We previously discussed a basic term life policy, but there are riders that can add important coverages to your policy. 

What is a Rider?

Riders are additional benefits that can be added to your life policy for an additional premium. Not every life insurance company offers every rider, but here are three of the most common riders and their benefits.

1. Accelerated Death Benefit

An insured person can use a portion of the death benefit (usually between 25% and 50%) if he or she is diagnosed with a terminal illness that will significantly shorten the insured’s lifespan. The total death benefit would then be decreased by the amount that is accelerated upon the insured’s death. That means, if you are diagnosed with a terminal illness, you would be able to withdraw part of your death benefit early to help you get your affairs in order, pay off loans or medical bills, or just enjoy a vacation with your family.

2. Waiver of Premium Rider

The Waiver of Premium rider waives future premiums if the insured becomes permanently disabled or loses his or her income as a result of injury or illness. Most insurance companies, impose a 6 month waiting period from the time of disability until the first premium is waived and the rider usually expires at age 65. So, you keep your policy with no further payments unless you are able to work again or the rider expires at a specified age.

3. Child Rider

This rider provides a death benefit in case a child dies before a specified age. When the child reaches the specified age, the rider can be converted to his or her own permanent life insurance policy without the need for medical exams. Note that the premium for this rider is usually the same whether you have one of ten children.

Life insurance can offer a gift of financial security to you and your family, and by adding appropriate riders to your policy, you can tailor it to meet your specific needs. Ask your life insurance professional to help you build a life policy suited to you.

This past Saturday evening over 1000 people came to Manheim, PA to celebrate the 2nd annual ”Taste of Manheim”. The event gave visitors an opportunity to “taste” food from local restaurants, participate in several family activities and setup lawn chairs in the middle of the downtown square to watch a movie on a 30 foot screen.

As one of the participants in the downtown event, Baron Insurance Group sponsored a “Green Screen” booth staffed by a team from PhotOle Photography. At the booth visitors could choose one of several photo backgrounds, add fun accessories and strike a pose for a free photo (see example photo above).  

To see all the Green Screen photos taken at the event Click here.

Thank you to everyone for making this a fun and memorable event!

Manheim Square Prior to the event starting

Poster provided by Brian Ober

Green screen team from PhotoOle

Nevin Spade & Chris Vogt working hard

Sporting some of the green screen props

Dancing entertainment

Lots of family fun

Picking up finished photos at the booth

Professional face painting

The youngest visitor of the night

A 30 foot movie screen!

Movie watchers filled the streets

Without proper documentation even a great insurance policy won’t get you an easy or, potentially, full claim settlement.  That is why it is important for homeowners and renters to maintain an updated home inventory.

Taking a Home Inventory

The easiest method to take a home inventory is by taking digital photographs or shooting a narrated video. If you don’t have any type of camera, just buy a $10 memory card and ask to borrow a friend’s digital camera. Make sure to open all cupboards and closets with the drawers open. Don’t forget storage areas, the garage and any detached structures like a shed.

For more expensive items like televisions and electronics, make sure to take close-ups of the model and serial number and keep sales receipts. Also take close-ups of any custom structural elements like built-ins, stone fireplaces or exposed woodwork. Remember that certain big ticket items have insurance limitations and they may need a separate policy.

The most important part of a home inventory is to store it online or a safe place outside the home. It completely defeats the purpose of a home inventory if the media that it is stored on gets burned in the fire too. KnowYourStuff.org is a great resource that offers a free online software that makes creating and keeping a home inventory easy. They also have a short video showing how to record a home inventory.

Having a major house fire or robbery is stressful enough. Take 30 minutes to create a home inventory and make sure you have adequate proof prior to a major claim.

If you are a business with employees or a business that works with third parties (customers), you should become familiar with this acronym.   

Employment Practices Liability Insurance

Do you hire or fire employees?  Has anyone heard the latest “news” around the water cooler?  Do you perform employee reviews?  Do you provide raises or promotions?  Do you or your employees interact with customers or vendors?  Have you ever told a joke at work?

All of these things can lead to an Employment Practices claim.  What is an Employment Practices claim?  Any claim of actual or alleged abuse, harassment, failure to promote or provide a raise, inappropriate hiring or firing, the list goes on.

Lawsuits involving race, retaliation, and harassment make up the top three Employment Practices claims.  There are also lawsuits alleging wrongful termination, failure to promote, being offended by a joke…  You’re getting the picture.

Of course, many of these claims could prove to be groundless.  However, defense costs alone could end up costing major dollars, possibly up to $50,000.  Without Employment Practices Liability Insurance you could be left paying out of your own pocket.  Wouldn’t you rather dip into an insurance company’s pocket?

Studies show that it is more likely for your business to suffer an Employment Practices loss than a General Liability or even a Fire loss.  Are you prepared?

The Equal Employment Opportunity Commission website, www.eeoc.gov, has excellent information regarding laws and regulations pertaining to employers.  The Home Page even gives examples of recent lawsuits and how they were settled.  It’s an eye-opener!

Employment Practices Liabilty Insurance can provide you with the protection you need.  Limits can be purchased to include defense costs and claims brought against you by a third party, such as a vendor or customer.  You can also buy a policy that provides defense costs in addition to the coverage amount.  It’s not too late to find out if your insurance agent can provide you with this coverage.  It’s a call worth making, and it’s insurance worth buying.

             It was an enjoyable drive to the location.  It became a small adventure finding my way there and getting to see some open rural sections of Lancaster Co. that were unfamiliar to me.  Once there, entering the doors for the event, there was a buzz about the atmosphere that was energetic.  First impressions are important and my first moments were very positive.  My energy level continued to rise from just about everyone that greeted me.  It continued upon entering the social room for coffee and a pastry (or fruit for the healthy types).    To experience the chatter of attendees already in the room and the accommodating individuals at my table continued to add to the morning.

                Technology is amazing!  Being at a remote site was no barrier to communicating with the main location.  There were texting opportunities to ask questions.  There was an opportunity to give to a worthy cause through your cell phone as well as purchasing items for sale.  All this interaction could be accomplished from your seat at the telecast.

               But it was the telecast from Atlanta that made the day.  Each individual speaker and interview gave me something new or, at minimum reinforced things, already being done in business and my personal life.  There was something very refreshing to hear the “giants” in their professions talk openly, even passionately, about respect, hard work, compassion for others and character.  It was almost a pep talk like my college basketball coach would give before a game!    Some presenters actually fired me up.

          There were some takeaways too!  The presenters that connected the most with me caused me to order their latest books from Amazon.  Author Jim Collins’ presentation created a desire to really look at how things are done at b.i.g. on a daily basis.  He urged us to look at our business model and ask “What are we to STOP doing?”  Moving ahead is not so much a matter of our circumstances but our choices in a dynamic business environment.  Thus, there are times we must look at some things we do and “Stop”.  How we provide service or communicate with customers may need revised.  Our business model may be outdated and, as a result, we may have to stop doing something altogether.  It might be necessary to look for alternative ways to accomplish goals or to empower and entrust others to keep going forward.  The need is to move forward, always!

                At each of our places of business or personal lives, perhaps a break-through may come if we would “Just Stop It”.

Misconception 1: I Don’t Need Insurance because My Business is Too Small

Most people do not consider their hobby or part-time work from home as a business since it is not their main source of income. Thus, they do not even realize that they need insurance for a home based business. If you answer yes to the following 3 questions, you probably have a home based business along with all the risks and rewards associated with owning a business

- Is it a trade, profession, occupation or hobby

- Is it full-time, part-time or occasional

- Is the activity engaged in for money or any other type of compensation

Misconception 2: Doesn’t My Homeowners Insurance Cover My Home Based Business

Homeowners insurance policies were never intended to cover business exposures. The purpose of the homeowners policy is to protect insureds during personal activities. Neither the coverage nor the premium charged is intended to cover a business activity exposure. Thus, most homeowners insurance policies have very limited coverage for most home-based businesses. Below are the common business coverages and exclusions offered on most PA homeowners insurance policies

- No business liability coverage of any kind –no on-premises liability, no-off premises liability, no products liability, no professional liability, Workers Compensation liability, etc.

- No coverage on any detached structure, for example a shed or garage, if used even partly for to conduct business

- Minimal coverage on business property such as computers, fax machines, filing cabinets, tools and inventory – typically $2,500 in your home and only 10% or $250 away from home

What are My Insurance Options for a Home Based Business?

The insurance solution for a home based business is unique for each situation but most can be protected by using one of the following.

- Incidental Business Endorsement – Depending on the type of business and insurance company, you may be able to add an endorsement to your homeowners insurance to extend liability insurance for your home based business. This coverage usually costs around $30-$50 per year but it only covers on-premises business liability only.

- Businessowners Policy (BOP) – A BOP is a package policy that is designed to provide property and liability coverage for some small businesses. Generally, small businesses whose activities or operations involve processing and/or service are eligible for a BOP. Manufacturers, especially with complex liability issues, are not suited for a BOP. A BOP policy can cost as little as a few hundred dollars and it has several optional coverages that can be tailored to fit an individual business.

- In-Home Business Owner Policy – Some insurance companies offer a policy that combines a homeowner and BOP into a single policy and are designed specifically for home based businesses. The policies eliminate gaps and duplications in coverage and the rates reflect the in-home status of a business.

Don’t Risk A lot For A Little

Millions of Americans are operating a home based business without knowledge that they have little or no insurance protection. In the event of a loss, they could be underinsured or uninsured leaving them personally liable. The solution to reduce or eliminate this potentially devastating risk is simple and can cost as little as $30 per year. Don’t risk a lot for a little!

Are you sure if you are covered by home based business insurance?

Who Must Purchase Workers Compensation Insurance?

The Workers Compensation section of the PA Department Labor & Industries’s (DL&I) website says, “If you employ workers in Pennsylvania, you must have worker’s compensation insurance - Its the law.”

That seems clear enough but how do you know if the person you are employing is actually an employee or a subcontractor?

Before I answer that question, I must point out that the PA DL&I website goes on to further describe who does and does not need coverage, as well as provides examples of the penalities incurred for employers who fail to provide coverage even though they should have. Also the PA Insurance Department website has a nice piece of information titled “Your Guide to Workers Compensation Insurance.” If you’re in business in Pennsylvania, I suggest you check it out.

The IRS Test

The best way to answer the question as to whether you have an employee or a subcontractor is by using the “IRS Test“. Basically, a subcontractor is defined by the IRS as a person whom you have the “right to control or direct only the result of the work and not the means and methods of accomplishing the results.” Whereas a worker is an employee if you “can control what will be done and how it will be done.”

The IRS test consists of three main catagories to review regarding how to classify your worker: behavior control, financial control and relationship of the parties.

Behavioral Control – This section deals with whether you demonstrate a “right to direct or control how the worker does the work.” Examples are type of or level of instruction and/or training afforded to your worker

Financial Control – This section deals with “whether there is a right to direct or control the business part of the work.” Examples are whether there is significant investment in the work or who is responsible for a majority of the expenses incurred.

Relationship of the Parties – This section deals with “how the business and the worker perceive their relationship.” Examples are employee beneftis and written contracts.

In many cases, the control you demonstrate over a worker, along with your relationship with that worker, can determine how to classify them. Take a look at Publication 1779, “Independent Contractor or Employee”. The document details the three catagories, as well as lays out several questions you can answer to help you better understand how to classify your workers. How you answer the questions in this publication can go a long way in determining whether you need to purchase a workers compensation policy.

In conclusion, determining whether a worker is a subcontractor or an employee can be difficult task. Each situation is unique and a local insurance agent is always a good source to answer questions or help with navigating any of the aforementioned websites. Are you sure if your business has contractors or employees?

NAIC Complaint Data for Erie Insurance Exchange

Insurance is an intangible service. It cannot be sampled, tested, touched or recycled. Thus, most people purchase personal and business insurance on the only tangible factor they can measure…PRICE. Although price is a major factor when purchasing insurance there are other factors that need to be considered when choosing the right insurance company.

One major factor to consider is if people are happy or satisfied with an insurance company. The last thing any customer wants, is to pay an insurance company for months or years and be disappointed when they have a problem or a claim. Thus, the National Association of Insurance Commissions (NAIC) compiles complaint data on nearly every insurance company and the information is available to the public!

5 Simple Steps to Get the Complaint Data

1. Paste the link https://eapps.naic.org/cis/ into your browser

2. Under the Company Search for Complaint and Financial Information section on the top right side of the page, enter your insurance company’s name. Then select PA as the Consumer’s Resident State and click the “Find a Company Button”

3. Click on “Closed Complaints Link”

4. Click on “Closed Complaint Ratio Report”

5. Select the insurance type (Ex-private passenger auto) and click the “Create Report” button

At this point you should have a report similar to the one shown in the picture above. The report shows an insurance company’s complaint ratio compared to a national median of 1.00. Any complaint ratio below 1.00 means the company is better than the median company and any company with a ratio above 1.00 means that they are worse than the median company.

Take advantage of this consumer data and find out what customers are saying about your personal or business insurance company…you may be surprised!