Business Insurance

Every business has unique requirements
Your commercial insurance should be designed to protect against the most prevalent risks, to the assets and capital in your business. Your broker can help you itemize and quantify those risks, and determine the level of coverage you should consider. Risks include:

• Property loss. Insurance against property damage or theft protects the physical assets that support your business including buildings, equipment, vehicle fleets and inventory, as well as intangible assets such as licenses, patents and accounts receivable. To arrange the right level of insurance, you must know your rights and obligations as an owner, tenant, leaseholder, landlord or mortgage holder. You must also take into account local bylaws on standards for physical repair and reconstruction
• Liability loss. Every business is exposed to liabilities and should be protected against the minor as well as the major ones including personal injury, product failures or negligence.
• Personnel loss. Group health and benefits insurance can help to improve employee retention and well-being thereby reducing the cost of turnover and lost time.
• Net income loss. Some businesses are exposed to specific perils that are beyond their control and that would cause critical damage to the viability of the business.

  For example, a food services operation might insure against a major electrical outage that would result in spoilage of their inventory.

Consider the underlying risk drivers in your business
An experienced commercial insurance broker can help you read the risks in your business, advise you on how to reduce some of the more manageable exposures and suggest an insurance mix that takes your risk tolerance and financial situation into account. The following are examples of common risk drivers:

• Heavy reliance on limited sources of income
• Dependence on one or a few people to run the business
• Elaborate and specialized physical assets
• Extensive international operations
• Sensitivity to factors outside your control, such as weather and commodity prices
• Labour unrest
• High levels of inventory
• Large vehicle fleets
• Rudimentary workplace health and safety practices
• Dangerous materials handling

Business Interruption
This form of insurance provides you with the funds required to protect your business's financial position if your operations are interrupted by an insured loss such as a fire. Features and costs will vary considerably depending on whether you insure for named perils, a specific timeframe, specific costs or just a portion of the income you lose.This form of insurance is highly customizable and can include coverage for extra business expenses, rental income lost, gross earnings lost, payroll and professional fees.

Consequential Loss
A consequential loss is not caused directly by damage to property, but is a consequence of other damage. For example, a cold storage facility might experience significant inventory losses if an on-site transformer station failure cuts out electricity supply or a fire damages the refrigerators. A greenhouse operation or a winery might require constant temperature and humidity to be maintained. Consequential loss coverage would insure the resultant damage caused to stock by an insured peril that changes these factors.

Equipment Breakdown
Many named perils and broad commercial property insurance policies will exclude coverage of breakdown or damage to highly sensitive or specialized equipment including high-pressure boilers, control systems and computers, diagnostic equipment and more. Special machinery policies can be obtained to cover equipment for sudden and accidental breakdown, which is advisable if loss of use is a significant risk for your business.

Errors and Omissions and Director's and Officer's Liability
It is common practice to protect company directors and senior managers from personal liability for actions that are the responsibility of the company they direct.While insurance does not remove their fiduciary duty, it does provide some financial protection from legal liability for a claim made against them for an alleged or wrongful act.A wrongful act is any error, misstatement, misleading statement, act omission, breach of duty or neglect allegedly committed or attempted. Errors and omissions insurance is usually used in professional services firms such as law, accounting and consulting to protect professional staff from the impact of errors and omissions in their work.

Cyber Insurance
Cyber-insurance is an insurance product used to protect businesses and individual users from Internet-based risks, and more generally from risks relating to information technology infrastructure and activities. Risks of this nature are typically excluded from traditional commercial general liability policies or at least are not specifically defined in traditional insurance products. Coverage provided by cyber-insurance policies may include first-party coverage against losses such as data destruction, extortion, theft, hacking, and denial of service attacks; liability coverage indemnifying companies for losses to others caused, for example, by errors and omissions, failure to safeguard data, or defamation; and other benefits including regular security-audit, post-incident public relations and investigative expenses, and criminal reward funds.

Specialized Coverage
There are as many forms of specialized coverage as there are risks to your business. A broker can help you assess the probability of experiencing a loss and determine whether or not you should purchase specialized coverage. Talk to your broker to see if there are risks unique to your business that require extra protection. For example:

• Crime - designed to protect against loss of money or securities, may include theft overnight or on the way to the bank.This also includes employee dishonesty.
• Electronic Data Processing Systems - protects your computer and its data.
• Sewer Back-up - covers loss or damage caused by the backing up of sewers, sumps, septic tanks or drains.
• By-law Coverage - covers additional expenditures resulting from by-laws regulating construction when rebuilding a building after a loss.

These are just a few of the special coverage's available for special situations. We give us a call to review more.

An experienced commercial broker knows how to identify and manage many of the risk factors in your business and translate that knowledge into a cost-effective risk management program. There are four key steps:

1. Know your risk exposures
   The first step is to accurately identify and analyze the risk exposures to your tangible and intangible property, your income, personnel and liabilities. These can be determined in a thorough audit of your office, warehouse or shop floor to identify all perils, probabilities and potential financial consequences.
2. Consider the risk management alternatives
   Insurance is one form of "financing" your risk, but there are other alternatives to explore. These include eliminating the exposure, loss prevention, loss reduction and contractual transfer of responsibility for losses, for example, when a lessee assumes the liability for damages to leased space. A thorough risk management plan will examine all these alternatives before getting to the issue of insurance. Commercial insurance is the most widely used of all risk financing techniques because of the cost-effective protection it provides. General and specialized policies can cover just about any peril. Another way to manage risk is to be financially prepared for a loss. One way to do this is to accumulate your own capital reserves to cover the loss, but this can tie up large amounts of capital at low rates of return.
3. Implement your plan
   With loss prevention and reduction plans in place, your broker can help you implement your insurance program with one or multiple insurers.
4. Monitor and adapt your plan
   Make sure to adapt your plan to match the changes in your business including geographical expansion, physical growth, new lines of business or increased complexity. Consider an annual review of your needs with the help of your insurance broker.

Don't just manage your insurance, manage your risk...
...A bit of planning and an ounce of prevention can save you time and money.

The short answer is yes, and the best way to know what is covered is to talk to your broker.

More and more people are starting home-based businesses, for everything from marketing homemade products to keeping a home office for a consulting business. From an insurer's perspective, this adds new types of risk to your home, and therefore, may require additional insurance.

Residential policies provide limited coverage on business property
Anything you use in running your home-based business is subject to the limits of insurance and/or might not be covered at all. Be aware that:

• Dollar limits apply on business property, computer and software. This limit might be as low as $2,000 in total, which would not cover even the most basic home office.
• Your policy might completely exclude any special equipment that you keep in your home for business purposes.
• Items that are covered for business use are only covered while in the home. So, for example, if the computer you use for your home-based business is stolen while on a trip, it will not be covered.

Some home businesses may require added liability insurance
The operation of your home-based business might mean that you have more people coming and going, and therefore, more risk associated with the activities in your home. If this is the case, not only will a basic liability limit of one million dollars likely not cover you, but also, some insurers might refuse to cover a third party claim by a customer or employee who is injured in your home. If you think this situation applies to you, be sure to tell your broker about your home business and make sure your insurance company is made aware of your home-based business activities.

Let us know
If you participate in a timeshare using your home, or you rent out your cottage, you should consult your broker. These activities represent an increase in liability and risk to the property and will more than likely require additional coverage.

Your insurer considers an unoccupied dwelling riskier than an occupied one.

Depending on how long you are away from your home, you need to make arrangements to ensure your dwelling is checked regularly, especially through the heating season. In some circumstances, you may need to inform your insurer.

When away for a short time
If you will be away from your home for fewer than 30 days, you do not need to inform your insurer. However, you do need to arrange for a competent person to look in on your home everyday or two to make sure that everything is in good order. If a deep freeze and/or a broken furnace results in exploding pipes and water damage that goes unnoticed for several days, your insurer could refuse to cover the costs if no one was looking in on the house.

For longer absences
If you are away for more than 30 days, your home is considered "unoccupied" because you plan to return. In this case, you should contact your broker to determine whether you will need to inform your insurer and obtain a special permit to leave the house empty. You will still need to arrange regular checks on the property, and you might want to consider draining water pipes and installing a good security alarm system.

If the property is empty
A fully vacant property is one with no occupants and no contents. This may occur if a house sale is delayed and the property remains vacant until sold. In this case, you need to obtain a vacancy permit from your insurer. This permit will maintain most of your coverage, except for risks associated with vacancy such as broken water pipes, broken glass or vandalism. These permits can be obtained for up to three months.

Traveling?
Personal items covered by your home, condo or tenants insurance are also covered when they are temporarily away from these locations, for example, when you are traveling. Items belonging to a dependent temporarily living outside your home to attend school, for example, may also be covered. Contact your broker to discuss how your policy addresses your situation.

Other items such as those used for home-business items, however, will require additional coverage