Recent Commercial Posts
How small businesses can better protect themselves
Even the best-run small businesses face the risk that external factors beyond their control, like a natural disaster, could derail operations.
A recent joint survey conducted by Insureon and Manta revealed that approximately 60% of small business owners don’t have either a formal disaster recovery plan or business interruption insurance, both of which could help them bounce back if an unforeseen event like Hurricane Florence forces their business to temporarily close.
Natural disasters are unpredictable such as the recent wildfires in California are unpredictable. Out-of-control fires in Yosemite threatened the livelihood of small business owners in the hospitality industry, with one innkeeper estimating a loss of at least $20,000. Other local businesses, such as guided tour and day trip operators, faced the possibility of serious financial losses and the need to dip into savings to cover operating expenses.
While a disaster recovery plan won’t completely insulate small businesses from problems caused by Mother Nature, a well-thought-out strategy can help minimize the impact. In addition to purchasing commercial property insurance to help pay for repairs to damaged property, business owners should also consider buying a business interruption insurance policy. Not only can it help expedite recovery from a disaster, it can also minimize a business’ financial losses.
Developing a comprehensive disaster recovery plan
In the event of a natural disaster, small businesses may be forced to temporarily close. Unfortunately, not all businesses are equipped to survive a prolonged shutdown. According to the survey, 31 percent of owners don’t know if their companies would be able to resume operations if they had to close for longer than one month, with an additional 13 percent confident that they would definitely not be able to reopen. However, only 39 percent of small business owners surveyed said they have a formal disaster recovery plan in place.
Disaster recovery plans can help business owners act fast to protect their company’s infrastructure and get the business back up and running as quickly as possible. Some information to consider including in a recovery plan includes:
- A list of key contacts, such as the insurance company, utility companies, suppliers and financial institutions
- A detailed plan of what steps employees should take in the event of an emergency
- A communication plan for notifying customers and vendors of the closure
- Documents and resources that are critical to the business’ operations
To keep everyone in the loop, employers may want to review disaster recovery plans with employees during on-boarding, and hold annual emergency response drills.
Why add business interruption insurance?
Companies face more than just physical damage from natural disasters; they also experience financial losses from being forced to halt operations for a period of time.
While property insurance can pay to repair building damage caused by a wildfire, business interruption insurance covers the potential income lost during a temporary closure. These payout amounts are usually based on income and expense records, so business owners should carefully store copies of these documents in a safe, off-site location.
Business interruption insurance can vary from policy to policy, but typically provides coverage for the following three things:
- Profits an owner would have earned if the business was not forced to close
- Normal operating expenses, including employee wages, taxes and loan payments
- Temporary relocation expenses, such as moving and rent costs
Business interruption insurance usually will not cover costs related to utilities, income that isn’t properly documented and losses caused by a partial closure.
Some policies might not protect against every natural disaster. For example, if events like wildfires are not covered by a proprietor’s property insurance policy, their business interruption policy won’t cover expenses related to wildfires either. For total protection, proprietors should verify with their insurance carriers that their policies cover common natural events that are specific to their geographical vicinity.
Above all, small businesses can best prepare by taking a proactive approach to disaster recovery planning. In the absence of a plan or adequate insurance, small business owners are putting themselves at risk for significant financial losses that could force some to permanently close. With the right combination of preparedness and comprehensive insurance, business owners can ensure they are ready for anything Mother Nature throws their way.
Disaster recovery for agents, brokers & claims professionals
A hurricane is coming. You’ve implemented your business’s emergency preparedness plan. You’ve boarded up your brick-and-mortar location in the storm’s path. You’ve ensured your staff’s safety. You’ve secured your CRM data at an offsite, low-risk location (or in the cloud), and armed your staff with printouts just in case. You’ve mobilized your claims workforce. And you’ve prepared your clients with disaster-specific risk mitigation and claims reporting information.
But are you ready for what comes next?
After a weather-related catastrophe passes, agents, brokers and claims professionals must be prepared to ride out the next storm: the onslaught of claims. In 2017, Hurricane Harvey resulted in nearly 670,000 combined personal and commercial property insurance claims to private insurers, the Texas Windstorm Insurance Association and the Texas Fair Access to Insurance Requirement Plan, according to the Texas Department of Insurance. All those insureds expect a prompt, professional response, and rightfully so.
Here are seven tips to help you get back to business with minimal interruption.
1. Keep an eye on the weather
Large storms seldom follow their forecasted track. Watch for changes in weather patterns and reach out to high-risk insureds — such as large car dealerships or marinas — that might be impacted by a sudden shift in the storm track, so they can relocate their assets if possible and take all necessary precautions.
Then, stay in touch with emergency management officials. To provide timely outreach to your clients, you’ll need to know when roads will re-open and when it will be safe to bring claims representatives into the area.
2. Set up temporary offices
Today, power outages from storms don’t bring businesses to a halt. Wi-Fi hotspots mean your insureds may be able to stay connected with their mobile devices. You should too. For agents and brokers, this may mean working “virtually” — from homes, hotel rooms or coffee shops — rather than finding a temporary brick-and-mortar location. Claims professionals (especially CAT adjusters) are accustomed to finding Wi-Fi hotspots wherever they go so they can determine coverage, assess damages and resolve claims without interruption.
3. Mobilize your claims force
Start to determine how many claims professionals you’ll need on the ground to assess the damage. Know the physical location of CAT adjusters and how to contact and deploy them as needed so they can reach out to your clients and help them calculate property loss and business interruption loss.
4. Determine your priorities
For agents and brokers, making sure your clients are safe and handling their first-notice-of-loss response will be your two biggest business priorities in the immediate aftermath of a storm. Determine what your staff can handle, and what they can’t. Small or mid-sized retail agents or brokers may ask their clients to report claims directly to the carrier. The agent or broker should also understand all their carriers’ documentation and estimate requirements for clients who sustained smaller losses that don’t need to be inspected by the carrier. In any event, the agent or broker will still need to follow up on the progress of all claims.
It’s also important to be aware of carrier binding suspensions, state moratoriums on non-pay and other cancellations, and other guidelines, procedures and processes that might be disrupted by the weather event.
Another option may be to outsource some of those critical business functions to an external vendor that specializes in insurance operations and business process management. If you’re already working with such a vendor, this is a natural next step. If you’re seeking such a vendor, look for one with offshore and on-shore capabilities and practical business continuity plans not tied to a physical location that can help you minimize business interruption.
5. Keep your insureds informed
This is where an agent or broker’s online presence will pay major dividends. Use your website and your social media channels to let your insureds know you’re back in business, who to call, where to submit claims, and how to contact you, your staff and their carrier.
6. Rely on your data
Gather analytics around the property or assets you insure and track the potential loss. For example, if you know you insure 1,000 homeowners who were in the swath of the hurricane, you can calculate the potential impact beforehand, and then re-calculate based on the storm’s actual path. This will give you the data you need to comprehend the number and severity of claims you and your staff may be handling.
7. Plan better the next time
No matter how well you plan, the days after a weather catastrophe will be frenetic. But proper planning will help you ensure business continuity.
I spent 20 years working in carrier claims departments, and have been a part of organizations helping people recover from serious storms since Hurricane Gloria hit New York City in 1985. One of the biggest lessons I’ve learned is that the right time to help in a natural disaster is both before and after.
In the days after Hurricane Harvey, we at ReSource Pro offered our clients help with their priority work, for example. We rerouted our impacted clients’ calls to our on-shore center and handled loss reporting calls, and we followed up with carriers and insureds to confirm adjuster assignments. We leveraged offshore locations to handle first-notice-of-loss data entry for impacted clients.
Although that helped clients after the storm, helping clients prepare for the next storm is just as crucial. That’s why I advise our clients that, when you work with external vendors, ask them to do a portion of work on a regular basis. If you anticipate asking a vendor to handle first-notice-of-loss data entry during a storm, having them do a portion of that work with some frequency during normal business operations ensures a smooth transition — and familiarity — with the work during an emergency.
This will ensure your external strategic partner knows your processes, understands your clients, and is prepared to offer seamless support when catastrophe strikes. You’ll gain a level of confidence in your business partner that will keep your clients satisfied, which in turn will become a key differentiator for your agency or brokerage.
Selecting the Proper Drying Equipment for Commercial Restoration
In May we looked at the different players in the commercial market. This time we will delve into the twisted and somewhat misunderstood world of equipment. Many restorers still use the “WOT” method of equipment selection, as in “Whatever’s On the Truck.”
I want you now to consider the “WHAT” method, as in “Whatever the Project Requires.” Have you ever lost a bid when you were sure you charged less per day for air movers or labor than anyone else? You may have thought someone had the inside track and maybe so, but most likely you lost the bid on the total bottom line, not on just the bid price.
As we discussed, it is the occupant that pays rent to the owner, who then pays the bank and insurance. So if we keep the tenants happy, we have a better chance of keeping everyone pleased. A successful selection of equipment and deployment depends on the parameters of the job not what you have on hand.
So what are the parameters? How do I get to the total bottom line? Once again, Zig Zigler says it the best: “You can get what you want if you just help enough of the right people get what they want.”
We now know who the right people are; we just need to provide them with a finished project with as little cost and interruption to their services as possible. This is what they want.
Imagine a disaster has just struck your business: fire, flood, earthquake, tornado or maybe like me by a little hurricane called Katrina. After making sure everyone is safe, what are your concerns about your business? Can I stay open? Can I get supplies from my vendors? How long will it take to get the place back together? How are we going to pay for it all? Make sure everyone involved is on the same page
Our job is to help answer these questions and provide the best overall solution. This is Bottom Line Drying. What we need to do is combine these concerns and needs with equipment available on the market to produce the best result. The fundamentals of drying dictate that adding energy (heat) to a material while passing the driest available air over its porous surface will invoke evaporation of unwanted moisture from the material and thus the building itself. We call it HAT (Humidity, Airflow and Temperature).
(I like “HATE” better. The E stands for Evaporation, but I don’t want to be the one called out for preaching hate in this day and age. But it is probably OK to HATE water – it doesn’t have much of a lobby in Washington!)
Seriously, let’s look at the parameters individually and deploy equipment accordingly.
The first is, can the business stay open? This is determined by structural integrity: Is it safe for occupancy? Can the occupants vendors supply the occupant with the materials or services needed in order to conduct business on a day to day basis? Is there Business Interruption Insurance?
This is of primary concern, because the occupancy of the building is one of the most important factors when developing an allowable temperature range. If people are going to be in the building shopping, eating or working, then noise and temperature level – as well as equipment visibility – are important considerations. So large equipment located away from customers, with air movers on low, and comfortable temperatures are best. You may even need to constantly relocate air movers for aesthetic reasons.
By the way, a hot-air drying unit works fine here if it is cool and dry outside, or you can use localized or “spot” heating for specific, tough-to-dry materials. If the business will be closed for a few days, we do not have creature comfort or visibility concerns, but we have to check on materials and products in the building before we allow for elevated temperature drying (generally above 80 F). Use the right equipment to suit the project’s needs
The building’s design is the second most important consideration. You must understand, this consists of the building’s construction materials and physical layout as well as the contents. Most building materials have no problems handling temperatures up to 120 degrees and most materials, especially the denser or less permeable, actually dry better in these higher temperatures.
Please be careful on total temperature (air or material), because sprinkler systems are part of many commercial buildings and their heads are designed to rupture on temperature, not from sensing flame, and some are rated as low as 130 degrees. (How good is your liability insurance? Want to find out?)
The contents are a mixed bag of every material you can imagine, and many are sensitive to temperature or even low humidity – operational computers or server rooms are obviously concerned with high temperature, but low humidity may induce static discharges into the system, doing serious damage.
You need to consult with the occupants and building engineer about temperature- or humidity-sensitive items, and get them to sign off on any elevated temperature drying so you will not be held responsible for something you did not know was there.
The layout generally determines air mover placement and quantity, but it also very important to the drying system selection: LGRs, desiccants or heat-based systems. Here, the general guidelines are simple: it is much cheaper to rent one big piece of equipment than many smaller pieces, thus decreasing the bottom line.
This is why many commercial projects that have large common areas or hallways use desiccants or larger trailer-mounted heating systems. But if the layout is one of multiple exterior entrances (1,000- to 3,000-square-foot individual units) like condos or hotel rooms, LGR’s are going to be the fit. Layout also includes site access and power availability, as they are also major determining factors, as well as what equipment happens to be available when you need it (as much as I hate to say it, sometimes “WOT” is all we have to work with).
Then there is the Question of All Questions: “How long is it going to take?” “It will be dry when it’s dry” is true, but that’s not what I mean. Lately, a lot of focus has been on drying as fast as possible, and that is great in the residential or commercial market when the building is unoccupied, but when a commercial customer needs his facility to conduct business, being out of business even for two days can be unacceptable.
Businesses such as restaurants and hotel ballrooms have planned functions. Since Mrs. Jones will probably have only one 50th anniversary party, are you going to tell her she can’t have the party tonight? Many times you can dry the carpet/flooring in several hours, have it safe for the party and start the wall drying after hours, when the guests have left.
In this case, you are going to spend a few more days drying with increased equipment billing and labor hours, but there would be no business interruption payout, again making the bottom line lower. I call this “Ghost Drying” because you are constantly working on the wet structure, but anyone who uses the facility hardly even notices you are there. You have just made the insurance company, the building owner, the occupant, and Mrs. Jones very happy.
The last word in drying is communication: Be sure that when you are bidding on a project that the owner, tenants, insurance folks and all of your people are on the same page. Just because you know the benefits of how you custom tailored this drying project for them does not mean they understand it.
It is important to start every bid submission with a meeting of all concerned and continue with these meetings on a daily basis until the project is complete. This openness in working together as well as showing concern and understanding for all involved will make you a successful Bottom Line Dryer.
Business Owners Find Varied Paths to Recovery Post-Disaster
As small business owners in Hawaii and California clean up following Hurricane Laneand wildfires, they’ll find there’s no one formula for recovery.
The same disaster can devastate businesses in divergent ways – a hurricane might tear the roof off one restaurant, flood another and leave a third with little damage.
Whether a business recovers often depends on how prepared it is, such as whether it has insurance and its computer data is backed up remotely. Owners should also find out what resources are available to them from the government, their communities and other entrepreneurs, says Craig Markovitz, a professor of entrepreneurship at Carnegie Mellon University’s Tepper School of Business. Communication with customers and vendors is also crucial, Markovitz says.
“Let people know you’re going to get back on your feet,” he says. Anything from a sign on a company’s premises to advertising to media coverage will help.
Markovitz also advises owners to rally their entrepreneurial spirit, which helped them succeed in the first place.
Here are the stories of business owners who were able to recover:
OWNER: Patrice Farooq, Cupcake Kitchen Houston
THE DISASTER: Hurricane Harvey, August 2017
When Houston was inundated by over 4 feet of rain in four days, Farooq’s bakery was damaged by water that entered through the roof. She lost appliances including a commercial freezer and all her perishables including eggs and dairy products. Farooq estimates her losses at $30,000, and she was shut for about three weeks.
THE RECOVERY: Even as she was first dealing with the damage, Farooq began using Facebook ads to let customers know she’d be reopening, and to ensure they didn’t forget about her shop.
“I had an idea that the (customer) traffic was not going to be the same and we would run the risk of going out of business,” Farooq says.
Farooq kept advertising after she reopened, and revenue had returned to about 80 percent of pre-Harvey levels by January. But because the neighborhood was still rebuilding, Farooq decided to move the store five miles away, opening in May. Revenue is now 50 percent above the level of before the storm.
OWNER: Nate Stokes, Visiting Angels senior care franchise
THE DISASTER: Tornado; Joplin, Missouri; May 22, 2011
The tornado destroyed Stokes’ cars and his office, which no one was in when the twister hit, and he later learned that his accountant had been killed. Stokes saw the area the next day; it was acres of rubble.
“If you had blindfolded me and brought me there, I wouldn’t have been able to tell you where we were,” he says.
Three of 50 employees had to quit because they lost their homes and needed to focus on rebuilding their lives. Three more were temporarily unable to work. He lost several clients whose homes were destroyed.
THE RECOVERY: Stokes’ church offered him office space, and the Visiting Angels franchise in Tulsa, Oklahoma, lent him a car and computer. About a month after the tornado Stokes found an office 12 miles away, in Carthage, Missouri, but he was unable to replace all his lost equipment and cars until he received insurance money six months later.
It took about a year for Stokes’ business to return to its pre-disaster functioning. He’s still based in Carthage but now has a satellite building in Joplin.
OWNERS: Brent and Juan Reaves, Smokey John’s BBQ restaurant
THE DISASTER: Fire; Dallas; Sept. 9, 2017
Wood stored near a meat smoker caught fire, heavily damaging the kitchen, sending smoke into the entire restaurant. It caused no injuries, but the restaurant had to be gutted.
THE RECOVERY: The brothers, who had several catering gigs on their schedule, realized they could still have money coming in by focusing up that part of their business. They quickly found kitchen space where they could prepare food. And other barbecue purveyors were ready to pitch in when they heard about the fire, Brent Reaves says.
“People started calling us and said, ‘Hey guys, if you need smokers, we can help,”’ Reaves says.
With advertising, the catering business soared, helping fund the restaurant’s reconstruction. The rebuilt Smokey John’s will be 1,000 square feet larger to handle the booming catering business, and the Reaves brothers have set a goal of $1 million in catering revenue this year. They expect to reopen the restaurant in September.
OWNER: Brandon Gaille, Gaille Media, internet marketing agency
THE DISASTER: Hurricane Harvey, August 2017
Gaille’s second-floor office became flooded when nearby Lake Houston overflowed. He and his staffers couldn’t re-enter the building for three months – even after the water receded, it left behind dangerous levels of mold. When Gaille was allowed back in, he had to wear a mask.
THE RECOVERY: Gaille and his two staffers and 10 freelancers were able to keep working because most of their documents and records were stored online and could be accessed remotely. So the company had minimal disruption. But last fall, one of Gaille’s employees asked him to consider making the remote work arrangement permanent.
“I don’t want to go back to the office,” the staffer told Gaille.
The move is saving Gaille thousands of dollars a year in overhead – rent, utilities and commuting costs.
OWNER: Bob Tuck, Mr. Appliance, repair company
THE DISASTER: Hurricane Charley; Port Charlotte, Florida; Aug. 13, 2004
The hurricane hit as Tuck was shifting from being a Maytag appliance retailer and repair shop to a Mr. Appliance franchisee, doing only repairs. Tuck was able to move inventory from the store to a warehouse. It took nearly three days before Tuck could travel to the store because of debris and downed power lines. The store, which still had mock-ups of kitchens with appliances, was almost completely destroyed. But the office with all the company’s records was unscathed, as was the warehouse and his inventory.
THE RECOVERY: When Tuck was able to contact the Mr. Appliance corporate offices, the company offered to help him and the community, and told him it would send water and take over his phone lines and answer his calls.
Tuck didn’t try to find another retail space; over the next four months he sold off his Maytag inventory to homeowners who lost their appliances to the storm.
However, there was little demand for appliance repair and therefore little revenue coming in. Tuck’s insurance policy helped cover his financial losses and he also obtained a Small Business Administration disaster loan.
“It was our only means of survival,” Tuck says.
OWNER: Jeff O’Hara, AlliedPRA, event/conference planning company
THE DISASTER: Hurricane Katrina; New Orleans; Aug. 29, 2005
Physical damage at his company wasn’t an issue for O’Hara; it was the city’s overall devastation that for two years wiped out New Orleans’ tourism and convention industries. O’Hara also lost his house. He had to move away from New Orleans for more than a year, getting part-time jobs in Colorado to support himself.
THE RECOVERY: O’Hara worked the phones while he was away, staying in touch with clients, suppliers and tourism officials. He was working to convince people that despite the widespread belief that the city was in ruins, its most popular tourist areas including the French Quarter were undamaged and ready for visitors.
He also traveled around the country, meeting with clients. Even after moving back he worked side jobs, and in 2007, business began to trickle back in.
But O’Hara and the industry faced more problems – the Great Recession hit, devastating the corporate travel business.
“In all, it took seven years to get back to our previous levels of revenue,” O’Hara says
Asbestos and the Workplace
Non-adherence to OSHA standards could result in larger jury awards against non-compliant companies.
Back in 1972, Congress passed the Occupational Safety and Health Act into law- asbestos risks have beset the industry with decades of health-related liability issues, resulting in ripple effects for insurers. Congress created the Federal Occupational Safe and Health Administration (OSHA), which remains at the forefront of employee safety and has had a significant impact on modern U.S. asbestos litigation.
Beyond the immediate consequences of a regulatory violation, OSHA standards impact today's asbestos litigation in three important ways:
- OSHA violations are often cited by plaintiff's counsel arguing for the imposition of a higher degree of culpability
- OSHA's applicability can allow certain knowledge to be legally imputed to a defendant (irrespective of what the defendant actually knew)
- Because OSHA's regulations control the actions of employers and their employees’ workplace, the adherence or non-adherence to OSHA standards may give rise to arguments for apportioning greater liability to defendants in physical control of the plaintiff's work space.
The current OSHA standard for workplace exposures to asbestos is .1f/cc and has been in effect since 1994.
With Spring Comes Thunderstorms- Are You Ready ?
When lightning strikes near a power line, it increases the electrical current. The extra burst of electricity can lead to computer & appliance damage.
Did you know that 50% of businesses never reopen after a fire or water disaster? SERVPRO of Canton is available 24 hours a day to get YOUR business back up and running, "Like it never even happened."
Thunderstorms are absolutely something to be conscious for. 6.5% of all property claims are due to lightning strikes. Wood and other flammable building materials can easily be ignited when lightning comes in contact or passes through them. In addition, high winds, heavy rain and flooding from a thunderstorm can destroy a business in minutes.
If not prepared for a quick recovery, the lost revenue of your business could mean closure.
That is why SERVPRO has local franchises across the nation. When an emergency situation arises, call one of our highly trained professionals, certified in water, fire and mold clean up and restoration.
SERVPRO of Canton can provide:
- Over 40 years of experience as leading fire and water cleanup and restoration providers.
- There are over 1,500 franchises servicing 48 states.
- More locations for faster responses.
- Quick response time to help ensure the damage is contained and the restoration process begins promptly.
- Large loss capabilities - no fire or water damage is too big.
When the next storm hits Canton, OH, call the professionals at SERVPRO of Canton - 330-966-2377, or Request Help Online.
Also consider joining our Emergency Ready Program and reduce business interruption following a disaster. Call for details.
Is Your Business Ready?
When disaster strikes, getting help is now quicker and easier using the SERVPRO Ready Plan.
The best way to reduce business interruption following a disaster is to PLAN for it NOW.
The statistics uncovered by industry research say as many as 50% of businesses may never recover following a disaster. Of the businesses that survive, the majority had a preparedness plan in place.
SERVPRO's Emergency Ready Profile for YOUR business will minimize business interruption by having an immediate plan of action. With a no cost assessment of your facility, the program's profile includes your emergency contacts, all shut off valves and their locations, priority areas of your facility and more.
The SERVPRO Ready Plan provides solutions in advance of an emergency so that during the emergency you are "Ready for whatever happens."
Your business will receive the benefit of over 40 years of experience in reducing the impact of any natural or man-made disaster. Call now and take the next step in protecting and growing your business.
SERVPRO of Canton - 800-648-1212
And now with the SERVPRO Ready Plan Mobile App, help is at your fingertips. Call now and ask how to get started.
Agents: Watch Word Choice in Claims Letters
The following bullets point out random errors in word choice. You may not lose a client because you make a poor word choice, but you’re not helping the relationship either. Here are several word choice issues to watch for as you phrase your letters:
- “ABC Insurance Company will make no voluntary payment of your claim…” Voluntary?
- "e.g., and i.e.," most people don’t know the difference. Use e.g., when you are giving examples; use i.e., to introduce your thought “in other words.”
- “Exception” and “exclusion” are words that have their own meanings. One adjuster wrote,” the exception that pertains to your loss can be found in your policy and is provided below for your reference. I think the word should be “exclusion.”
Here’s the difference: An insurance policy tells you what is covered.
Exclusions are classes of items that are not covered, such as nuclear war, acts of God, or terrorism. Exceptions are “exclusions to the exclusions, reinstating particular items within a whole category that had been “excluded.” For example, a homeowner’s policy may have an exclusion for all motorized vehicles. The exception to that exclusion might be a lawnmower, because a mower helps service the premises.
- “Said” – Very legalistic: “Said payment would allow you a discount of $300.” Just write, “This payment would allow you a discount of $300.”
- “Regard” and “Regards.” Do not write, “This is in regards to…” Write, “This is in regard to…”
- “Were” and “was.” Take the phrase, “If there were no coverage…” Using “were,” known as the subjunctive mood in English, represents situations contrary to fact.
- “Confirm.” When you confirm a lunch date, you restate your agreement as to the time and place. In insurance, however, it’s common to see a claims letter that starts, “This will confirm my phone call of 4/11/17." But what does “confirm” mean? Is the writer summarizing the previous call? Documenting it? Confirming is something you do to re-check a future date or agreement.
- “Advise.” About 80 percent of the time claims people use “advise,” they just mean “tell” or “inform.” No need to use “advise” in a sentence like, “Let me advise you that it will rain today.” There is no “advice” being given. However, if you write, “Let me advise you to bring your umbrella,” you are using “advise” correctly.
"Your grammar is a reflection of your image. Good or bad, you have made an impression, and like all impressions, you are in total control." -Jeffrey Gitomer
Defending Your Family Business Against Fraud
Fraud can occur anywhere within a company and the right controls can limit its successful execution.
In a study done by the Association of Certified Fraud Examiners (ACFE), the 2016 Global Fraud Study found that "businesses with fewer than 100 employees, which are in many cases family-owned, experience fraud at a rate of 28.8%, compared to the 19.8% experienced by those with more than 10,000 employees."
Smaller business often suffer more from fraudulent activities. It's more difficult to manage the damage it causes in a $5 million company than a $250 million company. This kind of activity also damages the company culture.
The median fraudulent loss suffered by small organizations is the same as large organizations: $150,000. However, while it is the same number, this number takes up a larger percentage of the small business revenue.
Here are 5 ways to defend your small business from fraudulent activities and enforce internal controls:
- Segregate financial duties. Create a three-person system of checks and balances: one person opens the bank statements, one prepares the bank reconciliations, and a third reviews all transactions and canceled checks.
- Stay away from signature stamps. Family and small businesses should require two signatures for any payment over a certain monetary amount.
- Establish routine checks of payroll, supplier and vendor lists by multiple people within the company. The final payroll list should be reviewed by someone other than the person distributing checks and preparing the payroll, and the list of vendors should periodically be checked for unrecognized names.
- Educate employees on financial reporting. To increase levels of security, outsource your financial reporting and ensure someone is monitoring for fraud.
- Every employee — including family members — should understand protocols in a business from expectations to pay rates and benefits. Clear expectations help avoid a power struggle and will clearly define who is double-checking various aspects of the business.
Fraud can happen anywhere. The more you believe it won't happen to your business, the more susceptible you become to it.
Source: 5 Ways to Defend Your Family Business Against Fraud by Bill Kowalski
Hotel Chain Suffers Water Loss: What Will the Carrier Pay?
The extent of the destruction will be the most determining factor when calculating price. Most restoration companies bill by the square foot.
Inside a Property Casualty article discussing property damage repairs and what the carrier will cover in replacement costs, there is a question regarding a water loss at a hotel chain with a replacement cost policy. Read below:
Question: Our insured is a hotel that suffered water damage to some of its rooms. The insured is a franchisee and has an agreement with the hotel chain that requires replacement of damaged decor with current decor; all of the rooms on the same floor must be updated to the current decor. The hotel has a replacement cost policy, but the other furniture was not damaged. The carrier's position is that it is not responsible for the non-damaged rooms. What should the carrier pay?
Answer: This scenario differs from the matching issue, about which we often receive questions. The carrier is correct in not paying to bring all of the rooms up to the current decor. There is no loss or damage to the other rooms, and while the rooms would not match each other, this is not something that would be apparent to guests. Nothing in the self-contained rooms themselves would be mismatched.
If the chain requires franchisees to maintain a uniform look to all rooms on a floor, that falls more under the cost of doing business. If the rooms themselves are not damaged, it is not an insurance matter to bring them up to speed with the other rooms.
If items in the rooms themselves are not matched, that would be a different matter. For instance, if a headboard needed to be replaced on one bed but a matching one could not be found, then both headboards should be replaced.
Does your commercial property have water damage? Call our 24/7 Emergency Service number, 330-966-2377, or ask for help online.
Read more on our Commercial Restoration Services.
Winter is Coming: Prepare Your Business for Winter
A winter storm can bring with it sleet, ice, high winds, and heavy snow, which can result in sudden unexpected commercial property damage.
September has arrived and before we know it so will Halloween, then Thanksgiving, then the holidays. Is your business ready for the frigid temperatures, the heavy snowfall?
According to Leavitt Group's article, Prepare Your Business for Winter Weather, In the past five years, 15 percent of small businesses have experienced damages caused by water and freezing. The average cost of these claims is $17,000.
Leavitt Group also discusses common types of winter-related damages, including:
- Damage to contents, inventory and equipment caused by significant temperature changes.
- Water damage caused by pipes freezing and bursting.
- Wind damage to roofs, buildings and landscape.
- Fire suppression efforts delayed by inaccessible fire hydrants (covered by snow or ice)
- Frozen fire suppression sprinkler pipes, resulting in flooded rooms and malfunction of system.
- Ice damming, resulting in damage to roof and gutters.
- Injury to guests and employees.
- Loss of revenue (business interruption).
Taking preventative actions now while the weather is still warm is incredibly important and could save you business a lot of time and money. Here are some maintenance tips Leavitt Group suggests in preparing your business for winter:
- Drain water from all systems and equipment not needed in winter months, including landscape sprinklers and air conditioning units
- Check for and repair damages to the roof. Make sure roof drains are clear and in good condition. Clear rain gutters to ensure proper drainage and make sure downspouts are intact and draining in areas away from foot traffic
- Inspect the exterior of the building for gaps and seal appropriately to prevent weather and critters from getting inside
- Trim tree branches and lanscape that might come in contact with the building in the event of heavy snowfall and ice accumulation
- Make sure the heating system has enough fuel for unexpected conditions and a back-up in case of emergency
- Maintain a temperature of at least 45 degrees Fahrenheit in unoccupied facilities, attics and basements
- Make arrangements for snow removal with a reputable company before winter starts- don't wait until the storm hits and you are buried under a pile of snow. Discuss snow removal from the roof. To avoid damages from snow removal equipment, mark curbs, fire hydrants, drains, speed bumps and other features that may not be visible under a layer of snow
- Make sure you have sand, ice melt and shovels on hand for winter maintenance that won't be covered by your snow removal contractor
Begin checking off your maintenance needs while the weather still allows for it. Stay tuned for our next blog for commercial property owners, "Developing a Business Continuity Plan for the Winter Weather."
Have questions? Call our office at 800-648-1212 or our 24/7 Emergency Service number at 330-966-2377.
Creating a Killer Facebook Ad Campaign for Your Business
Marketing on Facebook doesn't have to be confusing and intimidating. Here are some things to consider when developing your Facebook Ad campaign, a simple and straightforward strategy that will expose your message to your ideal market and present a relevant message that drives prospects to take action:
- Target your audience. Identify your ideal client, find people who had had “liked” groups related to the subject, target a specific ZIP code or individuals who fall between certain ages. Facebook allows you to filter these and more demographics.
- The ideal budget. Facebook allows you to start your campaign budget at $5. As you progress, so can your investment.
- The perfect Facebook Ad. What should it look like?
- Don't mention pricing. Studies show that ads without price have 10% higher conversion rates.
- Add a face to the ad.
- Choose images that show the desired result of your clients, where they will be after your work.
- Test Red vs. Blue. Studies also show ads with red and blue have 20% higher conversion and click-through rates.
- Use a "call to action" button, such as "Apply Now."
- Where should the clicks go? You do not want to send your prospects to the home page of your website. Direct your traffic to a landing page where they can download a report, where the only action they can take is the next step in the process.
For details and graphics on this subject, click here to read the main article.
Cybercrime From An Insurance Perspective
MyDoom is considered the most expensive virus in the world and in cyber security history, having caused an estimated financial damage of $38.5B.
We've heard the stories. Cyber hacks influencing the presidential election, ransomware attacks across the globe. We might even think the hackers are winning the war- the cyber war, that is.
Insurance Business America discusses this matter with an insurance perspective in a recent article, interviewing James Shaheen, cyber risk practice leader at Integro.
According to Shaheen, with every attack, our cyber security experts learn something new, and counter every attack with a defense. It will take us some time, though, to figure out what we need to implement, where the gaps are in the security, to fully protect our data.
When it comes to insurance, Shaheen believes we are doing well in the protection of Protected Health Information (PHI), Personally Identifiable Information (PII) and the Payment Card Industry (PCI), but the concern is what he calls "second-tier data."
Second-tier data, or trade secrets, is what drives businesses, and is also what is not well protected by insurance from these cyber attacks.
Shaheen claims at Integro this is an issue being addressed and developed. How much would such a development be worth to your business?
To read Insurance Business America's article and for related stories, click here.
Restoring Your Canton, Ohio Commercial Property After A Water Damage Event
Commercial Water Damage Events Present Unique Challenges
Flooding and water damage events at Canton, Ohio commercial properties are often complex with numerous issues that require a knowledgeable and flexible response. Whether we’re dealing with a relatively small water cleanup scenario or a large scale event, we work quickly to assess each unique situation and isolate the damaged area. In many instances, normal operations can continue in a temporary space while we restore your facility.
Restoring Commercial Properties Presents Unique Challenges
Our professionals are trained to be mindful of legal and environmental concerns and strive to fully restore the damaged area while working within your budgetary constraints. We understand that every hour spent cleaning up is an hour of lost revenue and productivity. So when an emergency situation arises in your business, give us a call and we’ll be there fast with the help you need.