For many of us in northern Michigan, our small business is our life. As a locally owned company, we understand this and can provide you with the insurance service you need to help move your business forward. We offer policies in the following areas:
The Builders Risk Policy is designed to provide coverage for direct loss or damage from covered causes of loss to buildings and structures under construction. The form applies to new construction as well as to renovations, remodeling and improvements to existing buildings. This is one of two coverage approaches for construction and renovation risks. The other is provided by a variety of Inland Marine coverage forms. While these forms are basically similar to one another, each takes a different approach to providing the coverage. Contact us (link to Contact Us page) to determine which is right for you.
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Almost every business can face a loss due to its owning, renting, using, or loading/unloading a vehicle. Most coverage needs can be handled by a business auto policy (BAP) or similar form. BAPs might cover a variety of operations, including trucking, garaging, public and private transport, and businesses with auto exposures that fall outside the other classes. Coverage is flexible, and it can be purchased as a separate policy or as part of a package of coverage that might also protect buildings and business property (equipment, furniture, etc.). Contact an agent to learn more (link to Contact Us page).
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Business Owners Policy
If you own and/or run a smaller business, your insurance needs might be properly handled by a business owner policy (BOP). BOPs are similar to a homeowners policy, offering both property and liability protection. Businesses such as retailers, wholesalers, small contractors, artisan contractors, dry cleaners, restaurants, offices, and convenience stores (including those with gas pumps) are eligible for BOP coverage. All such operations may be insured by a BOP as long as they are not larger than 25,000 square feet in total floor area or have gross annual sales greater than $3,000,000 (per location). More restrictive guidelines typically apply to businesses that include cooking operations.
BOPs protect buildings as well as other features such as additions (completed or being built), indoor and outdoor fixtures, machinery and equipment, landlord furnishings, and maintenance property (such as mowers, snow blowers, ladders, etc). BOPs also cover outdoor furniture, floor coverings, and appliances used for refrigerating, ventilating, cooking, dishwashing, and laundering. The building coverage also applies to materials, equipment, supplies and temporary structures located near the insured premises.
The policy's protection to business personal property applies whether the property is located inside or immediately outside the covered buildings. Business personal property (such as office equipment, copiers, desks, etc.) includes property you own, lease or control as long as the property is used by the business.
Business owner liability coverage provides comprehensive protection for claims or suits made by other parties. Its liability section covers losses involving injury to other persons or damage to property that belongs to others. It also provides limited protection against personal injury (slander or libel), advertising injury, and losses involving an operation's products or services.
Naturally, there are certain situations that are not covered by a BOP. For instance, there is no coverage for losses involving most vehicles, money and securities, illegal property (contraband), land, water, growing crops or lawns, or watercraft.
A BOP can be supplemented to provide additional protection. Property coverage options include adding insurance for accounts receivable, valuable papers and records, spoilage, etc. Liability coverage can be expanded to handle additional business interests, limited vehicle liability, losses related to personnel situations, liquor liability, and injuries to leased employees. Contact an agent today to review your policy or to discuss the best insurance options for your business.
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A commercial property policy provides coverage for real and personal property that is used in a business. Protecting the insured's real and business personal property must be a primary goal of any commercial insurance program. Regardless of the size of the business, tangible property usually represents a large portion of its total assets. As a result, it should always be reviewed and used for comparison when evaluating any commercial property coverage form. Contact (link to Contact Us page) an agent today to review your policy or to discuss the best insurance options for your business.
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Directors & Officers
If your business is incorporated, does it have a board of directors and corporate officers?
Do you serve on a board of directors?
If the answer is yes to either question, you could be exposed to lawsuits from shareholders. There exists a possibility that the shareholders could sue you, alleging that you committed acts that reduced the corporation's value. Lawsuits might also arise out of employee practices, allegations of conflicting interests, and from providing information to the investing public.
Decisions made by directors and officers impact the viability and value of a corporation. The recent issues of accounting practices, financial reporting, and the use of corporate assets have resulted in an increase of lawsuits being filed against executive boards. Directors and officers (D&O) coverage should be considered a necessity for corporate and non-profit entities. D&O coverage supplements the protection provided by general liability policies since the former responds to legal actions filed by shareholders, customers, scorned merger partners, and creditors.
Corporate directors must take steps to determine whether D&O coverage exists. If D&O coverage is in place, boards should also determine the amount of coverage available for handling defense costs. Any amounts paid for legal costs are subtracted from the overall policy limits and are not a separate coverage. Criminal acts are not covered by D&O insurance. However, the cost of providing a legal defense until criminality is determined may be covered. In the past it was common for a director facing a lawsuit to have any related expenses handled by a corporation's operating funds. Today such agreements have little value, especially for operations facing bankruptcy or those that cease operation.
The increase in shareholder lawsuits has created a much tighter market, where one or two key executives typically complete the application. Both the applicant board and the insurance carrier rely upon the accuracy of the information provided by the persons completing the application. A problem arises because of how an insurer relies on the information. Typically, the insurer treats the information given by one or two persons as though it were received by all of the persons on the board. Insurers often either deny coverage or deny claims when there is evidence that the information is inaccurate. In other words, fraud or errors caused by an individual officer or director could eliminate coverage for all other directors and officers.
When coverage is not available or if it is denied, a director or officer may face the financial nightmare of having to handle his or her own legal expenses and costs of an award. Therefore, it is very important to take care that a D&O policy provides the anticipated protection. It is also important that a board takes steps to oversee the application process and to make sure that the provided information is accurate. It might be beneficial to look for D&O coverage that offers separate coverage to directors and officers so innocent parties do not have their protection stripped away due to the deliberate, false actions of others.
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Employment Practices Liability
Hiring and firing practices have become legal minefields that have spurred the development of employment practices liability insurance (EPLI). It’s important that a business has clear policies that are applied consistently to each employee and that directly relate to their job. Do you know what type of decisions could trigger a claim? For example, is it legal to terminate:
- A driver with a bad driving record?
- An employee who is rude to your customers?
- An employee who swears at customers?
The answer is NOT simply “yes.” A business' action will depend upon circumstances such as whether an employee's duties involve driving a company vehicle or directly involves customers and if the company can prove that such behavior fails to meet the applicable job standards.
One key issue is having access to legal counsel that has expertise in this special area of the law. Another key issue is documenting the essential job functions and establishing measurable standards for each position. Use of regular performance reviews and applying the standards equally to each employee is a smart employment practice. The best defense against employment practice claims is to know the law in Michigan or other states where your business operates, and have policies and procedures that meet or exceed their legal standards.
The U.S. Department of Labor offers a Small Business Handbook from their website at http://www.dol.gov. The U.S. Equal Employment Opportunity Commission also offers numerous publications addressing different employment laws from their website at http://www.eeoc.gov. Contacting us (link to Contact Us page) regarding employment practices liability insurance is another avenue to explore.
Policies and premiums for this type of coverage vary tremendously among insurers. Many companies offering the coverage also offer assistance in writing policy and procedure manuals and other ways to reduce the potential for claims involving sexual harassment, wrongful termination, or discrimination. No business is immune from these claims.
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Commercial General Liability
A commercial general liability (CGL) policy is extremely broad in nature. It insures the bodily injury liability and property damage liability exposures of a variety of commercial businesses, enterprises, and ventures. The broad nature of these forms eliminates having to select and group individual or specific hazards, with the resulting potential gaps in coverage.
These policies can be offered on either an occurrence or a claims-made basis, as a single-line policy or combined with one or more other lines of insurance to form a commercial package policy. The basic exposures of the named insured covered by the CGL coverage forms include:
- Ownership, maintenance, or use of the premises
- Operations conducted or performed on or off the premises
- Written contracts and agreements
- Products manufactured, sold, or distributed
- Completed operations
- Personal injury
- Advertising injury
- Medical payments on the premises or at job sites, without regard to fault
Each of these coverage options is subject to certain policy definitions, exclusions, and limitations. We can help walk you through the options and set up the best policy for your business. Call (link to Contact Us page) an agent to get started.
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Much like a business or a homeowner, a nonprofit organization needs to protect its property from loss in a fire, by theft, or from many other hazards. Nonprofits can be lawsuit targets as well. Without insurance, a lawsuit could prove financially devastating. Whether a human services, arts, educational, civic, or other type of nonprofit, an appropriate level of insurance to cover defense costs and damages should be secured to protect your organization.
Some insurers specialize in coverage for nonprofits and may be able to best meet the insurance needs of your organization. Contact an agent to get started.
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Professionals, such as doctors, lawyers and accountants, have long been held highly accountable for the consequences of their decisions. While such professions are still the “Big Three,” there are a growing number of other occupations that represent an exposure to liability loss that requires special protection, including pharmacists, architects, engineers, opticians, beauticians, insurance agents, consultants, and many others.
In most instances, a type of coverage called a commercial general liability (CGL – see above) policy will protect a business against the damage or injury their actions might cause to others. However, this type of policy is designed to handle routine, fairly generic, and low-risk activities. Examples are customers who cut their hands on a sharp edge of an office's reception desk or a customer who is hurt when she collides with a clerk who is stocking a shelf. Much more is at stake with professional activities. Meet with an agent to discuss the level of coverage to best meet your needs.
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In case of the average (smaller) business, the commercial umbrella/excess liability policy is a newer insurance coverage option. Not very long ago, the coverage was considered to be only needed by very large business entities. Today, a different set of circumstances exists. Liability claims and court decisions involving millions of dollars are no longer uncommon; any business can be found legally responsible for this type of judgment.
A commercial umbrella liability policy, increasingly referred to as an excess policy, can provide an additional layer of insurance protection to handle major losses. The coverage form is still not standardized, varying greatly among companies and some jurisdictions can create unique coverage issues. Punitive damages are an example. Some states only permit responsible parties to pay punitive damages; others allow them to be paid by insurers.
Another area of difference is that no policy covers everything; every policy has exclusions.
A business owner might consider an accident that does not involve a fatality to be one that can readily be handled by regular coverage. The reality is that such an accident might result in substantial medical care, lost income, and other expenses. An umbrella liability policy could be the difference between bankruptcy and an on-going business venture. The umbrella policy would take over where the business auto policy stopped, providing defense coverage and additional limits to pay large judgments.
There are no standard umbrella liability policy forms; each company has their own variation. Each form offers different options that can help tailor coverage to specific business needs. One thing to remember is that an umbrella liability policy will not cover everything; there are exclusions in this form as in any other contract of insurance. However, it still represents an excellent method to help shield a business from catastrophic claims. Contact us (link to Contact Us page) to discuss securing this valuable form of liability coverage. It could help preserve your business.
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Workers' compensation and employers liability coverage insures against claims for work-related injuries or diseases suffered by employees that are compensable by statute and/or imposed by law as damages. Voluntary workers' compensation and employers liability coverage might be made effective for workers not subject to a workers' compensation law.
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