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Difference Between Commercial Automobiles and Business Automobiles

Bookmark and Share The difference between personal automobiles and business automobiles is the name under which it is titled. If you use your personal automobile in business, the business should have hired and non-owned automobile coverage to cover the business' liability of your driving.

If the business owns the car, you should either have a personal automobile policy or a "drive other cars" endorsement on the business policy to cover your liability for driving a company car. The car owner and driver are often both sued.

So, what's the difference between Commercial Automobile and Business Automobile? Commercial automobile coverage includes several policy forms. Garage, business auto, and motor carrier are each forms of commercial auto.

Business automobiles are cars, pick-ups, small trucks, large trucks, dump trucks, even ambulances can be on the fleet list. Business automobile is for standard usage owned vehicles for businesses. Garage forms are used for public repair shops, dealerships, attended parking lots, any other situation where the general public might drive the business vehicle or you have care, custody or control over other people's vehicles. The risk is different from business auto because either the cars or drivers do not belong to the same organization. Garage liability also covers towing other vehicles. The garage form, simply stated, anticipates the owner of the vehicle and the operator will be different people on a regular basis, as part of the business.

Motor carrier forms anticipate different ownership of either the power unit or the trailer it hauls. The nature of long haul trucking is independent contractors "owner operators" hook to other business' trailers and move them from one spot to another.

Motor carrier coverage is designed to cover the nuances of the independent operator system. Long-haul trucking has different exposures than the average salesman's vehicle, and needs different coverage.

Of course, these commercial forms can confuse. Please call us today to assure you are covered properly. We appreciate your business.

D&O Insurance - Protect Your Key People

Bookmark and Share In today's increasingly complex and litigious business environment, your corporate officers and board of directors - the brains of the company - need protection against personal financial liability arising from their corporate activities.

These people are highly vulnerable to lawsuits by investors, employees, vendors, competitors, customers, regulators and others, alleging misconduct for a wide variety of activities, such as:
  • Providing inaccurate or unlawful advice.
  • Fraud and malfeasance.
  • Misrepresentation of company assets.
  • Failure to comply with workplace laws.
  • Poor hiring decisions. (A Towers Perrin survey found that 40% of all reported D&O claims involved flawed employment practices.)
Directors & Officers Liability (D&O) Insurance will pick up the tab for legal fees, settlements, and other expenses from such litigation. This gives your officers and directors financial peace of mind in carrying out their corporate activities, and provides a valuable incentive for attracting, and keeping quality people who can help grow your business.

There's a widespread need for this coverage. One in six company executives (17%) surveyed by Inc. Magazine believe that their business will experience a D&O-related loss within the next year.

These policies usually offer two types of coverage known as "sides." Side A protects directors and officers from personal financial liability if the company is unable to indemnify them. (For example, during a bankruptcy or dissolution.) Side B coverage reimburses the company if it indemnifies directors and officers. (For example, when shareholders file suit against them.) A third coverage - sometimes known as Side C - comes into play when both the company and individual officers and directors face lawsuits.

To learn more about how D&O Insurance can help minimize the financial risks of litigation for your company and your top people, feel free to get in touch with us at any time.

Professional Liability Coverage

Bookmark and Share What distinguishes products, completed operations and professional liability?

A product is a good sold to consumers. Think about "things" when you think about products. Products liability covers the business which manufactures the product against injuries, illnesses or property damage caused by the product.

Completed operations are usually contracted building services which have a beginning point and an end point, like installing a heating, ventilation and air conditioning (HVAC) system. Since it is part of a greater system of insulation, walls, floors, ceilings and lights, HVAC is not a stand alone product. The outdoor compressor is. The installation is an operation.

Professional liability insurance covers service oriented business: designers, architects, dentists, doctors, or hair stylists. The key distinction is service versus a product or an installation operation.

So, how does this distinction affect claims negotiations?

Professional liability claims imply poor professionalism which directly affects your reputation. The paid claim implies dereliction of duty or incompetence.

The insurance company's response to any claim is a business decision - determine the long-term cost of settling and benefit of not paying the claim, pay accordingly. Your reputation does not fit into this decision matrix.

The buying public saw this decision as a conflict of interest. The insurance company did not have to live with a loss of reputation, the professional did. Now the companies offer this solution:

The professional can veto the claims payment.

If the professional chooses to do so, the insurance company is limited to the agreed upon claim amount as their new maximum limit, including legal and claims costs to that point in time.

An architect, with a $1,000,000 professional liability policy, inspects a property and determines the structure is unsafe for renovation. The contractor talks the owner into going forward anyway. The building collapses. The owner sues the architect for "allowing" the contractor to start work before the structural issues are addressed. The insurance company offers a settlement of $100,000 after spending $25,000 on legal fees.

The architect can either endorse the settlement and pay the client or he can refuse, but now his coverage limit drops to $125,000 inclusive of legal fees. It is a much more difficult reputation decision than a business decision.

Retail Businesses - High Risk for Cyber Attack

Bookmark and Share Retail businesses are in the cross hairs of hackers, according to a recent report from Trustwave, a provider of data security and payment card compliance solutions to businesses.

Retail businesses - specifically the cardholder data they possess - were the primary target of cyber criminals in 2012, says Trustwave. About 45% of the company's investigations were in the retail sector, followed by food and beverage (24%), and hospitality (9%).

"Cyber could very well be the largest part of the exposure picture for these retail businesses," says John O'Connor, Vice President of Strategic Product & Platform Development for Travelers Insurance. What makes the retail industry so appealing to cyber thieves? The sheer volume of payment cards used in these businesses make them obvious targets. Also, stores are relatively easy targets because they tend to focus primarily on customer service, rather than data security.

Widespread reporting of costly and embarrassing data breaches have made retailers increasingly aware of the exposures they face when storing customers' data and swiping their credit cards.

Although hackers are targeting retailers of all sizes, smaller firms are particularly vulnerable because they often find it more difficult than their larger counterparts to keep their systems secure and to afford the heavy costs of notifying their customers about data breaches.

One insurance agent said, "A lot of these businesses aren't the types that can absorb these costs. A data breach is one of those things they might not think about - but it can shutter their doors if it happens." The good news: our agency can help you protect you against these risks by offer a variety of comprehensive, competitively priced Cyber Liability policies. Just give us a call.