http://www.roughnotes.com/benefitsereport/archives/v18_february2012/page34/page34.htm

Want to get paid?  Want to get on the job?  Want to get a certificate of insurance? Even worse, do you want to get a certificate of insurance that names a third party as an additional insured?

This world has changed.  In order to provide certificates of insurance that include individuals or third party organizations as additional insureds, a written contract is required.  Some insurance policy language goes further-requiring both a written and executed contract.  Other requirements such as Waivers of Subrogation, Primary and Non-Contributory language must also be required in a contract in order for a broker to provide a certificate of insurance indicating compliance.

Ten years ago the requirements of a contractual relationship requiring additional insureds, etc. did not need to be met.  Today they do!!  The state Insurance Departments have specific regulations and requirements stating that no coverages can be amended through a certificate of insurance without endorsement to your insurance policies or being in compliance with contractual regulations of the insurance policy. 

 This puts a real burden on the issuance of a certificate of insurance in a timely manner.

Your EC&S team wants you to get paid or start a job on your schedule. Please provide a copy of the contract to your Early, Cassidy, and Schilling, Inc. representative when ordering your certificates of insurance so that we can deliver them efficiently and when you need them.  

Written by: Tim Schilling

Surety bonds, a proven method of risk transfer are frequently used to mitigate the downside risk of loss.  We have seen  increased requests for  a performance bond  being incorporated into RFP’s  because contractors are requiring bonds from large suppliers and the public sector is  protecting their taxpayers from contract default when it outsources a service.

 Is your business in need a bond for the first time?  If so, you are probably asking “What do I do now?” Early, Cassidy and Schilling, Inc. has the solution for you.  Just contact the bond department today.

Written by: Lynne Cook

1. Do not share PIN numbers or your credit card or your debit card with anyone.
2. Download your bank’s mobile apps so that you can be sure you are connecting to your bank and not fake site to avoid phishing.  
3. Download regular updates whenever they are available.  
4. Inform the bank immediately of any lost card or mobile or registration number.  
5. Do not use public wi fi when banking and make sure you are connecting to the bank via a secure connection.  Disable the automatic wi fi connect option in the network settings of your mobile service. 
6. Banks never ask for details through SMS’s or calls.  Avoid messages and calls. 
7. Password protect your mobile phone for extra security. 
8. Install an anti-theft app that wipes down the device so that no information can be accessed in case it is lost or stolen.  Know how to kill or wipe your phone remotely.

Written by: Tim Schilling

1. Crisis Services which can include forensics (problem diagnosis and repair), notification, credit monitoring, and legal counsel. To get an illustration of the potential impact on your firm, copy this link and go to this address: http://databreachcalculator.com.sapin.arvixe.com/
2. Business interruption costs
3. Public Relations costs to mitigate adverse media attention and related expenses to preserve favorable relationships with customers.
Another unfortunate truth is that a great burden is placed on business for compliance through a myriad of regulations. Based on the Health and Human Services website , there are roughly 46 laws and/or regulations regarding Confidentiality, Privacy and Data Security. While the leading acts are HIPAA, GLBA 501b (Graham-Leach- Bliley), HITECH (Health Information Technology for Economic and Clinical Health) and ERISA, there are many other federal regulations that can trigger fines or penalties. In addition, any business processing credit card transactions is also subject to Payment Card Industry (PCI) standards. Individual payment brands (e.g. Master Card, Visa) can and do impose fines and operational consequences on their retailers.
Don’t wait. Contact Early, Cassidy & Schilling, Inc. and let us help you asses the potential impact to your business. We will help you minimize your cyber risk by identifying control methodologies and transferring risk through insurance.

Written by Michael Fragola, VP Business Development, Early, Cassidy & Schilling, Inc.

No Payment Protection

Since a mechanics lien cannot be placed on public contracts, the use of payment bonds has been the standard protection for subcontractors and suppliers. With the new regulation, you as a subcontractor do not have any payment protection on a public non- transportation contract of $500,000 or less.

Prequalification Changes

The regulation suggests a new prequalification process in lieu of a bid bond for contracts in excess of $100,000 and under $500,000. When you, as a sub, take a job that is bonded, a third party is offering assurances to the owner and all parties involved that the general contractor is capable of prosecuting the contract. This is because the surety has performed a rigorous prequalification process from both the financial and operational perspectives. In addition, sureties maintain long-term relationships with a contractor which affords them an understanding of their client’s performance capabilities over a period of time on both public and private work. The new regulation imposes the prequalification process on to the public contracting authority.

This impacts you in at least two ways. First, will the new publicly managed process be as effective as the corporate surety regimen? Is the general contractor truly qualified to perform the work and pay the bills? Second, if you bid as a prime subcontractor, be prepared to participate in the state’s prequalification process which will probably include providing financial statements to them.

Taxpayer’s Risk

Historically, bid, performance and payment bonds have been the utilized for over eighty years by governmental bodies to transfer the risk of non performance from the taxpayer to the surety. Without the surety, the risk of default falls back to you, as a taxpayer, if your business or you reside in Virginia.

During the 2011 legislative session, the Senate reviewed S.B. 1126 which suggested increasing the threshold on transportation contracts from its current $250,000 level. This bill created a panel of interested parties to study the performance and payment requirements and report its findings to the Senate in December of this year.

Please watch for further developments.

Written by: Lynne W. Cook, Senior Vice President

Many construction companies form joint ventures with another contractor for the purpose of performing a major project. In order for the JV to be covered on the existing construction company’s General Liability policy (CGL), the JV must be added as a named insured. Some contractors prefer to purchase a separate CGL policy specifically for the JV entity.

Unfortunately many times clients forget or do not realize they need to notify their insurance agent about the new entity. EC&S has a solution: add a blanket joint venture coverage endorsement to the existing CGL policy. This will also eliminate the need for a second policy and assure NO GAPS in coverage will occur.

In case the exposure of completed operations is on your mind, there may be an endorsement available that will include liability coverage for the joint venture following completion of the project.

Members of the EC&S Construction Team are prepared to draft manuscript endorsements and request coverage from your CGL insurer.

As 2011 fast approaches, it will soon be time to close out your OSHA Injury & Illness logs for 2010.  Just a reminder that the Form 300A must be certified by a company executive and posted by February 1 and remain posted until April 30 each year.  Similar to the Department of Labor posters, the Form 300A should be posted in a location where notices are customarily posted for all of your employees.

If you are unsure about the recordkeeping requirements for your business, OSHA provides a list of exempt industries on its website at http://www.osha.gov/recordkeeping/ppt1/RK1exempttable.html.

For more information, interpretations, and the forms needed to meet the recordkeeping requirements, visit http://www.osha.gov/recordkeeping/index.html.

As always, please feel free to contact us for guidance on this or other OSHA compliance concerns.

Small and mid-size companies seeking an alternative method of risk transfer but lacking the financial capacity to form their own captive and unwilling to pool their premiums and losses with others in a group captive might consider a third option – “rent a captive”.  This increasingly popular vehicle allows firms to realize the benefits of a captive insurance arrangement without participating in the ownership or management of the facility.  It has become the ideal first step for those entering the alternative market.

Unrelated insureds can access a rent-a-captive with much lower entry and operating costs and shorter set-up time in either domestic or offshore domiciles.  A further refinement of the rent-a-captive is the protected cell company (PCC), which provides legal separation of the assets and liabilities of each insured’s account, or “cell”, from those of every other insured.  Each cell is shielded from sharing capital or surplus with other cells and from legal action against another cell.  A PCC, similar to a corporation, protects the business owners’ personal assets from claims arising from their business operations.

Effective 1/1/11 if you have a flexible spending account, or plan to sign up for one, over the counter medications are no longer reimbursable expenses, unless they are prescribed by a doctor.    A OTC prescription  is defined as a “written or electronic order for a medicine or drug that meets the legal requirements of a prescription in the state in which a medical expense is incurred and that is issued by an individual who is legally authorized to issue a prescription in that state.” This new rule was implemented due to the health care reform act.  In notice 2010-59, Guidance on Changes to Rules for Reimbursement of Over-the counter drug expenses.