Insurance and Off-Road Vehicles: What Your Clients Think They Know Can Hurt Them

Summertime is right around the corner, and for many of your clients, off-roading is part of the fun. But as they pull an all-terrain vehicle (ATV), dirt bike, golf cart, or dune buggy, etc., out of the garage and onto the trails, people often give little thought to the risk exposures. The fact is, the costs associated with an ATV accident that is not protected by the proper insurance coverage can be high, resulting in expensive lawsuits involving property damage, liability claims and medical expenses.

Every year, there are over 100,000 emergency room visits by people involved in an ATV accident, with injuries that range from bruises to severe fractures. In 2019, the CPSC reported approximately 295 deaths that year due to ATV-related accidents.
 Source: Consumer Product Safety Commission

Homeowners insurance and ATVs
The No. 1 misconception among policyholders is believing that their home insurance policy will cover their off-road vehicle. The truth is that most homeowners insurance policies will specifically exclude coverage for off-road vehicles of all kinds — especially when the vehicle is driven off of the insured’s property. You can explain to your clients that much like coverage for a motorcycle, an ATV requires a separate insurance policy. However, because a homeowners policy will provide coverage for accidents that occur on the insured’s property, there may be some liability protection if an incident occurs on the premises, but that depends on the individual policy. 

Coverage under a personal auto policy
It is an all-too-common misconception for an insured to think that his or her personal auto policy will automatically extend to an off-road vehicle and provide protection. Again, the answer is no. Policyholders need to know that their personal auto policy will only provide coverage for personal vehicles that are insured under the auto insurance contract. Policyholders need to understand that without liability coverage, they could be putting their assets at risk in the event of a serious accident. This can be a great opportunity for you to offer them a separate ATV insurance policy to ensure they have the coverage they need. While policies will differ, most standard ATV insurance will include bodily injury liability, bodily injury property damage, comprehensive and collision coverage.

Take note!
In many states, ATV insurance is required by law. However, even if there are no insurance requirements in your state, you should consider offering ATV coverage to your clients, as there is a higher risk for injuries with these vehicles because they are ridden on rough terrain.
Source: Progressive Insurance

Conclusion
ATV insurance, along with safety precautions, can ensure that your clients have the coverage they need to hit the trails without worry. This summer season, consider sending an email update or policyholder newsletter that addresses these common misconceptions regarding insurance coverage and off-road vehicles.

About FastrackCE
Do you need to complete your continuing education credits this summer? At FastrackCE, we make it easy for insurance professionals to maintain CE licensing requirements conveniently online. For information, call 800-544-3605 or visit fastrackce.com.

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Summer Get-Togethers: How Exposed Are Your Clients to These 3 Risks?

After two years of pandemic-related restrictions, we are all long overdue for some serious fun this summer. But before the temperature warms up and prior to people start hosting family reunions, graduation parties, weddings and neighborhood get-togethers, consider reaching out to your policyholders to remind them that the following three exposures could expose them to a liability claim situation.

Tipsy guests

Hosting a gathering and serving alcohol comes with certain risks. In states where social liability laws exist, a homeowner can be held financially liable for injuries to a third party caused by an intoxicated guest who leaves his or her home. In addition, the injured third party may also file a civil claim against the host. In states that don’t enforce this type of social host liability law, a personal injury case can be filed against the homeowner.

A common question among homeowners is whether an intoxicated guest can sue the host if he or she gets in an accident after leaving the party. According to the legal website NOLO, that answer is almost always no. Even in states with more relaxed social host laws, the liability typically only extends to third parties who are injured due to the guest’s actions. The only time a guest who is injured in an alcohol-related accident may file a lawsuit against the homeowner is when a minor is injured — even if the minor caused the accident.

Tips to pass on to your homeowner clients

· When serving alcohol, also serve food.
· Provide a wide variety of nonalcoholic beverage options.
· Stop serving alcohol at least two hours prior to the end of the party.
· Consider a social host liquor liability insurance policy.
· Collect the keys of those who plan to drink.
· Encourage ridesharing.
· Offer a place to stay overnight after the party ends, such as a spare bedroom, couch or inflatable mattress.
· Insist that guests have a designated driver who abstains from drinking alcohol during the party.
· Hire a professional bartender who can stop serving visibly intoxicated individuals or alert the homeowner to potential issues. 

Unpredictable pets

Loud noises and strangers can put a family pet on the defense. From a nippy 3-pound Chihuahua to an 80-pound Rottweiler that jumps to an angry cat that doesn’t want to be picked up, homeowners need to ensure that family pets are safe and secure during an event. When put in a new social environment where people are eating and children are running around, even the most well-behaved pet can demonstrate out-of-the-ordinary behaviors.

Even though the liability coverage under a homeowners and renters insurance policy will typically cover liability legal expenses in the event of an injury by a pet, the amount covered only goes as far as the policy’s limit. Should a claim exceed that amount, the homeowner will be responsible for all damages. When talking with homeowner clients, consider taking the time to discuss the importance of having adequate liability insurance on their policy, as well as the added protection that a personal liability insurance policy can bring.

Tips to pass on to your homeowner clients

· If pets must be present during an event, consider using a muzzle or leash for them.
· Request invited guests to please leave their own pets at home.
· Inform guests that there are certain rooms in the home where pets are secured for the duration of the party, and that they shouldn’t be entered.

Yard hazards

Trampolines, swimming pools, swing sets, slides and treehouses make for a fun summer party — especially for the children of guests. Add to the mix fire pits, grills and sprinkler systems and there is an increased risk for guest injuries. A quick assessment of the property prior to the party can help to eliminate the chance that someone will get hurt.

If a guest is injured at the party and the host is determined to be at fault, most homeowners insurance policies will provide some degree of legal liability protection. However, coverage will only go as high as the policy limit. Again, this can be a good time to review liability limits and umbrella insurance with your homeowner clients. 

Tips to pass on to your homeowner clients

· Rope off areas where guests could trip over sprinkler heads.
· Designate a cooking area when grilling that is away from designated play areas.
· Establish safety rules for using certain amenities such as trampolines, swimming pools and treehouses. For example, proclaim that children cannot enter a pool area unsupervised.
· Keep all walkways clear, and if the party runs after dark, make sure these areas are well lit.
· Consider purchasing a one-time special event insurance policy when hosting a party to provide a higher limit of coverage for personal liability.

Conclusion

Whether you are writing a new homeowners insurance policy or have a book of existing homeowner clients, helping your policyholders understand how their insurance works, its limits and how to mitigate potential summer party risks comes with the job. Feel free to pass these tips onto your homeowner clients or put these ideas in your agency newsletter. They’ll thank you for it and may even invite you to the party!

About FastrackCE

Do you have a busy summer planned but still need to complete your continuing education credits? Don’t worry! At FastrackCE, we make it easy for insurance professionals like you to maintain current CE licensing requirements online and at your convenience. For more information, call 800-544-3605 or visit us at fastrackce.com.

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Evolving With The Risks: How Insurers Are Adapting to Growing Cyber Threats

As cybersecurity risks intensify, insurance companies are doing their best to adapt. However, staying a step ahead of hackers is proving to be an ongoing and often uphill battle, creating issues for insureds, insurers and reinsurers. Here we’ll take a look at cybersecurity trends impacting the insurance industry, how insurers are adapting and what’s ahead.

“The lack of historical loss data [in the cybersecurity insurance market] (resulting from the sector’s short history) adds another layer of unpredictability for all involved.”
Source: Harvard Business Review.

Meeting the demands of the market

Industry experts have concerns that the increase in cyberattacks could increase the demand for insurance coverage and create a supply problem. According to the Harvard Business Review, this is pushing insurers to become overly cautious when offering coverage for certain new business risks, and could also result in an increase in non-renewals that could further reduce capacity.     

An informational disadvantage

The cybersecurity liability market may not be new, but in many ways, it is still in its early stages. This has challenged insurers, as there is a lack of historical claims data in the cybersecurity market from which to draw when assessing, pricing and placing risks. As more losses are incurred in the cyber liability space, we may see more insurers reducing or withdrawing coverage in sectors where they haven’t been profitable.

Growth in ‘bring your own device’ risks

COVID-19 may have initially prompted more employees to work remotely, but it’s clear that this trend isn’t going away anytime soon. With no way of predicting that these new working arrangements would become “the new normal,” insurers that provide cyber liability insurance now find themselves sitting on ongoing risk exposures — primarily due to employees using their own devices and networks to conduct company business. These arrangements have insurers looking at how they can better accommodate these and other developing cybersecurity risks for employers that have elected to adopt hybrid work models.

So, what’s next?

In light of the growing threat of cyberattacks, more businesses this year are taking it upon themselves to adopt a zero-trust architecture when it comes to their cybersecurity requirements. According to Analytics Insight, “[These security capabilities] will be based on the principle of ‘Never trust, Always verify’ (i.e., treat every user, device, application, workload, and data flow as untrusted).”

“Increased automation of [company] data can [help] eliminate risk points and better support a zero-trust strategy.”
Source: Analytics Insight.

Reinsurance News notes that the increase in claims due to ransomware attacks has also prompted significant advancements in underwriting. This includes viewing cybersecurity risks from the attacker’s perspective in order to better understand how and where risks are occurring.

“The cyber insurance industry has evolved significantly over the last 12 months deploying rate changes, coverage restrictions and more robust underwriting practices.”
Source: Reinsurance News.

Conclusion

The influx of cybersecurity risks that initially prompted the insurance industry to provide businesses with a wide spectrum of cyber liability insurance, has the industry facing new challenges. And while this shouldn’t be a cause for alarm, agents should be aware of the changes to come so they can better advise their clients.

About FastrackCE

Need to complete your insurance continuing education credits before the end of the year? FastrackCE can help you get all your life and health and property and casualty continuing education credits done in one place and at your convenience. We offer online courses in most states, covering a broad range of topics, including most of the state-mandated courses such as ethics, flood, long-term care and annuity training.

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Mission Critical: Addressing Wildfire Risk Coverage With Your Homeowners Clients

Over the past five years, the wildfire season has been dreaded by those who live in fire prone areas. From the growing number of wildfire events to the increased severity in intensity and size, it’s clear that these climate-induced, apocalyptic weather conditions aren’t slowing down any time soon.

Wildfires cause damage to over 60,000 structures across the states, costing around $14.8 billion in property damage in 2021 alone.
Source: Restoration USA.

Last year, smoke and ash from wildfires blanketed many areas of U.S. neighborhoods. According to EMBROKER, the narrative for homeowners has dramatically changed due to the distinct probability of wildfires occurring closer to well-populated areas in what looks to be an annual occurrence. 

This year, homeowners in wildfire-prone regions of Colorado, California and other areas, are staring disaster in the face once again. This has prompted homeowners to have a conversation with their insurance agent to better understand whether and how their property is protected. The following can help you be better prepared to assist your policyholders this fire season.

Today, nearly 10% of Californians live in high-risk fire zones. In the event of a loss, the current inflation rate and the cost of time and materials to rebuild has only exacerbated the problem.

As homeowners begin to rebuild, researchers predict that to replace homes in California’s high-risk fire zones could cost an estimated $610 billion.
Source: Mercury News.

• Review and check policy coverages and limits with your client to ensure there is adequate replacement cost for coverage A (the home), coverage B (other structures, such as detached garages, sheds, fences, etc.) and coverage C (personal property, such as clothing and furniture). Are there any new items of value that were acquired during the past year? Get them scheduled onto the policy.

Review the definition of loss of coverage (also known as additional living expenses) and how it is used to help coverage expenses such as hotel costs, food, pet boarding, etc., should the homeowner become displaced due to a fire. This is valuable coverage and something that your policyholders may not be aware of.

Discuss fire preparedness. The website Ready.gov has a comprehensive online fire preparedness guide your homeowner clients can download that lists specific tasks to better safeguard their property and mitigate risks in the event of a fire. 

If you have homeowner clients who reside in a high-risk fire area and who are unable to obtain wildfire damage coverage under a standard insurance policy, help them pursue coverage under the Fair Access to Insurance Requirements (FAIR) plan. The specifics of each plan will vary from state to state, but all plans require licensed property insurers to participate in the pool and share in the profits and losses. A list of FAIR plan administrators in each state can be found here.  

Discuss the importance of fire alerts in helping them evacuate to safety — and to do so as soon as possible. The simplest way to register for local alerts and warnings is by using Wireless Emergency Alerts (WEA). Alerts are sent by the National Weather Service and are short emergency messages that are broadcast from cell towers to any WEA-enabled mobile device in locally targeted areas.

Lastly, advise your policyholders that in the event of fire damage, they need to report a claim as soon as possible. Can they file a claim at your office, or is there an option to report the claim directly to the carrier? Be sure to provide them with the information they’ll need should a claim occur.

When homeowners suffer from a loss, such as one related to a wildfire, it’s important for them know that their insurance professional is there to help them through the claims and recovery process. By reviewing policies early in the season, you can help your insureds be better prepared to mitigate potential risks. 


About FastrackCE

Have you waited until the last minute to complete your continuing education credits? Don’t worry! At FastrackCE, we make it easy for insurance professionals like you to maintain current CE licensing requirements online and at your convenience. When you need us, we can help. For more information, call 800-544-3605, or visit us at fastrackce.com.

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5 Steps for Implementing a Successful Diversity, Equity and Inclusion Strategy

In part one of this article, we discussed the importance of business owners implementing diversity, equity and inclusion (DEI) in the workplace. Here, in part two, we’ll focus on steps that your business clients can use to get started with their DEI initiatives.

Turning talk into action

It’s not enough for businesses to just say that they support diversity in the workplace. Today, they must implement proactive steps to ensure that their DEI initiatives are not only doable, but sustainable. 

According to the Center for Creative Leadership, creating a diverse workplace requires an intentional approach that includes the following five action steps:

· Break down existing boundaries. Simply put, this is about spanning the business to map out and remove the unintentional biases that may exist. For example, are there groups of individuals, teams or branches of the business that aren’t accessing and setting DEI goals? Knowing where potential gaps exist allows the business to take actionable steps to break down boundaries and build connections across the organization. 

· Review recruiting, hiring and promotion practices. Businesses must examine their employee development and hiring practices. The Center for Creative Leadership notes that a good place to start is with management and team leaders, asking questions to evaluate best practices and policies to reveal potential ways in which bias may be creeping in. For example, are assumptions being made about individuals’ current capability and future potential? Are different standards being applied to some individuals or groups?

· Put social identity under a microscope. Social identities are labels that people use to categorize or identify themselves or others as members of specific groups (e.g., generation, nationality, profession, sexual orientation, socioeconomic status, gender). Businesses can no longer ignore this problem and must be proactive in uncovering potential issues. The unfortunate truth is that social identity groups are at the root of unequal power or privilege. Identifying and correcting social identity issues that may exist is a vital step for businesses in creating a successful DEI work environment.

A social-identity lens can help [businesses] spot situations when actions and decisions may be rooted in unconscious bias or when it is unintentionally shutting down diverse perspectives.

Source: Center for Creative Leadership, Understand Social Identity to Lead in a Changing World.”

· Have meaningful, open conversations. Every person at every level of the business needs to be part of the DEI conversation, stressing the importance of creating a culture where there is increased openness, respect for differences in others and understanding. A good place to start a diversity conversation is with upper management and supervisory teams.

· Implement a coaching culture. Business owners can’t be everywhere at once. By establishing DEI mentors, businesses can create a network of coaches in all areas of the company to help foster diversity and the growth of all employees.

Conclusion

The ability to shift mindsets, behaviors and processes in the workplace isn’t an easy task. Business owners already have a full plate of daily responsibilities that can push implementing DEI initiatives to the back burner. However, taking small steps today can result in a big impact tomorrow.

About FastrackCE

Have you waited until the last minute to complete your continuing education credits? Don’t worry! At FastrackCE, we make it easy for insurance professionals like you to maintain current CE licensing requirements online and at your convenience. When you need us, we can help. For more information, call 800-544-3605 or visit us at fastrackce.com.

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