As a farmer or rancher, you may produce a variety of products. Maybe you grow grain, flowers or fruit, raise cattle, horses or alpacas, or manage fish ponds, chicken barns or a custom farming fleet. A farms/ranches business owners policy is essential for protecting your livelihood.
What is a Farms/Ranches Business Owners Policy?
A regular homeowners’ policy covers your home if it’s damaged, and it may give you some liability coverage. This policy won’t give you the protection you need for your farm or ranch business, outbuildings or livestock, though. You need a specialized farms/ranches business owners policy with several layers of protection.
What Does a Farms/Ranches Business Owners Policy Cover?
Farm and ranch owners may customize their business owners insurance policy. In general, your farms/ranches business owners policy covers:
House – Repair or replace your farm or ranch house and any possessions
Liability – Cover medical and legal expenses you may incur if someone is injured while visiting your farm or ranch.
Livestock – Receive financial reimbursement if your livestock are stolen, attacked by dogs or wild animals, accidentally drown or are shot, suffer electrocution or die during a natural disaster or collision.
Machinery and equipment – Replace damaged, lost or stolen tractors, wagons and other machinery and equipment you own, borrow, rent or lease for farm or ranching activities.
Structures – Cover farm/ranch structures, including barns, pens, fences, silos, machine sheds and other buildings, that may be damaged, stolen or vandalized during a weather incident or other incident.
Additionally, you may customize your farms/ranches business owners policy with a schedule that’s based on your specific farm or ranch operation. If something on your farm or ranch is not listed on the schedule, it may not be covered if it’s damaged, lost, stolen or vandalized.
Ask your insurance agent about these optional coverages, too.
- Accidental Direct Physical Loss
- Amendatory Deductible on Cab Glass
- Chemical Drift
- Custom Farming
- Crop Dusting
- Equipment Breakdown
- Extra Expense
- Fire on Growing Grain
- Hired Auto
- Incidental Business
- Limited Pollution Liability
- Loss of Earnings
- Seasonal Coverage
Where do you Buy a Farms/Ranches Business Owners Policy?
A farms/ranches business owners policy is a valuable investment. To purchase a policy, talk to your insurance agent. Discuss your unique needs, business and budget and create a policy that’s right for you. For example, you may choose a policy with high liability limits if you conduct school tours on your farm or ranch, and the size of your farm or ranch affects the amount of coverage you will buy.
A farms/ranches business owners policy gives you peace of mind and valuable protection for your home and your business. Understand what it is as you operate your farm or ranch.
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Ever since the first ride-sharing app debuted in 2011, they’ve experienced exponential growth in usage. In fact, in the cities where such apps have joined the market, taxi ridership has declined anywhere from 10 to 30 percent. However, while the popularity of ride-sharing apps is increasing, so is the host of risks associated with using them. Most of the companies are in the stages of infancy, and the situations they’re facing are in uncharted territory.
How the Apps Work
While they’re most commonly referred to as ride-sharing apps, any company that uses an online platform to connect passengers with drivers (using the driver’s own vehicle) is called a transportation network company (TNC). These companies each have their own unique differences, but they all operate under the same basic concept.
Through their smartphones, passengers are matched with available drivers via GPS. Most apps display the driver’s route and estimated time of arrival, in addition to the driver’s name, photo and vehicle information. The TNC gets a cut of the fare, typically between 20 to 25 percent, for each ride a driver completes.
The apps are convenient for passengers and for drivers looking to supplement their income. Still, they’re not without flaws. For example, it can be difficult to determine what regulations the TNC and its drivers need to follow, what insurance coverages apply to them and who is considered liable in the event of an accident.
When Insurance Kicks in
Since TNC drivers use their vehicles for both business and personal purposes, TNCs have to clarify when drivers are covered by different types of insurance.
When a driver is driving with the TNC app off, the driver is not accepting rides, so the driver’s personal auto insurance is the primary coverage. When the driver turns the app on, but has not yet accepted a ride, TNCs generally offer contingent liability coverage if the driver’s personal auto insurance does not offer protection. When a passenger is picked up, the TNC’s policy is the primary policy until the end of the ride.
State Involvement
Unlike taxis, which are regulated by the city and have to follow strict guidelines, TNCs haven’t had to adhere to the same strict regulations. This is beginning to change, as legal concerns have grown. Some states are enacting laws to set standards and insurance requirements for TNCs. Furthermore, cases that are currently in the courts will help shed light on who is to be held liable in ride-sharing accidents in the future.
Driver Risks
Some ride-share companies provide liability insurance for their drivers in excess of the driver’s personal liability coverage. However, this does not mean that the driver will always be covered.
Drivers also face the risk of being dropped by their insurance company if they’re found to be misleading them. Drivers need to be honest about what the primary use for the vehicle is when they obtain the policy. If a driver fails to indicate the intention to drive for commercial purposes, the insurer could not only deny claims, but also drop the driver from the policy. Some insurers have created hybrid policies that allow drivers to switch between personal and commercial coverage for that same reason.
Passenger Risks
When a passenger gets into a car arranged by a TNC, the passenger agrees to a host of terms and conditions by default. If the driver gets into an accident and the passenger is hurt, there is no guarantee that the driver’s insurance company, nor the TNC, will pay for damages. For example, the driver’s personal insurance company may say that he or she was driving for profit and, for that reason, it is not required to pay the medical bills. The passenger would need to take the driver to court for damages, which can be a costly and time-consuming process.
Safety is a concern for both the driver and for the passenger. A driver never knows the type of person about to get into the back seat. Likewise, a passenger only knows how reliable a driver is from what the TNC shares about the driver on its app.
However, no transportation service can guarantee safety, and the same concerns arise for people who take taxis. But if something happens to the passenger in a taxi, he or she may receive monetary compensation without having to go to court.
Tips for Passengers
Using a ride-sharing app is generally a safe and reliable method of transportation. Nonetheless, there are safety risks to consider. If your employees use ride-sharing apps when they travel, make sure they’re aware of the following safety tips:
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- Share your trip details with someone. Some apps allow you to share your route and driver information.
- Before you get in the car, check that the driver’s photo, name and license plate match what’s listed on the app. Never enter a car with
a driver who claims to be with a TNC and offers you a ride.
- Never share any personal information that the driver does not need to complete the ride. This includes phone numbers, as TNCs typically anonymize their passengers’ phone numbers to protect their privacy.
- Always wear your seat belt. If the car you’re riding in doesn’t have one or appears to be unsafe, instruct your driver to cancel the ride. Be sure to report it to the TNC immediately.
While the TNC insurance landscape evolves to meet the safety needs of drivers and passengers, insurance companies are taking different approaches to claims. Consult with Scurich Insurance for information on new and changing regulations and to be sure you and your employees are always covered.
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Home Maintenance for the Summer
Keeping up with seasonal repairs and upkeep not only shows pride of ownership, but can reduce the risk of costly and preventable home expenses. Prepare your home for the summer with the following considerations:
Home exterior
- Check all window and door locks to make sure they are secure. Open and close them, and apply lubricant when they are hard to open.
- Inspect your roof and gutters, clean out gutter debris and check shingle integrity.
- Inspect your home’s foundation, sealing cracks and levelling yard depressions with compacted soil.
- Check wooden structures, such as decks and steps, for rotting, loose wood or exposed nails.
Home interior
- Hire a qualified heating, ventilation and air conditioning (HVAC) contractor to tune up your air conditioning unit.
- Examine electrical outlets and cords for potential fire hazards, such as frayed wires.
Garage
- Examine your garage door to ensure that it is in proper working order.
- Declutter by reviewing the contents of your garage. Donate or dispose of items you no longer use or need.
Driveways and walkways
- Inspect your pavement for cracks and holes, and remedy them. This can go a long way in preventing accidental slips, trips and falls.
Painting Safety Precautions
Summer is the perfect time to brush up on painting projects in your home. While paint can beautify a room, it can also be harmful to your health.
Stay safe while painting this summer with the following tips:
- Test for lead with a lead-testing kit—especially if your home was built before 1978.
- Wear a respirator, and open windows and doors to ventilate the room.
- Wear protective gloves and clothing.
- Cover all exposed outlets with painter’s tape.
- Inspect your ladder’s integrity before use, if applicable. Make sure to always have at least three body parts in contact with the ladder at all times.
- Store paint by replacing the lid firmly and storing the can upside down to block air entry.
ATV Safety
As warmer weather approaches, more people will be using all-terrain vehicles (ATVs) for recreation. While riding an ATV is a fun activity, these vehicles can be extremely dangerous. In fact, every year, there are over 300 ATV-related deaths across the United States.
Here’s how to keep yourself and your family safe while operating an ATV:
- Read the operator’s manual and attend ATV instruction classes before riding.
- Wear gloves to reduce vibration pressure and to improve grip.
- Wear boots to maintain balance and control, protect feet and legs from debris, and maintain sound footing.
- Wear a long-sleeve shirt and pants to avoid burns and scratches.
- Always be aware of your surroundings. Watch out for wildlife, pedestrians, other ATVs and hazards like rocks, branches and unstable surfaces.
- Drive at safe speeds, taking weather conditions and the terrain into account.
- Never carry additional passengers, or operate an ATV while under the influence of drugs or alcohol.
- Always ride the right size ATV by following the manufacturer’s recommendations.
Reducing Choking Hazards for Small Children
Choking occurs when the brain goes without oxygen for more than four minutes, causing brain damage and death, and is the leading cause of death in infants and toddlers.
If you are the parent or guardian of a small child, it is your responsibility to protect your child from danger. Foods such as hot dogs, whole grapes, nuts, raisins, hard candies and popcorn can be potential choking hazards. Other choking hazards include household items such as latex balloons, coins, small toy parts and marbles.
Protect your child from choking with the following tips:
- Mash foods so they can be chewed more easily.
- Instruct children to chew food before swallowing it.
- Make sure children sit upright while eating.
- Always supervise your child during mealtime.
- Do not give hard foods to children under the age of 4.
- Avoid giving children toys with small parts, and keep small household items out of reach.
Make sure to also learn the Heimlich maneuver for infants, as the procedures for a choking infant are different from those of an adult. Learn the steps here.
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Employee Drug Use Reaches 12-year High
The positive drug test rate for the U.S. workforce was 4.2 percent in 2016, according to the Drug Testing Index (DTI) released by Quest Diagnostics. This represents a 5 percent increase over the positive rate in 2015, and the largest single-year positive rate since 2004.
The DTI analyzed over 10 million workforce drug test results from 2016 and categorized employees into three categories, including employees with federally mandated drug tests, the general workforce and the combined U.S. workforce. Here are additional details about the DTI’s findings for specific drug types:
- Marijuana—The positive test rate for marijuana increased nearly 75 percent in oral fluid testing, which is used in the general workforce. Federally mandated marijuana tests only utilize urine tests, and the positive test rate increased 10 percent in 2016.
- Cocaine—Positive test rates for cocaine in post-accident drug tests were more than twice as high as pre-employment screenings.
- Amphetamines—Positive test rates for amphetamines have risen 64 percent between 2012 and 2016 for the general workforce. Quest Diagnostics attributes this increase to the prevalence of prescription drugs, including Adderall.
In order to create a safe, productive workplace, you need to watch out for potential drug use at your business.
Political Discussions Hurt Job Performance
Many people can get worked up about politics, but a new survey from the American Psychological Association (APA) has shown that political discussions in the workplace can have a big impact on your employees’ job performance.
The APA surveyed U.S. employees about the impact of political discussions after the 2016 presidential election, and found that these discussions have a detrimental effect on job performance and relationships with co-workers. The survey found that 40 percent of employees have experienced a negative outcome following a workplace political discussion, such as reduced productivity or difficulty getting work done. Additionally, 24 percent of employees said they avoid some co-workers solely because of their politics.
According to the APA, social networks and constant news reports can cause individuals to adopt an “us versus them” political mentality, which can lead to conflict. As a result, it’s important to encourage respect, collaboration and courtesy in your workplace to ensure that your employees feel supported and remain productive.
New Executive Order Aims to Improve Cyber Security
President Donald Trump recently signed an executive order to improve the country’s cyber security and protect key infrastructure from cyber attacks. The order also emphasized the importance of strengthening the cyber security of federal agencies. According to a survey from Thales Group, a cyber security company, 34 percent of federal agencies experienced a data breach in the last year, and 95 percent of agencies consider themselves vulnerable to cyber attacks.
The executive order did not create any ongoing cyber security requirements, but instead laid out goals to assess the current state of cyber defenses and develop deterrence strategies. Here are some of the requirements of the executive order:
- Federal agencies must draft reports on their ability to defend themselves against cyber threats.
- The departments of Energy and Homeland Security must assess potential vulnerabilities to the country’s electrical grids. The executive order specifically mentions that prolonged power outages could pose a threat to national security or damage the economy.
- Various federal agencies must review the cyber defense plans of U.S. allies in order to cooperate during international cyber attacks.
Apple Creates $1 Billion Fund to Support U.S. Manufacturing
Apple, the world’s largest technology company, recently announced that it will create a $1 billion fund to support U.S. manufacturing. Although the company is based in the United States, it has faced criticism for outsourcing most of its manufacturing and taking jobs from U.S. workers.
Apple’s CEO stated that one goal of the fund was to support smart manufacturing and to create a ripple effect in industries that support smart manufacturers. For more information on the manufacturing fund, visit Apple’s website.
DID YOU KNOW?
A U.S. Court of Appeals recently barred the Federal Aviation Administration (FAA) from requiring recreational drone owners to register their unmanned aircraft. The FAA had originally required recreational drones to be registered in order to help identify aircraft that posed a hazard, and to pass on safety information to operators. However, the court’s ruling will not impact the use of drones for commercial use, as these aircraft must still be registered with the FAA before they are used.
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On May 15, 2017, the Centers for Medicare and Medicaid Services (CMS) announced significant changes to the Small Business Health Options Program (SHOP) Exchanges under the Affordable Care Act (ACA). Under these changes:
- Employers would be able to obtain an eligibility determination for SHOP participation through www.HealthCare.gov.
- Employers would enroll directly with an insurance company offering SHOP plans, or with the assistance of an agent or broker registered with the Exchange, instead of enrolling online at www.HealthCare.gov.
CMS plans to issue regulations implementing these changes, effective Jan. 1, 2018.
ACTION STEPS
These changes apply in federally facilitated SHOPs (FF-SHOPs) and state-based SHOPs using the federal platform. State-based SHOPs could continue to provide online enrollment or adopt the federal direct enrollment approach.
SHOP Exchanges
The ACA required each state to establish an online competitive marketplace, called an Exchange, where individuals and small businesses may purchase health insurance, beginning in 2014. The SHOP is the Exchange component for small businesses.
Online enrollment in FF-SHOPs was previously delayed until Nov. 15, 2014, as a result of problems with implementation. Prior to Nov. 15, 2014, employers had been required to use a direct enrollment process, using an agent, broker or insurer to enroll their employees in FF-SHOP coverage for 2014 (similar to how most small employers previously got insurance).
Many state-based SHOP Exchanges chose to offer online enrollment earlier than the FF-SHOP, in 2014.
Ending Online Enrollment in FF-SHOPs
The changes announced by CMS will effectively end online enrollment in FF-SHOPs. Under the intended approach, however, employers would still obtain a determination of eligibility for SHOP participation by going to www.HealthCare.gov, which allows eligible employers to access the Small Business Health Care Tax Credit.
According to CMS, these changes are being made to promote insurance company and agent/broker participation and make it easier for small employers to offer SHOP plans to their employees, while maintaining access to the Small Business Health Care Tax Credit. CMS noted that insurance company and agent/broker participation, as well as overall enrollment in the FF-SHOP Exchanges, has been lower than anticipated and, at its current pace, is unlikely to reach expectations.
Impact for Employers Currently Using the SHOP Exchange
Employers can sign up for SHOP coverage taking effect in 2017 on www.HealthCare.gov until Nov. 15, 2017. In addition, employers that have enrolled in SHOP coverage for the 2017 plan year would be able to continue using www.HealthCare.gov in 2018 for enrollment and premium payment, until their current plan year ends and it’s time to renew.
States operating state-based SHOPs would be able to provide online enrollment, or could opt to direct small employers to insurance companies and SHOP-registered agents and brokers to directly enroll in SHOP plans.
IMPORTANT DATES
January 1, 2018
CMS plans to issue regulations ending online enrollment in FF-SHOPs, effective in 2018.
November 15, 2017
Employers can sign up online for SHOP coverage taking effect in 2017 until Nov. 15, 2017.
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Just a few years ago, taking a trip involved contacting travel agencies, booking hotel rooms and making plans far in advance. Today, however, smartphones and the internet have helped create new sharing services that allow homeowners to connect with travelers and rent out their homes, spare bedrooms or other accommodations for a fee.
Airbnb, the most popular of these sharing services, offers a convenient platform that can provide homeowners with an extra source of income. However, renting through Airbnb can also expose you to substantial risks and leave you with costly property damage and liability claims.
Potential Insurance Gaps
Relying strictly on your regular homeowners or renters insurance policy while hosting guests through Airbnb can lead to significant gaps in coverage. These policies are designed to protect you and your family from everyday risks, and not from commercial renting.
If a renter uses your home for even a small amount of time, you and your family will be exposed to significantly different risks that weren’t considered when your policy was drafted. As a result, most homeowners and renters policies won’t cover property damage that’s caused by Airbnb guests.
If you’re considering renting through Airbnb, your first step should be to contact your insurance broker to review your current homeowners or renters insurance policy. While your homeowners or renters policy may allow you to rent your property to a guest, it’s important to keep in mind that each insurer has its own restrictions and requirements. Some insurers may require advanced notice of any short-term rental, whereas others might insist that you purchase an endorsement to expand your coverage.
If you plan to rent out your residence on a regular basis, many insurance companies will consider this commercial use. In many cases, regular Airbnb hosts will need to obtain a commercial insurance policy in order to be properly insured. However, a growing number of insurance companies now offer home-sharing liability insurance policies that can be purchased on a month-to-month basis.
Issues with Airbnb’s Provided Protection
Airbnb does offer its hosts two forms of protection through its host guarantee program and host protection insurance. While hosts may be inclined to rely exclusively on these programs to manage their risks, there are significant gaps related to these offerings.
Host Guarantee
Airbnb backs every one of its bookings with its host guarantee program at no cost, which will reimburse eligible hosts for damages up to $1 million. However, Airbnb readily admits that its host guarantee is not insurance and should not be considered a replacement or stand-in for homeowners or renters policies.
Moreover, payments through the host guarantee are subject to a lengthy list of terms, conditions and exclusions. Therefore, hosts should be aware of the following issues related to Airbnb’s host guarantee:
- Hosts must attempt to resolve any issues with the guests involved prior to receiving any compensation. This also means that a host would have to make a claim on his or her own insurance policy before the host guarantee would apply.
- Any sum collected from a standard policy or a security deposit would be deducted from the host guarantee.
- The guarantee will only repair or replace covered property that is damaged during the time frame of an online booking.
- This guarantee does not cover certain items including, but not limited to, cash, collectibles, jewelry, pets, watercrafts or any damage to property that is not considered a covered accommodation.
For more information on specific elements of Airbnb’s host guarantee program, hosts can review its terms and conditions in full on the company’s website.
Host Protection Insurance
In addition to its host guarantee program, Airbnb offers coverage to its patrons through its host protection insurance. Airbnb indicates that the program provides primary liability coverage for up to $1 million per occurrence in the event of third-party claims of bodily injury or property damage. Despite these claims, hosts should be wary of relying solely on this insurance program for a number of reasons:
- Intentional acts that aren’t the result of an accident are not covered under this policy. In addition, Airbnb’s home protection insurance does not cover what it refers to as property issues, which can include things like mold, asbestos and bedbugs.
- Neither Airbnb’s home protection insurance nor its fine print is readily available for review. The policy is also subject to limitations, conditions and exclusions. Together, this means that the specifics of these coverages are vague, and Airbnb hosts may not know exactly what’s protected.
- The personal property of any guest is generally not covered. Additionally, any theft or damage caused by a guest may not be covered either.
With Airbnb’s host protection insurance, it’s best to assume that you aren’t equipped with the proper coverage. For full protection, it is likely that you will need to speak with an insurance professional to better understand the policy adjustments you will need in order to be fully covered.
Considerations for Condo Owners and Renters
While Airbnb opens its services to condo owners and renters, multi-unit buildings often have restrictive bylaws, homeowner association rules or lease terms that could impact the ability to host guests through Airbnb.
In many instances, commercial activities like renting out accommodations—even for short periods of time—are forbidden by lease or condo board policies. In some cases, hosts will need to contact their landlord or condo board before subletting or renting out any accommodations. Failure to do this can result in eviction or other forms of legal action.
Even if you’re allowed to rent out your condo or apartment through Airbnb, doing so can cause tension with neighbors. There’s always the potential that your guests may not be respectful to property in common areas, act inappropriately or noisily, or make other tenants feel uncomfortable.
Local Laws and Considerations
In response to the rising popularity of Airbnb, many states, cities and towns are moving to regulate short-term property rentals through their municipal codes or zoning regulations. In some cases, home rental services like Airbnb could be prohibited altogether.
If you break these local regulations, purposely or otherwise, you could face thousands of dollars in fines. What’s more, Airbnb says alignment with laws and regulations is the responsibility of those renting out accommodations. As a result, you need to review your local laws and regulations before using Airbnb to rent out your accommodations.
The Bottom Line
While Airbnb offers a unique and potentially profitable service to users, it’s not without its faults. Before you decide to try it for yourself, be sure to consider all of the risks. For more information on sharing services, or to review your homeowners or renters policy, contact us at 831-661-5697 today.
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