Also, you may be within the 5 mile radius, but your nearest fire station may not deliver enough water power to you to put out a major blaze. There are certain areas of Fairfax County, VA that fall into this category.

ISO recently announced that it reevaluated its PC classifications. You can find more information about that here:

Ask your Insurance Agent about your Protection Class and how it affects your rate. If a new fire station recently opened in your area, double check to see if you qualify for a lower PC. ISO can't see everything, and your local knowledge may help you to get a better insurance rate!