How would we insure Santa Claus?

Well, I have officially been in the insurance business too long!  While most people enter the holiday season excited about time off with family, tasty holiday meals and gifts under the tree, I find myself pondering the question, “What if Santa Claus needed to buy insurance?”  Not only that, but what kind of insurance would he need and for that matter would he even qualify?


Right off the bat, Santa’s house and workshop are located in a protection class 10.  In general terms, this means there would be no responding fire department in the event of a fire at his dwelling or workshop.  While Santa would need property insurance protection, he would find himself limited to high risk property markets that may struggle to establish an accurate value for his home and business property.  He also doesn’t need a personal auto policy as his only vehicle – his sleigh – is for business use (this is, however, a commercial auto exposure, which I will address later).

What’s left? Maybe life insurance?  I’m pretty sure Santa would have a tough time finding coverage based simply on his age and, not to be rude,  he would also be a few pounds over the maximum acceptable weight.

Sounds like he’s going to face some barriers when it comes to personal insurance, but maybe we could help him out with his business insurance. We already know the property policy is going to be a tough one to write for the workshop, but what about general liability?  Santa is a toy manufacturer and that’s not an easy class of business to write.  His products are used by children, distributed worldwide, and failure of or injuries from his product could be subject to multiple jurisdictional lawsuits.  I’m afraid that, with the type of product he is producing and his worldwide distribution, this would also be a tough policy for him to procure.

Santa may also have a need for errors and omissions or professional liability insurance.  He claims he knows when you are sleeping and knows when you’re awake.  He also claims to know if you’ve been bad or good…so be good for goodness sake!  What would happen if Santa arrived when you were awake or, even worse, you had been good but yet your gift was delivered in error to another party currently on the naughty list?  Without proper professional liability protection and the Ebenezer Scrooge of attorneys, Santa might find himself in some serious litigation without the proper cost of defense being provided.  Now you may be thinking, “Who would take Santa to court?” but may I remind you that this would not be his first time!  You may remember he appeared in court to face some identity theft claims that arose while he was working for a department store on 34^th street.  The charges were later dismissed, but there were still defense costs associated.

Now let’s explore that business auto policy.  We have some big problems here!  First, Santa uses a custom vehicle mainly for delivery purposes and while it’s only used one day of the year, his delivery radius is huge, he travels many miles, and let’s not forget about those icy conditions.  Santa also has some potential loss and MVR issues.  The claimant’s grandson insists that Santa was involved in a hit and run when his Grandma got run over by a reindeer while returning home on Christmas Eve. Santa also had a theft claim when it was reported the Grinch attempted to steal Christmas. Then there’s the problem of trying to put a value on his vehicle.  All in all, I think a commercial auto policy is out of the question.

Now what he might want to consider is an aviation policy, although he’ll need to go to a specialty market for that.  Maybe we could do something to help with his eight reindeer, although I doubt there are any livestock mortality tables for flying reindeer. Perhaps we could try to offer him some kind of equipment breakdown coverage? No, that won’t work – all manufacturing is done by hand not by machine.

This leads me to another tough policy – workers’ compensation.  Oh my, where do I begin? Santa’s work force uses older manual tools and would be subject to repetitive motion and other injuries.  We also have a potential issue as his entire workforce has a height challenge.  Hopefully he is in compliance for that but I’m not familiar with what OSHA or ADA requirements exist in the North Pole.  Santa may need to consider an Employer’s Protection Liability policy.  Santa has an aging workforce and, let’s face it, with a diet of mostly candy they could have a lot of potential health issues, so I’m pretty sure work comp and group health are going to be tough to get.  I guess Santa could look to a disability policy for himself, but treading across icy roof tops and sliding down into confined spaces I’m sure will make even the most warm-hearted underwriter still issue a decline notice.

Well one thing is clear: being Santa’s insurance agent or company would be a difficult task.  I guess Christmas is not meant to be underwritten but to be enjoyed in the company of our loved ones.   So parents, assure your kids that Santa will be passing through yet another successful year without incident, albeit self-insured, and, in his words, a Merry Christmas to all and to all a good night.

Contact us for all your Insurance needs! (321)725-1620

Bob Lancaster Insurance

Serving Florida since 1964

Yappy Canine Christmas!

You would want to bite somebody too if you had to dress like this... Our Canine Liability program can at least help provide peace of mind - and coverage - for the owners, in case their dogs decide to be naughty! Try a quote today!!

Seek Those Personal Auto Insurance Discounts

There is a good chance that you may be paying too much for your personal automobile insurance. This is particularly true if you are unaware of the numerous auto insurance discounts out there in the marketplace. The following are discounts to ask us about. Some may not be available in all states and from all insurers, but it doesn't hurt to inquire about them. These discounts may significantly affect your insurance premium.

• "Defensive Driving Discount." This discount can save you 10 percent on most of the major coverages under your auto policy, such as liability, medical payments, and collision coverage. Defensive driving courses can cost as little as $20 and last as few as 5 or 6 hours, and the discount normally applies for 3 years.
  
  
• "Good Student Discount." Statistics show that good students tend to be more reliable and mature than students with marginal grades, leading to better driving decisions. Therefore, many states allow a 5 to 10 percent discount if your student driver makes good grades, usually an overall "A" or "B" average in high school or college. If your child has to pay his or her own automobile insurance, this can be another motivator for him or her to make good grades.
  
  
• "Auto Safety Features." Most insurers recognize that owners with cars containing safety features may have fewer accidents and reduced injuries. Many insurers encourage drivers to purchase cars with antilock brakes by giving small discounts for these safety features. Other insurers give discounts for vehicles with daytime running lights.
  
  
• "Accident-Free Discount." Many insurers offer discounts of up to 10 percent for remaining accident free for a period of 3 to 5 years. These are sometimes called "good driver" discounts.
  
  
  Contact us for all your Insurance needs! (321)725-1620
  
  Bob Lancaster Insurance
  Serving Florida since 1964
  
  

Tuesday's Tips - Year End is coming! 5 Financial and Tax Planning Things to Do Right Now

The clock is ticking and the year is winding down. Don’t let December 31 take you by surprise. Act now to solidify your position for the year.

1. Meet with your CPA

Work your tax advisor to map out some year-end tax planning strategies so you’ll minimize your tax bill for 2014. This may require you to spend more money to reap tax savings, so make sure you have the cash flow to support the strategies. The sooner you schedule an appointment, the more time you’ll have to take action.

2. Review your balance sheet

If you may need commercial financing next year, your year-end balance sheet may be a key factor in securing a loan. Review what’s on the balance sheet so you can make favorable changes. It could mean, for example, paying an outstanding loan.

3. Finalize year-end bonuses

Decide who will get bonuses and how much. If your calendar-year business is on the accrual basis for accounting purposes, then bonuses paid to rank-and-file employees within the first 2-1/2 months of 2015 are deductible on your 2014 return. The bonuses must be reflected in the minutes of your company’s annual meeting. Bonuses to a S corporation owner are not deductible until actually paid.

4. Face your inventory challenges

Have you been sitting on inventory that just hasn’t moved despite your best marketing efforts? In order to make adjustments to closing inventory by writing off obsolete items, you must offer them for sale at least 30 days prior to the end of the year (the date you take the write-off).

5. Fix benefit plans for the coming year

Are you offering health care coverage? A retirement plan? Now’s the time to act. If you plan to offer employees health care coverage in 2015, you must give them 30-days notice of the coverage so they can decide what to do (e.g., opt out if a spouse’s coverage is better). Also, if you don’t yet have a qualified retirement plan, you must sign the paperwork by December 31 if you want to make 2015 contributions. So talk to an insurance broker for health coverage information and to a financial advisor for retirement plans so you can get started immediately.

Conclusion

Don’t wait until you’re thick in the midst of the holiday season to attend to your tax and financial matters. Do this now!

Contact us for all your Insurance needs! (321)725-1620

Bob Lancaster Insurance

Serving Florida since 1964

Environmental Exposure Focus: Shopping Centers

In the past, stores were often stand-alone structures, which meant that whatever environmental issues they experienced were typically contained within their own property boundaries. Today, stores are usually part of large shopping malls or strip malls. They no longer stand alone and the environmental impact of one retail establishment will often affect other establishments in their vicinity. Tenants at shopping centers that could pose a significant risk for environmental impact may include: dry cleaners (solvents), restaurants (grease, cleaning solvents, mold), nail salons (solvents), auto parts stores (oils, solvents, batteries), as well as many others. Environmental exposures could stem from the following areas:   Product/waste transportation Spills of products or waste during transportation. These products or wastes may be hazardous or non-hazardous and still require cleanup in the event of a spill or cause natural resource damages (ex. In the past, milk spills have caused natural resource damages, etc.). Waste management Businesses that typically generate hazardous wastes include: dry cleaning operations, pharmacies, photography kiosks, printing establishments, paint kiosks, plant nurseries, and pet groomers.   Product selection Paints, solvents, fertilizers, pesticides, and other products may spill outdoors during loading or unloading activities. Often, these chemicals can persist in the environment for long periods of time and contaminate soil, surfaces, or groundwater.   Product handling and storage A national retail chain settled a pollution claim for over $30,000. The claim was made against them by state regulators for accidentally discharging ammonia into a creek. Employees were replacing safety valves on an ammonia refrigeration system when ammonia and drinking water leaked into their parking lot and into the creek.   Facility management Indoor air quality issues can stem from improper management of asbestos, lead paint, and water intrusion which may lead to mold, microbial matter, or other indoor air quality issues. New shopping malls often have building components that off-gas such as drywall, carpet glue fumes, paint emissions, wood adhesives, or preservatives.   The environmental insurance policy that is most applicable to addressing shopping center concerns is a Premises Pollution policy. This product is designed to provide coverage for unknown, historical, and future environmental liabilities such as claims for bodily injury, property damage, and cleanup costs as a result of a pollution event. Contact us for all your Insurance needs! (321)725-1620 Bob Lancaster Insurance Serving Florida since 1964

'Tis the season for cyber attacks: 6 ways to protect against breaches

Online holiday sales in 2014 are estimated to rise between 8% and 11%, reaching as much as $105 billion, according to the National Retail Federation. Because shoppers are expected to do much of their holiday shopping online, this presents a heightened concern over cyber security.
Businesses should prepare against cyber attacks all year long, but they should be especially diligent during the holiday season when employees are at their busiest.

• Train employees to protect sensitive information. All employees—even seasonal ones—should learn the importance of protecting the information they regularly handle to help reduce exposure to the business. This includes everything from locking up customer records to keeping passwords strong and confidential. Employees should also be taught how to handle a breach if one occurs.
• Halt systems changes until the end of the year. Make sure your software and other technologies are running smoothly and avoid implementing new systems at this time. Of course, there may be exceptions to address critical new patches.
• Ensure systems have appropriate firewall and antivirus technology and that security software patches are updated in a timely fashion. After the appropriate software is in place, evaluate the security settings on software, browser and email programs. In doing so, select system options that will meet your business needs without increasing risk. Regularly maintaining security protections on your operating system is vital to them being effective over time.
• Monitor use of mobile devices and public Wi-Fi access for employees. Establish usage standards and be sure they are clearly communicated. For example, to avoid security breaches, employees should be instructed to use public Wi-Fi only in very limited circumstances. Hackers can easily intercept public Wi-Fi, so it is imperative that employees cautiously use the Internet and transmit information. To reiterate, any data that shouldn’t be made public, such as proprietary business or customer information or credit card numbers should not be transmitted or accessed through public Wi-Fi.
• Insure that your season is protected. Insurance coverage typically includes liability protection for when customers or other individuals who have been affected hold a company responsible for information stolen during data breaches or other network intrusions. A cyber policy can also include coverage for a forensic investigation, litigation and remediation expenses associated with the breach. In addition, a cyber program may include coverage for business interruption, which is critical during the holiday season.
• Have a plan in place to manage a data breach. If a breach occurs, there should be a clear protocol for which employee is managing the situation, and what action should be taken, such as informing the insurance provider, etc.

Work Comp Wednesday - New Osha Reporting Requirements Go Into Effect January 1st

The Occupational Safety & Health Administration (OSHA) is charged with ensuring that all employers provide a safe workplace for their employees. Under federal law, all employers, regardless of size or industry type, must report to OSHA all fatal work-related accidents and work-related hospitalizations of 3 or more employees. 

Starting January 1, 2015, all employers will be required to report work-related fatalities within 8 hours and all in-patient hospitalizations, amputations, and losses of an eye within 24 hours of finding out about the incident. 

Employers have 3 options for reporting these incidents to OSHA:

• Call the regional OSHA office in Atlanta at 678-237-0400
• Call the 24-hour OSHA hotline at 800-321-OSHA (6742)
• Report online at osha.gov/report_online

Under Florida law, employers must also report all workplace fatalities to the Florida Division of Workers’ Compensation by calling 800-219-8953. Alternatively, employers can fax a First Report of Injury form containing the fatality information to 850-413-1980.

In addition to these reporting requirements, employers who have workers’ compensation insurance are also required to report all workplace injuries to their workers’ compensation insurance company. By law, employees are required to report work-related injuries to their employer no later than 30 days after they happen. Employers must then report work-related injuries to their insurance company within 7 days after learning of the injury. Late reporting of claims to your insurance carrier can result in the state assessing penalties and holding the employer responsible for paying part of the injured employee’s benefits. 

Employers should report all claims from employees to the employer’s insurance company, including claims in which there are no witnesses of the injury or illness. It is the insurance company’s responsibility to then investigate all claims and determine if employees are entitled to workers’ compensation benefits. 

Contact us for all your Insurance needs! (321)725-1620

Bob Lancaster Insurance

Serving Florida since 1964

The 2014 insurance fraud hall of shame

America's most notorious insurance schemers have earned leadership of their moral wasteland by induction into the Insurance Fraud Hall of Shame.

The No-Class of 2014 was chosen by the Coalition Against Insurance Fraud. The Shamers come with a warning sign: “Do Not Touch: High Revoltage.”

They represent the most brazen, vicious or klutziest insurance cons of the last year. Small wonder, they inflicted costly fakes and pains on consumers and insurers throughout the nation.

America's pharaohs of fraud possess an uncanny drive to connive in pursuit of the immaculate deception. But the newly inducted meaculprits received a loud break-up call: They were convicted last year thanks to the tireless efforts of fraud fighters.

The Hall of Shame draws public attention to an $80-billion annual fraud spree that many consumers and policymakers think is a harmless and victimless crime. Most Americans are honest, but unacceptably large percentages tolerate fraud — a kind of outrage deficit disorder, research shows. The Hall of Shame presents true-life stories to convince more consumers that insurance fraud is deviant and intolerable behavior.

Storytelling is humankind's oldest and most-effective form of communication. Our brains are biologically wired to think in narratives. Stories also are 20 times more likely to be remembered than hard facts.

Humans thus have fashioned stories to interpret and remember events since the first cave people sat around the campfire to talk about the day's woolly mammoth hunt.

Herewith is the hunt for the Coalition's newest moral invertebrates, the No-Class of 2014.

Dr. Spyros Panos | Poughkeepsie, N.Y. Malpractice Fraud

The orthopedist made more than $35 million in false claims for thousands of botched and faked surgeries. He rushed up to 20 surgeries in a day — as many as other orthos normally perform in a month. One surgery lasted seven minutes.

Panos bounced from operating room to operating room in quick sequence. He performed substandard surgeries, or just sliced open patients and stitched them up without making repairs. Panos also billed routine arthroscopic procedures as expensive open surgeries.

Christine Steele had two useless knee surgeries and has been unable to work full-time ever since.
Chris Hanson never recovered after three surgeries, including two knee repairs. He can't work at age 55 and has trouble walking. Panos also operated on both Achilles tendons of a senior. She is in constant pain and can't even play with her grandchildren.

Panos received 4½ years in federal prison and faces about 260 malpractice suits.

Angela Garcia | Cleveland, Ohio Insurance Fraud

Garcia let her infant daughters, Nyeemah and Nija, die in a house fire she set for just $64,000 worth of insurance money. Garcia had overvalued the contents of her home on a renter's insurance claim.

She made claims for possessions she didn't have. Garcia also removed valuables before the fire. The girls had died of smoke inhalation by the time firefighters pulled them from their upstairs bedroom.
Garcia tied Nyeemah with the cord from a window blind to keep her from escaping the fire, prosecutors charged. She showed no grief or other emotions, freely socialized afterwards, and filed her claim within weeks of the girls’ deaths.

The fire may have started from an unattended candle in the dining room, Garcia claimed. Yet arson investigators found two burn patterns started by a flammable liquid.

Garcia also said she crashed through a second-floor window and slid down the porch roof to the ground. Yet she had little or no soot on her, and required no treatment for smoke inhalation. Nor did she have cuts from shattering the windowpanes.

Garcia no longer wanted her children and had tried to give away custody, prosecutors also charged. She was convicted of insurance fraud and killing the kids. Garcia received life in prison.

Andy Lee House | Galveston, Texas Insurance Fraud

House drove his rare Bugatti Veyron into a swampy lagoon to collect $2.2 million. He told his insurer that a low-flying pelican forced him to swerve off the road into the muck.

But a car enthusiast just happened to be driving by and was awed by the sleek Bugatti. He videotaped House roaring into the lagoon. The video shows no pelican in sight. Nor were there skid marks or other evidence that House tried to brake


He also left the engine running for 15 minutes in the lagoon. The salt water filled up the engine and ruined the vehicle. House lied that he was too busy fighting mosquitoes to turn off the engine.

The Veyron is one of the world's fastest street-legal production cars. It has an everyday top speed of 213 miles per hour — and was built to reach 253 mph. Only 300 were made. House pleaded guilty and faces up to 20 years in federal prison when sentenced.

Joseph Haddad | Bridgeport, Conn. Medical Insurance Fraud

Retribution crashed into personal-injury attorney Joseph Haddad for running a crime ring that stole millions of insurance dollars by giving useless and inflated treatment to crash victims his paid recruiters delivered.

He erected a large and complex network of doctors, chiropractors, diagnostic clinics and recruiters. Providers diagnosed victims, often without exams, then billed insurers for months of phantom or useless treatment. Runners typically appeared at police stations each day to buy police crash reports that identified the victims. The runners then badgered victims to sign up at Haddad's office.

But Haddad fell hard once federal agents infiltrated his ring by acting as crash victims. One agent was billed for 11 chiro exams even though he only received four treatments. One of Haddad's doctors, meanwhile, was operating with a suspended license.

Haddad was whacked with 51 months in federal prison and must repay $1.8 million.

Christopher Inserra | New York, N.Y. Workers’ Compensation Fraud

The former New York cop moonlighted and gyrated as the lead singer for a punk rock band while collecting more than $31,000 in workers’ compensation money for a supposedly injured arm.
Inserra said he hurt his right arm while taking an injured Port Authority employee to a medical facility. He lied that he had a “tremendous amount of pain” around his right elbow and lower bicep. More medical exams found no serious injuries, but Inserra kept complaining he couldn't even bend his arm.

Yet he kept performing. Photos show him “repeatedly moving his arms in a punching motion” and “violently flailing his arm in an up-and-down motion” on the stage. The band hit the road for a tour called “Miles of Mayhem.” Video from concerts in Athens, Ga., Cocoa Beach, Fla., and elsewhere shows him fist pumping and thrashing around. Inserra lucked out with three years of probation. His band's name: Cousin Sleaze.

Sara Ylen Port | Huron, Mich. Healthcare Fraud

Cancer enshrouded Ylen, who lay near death after developing cervical cancer stemming from her being raped in a store parking lot. How tragic. Except that Ylen invented the convincing drama.

Her insurer paid more than $120,000 in useless hospice care. The community also rallied around Ylen. A church raised $10,000 to pay other bills, and other well-wishers raised thousands more. A local newspaper wrote an award-winning series about her seemingly valiant fight against her stage-four condition.

Ylen's testimony sent innocent James Grissom to jail for nearly 10 years as her falsely charged rapist. But tests soon showed Ylen didn't have cancer and her life wasn't in danger. The hospice kicked her out. A probe of her computer found search terms, images and URLs proving she’d researched cancer. Ylen also said certain doctors had diagnosed her, but the docs denied involvement.

Ylen pleaded no contest and received a year in jail.

Dr. Farid Fata | Detroit, Mich. Medicare Fraud

Seniors received painful and debilitating chemo therapy for cancer they never had. Cancer specialist Fata made $225 million in false Medicare claims. About half went for needless chemo and other cancer treatments. He deliberately misdiagnosed patients who were in remission or had no chance of surviving.

Medicare paid out more than $91 million, and Fata billed private insurers as well.

Fata gave one patient 155 chemo treatments over 2½ years — though the patient was cancer-free.

Other patients were pumped with useless blood therapy and iron treatments. And one patient fell down and badly injured his head at the office. Yet Fata insisted that the patient receive his chemo before going to the ER.

Fata also faked anemia and fatigue diagnoses to justify giving patients dangerous levels of billable drugs. He faces up to 175 years in federal prison when sentenced.

Suzanne Basso | Houston, Texas Life Insurance Fraud

Buddy Musso was a grocery bagger and had the IQ of an eight-year old. He stayed at an assisted-living home near upper Manhattan.

Buddy dreamed of being a cowboy singer. He enjoyed singing slightly off-key versions of country-western songs he heard on the radio.

Suzanne Basso befriended Musso. She lured him to Houston with a false promise of marriage. He was in love with her and wanted to marry. She was in love with the insurance money.

Basso and her cohorts secretly took out $150,000 worth of life policies on him, upped the policy with a $60,000 violent-death clause, then tortured and killed him. Buddy's body was found in a ditch — lacerated, beaten and doused with bleach.

Basso tried various dodges to avoid trial: She used a wheelchair and claimed paralysis. She also pretended to be blind, or had regressed to childhood and had the voice of a little girl. The court-appointed psychiatrist said she was faking. Basso was executed by lethal injection in February 2014.

Pamela Phillips | Aspen, Colo. Life Insurance Fraud

The former Aspen socialite will socialize with prison inmates after car-bombing her ex-husband for $2 million in life-insurance money to fund a jet-setting lifestyle.

Phillips and Gary Triano lived large in the posh foothills of Tucson, Ariz. Gary was a wheeler-dealer, creating businesses, running Indian bingo casinos and playing a lot of golf. They were rich and rubbed shoulders with well-known figures such as the Trumps.

But Triano's business ventures collapsed and he went broke. Phillips had no more need for Triano. His car exploded as he left his country club after golfing. Phillips had paid ex-boyfriend Ronald Young $400,000 to carry out the hit.

Phillips moved to Aspen, where she became a well-known socialite. Financial records and phone conversations that Young secretly recorded during talks with Phillips exposed the deadly ruse. She once said how easy it would be to hire someone to kill Triano, a longtime friend also testified. Phillips received life without parole.

Contact us for all your Insurance needs! (321)725-1620

Bob Lancaster Insurance

Serving Florida since 1964