The CARES Act: Relief for Small Businesses

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The COVID-19 pandemic has been catastrophic for many restaurants, hotels and other hospitality businesses. Small businesses are especially vulnerable to sudden loss of revenue and forced closures. Although the situation seems bleak, legislation is being enacted to help both businesses and workers hurt by coronavirus. The new $2 trillion Phase III coronavirus relief package could provide even more relief.

Phase III of COVID-19 Legislation and Economic Relief

According to Investopedia, H.R. 758, or the CARES Act, is Phase III of COVID-19 legislation. It is also the largest stimulus bill ever in the United States. The $2 trillion bill includes expanded unemployment benefits, direct payments to individuals, relief for small businesses and more. The bill was passed by the Senate on March 25 and passed by the House of Representatives on March 27. It is expected to be signed by President Trump shortly.

In a March 26 interview with Sean Hannity on Fox News, Treasury Secretary Steve Mnuchin discussed the relief package. Mnuchin said he hoped to get the small business program up and running the following week, allowing small businesses to get a loan immediately, and the loan could be forgiven if the businesses keep their employees. This will help small businesses continue to employ their workers while struggling with circumstances beyond their control.

CNBC reports that eligible businesses may be able to borrow up to the lesser amount of $10 million or 2.5 times their payroll. Businesses may also be eligible for a $10,000 emergency grant. Businesses with fewer than 500 employees may be eligible, and the loans are provided through private financial institutions. Loan forgiveness is also available.

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M. Brant Watson
Senior Vice President
Heffernan Insurance Brokers
D: (925) 295-2506
M: (925) 330-1151

Managing the Remote Work Transition: Tips for Employers

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As more cases of COVID-19 are detected in the United States, people are being asked to do what they can to stop the spread. Schools have been closed, events have been cancelled and many people are working from home.

In this situation, work-from-home policies are being implemented as an emergency measure, but the arrangement had already been gaining popularity for a while now. With modern technology, it’s easier than ever to telecommute, and it can give workers the flexibility they need to achieve better work-life balance. No one misses rush hour commutes, either.

Nevertheless, the transition can be tricky, especially when it comes unexpectedly. Here are some tips for employers managing the remote work transition.

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Why Business Should Prepare Now for Insurance Market Hardening

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You might not realize it, but times have been pretty good for insurance customers. Although there have been some exceptions, for the most part, premiums have been steady or even reducing for years now. This may be about to change.

Why are market conditions changing? Because insurers are experiencing higher than expected losses. According to the 2019 A.M. Best Market Segment Report, the reported combined ratio for the P&C insurance industry has been above 100 – indicating an underwriting loss – since 2016. In 2017, the combined ratio reached 104.

If these losses continue, rate increases will follow. Securing coverage may become more challenging. Essentially, we may be looking at a hard market.

What’s driving higher-than-expected losses?
With property insurance, natural disasters are mostly to blame. The A.M. Best report says that Hurricanes Harvey, Irma and Maria contributed to near-record high U.S. catastrophe losses in 2017, with net catastrophe losses of $53 billion. Then in late 2018, the U.S. was hit with Hurricane Michael as well as the California wildfires, resulting in net catastrophe losses of more than $37 billion.
How can you prepare for a hard market?
Brant Watson
Senior VP
D: 925.295.2506
C: 925.330.1151

What is Social Inflation?

Social inflation generally refers to the rising costs of insurance claims that are a result of societal trends and views toward increased litigation, broader contract interpretations, plaintiff friendly legal decisions, and larger jury awards.

What is causing social inflation?
There are four major factors that are driving social inflation in the United States today. They are litigation funding, the erosion of tort reform, negative public sentiment toward larger businesses and corporations, and desensitization to large jury awards.
There are four major factors that are driving social inflation in the United States today. They are litigation funding, the erosion of tort reform, negative public sentiment toward larger businesses and corporations, and desensitization to large jury awards.
Leverage your insurance partners. This means working with an independent insurance agent to make sure he or she understands your business and associated risks, and assists you in updating your insurance coverages and limits accordingly.
Just Contact me.

 

M. Brant Watson
Senior Vice President
Heffernan Insurance Brokers
Office 800-234-6787
Mobile  925-330-1151

Nuclear Verdicts and Social Inflation

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How much is pain and suffering worth? While it’s possible to calculate the costs of property damage, medical bills and even lost wages, punitive damages are another story. Lawsuits are always expensive, but nuclear verdicts can kick the cost up several notches, and they may set a precedent for higher awards in the future. At the same time, an increase in litigation of various types can also lead to higher and more frequent costs. The result is social inflation, a phenomenon that’s driving up insurance claims.

As Trust Falls, Awards Rise

According to an article in Law.com, many experts agree that jury awards are getting larger, and one explanation is that jurors are fed up and want to punish wrongdoers.

The 2019 Edelman Trust Barometer found that trust in businesses among the general population is 56 percent. Although there were slight increases between 2018 and 2019, distrust is still common. Richard Edelman, president and CEO of Edelman, says, “The last decade has seen a loss of faith in traditional authority figures and institutions.”

Trust is even lower when it comes to certain issues. A recent survey from the Pew Research Center reveals that people do not think their personal data is safe. When discussing companies, 81 percent of U.S. adults say they have little to control over the data that is collected on them, and 81 percent of U.S. adults also say that the potential risks outweigh the benefits.

Jaw-Dropping Verdicts

When people serve on juries, they bring their distrust in companies with them. This may contribute to large verdicts meant to punish companies and to make those companies serve as an example.

Billion-dollar award are not unheard of. For example, Monsanto was recently hit with a $2.055 billion verdict. A California couple sued over claims the Monsanto’s Roundup herbicide caused non-Hodgkin’s lymphoma, and the jury’s large award included punitive damages. However, according to the Los Angeles Times, the judge reduced the award to $87 million.

Johnson & Johnson was hit with an even larger verdict – $8 billion – in a lawsuit alleging that its antipsychotic drug Risperdal contributed to the growth of female breast tissue in boys and that the company valued profits over patients and safety. According to U.S. News, Johnson & Johnson will fight to overturn the award.

Protecting Your Company

Just as economic inflation means a dollar won’t go as far as it used it, social inflation means that your policy limits might not protect you as well as they used to. To keep up with changes in litigation trends, it is important to make sure your company has the right insurance coverage.

A strong risk assessment process can uncover potential liability issues so that the appropriate insurance coverage can be secured. Important coverage types include property, product liability and cyber liability insurance, among others.

Determining the right policy limit is tricky. With the rise of large awards, it is hard to say what’s enough. Thankfully, there is a solution. An umbrella policy provides a simple way of increasing limits on multiple insurance policies while also filling in potential coverage gaps.

Contact your Heffernan Insurance Brokers’ agent to learn more.

Workplace Harassment Prevention

We’ve partnered with ThinkHR to offer a solution to clients who are required to comply with this new law. Think HR has developed a completely new product to meet state requirements called Workplace Harassment Prevention.  Workplace Harassment Prevention gives employers access to new and existing mandated training courses and best practices for updating policies and procedures, reporting incidents, and following up on complaints within each state they operate.

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What Every Employer Needs to Know
California has expanded its current sexual harassment training standards for employers beginning January 1, 2019. The newly expanded law requires all employers with five or more employees, including temporary and seasonal employees, to train all supervisory and non supervisory employees in California by January 1, 2020.
As part of your People Risk Management strategy, Think HR offers workplace harassment prevention courses for both managers and employees, including specialized harassment training for the states of California, Connecticut, Maine, and New York. Each course incorporates the necessary state references to meet the standards for California’s sexual harassment prevention training.
Want to know more about the California law? Read more here.
Want more information contact me.

Best Regards,
M. Brant Watson
Senior Vice President
Heffernan Insurance Brokers
D: (925) 295-2506
M: (925) 330-1151

Nonprofits: Plug the “Money Leaks”

As we enter another year, it’s an exciting time for nonprofits.  However, with substantially more donations coming in this time of year, you need to be on your game when it comes to money management.Beware of these money leaks:
Theft and Fraud
. Theft can be perpetrated by anyone including vendors and contractors. A dishonest party could impersonate your nonprofit to host a fundraising event, and then pocket the profits and run.

  • Cybercrime. Internet and phishing scams are getting more sophisticated every day. Even Portland Public Schools almost transferred $2.9 million to a scammer pretending to be one of their trusted building contractors.
  • Regulatory compliance. The IRS has strict rules for nonprofits to maintain their tax-exempt status. Don’t let a slip-up cost you fines or loss of your tax exemption.
  • D&O liability. Your board’s directors and officers make the business decisions, including managing funds. A liability claim against one of them for misallocation of funds, wrongful termination, discrimination, harassment, or another event could be costly.
  • Rogue volunteers. If one of your volunteers steals or causes injury or damage, your organization could get hit with a negligence claim, and that can be costly to defend and settle.

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Webinar business insurance

On behalf of Heffernan, please join us for this interactive and informative Webinar!

Heffernan’s reputation and success was built through our work in industry niches s such as nonprofit, construction, healthcare, transportation, hospitality, food distribution, real estate and technology. With ten branch offices coast-to-coast and approximately 450 staff members, Heffernan’s reach spans to most industries!
With 30 years of underwriting and brokerage experience, I will evaluate your current and historic insurance placements and in many cases be able to offer your business meaningful and impact alternative cost, coverage and risk management program options to optimize your protection and competitiveness in your industry!

Contact me today to learn more about the best possible insurance for your needs.
M. Brant Watson
Senior Vice President
Heffernan Insurance Brokers
Office 800-234-6787
Mobile  925-330-1151

Careful Hiring Practices: An Essential Step in Reducing the Incidence of Workers’ Compensation Claims

The home health industry needs workers. The Bureau of Labor Statistics predicts an increase of 1,208,800 new home health aide and personal care aide positions between 2016 and 2026.  Finding workers to fill those positions may be difficult, leading to worries of a major worker shortage. But despite the need for workers, there’s also a need for smart hiring practices. To keep workers’ compensation claims down, employers must take precautions.

Workers’ Compensation Claims

Home health workers face risks that can lead to injuries, and these injuries can lead to workers’ compensation claims. These risks include:

  • Musculoskeletal injuries, often the result of lifting or maneuvering patients
  • Automobile crashes, which can occur when workers drive from one patient’s home to another
  • Assaults, which can occur if patients or others become violent
  • Other accidents, such as tripping and falling, which can occur because workers are constantly visiting different homes with unique layouts and risks

These risks can be made worse if workers are not physically capable of performing essential duties, such as lifting or maneuvering patients, or if they use poor techniques when doing heavy lifting. Dangerous driving habits and criminal tendencies – including filing fraudulent claims – can also result in expensive workers’ compensation claims.

Although these risks cannot be eliminated entirely, careful hiring practices can reduce them.

Want more information contact me.
Best Regards,
M. Brant Watson
Senior Vice President
Heffernan Insurance Brokers
D: (925) 295-2506
M: (925) 330-1151
Email brantw@heffins.com

Careful Hiring Practices

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California AB5 – What Does It Mean for Your Business?

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Classifying workers as independent contractors is about to get more difficult in California. The state has recently passed a new law, Assembly Bill 5, which establishes new rules for gig work. The law goes into effect on January 1, 2020, and it could have major implications for any business that uses contract workers.
January 14, 2020 Top Ten Ways to Prevent Employee Lawsuits Enroll Here
January 22, 2020 Heffernan Retirement eLearning: What You Need to Know About CalSavers Enroll Here
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Heffernan’s reputation and success was built through niche practice business such as nonprofit, construction, healthcare, transportation, hospitality, food industry, real estate and technology. With ten branch offices coast-to-coast and approximately 450 staff, Heffernan’s reach spans virtually every industry.
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