Insurance Consultants of Maine Newsletter
Scott Simmonds, CPCU
October, 2004

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Biggest Business s Insurance Mistakes -- Here's an excerpt from my ebook, "The 20 Biggest Business Insurance Mistakes." Email me at scott@icofmaine.com and I'll send you a free copy of the whole book.

Mistake #9 - Low Umbrella Liability Limits

Umbrella liability insurance provides protection above and beyond what's offered by your general liability, auto liability and employer's liability insurance. It's an inexpensive way to increase your level of protection against someone suing you. Premiums can be as low as $750 per $1,000,000 of coverage.

Consider $1,000,000 a minimum. Think about $2,000,000 or $3,000,000 or more. Review your liability limits compared to your annual sales and total business value. Think of the daily activities of your business and the accidents or losses that can occur.

Recall that most liability policies have total aggregate limits of coverage so you can use up your insurance if you have multiple claims.

Contractors should be careful of their liability limits. Look at the exposure you have to loss. A careless employee with a cigarette burned down a $4,000,000 church in my town a few years ago. It isn't just the big boys who cause big losses!

If you manufacture, bottle or sell booze try to get your liquor liability insurance included in the umbrella coverage.

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Personal Risk Management Tip - Washing Machine Trouble - Replace the water hoses for your washing machine every five years or so. Consider replacing them with stainless steel reinforced hoses. Make sure the hoses don't rub against the wall. Turn the water off when you're away from home for a while. I checked my washing machine hoses a week ago. One had a two inch bubble - just ready to blow! I hate to imagine the mess a broken hose would cause. My cellar would not do well as a lake.

Coverage Hint - Employee Dishonesty - Check your insurance program for employee dishonesty protection. Many insurance buyers have low limits or no coverage at all. Employee dishonesty pays for embezzlement and other dishonest acts by employees. For an act to be covered under standard policy forms there must be theft or destruction of tangible property. Theft of data, customer lists or intellectual property are not a part of most employee crime policies. Check with your agent.

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Terrorism Insurance - Most standard insurance policies now exclude damage caused by terrorism. To get coverage you must buy a special rider or a separate policy. According to one national insurance brokerage house, more insurance buyers than in years past are purchasing coverage as offered under the Terrorism Risk Insurance Act (TRIA) . TRIA coverage is limited to foreign acts of terrorism that are certified by the US government. Coverage is also available in the insurance marketplace for "non-certified" events.

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Cranes, Lifts and Augers - If you have cranes, cherry pickers, lifts or drilling equipment you may not need to pay extra for auto insurance. Such equipment may be covered as mobile equipment in your general liability coverage. If so, you don't have to buy separate auto liability coverage. Such could save you $5,000 per unit! You still need to buy coverage for damage to the unit itself - usually on an equipment policy. Talk to your agent. Better yet, call me.

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Hurricane Losses - Current reports are that the four recent hurricanes on the east coast could result in insurance claims in excess of $22 billion. This is a huge hit for the industry at a time when insurer financials were rebounding to a point that competition was again coming back into the marketplace.

Industry estimates puts the number of adjusters now in Florida at 15,000. Insurers have sent teams from as far away as Canada to help speed claims settlements.

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Your Privacy - I will never sell or distribute your email address to any other person or organization.

Life Insurance - How secure is your life insurance? Do you have the right kind? Is the policy set up correctly? I can help. Call 207.284.0085 or email me at scott@icofmaine.com. Remember, I don't sell insurance so I'm unbiased.

Need A Speaker? I'm pleased to speak to trade, business or service associations about insurance topics. Call 207.284.0085 or email me at scott@icofmaine.com. Also check out my speaker's page at www.icofmaine.com/ispeaker.html.

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Scott Simmonds, CPCU
Insurance Consultants of Maine, Inc.
20 Sofia Road
Saco, ME 04072-9017
Phone 207 284-0085
Fax 801 991-4027
scott@icofmaine.com
http://www.icofmaine.com/

Unbiased Insurance Solutions

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Insurance Consultants of Maine, Inc. is an unbiased, fee-only insurance and risk management advisory firm. We don't sell insurance and never accept fees or commissions from insurance companies or agents.

Comments regarding insurance policies or products in this newsletter are for information purposes only and do not constitute an endorsement. We accept no fees or payments of any kind from any insurance organization or any company mentioned in this newsletter.

© 2004 Insurance Consultants of Maine, Inc. All Rights Reserved. We encourage sharing this newsletter in whole or in part if copyright and attribution (including my web address) are always included.