INSURANCE COVERAGES TO PROTECT YOUR FIRM
Law offices need protection from risk of loss for physical location and contents, and premises liability, as well as coverage for the business interruption and persons working there. Insurance coverage is available through Web sources, but working with a good insurance agent will allow a thorough assessment of coverage needs and policy options. Discounts also may be available for multiple coverages.
The ISBA has partnered with Reynolds and Reynolds to assist you with most of your insurance needs. For information about their insurance offerings please contact David A. Fini or Kristi Rullestad at (800) 767-1724 or (515) 243-1724 with any questions.
The ISBA Insurance Program administered by Lockton Affinity is available to assist you withProfessional liability insurance. For more information, visit http://iowabarinsurance.com/.
Insurance Coverages to consider:
A. Professional Liability - this type of insurance is also known as Errors and Omissions Insurance. The policy provides defense and damages for failure to or improperly rendering professional services. Your general liability policy does not provide this protection, so it is important to understand the difference. Professional liability insurance is applicable for any professional firm including lawyers, accountants, consultants, notaries, real estate agents, insurance agents, hair salons and technology providers to name a few.
B. Cyber Liability - insurance designed to cover consumers of technology services or products. More specifically, the policies are intended to cover a variety of both liability and property losses that may result when a business engages in various electronic activities, such as selling on the Internet or collecting data within its internal electronic network.
Most notably, but not exclusively, cyber and privacy policies cover a business' liability for a data breach in which the firm's customers' personal information, such as Social Security or credit card numbers, is exposed or stolen by a hacker or other criminal who has gained access to the firm's electronic network. The policies cover a variety of expenses associated with data breaches, including: notification costs, credit monitoring, costs to defend claims by state regulators, fines and penalties, and loss resulting from identity theft.
C. Business Owners Policy - A business owner policy packages all required coverage a business owner would need. Often, BOP’s will include business interruption insurance, property insurance, vehicle coverage, liability insurance, and crime insurance. Based on your company’s specific needs, you can alter what is included in a BOP. Typically, a business owner will save money by choosing a BOP because the bundle of services often costs less than the total cost of all the individual coverage’s.
D. Auto Policy - Commercial auto insurance protects a company’s vehicles. You can protect vehicles that carry employees, products or equipment. With commercial auto insurance you can insure your work cars, SUVs, vans and trucks from damage and collisions. If you do not have company vehicles, but employees drive their own cars on company business you should have non-owned auto liability to protect the company in case the employee does not have insurance or has inadequate coverage. Many times the non-owned can be added to the BOP policy.
E. Flood and Other Disaster Protection – Flood insurance is the best way to protect yourself from devastating financial loss arising out of such perils as flood, earthquake and some other natural disasters. Events of the past several years have highlighted how most property insurance policies, such as the business owners policy, do not protect the property owner for these kinds of losses.
F. Workers Compensation - Worker’s compensation provides insurance to employees who are injured on the job. This type of insurance provides wage replacement and medical benefits to those who are injured while working. In exchange for these benefits, the employee gives up his rights to sue his employer for the incident. As a business owner, it is very important to have worker’s compensation insurance because it protects yourself and your company from legal complications. State laws will vary, but all require you to have workers compensation if you have W2 employees. Penalties for non-compliance can be very stiff.
G. Umbrella Policies - You may want some additional coverage, on top of insurance policies you already have. This is where umbrella insurance comes into play. This type of insurance is an extension to an already existing insurance policy and covers beyond the regular policy. This insurance can cover different kinds of claims, including homeowner’s or auto insurance. Generally, it is sold in increments of $1 million and is used only when liability on other policies has been exhausted.
H. Life Insurance - Life insurance protects an individual against death. If you have life insurance, the insurer pays a certain amount of money to a beneficiary upon your death. You pay a premium in exchange for the payment of benefits to the beneficiary. This type of insurance is very important because it allows for peace of mind. Having life insurance allows you to know that your loved ones will not be burdened financially upon your death.
I. Disability Insurance – Disability Insurance is a form of insurance that insures the beneficiary's earned income against the risk that a disability creates a barrier for a worker to complete the core functions of their work. It encompasses paid sick leave, short-term disability benefits (STD), and long-term disability benefits (LTD).
J. Health Insurance – Health insurance is insurance against the risk of incurring medical expenses among individuals.
K. Fiduciary Bond – An insurance bond that assures the faithful performance of a fiduciary. Since a fiduciary is a position of trust, a bond is executed to protect the person for whom the fiduciary acts against fraud and embezzlement. A fiduciary may be an administrator of an estate, guardian of a minor or a trustee of a trust.