Employee or claimant fraud accounts for about 20 percent of all workers compensation claims paid.* Protect your company from costly claims by recognizing the following signs of insurance fraud:

• There is no witnesses of the accident or it happened outside normal working hours.
  

• It is difficult or impossible to reach the employee.

• The accident wasn’t reported until days after it happened.

• The employee changes his or her story about the accident.

• The employee shows no interest in returning to work even when accommodations to the injury are made. 

• The employee frequently changes physicians.
  

•  The employee has a past history of workers compensation claims.

In times of economic uncertainty, many employers face the possibility of workforce reductions. Though increases in layoffs could lead to an increase in workers compensation costs, there are preventative measures that can be taken. These include preparation prior to the layoff, appropriate assistance for affected employees, and proper management of records. Careful planning and handling of workforce reductions can help alleviate the problems that may arise and assist employees with the transition to new employment.

Preparation Prior to the Layoff

• Be familiar with state unemployment insurance laws, including the levels and durations of benefits.
• Investigate state programs available to employees that may offset workers compensation costs.
• Meet with your insurance broker to review pending claims and identify those that might become problems. 
• Backup employee records and store them in secure locations. Claim records should be updated with the latest available information.
• Create a video record of conditions in the building prior to the layoff to easily demonstrate to a court what the work environment was like. 
• Use exit interviews to document employees’ physical condition at the time of termination.

Appropriate Assistance for Affected Employees

When layoffs occur, the company should handle them as sensitively as possible. Losing a job is a traumatic experience for anyone. Reduce the chances that a worker will seek retribution by helping affected employees:

• Offer resume preparation or outplacement services. 
• Offer employee assistance programs for those who need emotional support.
• If the company can afford the expense, offer severance payments to the employees in return for their written agreement to forego any future claims against the company. 
• Make sure contingency plans are in place should any of the employees become violent at the time of the layoff or later

Proper Record Management

• Ask the broker and the insurance company to coordinate claims handling through one office and one senior claims adjuster.
• Request that the insurer assign the defense of all cases to one law firm.
• Relevant records should be made easily accessible to the attorneys and any medical specialists the firm may hire. Relevant records include videos, employee files, job descriptions, and exit questionnaires.
• Identify key personnel who may be available to testify regarding job requirements and conditions. Have a list of their names and contact information available for the attorneys.

Employment Practices Liability Insurance, known as EPLI, can protect your business against claims made by potential hires, employees currently on your payroll, and terminated employees.

An EPLI policy will protect your company against claims of:

• Wrongful termination
• Employment-related emotional distress and invasion of privacy
• Defamation
• Retaliatory/constructive discharge
• Sexual harassment and discrimination
• Workplace torts such as slander

EPLI coverage generally includes the cost to defend against the charges plus any damages you are ordered to pay. Depending on your business needs, it might make sense to purchase EPLI coverage as part of your company officers’ liability insurance since company officials can be named in lawsuits against the business.




Risky Business
Why You Need Employment Practices Liability Insurance

Workplace discrimination claims can affect businesses of all types.  For example:

• Thirteen current or former computer company employees claimed employment discrimination on the basis of race and national origin. Employees claimed they were treated unequally and subjected to a hostile work environment.  Amount of settlement: $635,000 (salary increases, enhanced promotional activities).

• Eight employees filed a class action suit alleging sex discrimination by their employer in the handling of wages, promotions, pregnancy leaves, and other conditions of employment. Amount of settlement: $600,000 (plus $5 million in legal fees).

• A senior regional attorney sued a securities dealer claiming age discrimination and retaliation. He claimed he was unfairly terminated for advice he gave to a co-worker regarding his employment rights. Amount of verdict: $443,000.

Up to half of all businesses will face a workplace discrimination lawsuit at some point. Is your business prepared?
Protect Your Business
As an employer, you do everything you can to treat your employees fairly. However, you can be held liable for the actions of your employees or even vendors and customers. And with new employment-related regulations being added to the books frequently, it can be difficult to understand exactly what you are expected to do.

It is important to make sure you remain in compliance with laws governing treatment of employees. But there is an added layer of protection you can obtain: Employment Practices Liability Insurance, or EPLI.

Are all your eggs in one basket?

While diversity may be the way to go when investing, it is not necessarily the most practical course of action when buying commercial property and casualty insurance.

The following is from firms who have combined multiple lines of insurance with one commercial carrier:
• 89 percent of the firms who saw savings were able to cut the overall cost of their risk management program by a minimum of 4 percent.
• Approximately 35 percent realized savings of 7 to 10 percent.

By combining all of your commercial insurance with one company, you receive a more cost-effective policy than if you were to purchase each product individually from different companies. Not only is it a matter of cost savings and convenience, but having your coverage with one company can also simplify the claims process should a loss occur. So, unlike an investment portfolio where it is better to spread the risk around, your commercial insurance policies are most effective when you keep them all in the same place. If some of your policies are not combined, work with your independent agent to evaluate all of your exposures and the most effective company for your business insurance needs.

FIVE Ways to Control Workers Compensation Costs

Workers compensation is essential to protect your employees and your company. To sharpen your company’s competitive edge, it’s important to control costs. By taking a fresh look at your company’s approach to safety, hiring, classification, and claims management, you may find new ways to keep costs under control. Here are some tips:

1. Thoroughly train new employees:
Nearly a third of workers compensation claims result from accidents with new employees. Evaluate your orientation program for ways to improve new employee training.

2. Make safety a top priority:
The best way to keep costs down is to not incur claims. Create a safety culture throughout the company, and engage employees directly in the effort. Solicit ideas from employees on how to create a safer workplace.

3. Pre-screen employees:
An investment in pre-employment drug screening can save a significant amount in claims down the road. Statistics show that workers who are substance abusers are far more likely to have an on-the-job accident.

4. Manage claims proactively:
Monitor an injured worker’s condition so they can return to work as quickly as possible. If an injured employee rejoins your workforce on light duty, you can reduce the claim amount.

5. Make sure employees are classified properly:
If employees are misclassified, you may not have the coverage you need, which can result in large audits.

Four Golden Rules to Buying Auto Insurance

Simplify the insurance selection process and ensure you have adequate coverage with these tips:

      1.  Consider higher limits of coverage than the state-required limits.  If you choose the minimum coverage required by your state, you may not be fully covered in an accident.  For example, if your property damage coverage is $15,000 and you cause $25,000 worth of damage, you’ll have to pay the remaining $10,000 out of your own wallet.

     2.  Tell it like it is. Be completely up-front and honest about your driving history. If you fail to disclose past accidents, speeding tickets, or other moving violations, the insurance company will not be able to give you an accurate quote.  As soon as the insurance company checks your driving record, they will adjust the price to reflect your violations.

     3.  Pay attention to the total package.  Consider price, coverage, convenience, and customer service.  Decide what’s most important to you, and communicate this with your insurance agent so they can help you choose the company that is right for you. 

    4.  Don’t double up on coverage.  Before you settle on a policy, consider any other auto coverage you may have so you don’t duplicate coverage.  For example, if you are a member of AAA, your membership probably covers towing costs if you break-down.  Therefore, there’s no need for a policy that includes roadside assistance coverage.

As your insurance agent, we are here to guide you in selecting your insurance coverage.  Please call us today and we will help ensure you have the right coverage for your needs.  



Once you finish documenting your inventory, either print out the files or burn a CD.  Keep a copy in a safety deposit box or have a friend store it. In case your home is severely damaged, or if you experience a hard-drive crash, it is critical to keep a second copy of your home inventory off-premises.

Finally, remember to update your home inventory annually to add newly acquired items and remove items you no longer own.

Scheduled Personal Property
Case Study: Computer Insurance You Really Need

When something happens to your laptop, will your homeowner’s insurance help pay for a new one? If you have a standard policy form, maybe not. The standard policy covers personal property of all types for specific causes of loss. This includes things like fire, lightning, explosion, windstorm, and theft. It does not list the other common causes of computer loss. If someone steals a laptop from a dorm room, the policy will provide coverage. If the student drops it and cracks the screen, there is no coverage.

For a relatively small cost, homeowners, renters, and students can insure their important but delicate belongings against thefts and accidents.

The same is true for other high-priced personal property. The relatively small cost of Scheduled Personal Property coverage for your jewelry, antiques, collections, fine art, and so on is well worth the peace of mind. Call us to see if you can benefit from adding this coverage for your valuable belongings.



Insuring Your Student Away at College

Sending a child off to college is always an exciting and anxious time for parents. They worry about their child’s safety, roommates, and independent living. Between making sure that textbooks and supplies have been purchased, tuition bills paid, and course registrations completed, it’s natural that parents won’t think about insurance considerations. Here are a few items to think about:

1. Your student's age and status
A homeowner’s insurance policy may not cover a part-time student or one over a certain age. For example, policies often state that a person has coverage if he or she is a full-time student and was a resident of the policyholder’s household before moving out to attend school. They also limit coverage to students unless they are either under the age of 24 and related to the policyholder or in the policyholder’s care and under the age of 21.

2. Driving at school
If the student brings a car to college and the parents’ auto insurance policy lists it, the student will have coverage for its use. If students buy their own policy, make sure liability coverage is purchased in an amount at least equal to what the parents have. Purchasing only the minimum limits required by state law could mean owing a large amount out of pocket if an accident occurs. Coverage is typically in place on the parent’s policy if a student occasionally borrows someone else’s car.

3. Personal belongings
A typical policy covers the student’s belongings while at college, but limits coverage to 10% of the insurance amount covering the parents’ personal property. For example, if the policy shows a limit of $100,000 for coverage of personal property, it will cover the student’s property up to a maximum of $10,000. If this amount of insurance is too low, you’ll want to consider higher limits.

4. Laptop
Many colleges require students to own a laptop computer. As mentioned previously, make sure to schedule your student’s laptop to cover against dropping the computer, spilling a beverage on it, or incurring damage to its circuitry from a power surge.

5. Liability
The homeowner’s policy will typically cover students’ liability for any injuries or damages they may cause to others while at school.

Apples to Oranges: Not All Insurance Policies are the Same

When it comes to auto insurance policies, there are countless options on the market. However, not all policies are created equal. While you may be tempted to buy the insurance policy with the lowest price tag, this might end up costing you in the long-run. Here are a few tips for choosing the best policy:

• Compare limits - make sure yours are adequate
• Protect against gaps in coverage (e.g. umbrella policy)
• Customize your policy (limits, discounts)
• Read the fine print
• Work with a professional

We are here to make sure your auto policy does its job: keeps you protected in case of an accident. As independent agents, we can do the shopping for you, apply applicable discounts, and - most importantly - make sure you have the right policy for your situation.

Consider Four Key Areas When Buying Homeowners Insurance

You buy homeowners insurance to protect your biggest asset, so it’s important to purchase enough coverage to suit your needs. By looking at a few key factors, you could end up saving yourself a lot of money and heartache should you ever have to make a major homeowners insurance claim. Be smart and ask yourself the following four questions when considering how much coverage to purchase.

1. How much will it cost to rebuild?
2. How much will it cost to replace my personal possessions?
3. Will I have any additional living expenses as a result of an insured disaster that damages my home?
4. How much coverage do I have in the event I am named in a lawsuit for bodily injury or property damage caused to others?

Four Reasons You Might Want to Get Under an Umbrella

Umbrella policies provide additional insurance that takes over when a claim uses up all of the homeowners or auto insurance. They can even cover some losses that home and auto insurance do not cover. They provide insurance amounts as low as $1,000,000 and may provide $5,000,000 or more. And they are not just for wealthy people. Here are four situations where umbrella policies are vital:

1. Auto Insurance
A driver loses control on icy pavement and strikes another car. The other driver suffers serious injuries tallying up to $900,000. The at-fault driver has an auto insurance policy that covers $250,000 for injuries to any one person. If he has an umbrella with a $1,000,000 limit, it will pay the remaining $650,000.

2. Homeowners insurance
A homeowner has insurance that covers her liability for bodily injuries to others up to $300,000 per accident. Three neighbor children drown in her swimming pool. The neighbor’s estate sues her for $1,500,000. Her homeowner’s insurance will pay $300,000; but if she doesn’t have an umbrella, she is responsible for the remaining $1,200,000.

3. Boats
A man has a boat insurance policy that covers his liability for injuries to others up to $300,000. He loans his boat to a friend for the weekend. His friend is wreckless and plows into another boat. The survivors and the estates of the deceased sue the driver and the boat owner. The court finds the owner liable for $1,000,000 of the judgment. His boat policy pays $300,000 but he is responsible for $700,000 because he didn’t have an umbrella policy.

4. Personal injury
A woman loudly repeats a rumor she heard about her neighbor. The neighbor sues her for defamation of character and wins $500,000. The woman’s homeowners insurance does not cover defamation, but her $1,000,000 umbrella does. After she pays a $250 deductible, her umbrella pays the rest.

Ergonomics is the science of designing the job, equipment, and workplace to fit the worker. Proper ergonomic design can prevent repetitive strain injuries, which can develop over time and can lead to long-term disability. Here are some important tips to keep in mind:

• The top of the computer monitor should be at or just below eye level
• Head and neck should be balanced and in-line with torso
• Shoulders should be relaxed
• Elbows should be close to the body and supported
• Lower back should be supported
• Wrists and hands should be in-line with forearms
• There should be adequate room for the keyboard and mouse
• Feet should be flat on the floor

Source:  www.osha.gov

Group presentations and individual consultations can be one of the most effective ways to communicate.  Open conversation engages employees and allows them to ask questions relevant to their needs. 

Customized Employee Benefits Website
Benefits manuals can easily be lost or misplaced.  Offering employee benefit information online allows employees to quickly get answers to their questions.

Benefits-at-a-Glance Summary Sheets
Lengthy manuals can be overwhelming to an employee trying to understand offered benefits.  A “frequently-asked questions” sheet with concise answers can save employees unnecessary frustration.

Employee Newsletters
An employee newsletter with articles reviewing benefits, addressing questions, or announcing changes will remind employees of what is being provided.

*Source:  www.humana.com

We all know the holidays often come with feelings of stress given the high expectations for the season.  Here are some helpful hints to keep your employees productive and healthy throughout the holidays:

Set Work Expectations:  Set clear and reasonable goals with your employees as to what work should be completed prior to holiday time off.  Encourage time management in daily tasks to manage the workload.

Encourage Physical Activity:  Create incentives to maintain your wellness program throughout the season.  Post healthy holiday tips, like drinking plenty of water and exercising regularly.
Communicate Holiday Pay:  If a holiday bonus is not in the budget this year, be sure to let your employees know so that they can budget their holiday expenses.  Communicate paid holidays so employees can schedule time off accordingly.




Create a Harassment-Free Workplace

Harassment and discrimination can cause disruption in the workplace, lower employee morale, and could even result in a costly lawsuit.

The US Supreme Court has held that employers can be found liable for harassment and discrimination claims, even if the employer wasn’t directly aware that harassment and discrimination were occurring in the workplace. 

Harassment can include any verbal, written, or physical act that makes employees uncomfortable at work or interferes with their ability to perform their jobs. It can include jokes, emails, cartoons, drawings or other material that is suggestive or reflects negatively on a protected class. It can include slurs or offensive language.

As an employer, you can be held accountable for all forms of unlawful discrimination and harassment, so it pays to have a proactive policy to protect your business and your employees. Here are some ways you can begin to address the issue:

• Create a harassment and discrimination prevention policy:  Make sure employees know that you will not tolerate harassment or discrimination. Distributing a formal written policy outlining your commitment to a harassment and discrimination-free workplace is a good way to start.  Make sure you and
your managers demonstrate that you believe the policy
is important.

• Outline steps employees should take: Your policy should also include a reporting procedure for employees who feel they are being harassed or discriminated against. It is important to make sure the method is clear, easily accessible, and confidential.


• Conduct a thorough investigation: An immediate investigation is imperative to protecting your employees and business.  Once a complaint has been submitted, an objective and confidential investigation should be completed.  Retaliation should not be tolerated.  If it is determined that unlawful harassment has taken place, disciplinary action commensurate with the severity of the offense should be taken.

Are your employees contributing to their retirement fund?

Have your employees continued to contribute to a retirement savings plan despite the recession? If so, they are not alone. In the second quarter, more workers contributed to their retirement plan than reduced their contribution, according to a Fidelity Investments study. This is compared to the previous three quarters. In fact, the average account is up 13.5 percent from the first quarter due to the stock market rally and contributions.

Workers in their 30s and 40s continue to save and have a higher percentage of contribution in workplace plans than workers in their 20s – even though those in their 20s stand to benefit tremendously by investing early.

Tips for employees saving for retirement:

• Start saving early in your career
• Make wise investments
• Look beyond immediate gratification
• Save, even if it’s a small amount
• Use banks for your emergency funds

Will this flu season affect your business?

The coming flu season will likely include the H1N1 flu, which the World Health Organization has declared a global pandemic. They estimate that one-third of the world will be infected with H1N1 within the next two years. While it is hard to predict the severity of this flu strain, recent reports suggest
H1N1 will affect about 50% of Americans.

If your employees get the flu, have a plan in place for operating with a reduced workforce. Also take measures to prevent the spread of the flu among your employees. Consider being more flexible, such as not requiring written proof of illness and allowing telecommuting. Also, provide additional cross-training among employees, and recommend they get flu shots for the H1N1 and seasonal flu. Keeping workplaces as clean as possible can help in avoiding contamination. The flu can spread quickly, and a person infected with the virus can be contagious before any symptoms are noticed. If your employees show signs of flu symptoms, don’t hesitate to send them home.

Publicize these everyday prevention steps at work

• Cover your nose and mouth with a tissue when you cough or sneeze. Throw the tissue in the trash after you use it.
• Wash your hands often with soap and water, especially after you cough or sneeze. Alcohol-based hand cleaners are also effective.
• Avoid touching your eyes, nose or mouth to prevent spreading germs.
• Try to avoid close contact with sick people.

If you are sick with a flu-like illness:

• Stay home for at least 24 hours after your fever is gone, except to get medical care.

Is Your Wellness Program in Compliance?

With wellness programs increasing in popularity in the workforce, it is important that employers ensure their programs are in compliance with federal regulations. There are multiple laws impacting wellness programs, depending on the type of plan you implement (e.g. voluntary or mandatory; participation-based or goal-based incentives). Appropriate incentives for wellness programs can include:

• Reimbursement for the cost of a gym membership
• Rewards for attending a monthly health education seminar
• Cash incentives for participating in a cholesterol or blood screening
• Reimbursement for weight loss or smoking cessation programs

Make sure your plan is non-discriminatory. In particular, goal-based plans have several requirements for compliance, including providing eligible employees with an opportunity to qualify for incentives at least annually, and offering an alternative to employees whose circumstances would make participation difficult. Wellness programs encourage your workforce to stay healthy, which ultimately will keep your healthcare costs down. It is advisable, however, to work with legal counsel when designing a wellness program due to the compliance requirements and the variations in program design.




Keeping Employees Happy
While Tightening the Benefits Budget



Within any business, the Human Resources (HR) department faces unique challenges during trying economic times. The benefits budget may be cut in order to help overall company finances leaving HR tasked to motivate employees who feel the squeeze of any cuts.

What can an HR department do when faced with such a challenge? Consider the following ideas for containing benefits costs and easing the additional financial burdens today’s employees face.

• Offer qualified transportation benefits. Commuting costs are becoming more burdensome for many employees. You can offer qualified transportation benefits at little cost to your company through a reimbursement arrangement funded with employee pre-tax dollars. Qualified transportation benefits can include transit passes, qualified parking, and rides to and from work in a commuter highway vehicle (also known as vanpooling). This type of arrangement can save employees money on federal, Social Security, and (in most cases) state taxes, making it less expensive for them to commute to work.

• Consider implementing flexible work schedules, if this is an option for your type of business. For example, consider four 10-hour work days per week. This saves the business on energy costs and employees on transportation costs. Plus, many employees will appreciate the additional free day, whether it gives them a three-day weekend or a day during the week for running errands or relaxing.

• Add voluntary benefits to your benefits package, or expand the voluntary benefits choices you currently offer. Voluntary benefits are paid in full by the employees who choose to enroll. They offer advantages to employees over purchasing these benefits in the open market: Employees typically enjoy some savings and convenience, since they are purchasing the benefits at a group rate and paying for them via payroll deduction.

• Coverage summary for employees. Surprisingly, many employees don’t realize the extent to which their employers are paying for these benefits; they only know their own out-of-pocket costs. A brief, to the point “Capsule of Your Benefits” can summarize coverage for employees, and include the price tag being shouldered by the employer.

HIPAA changes: What you need to know

The recent stimulus package will affect many aspects of the healthcare system. One area where you will see significant changes is in regard to HIPAA, or the “Health Insurance Portability and Accountability Act.” Some of the key changes include:

• Certain privacy rules will apply directly to covered business associates.
• New security breach rules will require notification to each affected individual in certain instances.
• Some HIPAA-related penalties have increased.
• Changes will be needed to HIPAA forms to comply with new regulations.

The Department of Health and Human Services (HHS) is expected to provide additional clarification on many changes. We will be watching carefully as additional information is made available. We recommend business associates and covered entities contact us to review these changes carefully.