Congratulations, You’ve Won the Construction Contract – Now, you Need USL&H

Author, Kevin Howard, CRIS, Account Executive, Rancho Mesa Construction Group

If the title of this article gave you a good chuckle, you most likely have bid a job somewhere near a body of water; then, found out you need U.S. Longshore and Harbor (USL&H) Workers’ Compensation coverage.  You were surely not the first one to overlook this requirement and you definitely will not be the last.

History of USL&H

Let’s begin with a USL&H history lesson to understand why it was implemented, nearly 100 years ago. 

The U.S. Longshore and Harbor Workers’ Compensation Act was implemented in 1927 to provide compensation to an employee if an injury or death occurred upon navigable waters of the US - including any adjoining pier, wharf, dry dock, terminal, building-way, marine railway or other adjoining area customarily used by an employer in loading, unloading, repairing, dismantling or building a vessel.

The act’s passage compensated maritime workers, including most dock workers and ship builders that were not covered by the Jones Act ( 46 U.S.C. 30004), which only covered seamen, not those who worked in maritime-support industries.  Therefore, USL&H workers' compensation was intended to protect those employees who would otherwise not be covered. 

Moving forward to present day, to avoid conflict, project owners and general contractors alike require subcontractors and vendors to provide USL&H coverage if projects are close to navigable waters. 

Does Every Insurance Carrier Offer USL&H Coverage? 

The answer is no. Not every workers' compensation carrier is filed to offer USL&H.  Depending on the industry, classification codes and payroll size, there is most likely only a handful of options available. With that said, it’s important to know who those insurance carriers are if you plan on bidding a project that requires USL&H.  

Acquiring USL&H Coverage

The first move to acquiring a USL&H policy is to call an insurance representative that has experience in this area. Then, you can develop a game plan that will help you navigate within the USL&H marketplace.

As an eleven-year Best Practices Agency, Rancho Mesa can assist with your USL&H needs. We have been helping clients in the construction field for over 20 years. Contact Rancho Mesa at (619) 937-0164 for more information about this type of policy. 

OSHA Launches Electronic Reporting System

Author, Alyssa Burley, Client Services Coordinator, Rancho Mesa Insurance Services, Inc.

It is official – the Occupational Safety and Health Administration (OSHA) released its website for the electronic submission of employers’ injury and illness records (i.e., OSHA 300 logs).  

After a delay, the Injury Tracking Application website is now available to employers.  According the OSHA.gov, “certain employers are required to submit the information from their completed 2016 Form 300A electronically from July 1, 2017 to December 1, 2017.”  This means employers have about four months to submit their reports online.

The new requirement was designed to make OSHA records publicly available on the internet in hopes that it would encourage employers to maintain safer working environments.  
On the website, employers will be able to manually enter data into a web form, upload a .CSV file, or utilize an automated recordkeeping system with the ability to transmit data electronically via an API (application programming interface).

Rancho Mesa clients who are using the Risk Management Center can expect a .CVS export to be available in October 2017.  As long as you have the information in the Risk Management Center, you will be able to generate the .CVS file and upload the reports to the OSHA website.

For those who are not currently using the Risk Management Center to track your incidents, now is a great time to enter the data from 2016, so it is archived in the system and you’ll be able to transfer it once the export is available. 

For details regarding who must keep and report OSHA records, visit www.osha.gov/injuryreporting.
 

5 Tips to Improve Your Fleet and Driver Safety Program

Author, Drew Garcia, NALP Program Director, Rancho Mesa Insurance Services, Inc.

In order to create a best practices fleet safety program that will help you reduce claims and control premiums, we recommend you consider adding the following controls to your written fleet safety program.

1. DRIVER SELECTION

• Check MVR’s prior to allowing anyone the opportunity to drive for your company. Enroll drivers into the DMV Pull Program to monitor their driving experience throughout the year.
  DMV Pull
• Create a short written driver safety quiz that all drivers must pass with a certain percentage of correct answers. Be sure to go over the incorrect answers to help them grow as a safe driver. Consider re-testing on a regular basis.
  Quick Safe Driving Quiz, Decision Driving Quiz
• Perform a drive test with the employee to make sure they are capable of operating the vehicle safely. Be sure to have employee’s attach trailers, park vehicles with trailers and cone off vehicles if it will be required during the scope of their employment.
  Road Test Evaluation Form, Road Test with Trailer Evaluation Form
• Create custom policies that outline driving requirements employees must reach to be able to drive for the company and sustain their eligibility to drive.
  Sample Driving Requirements

2. FLEET MONITORING SYSTEM

• Consider using fleet management systems to help monitor route efficiency, speed, GPS, and fuel intake while automatically tracking when maintenance is required per vehicle based on individual use. It is highly suggested you disclose that your company uses fleet monitoring systems to all your employees and include this in your employee handbook.
  Fleet Monitoring Information

3. DISTRACTED DRIVING POLICY

• Implement and remind employees that distracted driving is the leading cause for motor vehicle accidents. Create a policy that employees are aware of and regularly remind them of your stance on distracted driving. 
  Sample Distracted Driving Policy, Distracted Driving Quiz, Distracted Driving Article

4. QUICK TRAINING CHECKS AND BALANCES

• Consider creating a proprietary “Company Name Quick 365” safety training techniques to reiterate the importance of safe driving.
  • Quick vehicle and rig checks prior to starting the vehicle to ensure everything is secured and ready to be mobile.
  • Reward employees for safe driving techniques or suggesting safe company procedures.
  • Use actual accidents and incidents to create training topics with possible solutions.

5. DETAILED ACCIDENT INVESTIGATION

• When an accident occurs, be sure your employee is properly trained to document the incident with an in depth accident investigation report.
  Accident Investigation Report

For questions about your fleet and driver safety program, contact Rancho Mesa Insurance Services, Inc. at (619) 937-0164

Hired and Non-Owned Liability Coverage: The Sleeping Giant

Author, Daniel Frazee, Vice President, Rancho Mesa Insurance Services, Inc.

Could your company have underlying Auto related exposures that you are not aware of?  Let’s assume you have taken several precautions to properly manage the safety of your fleet.  But has your management team contemplated potential losses arising from employees operating their own personal vehicles as they relate to your business?

Consider the following examples where an employer can be held accountable as a result of actions of your employees using their own vehicles:

• Field employees on the way to or leaving a jobsite 
• Administrative employees running errands to the bank, supply store or post office
• An employee runs out to pick up lunch and/or supplies for the team
• An owner or manager decides to rent a vehicle at an out of town conference
• Outside sales reps are provided a car allowance for business use of their personal autos
• A foreman leaves a jobsite and runs to Home Depot for some tools

If an employee in any of these situations is in an at fault accident while driving their own vehicle, the employer can be held responsible for all damages.  Typical Auto liability policies only cover employees while they operate company-owned vehicles that are being used for business purposes.  Since this coverage does not contemplate nor cover the use of a hired (rented) or non-owned vehicle, a gap in coverage is created.  This gap can be filled for a nominal additional premium, by adding hired and non-owned liability coverage. Specifically, these coverages respond when a company is found legally liable for damages after the employee’s personal auto insurance is exhausted.  The employee’s personal auto coverage will always be primary to both the employee and the business assuming it was found that the employee at fault while using their vehicle in the course of employment.  Without hired and non-owned liability coverage, a company remains exposed to significant costs depending on the degree of bodily and/or physical damage to the vehicle and other parties involved.

Many employers are simply unaware or unwilling to address this ticking time bomb that is non-owned liability.  Several “best practice” control measures can be implemented to reduce this exposure:

• Designate a person within the company that will oversee those employees with a non-owned vehicle exposure
• On a bi-annual or annual basis, require employees driving personal vehicles to provide the proof of valid auto insurance 
• Consider establishing company mandated minimum limits that are higher than the CA statutory minimum of $15,000/$30,000/$5,000.
• Consider reimbursing employees for any additional premium incurred for increasing limits on their personal policy to reach minimum limits set by the company
• Enroll all employees driving company and/or personal vehicles in the DMV’s employer pull notice program.

In summary, take time to learn more about hired and non-owned liability coverage and how it can impact your bottom line with exposure to severe auto losses.  As a National Best Practice Agency 11 years running, Rancho Mesa takes pride in thorough and exacting policy audits that uncover these and many other silent exposures.  Through their continually developing Risk Management Center, they offer clients unmatched support with topical safety resources, monthly workshops & trainings, and valuable content.

Contact Rancho Mesa if you have questions about your auto policy.

7 Tips to Protect Your Business from a Fire

Author, Alyssa Burley, Client Services Coordinator, Rancho Mesa Insurance Services

As San Diego’s East County battles a series of wild fires, it is a perfect time for business owners to review their insurance policies and proactively manage their fire risk, especially those who are located in semi-rural and rural areas.

Wildfires can quickly turn into structure fires, which can devastate a business.  Unfortunately, San Diego County’s fire season has already begun.  With scorching temperatures and an abundance of dry brush left over from last year’s rains, this season is particularly dangerous.

In an instant, you can lose everything you have built.  Let us make sure you are covered.  And, let us help you protect your business with these easy and effective steps:

1. Review your insurance policy with your broker.
2. Comply with all fire safety codes – we can provide a fire safety company referral, if one is needed.
3. Schedule regular landscaping around your building which includes lawns, brush and trees – we would love to introduce you to some of our landscape clients, if you need a referral.
4. If a fire threat is issued in your immediate area, run the exterior sprinklers or dampen the building and landscaping with a hose.
5. Keep fully charged fire extinguishers on site at all times and have your fire detection and suppression systems tested – we can provide a fire safety company referral, if one is needed.
6. Train employees on what to do if there is a fire, including calling 911 and where to access a fire extinguisher – the Risk Management Center has training materials for fire prevention and fire extinguisher use.
7. Have a formalized evacuation plan – the Risk Management Center has a great template to help get you started.

These steps are simple and effective ways to help protect your business from fires.

Contact Rancho Mesa with questions about your coverage.

^{The information in this article is believed to be reliable and accurate; however, Rancho Mesa Insurance Services, Inc. does not warrant the accuracy or reliability of the information. The suggestions in the article are not a complete list of every loss control measure. Also, this information is not intended to replace manuals or instructions provided by the manufacturer or the advice of a qualified professional. Nor is it intended to effect coverage under our policy. Rancho Mesa Insurance Services, Inc makes no guarantees of results from use of the information contained in this article.}

Increase Bonding Capacity Through Jobsite Pictures

Author, Matt Gaynor, Director of Surety Bonding, Rancho Mesa Insurance Services, Inc.

A picture may be worth a thousand words, but it can also be worth hundreds of thousands of dollars when it comes to bonding a new construction project. Let me explain the bonding process and how a few pictures can free up a contractor's bonding capacity.

For Construction Bonding Programs, we typically provide a Single Project Limit and an Aggregate Surety Program to guide our clients with pre-approved parameters they can use to bid on projects that require bonding. Although many factors come into play when providing a single project limit, the general rule is 1½ times the largest project completed to date.

The Aggregate Program is made up of the “Cost to Complete” for all bonded and non-bonded projects the contractor has open. To compute the cost to complete, take the estimated cost of the project less the cost to date listed on the work in progress schedule.

One way the agent and bond company can check on the progress of a particular project is by sending a status form to the owner or general contractor. The status form is used to determine how much work has been completed to date.  It also includes a comment section to report any problems on the project.

Proving a project is progressing is highly important for a contractor, since it can free up their bonding capacity and allow them to get bonding on additional projects. But, what happens when the owner of a project doesn't return the status form in a timely manner and the contractor needs to free up bonding capacity in order to get bonding on another project? 

Case Study

Recently, Rancho Mesa was looking for a way to fit a new bonded project into a contractor’s aggregate program, which was almost at capacity. 

In an effort to speed up the process of releasing bonding capacity, the contractor provided pictures (from various angles) of one of his current bonded projects. The pictures showed that several sections of the project were complete. This allowed Rancho Mesa to confirm with the bond underwriter that over 60% of the project was complete. Thus, the underwriter was able to release over $750,000 of capacity to be used on the new project that required bonding.

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While the preferred method to release bonding is to get a signed status report from the owner; sometimes, a few pictures from the jobsite can help quicken the process, while we wait for the signed document.

For questions about Surety, contact Rancho Mesa Insurance Services, Inc. at 619) 937-0164.

Control your Experience MOD through the MOD Doctor Process.

Author, Drew Garcia, NALP Program Director, Rancho Mesa Insurance Services, Inc.

Successfully maintaining low and predictable workers' compensation costs is a product of establishing a routine that constantly “checks and balances” your all-encompassing insurance program. Our MOD Doctor™ technique lays out a road map so we can guide you throughout the year to gain more control, become more efficient, and ultimately drive down your insurance cost; at no extra expense. What can you expect from this process?

Audit Experience MOD Worksheet. Our team analyzes your experience MOD worksheet to ensure the information is accurate with payrolls, claim information, and class codes.

Analyze Claim Frequency, Severity, and Trends. It’s important to analyze your company’s loss information and specifically look for trends in order to prevent further claim activity with similar causes. Furthermore, we compare your loss experience against the landscape industry, in your state, to determine whether you are outperforming or underperforming your industry.

Claims Meetings. The largest companies maintain claim review meetings on a consistent basis. We bring this service to you and adjust the frequency of the meeting to fit your needs. It’s important to have updated information on your open claims, without sacrificing your time or your employee’s time tracking down this data.

Pre-Unit Stat. Your experience MOD is calculated on claims information which is sent into the governing bureau roughly six months into your policy period. Knowing this information, we can accurately project your MOD six months in advance giving you the information you need to begin budgeting for future work,while considering where your insurance cost will be headed.

Claims Advocacy. Our team is your advocate in helping to seek information on your claims, both in the current year and in the past. Our goal through this process is to decrease existing claim costs, reduce excessive reserves, and expedite claim closure, all while considering your unit stat date.

Risk Management Center. We know maintaining up to date and accurate information for tailgate topics, safety procedures, and  incident tracking is important. The Risk Management Center streamlines these functions by making them accessible to our clients online.

Contact our Rancho Mesa staff to learn more about how the MOD Doctor can help you control your workers' compensation costs.
 

Uninsured and Underinsured Motorists Coverage - Are Your Limits Adequate? - Be Careful!

Author, David J. Garcia, A.A.I., CRIS, Rancho Mesa Insurance Services, Inc.

Earlier in the year, we published the article "Commercial Auto Premiums Are Rising - What’s Driving the Increases?," which addresses how insurance companies are all experiencing adverse loss experience within their commercial automobile books of business. The result of these mounting losses is causing a dramatic rise in commercial Auto premiums for most policyholders.

As a result of this trend, we are seeing many carriers and brokers reducing coverage limits and terms on certain lines of automobile coverage. This represents a major concern for any business owner that has any size fleet of vehicles. Reducing limits and/or modifying terms of coverage simply transfers more claim exposure directly to the business owner. And, unfortunately, in many cases, business owners are unaware of the change or ill informed. 

One specific line of coverage that we are seeing this occur, and creates great concern, is uninsured/underinsured motorist coverage. The number of uninsured motorists nationwide is alarming and here in California there are between 3.6 million and 4.1 million uninsured drivers, or 14.7 percent of all drivers. Additionally, the minimum limit of insurance in California is only $15,000. So, while many motorists may have insurance, they are woefully “underinsured.”   These factors pose potential catastrophic exposures to any business. To illustrate this point, we will briefly define these coverage’s and then look further into how these lower limits of coverage terms may impact the health of your business.

Uninsured Motorists Coverage

Uninsured Motorist Coverage (UM) helps pay your, your employees and your passenger’s medical expenses, lost wages and related property damages if you're in an accident caused by a driver who doesn't have liability insurance.

Underinsured Motorist Coverage

Underinsured Motorist Coverage (UIM) helps pay your, your employees and your passenger’s  medical expenses, lost wages, and related property damages, if any of you are hurt in a car accident caused by someone with liability insurance, but whose coverage limits are lower than those you choose for this coverage, and aren't high enough to pay the damages.

Best practices suggests anything less than $1,000,000 limit for uninsured/underinsured coverage is inadequate and puts the business at extreme financial risk. Let me explain by sharing just two, of many real-world, examples of how this could occur. The following examples assume the accident is the fault of an uninsured or underinsured driver:

Example 1. If one of your employees is involved in an automobile accident by either an uninsured or underinsured motorist and it involved the use of a vehicle for business purposes, the resulting medical and indemnity costs would be covered under your company’s workers' compensation policy. Two negative consequences to your overall insurance program develop as a result of this incident. First, your workers' compensation claims experience (loss ratio and EMR) will be negatively impacted. Second, since the “at fault” driver is either uninsured or underinsured, subrogation (or the recovery of the claim dollars from the responsible party) is ruled out as a viable option to your workers' compensation carrier. 

Therefore, the auto loss described above would not only negatively affect your auto insurance experience but also your workers' compensation experience, as well. By having a minimum of $1,000,000 UM/UIM limits, you would have allowed you workers' compensation carrier to subrogate the costs of the claim to the auto carrier and thereby reduce the impact to your workers' compensation loss ratio and EMR

Example 2. Let’s assume you have a non-employee in the vehicle and they are involved in an accident involving an uninsured/underinsured motorist and they are injured. Since this is a non-employee, their injuries would not be eligible for coverage under your workers' compensation policy and rest solely on your automobile insurance limits and coverages. Thus, these injuries, once the uninsured/underinsured limit of your automobile policy is exhausted, would become the responsibility of the business. By having a minimum of $1,000,000 UM/UIM limits, you would fill the gap created by the uninsured/underinsured motorist's lack of coverage and protect your business from this catastrophic loss.

These examples have only touched on the medical and indemnity portion of the loss. Consider there may be property damage involved as well, which only further increases the potential of out of pocket expenses a business might be responsible for paying. Additionally, keep in mind that any excess liability policy you may have in place does not cover uninsured/underinsured motorist claims.

In summary we recommend that you review your coverage limits and terms for adequacy concerning these critical coverages. At a minimum, you should have a limit of no less than a $1,000,000 for these coverages. The premium savings by lowering this limit or modifying its coverage terms is insignificant to the catastrophic loss you are exposing your business to. Do not allow one terrible incident to take your business from you when the cost to transfer this risk is marginal.

If you have any questions or need help in accessing your exposures, please call our Rancho Mesa Team. We offer full policy audits as part of our RM365 Advantage Program that helps you to identify any gaps in coverage and provide you with Best Practices risk management recommendations.
 

OSHA Launches Inaugural Safe + Sound Week

Author, Alyssa Burley, Client Services Coordinator, Rancho Mesa Insurance Services, Inc.

The Occupational Safety and Health Administration (OSHA) launched its inaugural Safe + Sound Week, which runs from June 12 - 18, 2017.   According to OSHA, Safe + Sound week is "a nationwide event to raise awareness and understanding of the value of safety and health programs that include management leadership, worker participation, and a systematic approach to finding and fixing hazards in workplaces."

Why should your company participate?
Workplace safety and health programs can help companies proactively identify and manage workplace hazards before they cause injury or illness. That is good news for companies and employees.

How can businesses participate?
There are three easy steps to participating in Safe + Sound Week. Visit OSHA's Safe + Sound Week webpage for more information on each of these steps:

Step 1: Select the activities you would like to do at your workplace. There are three activities to choose from: Management Leadership, Worker Participation, and Find and Fix Hazards.

Step 2: Plan and promote your events.  OSHA has provided Event Tools, Graphics & Signage, Customizable Communications materials, Social Media (#SafeAndSound), and Recruitment Tools.

Step 3: Get recognized for your participation. Complete the online form to generate a Safe + Sound Week Certificate of Recognition and web badge for your organization.

^{Videos provided by the Occupational Safety and Health Administration.}

Source: https://www.osha.gov/safeandsoundweek/

Timely Claim Reporting Lowers Work Comp Claims Costs and Improves Your Bottom Line

Author, David J. Garcia, A.A.I., CRIS, President, Rancho Mesa Insurance Services, Inc.

Studies have shown, by reporting your workers compensation claims in a timely basis, not only will your injured employee receive better medical treatment, it will boost company morale.  Both the injured worker, as well as other employees, will see your sincere concern for their wellbeing.  In addition, timely reporting practices will also improve your risk profile through reducing the overall cost of the claim, which leads to lower loss ratios and lower experience modifiers, thus, resulting in lower premiums and improvement in your bottom line.

The following are four areas that support the early and timely reporting of claims:

1. Manage Claims More Efficiently
Reporting a claim quickly allows the claims examiner:
• To determine whether or not the claim is compensable.
• To meet state regulations that prohibit denial of claims after a specified time period.
• To secure appropriate treatment for the injured worker.
• To conduct an investigation and determine if fraud is suspected.
• To receive timely witness statements and pictures of the incident.


2. Keep The Claim Costs Down – Improve Loss Ratio – Improve Experience Modifier
Delayed reporting can significantly increase workers’ compensation claim costs, according the National Council on Compensation Insurance.
• Claims reported after 2 weeks of occurrence are 18% more expensive than those reported within 1 week of occurrence.
• Claims reported after 3-4 weeks of occurrence are 30% more expensive than those reported within 1 week of occurrence.
• Claims reported 1 month of occurrence are 45% more expensive than those reported within 1 week of occurrence.



Reporting (Lag) Time	Expense Increase
2 Weeks	18%
3 Weeks	29%
4 Weeks	31%
4 Weeks	31%
5 Weeks	45%

_{First Report of Injury: Impact of Claims Cost, 2001 Anne Enleman and Patrick Vice.}

• Most significantly, back injuries, as a group, are 35% more expensive if not reported within the first 7 days post-injury.
3. Reduce Litigated Claims
• 47% of all claims reported after 4 weeks become litigated, which on average increase claims costs by 30%.
  _{Source: NCCI’s Detailed Claim Information data for Report Years 2010 and 2011 case incurred losses valued as of 18 months after report date; not developed to ultimate}
4. Close Claims Faster
• 50% of claims that are reported within the first two weeks close within 18 months.
• Only 29% of claims that are reported more than a month after the accident close within the same timeframe.
  _{Source: NCCI’s Detailed Claim Information data for Report Years 2010 and 2011 case incurred losses valued as of 18 months after report date; not developed to ultimate.}

If you’re not currently reporting your claims timely, we strongly encourage you to adopt this “Best Practice” and make it a part of your company’s overall risk management program. Reporting your claims on a timely basis will get your injured employee the proper treatment quicker, provide your carrier the controls they need to manage the claim effectively, improve your risk profile, and lower your insurance costs.

OSHA Not Prepared to Accept Electronic Submissions

Author, Alyssa Burley, Client Services Coordinator, Rancho Mesa Insurance Services, Inc.

For over a year, the Occupational Safety and Health Administration (OSHA) have championed the upcoming electronic submission of injury and illness records (i.e., OSHA 300 logs) through its website.  The new requirement was designed to make OSHA records publicly available on the internet in hopes that it would encourage employers to maintain safer working environments.  The electronic submissions of the 2016 reports were supposed to be due by July 1, 2017.

However, in a mid-May announcement, the government agency’s website declares “OSHA is not accepting electronic submissions of injury and illness logs at this time, and intends to propose extending the July 1, 2017 date by which certain employers are required to submit the information from their completed 2016 Form 300A electronically.”

According to an article on Front Page News, “several business groups, including the Associated Builders & Contractors, Association of General Contractors, and National Association of Home Builders, had challenged the 2016 Occupational Safety and Health Administration regulation in court and lobbied the administration to jettison it on grounds that it could unfairly damage the reputation of some of their members.”

In preparation of the anticipated electronic submission requirement, developers of Rancho Mesa’s Risk Management Center, an online platform designed for risk management, workplace safety and compliance have been ready and waiting for the details of OSHA’s API (application programing interface) in order to build a seamless integration between the two websites. Rancho Mesa will keep its clients up to date on the development of this integration, if and when it becomes operational on the OSHA website.

As for now, Rancho Mesa is urging its clients to continue to track incidents in the Risk Management Center so they may take advantage of its trending tools and reports.

For details regarding who must keep and report OSHA records, visit www.osha.gov/injuryreporting.

Sources: 
“Injury Tracking Application: Electronic Submission of Injury and Illness Records to OSHA.”  United States Department of Labor. Retrieved from: https://www.osha.gov/injuryreporting/.
“OSHA suspends rule requiring firms report injury, illness data electronically.” Front Page News.  Retrieved from: http://www.advisen.com/tools/fpnproc/news_detail3.php?list_id=26&email=kvasquez@ranchomesa.com&tpl=news_detail3.tpl&dp=P&ad_scale=1&rid=283636777&adp=P&hkg=5cY58Bd37J
 

Cyberattacks Threaten Small Businesses: Help Protect Your Company's Data by Following These Steps

Author, Alyssa Burley, Client Services Coordinator, Rancho Mesa Insurance Services, Inc.

With the recent cyberattacks spreading across the globe, Rancho Mesa would like to remind its clients to take the necessary precautions to protect their business’s data.

We have supplied two documents to help you prevent a cyberattack: "Cybersecurity for Small Businesses” and “Cyber Security Planning Guide.”  Each of the documents may also be found in the Risk Management Center’s Library.

For questions about Cyber Liability insurance, contact us at (619) 937-0164.

Cybersecurity for
Small Businesses

Cyber Security
Planning Guide

Taking Your Safety Program to the Next Level: Form a Safety Committee

Author, Daniel Frazee, ARM, CRIS, Executive Vice President, Rancho Mesa Insurance Services, Inc.

"The committee must be prepared to promote the #1 goal of any organization…accident prevention."

Establishing a safety committee within your company will enhance the effectiveness of your safety program by identifying hazards and appropriate controls, implementing specific measures, developing clear safe work practices and communicating clearly through all levels within your organization.  

As your company looks to build a new committee or perhaps re-build an existing committee, consider the following as some more specific responsibilities that the group can develop:

• Promoting the importance of accident prevention
• Setting attainable goals for safe work practice
• Building a safety program that is a constant work in progress with regular updates and performance evaluation among departments
• Learning root causes through accident investigation 

The committee must be prepared to promote the #1 goal of any organization…accident prevention. Employers want their employees to go home every evening to their loved ones. That goal has to permeate through all ranks and be maintained as the culture from the top down.  With that as a primary goal, reasonable expectations have to be set for safe work practices that allow the company to maintain their level of productivity.  Best Practices dictates that the safety committee must be willing to constructively critique themselves, the safety program and each department with an objective eye toward constant improvement. Establishing root causes for both “near misses” and accidents without prematurely assigning responsibility to a specific person, can build a more open approach to tracing claim frequency and severity trends. This is the critical piece to learning from mistakes or actions to ensure similar events do not recur.

Some final points to consider for a more effective safety committee:

• Participants should encompass all divisions, departments, and levels within an organization.  A minimum of one representative/member from each part of the company should sit on the committee.
• Consider having more employees than supervisors which will build a more ground up approach from those people who know the day to day operations and tasks the best.
• Rotate the safety committee chairperson on a regular interval, whether that be every year or every other year.  This will allow opportunity for more people to have a voice and continually change the committee in a positive way.
•  Identify a clear schedule and recurring time/day for meetings throughout the year.  The chairperson should provide an Agenda in advance of meetings so members can prepare accordingly.  That chairperson should also recap each meeting with notes, review of recommendations, previous incidents, and/or trainings that have occurred.
• Include a representative from your insurance company’s loss prevention department to help provide perspective, resources and analysis.

Accept the challenge of taking your Safety Program to the next level, reduce your exposure to claims and improve both your risk profile and bottom line.  

Learn more by sending follow up questions to dfrazee@ranchomesa.com.

Additional Resource
“Safety Committee Development: Consider the time required, the budget, needed, and the desired outcomes, and then facilitate the committee’s efforts using these triple constraints as boundaries,” by Michael E. Bingham, Occupational Health & Safety, www.ohsonline.com.  
 

NALP Launches New Discounted Workers' Compensation Insurance Program

Article originally published in "The Landscape Professional" March/April 2017 issue.

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The National Association of Landscape Professionals (NALP) is partnering with Rancho Mesa Insurance Services and Berkshire Hathaway Homestate Companies to offer NALP members a competitive workers’ compensation option backed by specialized landscape industry expertise and a dedicated service team.

NALP created this program as a member benfit aimed at providing landscape-specific expertise at a discounted rate. A portion of the combined premium is re-invested
back into the association to help fund industry growth and the many programs that benefit NALP members.

The program includes:

• Multiple workers’ compensation options with guaranteed cost and small to large deductibles.
• 6 percent discounted rates for NALP members where allowable. Lowest available base rate in states that do not allow rate deviation.
• Flexible payment plans including stipulated, pay as you go (zero deposit) and monthly payroll reports.
• Quarterly safety webinars specific to the injuries arising out of the landscape industry.
• Dedicated service team with landscape industry specific experience in the workers’ compensation claims, injuries and exposures.
• Underwriting team evaluating only NALP members.
• Claims handling dedicated to NALP members with lower caseloads and the statistically proven ability to close claims faster than the industry.
• Loss control with regional representation for on-site visits managed nationally by a dedicated coordinator.

“Protecting your business, your employees and your bottom line is so important, so we are pleased to bring this highly competitive and tailored workers’ compensation insurance program to landscape and lawn care companies through this new partnership with Rancho Mesa and Berkshire Hathaway,” NALP CEO Sabeena Hickman, CAE, said.

The program is managed by Rancho Mesa Insurance Services, which has 10 consecutive years as a National Best Practices Agency, and policies are underwritten by Berkshire Hathaway, an A++XV rated financial services firm.
For more information, visit bit.ly/nalpworkerscomp.  If you have further questions or want to sign up, email nalp@ranchomesa.com or call program manager Drew Garcia at 619-937-0200.

Reproduced with permission from the National Association of Landscape Professionals.

^{Reproduced with permission from the National Association of Landscape Professionals.}

Source

Is Your Business Protected from Data Breach Costs and HIPAA Violations?

As technology and the common usage of the internet in business grow, Cyber Crime is an ever increasing exposure for businesses.  Most businesses carry large quantities of sensitive data that if breached, can create a financial and administrative headache.  Many business owners are unaware of the real exposures they have should their information be compromised, whether directly or indirectly.  Here are two of the most common costs:

Required Notifications under HIPAA
Businesses are required to notify affected individuals following the discovery of a breach.  If more than 500 individuals are affected in a given state or jurisdictions, they are required to notify the media as well.  A 2015 article from the HIPAA Journal estimated the average cost per record is $154.  That means if you had a known breach resulting in 100 clients’ information being breached (regardless of what they do with the information) you would be paying roughly $15,000 just to notify the public.  This does not include the added IT costs needed to further investigate/mitigate any losses.

Violations Under HIPAA
Violations vary depending on the degree to which a business is found negligent.  The mildest violation is a Category 1, while the most severe is a Category 4.  In the case of a Category 1 violation, a business will be penalized $100 per violation, even if they were unaware and reasonably could not have avoided a breach.  Category 4 violations can be up to $50,000 per violation.

This is an ever growing exposure that is often overlooked until it happens and then the realization of what’s required hits home.  However, there is a way for companies of all sizes to protect themselves from these exposures by including Cyber Liability coverage as a part of their risk management program.  This coverage is available and will step in and pay some of the costs associated with a breach.  These costs include HIPAA fines, notification costs, credit protection costs and forensic investigation. 

This is such a growing area of concern that we have scheduled a “Cyber Liability” workshop for May 10th where an expert on this topic from Philadelphia Insurance Company will lead the workshop and provide both an overview of the trends and threats as well as answering specific questions.  If you or someone from your company is interested in attending this workshop, you can register for it below.  

Contact our Rancho Mesa staff to learn more about Cyber Liability.

What is SB 562 all about?

It may be of interest, if not importance, for all Californians to know about current proposed legislation, sponsored by Senator Ricardo Lara of Bell Gardens and Senator Toni Atkins of San Diego.  The proposed bill would significantly expand the role of the state government within the healthcare system, by essentially establishing a single-payer system.

Under Senate Bill 562 (SB 562), the State would cover all medical services for every resident regardless of income or immigration status, including inpatient, outpatient, emergency, dental, vision, mental health, and nursing home care.  Furthermore, insurers would be prohibited from offering benefits that cover the same services, potentially resulting in their choice to exit the marketplace.  While the proposed bill touts that the program would eliminate co-pays and deductibles, and the need to obtain referrals, there is no mention of how it would be funded, except through “broad-based revenue.”

Obviously, many people ask me about the direction healthcare is headed in California and the Country; to which, I do my best to eliminate my interest in the subject since I make my living guiding companies through the insurance process.  But, I do offer up some food-for- thought in terms of evaluating such a proposal, including citing the increasing shortfall of funding for Medicare, and the VA as examples of government-run healthcare, as it seems to me the former is going to require an eventual increase in payroll taxes, which effects everyone, employers and employees alike, and the latter is a good example of inefficiency and lack of innovation when there is no competition.  

Personally, I believe that healthcare is both a right and a responsibility.  As out-of-whack as the current system seems, or let’s face it, is, I just don’t know how we go about funding such a proposal without breaking the proverbial bank. The financial and economic realities have to be weighed with the politics, which is why it’s a bit of a relief that Governor Jerry Brown has asked the question in return, “Where do you get the extra money?  This is the whole question?”

Whatever my thoughts, it is certainly a complex and vexing economic, social, and political issue for our times, one that will continue to be hotly debated and legislated, so there is much more to come.
 

Commercial Auto Premiums Are Rising - What’s Driving the Increases?

Author David J. Garcia, C.R.I.S., A.A.I., President Rancho Mesa Insurance Services, Inc.

The insurance industry is experiencing record losses on their commercial auto books of business, which is dramatically driving up insurance premiums for business owners. There are many factors that are contributing to this increase in losses; let’s take a look at six of the most prevalent.

1.    Distracted Drivers.  This one factor is now contributing over 30% of all accidents reported. This is the single most significant issue facing not only the commercial insurance marketplace, but personal auto usage as well.  Whether it’s talking on the phone, viewing and answering emails, or texting, these trends are escalating at alarming rates.
2.    Higher Auto Repair Costs.  This is one of the hidden “new” claim costs that insurance companies are facing.  Record auto sales of newer vehicles that include sensors, cameras and other new electronics are bringing the cost of repairs to higher levels than ever before.  As an example, minor fender repairs might have been a few hundred dollars in the past, but now with sensors and cameras built into most new vehicle bumpers, this cost has risen into the thousands of dollars.
3.    Increase in Miles Driven.  Since recovering from the recession, a healthier economy has lead businesses to expand and hire more employees.  Now, with an increased need for more company-owned vehicles, more miles are driven which leads directly to an increase in accidents.
4.    Rising Medical Costs.  The medical costs associated with treating auto accident victims is rising 1.5 times faster than any other cost associated with auto incidents.  While this probably comes as no surprise given the state of our health care costs, in general, it plays a major role in driving up commercial auto losses, and thus, premiums.
5.    Fatalities and Severe Accidents Increasing.  With an increase in miles being driven and the distracted driving epidemic, the severity of accidents has grown proportionately.  
6.    Less “Skilled Driver” Availability.  The growth in business and the need for more drivers has resulted in a shortage of skilled commercial drivers. The lack of availability has also increased the likelihood for more auto accidents to occur.

As a business owner, what can you do to minimize this exposure and help control your present and future auto premiums?  The process starts with having a formal written “Vehicle Safety Program” in place that is specific to your company’s needs and exposures.  The following will outline major areas that the Vehicle Safety Program should address.

1. Management Commitment – strong management involvement and concern must be evident
2. Vehicle Operator Responsibilities – distracted driving guidelines and consequences, a description on how the vehicle may and may not be used, etc.  
3. Driver Selection - established criteria in order to be eligible to drive, should include age, MVR history, etc.
4. Accident Investigation – formal written process for documenting, reporting and the resulting training to prevent similar accidents
5. Vehicle Maintenance – establish a process for regular and consistent care of the vehicles tires, brakes, oil, etc.

In addition to the above, there are other areas that need to be addressed in more detail in order for you to build your own comprehensive Fleet Safety Program.  In order to get started, you may want to reach out to your existing auto insurance carrier, as many carriers will offer assistance to their policyholders for creating a safety program.

Furthermore, Rancho Mesa has a proprietary template for our clients, as they design new and re-design existing Fleet Safety Programs.  We also offer Fleet Safety Training workshops twice a year to assist in this process.  Our workshops are free of charge and offered to current and prospective clients. 

To learn more, visit our Workshops and Webinars.
 

Should Union Janitorial Employers have a lower Workers’ Compensation rate than Non-Union Employers?

Author Jeremy Hoolihan, CRIS, Janitorial Group Leader Rancho Mesa Insurance Services, Inc.

A recent study by the Commission on Health, Safety and Workers’ Compensation made an argument that the janitorial industry should be split into two workers’ compensation class codes.  This change would be similar to how many construction operations field class codes are separated between an over and under dollar amount per hourly wage.   As an example, an electrical contractor’s field wages are split at over and under $30/hour.  Why does this matter? It matters, because the workers’ compensation marketplace perceives the higher-wage-earner to be a safer risk (the thinking being - a higher-wage-earner is more experienced and less likely to sustain injury), thus, the workers' compensation premium rates are less for those in the “above” threshold category.  However, the BIG difference between this rationale and the study is that rather than basing the split rates on pay scale, the study proposes the split be between Union and Non-Union companies.

The study’s line of reasoning is that Union firms have fewer injuries and as a whole have a much lower loss ratio than Non-Union firms.  However, many industry experts disagree and believe that the figures are skewed and not representative of the true industry experience.  Clearly with the varying opinions and so much at stake, much more research and discussion needs to take place before anything is implemented.  

With that said, in order to remain relevant and competitive, all janitorial companies need to stay well informed and be prepared for any changes should they occur.  Rancho Mesa’s janitorial department will keep a close eye on any new developments and continue to help improve your company's risk profile, so you will be well informed and prepared for any changes.  If you have any questions please feel free to contact us

Adding an Additional Obligee to a Performance Bond

Author Matt Gaynor, Director of Surety at Rancho Mesa Insurance Services, Inc.

A Rancho Mesa construction client recently asked if they should be concerned when asked to add a Duel Obligee to a Performance Bond on a construction contract.  The short answer is “no.”  But, let’s expand on that answer.

It has become increasingly more common for project lenders to require they be added as an additional named obligee/beneficiary under construction performance bonds.  Since the lender will be providing the financing for the construction project, they ultimately want to ensure the work is completed in a timely and satisfactory manner.

The request is usually solved by attaching a Dual Obligee Rider to the Performance Bond.  The rider provides the lender with the same rights as the original obligee, as long as they agree to assume the owner’s obligations to the bonded contractor under the contract.

Rancho Mesa recommends its clients ensure the lender sign the Dual Obligee Rider as acceptance of the terms of the rider.  By having both parties (the original obligee and the lender) sign the rider when the Performance Bond is issued, the contractor gains assurance that the lender will meet the same obligations as the owner in the event of a claim under the Performance Bond.

Help Control Your Workers’ Compensation Claim Costs through Accident Investigation

Authors, Dave Garcia, AAI, CRIS, President and CEO, and Drew Garcia, NALP Program Director from Rancho Mesa Insurance Services, Inc. 

When a workers’ compensation claims occurs, in order to both control the costs of the claim and look for preventive measures to reduce or eliminate similar claims from reoccurring, it is vital that a thorough accident investigation report is completed. The accident investigation report should be completed at the time of the accident, by the supervisor overseeing the injured employee, and contain the following information:

• Employee name, date, time and location of the accident,
• A description of how the injury occurred and the job duties the employee was performing when they were injured,
• The employee’s body part(s) that were reported as injured,
• If witnesses were present when the accident occurred, document their names and statements using the Witness’ Statement of Employee Accident or Near Miss Report,
• Pictures of the injury and accident area,
• Recommendations or changes that could be made to eliminate or reduce the potential for a similar claim in the future.

The goals of this process are:

• To have a timely and accurate record of the accident or incident that allows the claim to be reported to the insurance carrier in a timely manner.
• To help you to reduce the chance of fraudulent claims through documentation, pictures and witness statements.
• To analyze the root cause of the accident or near miss and implement the needed recommendations to reduce or eliminate the likelihood of future claims.

As a 10-time National Best Practices Agency, Rancho Mesa Insurance Services, Inc. understands the importance of implementing the highest standards of Risk Management practices for our clients.  So, as part of our RM365 Advantage™ program, we have developed our own proprietary Employee Accident Report and Witness Statement to assist our clients with documentation of their accidents or near misses.