Commercial Property Insurance

EAPs frequently deal with disgruntled employees. It’s a significant part of the job, but the benefit of this activity to the financial world doesn’t get a lot of play in the EAP literature. For many of us, well, it simply sounds too self-serving. This a big problem for many in the EAP field — it’s viewpoint.

Disgruntled employees are often seen as helpless malcontents, troubled, and expendable. Typically, stories in the EAP literature focus too much on how to help these employees be happy, healthy, and productive, while they omit the real story behind the story.

That story is how this helpful activity keeps employers’ financial butts out of the sling. EAPs don’t get the credit because we aren’t talking about it, and it is my argument that we should care a lot more about this side of the equation. Why?

There is a new twist in the 21st century that is leveling the playing field and giving an upper hand to disgruntled employees. It is making the importance of having an effective, proactive, well-in-cultured EAP critical and worth every cent it costs.

That new twist is the social media, especially Web 2.0 sites like YouTube.com. These are free, monstrous, broadcast media outlets that take no prisoners.

An EAP that is visible, known, trusted, and has a real face with it can attract employees who may turn to it with the goal of processing their frustrations, complaints about ethics, anger with supervisors, or tales of abuse and harassment.

Effective EAPs work with two hats in these situations empathizing with the employee, and protecting the company financially by helping the employee get their needs met in effective and appropriate ways.

Absent this level of easily accessible and visibly marketed support for employees, companies place themselves at financial risk. This is especially true if they try to get an EAP on the cheap. For most, this is a direct result of naivety or advice from misguided benefits consulting firms.

Employees who are angry and disgruntled have strong impulses to share their story and vent their frustrations. Starting with an empathic listening ear at the EAP is a better channel than YouTube. It would be better to have an employee’s story end up in the New York Times than on YouTube. YouTube is forever. A classic and recent example follows:

As I write this column, Bank of America has 300,000,000 shares of stock trading (Dec. 8th). But a YouTube.com video posted by a disgruntled employee only a week ago has received over 146,000 views and counting. This growth is the result of word-of-mouth advertising about this video. This is called “viral marketing”. It is a powerful force. To wit, mainstream media, without any qualification or fact-checking, has picked up on the video and is using it for its own economic purposes. I have provided the links below.

Not surprisingly, Bank of America’s stock price has nose-dived in the same week. It has lost millions.

Is Bank of America’s stock price drop the direct result of this video? No one can say for sure. But it is safe to say that it is not helping. And it is more likely that people are looking at this video than press releases about BAC’s financial future.

Do you see an argument for having an effective, humanly visible, and appropriately funded employee assistance program that can act as a stop-gap to helping an organization by dealing with and sincerely helping troubled or disgruntled employees?

Can you see the value in making an EAP a benefit to employees and a loss-prevention, management tool for business organizations?

The latter is under-appreciated and it is continually ignored. This is a direct result of a “reformulated” model of EAPs that has been promoted in the health benefits and managed care literature, and has been accelerated by being unchallenged in an organized way.

From the former supervisor referral of an employee who may soon lose their job over poor job performance, to simply being a program of attraction where employees head for coaching, wisdom, and direction, EAPs have unrecognized and unsung potential to be more vital to corporate America’s financial vitality than we are hearing about or seeing right now.

It is my belief that once the property casualty insurance industry (the real stakeholders) make this connection, that is seeing vibrant EAPs as loss prevention mechanisms, the EAP field will experience explosive growth in a new direction that will result in less violence in the workplace, few disasters like the one below, and of course, more helped employees.

To see the video, go to YouTube.com and Search “Why Bank America Fired Me”.

Media Promotion of This Video

During a life you, your family and your property are exposed to various risks. Illnesses, traumas, fires, hurricanes, thefts – “the Name it a legion…” The best way to secure, the family and the property – insurance.

You have decided to buy an insurance policy. One of the first questions: “What insurance company to choose?” We shall try to help you.

The companies are subdivided into 2 groups:
• LIFE insurance companies, which sell life insurance, annuities and pensions products.
• NON-LIFE, General, or Property/Casualty insurance companies, which sell other types of insurance.

The main reason for the distinction between the two types of company is that life, annuity, and pension business is very long-term in nature coverage for life insurance or a pension can cover risks over many decades.

NON-LIFE insurance companies can be further divided into these sub categories:
• Standard Lines
• Excess Lines.

In the USA, Standard Line insurance companies are “main stream” insurers. These are the companies that typically insure autos, homes or businesses. They use pattern or “cookie-cutter” policies without variation from one person to the next. They usually have lower premiums than excess lines and can sell directly to individuals. They are regulated by state laws that can restrict the amount they can charge for insurance policies.

Excess Line insurance companies (aka Excess and Surplus) typically insure risks not covered by the standard lines market. They are broadly referred as being all insurance placed with non-admitted insurers. Non-admitted insurers are not licensed in the states where the risks are located. These companies have more flexibility and can react faster than standard insurance companies because they are not required to file rates and forms as the “admitted” carriers do. However, they still have substantial regulatory requirements placed upon them. State laws generally require insurance placed with surplus line agents and brokers not to be available through standard licensed insurers.

Insurance companies are generally classified as either mutual or stock companies. Mutual companies are owned by the policyholders, while stockholders (who may or may not own policies) own stock insurance companies.

Are available also Reinsurance companies and Captive insurance companies.

Reinsurance companies are insurance companies that sell policies to other insurance companies, allowing them to reduce their risks and protect themselves from very large losses.

Captive insurance companies may be defined as limited-purpose insurance companies established with the specific objective of financing risks emanating from their parent group or groups.

Legally, the insurance companies can be divided into 9 categories:

1. Domestic.  This type of insurance company is incorporated and formed under the laws of the state in which it is domiciled.
2. Foreign.  This type of insurance company is also domestic company as it is domiciled in one state but it is licensed to do business in another state.
3. Alien.  This type of insurance company is often confused with a Foreign insurance company.
4. Authorized (Admitted) and Unauthorized (Unadmitted).  Upon applying for approval to do business in a state, the insurance company receives a certification of authority from the state Insurance Department (Division).
5. Stock Company.  As the name implies, a stock company is an insurance company that is owned by the shareholders.
6. Mutual Company.  This type of company is owned by the people and/or businesses the company insures.
7. Reciprocal (Assessment) Company.  Nonincorporated associations of individuals or business, called subscribers, engage in cooperative insurance programs.
8. Fraternal Benefit Society.  This type of social organization has bylaws allowing it to sell insurance to its members.
9. Lloyd’s Insurer.  It is a number of people organized into syndicates or groups for the purpose of underwriting risks. Lloyd’s operate on many of the same principles as a stock exchange.

Insurance companies are rated by various agencies such as A. M. Best. The ratings include the company’s financial strength, which measures its ability to pay claims.

The list of the largest insurance companies which are presented in the American market of insurance services, it is possible to see here: http://www.insuus.com/listcomp.htm.

Watch your insurance rates increase perhaps as much as a 96% when your teen graduates the driver training program and gets behind the wheel of your automobile. Yikes! Why?

A spokesman for the Property Casualty Insurers Association of America, Joe Annotti says about teen drivers “The first month, they’re fine, then they think they know everything about driving and safety . . . (and) pretty soon they’re flying 60 mph down a back street to get to school.”

The statistics are not good for crashes and it’s still the #1 killer of kids 15 to 20, and teens under 25 are three times more apt to die in a car crash.

No wonder the car insurance rates jump 50% to 200% the very minute you add your teen driver to your insurance policy. The auto insurance companies are just not willing to handle that risk with out your financial help.

There are a couple things you may want to consider to perhaps reduce the amount your rates will climb before your teen driver takes the wheel.

1. Find out how your insurer assigns drivers to cars. This differs from insurer to insurer and can make a huge difference in the premium you pay. You may want to consider picking up a cheaper car for your teen to drive, such as an old beater that sits in the driveway most of the time. At times this can be less costly than the double or triple insurance premiums on your luxury or new car your teen will drive. Or if you have an older car as well as the new car in the family, see if your auto insurance provider will allow you to assign the teen to the older car, thus reducing your costs. If not, you may want to switch insurance companies.

2. A straight-A student in many instances may not drive better than the C student, but there are many insurers that offer a 10% to 25% discount to teens who maintain a B average or better. Why? These kids are looked at as better future risks. “Long-term, they want the A student as a customer,” Joe Annotti said. Better students are seen as “more responsible.”

3. Have your teen take Drivers Education vs the short-term courses. Short-term courses are not effective in reducing future accidents, according to studies published by the American Journal of Preventive Medicine, but the auto insurance companies will reduce your costs 5% to 15%. Go figure.

4. Raising your deductible should reduce your premium by about 35%. Ron Lovatt of the Automobile Club of Southern California boosted his deductibles from 0 to ,000 when his daughters began driving. It just makes good financial sense to raise the deductible to lower the on-going premiums. It may be the wise idea regardless of teen drivers.

5. If your teen enters college and will not have a car available to them, take them off your policy. However, know your teen will not drive during this time, ever, regardless of who’s car. If they drive uninsured and cause an accident you can be sued.

6. Do not report the fender-benders to your insurance company. If you do report it they will certainly raise your premium. More than likely it will be cheaper to pay for the minor repairs yourself or maybe think about having your teen pay. Ouch!

It should come as no surprise that finding low rates & superior auto insurance coverage comes with knowing something about what the other companies are offering and at what cost. The savvy shopper will find the best rates to meet their needs.