Layoffs during the recession have resulted in a shortage of qualified workers in specialized areas of construction – and the problem will probably get worse as the industry picks up during the recovery. In this environment, some contractors might be tempted to stretch their hiring standards to fill out a project roster, increasing the danger of losses from on-site injuries and defect claims, among other risks.
The past two years have seen a sharp drop in the unemployment rate for former construction workers, but not a corresponding increase in construction industry growth. This means that these workers who have been unemployed are often finding other types of work, becoming full-time students, or have given up looking for a job in the building trades industry.
Because each construction company works in a unique environment and culture, a worker from one firm going to another might not have the required expertise. What’s more, construction is a profession that takes time to learn. Tight profit margins and financial problems can pressure smaller and midsize contractors into cutting corners by hiring inexperienced workers. This increases the risk of on-site accidents and injuries –and leads to poorer quality work that can easily result in costly and annoying defective construction claims (see the article “Construction Managers E&O Insurance: Nobody’s Perfect! ”
In addition as the building industry comes out of the recession, OSHA has become far more aggressive and vigilant in monitoring worker safety.
The bottom line: Avoid the temptation of hiring inexperienced workers as a way to save money, and you’ll keep your risk of on-site accidents and injuries – not to mention your insurance premiums – under control. What’s not to like?
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No matter how large or small the job in the building trade is, it’s always the best policy to carry insurance again liability for losses from injuries, accidents, or property damage during construction.
Residential building contractors need a Liability policy to protect them from lawsuits from homeowners for construction-related losses, or from workers injured on the job. Make sure that your contract requires every sub to carry their own Liability insurance and exempt you from responsibility from damage they might produce during construction. The amount of coverage you need will depend on the size of the contract. As a rule of thumb, it’s wise to have two or three times the size of the project budget.
Commercial contractors usually carry millions in Liability insurance. Contractors with higher risk of damages (for example, roofers or contractors in highly specialized trades) often take out higher coverage.
Your Liability policy will set coverage amounts (limits) for both each occurrence and overall (aggregate) values. Limits are also set for: 1) fire damage to property under construction; 2) medical expenses for injured workers on the jobsite who might not be covered under Workers Compensation; and 3) personal and advertising injury (claims that promotion or advertising caused a financial or personal loss to the owner of the home or building).
While many contractors pay their Liability premiums up front, those with cash flow problems others prefer to finance them through an indemnity corporation with a down payment and monthly payments over six months to a year.
As always, our insurance experts stand ready to help you find comprehensive Liability coverage at a rate you can afford. Feel free to get in touch with us at any time.
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An increasing number of employees in the “Sandwich Generation” are looking for benefits to help them manage the demands of caring for parents and children alike. A recent nationwide survey by the Pew Research Center found that nearly half of respondents in their 40s and 50s have a living parent and are either raising a young child or supporting a grown one.
“There’s an emerging recognition of the impact of caregiver stress on working parents’ ability to be productive at home and at work,” says David Lissy, CEO of Bright Horizons, a provider of dependent back-up care services. “Particularly as families wait longer to have children, there’s more at stake in their careers and they’re pulled in many directions, dealing with the realities of their aging parents.”
On average, access to Bright Horizons allowed employees to work six days during the past six months – productive time that otherwise would have been lost – and nearly 70% of these workers used the service for adult care.
Care.com, another provider of backup care services for employees, saw a three-fold increase last year in the number of clients that added senior care planning. IRobot, Inc. chose Care.com as an employee benefit because “we value our employees and want to support them in managing the demands on their personal lives,” says benefits analyst Cathy Blanchard. Since adding the service, iRobot has seen a 15% month-to -month increase in using the program, which has boosted productivity by reducing costs from care-related absences and distractions.
If you’d like to learn more about offering day care for adults and children as an employee benefit, just give us a call.
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Benefits experts have usually focused on the role of management in implementing programs that improve employees’ flexibility in balancing their life and work. However, researchers are now calling on workers to take the primary responsibility for a creating more flexible daily life by making small, shifts in their everyday behavior.
For example, a survey by Cali Williams Yost, author of Tweak It: Make What Matters to You Happen Every Day,” found that nearly 75% of employees believe that work-life flexibility is only possible if their employer and/or boss provide it. Adds Brad Harrington, Ph.D., executive director of the Boston College Center for Work and Family, “ultimately it’s the individual who must solve this problem, determine their fit, and manage the process of achieving it.
Although more companies are offering flexibility programs and policies that help employees manage such life transitions such as parenthood and illness, Yost and Harrington point out that many workers find it unrealistic to work regularly from home, revise their daily schedule, or use other flexibility options. Even so, they argue, this doesn’t make work-life balance a lost cause.
“Major life events matter,” says Yost, “but it’s the everyday routine we crave and where employees struggle the most with managing work-life fit. Employees themselves need to manage work-life as a daily practice. While this sounds counterintuitive, it starts by thinking small.” She encourages employees to “make small, consistent changes in how, when and where they manage their work and their lives… taking actions that over time build the foundation for a successful work-life fit that transforms their performance on and off the job.”
That’s sound advice to share with your workers
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Unfortunately, you can’t actually see chronic pain. You can talk to someone who physically looks fine, yet is claiming they can barely stand up. Since pain is felt differently by different people, medical professionals and laypeople alike have difficulty categorizing and defining the more severe injuries. This leads to confusion and sometimes outright fraud. Let’s look at how pain is defined by using a specific case study.
A Question of Proof
How injured do you have to be to claim injury? Do you have to be constantly writhing in agony or is it only when you make specific motions? These are specific questions that get a bit touchy. Recently, a man who filed for compensation claimed that he needed a wheelchair but was then shown to be out of his home shopping without it (and seemingly without pain) through video surveillance.
They also had him on camera performing a number of other activities as well. He was arrested with the possibility of up to five years in jail. Since the amount paid out due to his injury was more than a half million dollars, it’s certainly brought about some attention in his area of Florida. The man was a deputy there, and was injured when bending to get his laptop from the trunk of his police cruiser in 2007.
After that, he went through surgery and stated that he couldn’t walk, drive or bend, which has then been shown to be false by videos. He states that he had always been consistent in reporting his pain to be inconsistent because no two days are alike. He says that while the video may show him driving and running errands, he can only do so in limited ways. He claims his whole life is a mess, with his job ripped out from under him and expenses piling up. It’s now up for the courts to decide who has the better claim and what will happen.
Employer Tips
No employer wants to follow their employee around constantly to check up on their progress and verify the truth in their claims. Also, it’s difficult to accuse someone who’s experienced severe injuries of trying to game the system. However, sometimes it’s necessary with the case of chronic pain to be more involved. Medical professionals have been shown consistently to raise costs without cause in certain areas where they have direct financial incentives to do so as well.
Through questions and visits, you can start to see the character of the person behind the claim as well as the treatment they’re receiving. If you do suspect foul play on either side, then your insurance company will be more than happy to help. After all, they stand to lose out on fraudulent claims too.
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Fraud and embezzlement in the workplace has become an epidemic, costing American businesses an estimated $400 billion a year (6% of total revenues), according to The Association of Certified Fraud Examiners. Smaller firms are particularly vulnerable, because they’re less able than their larger counterparts to afford extensive safeguard or to absorb the losses. What’s more, one in four workers who rip off their employers have been with the company more than ten years.
Employee Dishonesty insurance can protect your business from financial loss due to the fraudulent activities of an employee or group of employees. This coverage is also called Crime Coverage, Employee Dishonesty Bond, Fidelity Bond, or Crime Fidelity insurance.
The policy applies to acts by all current and former employees, as well as partners, trustees, and directors, together with volunteers, seasonal employees, and temporary workers under your control. Covered losses can include: 1) theft, robbery, burglary or embezzlement of money, securities, or physical property of the business; 2) forgery or alteration; 3) fraudulent transfer of funds; 4) computer fraud; and 5) counterfeiting cash or money orders.
The amount of coverage you’ll need varies with the loss exposures your business faces. As a rule of thumb, companies that handle cash and securities, need at least 20% of their annual revenue in Minimum coverage for fraud and theft losses is usually $100,000 and many policies will cover $500,000 without significant additional premiums. You can also set specific coverage levels for depositor’s forgery, computer, and funds transfers.
Depending on your situation, you can buy Employee Dishonesty either on a stand-alone basis or as an add-on (endorsement) to your Business Owners policy or other Commercial insurance coverage.
For more information on protecting your business against light-fingered employees, just give us a call.
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