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The U.S. Department of Labor’s (DOL) Wage and Hour Division mandates that employers comply with the youth employment provisions of the Fair Labor Standards Act (FLSA) and the implementing regulations of 29 CFR Part 570. These provisions are designed to protect young workers by restricting the types of jobs that they perform and the number of hours they work. The DOL strives to educate teens, parents, educators and employers on the federal youth employment rules in order to promote positive and safe work experiences. The following self-assessment tool is designed to identify some of the most common problems encountered regarding young workers. If you answer “yes” to any of the following questions, you are likely not in compliance with federal regulations.

Do any workers under 18 years of age do the following:

  • Drive or serve as an outside helper on any motor vehicle (including but not limited to automobiles, trucks, golf carts, etc.) on a public road or highway?

Minors under 18 generally may not drive any type of motor vehicle or work as an outside helper on public roads or highways. This prohibition extends to the towing of vehicles and the driving of school buses and trucks. There is a limited exception to this provision that permits 17-year-olds to drive an automobile or truck (gross vehicle weight not exceeding 6,000 pounds) for limited periods of time when certain conditions are met. These conditions include that the minors possess a valid license, the driving is only during daylight hours, the driving does not involve urgent time sensitive deliveries such as delivering a pizza to a residence, and the driving is only occasional and incidental to their employment. There are additional requirements that also must be met.

  • Operate, set-up, adjust, repair, oil or clean any power-driven woodworking machine or perform any off-bearing from circular saws or from guillotine-action veneer clippers?

Minors under 18 may not operate, set-up, adjust, repair, oil or clean any power-driven wood-working machines, including chain saws, nailing machines and sanders. They also may not perform any off-bearing activities from circular saws or from guillotine-action veneer clippers or feed (or help feed) materials into the machines. A limited exception applies to 16- and 17-year olds that allows them to place materials on a moving chain or in a hopper or slide for automatic feeding. The regulations also provide a limited exemption for apprentices and student-learners who are at least 16 years of age and enrolled in approved programs.

  • Perform any activities that involve exposure to radioactive substances or to ionizing radiation?

Minors under 18 may not be employed in occupations that would expose them to radioactive substances and to ionizing radiations.

  • Operate or assist to operate, set-up, adjust, repair, oil or clean any power-driven circular saws, bandsaws, guillotine shears, chain saws, reciprocating saws, wood chippers or abrasive cutting discs?

Minors under 18 may not operate, assist to operate, set-up, adjust, repair, oil or clean circular saws, band saws or guillotine shears, except machines equipped with full automatic feed and ejection. These same minors may not operate, assist to operate, set-up, adjust, repair, oil or clean chain saws, reciprocating saws, wood chippers, or abrasive cutting discs. These prohibitions apply regardless of the materials being processed (wood, concrete, metal, foam rubber, cake, paper, etc.). The regulations also provide a limited exemption for apprentices and student-learners who are at least 16 years of age and enrolled in approved programs.

  • Work in any occupation in roofing operations or perform any work on or about a roof?

Minors under 18 may not be employed in roofing operations, including work performed on the ground and removal of the old roof, and all work on or about a roof. This prohibition includes any work that would require the youth to be on or near the roof at any time. The regulations provide a limited exemption for apprentices and student-learners who are at least 16 years of age and enrolled in approved programs.

Do any workers under 16 years of age do the following:

  • Work during schools hours?

Minors 14 and 15-years old may not work during school hours. School hours are determined by the local public school in the area where the minor is residing while so employed, even if the minor does not attend the public school (i.e., attends a private school or is home schooled). Such minors may be employed outside of school hours with certain limitations. The term outside school hours means such periods as before and after school hours, holidays, summer vacations, Sundays, or any other day or part of a day when the public school district where the minor reside while employed is not in session.

  • Work before 7:00 a.m. on any day?

Minors 14 and 15-years old may not be employed before 7:00 a.m. on any day.

  • Work past 7:00 p.m. between Labor Day and May 31st?

Minors 14 and 15-years old may not be employed past 7:00 p.m. from the day after Labor Day through May 31. This applies even if there is not school the next day, such as Friday or Saturday night, as well as in weeks when school is not in session such as during spring break. These same minors may not work past 9:00 p.m. between June 1 and Labor Day.

  • Work past 9:00 p.m. between June 1 and Labor Day?

Minors 14 and 15-years old may not be employed past 9:00 p.m. between June 1 and Labor Day. They may not work past 7:00 p.m. between the day after Labor Day and May 31.

  • Work more than 3 hours on a school day, including Fridays?

Minors 14 and 15-years old may not work more than 3 hours on a school day, including Fridays. This prohibition applies even if there is not school the next day.

  • Work more than 8 hours on any day?

Minors 14 and 15-years old may work up to 8 hours a day on Saturdays and Sundays and on other days when school is not in session, as long as they do not exceed the maximum permissible hours in any workweek. They may work up to 18 hours in any week school is in session and up to 40 hours in any week school does not meet.

  • Work more than 18 hours in any week when school is in session?

Minors 14 and 15-years old may not work more than 18 hours a week when school is in session. For these purposes, school is in session in any week in which school meets, even if it meets for a part of a day or a portion of the week. School hours and school weeks are determined by the local public school where the minor would attend if he or she attended public school.

  • Work more than 40 hours in any week when school is not in session?

Minors 14 and 15-years old may not work more than 40 hours in a week when school is not in session. They may not work more than 18 hours in a week when school meets. For these purposes, school is in session in any week in which school meets, even if it meets for a part of a day or a portion of the week. School hours and school weeks are determined by the local public school where the minor would attend if he or she attended public school.

  • Operate any power-driven machinery, other than office machines?

Minors 14 and 15-years old may not operate most power-driven machinery, including lawnmowers, trimmers, and “weed-whackers”. These minors may operate office machinery, vacuum cleaners, floor waxers, and machines and devices used in connection with preparing and serving food and beverages, such as dishwashers, toasters, popcorn poppers, milk shake blenders, coffee grinders and microwave ovens that do not have the capacity to warm above 140°F.

  • Ride as a passenger in a motor vehicle (other than public transportation) as part of the job?

The child labor rules allow 14- and 15-year-olds to ride inside the passenger compartment of a motor vehicle, but not when a significant reason for the minor being a passenger in the vehicle is for the purpose of performing work in connection with the transporting of, or assisting in the transporting of, other persons or property. As the transporting of, or assisting in the transporting of, other persons or property need only be a significant reason for the minor being in the vehicle and not the primary reason, permissible trips are fairly limited. When such youth are permitted to ride in the passenger compartment, each youth must have his or her own seat in the passenger compartment; each seat must be equipped with a seat belt or similar restraining device, and the employer must advise each passenger that such seat belts or devises are to be used. Fourteen- and 15-year-olds may never be employed as helpers on motor vehicles.

  • Work in occupations in connection with construction (including repair)?

Minors 14 and 15-years old may not be employed in any construction activities or on a construction site. A limited exception would apply for office or sales work when not performed at the actual construction site.

  • Work inside a freezer or meat cooler?

Minors 14 and 15-years old are prohibited from working in freezers and meat coolers. This includes duties such as taking inventory or performing cleanup work which would require them to enter and remain in coolers or freezers for prolonged durations. These minors may enter freezers momentarily —but not meat coolers—to retrieve items.

  • Perform any work in or about boiler or engine rooms?

Minors 14 and 15-years old may not perform any work in or about boiler or engine rooms.

  • Perform any work in connection with maintenance or repair of the establishment, machines or equipment?

Minors 14 and 15-years old may not perform any work in connection with maintenance or repair of the establishment, machines or equipment.

  • Perform any work requiring the use of ladders, scaffolds or their substitutes?

Minors 14 and 15-years old may not perform work requiring the use of ladders, scaffolds, or their substitutes.

  • Perform any outside window washing that involves working from sills?

Minors 14 and 15-years old may not perform outside window washing that involves working from sills, ladders, or scaffolds.

  • Cook?

Fourteen- and 15-year-olds may perform only that cooking that (1) involves the use of electric and gas grills that do not entail cooking over an open flame and (2) involves the use of deep fat fryers which are equipped with and utilize devices which automatically raise and lower the “baskets” but not pressurized fryers.

  • Bake?

Minors under 16 years of age are prohibited from performing any baking duties. Prohibited baking duties include the weighing, mixing and assembling of ingredients and the operation of pizza ovens and convection ovens. The use of warming devices to maintain the heat of cooked food is permitted.

  • Load or unload goods from a truck, railroad car or conveyor?

Minors 14 and 15-years old may not load or unload goods to and from conveyors, trucks, railroad cars or tanks, trucks, boats, planes, or other mean of transportation. See 29 CFR § 570.33 and Child Labor Bulletin 101. Such minors may load onto motor vehicles and unload from motor vehicles the light, non-power-driven, hand tools and personal protective equipment that the minor will use as part of his or her employment at the work site, and the personal items such as a back pack, a lunch box, or a coat that the minor is permitted to take to the work site.

  • Operate any hoisting equipment, including such equipment as scissor lifts, motorized hand trucks, forklifts, or grocery cart retrieval systems and cart caddies?

Minors 14 and 15-years old may not perform work involving the operation or tending or hoisting equipment—whether power-driven or operated manually or by gravity. Such equipment includes forklifts, scissor lifts, motorized hand trucks, patient lifts, winches, cart caddies, or QuicKart (used to move large strings of shopping carts from the parking lot to the front of the store).

Are any of your employees under 14 years of age?

Minors 13 years of age and younger are generally too young for employment under the Federal child labor provisions. Permissible employment for such minors is limited to exempt work such as delivering newspapers, performing casual babysitting, acting, performing minor chores around private homes, and working for a parent who is the sole owner of a business (in occupations other than mining, manufacturing, or anything prohibited by an HO).

  • Do you fail to maintain a record providing proof of age for all employees under 19 years of age?

Employers are required to maintain and preserve certain records, including the date of birth for all employees who are less than 19 years of age.

Employers may protect themselves from unintentional violation of the child labor provisions by keeping on file an employment or age certificate for each minor employed to show that the minor is the minimum age for the job. Although the Wage and Hour Division no longer issues age certificates, certificates issued under most state laws are acceptable for purposes of the FLSA.

Source: DOL

Several larger cities in Missouri (as well as all over the U.S.) have recently seen the emergence of “ride for a fee” services.   These are “taxi-cab-like” services provided by private passenger car owners using their personal autos.  The two top companies providing these services are Uber and Lyft.

While this relatively new transportation program has received rave reviews for excellence in service, there are insurance issues to be considered by both the service providers as well as the passengers.

Most private passenger auto insurance policies have a very clear exclusion of coverage when a fee is paid and received for “ride services” rendered by the insured.  While Uber provides insurance when you are driving for them, there is still an insurance gap.  Cars used for Uber services have an app installed that clearly tracks the time the driver is transporting a client, or not – or when they are looking for a customer’s location.  When the driver is transporting a client, there is coverage from Uber.  While the app is turned off, there is coverage by the personal auto policy.  But while the app is on and the driver is looking for a customer’s location, there is coverage from neither policy.

In addition, many personal auto insurance policies are being cancelled once the insurance companies find out that the driver works for Uber or Lyft, so they are stuck with no personal auto coverage.

The media is reporting that there are a few  insurance companies who are offering coverage (under a completely separate policy) for that period of time covered by neither Uber nor the personal auto policy.

In the meantime, it is wise to beware of the potential lack of insurance coverage – both as a driver providing services as well as passengers.

Recently, your health insurance company may have requested your Social Security number, as well as the Social Security numbers of your spouse and your qualifying dependents. Due to a new reporting requirement, you will need to report qualifying health coverage (referred to as “minimum essential coverage”) on your yearly income tax return. This new reporting requirement will begin for the 2015 tax year, and your Social Security number is required by the Internal Revenue Service (IRS) for Form 1095-B. Here are some common questions you may have regarding this process.

Why has my health insurance company requested that I provide them with my Social Security number? 

Your health insurance company is required to provide Form 1095-B to you and the IRS. This form will contain the Social Security numbers of you, your spouse and any qualifying dependents. You will use this form to prepare your individual income tax return. Health insurance companies need time to program and test systems to ensure the new reporting requirement is done correctly and efficiently.

Will the IRS mail me the form so I can provide this information to my health insurance company? 

No. Your health insurance company may mail you a written request which discusses these new rules.

How will I use Form 1095-B? 

Form 1095-B provides the information you need in order to report on your income tax return that you, your spouse and your dependents had minimum essential coverage for some or all of the months during the year. Individuals who do not have minimum essential coverage and do not qualify for an exemption may be liable for the individual shared responsibility payment. You do not have to attach Form 1095-B to your tax return.

What if I refuse to provide this information to my health insurance company? 

The information received by the IRS will be used to verify information on your individual income tax return. If the information you provide on your tax return cannot be verified, you may receive an inquiry from the IRS. You may also receive a notice indicating that you are required to make a shared responsibility payment.

For more information on reporting your Social Security number to your health insurance company, contact your Naught-Naught Agency representative.

Life insurance isn’t a fun thing to think about, and it may seem like an unnecessary expense. But if you have people who depend on you for financial support, then life insurance is really about protecting them in case something happens to you – your designated beneficiary would collect a financial benefit upon your death. Life insurance can be confusing, so here’s a rundown of the basics.

Types of Life Insurance

  • Term: This is the simplest and generally the cheapest form. You buy coverage for a specific period of time. It can usually be renewed, but premiums will increase based on age and health factors. There is no cash value.
  • All other types of life insurance are permanent, but there are several varieties. They all include a savings element that builds cash value, in addition to the death benefit. Once that cash value accumulates, it is accessible to the policyholder tax-free. The following are some of the common types of permanent life insurance.
  • Whole Life: You purchase this policy to cover your entire life, as long as you keep paying premiums. Premiums remain constant throughout the policy, and the company invests a portion of your premium that becomes the cash value. These are more expensive than term policies in the early years, but they even out because the premium does not increase.
  • Universal Life: This policy is similar to whole life, but has the potential for higher earnings on the savings component. It is more flexible in terms of changing premiums and face value throughout the policy. There is usually a guaranteed return on the cash value. Disadvantages include higher fees and the possibility of increasing premiums.
  • Variable Life: A variable life policy generally has fixed premiums, and you have control over the investment decisions for the cash value portion. However, this is riskier because there is not guarantee for the cash value.

How Much to Buy?

offers life insurance as part of our benefit package, but it’s hard to know how much to buy. Many people decide based on an income replacement calculation, between 5 and 10 times the amount of your current income.

Think about your personal circumstances: Is yours the sole income in your household? Are there other expenses, such as college tuition, that may arise in the future? Don’t forget to include potential medical and funeral costs. Above everything, you want to be sure your family does not get stuck with bills, debts or expenses that they cannot afford. Depending on your needs, you may want to consider buying supplementary coverage beyond what offers.

Why Purchase Now?

Buying life insurance may seem unmanageable right now, but it could be a smart decision. Unlike many other benefits, life insurance is actually more affordable right now than in the recent past. Plus, during this tough economic period, ensuring that your family will be financially secure in the future is more important than ever.

If you have more questions about our life insurance benefit, please make an appointment with Naught-Naught Agency.

First, let’s review the types of heat-related illnesses so we are all aware of emergency situations and are prepared to get medical help when needed.

  •  Sunburn – Not only are sunburns painful at the time, but exposure to too much sun could lead to skin cancer.
  • Heat Rash – Sometimes called prickly heat, the best way to avoid this is to bathe regularly and keep your skin clean and dry.
  • Heat Cramps – Painful cramps, often in the legs, arm or stomach, can happen when you are sweating heavily but are not getting enough of the minerals your body needs to replace the minerals lost in sweat.  The symptoms of heat cramps may not show up until after physical activity.  Avoid heat cramps by drinking plenty of fluids and eating a balanced diet.
  • Heat Exhaustion – Symptoms include:  heavy sweating, thirst, clammy and pale skin, fatigue, weakness and loss of coordination.  A person with heat exhaustion may also be anxious, faint, confused, have a headache, nausea or vomiting and loss of appetite.  Heat exhaustion can be serious.  Move the person to a cool area and encourage them to drink water to prevent dehydration.  They may also need medical attention.
  • Heat Stroke – Heat stroke is the most serious heat-related illness.  The body has lost its ability to cool itself.  Death can quickly result if not treated promptly.  Usually the most striking symptom of heat stroke is the absence of sweating.  The skin is red, dry and hot.  The pulse is rapid.  The person may complain of headaches, dizziness or nausea and may appear confused or delirious.   Fainting, seizures or collapse may occur.  A person in heat stroke needs immediate medical attention at an emergency room or hospital.  While help is on the way, move the person to the coolest spot nearby and try to cool their body.  They can be immersed in water but don’t place them in ice water.  Don’t give them anything to drink since they may lose consciousness.

We can’t do much about the weather except wait for fall, but there are some things you can do to help reduce the likelihood that you will have a heat-related illness:

  • Gradually get used to the heat – It takes about two weeks for your body to adapt to hot conditions.  If you are away for as little as a week (on vacation, for example) your body losses this ability; you will have to get used to the heat again.
  • Dress for the heat – Light colored, loose clothing is better than going bare skinned.  If you will be outside, wear a hat; use sunscreen to prevent sunburn.
  • Drink plenty of fluids throughout the day – Make sure you have ample cool, clean water available.  Your body needs water before you feel thirsty.  Water, fruit juice or sports drinks are best.  Sodas, coffee and tea all contain caffeine and should not be your main source of fluids.
  • Limit your intake of alcohol – Alcohol causes dehydration and can be a big contributor to the more serious heat-related illnesses.
  • Eat well-balanced meals – You need to make sure your body’s stores of vitamins and minerals don’t get depleted.  Fresh fruits and vegetables contain needed nutrients plus water.
  • Get plenty of rest – We all have lots of things going on during the summer, but when we don’t get enough rest, that puts additional stress on our bodies.
  • Take frequent breaks in the shade or a cooler area – These breaks help reduce the heat load on your body.   Plan your work or play to take advantage of cooler morning hours.  Move to shaded areas when possible.

Keep a close eye on people around you who have health conditions that may make them more susceptible to heat-related illnesses.  If someone looks like they are having heat exhaustion or a heat stroke, take action fast to get them to a cool area and get medical attention.    

Take care of yourself and those around you this summer and you’ll have it –


 (Taken from Missouri Rural Services newsletter)

What do I need to do?

Put safety first.

Windows are broken. Roofs and cars take a beating. High winds down trees and power lines.

When you survey your damage, remember that there may be broken glass, sharp objects and live wires. Wear proper shoes and gloves. Don’t use rain-soaked electrical equipment. Always make safety your first priority.

 Call 1-800-392-0423 to file your claim.

If you have hailstorm damage, report it to Naught-Naught Agency as soon as possible. During this first call, you should be ready to provide at least a general description of your damage. A representative will talk you through your claim, recording the details. A claim professional will call you after you’ve reported your claim. Most of the time they are able to make contact within 72 hours. If you have serious damage, they will make every effort to get to you first.

Make temporary repairs

If hail has caused damage to the roof of your property or your car, it is your responsibility to take action to avoid further damage.  If you can, cover broken windows and roofs with tarps or plywood to prevent water damage. Move wet items to drier ground and wash and dry whatever you can. If you’re not sure it’s safe for you to do the work, professionals can help. You’ll usually find them listed under “contractors” or “water damage restoration” in your phone directory.

Make sure to save receipts from any temporary fixes as part of documenting your damage.

Review your insurance policy, so you know what’s covered.

Your insurance policy typically covers the cost to repair common hail damage — including damage to roofs, walls and cars, and your inventory or belongings.

However, your deductible does apply — and you may have a higher deductible for wind/hail damage on your policy. Check your policy to see what’s covered and the deductible you’ve chosen. Reviewing your policy will help you prepare questions for your claims professional.

 Document your damage.

As soon as you can, start making a list of items that were damaged in the hailstorm.

A good, thorough list will help us process your claim faster. Document the damage with photos, videotapes, bills and receipts. In the meantime, don’t throw out damaged items — especially expensive ones

While most small business owners consider themselves optimists, too much optimism, can get a small business owner into trouble.  That’s why wise business owners temper their innate optimism with a healthy does of reality.  In other words, they learn to manage risk.  Listed below are the top 10 threats to small businesses.

  1. Protecting your property – Begin by taking a complete inventory of all your assets to determine how a loss might affect your business and how much coverage you need.  Leaving your small business underinsured is a risk too great to take.
  2. Business interruption –  The U.S. Department of Labor estimates that more than 40% of businesses never reopen following a disaster such as a fire or flood.  With the proper insurance in place, you would be able to move to a temporary location to continue operation while your permanent place of business is being repaired.
  3. Liability losses – The only way to completely avoid liability exposures is to shutter your business.  A Commercial General Liability (CGL) policy provides coverage for claims of bodily injury or other physical injury, such as libel or slander, advertising injury and property damage as a result of your products, premises or operations.  The CGL policy enables you to continue normal operations while dealing with real or fraudulent claims.
  4. Key person losses – Many small businesses are built around the talents and expertise of a few individuals.  If an employee crucial to the functioning of your business departs unexpectedly due to death or injury, would day-to-day operations continue as usual?  Key Person Insurance provides financial stability in a time of stress and uncertainty, allowing you to keep your business moving forward.
  5. Injuries to employees – Many businesses do not realize he full effect workplace accidents have on their organization.  Beyond initial treatment costs and lost production time, on-the-job injuries have an impact on insurance premiums, which can increase your costs for years to come.  Thankfully, by  managing exposures and promoting safety, it is possible to control workers’ compensation premiums.  See your NAUGHT-NAUGHT AGENCY representative for no-cost safety programs.
  6. Managing electronic data and computer resources – Based on an estimated liability of more than $200 per compromised record (multiplied by hundreds or thousands of customer records), the cost of a single data breach incident can be devastating for a small business.  In addition to taking preventative measures to reduce Internet-based exposures, specialized technology coverage, such as Cyber Liability Insurance can help protect your business against damage from cyber attacks, data breaches and other Internet-based exposures.
  7. Environmental Exposures – Most people think of a large manufacturing, mining or petroleum operation when they think of environmental exposures.  However, it is important for small businesses to also perform a comprehensive risk analysis to determine your own level of exposure.  Because most commercial insurance policies contain pollution exclusions, unless you carry Environmental Insurance, you may be uninsured against these exposures.
  8. Employment practices – Statistics show that 3 out of 5 employers will be sued by a prospective, current or former employee while they are in business.  Although many lawsuits are groundless, defending against them is costly.  There is an insurance solution called Employment Practices Liability that will protect your company against wrongful termination, discrimination (age, sex, race disability, etc.) or sexual harassment lawsuits.
  9. Contracts – When first starting out, many new business owners simply don’t have the time or expertise to adequately evaluate each clause in everything they’re signing.  While it is tempting to shave costs by skimping on legal fees, making sure your business isn’t accepting additional and unnecessary risk (from savvy suppliers or customers) can save you a lot of money over the long haul, both in legal costs and in insurance coverages.
  10. Manage your supply chain – Do you rely on one or more third-party suppliers to produce certain components used in your products?  If so, a disaster that interrupts your supplier’s regular business operations could have a crippling effect on your production abilities.  Sometimes there is little you can do about the exposures faced by your supplier.  Supply chain insurance is meant to cover losses you incur as a result of an interruption to your supply chain.  Such coverage allows you to work confidently with suppliers.

Insurance is a key component of any comprehensive risk management plan, but successful risk management also involves prevention,  training and contingency planning.  Contact your NAUGHT-NAUGHT AGENCY  representative to learn more about the tools and resources we can offer to help you manage risks, advance safety and boost employee morale.

Every year at this time we hear of taxpayers who learn their identity has been stolen when they attempt to file their tax return.  We tend to think all identity theft occurs on line but this is incorrect.  According to claims data, 44% of ID fraud cases happen when a person’s purse or wallet has been stolen or lost.

Here are some suggestions for the prevention of tax fraud and identity theft:

  1. File income tax returns early to beat the would-be thieves to the punch.
  2. Do not leave tax forms in the car and shred any paperwork you do not need before throwing it out.
  3. Be suspicious of any email claiming to be from the IRS, as the IRS does NOT contact taxpayers by email or phone.
  4. When shopping online, be sure the payment page has an “s” in the URL (https:// instead of http://).  This “s” indicates a secure socket layer.
  5. Do not send personal information in email or instant messages.  These can be easily intercepted.
  6. Do not click on links you receive by email that are from unknown sources.
  7. Be cautious of emails you receive regarding your financial accounts.  Instead, contact your financial institution directly.
  8. Keep purses or wallets in a safe place and carry only essentials when you go out.
  9. When mailing checks or financial information, use a locked mail deposit box.
  10. Keep a careful eye on your credit by reviewing your credit report regularly.

These precautions will help to manage and protect your personal information.

HO Premiums from National Underwriter

Image above from the National Underwriter Property and casualty magazine Feb 2015 

We see it all the time – charts showing price increases…………in everything from groceries to home prices.  But what we do with those charts is a key component to managing our daily expenses.

A recently published chart on the industry ‘Average Premium For Home Insurance Policies’ from 2000 to 2014 was, indeed, revealing.  (A copy of this chart can be found by clicking the link at the end of this article.)  While many of the factors going into homeowners premiums are out of our control (storm damage, court awarded settlements), there are ways to help control/manage this item in our budgets.

For starters, work with your agent to be certain you are getting all the credits available to you.  Here are some examples:

  1. Home Security – smoke alarms, dead bolts, fire & burglar alarm system
  2. Roof – if recently replaced or if shingles are storm resistant
  3. Stay with the same carrier – earn renewal credits
  4. Maintain a good credit history
  5. Multi-policy – insure home, cars, boats, motorcycles, umbrella with one carrier
  6. Increase the deductible

Let’s take a look at #6 – increasing your deductible.  First, review your claims history.  Most preferred policyholders have a very good claims history.  If that describes you, ask your agent to quote two or more levels of higher deductibles.   This is the same theory that applies to all types of insurance – including health insurance as well as auto insurance.  If you can reasonably afford to ‘self insure’ for the first $1,000 or $1,500 of a claim, you may find you can easily justify this change – and save premium dollars as well.

Drone – noun – definition:


1. A male bee, especially a honeybee, that is characteristically stingless, performs no work, and produces no honey. Its only function is to mate with the queen bee.

2. An idle person who lives off others; a loafer.

3. A person who does tedious or menial work; a drudge:

4. A pilotless aircraft operated by remote control.”

The above definition appears in more than one on-line dictionary – which, strangely enough, gives us some insight into how new this phenomenon actually is!   However, it is important for the public as a whole to understand the many ways this aircraft will touch our lives.

The FFA (Federal Aviation Administration) describes three types of UAS (Unmanned Aircraft Systems). They are: Public Operations (governmental), Civil Operations (non-governmental) and Model Aircraft (hobby or recreation only).

We have heard and read for several years of the ways UAS have been used by governments for reconnaissance and surveillance purposes as well as those armed with missiles and bombs.

We are also learning more about delivery drones. In February, 2015, the Chinese e-commerce company Alibaba said on its blog that it has began a 3-day drone delivery test to deliver a special type of tea. Customers must live within a 1-hour quad copter flight of Alibaba’s warehouses in Beijing, Shanghai and Guangzhou.

In December, 2013, the DHL parcel service subsidiary of Deutsche Post AG tested a “micro drone md4-1000” for delivery of medicine.

Amazon reports the following “We’re excited about Prime Air — a future delivery system from Amazon designed to safely get packages into customers’ hands in 30 minutes or less using small unmanned aerial vehicles. Putting Prime Air into service will take some time, but we will deploy when we have the regulatory support needed to realize our vision.”

Additionally, there has been discussion in the insurance industry regarding the use of drones by claims adjusters at some point in the future. After a catastrophe hits, for example, it is conceivable that a drone be sent to evaluate damage within hours of it occurring.

The FAA has developed an educational program called ‘Know Before You Fly,’ a campaign to educate the public about using unmanned aircraft safely and responsibly as a hobby. These hobby drones are available today at your local big box store at a price as low as $50. However, the FFA continues to work on regulations for drones used for any purpose. The only thing we can be sure of is that we will see and hear of many versions of these regulations for all three categories before they are finalized.

Clearly, the unmanned aircraft industry is poised for ‘takeoff,’ with dramatic implications for everything from public safety, to farming, to infrastructure maintenance. Already, unmanned aircraft are enabling jobs ranging from agricultural monitoring, to wildfire surveillance to be done more safely, cost efficiently and effectively than ever before. As regulatory hurdles are cleared, use of unmanned aircraft across a spectrum of industries will accelerate rapidly.

All of this brings into question the issue of insurance for these unmanned aircraft – be it for commercial purposes or hobby purposes. Commercial General Liability policies have always excluded actions related to aircraft as do Homeowners policies. Clearly, the reason for these exclusions is to eliminate needed premium charges for the vast majority of insureds who do not have a need for these coverages. Typically, unusual exposures, such as those present with aircraft or boats, are covered under separate and specialized insurance policies available to those who have need for the coverage.

Currently, there are specialty carriers who have liability coverage available and these carriers are available to NAUGHT-NAUGHT AGENCY. We urge you to discuss any of your current or future insurance needs in this area with your NAUGHT-NAUGHT AGENCY representative.