Insuring Childcare Centers . . . It Only Takes One

Posted on December 15, 2011. Filed under: Commercial, Personal (Home & Auto) | Tags: , , , , , |

That’s it. Just one. Just a single accident or negligent act can wipe out a small business in a heartbeat. If you are a small business owner, especially in a specialized industy such as childcare, it is critical for you to understand the risks and how to protect yourself.

For example’s sake, let’s stick with childcare. If you provide childcare in-home, your homeowner’s insurance may or may not cover some of your liability exposure. And while it may provide limited coverage for business property, it won’t address child abuse claims or professional liability risks related to your responsibility as a childcare provider. You may think a claim such as abuse is impossible. However, even a false claim can result in serious financial loss due to the cost of defense.

For a daycare center, focusing on liability coverage only is a mistake. Coverage for your property, in the event of fire or flood, is critical. And, Errors & Omissions, in addition to General Liability, will help minimize your vulnrability to claims such as child abuse and other services expected of you.

Obtaining the right insurance is critical, but so is understanding the coverage you have. Find an agent who takes the time to educate you, not only on the benefits of your policies, but also the claims process. You must understand what happens if a claim is made after a policy term ends. Policies can be Occurrence or Claims Made. Do you know what type your policies are?

And finally, there are companies that offer specialized insurance packages for specific industries. They do not always replace every policy mentioned above. But, they can simplify the number of policies needed to ensure adequate coverage and the efficient handling of your claim. It is important to work with an agency that understands you risks and works with multiple companies.

We provide free, no obligation, policy reviews. Contact us today!

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Reduce Your Social Host Liquor Liability Exposure

Posted on November 30, 2011. Filed under: Personal (Home & Auto) | Tags: , , , , , , , , , |

The National Highway Traffic Safety Administration (NHTSA) estimates that nearly 13,000 people per year (about 35 per day) are killed in alcohol-impaired driving crashes.

Many of these tragic accidents happen after an inebriated person leaves a party—an event in which the host of that party might be held liable for injuries and deaths to innocent parties. Although there might be coverage under your personal auto policy or homeowners policy if you (as the host) are held legally responsible for such a terrible accident, a wiser risk management strategy is to avoid or reduce the chance of loss altogether. With that in mind, here are some tips to consider if you (or a resident family member) occasionally host social events involving alcohol.


  • Surveys of youth indicate that the most common source of alcohol is the young person’s own home. Thus, closely monitor social events your youth hosts to make sure there is no drinking allowed—particularly any type of illegal underage drinking. It is wise to not allow your teenager to host a party when you are out of town.
  • Limit the amount of alcohol at your event.
  • If alcohol is served at your party, make sure that there is plenty of food. The consumption of food slows down the absorption of alcohol.
  • Encourage designated drivers and provide nonalcoholic drinks for these guests.
  • Look for signs of intoxication. An intoxicated person often has trouble walking, has slurred or loud speech, or is atypically uninhibited. There is not, however, a fool-proof method of determining whether someone is intoxicated because exceptionally tolerant individuals often do not show signs of tipsiness even though they are intoxicated.
  • Restrict alcohol to any near-intoxicated or intoxicated persons by offering instead some food or alternative nonalcoholic drinks.
  • Consider hiring trained bartenders. As they are trained to recognize and deal with intoxication, using professional bartenders can significantly reduce the risk and may help in defending a claim should there be one.
  • If you have a cash bar, use tickets and issue a limited number. Don’t price alcohol too low because this encourages excessive drinking.
  • Do not allow the intoxicated guest to drive away from the event even if you have to take away his or her car keys. Instead, offer to drive them home or provide a free cab service. Soliciting the help of the guest’s spouse or a close friend may help.

Contact us for a free review of your liability coverage or for a quote. Get more personal lines insurance and risk management tips and ideas from IRMI.

Copyright 2009
International Risk Management Institute, Inc.

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Closing Your Business?

Posted on September 23, 2011. Filed under: Commercial | Tags: , , , , , , , , , |

We hope you are not one of the many businesses seriously impacted by the current economy. But, if you are, take a moment to learn more about the possible risk of cancelling your insurance.

Shutting Down Your Insurance – Commercial Liability Insurance

“I’m closing down my business. Will I need to continue any kind of insurance coverage to protect myself and my employees from future lawsuits?”

That’s an excellent question and we applaud your concern for yourself, your family and your employees.

Businesses that make or build or fix things have a continuing need for special liability insurance coverage even after the business shuts down. This coverage is called “discontinued products and completed operations liability” and it protects you and your employees against lawsuits arising out of injury or damage caused by the products you made or the work you completed while you were in business.

But wait! You purchased commercial general liability insurance for years – including products and completed operations liability –while you were making or building or fixing things. If something happens after you shut down, why won’t the policy that was in effect when the product was made or the work was done cover the resulting injury or damage?

The CGL policy does not cover bodily injury and property damage unless the injury or damage occurs while the policy is in effect. It doesn’t matter when you manufactured the product or completed the work. The only thing that matters is when someone is injured or some property is damaged because of your product or your work. A liability insurance policy must be in force when that happens.

If you are closing your business, ask your insurance agent about the availability and cost of “discontinued products and completed operations liability insurance.” There are laws – called “statutes of repose” – that dictate how long you may be legally liable for injury or damage caused by your work or products, and thus how long you may need to carry such insurance.

If you operated your business as a corporation or some other form of limited-liability entity, you may want to ask your attorney about whether you or your employees can be sued personally for accidents caused by your work or products after the business shuts down and the entity is dissolved.


****This article was prepared and made available to your agent by the Independent Insurance Agents of Texas, which is solely responsible for its content. Please read your insurance policy. If there is any conflict between the information in this article and the actual terms and conditions of your policy, the terms and conditions of your policy will apply. The Independent Insurance Agents of Texas is a non-profit association of more than 1,800 insurance agencies in Texas, dedicated to helping its members succeed, in part by providing technical resources that explain insurance policies sold to their customers.

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General Liability and E&O . . . NOT Interchangeable

Posted on July 27, 2011. Filed under: Commercial | Tags: , , , , , , , , , , |

We are focusing our discussion in this article on technology companies. However, much of the information applies to businesses that provide professional services.

Some technology companies have either general liability coverage OR an errors & omissions policy. However, both are extremely important to ensure the proper coverage for businesses in the technology (among other professional services) industry. Here is why:

General Liability:

General Liability provides two primary coverages: bodily injury and property damage, either arising from your products, services or operations. However, it often DOES NOT cover:

  1. Electronic data and media property losses, for example.
  2. Economic losses, such as a product causing the loss of customers.
  3. Product recall costs, which must be added by endorsement or through a separate policy.
  4. Generally speaking, professional services and/or advice, and any resulting liability, will be excluded.
  5. Personal and advertising injury specifically for new media, which is expanding to include more and more companies as the technology industry evolves.

Errors and Omissions:

Technology E&O, or Professional Liability, is often overlooked or purchased only when required contractually. But, it is a critical coverage that every technology company should obtain. It is also critical that you work with an insurance agent with an expertise in the technology industry and its coverages, as there is no standard form and policy comparisons are extremely difficult for the general public.

At the most basic level, E&O policies are intended to cover economic loss liability and damages to tangible and intangible property not associated with physical injury. Generally speaking, E&O will not provide coverage for bodily injury, property damage, or personal and advertising injury. It is important to remember that E&O coverage only applies to damages arising from technology products or services, while a GL policy normally covers damages resulting from all products, services and operations.

Rather than obtaining either a General Liability policy or E&O insurance, it is best for a company to purchase both coverages so that coverage gaps, which might otherwise exist, are closed.

There are other ways Technology E&O differs from a General Liability policy, including:

  1. Claims reporting periods.
  2. Deductibles usually apply to E&O policies, but not GL policies.
  3. Whether defense costs reduce the limit of liability on the policy.
  4. Does your E&O policy exclude dishonest acts with no exception for “innocent insureds”? If yes, consider removing this exclusion from your policy.

In addition to the liabilities and losses mentioned above, technology companies also face risks from cyber space claims, network security concerns, privacy allegations, infringement and media liability allegations, etc. While not necessarilly addressed by a Technology E&O policy, these exposures can be covered through endorsements.

The most important take-away from this information is that you need an insurance agent with technology expertise. The more capable your agent is at understanding your business, the more able they will be to secure you appropriate coverage. And a Trusted Choice independent agency is able to quote with multiple insurance companies specialized in your type of risk to ensure not only the best coverage but at the best price.

In addition to his insurance experience, the founder of Keystone Insurance Services, Inc. has an M.S. in Nuclear Physics and has fourteen years experience in technology fields. We are your technology insurance expert. Call us today for a free, no obligation, review of your company’s coverage.

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Professional Liability Claims Triggers

Posted on December 10, 2010. Filed under: Commercial | Tags: , , , , |

If you have Professional Liability coverage, make sure you understand whether it is a “claims-made” or “claims-made-and-reported” policy. The latter can be a trap.

Both types of policies trigger coverage when the claim is made. The difference lies in when the claim must be reported to the insuring company. In a “claims-made” policy, the claim must occur during the policy term and be reported “as soon as possible” or “as soon as practical,” which may be after the end of the policy term. A “claims-made-and-reported” policy has much more stringent reporting provisions, which may cause issues for claims arising late in a policy period if they are not reported before the policy term ends or shortly after.

Take some time to understand your coverage. For Professional Liability insurance quotes, call us. We are located in Austin and licensed in Texas.

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