Is a “BOP” right for your business?

Considering all the things that can go wrong with a business, small business owners are often considered risk takers. However, there are two risk exposures that business owners cannot afford to overlook: property loss due to perils such as fire, theft, wind, or water damage, and liability loss for injuries sustained by individuals while on business premises and/or during operation of the business. Although self-insuring was once an option, in today’s litigious society, it is hardly cost-effective, particularly for potentially catastrophic losses. This is where a business owners policy (BOP) can play a crucial role in risk management.

A BOP bundles prearranged property and liability coverage in one package. Thus, a BOP provides property coverage for a building and its contents, coverage for loss of business income after an accident, and liability coverage for physical injury or physical damage caused by an employee, on-premise risk, operation, or product. (Health insurance, workers compensation, and business automobile coverage are typically not included in the standard BOP.)

The primary advantages of a BOP are ease of handling, streamlined rating procedures, and a reduced need for detailed risk management decisions. Typically, a BOP is less expensive than purchasing several policies separately.

Is a BOP Right for My Business?

Generally, specific criteria must be met in order to qualify for this type of policy. First, your business should be considered a “good” risk so that premiums can be priced more affordably than individual policies. For instance, a small neighborhood bookstore selling books on gardening may have an easier time obtaining a BOP than a company that is in the building demolition business (where serious accidents may be more likely to occur). Second, your business should have “ordinary” insurance needs without the potential for unusual exposure to loss. Again, a demolition company has more unusual exposure to loss. A standard BOP that does not adequately meet the needs of a particular business may be customized to meet those specific needs, which often makes a BOP an appropriate choice for small businesses.

While every business is unique, many businesses are exposed to similar types of risk. If the risk exposures of your business are fairly common, you may want to explore the benefits of a BOP. Having most risks covered under one policy can prove to be a cost-effective risk management tool. For more information on BOPs, give us a call. One of our qualified insurance professionals will be happy to help you determine if a BOP is right for your business.

How ergonomics can boost productivity

As a business owner, did you know you may be able to cut costs and boost productivity by establishing an ergonomics program? Ergonomics is the science of modifying job tasks, equipment, tools, and the work environment to an individual worker’s needs.

One of the most common types of work-related injuries is musculoskeletal disorders. While such injuries can occur outside the workplace, repetitive stress or sustained physical exertion in the workplace can result in a variety of musculoskeletal disorders, such as chronic neck or back pain, carpal tunnel syndrome, tendonitis, and osteoarthritis. So, why wait until you have an injured worker and a workers compensation claim on your hands? The sooner you implement an ergonomics program in your workplace, the better.

Outlining Ergonomic Objectives

To start tackling ergonomic concerns, appoint a committee comprised of management and other relevant departments such as human resources, engineering, and health and safety. Be sure to also include employees from work areas that may involve repetitive or hazardous tasks. Ask the committee to draft a policy outlining ergonomic objectives. They may also be responsible for tracking the progress of ergonomic projects and monitoring the outcomes.

Begin by identifying potential hazards. Records of injuries, accidents, absenteeism, and workers compensation claims can reveal problem areas. Solicit input from employees—a lot can be learned from workers’ complaints. Another approach is simply to observe employees at work. Many workplace conditions that lead to musculoskeletal disorders are easily recognizable. For instance, do work stations provide appropriate height, depth, and clearance? Pay particular attention to jobs that involve repetitive motions, or require excessive force or unnatural movements.

Safety Procedures

Teach employees to recognize the early symptoms of musculoskeletal disorders. Educate them about ergonomic principles and encourage them to follow safety procedures. Review work station arrangements and, if necessary, modify them with safer, more comfortable equipment to reduce unnecessary physical strain. Encourage workers who perform repetitive tasks to rotate duties or take periodic breaks, as needed.

If you recognize potentially hazardous conditions, or receive complaints from several employees, address the problem as soon as possible. Injuries can occur, and symptoms of strain or discomfort may progress to more serious or chronic conditions.

Implementing an ergonomics program before problems occur is important. When workers are safe and comfortable, you will see a boost in productivity. Besides, what better way to show appreciation for your employees than by addressing obstacles to their health, safety and well-being? Over time, it will save you time, money, and aggravation, and create a more productive work environment.

Every industry has its unique occupational hazards. For instance, food service jobs may expose workers to slippery floors, hot cooking equipment, and sharp objects. Janitorial work may require contact with hazardous chemicals in industrial cleaning supplies. Even retail workers may risk injury due to heavy lifting.

If you employ teenage workers, it’s important to be aware that they are often at higher risk than adults of being injured on the job. This is partly because the places where teens work—restaurants, grocery and convenience stores, gas stations, and retail stores—can sometimes be hazardous. And, teen workers may be asked to perform tasks for which they haven’t yet been completely trained. In addition, teens may not yet know how to assess risk, or handle it effectively.

To protect your business and your staff, be sure to brush up on the laws protecting the safety of working teens. For starters, employers are required to provide all workers, including teens, with the following:

• A safe and healthy work place.
• Safety and health training, especially regarding chemicals.
• Paid medical care and sick leave for certain on-the-job injuries.

Teen Labor Laws

Generally, Federal and state labor laws regulate the number of hours, schedules, and types of work teens are allowed to perform. Limitations for adolescents age 14 and 15 may be more stringent than for those aged 16 and older. For instance, teens under age 16 may be restricted on the number of hours they can work each day and week, depending on whether it is a school day and whether school is in session. However, the laws do make exceptions for students in work experience programs.

Age limits usually apply to dangerous work. For example, workers generally must be age 18 or older to drive a motor vehicle, operate most power equipment, and work in certain occupations such as wrecking, excavation, and roofing. Typically, no one aged 14 or 15 may work in construction, in warehouses, on ladders or scaffolds, or as a cocktail server, baker, or cook. Also, those under 16 may not unload trucks, conveyor belts, or railroad cars. There may also be restrictions for other types of work.

Promote Health and Safety

To encourage a safe work environment, employers must educate teens about basic safety and emergency procedures. Encourage them to follow all safety rules and instructions and to wear protective gear, as needed. Point out that a clean and tidy work area is more likely to be a safe work area. Post safety and training materials in more than one language, if necessary, and inform teens to promptly report safety and health hazards to their supervisor.

Many injuries among teen workers can be prevented with industry-specific health and safety training, and adherence to safety laws. For more information on the regulations, potential concerns, and liabilities of employing teens in your business and state, visit the Department of Labor (DOL) website devoted to working teens at www.youthrules.dol.gov.

First jobs are seldom forgotten. Early work experiences can be rewarding and provide opportunities for learning and growth. As a business owner, you can promote positive and safe work experiences that help prepare young workers for the 21st century.

Life insurance is an important component of many business arrangements. While most business owners are familiar with life insurance as an employee benefit, many may not be aware of the variety of other potential business uses. Here are some of the more common ways you can use life insurance to help benefit and solidify your business:

Funding Buy-Sell Agreements. Under a typical buy-sell agreement, business partners agree to purchase each other’s interest if one of them dies. Life insurance can be a cost-effective method of funding this type of agreement, as long as you and your partners are insurable. If you purchase a permanent insurance policy, which includes a cash value component, you can use the accumulated cash value to buy out your partner’s share in case of retirement or disability.

Providing an Employee Benefit. Life insurance is a basic component of many employee benefit packages. One example is a traditional employee group term plan, which generally covers most employees. You can also use life insurance to enhance the benefits of select (key) employees who are vital to the success of your business. In many instances, this death benefit coverage can be provided at little cost to the select employee.

Insuring Key Employees. The death of a key employee can create a number of financial challenges for a business. Revenue may be affected; customers may need assurance that business operations will continue; and a replacement must be recruited and trained. Key person life insurance can provide funds to help your business meet these needs without jeopardizing operations or interfering with cash flow.

Insurance in Qualified Retirement Plans. Life insurance may be acquired within a company’s qualified retirement plan. Legal limits apply in general, and some may be specific to a defined contribution plan or a defined benefit plan.

Guaranteeing Business Loans. Owners of new or growing businesses may have difficulty obtaining business loans. Lenders need to be assured that loans will be repaid, even if the owner dies unexpectedly. Business credit life insurance may make it easier to obtain financing by guaranteeing repayment with the proceeds from a life insurance policy.

Review Your Needs

Life insurance can be an appropriate vehicle for important business purposes, such as business succession, employee benefits, and financing, but it is important to be aware of any tax consequences. When considering the use of life insurance for your business, careful planning with the help of your professional advisors is essential.