Looking for a true business partner who is interested in helping YOU succeed?

October 25, 2012

When navigating Highway 401 recently, I thought about work.  For me, this is easy and I soon forgot about the stresses of rush hour traffic on a Friday evening.  Driving 350 kms to visit my wife’s family, knowing that I’m going to enjoy a weekend feast fit for a king, also helped; anyone who knows me knows my appreciation of good food accompanied by some fine wine.

 

I can identify almost anything with the business of Risk Management and I saw many drivers who were distracted, inattentive to the point that if I was a member of our “illustrious men in blue”, it would have been so very easy to ticket drivers for violations other than speeding.  Glancing, as a defensive driver, makes it easy to see what vehicles I should avoid – the drivers who tend to stare at their laps instead of the “stop and go” traffic indicated to me that someone is paying closer attention to an electronic device (maybe a Blackberry?) or similar item.  Yes, I did see several drivers looking down for extended periods of time instead of through the windshield.

 

But that is not the reason for writing this.  I realized the last while that I have not been blogging and this has me wondering why?  To begin with, I don’t have a shortage of ideas – on the contrary, I have an abundance of thoughts that could be written about.  So what is my problem?  Is it time management?  I know that I need to set aside time – each day – to write for just a few minutes.  But this is the key item here!  Tweeting and posting to G+, FB, LI, etc. a lead-in to my blog takes much more time than just authoring the original article.  Pinterest is a fabulous tool but, somehow, I need to use it to increase my online visibility even more.  My “learning” about Social Media seems to be the true obstacle but I hope a manageable one that I will overcome in the very near future. 

 

I work with Canada’s “oldest insurance brokerage” but the 21st century brings so many opportunities that I need to relate how to use these technologies in my own business – identify my Vision, develop niches and work with those people and businesses who want my specialized skills and training to reduce their “total cost of risk”, not just their insurance premiums for this year but the risks of operating their business for the short and long term.  I live and work in “Canada’s Technology Triangle” and this means that my own knowledge and training has been focused on IT, Start-Ups and cutting-edge business ideas from Life Sciences to Bio-Tech and Environmental Industries.

 

If you think you have a business that is leading in your field, let’s discuss!  I will work with you to determine what your expectations of an insurance broker may be but also identify areas in which I can assist you with increasing your sales, profits and value.  Isn’t this what you really want from all your business partners? 

 

As an insurance broker/risk manager, I will be your partner because I don’t earn any income/profit from you if you don’t succeed!  As a business partner with you, we both derive benefit – mutual and beneficial, and isn’t this the best way to work with each other?

 

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The Value of Choosing Professionals who Specialize in Reducing your Cost, Risk and Improving your Mental Wellbeing

May 4, 2012

How does the purchase of real estate have anything to do with the above headline and why, as a Property/Casualty Insurance Broker would I wish to write about this topic?

I attended a very informative and interesting function last week where a commercial realtor, home inspector, financial planner, mortgage broker and real estate lawyer spoke.  They knew they had a topic that should generate questions, good attendance and did extremely well in their presentations.  In fact, I even learned (maybe “relearned”) some information that is useful to someone in my own specialized field.  But how does this relate to choosing a Professional?  Let’s answer that as you understand better what is happening with insurance companies.

This week, for example, I see that Intact Insurance is acquiring Jevco Insurance.  What does this mean to the insurance brokerage business and to the consuming public?  A recent new contact commented to me that he hates even thinking about insurance – who doesn’t?  Every time he has contemplated shopping his business insurance, he is told by various brokers that they are not able to assist him because, in our industry, an insurance company will “block” (restrict) another broker from quoting when they have already been approached by one broker (giving a quote or declining to quote) and this is something his present brokerage does. 

Many brokers shop a renewal to all their insurance companies under contract to their brokerage, trying to get the best renewal terms (usually) so they retain the client’s policies.  The commission for one year is never enough to compensate a brokerage for their expenses so it is incumbent on the salesman to ensure he/she doesn’t lose the client to a competitor.  As we see fewer and fewer insurance companies operating due to mergers and acquisitions, this equates into most large brokerages having all the same insurance companies under contract and this could then make any individual dissatisfied due to a lack of understanding.

The business I spoke with is a retailer so that his comment was what one might expect – “If I want to sell Panasonic or Sony to someone and they don’t wish to buy from me but go elsewhere then they could not buy from another outlet?  Does this appear reasonable?” 

Unfortunately, the insurance industry is not as reasonable as other industries because everyone assumes that the commission rate will be identical and their pricing has to, also, be the same when a broker offers terms to the client.  When consulting, it is easier to manage this shopping process but one must be prepared to pay a fee for the consultant’s expertise.  If you are not prepared to pay a fee for this service (only recommended for extremely large premium policies) then you should not permit the broker to operate in such a fashion.  As a consultant, the means of ensuring that any 2 brokerages are being fair and finding the best terms can be established easier, especially since most insurance buyers really don’t understand the differences between quotes and policies.  For smaller premiums (sure we all think we pay high costs for insurance but this is really a matter of opinion) this is not feasible.

My reply to the above retail business was not what I like to say but is what insurance companies feel – that the buying individual or company has chosen the insurance broker as opposed to another broker for the professionalism displayed.  Now this is the one difference of opinion many people will share because they really do buy on price since it is impossible for many people to determine how professional an insurance broker/agent might be, correct?  Unless you can see some distinct evidence – Blogging, Twitter, seminars, newsletters, something concrete – or unless the broker is obviously helping your business in other ways, your dilemma is understood by this writer. 

You can and should ask any insurance broker for what companies have been approached and what the responses are.  As well, you should ask to see a copy of what is being sent to various underwriters in order to determine the accuracy of information being provided.  I have seen where an underwriter quoted a risk, only to withdraw after another broker had explained what the occupancy was.  There is nothing worse than your business description being inaccurate to the point of a claim being denied for the reason that an insurance company would not insure the class of business in which you operate, is there?

The job of a professional is not just to sell but to educate and inform.  For anyone to have mental wellbeing with insurance – remember that an insurance policy is a contract, a “promise to indemnify” – you must rely on a professional to provide you with the best terms and conditions, not just the lowest priced insurance!

If you wish for further assistance, please ensure your comments are added here.

Addressing Reputation Risk, Handling Media and What If?

May 2, 2012

Recently, something came to my attention that I just wanted, desperately, to write about – media and reputation. 

This is an issue that could easily be headlined differently – something really catchy but…I won’t be drawn into what I remember once as media’s goal of shocking its audience to draw attention to an article (yes, I know that a larger audience and readership equates to greater profitability, even with blogging) but I’m not a reporter or editor – only an insurance broker/risk management consultant.  Because my purpose is to educate, however, I will better explain my choice of titles and topics below.

Gay Pornography – does that now catch your attention?  I didn’t wish to headline this article as such but could have easily included in my title since that is how this article came about.  I’m sorry for my version of shock tactics but there was an incident that took place where gay pornography was being broadcast, errantly, in place of regular television programming.  I don’t know if 3 minutes is an accurate amount of time but some media reported it as such – during a cable company’s daytime broadcast schedule (apparently, this was not the fault of the television station but that is still to be determined).  Now that I have explained, let’s commence with my purpose.

Why do I wish to write about this topic or, for that matter, reputation?  Well, I know how difficult it may be to avoid any and every risk in life – it is not reasonable or practical (though I did have a client who, for many years, described himself as “risk averse” and I still continue to wonder how his business remains profitable and expanding, if he truly is reluctant to assume any risk in business). 

What I want to highlight is how reputation and media risk can be handled differently by various individuals or businesses.  The incident that came to my attention did pique my Risk Management curiosity, especially when I read where a similar event like the above recently occurred, in another locale, and was curtailed in a very short timeframe (I read 30 seconds!). 

Did someone, as we say, fall asleep at the switch?  Was the system hacked into?  How could this have taken so long for anyone, working, to notice?  Was there negligence by an employee and/or management?  How will broadcast authorities now respond?  What about the audience?  What feedback will be caused and will there be financial losses due to advertiser(s) being upset and choosing other forms of marketing?  Will the advertiser(s) see adverse feedback from their own customers and, if so, will they seek recourse for financial and reputation claims from the cable broadcaster and/or television station?  You will now see that Risk Management entails a lot of questions – not all have simple responses but require considerable thought, contemplation and planning for what we all hope will never occur.

Let’s imagine any business facing a catastrophe of any kind and then how one is to address the media onslaught (did I forget to mention that the above happening was reported almost instantaneously, online?).  This should be the single most important lesson to be learned by my writing about this.  In somewhat recent local history that I recall, a manufacturer had a disgruntled employee enter the work premises, armed, and subsequently shot some co-workers, injuring and killing people.  Immediately, there occurred bedlam, media frenzy, with the police and emergency personnel responding.  Have you heard of Twitter and Google +?  Imagine your company’s name being mentioned negatively hundreds of thousands of times in a matter of minutes on Social Media! 

By having a plan of action, you could be prepared for the adverse publicity created by such an event and neutralize or maybe even generate positive attention by being pro-active in your management of such an unlikely but potential calamity.

Another incident a number of years ago was the situation with Tylenol.  The manner in which they addressed it – let me remind you that there will always be significant costs associated with any choice in your plan of action – was unique at that time and may now form the template for proactively handling similar events.  Your reputation should be the most important issue when deciding how your company will appear, following the public’s scrutiny and review, and Tylenol did exactly that – they considered their Brand and the value it had.  This will determine your overall future profitability!  You will need to assess the financial and non-financial damage which could impact lender lines of credit, regulatory agencies, sales by competitors, etc.  If you don’t agree that your reputation is of paramount importance in any decision you make or don’t choose to make then why not brand yourself generically?

By planning for the unknown (and, hopefully, what won’t ever take place), one must decide who the best professionals will be and take the necessary steps to devise a plan of action, in conjunction with your senior management personnel, accounting and legal professionals, PR experts, insurance providers, etc.  Why not let me assist you in determining who is best suited to assist your business?  I work with many key professionals who I gladly recommend in the fields of expertise they operate and I work in conjunction with them.

Non-Profit Organizations and Legal Responsibility of the Directors & Officers

February 3, 2012

Today, I had a lengthy and very interesting discussion with a non-profit organization – a prospective new client – concerning the potential for a lawsuit but, even worse, for legal defense costs related to a frivolous lawsuit and how to prevent (well, not really) any suit.  The real reason for our discussion was because the current Liability Insurance policy does not include coverage for certain events and, additionally, the Board doesn’t have any Directors’ & Officers’ Liability insurance protection.

In this particular case, we discussed non-owned watercraft coverage and non-owned automobile risk concerning the support or sponsoring of social activities of the organization.  What if your group agrees to advertise on its webpage that you offer special charter bus trips to a local casino or that you have an annual fun day on the water in a chartered cruise boat?  You think this is a wonderful social occasion that helps bring people together and, maybe, even increase your group’s membership, right?

Now, being the “party-pooper” that any good risk manager may be, think about the consequences of an injury or death.  Many a good lawyer will love to initiate legal action on behalf of the injured or deceased party and will attempt to name anyone and everyone who may possibly (notice this choice of vocabulary!) be involved – directly or indirectly – in the original event that gave cause to the action; this includes the charter operator, your organization and any and all its individual Board members.

Well, as many a person who is uneducated in matters of law and/or insurance may feel, this person stated that their board had felt there would not be any legal ramifications.  He then went on to ask if a signed waiver, prior to the event being held, would eliminate this risk, when I disagreed.  

Please be aware that a signed waiver, if properly prepared by legal counsel, will reduce but never eliminate the risk.  The reason I state this is that anyone can initiate a lawsuit in our society for almost any reason, today.  It is up to the legal system to determine if a waiver will hold up for defense but you will still be faced with legal costs, in the meantime, until a determination is made.  I have read of many instances where a waiver has been held to be valid by certain courts but also many times where the waiver was considered invalid. 

As a “volunteer” who is offering time, experience, etc. to any non-profit group, do you want to be exposed to this financial problem because you and/or your fellow board members didn’t know, especially when lawyer’s costs can be hundreds of dollars per hour to defend you?!  A non-profit Directors’ & Officers’ Liability Insurance Policy can be bought, in many cases, at very low cost, especially when weighing the risk so why not let me know about your own situation and I’ll be happy to discuss with you?  And, if you decide to use another individual to consult, be aware that there are major differences between any 2 “D&O” policies – they are NOT identical!

Student Apartments, Residences, Housing, etc. – NOT Apartments!

September 20, 2011

Any property investor or LENDER in the Province of Ontario, CANADA who has an equity or financial interest in student accommodations should take special care when purchasing, renewing or accepting as collateral an insurance policy – insurance companies do NOT like to insure any properties with multiple students living in any unit.  Many insurance companies decline the class of business so that anyone who is selling insurance through those companies may not be insuring you, whether you hold an insurance policy or not!

If you are reading this and own or lend on student housing where the insurance policy does not identify as such, e.g. shows as “apartment building” on your policy – do yourself a huge favour and ask to have the policy amended by the insurance company – not just the agent/broker.

Some commercial realtors are not yet realizing the predicament in which this places an investor – buyer or seller (and also the realtor) – if you own any of the many student apartments being advertised as such.  And many insurance salespeople are also not aware of the consequences to the client, the firm (brokerage or agency) or the insurance company if written as an apartment building and a claim occurs.  If declined by an insurance company for “material misrepresentation”, our whole industry is tarnished by your oversight and I, for one, do not appreciate hearing of another insurance company claim that was not paid, legitimately or otherwise.

Insurance companies on both sides of the border do not like multiple tenanted risks – “rooming houses” by definition – and most of these student apartments have 5 in each unit; well, how can anyone describe this occupancy in any other terms?  If you don’t wish to take my word for it, please do some research and you will quickly learn and agree with me.

Many of you (I have to take each of you at your word when I hear that Aviva, Economical, etc. are insuring you) have an insurance policy that may not respond to a claim in the event of a loss – property or liability – because the insurance company will not insure “student residences”!  Yes, this is common knowledge among the insurance community so anyone who is insuring as an apartment building had better be extremely careful in dealing with you; do NOT rely on their written evidence that you have an insurance policy but insist on the insurance company showing on the policy or verifying in writing that you have students occupying the property.  There are acceptable insurance markets for this category of risk – Lloyd’s being one, Zurich (yes, we have access for fire-resistant structures through this carrier) and, possibly, others through “subscription” or wholesale facilities.

I specailize in working with investors, lenders and property managers so why not just contact me for advice and assistance to ensure that you do not face the terrible consequences of having an insurance policy but not really having insurance?  I have an appointment this week with someone who thought State Farm still wrote student apartments until they contacted the company to determine otherwise (after I encouraged them to obtain written verification that they do have coverage).

And one final note: ask your insurance professional to explain cancellation when done “ab initio” – it means that you were cancelled as if there never was any insurance policy written.  I am sure that you do not wish for that to happen to you!

Student Apartments – calling all investors, underwriters and brokers – BEWARE!

September 20, 2011

Why is it so easy to lie (well, I am frank – let’s call it “stretch the truth”) when someone asks a question?  I made a phone call that resulted in exactly what I anticipated and an outright “LIE”!  ‘Who do you have that will insure “Student Apartments”?’  This, after I explained that it was a 4-floor building of 7 units and 5 students in each apartment which I know is a “STUDENT ROOMING HOUSE” description – NOT a description for an Apartment Building.

The office I phoned was a smaller brokerage I know that advertises they insure these exact type buildings (I’ve run into them in my travels) and did exactly what they were expected to do – ask me for my information where I was very evasive since I am a competitor of theirs, unknown to them as John Smith.

Because they have a website and a Facebook page, it becomes easier to document what I need to use in a blog of this sort.  There are “X” insurance “markets” showing in total for their firm – this includes Auto, Substandard Auto, Surety, etc.  This means I can eliminate several and a few more who have expressed to us  (Aviva, for example, does not have the property capacity to exceed $1Million, Intact has withdrawn quotes and Economical refuse to insure) that they do not have an interest in insuring “student housing/apartments” of any sort in our geographic territory (I won’t say they do not in other parts of our country or the world because I know they do have smaller percentages of property on subscription policies available through specialty wholesale markets) – Ontario, CANADA.

I will say the broker stretched the truth, unless they were counting wholesale markets when replying to me.  Why tell me one has 4 or 5 insurance companies that will insure this kind of risk?  Either it is a lie to the caller or to the insurance company when describing the type of business when quoting is requested – OK, I will tell you their firm is also a member of an apartment managers association, and, if they were a larger brokerage, may then have exactly what they told me BUT they are NOT.

I will not accuse the brokerage of misrepresenting to the insurance company – I have only seen 1 policy they had in force where I know this may have happened but if you’re a member of an association, would it not be easier for an insurance brokerage to include this sort of property in their portfolio?

What I do know is that there are several insurance brokerages in my territory of operation who have been misrepresenting STUDENT APARTMENTS to the insurance companies as APARTMENT BUILDINGS – and, for those who are not familiar with the differences, they are huge!  An apartment will house a single family or a couple of unrelated individuals – NOT 5 students who are unrelated in EACH apartment unit.  The risk is greater and very significant to an insurance company so why would any insurance company insure for the same premiums as an apartment and 1/3 or 1/4 what Lloyd’s might charge for Student Rooming Houses?  They would not, knowingly!

I have been researching this a great deal – in both Canada and the USA – and will tell you that there is a good likelihood, in the event of a significant claim, you will find you do NOT have any insurance so why pay for a policy that is not going to respond when you need it to?  If you are paying an insurance premium for “fool’s gold”, do you really believe you can collect for “gold” after the loss?  I am not trying to scare business to my door but being very practical and hope that each of my readers understands that.

It would be easy to document for any company underwriter where the streets are (there are at least a half dozen university campuses – Guelph, Laurier, Waterloo, Western, McMaster, Conestoga – within 1-1.5 hour drive of my home office).  Since I am so familiar with the territory, why not ask?  Even Google Maps will assist if you’re not anxious to contact me.  For those underwriters who are not familiar with this simple fact – Economical and Aviva are presently on risk for many of these buildings that they will not and do not insure – HMMMMM!  How many other insurance companies are insuring “multi-family apartments” within 1-2 kms. of an university campus?  Look at Google Maps and check your building addresses and descriptions!

Knowing that the market in the USA is anticipated to grow (and Canada is following suit) where starts were expected to tally as much in 2011 as in the prior 3 years, I fully understand why insurance brokers are targeting this sort of risk but how long before your reputation is tarnished by not disclosing to your underwriters what is being insured?  How long will it be before loss ratios mount and you risk losing company contracts?

Yes, it may be an impossible task for me to educate everyone involved in the buying, selling and investing in the latest real estate craze but I surely hope to try.  Insurance companies do not have to pay a claim or defend you if there is any known “material misrepresentation” and it will then be up to you to decide how to pursue your insurance agent/broker.  What is the cost – both financially and in time – to you?

Try cutting to the root of the problem and discuss with a professional who is expert in the field of student housing.  I await your comments, mail, calls.  And I cover from Ottawa to Windsor and do know the niche!

Insurance – a written contract, credibility and integrity vs. “Material Misrepresentation” and “ab initio” cancellation

September 9, 2011

It is strange to sit here and think about how I should address such a topic as one’s integrity and credibility in the Financial Services field – especially given the global financial meltdown of a couple of years ago and some of the lessons that, as a society, were learned – I thought – at the time.

Unfortunately, I have to be critical of competitors of mine which I don’t really like to do.  The reason is that I have seen something, recently, that brought this to the forefront while I have been contemplating it for the past 1-2 (surely, it can’t be 10-20) years now.

When an individual or business owner wishes to “shop” his/her insurance, how should this be done?  Should research be done into the insurance agent/broker and what degree of checking can they do?  Do you care about the “rating” of the insurance company that is quoting and issuing the insurance policy?  What significance is that to whether a claim – your claim – might be reimbursed?  Can an insurance company not pay a claim?  What is “Material Misrepresentation” and something called cancelling “ab initio”?

I’ve been through some excellent training – yes, even Roger Sitkins may have an excellent approach – but I don’t always agree with what is being implemented (hiring people from outside the insurance industry with various specialties and experience to then sell to those same industries but not really know anything about insurance?).  Might that not give cause for misrepresenting the description of operations (how important can this be?) to an insurance underwriter because of a lack of understanding of the insurance business?

Having seen a number of insurance “contracts” – yes, that is what the policy is and what the broker/agent’s “summary of insurance” (or any other written offer/binder until the insurance policy is issued) is – that do NOT properly address a client’s true “description of operations” is incomprehensible.  For many years, I have known of insurance companies who refuse to quote a submission where a licensed restaurant/facility may occupy a strip shopping plaza or where a portion of a multi-tenanted building is vacant.  And yet, that same insurance company will be insuring many clients in that identical situation!

How can any agent/broker explain to his/her client the reasoning behind this?  I don’t know if it is possible!  As to why one individual will provide a quote from “XYZ Insurance Co.” and that same company has declined similar/identical submissions to another broker?  Well, an important reason can be the information that was provided to an underwriter!  If I describe an apartment building that houses 5 or 6 students in each unit as a High-Rise Apartment Building, will I see the same result as a properly worded submission – “High-Rise Apartment Building occupied as Student Housing”?  Anyone who is familiar with our industry will know that the answer to this question is very obvious!  It is just as apparent to a seasoned veteran as describing a frame building as fire-resistive and we all should know that critical difference.

This week, I was advised by an insurance company that they have a “capacity” of $1,000,000 for property in a specific class of business – meaning buildings, contents, etc. (and $1,000,000 is NOT a large sum of money).  To insure a greater amount will then require obtaining their Head Office approval and the possibility of purchasing “re-insurance” at much higher rates than their normal charge might be – this is not too likely to happen!  They would, in all likelihood, not be competitive, either.  That company, apparently, quoted a competitor of mine (according to a client) for $20,000,000+ in Property values at lower premiums – hmmm?  What does that tell you?  It tells me the insurance company may now rescind that very quote (and I would hate to be the broker having to explain that one to the client – oh, it is easy to say it’s the insurance company’s fault, right?).

And when there is a claim that your (not my) client – I’m now directing this at my competition – expects to be reimbursed by the insurance company, will you be there to explain why – due to “material misrepresentation” – that the insurance company refused to pay?  I surely hope so but tend to doubt it.  Maybe my industry competition will claim that this is a case of my crying over “sour grapes” but I was raised in a family where a handshake meant something and a written contract wasn’t necessary (yes, I know those were the days, as is often said) and credibility and integrity still mean something to me!  Where is your integrity and credibility going to be?

I have known, countless times, of manufacturers who exported most of their product and were not paying suitable liability insurance because the company underwriter has limits for percentages of foreign sales and was never advised that they were exceeded (e.g. 10% when it was 90%!).  One instance, I know quite well, was a Wholesaler/Importer of goods from Southeast Asia where the insurance company was not aware of what the product was or where it was manufactured – and yes, it was “critical”!  Yes, company websites are checked, sometimes, and the info showing can be significant in the event an underwriter is reviewing your quote or renewal.

Having as many years in this industry, as I do, should give some of my clients and prospective clientele a degree of comfort but when another individual can insure someone for not 15-20% less but at 1/3 of my quoted premium, will you be really caring about that?  I surely hope so!  Then again, maybe you will think that insurance is a necessary evil and that nothing will ever happen to you and your business!  GOOD LUCK!

Oh, if you really care to know more about “material misrepresentation”, cancellation “ab initio”, etc., please contact me by your feedback, here or elsewhere, on the many postings I have.  Only then you may find that your provider is not too credible and wish to replace him/her!  But I won’t be waiting with nothing to occupy my time because I do have many clients who want a professional handling their insurance business for them.

Real Estate, Investments, Insurance AND Risk

March 16, 2011

I did not have any notion of writing this blog this morning, when I retired to bed last night, but…a restless night of sleep and here is what I am now doing. Why? Well, I awoke before 4:00 AM, unfortunately (would you believe that my body has still not adjusted to the time conversion from Standard to Daylight Savings so it should still be 3:00?) – alert, for anyone who knows that I am not a “morning person”, I am sure he/she is laughing right now – and started to think of Japan’s devastation and how it might affect us – my business, my clientele – at home, here, in Canada. An hour later, I decided to arise, walk for 30 minutes, visit McDonald’s for morning coffee (while there, reading “The Sun” cover to cover – when was the last time I read a daily newspaper front to back?) and now, 2 coffees later, it is 7:00 AM and I am writing my first blog in several weeks. OK – my grammar may not be indicative of an “alert” individual but I am excited so…please excuse my run-on thoughts.

How does Japan affect Canada and how is it possible that it will have any impact on my clientele? If you reside in Ontario, Southwestern Ontario, the “GTA”, “Golden Horseshoe” or Waterloo Region, invest in real estate or own any business, what am I possibly thinking, eh? Well, I have seen indications that Natural Gas prices are rising around the world – so? Remembering how Hurricanes Andrew and Katrina impacted the cost of building materials – construction items like labour and lumber – following their aftermath, several years ago, made me think about the buildings and contents of my many clients and what other businesses and investors own. Whenever a disaster like this happens, there are worldwide effects on many items.

One example is the manufacturers who import their machinery/equipment from outside the borders of our country – yes, we have seen a large increase in that during the economic recovery of 2010/11 – and watching the value of the “loonie” against the Greenback and Euro on a daily basis. This is something that I like to remind business-people, especially the small manufacturer, about (currency risk) and I don’t know many of my competitors in the insurance sector who ever discuss this with their clientele.

A second example is Trade Credit because what about the many businesses that will not be able to re-open after a disaster such as this? I know that we will not suffer any tsunami, in our interior position in Canada, but there are many other types of disasters we could face and what of our customers? Why would you have Export Development Canada (EDC), which is a fine Government Agency, handle insuring your Accounts Receivable when there may be other options, less costly and/or better, available? Why have a banker insist (most don’t, would you believe?) that you obtain this form of protection because they no longer feel your risk is acceptable to them (and you can be guaranteed that it will be a high risk, long before it gets to this point)?

A third example is that of “Contingent Risks”. I know this does not impact many manufacturers, wholesalers or retailers (really?) but I have 1 client who mentioned something to me (yes, I continue to learn from my clients, too) of his concern in an area that is unique – 60-70% of this firm’s goods are from one American firm and his concern with contingent supplier chain management is with “key person” protection (life and disability) as opposed to the normal Property/Casualty “we” might think about (fire, flood, earthquake, etc.).

Another example is the building owner who “knows” what it costs (OK, I’m now thinking of the builders/developers) who build and own a high-rise apartment building or industrial structure – what if you own several or many properties and would be reconstructing yourself? Do you ever consider what the impact of an earthquake damaging many of your buildings might mean? The insurance company will pay for lost rental income but not if there is a delay in the repairs/rebuilding that might occur if you have 10-12 buildings and are only able to handle 3-4, correct? How will your Lenders – the banks, mortgage companies, life insurance companies, etc. – feel, then? What of the length of term you may then require for “rental income” interruption? I can think of 1 client, in particular, who knows what the constructions costs are of their multiple properties, having extended reconstruction terms for business interruption, but has not addressed the potential for increased reconstruction costs – this is something we will be addressing today – and a partial but significant loss is much different than a total loss (remember that term “co-insurance”?).

Realtors – yes, I am targeting my friends in the community at CB Richard Ellis (Dietmar Sommerfeld, et al.), Mr. Benjamin Bach, DTZ Barnicke, Colliers and Coldwell Banker/Peter Benninger, etc. (gee, I hope I am now getting some internet hits for this J) – that know which of their clients should think about this in a manner different from “tradition”. I am NOT the traditional insurance broker but a broker who emphasizes Risk and discusses Risk Appetite with my clients.

Bankers and lenders – I know you cannot direct business but keep this in mind when you are funding your loans! Some requirements are reasonable, others are not and you can refer to me for advice on what is and should be required by you.

Lawyers – you should well know of your Errors and Omissions exposures when handling legal matters but why not assist your clients in providing for all their professional requirements?

I do wish to state that my prayers are with the Japanese at this time and I hate to use their disaster as an excuse for my writing this blog. I am ill when seeing the images of their recent and ongoing sadness and I choose this word because I am at a loss for a proper description of what they have faced. I hope the world will come together like we have never seen – and help you rebuild your ravaged country.

What a difference a year makes?

January 21, 2011

It was not that long ago, or so it seems, that we were in the midst of a severe recession and it was so very difficult to find work – profitable work – to handle. Most of my efforts were spent in planning, looking ahead, researching and continuing to learn about this interesting (yes, I did use that description) and ever-changing business of Insurance and Risk Management. During the last half of 2010, it seemed that something changed and the first month of 2011 indicates that I am looking at the best year I’ve seen in many. Don’t ask why because I was taught to only change bad behavior, not good habits and that’s what I plan to do – continue with my exceptional behavior and results.

What are we seeing in the Canadian, particularly Ontario, Commercial Insurance marketplace? As I have found out, it is not worthwhile for businesses that are doing anything different (hmmm, what do I mean by different? OK – stores and offices) to try and obtain their best coverage and premiums from smaller insurance brokers.

Examples include Accountants who require Errors & Omissions insurance like one I insured this week. They had office insurance with a broker who was able to offer as “normal” a policy as anyone (I use this term because I do feel offices are easily written by most people in our industry) and their E&O coverage through another broker. This other broker was familiar with a Lloyd’s market offering such coverage and both brokers are losing because they missed the chance to cross-sell the client. Where else have they missed that I have not? The firm has referred a client, a manufacturer, to me who has already purchased one policy and will be moving another five or six policies during the course of this year and I plan to cross-sell personal insurance to the accountant, too.

If you’re in the Engineering or Architectural sector, we now have an eager market offering coverage and would enjoy quoting on your businesses, including Errors & Omissions Liability.

Another example is a large developer/investor in properties who was never offered personal or commercial umbrella insurance by their prior agent and brokers (yes, they were insured with multiple firms). I have met with the client on numerous occasions to discuss the many different exposures they face and have moved most of their business during the past six months with the balance to come during 2011. The client even made a phone call to a business partner on one of their projects to introduce me and insist an appointment be given to me. Saving the client 20+% from their prior year’s insurance costs did not hurt, either, especially when they were paying in excess of six figures. We have now developed a program for this class of business and have been insuring several other property owners in this field of endeavor.

For anyone in the pursuit of unique business opportunities we can obtain superb coverage for you. I wrote a golf simulator’s insurance at rates that were exceptional, especially when compared with what he had been offered elsewhere. I am working with another insurance broker who is unable to offer coverage to two of his clients in construction due to a lack of competitive markets with other brokers, one being a residential multi-family project and the other performing single family renovation and remodeling. A new client, whom I have known for many years, has placed their High Value Home (with some unique requirements) through me. As noted in a prior blog or one of my social media announcements, I have written a Flea Market Vendor, Student Housing properties, a Residential Mover and many different types of business entities.

With the markets we have available to our brokerage, we can write Martial Arts Studios, Fitness Clubs, Tanning Studios, Hobby Clubs, Spas, Vacant Properties, Sports Bars, Franchises, Cargo, Marinas, IT Professionals, Contractors Pollution Liability, Directors & Officers Liability – the field goes on and on. Just let us see what you do and we’ll do our best to offer a package of protection that you will be pleased to purchase.

I attended a seminar this week and was astounded to hear my competition discuss how difficult their lives have been – being declined and policies being non-renewed, rates increasing, etc. If you’re not thoroughly pleased with your policy/provider, I suggest you contact me immediately at larryewinsurance@gmail.com .

Have a great 2011! I know I am and will be.

Commercial Insurance (for a wide range of industries and business classes)

January 18, 2011

Discussing insurance and thinking of selling insurance always seems easy for me, natural, but when I review the many different types of risks that can be insured, I almost stop in bewilderment!

For example, I was just reviewing an e-mail from one of our markets and here is a sampling of the unique classes they insure for us:

  • Individual personal trainers;
  • Fitness studios;
  • Mixed martial arts;
  • Injectable treatments like botox and collagen;
  • Lipo-laser operations;
  • Laser hair reduction;
  • Teeth whitening;
  • Tanning salons

If that is not a diverse enough sampling, I am happy to try:

  • Demolition contractors;
  • Environmental remediation and abatement;
  • Restoration and emergency spill response;
  • Environmental consulting and assessment.

Or maybe:

  • IT consultants;
  • Website developers;
  • Network support services;
  • Software developers;
  • Data storage/retrieval services;
  • Web hosting services;
  • Computer training.

And if that is not your “cup of tea”, how about:

  • Builders risk and wrap-up liability;
  • For-profit and not-for-profit directors and officers liability;
  • Professional errors and omissions/malpractice liability;
  • Environmental liability;
  • Surety including bid and performance bonds;
  • Trade credit/accounts receivable;
  • Employee dishonesty/fidelity bonds;
  • Product recall expenses;
  • Umbrella liability;
  • Contingent business interruption of a customer or supplier;
  • Franchising, nationally and internationally.

If you are operating a business in Ontario, CANADA – why worry about finding a suitable insurance provider? Avoid worry, save time and guarantee yourself peace of mind by dealing with knowledgeable and reputable providers – broker(s) and insurance companies. Don’t look further than here – A-rated insurance carriers with Canada’s oldest insurance brokerage. We specialize in Commercial Insurance so you don’t need to do the same!

If you operate a franchise in Canada that has franchisees in Ontario, we can provide coverage nationally and internationally, for you. There are many different types of policies available and we have the necessary experience to recommend the one best suited for you.

I can be reached at larryewinsurance@gmail.com

I hope you have as wonderful a year as possible. I am certain to do the same.