Posted on Wed, Dec 23, 2009
Did you know that dog bites cause about 800,000 injuries requiring immediate medical care in the United States each year? This statistic is based on research conducted by the Centers for Disease Control and Prevention (CDC). If your dog bites someone, you can be held legally liable. Fortunately, this loss is usually covered by the homeowners policy, with some exceptions. In fact, about one-third of all liability insurance claims paid by homeowners policies are for dog bites! Even if your insurance covers the claim (and possibly the lawsuit), however, imagine the personal grief you and your family would feel for the injured friend, not to mention the time and trouble you would incur in cooperating with your insurer in defending against the claim, following a tragic event involving your pet.
Therefore, preventing such an unfortunate occurrence should be your primary objective, and there are steps you can take to reduce or prevent dog bites. Here are some suggestions from the professionals.
- 1. Carefully consider dog breeds prior to selecting a pet. Some breeds have worse reputations than others, and a veterinarian can help you decide which breeds might best fit your lifestyle.
- 2. Spay or neuter the animal as this often decreases the aggressiveness of dogs.
- 3. Seek a veterinarian's advice quickly if your dog becomes aggressive.
- 4. Socialize your dog from an early age to encourage appropriate behavior.
- 5. Never leave dogs alone with small children.
- 6. Avoid aggressive games with puppies and dogs, such as tug-of-war.
- 7. Do not place your dog in situations where he or she can be teased or feel threatened.
- 8. Train your dog to obey commands.
- 9. If your dog does bite someone, a board-certified plastic surgeon should treat this person to minimize scarring and potential disfigurement.
There is one other loss exposure concerning dogs you should consider. You may face liability claims if your dog gets out into the road and causes or contributes to an auto accident. You can be sued for violation of leash ordinances by allowing your dog to "run at large." Use a well-maintained and sturdy fence or other safeguards to reduce this exposure.
And, if your dog does injure someone despite all your efforts to avoid it, report it to your insurance company immediately to assure your coverage is not jeopardized for late reporting.
Get more personal lines insurance and risk management tips and ideas from IRMI.
Copyright 2009
International Risk Management Institute, Inc.
Posted on Fri, Oct 30, 2009
Is the amount of property insurance on your home correct? What is the appropriate amount of coverage for your home? To begin with, it should be insured for at least 80% of its replacement cost when covered under a standard homeowners policy. Replacement cost refers to the amount necessary to repair or replace damaged building parts with items of like kind and quality. Some insurance companies even require 90% or higher figures when the guaranteed replacement cost option is offered. With this option, the policy pays the full cost of replacing your home, without any depreciation and often without a maximum reconstruction payment. (This gives you added protection if there is a sudden jump in construction costs due to a major shortage of certain building materials. Construction costs often "surge" following large catastrophes, such as hurricanes.) Note that guaranteed replacement cost coverage approaches can vary by state and is not even available in every state.
Many homes are either underinsured or overinsured. For example, some homes insured for long periods of time with one insurance company may have inadequate limits of insurance due to increased building costs. In many cases, homes have been remodeled and improved, and this information has not been conveyed to the insurance agent or company, resulting in severe underinsured home values. If your home is underinsured, you not only have inadequate protection for total losses, but you may also lack full protection for smaller losses.
Sometimes homes are mistakenly insured for their market value. However, market value is normally not indicative of the home's replacement cost. For example, market value also reflects the cost of the foundation and the nondestructible land value, both of which normally survive intact if the house burns to the ground and has to be rebuilt.
In addition, some homes may be insured improperly to meet mortgage company requirements. Some mortgage companies require the amount of insurance be at least equal to the mortgage balance on the house. The mortgage balance is also not reflective of the home's replacement cost, which is often considerably more but can also be less. Insurance companies and agents often struggle in properly educating mortgage companies about these distinctions, but there is nothing to prevent you from insuring to actual replacement cost if that is indeed greater than the mortgage balance. The problem occurs when the mortgage balance is greater than the replacement cost, which will result in the purchase of a higher limit than needed.
The bottom line is that you should work with your insurance agent to determine the correct replacement cost and resulting insurance limit for your home. Most agents use sophisticated replacement cost estimating packages that can fairly accurately determine the replacement cost value of your home. Factors that these programs use to determine this figure include the following.
- Square footage of the home, including its configuration
- Construction costs for your community
- Exterior wall construction type, including frame, stucco, brick, or brick veneer
- Style of home
- Number of bathrooms and bedrooms
- Roof type
- Attached garages, fireplaces, built-in cabinets, and other special features, such as hardwood floors
The more advanced replacement cost estimating programs require detailed information to improve the valuation estimate. For example, a rectangular-shaped home with 1,800 square feet will have a much lower replacement cost than a similar-sized home with an "L" shape. In other words, the better cost estimating programs require information about the number of corners in the home. The more detailed information your agent asks about your home, the more confidence you can place in his or her recommended limit of insurance.
As a final note, you should request an annual review of your homeowners policy to keep up with increasing building supply and labor costs. Also ask your agent about the advisability of adding an "inflation guard" endorsement to your policy or about the availability of guaranteed replacement cost coverage to help assure that your home is properly protected.
Get more personal lines insurance and risk management tips and ideas from IRMI.
Copyright 2008, International Risk Management Institute, Inc.
Posted on Tue, Aug 25, 2009
Does Volunteering Your Time Mean Volunteering Your Insurance?
Millions of Americans donate time-their most valuable asset-to 
serve as a volunteer board member on non-profits, booster clubs, churches, PTAs and civic organizations, just to name a few. The decisions these folks make can have a dramatic impact on their respective organization-and not always for the better. If a volunteer endeavor goes bad, would a volunteer board member have coverage against a lawsuit under his or her homeowner's policy?
Homeowners' Insurance
The last thing volunteers want to consider is what would happen if their favored organization file suit against them as a result of their efforts. But it happens, and not infrequently. This does happen, especially when volunteers make decisions that directly influence the finances of an organization. Often, the only insurance these volunteers have to back their efforts is a homeowner's policy. Unfortunately, this policy may be of little assistance.
The reason homeowners' policies do not usually cover liability stemming from actions as a volunteer is the nature of the claim. The policy is designed to cover claims of "bodily injury," such as someone slipping on cracked pavement in your driveway; and/or "property damage," such as accidentally setting your neighbor's house ablaze when burning some brush on a windy day.
Claims against board members do not usually involve bodily injury or property damage. Rather, they involve bad decision making that results in financial loss to the organization, such as the decision to invest in an IT system that turns out to be a debacle, costing the organization tremendous time and money.
There is another problem. Homeowners policies do not cover "professional services." This is important to note, because board members are often asked to serve in a capacity consistent with their profession. For example, a church member who is a CPA may be asked to serve on the church's board as finance chairman. Even though he is not paid for his services, the "professional services" exclusion under his homeowner's policy would still apply.
In addition to the above, homeowners policies do not cover claims of personal injury unless this coverage is specifically added. Personal injury insurance is added to the homeowner's policy to cover claims such as libel, slander, wrongful eviction, and false advertising.
What to Do
Events causing claims are unpredictable. While the reasons shown above prove it's unlikely, not all claims against volunteer board members are excluded by a homeowners policy. Decisions to purchase personal injury coverage and a personal umbrella policy will increase your ability to find coverage for a suit against you.
The best method for insuring the actions of board members is for the organization to purchase a directors and officers (D&O) liability policy. These policies are relatively inexpensive for most non-profits. Before volunteering, request information on the organization's D&O policy. The absence of this insurance leaves you at risk of having no personal insurance to defend a suit brought against you by the organization and should influence your decision to serve.
Gaudette Insurance Agency, Inc. is a local Trusted Choice® agency that represents multiple insurance companies, so we offer you a variety of personal and business coverage choices and can customize an insurance plan to meet your specialized needs. You can visit Gaudette Insurance Agency, Inc. online at http://www.gaudette-insurance.com/ or call us at 1-800-922-8381.
Posted on Wed, Jul 22, 2009
MySpace, Facebook, Blogging, Emails, Texting ...
The Internet Exposure and Personal Lines Clients
By Irene Morrill, CPCU, CIC, ARM, CRM, CRIS, LIA, CPIW
Vice President of Technical Affairs, MAIA
First ...
If you enjoy MySpace and Facebook ... all power to you. But ... if you see my name listed don't waste your time adding me as a friend ... because I won't go back. A few months ago I was looking for someone ... and the only way to search those two sites is to "join" ... I did, but didn't find the person I wanted ... and have NO intention of going back to these websites!
What you "say" on the Internet ...
Some people put some awful stupid statements in writing. YES ... All of that IS in "writing". Libel ... the things you write ... are easier to prove against you than the foolish things that you say (slander).
People are suing ...
People don't think about these things ... until they get sued ... and even then ... I bet they think that they are covered under their HO policy. Whoops ... guess again!
Did you know ...
In Hermitage Pennsylvania a high school co-principal is suing four former students for creating a "parody profile" on MySpace.com where this principal "admitted to" smoking pot, having sex with students and keeping a keg of beer behind his desk.
Oh, by the way ... this is a FEDERAL lawsuit ...
Could this happen to some of YOUR insured's kids ... to the parents of these kids for "negligent supervision????" And ... if it does ... and your insureds are sued ... will their HO policy respond with defense and coverage?
And ... in another part of the country ... San Antonio, Texas ...
An assistant high school principal filed suit against two former students AND their parents for alleged defamatory statements made on their MySpace.com web page. She is suing for "defamation, negligence and gross negligence" for the "lewd, defamatory and obscene comments, pictures and graphics." She is also suffering because a multitude of miscreants who have viewed"her" page ... and contacted her.
The allegation against the parents contains the following language as "allowing access to the Internet, unsupervised and without restraint poses an obvious risk and unreasonable danger that such children would utilize the Internet for illicit purposes."
For those of you who think ... "kids will be kids" ... this is a tad different than writing nasty things on the bathroom stall doors.
Internet-related Defamation lawsuits increasing ...
106 civil lawsuits against bloggers and others in social networks and online forums were reported in statistics by Citizen Media Law Project at the Berkman Center for Internet & Society at Harvard University. This is up from just 12 in 2003.
What will the unendorsed Homeowners policy do?
The ISO unendorsed homeowners policy covers Bodily Injury and Property Damage liability.
"Bodily injury" means bodily harm, sickness or disease, including required care, loss of services and death that results.
"Property damage" means physical injury to, destruction of, or loss of use of tangible property.
One's reputation is not "tangible property." One who suffers mental anguish and emotional trauma over items "written" on the Internet about them does not suffer "bodily injury" ... at least not in Massachusetts.
So ... if either the named insured or other resident relative writes a defamatory remark about someone else or deliberately writes incorrect information about someone else resulting in a lawsuit ... what will the HO policy do?
NOT MUCH ...
SECTION II - LIABILITY COVERAGES
A. Coverage E - Personal Liability
If a claim is made or a suit is brought against an "insured" for damages because of "bodily injury" or "property damage" caused by an "occurrence" to which this coverage applies, we will:
- Pay up to our limit of liability for the damages for which an "insured" is legally liable. Damages include prejudgment interest awarded against an "insured"; and
- Provide a defense at our expense by counsel of our choice, even if the suit is groundless, false or fraudulent. We may investigate and settle any claim or suit that we decide is appropriate. Our duty to settle or defend ends when our limit of liability for the"occurrence" has been exhausted by payment of a judgment or settlement.
If the suit or claim is not BI or PD ... then the Section II coverage will NOT apply ... and therefore there will be no payment of damages or defense coverage.
What if the insured is NOT "guilty"?
Well ... I guess that's great ... but how does that get proven? If your insured is sued then there will be a court case. Who will pay for the lawyer? If they have a normal unendorsed HO policy ... not the HO carrier!
In today's world of suit-happy individuals the Internet just provides one more mechanism from which potential problems and lawsuits can arise. And now ... so many people have Internet capabilities on their cell phones.
Is there a way to provide coverage for libel/slander situations?
Yup! Actually there are two potential ways.
1. HO 24 82 (04 02 edition) Personal Injury endorsement
SECTION II - LIABILITY COVERAGES
A. Coverage E - Personal Liability
The following is added to Coverage E - Personal Liability:
Personal Injury Coverage
If a claim is made or suit is brought against an "insured" for damages resulting from an
offense, defined under "personal injury", to which this coverage applies, we will:
- Pay up to our limit of liability for the damages for which an "insured" is legally liable. Damages include prejudgment interest awarded against an "insured"; and
- Pay up to our limit of liability for the damages for which an "insured" is legally liable. Damages include prejudgment interest awarded against an "insured"; and
DEFINITIONS
The following definitions are added:
"Personal injury" means injury arising out of one or more of the following offenses, but only if the offense was committed during the policy period:
- False arrest, detention or imprisonment;
- Malicious prosecution;
- The wrongful eviction from, wrongful entry into, or invasion of the right of private occupancy of a room, dwelling or premises that a person occupies, committed by or on behalf of its owner, landlord or lessor;
- Oral or written publication of material that slanders or libels a person or organization or disparages a person's or organization's goods, products or services; or
- Oral or written publication of material that violates a person's right of privacy.
2. Personal Umbrella policy ... might provide such coverage as a broadening applicable over the "deductible"/Self insured retention
In today's world this is a very REAL exposure, and your insureds SHOULD have this endorsement on their homeowners' policy. It is inexpensive and one that I certainly want ... and have ... on MY policy.
Bet you can't believe that the article is so short! Short ... but important.
Have a super day ...
* * * * *
As usual, if I can be of service to you, please call me, Irene Morrill, Vice President of Technical Affairs at 800.870.7091 or ... BETTER YET ... email me at imorrill@massagent.com. You can fax me at 508.634.2929 (but if you fax me, PLEASE email or call me to TELL me that you have faxed me - I am NOT in the office every day).
This article has been developed expressly for the members of MAIA. Reprint by other than members without the express permission of the author is not permitted.