Tag Archives: Insurance

D&O Insurance: Important Protection for Important People

The most common misconception about Directors and Officers (D&O) insurance is that this coverage is only a necessity for large, publicly traded companies. Smaller companies with fewer shareholders may think their exposure to these types of claims may be minimal or nonexistent; however, private companies can face “professional liability” claims from several sources: employees, investors, creditors, customers, competitors, and government agencies just to name a few. The cost alone of defending such claims can sometimes be enough to cripple a business, with settlements and payouts being even more financially devastating.

D&O Insurance Defined:

Directors and Officers insurance is a type of liability insurance (payable to the directors and officers of a company or the organization itself), which covers these individuals/companies for claims made against them while serving as an officer of the company or on the board of directors for any alleged wrongful acts in their capacity as directors or officers.

What are some of the top reasons for private companies to carry D&O insurance?

    • Employment Practices Liability. Claims of workplace discrimination, sexual harassment, and wrongful dismissal can happen regardless of a company’s size or stature. These situations can be even more pronounced in smaller companies with a more hands-on management team.
    • Peace of mind when taking on investors. Those investing in a business expect to eventually see a return on their investment. However, if a business ends up failing and investors lose their money, they will look to recover it by way of legal action against top executives.
    • Personal asset protection. Directors and officers of private companies may have a fair bit of their own money and assets invested into their company, which can subsequently get dragged into defense costs, settlements, and judgements if found liable for any wrongful acts while operating in their duties.
    • Legal expenses. Companies can still get drawn into litigation even if claims of alleged wrongful D&O acts are groundless, and the costs to defend such unfounded claims can add up quickly.
    • It is now more affordable than ever. The market for D&O insurance has grown substantially over the past decade, with most insurance providers offering some form of coverage. Depending on the size of your company, D&O insurance premiums may only represent a small additional cost in proportion to the rest of your insurance coverage.

 

Perhaps most importantly, having a sound D&O insurance program in place offers peace of mind to management, allowing them to better focus their efforts on other important areas such as business growth and smooth operations. Getting a quote is easy – speak to one of our commercial insurance experts today about what options make sense for your business.

Drive safe and save: Ontario’s new Winter Tire Discount explained

The Ontario Ministry of Finance announced in the fall of 2015 that it will require all provincial insurance companies to offer a discount for drivers who have purchased and installed winter tires on their vehicles. This mandate, effective January 1, 2016, is part of the province’s plan to help reduce auto insurance rates. The most obvious component of this initiative is the savings that vehicle owners are rewarded with for taking steps towards safer driving. But what else should you know about the new Winter Tire Discount?

  • The discount was implemented effective January 1, 2016. This means that if you are purchasing or renewing an auto insurance policy after this date, you are now able to add this discount to your policy if you qualify. If your policy renews later in the year (say, in July for example), you may be able to add the discount to your policy mid-term, but some insurance companies require that the discount be added on at your next renewal – your broker will be able to confirm this for you.
  • Winter Tires are classified as: tires recognized as meeting or exceeding the minimum snow traction requirements set by the Rubber Association of Canada, and are designed for use in both cold weather and severe snow weather conditions. Tires that meet this requirement are marked with a snowflake & mountain symbol on the sidewall.
  • Keep your bill of sale. Insurance companies vary in regards to what documentation they require as proof that winter tires have been installed. Some simply require verbal confirmation, while others will require a copy of the bill of sale for the tires, the installation, or both. Again, your broker will be able to confirm this, but it is always best practice to keep your proof of payment on file in the event that a claim occurs in the future.
  • Most importantly, how much can you save? The discount varies from company to company, but typically falls within the range of 2-5%. Below is a short list of insurers and the Winter Tire Discounts they offer:
  • AIG – 3%
  • Aviva – 5%
  • Chubb Insurance – 3%
  • Guarantee Gold – 5%
  • Intact Insurance and Novex – 3%
  • Jevco Insurance – 2%
  • RSA Insurance – 3%

Be it a small or large amount of savings, the fact that auto insurers are finding new ways to encourage road safety is a step in the right direction. Not only does it protect the lives and vehicles of those they insure, but also the driving community at large.

To find out if you qualify for the Ontario Winter Tire Discount and how much you can save, speak to one of our personal insurance experts today.

Bodily Injury and Property Damage: A Cyber Perspective

Cyber-related risk is a hot button issue in the insurance community and the business community at large. Having a cyber component to your company’s insurance program is now the status quo, with many insurers offering stand alone cyber policies, or at the very least, endorsements and other add-ons that help in transferring this risk. These coverages protect against first party losses (e.g. system damage, business interruption, etc.) and third party losses (e.g. privacy liability if sensitive information is breached) that arise from cyber-related perils that are typically excluded under traditional property and general liability policies.

However, simply having cyber coverage in place does not mean that all areas of exposure to cyber-related losses have been covered off. While the threat of system cyber attacks are nothing new to businesses that have an online or technological component, companies may often overlook other areas that security personnel may not realize are connected to the internet or internal computing systems, such as heating and cooling systems, generators, certain pressure vessels, and other systems that have underlying controls. It is these types of systems that frequently lack basic security protocols such as user passwords, and have the potential to cause bodily injury (BI) to individuals or property damage (PD) if they are breached or tampered with in a malicious way. Furthermore, a company may be in for a rude awakening if they experience such as loss, only to find out that, depending on their policy’s wording, their cyber policy does not cover these types of losses, which are already excluded under standard property and general liability policies. For example, many property policies contain exclusions for any loss caused by “the use of a computer system as a means of inflicting harm.”Conversely, cyber policies feature broad exclusions for BI and PD. So what can be done to eliminate this gap in coverage?

“Difference in Conditions” (DIC) coverage presents one solution. Although not a typical feature of cyber policies, DIC coverage can be applied to a cyber-related BI or PD loss that (aside from its cyber-related cause) would normally be covered by a traditional property or liability policy, if not for its cyber-related exclusions – in effect, covering any “difference in conditions” between the underlying property/liability policies and the cyber policy. Unfortunately, this is not a typical offering of most cyber policies, so it is always important to review your policy wordings for any exclusions or limitations that may leave your company exposed to an uninsured cyber-related BI or PD claim.

Still trying to make sense of everything? Our experts are here to help! To learn more about cyber insurance and risk management, and to find out what exposures your company may have, speak to one of our advisors today.

 

[1] Marsh, Cyber Gap Insurance, Cyber Risk: Filling the Coverage Gap (2014) at 4, uk.marsh.com/Portals/18/Documents/Cyber%20Gap%20Insurance%20Brochure_Final.pdf

Classic Protection for your Classic Automobile

FAQ’s About Classic & Collector Automobile Insurance

  1. What qualifies my vehicle as a collector vehicle?

Vehicles that are infrequently used and in very good to excellent condition that are either maintaining or increasing in value. These vehicles are also used in car club activities, exhibitions, parades, functions of public interest or for private collection.

  1. What types of vehicles qualify for collector vehicle coverage?
  • Antique & Classic Vehicles (1800’s-1969)
  • Modern Classics
  • Exotics & Special Interest Vehicles
  • Military Vehicles
  • Street Rods & Customs
  • Replicas
  1. Are there any requirements that my vehicle must meet in order to receive coverage?
  • Qualification depends on usage, storage, and driving record
  • The vehicle must be used on a “limited” basis (typically 4,000 kilometers per year)
  • Collector vehicles valued over $50,000 should be stored in a fully-enclosed and locked garage when not in use

The above information is very broad, as the term “collector vehicle” is a broad term itself. Please contact a broker today for questions pertaining to coverage for your specific vehicle.

Season’s Greetings from The Hull Group

We’d Love to Hear From You!

Have you enjoyed our content this year? Is there a topic or focus in the insurance industry you’d like to read about? Tell us what you would like to learn more about from our insurance professionals.

Send an email with your suggestions to news@thehullgroup.com or Tweet @HullGroup. We look forward to connecting with you in the new year!

Newsletter Launch – July 1st

At The Hull Group, we understand that navigating through the plethora of insurance products available today can be overwhelming. With the onset of new risks like cyber and privacy threats, as well as a constantly changing legal environment, you need advanced expertise.

To help keep you current, we are excited to share with you our monthly newsletter which will feature industry updates, risk management tools, and information on insurance products.

To request your copy, please email news@thehullgroup.com or visit our website.