With this recent downfall of snow, it helped me see some of the potential hazards that arise around my home due to the snow fall.  I urge you to take an assessment of the hazards that may occurr around you home and be proactive in eliminating them.

There was so much snow on my roof that it drifts over the edges of the roof and creates an avalanche below.  Luckily I haven’t been standing underneath my eaves as the snow comes crashing down, but it is fun to watch from the inside of the house.  It can be so loud that it will sometimes wake me in the middle of the night and I’m a sound sleeper.  I realize that when I leave my front door, I need to look up before proceeding, so I don’t get clobbered, but what about my unsuspecting guests or mail person who aren’t aware of the dangers around my house.  There is a potential hazard of snow and ice dropping from 20 feet above, which could injure someone pretty good.  If you see these drifts on your roof be proactive and get a snow rake from your local hardware store that will allow you to remove some of the snow from your roof.  I do not recommend getting on the roof with a shovel, with the ice and snow build-up you are only asking for a fall and even with all of the white fluffy snow below a fall off the roof will hurt. 

I also recommend checking around the outside of your house for spots where ice forms that could be potential slip hazards for you and your guests.  Remove all of the snow and ice from these areas like steps, walkways and driveways and if necessary use some salt or snow melt to remove any of the remaining ice.  I have a couple of steps on the side of my house that buildup ice and I’m always try to remove it because even though we don’t use the steps at all in the winter, I know that the RG&E meter reader and any other utility company employees will use those steps to get to the back of my house and I want to make sure that anyone that accesses my property is safe. 

Now if you have icicles that build up around your house, you most likely have a heat loss problem.  I would recommend speaking with a qualified contractor to resolve the problem.  Not only are you wasting money on expensive heating bills, but icicles have the potential danger of falling onto someone and injuring them or causing damage to your house like tearing the gutters off or leaking back into the house as the ice damns up and can get under your roof shingles. 

When there is so much snow you run out of places to put it.  I find it tough to see out of the end of my driveway because the snow banks are so high.  I get a double whammy with the street plow and the sidewalk plow.  I make sure that I go slow out of my driveway to make sure that there isn’t any traffic coming that I wasn’t able to see behind my banks and when I have time I try to get out there and knock down my banks, so I can see better. 

Be sure to take an assessment of your house to see where your potential hazards are for you and your guests and do your best to eliminate them. 

With all of the recent hype regarding the Toyota recall insurance agents have received a number of calls from our clients asking us if they are in an accident while driving their Toyota and the accident is caused by your accelerator pedal being stuck under the floor mat in the open position or the accelerator pedal mechanism staying partially depressed or returning slowly to the idle position, will their auto insurance provide coverage for them? 

Well one of the insurance companies that I represent Erie Insurance came out with a statement to ease drivers worries:

If you own a Toyota included in the recent recall and have an accident, or if you are involved in an accident with a recalled vehicle, Erie Insurance wants you to know that the Toyota recall will not have an effect on whether there is coverage available to you for the loss.  ERIE will provide coverage for your loss, subject to applicable policy terms, conditions and deductible. Simply report the claim, as you would any claim, to your ERIEagent or call our 24/7 toll-free claims hotline at (800) 367-3743.

To find out the most recent information regarding the recall be sure to visit Toyota’s website at http://www.toyota.com/recall/?srchid=K610_p228906387.

I’ve grown up pretty much my entire life having dogs as pets.  Christine and I adopted a mutt named “Barney” from Lollypop Farm about 5 years ago.  I enjoy hauling my dog around with me when I can in the SUV (weather permitting, of course).  I’ll take him to the dog park or we’ll bring him on a hike with us, I never really gave much thought about what would happen if we were in a car accident, until I started to sell insurance and my perspective on everything changed. 

I have a grate that keeps him in the back of the vehicle, so he’s not jumping over the seat or licking my ear/face when I’m driving.  I figured this would help keep him in the back of the vehicle in case we were ever in an accident and help protect him and us.  Even though the grate will keep him from propelling into the back of us or even worse out of the vehicle, undoubtedly he would still sustain some injuries depending on the severity of an accident. 

Now I know that if I’m hurt in an accident or any of my passengers, my auto insurance policy with pay for my medical bills.  But what about Barney’s medical bills?  Two of the insurance companies that I represent will cover the medical bills for your dog/cat, Erie Insurance and Progressive Insurance.

Erie Insurance will pay up to $500 per animal for reasonable veterinary costs incurred due to an injury in a covered auto accident.  If the injury results in death, Erie will pay up to $500 to replace the dog/cat, which includes the first wellness visit and the cost to spay or neuter the dog/cat.  There is no deductible applied to this pet coverage.  Anyone that has an Erie Insurance Auto Policy automatically has this coverage built into their policy at no additional cost. 

Progressive provides up to $1,000 for veterinary bills for your animal that is injured in a covered auto accident.  Progressive will pay you up to $1,000 to replace your animal, even if you opt not to replace your animal.  Now in order for Progressive’s pet coverage to apply to your policy, at-least one of the cars on your policy has to have collision coverage.  If you have collision coverage on at-least one vehicle, the pet coverage is automatically included on your policy and applies to all vehicles on the policy even if they don’t have collision coverage. 

For all of the dog/cat lovers out there, these are great coverages to protect your pet. 

With all of the snow that we had this past weekend and are projected to get for the rest of the week, how could we not talk about snowmobiles.  I’m sure some people may have even given or received a snowmobile as a gift this past holiday season. 

I know my neighbor received a snowmobile for Christmas, I could tell by all of the tracks in his front yard.  Good thing he received a trailer to haul his snowmobile because I don’t think he’ll get his riding fix on our city sized lot.  So that brings up the questions of insurance and registration, if he is going to take his snow mobile off of his property what does he need to do?

NYS says that if you plan to ride your snowmobile on your own private property or someone elses that you have express permission to ride on you are not required to register your snowmobile with the DMV.  But if you are planning to ride on public trails you do need to register your snow mobile with the DMV and pay a $100 fee.  Now if you are a Snowmobile Club Member your registration fee is only $45.  You can find a local club to join at http://www.snowmobilingusa.com/Snowmobile_Clubs.htm. 

Surprisingly, the DMV doesn’t require snowmobilers to carry insurance.  This opens riders up to a huge risk because if you are injured by another rider most likely they won’t have insurance to cover your medical bills and you won’t have any insurance to cover them yourself.  Snowmobile insurance policies are similar to motorcycle policies in the fact that they don’t automoatically provide any medical coverage to the rider, it needs to be selected and you pay an additional premium for it. 

Now you can insure your snowmobile relatively inexpensively by adding them to your homeowners or auto insurance and these will provide you with limited liability coverage in case you injure someone else.  You can even insure your sled for any physical damage caused by an accident.  Adding your snowmobile to your auto or homeowners insurance is better than having no insurance at all, but we recommend purchasing a separate snowmobile insurance policy.  It is a little more expense, but the coverage it provides you is better because you can select medical coverage to help pay for your hospital bills if you are injured while riding.

According to the National Burea of Labor Statistics, 3 out of 10 homeowners operate a business out of the home.  More than 66% of the estimated 20.7 million people who work at home are self-employed and run a home based business.  It’s estimated that more than half of the homebased businesses are underinsured.  40% of those survey by the Independent Insurance Agents of America say they were uninsured because they believed that their homeowners insurance covered the business.

When you started your business out of your home, getting insurance to protect you probably wasn’t at the top of your to do list or you were one of the 40% above and thought that your homeowners insurance would cover you.  It is important to get insurance coverage for your home based business to protect you when the unexpected happens and it will!  Your homeowners policy specifically excludes any claims resulting from business pursuits and provides a minimal amount of coverage for any business property (usually less than $2,000). 

The least costly way to cover your business is to add an endorsement to extend your personal liability coverage on your homeowners policy to cover your business pursuits.  This is extremely important coverage to have, especially if you are going to have client meetings at your home, customers coming to you home to drop-off or pick-up merchandise, or have any other members of the public enter your home.  The liability coverage will protect you in case anyone is injured while they are on your property.  You can usually add business liability coverage to you homeowners insurance policy for less than $100/year.  If you wanted to get a separate business liability policy the premium would start at $300-$500/year.

Now most homeowners policies will limit the amount of coverage that they will provide for property related to the business, so you will have to purchase extra coverage to cover your business property.  So be sure to ask what the business property limits are to make sure that you are adequately covered.  You don’t want to find out at the time of a fire that your $10,000 of inventory that was destroyed was only insured for $2,000.  Now some insurance companies will automatically increase the amount of coverage for your business property when you extend your liability coverage.  The company will allow you to allocate up to 10% of the insurance that you carry on your personal belongings to cover your business property. 

Other types of insurance that a home based business might want to take into considerations are: workers compensation (if you have employees), product liabililiy (if you make a product and it doesn’t work correctly or causes injury to someone), errors and ommission (if you provide a service like accounting, insurance or attorney), malpractice (for doctors that have offices out of their home)

Having your identity stolen, is a fear at the back of most people’s minds.  There is a great deal of our personal information in electronic form that is held by companies.  If these companies are hacked into our information can be compromised.  Before you know it you are suddenly receiving collection notices for credit cards that you don’t have and for services that you haven’t received. 

Now if you have a homeowners or renters insurance policy with Erie Insurance they have a Identity Recovery Coverage that you can add to your policy for $20/year.  This coverage provides you with $25,000 to help you cover the cost of restoring your identity.  The $25,000 includes $5,000 for loss wages that you may have to incur because you have to miss work to go to legal hearings associated with recovering your identity.  The $25,000 also covers the cost of re-filing applications for loans, grants or other credit instruments, certain legal fees, notarizing affidavits, ordering credit reports and actual costs for supervision of children, elderly or infirm relatives or dependents. 

This is a nice coverage to help you recover your identity, but it’s not going to help you prevent your identity from being stolen or help you identify if you identity has been stolen.  If you are really concerned about having your identity stolen, I would recommend one of the companies like Lifelock, Identity Guard or Watchdog, which are going to actually help to prevent your identity from being stolen.

Everyone sooner or later will have a contractor come to their house to do some repair work.  It can be as small as fixing a leaky faucet, adding a few new electrical outlets or larger jobs like re-roofing your house or building an addition.  It is important to always get 3 quotes for any major repairs to make sure that you are getting the best value for your money. 

When you are getting your quotes you will have the common questions that will help you determine which contractor will get the job, like what materials will you use?, how long will it take to complete the job?, when would you be able to start?, do you offer any type of warranty?.  These are all valid questions, but the question that most people will overlook is whether they have insurance or not. 

Now most contractors will volunteer their insurance information to you and show you a piece of paper as they’re going through their presentation showing that they have insurance.  I would ask you to go a step further and ask them to have the insurance company send you a certificate of their insurance listing you as a “certificate holder” or even better an “additional insured”.  This will allow you to get a certificate directly from the insurance stating they have insurance and the amount of insurance that they carry. 

You wouldn’t want to find yourself in a situation that a contractor caused damage to your house, but you weren’t able to repair it because the contractor didn’t have insurance or they did have insurance at one point, but they were late on a payment and it cancelled the week before they started your job. 

I decided last week that this week’s blog post would be about contractor’s insurance because I had a prospect call looking for insurance for his business.  I asked him my usual questions learning more about his business and himself.  I usually ask if they have a website and he did, so I went and checked it out.  All over his website it stated that he was fully insured and bonded.  He seemed to be advertising this for quite a while because I googled his company name and I was able to find old promotional flyers on-line from previous years that stated the same thing. 

The funny thing is that when I was asking him about his business he said that he didn’t have prior insurance, so I called him back and asked when was the last time that he did have insurance, thinking that he may have just let it lapse for a month or a year.  He said that he never had insurance that he bought the business from his uncle in the 90s and he thinks that he may have carried insurance on the business back then. 

That is why it’s important not to rely on the ads that state that the contractor is fully insured and to actually take the extra step to have the insurance company send you a certificate verify their insurance coverage.  Now most contractors’ are honest, but it’s important to make certain that you are covered.  If someone comes in with a super low bid for your job, it might be a good indication that they’re not properly insured.

I was reading an article in the Insurance Journal over the weekend and the article was about what happens when fun ‘n games at work take a bad turn.  The article was in reference to a lawsuit where an employee sued their employer because they were injured during a company picnic while participating in one of he activities. 

The employee and her partner had already won the hula-hoop contest and balloon toss.  The last event for them to win was the 3-legged sack race to clinch first place and the $50 prize.  Unfortunately the employee fell during the sack race and injured her shoulder. 

The employee thought that her injury should have been covered by workers compensation insurance, but coverage was denied because they deemed the activity voluntary.  The employer sponsored the picnic, approved the activities and had an award for 1st place, but did not force anyone to participate. 

This case hinged on whether the court felt that the activities were voluntary or if people were being forced to participate. 

There is a great opportunity for team-building when employees participate on employer sponsored teams and in company activities.  It’s an opportunity to get to know your colleagues outside of work and possibly showcase some talent that you might have outside of the workplace.  As an employer the important thing to remember is to keep the activities voluntary.  If someone is injured while participating on one of your employer sponsored teams or in one of your employer sponsored events, your workers compensation insurance is going to determine whether the activity was voluntary or not to determine if a payment should be made. 

Larson’s Worker’s Compensation Law is often used as a general guide to determine if recreational and social activities are within the course of employment and should be covered under workers’ compensation.  The “Larson Test” considers the following when an injury occurs:

• Did the injury occur on the premises during a lunch or recreational period (I’ve seen a number of warehouses that have basketball hoops for the employees to use on their breaks)
• Did the employer expressly or impliedly require participation (join the volleyball team or you’re fired!)
• Is the activity considered a requirement of your employment?  (i.e. all employees are required to volunteer for habitat for humanity)
• Does the employer derive substantial direct benefit from the activity beyond the intangible value of improvement in employee health and morale. 

As an employer it is great to sponsor sports teams and have company picnics with games to foster team building, but the important thing to remember is to keep participation voluntary.

I was driving to the gym yesterday morning and I was listening to the Brenna and Brenna Law Forum on WHAM 1180.  This is a great show that I enjoy listening to when I’m able to catch it because they field calls from listeners and dispense some really good legal advice.

I was listening yesterday and a listener called in and said that their daughters’ apartment had a fire and she lost all of her belongings and didn’t have renters insurance.  The caller wanted to know if there was anyway that she could sue the landlord to pay for her lost belongings.  Apparently the fire marshal deemed the fire accidental due an electrical wire failure. 

Knowing that the woman didn’t have renters insurance the attorneys indicated that she may be at a loss to get her belongings paid for, but indicated that she could have an engineer inspection to determine the cause of loss or go back to the fire marshal to find out more about the cause of the fire.  The attorney’s believed that if she was able to determine that the fire was caused by the landlord’s negligence or caused by an electrical contractor that performed faulty work she might have the chance of suing the landlord and/or the electrician to have their insurance pay for her damaged belongings. 

Now this is obviously good advice because I’m assuming that the woman was probably out $15,000 or more and that is a big chunk of money.  The only problem is that she could be incurring costs that won’t necessarily guarantee that her belongings will be replaced.  An engineer’s inspection would probably run $200-$500 and who knows how much attorney’s fees would cost, maybe $1,000-$2,000.  She could potentially be out another $2,500 and still not have her belongings replaced. 

She could have saved herself the headache of getting an engineer’s inspection, hiring an attorney and going to court if she just purchased renters insurance in the first place.  Even if she would have purchased the bare minimum policy covering her contents for only $12,000 it would probably have cost her less than $100/year.  It’s crazy to think that she could pay $2,500 to try to have her belongings replaced after the fact, which isn’t guaranteed or just purchased a renters insurance policy for less than $10/month and been guaranteed that her belongings would have been replaced. 

Now obviously hindsight is 20/20, no one ever thinks that they will have a fire in their apartment, so they don’t think that need to insure for it.  That is what insurance is there for, you pay it hoping that you’ll never need it, but if you ever do need it, it’s nice to know that the insurance is there for you. 

I cringe every time a talk to a renter and they say that they don’t have renters’ insurance and don’t want to purchase it.  Especially if they are already paying for auto insurance, they can usually get a multi-policy that can substantially reduce the cost of renters’ insurance.  It can reduce the cost to $60/year or less.  I had one client that it only cost them an additional $3/year to have renter’s insurance after taking into consideration the discount they received on their auto insurance.

I insure a number of contractors and businesses that claim that they don’t have any employees.  They say that anyone that performs work for them is an independent contractor and they report what they pay them at the end of the year on the federal form 1099 for independent contractors. 

Now I know why businesses prefer to pay people as independent contractors because it can be costly to hire someone as an employee.  When you have employees you are subject to pay employment taxes (13.85% above the workers wages earned owed to the government), workers compensation insurance, and NYS statutory short-term disability insurance.  Some businesses hear all of these additional expenses associated with hiring an employee and are quick to classify anyone that performs work for them as an independent contractor. 

Independent contractors are responsible to pay their own self-employment taxes on their annual tax return and carry their own business and disability insurance. 

Most businesses would be in for a rude awakening if they are audited by the IRS.  The IRS may decide to classify that independent contractor as an employee.  If the IRS changes your business’ classification of an independent contractor to an employee you can face stiff penalties and owe back taxes. 

Even if you have a contract that states that the worker is an independent contractor, this is not sufficient to determine the worker’s status.  The IRS is not required to follow a contract stating that the worker is an independent contractor.  How the parties work together determines whether the worker is an employee or an independent contractor. 

There are three characteristics used by the IRS to determine the relationship between businesses and workers:

1. Behavioral control - covers the facts that show whether the business has a right to control how the work is done through instructions, training, or other means.
2. Financial control - covers the facts that show whether the business has a right to direct or control the financial and business aspects of the worker’s job.
3. Type of relationship - relates to how the workers and the business owner perceive their relationship

Behavioral control refers to facts that show whether there is a right to direct or control how the worker does the work.  An employee is generally subject to the business’s instructions about when, where, and how to work.  All of the following are examples of types of instructions about how to do work:

• When and where to do the work
• What tools or equipment to use
• What workers to hire or assist with the work
• Where to purchase supplies and services
• What work must be performed by a specified individual 
• What order or sequence to follow when performing the work

Financial control refers to facts that show whether or not the business has the right to control the economic aspects of the worker’s job.  The financial control factors fall into the categories of:

• Significant investment - an independent contractor often has a significant investment in the equipment he uses in working for someone else.
• Unreimbursed expenses - independent contractors are more likely to have unreimbursed expenses than are employees.
• Opportunity for Profit or loss - having the possibility of incurring a loss indicates that the worker is an independent contractor.
• Services available to the market - an independent contractor is generally free to seek out business opportunities.
• Method of payment - an employee is generally guaranteed a regular wage amount for an hourly, weekly, or other period of time.  An independent contractor is usually paid by a flat fee for the job.

Type of relationship refers to facts that show how the worker and business perceive their relationship to each other.  The factors for the type of relationship between two parties generally fall in the categories of:

• Written contracts
• Employee benefits
• Permanency of relationship - if you hire a worker with the expectation that the relationship will continue indefinitely, rather than for a specific project or period, this is generally considered evidence that the intent was to create an employer-employee relationship.
• Services provided as key activity of the business - for example, if a law firm hires an attorney, it is likely that it will present the attorney’s work as its own and would have the right to control or direct that work.  This would indicate an employer-employee relationship. 

If after reading this summary of employee vs. independent contractor that I summarized from the IRS.gov website, you still aren’t sure how to classify your worker, you can ask for the governments help.  You can file form SS-8 - “Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding”.  This way you can be sure that you won’t be surprised by an IRS audit that changes your classification of independent contractor to employee.