I’m learning to use video editing software.  Lots of fun!

1. Shop Top Companies
The State Insurance Fund is NOT the only competative option.  If your agent tells you otherwise - get a 2nd and 3rd opinion!  There are a number of companies that are HOT in Idaho with Work-Comp.  Each company has Pros and Cons and keep in mind there are variables outside of the rate to consider.  (Such as required deposit amount, dividends, and their ability to help you reduce costs going into the future.)  If your agent can’t or won’t shop mulitple companies – call around until you find someone who will!

2. Get those CREDITS
Ask and ye shall receive!  Find out about all the credits you aren’t receiving now and what you need to do to qualify for them.  Most agents and companies are happy letting you go without credits – because it’s more money in their pockets!  Typically, the bigger credits come from demonstrating you have a formal safety program.  Don’t have one yet?  Ask your agent to help you put one together!  Another big credit can come from having a formal Drug-Free Workplace program.  For years, the expense associated with the required random drug testing was cost prohibitive to small organizations.  However, I’ve discovered a little hidden gem called Idaho WorkCare right here in Idaho Falls that is so aggressive on their pricing, they seem to be able to make it pencil out for about any business.  (The other benefits that come from this can add up too!)  If you’re interested, click here for their information.

3. Experience Modification Factor
This is applied to policies with average annual premiums of about 3,000 dollars or more.  An experience modification factor (e-mod) of 1.0 indicates your business has incurred losses equal to what is expected in a business of your size doing the same type of work.  This would result in no change to your premium.  If your losses are less than is expected over a period of time (3-4 years), the e-mod factor would drop below 1.0.  For example, it might be .89 meaning the premium would be discounted about 11%.  However, if your losses are greater than expected over a 3-4 year period, the factor can be greater than 1 and therefore ADD premium.  So, know what your “e-Mod” is and work to get it to drop.  Caution:  ALWAYS report accidents and have your Work-Comp provider pay!  If you pay, you likely take on the liability for that incident.  What if that cut you paid to get stiched up gets infected and your worker loses a limb?  You’ll probably find yourself spending big defense dollars in court worried about how it’s all going to end.  Besides, every dollar spent is not equal.  Medical payments often do not affect your e-Mod at all.  The way the formula works, it’s payments for loss of work time that are more important to watch. 

Note:  I’m all for outsourcing payroll processing if it pencils out given your unique circumstances, but be very cautious about how they plan to handle your workers compensation.  In general, you are best to maintain your own policy – and not lump your employees into some “master” policy where others’ losses can hurt your rates.  Be sure to get a second opinion before you just go along with their recommendations.

4. Get “Dividends”
Not ALL companies offer this.  The idea behind this is that if a company has a year where losses are low, they will send qualifying insured some of their money back in the form of a check or credit on their account.  There are only a couple of companies in Idaho that offer this.  One company in particular has about 10 years of history in awarding large dividends to large accounts – up to 40% of the premium amount!  I mention this because it is very important not to just look at the rate they are charging you up front – but also consider things like this when determining the true bottom line cost to your business.

5. Break Out Class Codes
Often, companies and agents will set your policy up so that ALL of your payroll is reported under one Class Code (identifying what type of work is done).  This might be the correct way to do it depending on the business you are in and what each of your employees are doing.  But get a second and third opinion on this!  Sometimes, you might be able to get a lower rate on a portion of your payroll by showing the company that it should be under a less risky Class Code.  It’s possible to even split up the payroll from an individual employee among several Class Codes.  For example, a roofing company might have a salaried employee that spends half his/her time on bookkeeping.  You’d want to convince the company to only charge the smaller bookkeeping rate on half of his/her payroll.  Know, understand, and break out your payroll in the appropriate Class Codes!

6. Double Check Payroll Reports
All of the best laid plans can be foiled by the person reporting payroll to the Work-Comp provider.  If you under-report, they’ll get you on an audit!  If you over-report, it doesn’t take long before you just can NOT get that money back EVEN IF you catch it later!  Math errors, reporting payroll on excluded persons (like owners, members, etc.), and reporting extra payroll from time and 1/2 (don’t report the 1/2!) all mean you’ll be paying more than you should.  Don’t just HOPE it’s getting reported accurately.  Set up a system where these figures are DOUBLE checked often by someone outside the person filing the payroll reports with the company.

7, Loss Prevention
You don’t want your “E-Mod” to cost you money!  The goal is to have less losses than is expected from a company your size doing the same work (class codes).  This is PROVEN to happen with good loss prevention.  If you haven’t already, ask your agent what he can do to help you with this.  Often, he has access to loss prevention teams that can help you customize a plan based on proven industry specific methods and practices.  Most, if not ALL of this help should come at no cost to you.  One of my favorite Work-Comp companies has a library chuck full of training material/videos that they encourage their clients to “check-out.”  IMPORTANT:  DO NOT pay for claims out of your pocket.  This can sink your business as I point out in #3.

8. Manage Open Claims
One thing that can seriously effect your E-Mod is reserves on open claims.  Reserves are monies they think they “might” spend on a case in the future – but they’ll count against you today.  You may be able to get them to lower reserve amounts on large open claims.  I suggest asking for a “loss run” from your company at least once a year.  Review it for accuracy and use it to identify problem areas in your company that you might fix to avoid similar losses going into the future.  IMPORTANT:  As I mentioned earlier, Medical bills do not hurt your E-Mod as mush as money spent compensating them for lost wages.  Do all you can to help them get back to work.  Offer light-duty work.  Refer all cases to state rehabilitation workers that are paid by the state to get them working again.

9. Extra Services from Provider
I work with 4 or 5 companies that offer Workers Compensation (including the State Insurance Fund).  Each of them offer extra services to their clients; some more than others.  One company I work with quite a bit offers online payroll reporting and has an incredible loss prevention team.  Call up your agent and have him tell you want “extras” you can get from the company (and also from you agent for that matter!).

10. Get your Deposit Back!
Many companies require a deposit to get started.  If you are with the State Insurance Fund, chances are you’ve forgotten you actually have 25-50% of your annual premium tied up in a deposit.  So if you pay 5,000 a year – you actually paid around 7,500 the first year.  That extra money is just sitting there.  Ask your agent about companies that do NOT require a deposit.  That extra money might as well be in YOUR account as long as you can get at least an equivelent deal somewhere else.  If you don’t want to switch companies right now, have your agent work to lower the deposit that is required.  Perhaps the company can be talked into releasing some of your deposit – freeing up a little more of your money!

11. Understand the game agents play . . .
Most agents play a game called: make lots of promises, sign ‘em up, and move on.  A good agent can save you huge amounts of money over your lifetime IF he or she is really good.  Often, those that are the slickest looking before you switch are the ones that perform the poorest after the switch.  You want to find someone that actually cares enough to give you and your policy attention at least once a year.  This agent should make a great effort to ensure all the things you’ve read about in this blog entry are happening for you.  Every year your agent makes a commission.  Some continue to “earn” the commission they are paid - and some don’t.  If you can’t name very many specific things your agent has done for you THIS YEAR to EARN the commission, maybe it’s time to look at options.  Find an agent that will make keeping on top of all of things EASY and hassle-free for you.

If you’d like more information or have any questions, I’d be happy to help.  Just send me an email or give me a call at 522-5151.

Ben Page

By: Kitty Werthmann

What I am about to tell you is something you’ve probably never heard or will ever read in history books.

I believe that I am an eyewitness to history.  I cannot tell you that Hitler took Austria by tanks and guns; it would distort history.  We elected him by a landslide – 98% of the vote..  I’ve never read that in any American publications.  Everyone thinks that Hitler just rolled in with his tanks and took Austria by force.

In 1938, Austria was in deep Depression.  Nearly one-third of our workforce was unemployed.  We had 25% inflation and 25% bank loan interest rates.

Farmers and business people were declaring bankruptcy daily.  Young people were going from house to house begging for food.  Not that they didn’t want to work; there simply weren’t any jobs.  My mother was a Christian woman and believed in helping people in need.  Every day we cooked a big kettle of soup and baked bread to feed those poor, hungry people – about 30 daily.

The Communist Party and the National Socialist Party were fighting each other.  Blocks and blocks of cities like Vienna , Linz , and Graz were destroyed.  The people became desperate and petitioned the government to let them decide what kind of government they wanted.

We looked to our neighbor on the north, Germany, where Hitler had been in power since 1933.  We had been told that they didn’t have unemployment or crime, and they had a high standard of living.  Nothing was ever said about persecution of any group — Jewish or otherwise.  We were led to believe that everyone was happy.  We wanted the same way of life in Austria . We were promised that a vote for Hitler would mean the end of unemployment and help for the family.  Hitler also said that businesses would be assisted, and farmers would get their farms back.  Ninety-eight percent of the population voted to annex Austria to Germany and have Hitler for our ruler.

We were overjoyed, and for three days we danced in the streets and had candlelight parades.  The new government opened up big field kitchens and everyone was fed.

After the election, German officials were appointed, and like a miracle, we suddenly had law and order.  Three or four weeks later, everyone was employed.  The government made sure that a lot of work was created through the Public Work Service.
Hitler decided we should have equal rights for women.  Before this, it was a custom that married Austrian women did not work outside the home.  An able-bodied husband would be looked down on if he couldn’t support his family.  Many women in the teaching profession were elated that they could retain the jobs they previously had been required to give up for marriage.

Hitler Targets Education – Eliminates Religious Instruction for Children:
Our education was nationalized.  I attended a very good public school.  The population was predominantly Catholic, so we had religion in our schools. The day we elected Hitler (March 13, 1938), I walked into my schoolroom to find the crucifix replaced by Hitler’s picture hanging next to a Nazi flag. Our teacher, a very devout woman, stood up and told the class we wouldn’t pray or have religion anymore.  Instead, we sang “Deutschland, Deutschland, Uber Alles,” and had physical education.

Sunday became National Youth Day with compulsory attendance.  Parents were not pleased about the sudden change in curriculum.  They were told that if they did not send us, they would receive a stiff letter of warning the first time.  The second time they would be fined the equivalent of $300, and the third time they would be subject to jail.  The first two hours consisted of political indoctrination.  The rest of the day we had sports.  As time went along, we loved it.  Oh, we had so much fun and got our sports equipment free.  We would go home and gleefully tell our parents about the wonderful time we had.

My mother was very unhappy.  When the next term started, she took me out of public school and put me in a convent.  I told her she couldn’t do that and she told me that someday when I grew up, I would be grateful.  There was a very good curriculum, but hardly any fun – no sports, and no political indoctrination.  I hated it at first but felt I could tolerate it.  Every once in a while, on holidays, I went home.  I would go back to my old friends and ask what was going on and what they were doing.  Their loose lifestyle was very alarming to me.  They lived without religion.  By that time unwed mothers were glorified for having a baby for Hitler.  It seemed strange to me that our society changed so suddenly.  As time went along, I realized what a great deed my mother did so that I wasn’t exposed to that kind of humanistic philosophy.

Equal Rights Hits Home:
In 1939, the war started and a food bank was established.  All food was rationed and could only be purchased using food stamps.  At the same time, a full-employment law was passed which meant if you didn’t work, you didn’t get a ration card, and if you didn’t have a card, you starved to death. Women who stayed home to raise their families didn’t have any marketable skills and often had to take jobs more suited for men.

Soon after this, the draft was implemented.  It was compulsory for young people, male and female, to give one year to the labor corps.  During the day, the girls worked on the farms, and at night they returned to their barracks for military training just like the boys.  They were trained to be anti-aircraft gunners and participated in the signal corps.  After the labor corps, they were not discharged but were used in the front lines.  When I go back to Austria to visit my family and friends, most of these women are emotional cripples because they just were not equipped to handle the horrors of combat.  Three months before I turned 18, I was severely injured in an air raid attack.  I nearly had a leg amputated, so I was spared having to go into the labor corps and into military service.

Hitler Restructured the Family Through Daycare:

When the mothers had to go out into the work force, the government immediately established child care centers.  You could take your children ages 4 weeks to school age and leave them there around-the-clock, 7 days a week, under the total care of the government.  The state raised a whole generation of children..  There were no motherly women to take care of the children, just people highly trained in child psychology.  By this time, no one talked about equal rights.  We knew we had been had.

Health Care and Small Business Suffer Under Government Controls:
Before Hitler, we had very good medical care. Many American doctors trained at the University of Vienna .  After Hitler, health care was socialized, free for everyone.  Doctors were salaried by the government.  The problem was, since it was free, the people were going to the doctors for everything. When the good doctor arrived at his office at 8 a.m., 40 people were already waiting and, at the same time, the hospitals were full.  If you needed elective surgery, you had to wait a year or two for your turn.  There was no money for research as it was poured into socialized medicine.  Research at the medical schools literally stopped, so the best doctors left Austria and emigrated to other countries.
As for healthcare, our tax rates went up to 80% of our income. Newlyweds immediately received a $1,000 loan from the government to establish a household.  We had big programs for families.  All day care and education were free.  High schools were taken over by the government and college tuition was subsidized.  Everyone was entitled to free handouts, such as food stamps, clothing, and housing.

We had another agency designed to monitor business.  My brother-in-law owned a restaurant that had square tables.  Government officials told him he had to replace them with round tables because people might bump themselves on the corners.  Then they said he had to have additional bathroom facilities. It was just a small dairy business with a snack bar.  He couldn’t meet all the demands.  Soon, he went out of business.  If the government owned the large businesses and not many small ones existed, it could be in control.

We had consumer protection.  We were told how to shop and what to buy.  Free enterprise was essentially abolished.  We had a planning agency specially designed for farmers.  The agents would go to the farms, count the live-stock, then tell the farmers what to produce, and how to produce it.

“Mercy Killing” Redefined:
In 1944, I was a student teacher in a small village in the Alps .  The villagers were surrounded by mountain passes which, in the winter, were closed off with snow, causing people to be isolated.  So people intermarried and offspring were sometimes retarded.  When I arrived, I was told there were 15 mentally retarded adults, but they were all useful and did good manual work.  I knew one, named Vincent, very well.  He was a janitor of the school.  One day I looked out the window and saw Vincent and others getting into a van.  I asked my superior where they were going.  She said to an institution where the State Health Department would teach them a trade, and to read and write.  The families were required to sign papers with a little clause that they could not visit for 6 months.  They were told visits would interfere with the program and might cause homesickness.

As time passed, letters started to dribble back saying these people died a natural, merciful death.  The villagers were not fooled.  We suspected what was happening.  Those people left in excellent physical health and all died within 6 months.  We called this euthanasia.

The Final Steps – Gun Laws:

Next came gun registration.. People were getting injured by guns.  Hitler said that the real way to catch criminals (we still had a few) was by matching serial numbers on guns.  Most citizens were law abiding and dutifully marched to the police station to register their firearms.  Not long after-wards, the police said that it was best for everyone to turn in their guns.  The authorities already knew who had them, so it was futile not to comply voluntarily.

No more freedom of speech. Anyone who said something against the government was taken away.  We knew many people who were arrested, not only Jews, but also priests and ministers who spoke up.

Totalitarianism didn’t come quickly, it took 5 years from 1938 until 1943, to realize full dictatorship in Austria . Had it happened overnight, my countrymen would have fought to the last breath.  Instead, we had creeping gradualism.  Now, our only weapons were broom handles.  The whole idea sounds almost unbelievable that the state, little by little eroded our freedom.

After World War II, Russian troops occupied Austria .  Women were raped, preteen to elderly.  The press never wrote about this either.  When the Soviets left in 1955, they took everything that they could, dismantling whole factories in the process.  They sawed down whole orchards of fruit, and what they couldn’t destroy, they burned..  We called it The Burned Earth. Most of the population barricaded themselves in their houses.  Women hid in their cellars for 6 weeks as the troops mobilized.  Those who couldn’t, paid the price.  There is a monument in Vienna today, dedicated to those women who were massacred by the Russians.

This is an eye witness account.  It’s true…those of us who sailed past the Statue of Liberty came to a country of unbelievable freedom and opportunity.

I think this is HOGWASH (to use language my mother would approve of).  As business owners, we are targets for law suits.  I’ve suffered through a frivolous lawsuit myself – and it was horrible.  After two years of spending enough on defense to purchase a small house, it was finally time to

go to court.  The question came from my attorney (again): “Shouldn’t we do as I suggested two years ago and just offer a fraction of what it will cost you to go to court as a settlement?”  I had learned the hard way that business owners get faced with this same choice everyday here in Idaho and across our country.

• Spend lots of money on defense and trial with an uncertain outcome and very little chance of being awarded defense costs if if the case is won.  OR…
• Settle for a fraction of the defense cost saving time, energy, and lots of money.

You see, business owners can be “shaken down” anytime, for anything, by anybody.  While depressing, the painful but valuable lesson I’ve learned is that my only real choice is to decide WHO is going to pay the next time I get shaken down: me or an insurance company.

When I was shaken down, it was in regards to Employment Practices Liability and this was excluded from my General Liability Policy (which is typical).  Please make sure you have an insurance advisor really making sure you are properly protected.  I’d estimate that about 80% percent of the time I do a comprehensive risk/protection analysis for owners.

I understand that’s a big claim to make.  Just in the last few weeks, I’ve run across the following MAJOR gaps in coverage.

• E&O policy in individuals name but business entity name not listed.  (CRAZY!  and didn’t cost anything to correct.)
• E&O policy for tax prep company but no coverage for sister payroll company owned by same person.
• Total lack of D&O policy for major non-profit organization.
• Total lack of Uninsured&Underinsured coverage in Umbrella policy for local Dentist.
• Financial planner with multiple entities . . . only some of which had general liability policy.  In this case, all entities could be listed on ONE policy – saving money and drastically improving coverage.
• Only Actual Cash Value on high value cabin.  Big Mistake!  Should be Replacement Cost.
• Very low personal auto liability limits for high incom& high networth professional.  Often costs LESS to INCREASE coverage.

 Please take a look at www.FacesOfLawSuitAbuse.Org and check out all the other videos (including this one).  It will blow your mind to hear the outragious lawsuits that small business owners all over the U.S. have had to suffer.  If you would like to run your current situation by me to see if I might have ideas on how to lower costs and increase important coverage . . . I hope you know I’m happy to help – just call or email.  -Ben

P.S.  Click Here for FACTS on Lawsuits!

Stop Being a Big Fat Fatty

Get to Work Every Day By 7:00am. This is going to be super duper difficult for me.  I’d almost rather dig ditches in the afternoon than wake up and watch the sun rise.  Weird I know.  But getting up early means I get more done – - – and I’ll still have plenty of time for fun.  Although I will probably not beable to stay up late enough to watch Conan – bummer right?

Plan My Work - Then Work the Plan.  Oh how I just love winging it.  The problem is that I’m left wondering what I got done at the end of the day.  This year I’ll be disciplined.  And that’s going to get me the true results I want!  So I’ll never leave work until I get my next day planned.  Then, I won’t leave work the next day until I’ve worked the plan.

That’s It! Those that know me will find that my list is extraordinarily short!  Last year I just had too many projects in the fire (entrepreneurial confusion) and that just really slowed me down.  This year, my focus will be very narrow — but I’m going deep!  2010 is going to be rough in a few different ways . . . but it’s going to be awesome in the sense that I’m going to be able to leverage all I’ve learned in the past 35 years of life!!  How great is that!

• Suzy wrote “Happiness is a Choice” on our bathroom mirror – and it’s still there.
• Abby started asking, “Right Dad?” after stating her opinions on things. And I love it.
• Sophie turned into a tease. She loves singing “Time Out For Abby” at the top of her lungs.
• I am wearing cowboy boots and like them. Tried on pearl button snap-type shirts but couldn’t go that far… because I worried real cowboys would beat me up.
• Everyone in the world joined FaceBook and those that didn’t are officially LAME.
• Socialists have taken over the White House. Seriously. But fortunately lots of good people are fighting it.
• After being called to Primary once again – Suzy said with a twinkle in her eye, “Well obviously we got this calling AGAIN because you haven’t learned whatever you’re supposed to learn!” I couldn’t quit laughing . . .
• Abby got quite a cut on her eyebrow bumping into the Piano . . . but loved the purple band-aid so much she wore it for a month. We let her because . . . why not?
• Suzie bought both girls a number of different costumes for Halloween . . . because they were all so cute. Sophie couldn’t decide which one to where . . . and so she wore all of them at once . . . making it hard for her to waddle around.
• Abby doesn’t call Grandpa “Pow-Pow” anymore. I miss that…
• The kids love all the Grandparents, Aunts, Uncles, and Cousins. They talk about them every day.
• I’ve quit Caffeine a couple of times . . . my body is such a finely tuned machine that caffeine just messes it up.
• We had a rough year financially, but we recognize our quality of life – even from a financial standpoint – is better than 98.47% of the world’s population. Certainly we have a lot to be grateful for. Good family, good friends, good health, enough money for all the important stuff, and a good community (and luckily no weird local community organizers to mess it up).
• They discovered Life on Mars (again). Seriously. “Google” it.
• We all got bikes this summer and rode them around together. This brought Suzy to admit she kind of has a thing for men that get out and do stuff with the family. Interesting.

I have a feeling 2009 is one of those years everyone will remember . . . and it will be talked about in the history books. Quite a year! Everyone I know is coming away from it with a few big goals for the near future; get out of debt, emergency preparedness, and most importantly to fight the good fight all along the way.

It’s our wish that every single family member and friend – all of us – can have a great 2010. Merry Christmas! And you can tell the “Holiday” people I said that . . . Suzy and I wish them well too.

The Page Family

About Us: Established in 2001, 70 Years of Combined Life Experience, Licensed and Certified, and currently a true Non-Profit Organization.

4.  Price Only. It’s a common mistake to look at insurance as a commodity – where it’s all the same and price is the only variable to consider.  There are companies that cater to these folks by advertising that they can just name their price.  The idea is that they can give next to nothing in coverage — and give a big discount for it.  If you only look at price, you open yourself up to making a lot of poor decisions because you are blind to all the other factors you should be considering when determining the best VALUE.
Don’t pay a dime for bad coverage.  Instead, get the best deal you can on a protection plan that is appropriate.  There is truth in the old cliché: The cheapest is the most expensive.
Solution:  With the guidance of your advisor, consider some of the following:
•
◦    What are your greatest risks?
◦    What IS covered?
◦    What is NOT covered? (Exclusions)
◦    Are limits of coverage appropriate?
◦    What risks can you live with?  Not all insurance is worth buying.  Don’t let order-takers sell you protection you just don’t really need.
◦    Ongoing services and value added propositions from company.  For example, does your Employment Practices Liability policy come with a free HR hotline?
◦    Ongoing services and value added propositions from agency and agent.
◦    Billing practices.  What’s it REALLY going to cost?!
◦    Am I working with an order-taker or an advisor?
◦    Is this agent/agency free to place me with the appropriate combination of companies/insurance plans?
◦    Does their service seem to be above par?
◦    Consumer rating information of company.  Watch dog companies like AM Best can help you know the truth about companies.  Consider their handling of claims and financial stability.
5.  Thinking like a teen. This doesn’t usually happen in mid-size to large organizations.  They’ve had time to mature and learn some hard realities that some small business owners just haven’t been forced to learn – yet.  But like teens at home, we think we know better . . . and that nothing bad will ever happen.  We roll our eyes at the idea that we should take precautions.  Too many small business owners do not take protecting their businesses seriously . . . and it costs some their entire businesses.
Bad things do happen . . . and ensuring you have a proper protection plan is something you should never entirely delegate.
Solution:  As the owner, along with your advisor, understand the risks you face and take smart action with your team of professionals (company, agency, agent, advisor, risk manager) in creating and maintaining a proper protection package.
Being Fooled by Savvy Marketing.  I’ll admit we use some of these to help folks give us a call for the first time, but we’re open about what they are and why they work.  Let me share a few “secret” tricks of the industry to be aware of:
•
◦    Discounts:  They exist . . . but lots of them don’t necessarily mean the best deal.
◦    Special Associations:  They play on your need to belong and your likely assumption that they MUST be the best if they specifically work with your type of business.
◦    We’re the cheapest!  Companies ALWAYS say they are the best deal . . . verify!
◦    We’re really big and on TV – we must be good.  Hundreds of companies use different advertising/marketing models.  Often, those that advertise most on TV are the most expensive.  Most of the largest – highest rated – companies go through independent agencies because it has proven to be more cost effective.
◦    We have cute Mascots that will make you like us.  Large companies are great at providing products but often struggle to connect with people and serve them at the human level.  Mascots are a way to help you feel connected to them.  Don’t buy into it.  Buy a pet instead and work with real human beings that can give you “real” service.
◦    Heart warming slogans.  They might make you like and remember them . . . but slogans won’t pay your claims, answer the phone, or be there when you need them.  It’s just another way to appeal to your emotions.
◦    We are the biggest independent in town!  How does that benefit you?  This plays on our human tendency to trust things that lots of other people apparently trust.  The reality is that the biggest independent agency often has just been around the longest.  Be wary of them.  I’d suggest a mid-sized agency.  One that is large enough to represent some of the best companies but small enough to give you lots of personal attention.  The agency earning business away from the big dogs can only succeed by better serving you.
◦    Special Programs for your type of business:  I use this one … like many other savvy marketers.  It’s true.  There are special programs.  But they aren’t always the best.  This is related to the “associations” trick.
◦     2,000 years of combined experience.  This is a credibility ploy.  Who cares if it’s 2,000 years of order-taking?  What matters to you is to find 1 key advisor/agent that has enough knowledge/experience to properly advise you – and the desire/ability to properly serve you in an ongoing basis.   It’s something worth looking at – but don’t assume the more years in the business the better.
Solution:  Understand some of the common tactics.  Don’t take an advertisers message as necessarily true and keep your focus on the things that really matter.
6.  No annual reviews. Next to failing to put together a solid protection plan at a truly competitive price, this is the biggest mistake most small business owners make.  Almost every day I hear, “I haven’t heard from my agent in years . . . I don’t really know what my policies cover.”  You wouldn’t just “hope” an employee is showing up to work and performing his duties.
Solution:  Don’t just “hope” everything is ok.  Once a year (at least), take the time to sit down and review your protection plan with your advisor.  All successful mid-sized to large companies do this – and they tend to have a lot more resources to sustain a major loss.  It is especially important for small business owners.
For a great article on how to select the right protection advisor for you and your business, please email me at ben@PageInsuranceLive.com.

My thought was that I didn’t need this type of policy because:

• Idaho is a right to work state. No contracts = no problems.
• I don’t discriminate and am very careful not to mishandle protected classes.
• My employees like me. They would never sue me because I treat them right.

Fast forward a few years: This week I am to settle a lawsuit against a company I have ownership in that has dragged on for over 2 years. The cost has been tremendously high. The money spent on defense alone could have bought a small house. And that does NOT include the horrible amount of energy and lost time I spent worrying and working on the case. Some of the questions that have kept me up at night include:

• Is my attorney really doing what’s best for me, or is he only concerned with racking up billable hours?.
• Will the jury ignore the facts and just side with the plaintiff? It’s shown that juries rarely side with employers but instead tend to feel for employees.
• How can I afford to defend this? If I don’t defend, how could I handle the default judgment of nearly 1/2 a million dollars?
• How can I possible continue to find success in business if so much of my time is spent defending what I have?
• Why did I allow such a serious gap in coverage in my insurance plan?

You must be thinking I fired someone or I had a disgrunteled employee to deal with. Not so. The company was sued by an applicant that we still have never met.

The Lesson: As a business owner, you are a target. People have the perception that you have money …. and they can be quick to sue you for all they can get. And with lots of hungry attorneys – they are often happy to take on cases on contingency. That means the fellow going after you has no cost but lots of blue sky. If you choose not to defend, you can lose to a default judgment. So, if you have anything you don’t want to lose, you MUST defend.

Without a good EPLI policy, YOU will be coughing up the money – YOU will be managing your attorneys – and ultimately YOU will be fighting the fight. But even before any lawsuit, every employee and applicant you have has leverage over you as long as you don’t have this type of policy. They can threaten you with something that can bring you to your knees because of the costs associated … a lawsuit. So, you can find yourself in a bad situation where you are literally shaken down by a disgruntled employee for all you’ve got. Perhapss you don’t fire when you should .. or you are forced to try and placate the employee making threats. My eyes are now opened to the fact that employers are literally shaken down every day by the legal system – they call it cost of defense settlements. You MUST defend .. so even though you are innocent, it’s cheaper to settle early for cost of defense to spare you all the time, energy, and possible embarrassment and bad PR.

The alternative is to have an EPLI policy and the TEAM of solid attorneys that go with it. Most all of it is on the insurance company … and they know how to fight for you! At the first hint of trouble, you just put this on them and you are free to go back to work on your business. Oh how I wish I’d have had this policy!!!

Before you rush out to buy something like this, here are a few tips:

1. Not all policies are the same. READ the policies to understand their limitations — don’t pick the cheapest.
2. Make sure cost of defense is outside limits. You want the insurance company to pay for defense OUTSIDE limits. This way they are more likely to get it over with fast … AND you won’t burn through your limit as quickly.
3. Purchase at least 500,000 in coverage. You won’t save much by going less that this … and quite often companies throw in extras (like cost of defense outside of limit) if you have this much coverage or more.
4. Pick a company that provides an HR hotline free of charge with no limits on how often you can call. The best companies provide this and it can be a great tool to guide you through HR issues.
5. Don’t be fooled into thinking you have coverage on your Commercial General Liability Policy. Typically, there is NO COVERAGE. Other times, there is enough coverage to make you mad when you need it. Companies will sometimes include a very small amount of coverage which is more about “limiting” what they must do for you in this area than it is about covering any claim of significance.

I have more in depth information on EPLI including several valuable publications on the subject that I’d be happy to forward to anyone with an interest in learning more. Please just email me.

Can’t help but show off my kids.  -Ben