Vacant Buildings at Greater Risk

Vacant buildings can be a lure for unwanted activity. They can be an easy target for theft, a place to party, or a place to find temporary shelter. They also create liabilities for building owners.

Theft is a major concern. Removal of copper wiring or air conditioning units was a common occurrence when the price of copper hit highs a few years back. Vacant buildings are an easy target and can sustain significant damage when wiring and plumbing are removed while systems are active.

“In insurance we call it an attractive nuisance,” says Chris Barnes, senior vice president at LevelFirst. “It may be days before anyone notices damage has occurred, so that damage can be more severe and the loss greater.”

Barnes says that generally vacant buildings need to be protected with the same coverages as occupied buildings, but may require alarm systems, security and even sprinklers to get full replacement coverage.

“Sometimes security systems are required to have theft coverage,” Barnes says.

Senior Underwriter Kate Innocent issues another warning- there can also be liabilities that extend beyond property damage. Property owners can be liable for injuries. While rare, there have been cases where people who have broken into buildings have successfully sued property owners for injuries incurred.

Though vacant buildings are an easy target, there are some measures that can be taken to help protect vacant buildings including keeping blinds closed, not letting mail and trash accumulate, fully draining water lines and keeping lights on a timer.

“Prevention can be effective and proper coverage can protect against property damage and other liabilities” Barnes says. “Vacant buildings owners should know their risks and make sure they have proper coverage before a loss occurs.”

For a more information on vacant building coverage from LevelFirst, contact Chris Barnes at 512-279-4708 or Kate Innocent at 512-279-4714.

Experts Say Catastrophic Gulf Hurricane on Horizon – Businesses May Not be Prepared

On average, two major hurricanes hit the Gulf or Atlantic coasts every three years. Yet the U.S. hasn’t been hit by a major hurricane in more than ten years – the longest streak since record keeping began in 1851.

Experts are chalking it up to luck, and some say that lull has led to complacency. Texans know that even a lesser storm can cause major damage. Hurricane Ike devastated Galveston in 2008. That storm changed course at the last minute, avoiding much worse damage in Houston. Since then, the risk hasn’t subsided, and 2016 could be the year the lull ends and luck runs out. The Texas Tribune recently created an animated graphic showing what the result would have been if 2008’s hurricane Ike had landed 30 miles to the Southwest.

That report concludes Houston’s “perfect storm” is coming and the chances are 2,400 times more likely than being struck by lightning. Moreover, this year El Niño, which typically plays a role in suppressing hurricanes, is expected to weaken significantly or disappear by the start of the hurricane season.

Businesses need to be prepared. Estimates put the number of small businesses that don’t reopen after a hurricane at as much as 40 percent. “Businesses in Gulf Coast communities need to prepare by protecting property, protecting information and making sure they have the proper coverage,” says Chris Barnes, senior vice president at Dallas-based LevelFirst. “The threat is real.”

Barnes says mitigating property damage can include investments in plywood, having the roof inspected and shutting off utilities prior to a hurricane making landfall. It’s vital to back up documents, save legal contracts and store copies in an off-site location. Having wind coverage with a proper valuation is also key. “It will be difficult for a business without wind coverage to reopen after a hurricane,” Barnes says. “Business owners also need to make sure they are insured to value.”

Barnes says many of the businesses that don’t reopen are without insurance or are underinsured. “If you have a business with a $1 million value and are only insured for $500,000, you’re not going to reopen unless you can come up with $500,000. That’s going to be a barrier to recovery.”

LevelFirst offers Wind/Hail-only and Property All Risk along with Earthquake and Flood coverage to commercial properties in the coastal regions of the Gulf. For more information, call Chris Barnes at 512-279-4708. Go here for complete information on preparing businesses for a hurricane.

Cyber Liabilities Loom Large for Small Businesses

Each year new technologies, and improvements on old ones, come along to make our jobs easier.  That adds to productivity for businesses small and large. Today it is easier than ever to store and retrieve personal financial information, but protecting that information poses increasing challenges.  Security in cyberspace is something everyone needs to be concerned about.

“Statistically speaking, just about everyone is going to get hacked at some point,” says John Lucas, business intelligence director at IIAT. “People hack for fun, they do it for profit or they do it just to be disruptive. There is also a large underground market for personal financial information.”

News headlines feature the large corporations that have experienced data loss. However, the risk to small businesses can even be greater. With small businesses, the need for protection against cyber threats may be more easily overlooked. Small firms generally have fewer resources available to monitor and combat cyber threats, making them easy targets for expert criminals. Additionally, the legal requirements for storage and management of data may not be known and experts say small firms can have a false sense of security and believe they are immune to cyber-attacks.

“Even a small agency may have records for 500 people,” Lucas explains. “A breach will make your customers very unhappy. It’s a trust issue.”

A cyber security breach can also be costly. In addition to the disappointment of customers, a breach could essentially shut down a business for a day, a week or longer. There may also be legal liabilities. A business can be held liable if certain data is compromised, not only by hacking but even if a smartphone is lost or a laptop computer is stolen.

“A hacker could bring your business to a halt,” Lucas says. “There could be no way access to email or records.”

One way hackers succeed is through insufficient passwords. Lucas says the best defense is increasing the number of layers it takes to crack passwords.

Using different passwords for every account can be a pain, but it can also prevent a successful hacker from getting into every account. Make sure passwords are long enough. Microsoft suggests a minimum of eight characters. Make them as random as possible, and use numbers, letters, and symbols. Do not use a password based on personal information such as a birthday, and never use words like password or administrator.

Carnegie Mellon School of Computer Science suggests making passwords from a sentence that’s easily remembered such as “I like to eat Dave & Andy’s ice cream.” Then take the first letter of every word in the sentence, include the punctuation so the password becomes IlteD&A’ic.

Keeping backups of data is also important. Automatic backups on cloud servers are one way.

Even with adequate prevention, sometimes hackers succeed, damage and even destroy businesses. Cyber security risk insurance provides added layers of protection.

Some standard business insurance policies, such as a Business Owners Policy, may provide coverage for certain types of cyber incidents such as recovery or replacement costs from a computer virus. Coverage for a fuller range of cyber liability risks is available with a customized stand-alone cyber liability policy which may cover loss or corruption of data, business interruption, identity theft, cyber extortion, and reputation recovery.

“The amount of coverage you need depends on the value of your transactions,” Lucas says, emphasizing that even with insurance prevention is crucial.

“No amount of insurance can totally repair a damaged business relationship,” he says.

For a complete analysis of cyber liability risks and available coverage for your business, call April Moeser at LevelFirst 512-279-4720.

Builders Risk: Protecting Against Construction Fires

Builders Risk insurance is a must for anyone undertaking new construction, building an addition or undergoing renovations. It’s easy to see why, considering scenarios like this:

A worker removing paint with a heat gun ignited an underlayment of the surface being stripped in a 150-year old church. The result was a $4 million loss and a three month delay in finishing the project. In another case, an air bubble in the fuel line of a gasoline-powered pressure washer led to a spill which ignited causing severe burns for the worker and $450,000 in property damage.

“Without coverage, there is no recourse,” says Chris Barnes, senior vice president at Dallas-based LevelFirst. “Fires are a major concern.”

Most often contractors obtain coverage, but Barnes says in some cases property owners will purchase policies. In Texas, Barnes says coverage for frame construction can be hard to find. Coverage for additions can also be difficult because the policy also needs to cover the existing construction.

“If there’s a fire in the addition and it destroys the existing property, that needs to be covered,” Barnes says.

Planning to prevent catastrophe is a necessary component to purchasing Builders Risk coverage. Fires are preventable. Developing and maintaining an effective prevention program on the jobsite that encompasses all phases of construction, repair, alteration and demolition work can go a long way in minimizing risks from fire hazards.

LevelFirst, an IIAT company, offers extensive market capabilities with comprehensive coverage for residential and commercial Builders Risk, including access to markets for frame construction. Call Chris Barnes at 512.279.4708 or e-mail cbarn@iiat.org to find out more. Additional information on preventing fires during construction and renovation is available from the National Fire Prevention Association.

Heath McCasland Named Vice President at LevelFirst

DALLAS— LevelFirst, the service-based wholesale broker and MGA binding facility owned by IIAT Services Co., is pleased to announce the appointment of Heath McCasland as vice president. McCasland will assume the responsibility of brokering new business opportunities within the wholesale brokerage and MGA business units.

McCasland has more than 20 years of experience in commercial insurance marketing, underwriting, and brokerage.

Most recently, McCasland was Vice President, Broker/Producer at USG Insurance Services where he served for more than ten years.

“Heath is an established insurance professional and is well regarded in the industry,” says April Moeser, executive vice president at LevelFirst. “We are excited to have him join the LevelFirst team.”

About LevelFirst
Wholesale Insurance Broker and Managing General Agent (MGA) LevelFirst offers retail clients unique and exclusive commercial insurance products for property and casualty with specialization in habitational, construction, energy, transportation, hospitality, healthcare and financial services. The Independent Insurance Agents of Texas (IIAT) acquired LevelFirst in 2014 to continue its tradition of providing insurance markets for independent insurance agents.

About IIAT
The Independent Insurance Agents of Texas (IIAT) is the nation’s largest state association of Trusted Choice® agencies. IIAT represents approximately 1,700 agencies and more than 14,000 agents and insurance professionals. Trusted Choice® independent agents represent multiple insurance companies. Since they are not employees of any single insurance company, they are advocates for insurance consumers helping them comparison shop for cost-effective and customized coverage. IIAT is also affiliated with the Independent Insurance Agents & Brokers of America and works with legislative, regulatory and judicial bodies in Texas on behalf of independent insurance agents across the state. More information on IIAT can be found online at iiat.org

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Event Preparation Should Include Liability Insurance

Festivals, trade shows, and parties as well as picnics, parades and weddings are events we all look forward to. As with everything, accidents happen and things can go wrong. A serious accident or incident at a joyous occasion is bad enough, but a lack of coverage for such an occurrence can be catastrophic.

Unsure of the need, or on the fence about purchasing coverage, some event planners and promoters have been caught unprepared.

“Any number of situations can arise creating liabilities for event promoters,” says April Moeser, executive vice president at LevelFirst. “Unfortunately, the oversight can be costly, eat into profit, cause serious injury and take the fun out of any occasion.”

In one case an insured event sponsor was directing traffic when she suffered injuries after being hit by a motorcycle. Medical bills and lost wage claims exceeded $68,000. In another case, fake blood was used for a special effect at a high school theater performance damaging curtains in an auditorium and costing $7,500.

While many claims involve accidents, Moeser says many of the liabilities faced involve alcohol.

Moeser describes a case where a guest who had been drinking heavily hit a tractor-trailer head on after leaving a party. The driver suffered severe injuries and sued the host for negligence. The driver’s injuries totaled $300,000. In another case, a minor was served at a brew festival, left the festival by car and struck a utility pole. The minor suffered severe facial lacerations and sued the event sponsor and beer vendor. Medical bills totaled $150,000.

Some protection may be had from other coverages such as homeowners insurance. When using a rented facility, premises liability is typically covered by the venue. In many cases, this coverage will not extend to all related risk exposures.

“If there is a storm and you had to cancel, insurance secured by the venue is not going to cover that,” Moeser says. “You need a special events policy to capture this exposure.”

Special events coverage can add a piece of mind, protect profit and keep unforeseen circumstances from dampening the fun.

For more information about coverage for special events including weddings, festivals, fairs, trade shows, sporting events and more, contact Heath McCasland at LevelFirst at 800-880-7428 x224.