Cyber Liability; The Risk That Evolves Daily

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How Cyber Liability threatens your business every day

Did you know that an average business has a greater chance of having a cyber breach than it does of having a fire? It is true, and your business insurance policy most likely will not cover cyber liability losses.

Technology has enabled the common criminal to get into the world of cyber crime. Small businesses are a prime target, as most small businesses have little to no protection. Criminals can actually purchase programs that can be set up to hack dozens of businesses at the same time. It is important that your business has the right business insurance, including cyber liability insurance. Here are a few of the evolving cyber threats.

Malware hacks

These are programs that can be attached to an email or web site. The malware then can target specific systems.

Example–A small retail shop owner opened an email with a malware attached. The hack program then found 1,500 credit card numbers of the shop’s customers. The shop did not know about the hack until customers called about the fraudulent charges. The shop owner incurred over $75,000 in notification and payment expenses.

Social Hackers

This scam involves someone posing as a trusted bank or other advisor. The criminal then relies on the business owner or manager believing the call is legitimate and divulging privileged information.

Example–A CFO received a call from a hacker (acting as a bank official) requesting verification of account information. Through the process, the hacker obtained privileged information. They then used this information together with other data to make withdrawals from company accounts.

Key Business Insurance Coverage Offers Real Solutions

  • Cyber liability
  • Data restoration coverage
  • Business income or loss income
  • Legal notification coverage and expense

 

Why Hand The Baton To An Agent?

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baton 3432drtLife can be like a race. We all are in our lanes going as fast as we can to get to the next place. Buying insurance can also be like a race.  Except with insurance, you have the option of passing the baton to an independent agent, and when the baton is passed correctly, you and your agent truly become a team that can accomplish great things.

What are some of the benefits of passing the baton to an independent agent?

  1. An independent agent is someone who knows how to run in the insurance fast lane. With an independent agent, you will be able to communicate more effectively with insurance companies, than you can on your own. This gives you an advantage of having an advocate on your team.  We know which markets are interested in your unique insurance requirements.  For example, some markets like contractors while others prefer retail businesses.  And still other markets like to insure motorcycles.
  2. When you pass the baton to an agent, you now have the experience and clout of a well trained professional to finish the race for you. The finish line includes having the insurance relationship and program design that meets your individual needs.
  3. When an agent takes the baton, you get his or her entire team as well. This includes qualified staff to help answer your questions and provide accurate information to you when you need it.
  4. Every race may have a point where claims do happen. If your agent has the baton they will be there to help you get back on your feet and get you back in the race. An agent will take the lead in working with the insurance company during the claims process.
  5. As your team member, we communicate with you. Our goal is to connect with you regularly throughout the year on hot topics that will affect you.

Together we will run the race with professionalism, excitement, experience, and customer service in mind, to deliver the best possible combination of coverage, service, and price.

What Does Outstanding Customer Service Look Like?

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Have you left a business and thought, “How are they even in business”? Or have you gotten off the phone and said, “They don’t understand or care about my needs or even respect me”?  We have had those experiences, and we don’t ever want any of our customers to feel that way about our firm.

Outstanding customer service can mean something different to each person. However, we believe there is a basic underlying attitude of a firm that provides outstanding customer service. We would like to share our thoughts on what our firm believes contributes to outstanding customer service. Outstanding customer service is a mindset that we want every employee to have.

We practice three basic principles when relating to clients: empathy, appreciation and helpfulness.

  • Empathy – We will consider and understand your opinion and needs. We will educate you on the details of insurance so that you can make an informed decision.
  • Appreciation – You are important to us and you should be told so. We will value our relationship with you and treat you with respect and trust.
  • Helpfulness- When you call our agency you will talk to a licensed professional who lives and works in the community. We will listen to your requests and provide thoughtful responses. We will always say thank you. We know you have choices when it comes to selecting your insurance agent, and we appreciate that you have chosen us.

Here are other guiding principles that every agency should live by

  • Do what you say you are going to do. If you say the certificate will be delivered by 10:00 am Tuesday; deliver it before or on time.
  • Own your mistakes. No agency is perfect, so when a mistake is made, take responsibility and identify corrective measures to prevent it from happening again.
  • Care about the customer. Genuinely care about your customers and their experiences. When a loss occurs we will get involved as if the loss happened to us.

Insurance is not a product. It is a promise and a trusted relationship. Here at Reichley Insurance Agency, we are not going to sell you something you don’t need. We want to talk to you, determine your needs, and get you covered at the right price.

 

 

 

 

 

Five Things to Do Before You Start Your New Business

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The latest news from the Small Business Administration is that only 60% of new businesses survive at least 2 years. Of that 60%, only 44% survive another two years. It is a fact that more small businesses fail then succeed. The two main reasons for failure are lack of planning and funding. While we can’t help with the funding part, we can offer some ideas about new business planning.

We found at least five things entrepreneurs should consider as part of their development process. We understand there are more, but this is a good start.

  1. Understand the risks and legal issues – It is important to any new start up to understand all the legal and regulatory statutes and laws surrounding their business. Hire a good attorney to help you; it will be worth the expense. Hire a professional insurance agent to help you understand what your risks are, how to manage the risks, and how to protect yourself from the risks.
  1. Start with a good name – Your name needs to tell the story of what your firm does. For example, if you are starting a bakery, the name “Smith Brothers” fails to tell the public what you do. Also, depending on your market, it is probably not a good idea to use a foreign language as part of your name. Keep your name simple but innovative.
  1. Develop a marketing plan
    1. Who is your target market?
    2. What is the current competition?
    3. How can you fill a need?
    4. What strategies do you need to undertake to tell your story?
    5. What are the costs of doing business?
  1. Develop a Web strategy– It doesn’t matter what business you are in, you must develop a web presence. This would include a web page, social media (Facebook & LinkedIn) and a blog. For some industries, Twitter and Pinterest are important as well.
  1. Seek out mentors and advisors– Whether your mentor provides pointers on business strategy, helps you bolster your networking efforts, or acts as a confidant, it is good to have someone on your team. Hire a competent attorney, insurance agent, accountant and payroll HR/firm

Insurance is not a product. It is a promise and a trusted relationship. Here at Reichley Insurance Agency, we are not going to sell you something you don’t need. We want to talk to you, determine your needs, and get you covered at the right price.

Good luck and call us with any questions so we can help you achieve your goals!

Insurance & Risk Best Practices

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What Large Companies Do To Lower Costs That Any Company Can Do

As we continue on our journey to a better understanding of insurance, we thought it would be informative to identify some risk management “best practices” of larger companies. We believe that many of these “best practices” can, and should, be discussed with businesses of all sizes.

The good news is that these generally don’t create additional costs to the company; in fact, they usually reduce costs!

Insurance & Risk Best Practices

  1. Big Companies View Their Broker/Agent As A Trusted Advisor. The best way to accomplish this is to not bid insurance, but rather select an agent based on qualifications and the best fit with the goals of the business.
  2. Consider Modifying The Insurance Program With The Swings In The “Market”. For example, during a soft market you are able to lower deductibles and broaden coverage. As the market cycles up, you are able the increase deductibles to offset premium increases.
  3. Develop Cyber Breach Procedures. Small to medium sized businesses have a greater chance of having a cyber-breach than they do of having a fire. Here is an excellent resource from Experian
  4. Wellness Has Become A Norm. According to an article in the Louis Business Journal, “employee absenteeism is reduced when wellness programs are implemented”. In a study by Prudential Insurance, disability days were 20 percent lower and disability-per-capita costs were 32 percent lower, after implementing a wellness program. In addition, annual medical costs fell by 46 percent.
  5. Human Resources Is Part Of The Management Team.As the workforce gets older, finding ways to attract younger employees will be important. Developing new nontraditional compensation formulas and work hour flexibility will help attract and retain top performers. Develop an employee handbook and keep it updated. Educate and train all employees.
  6. Separation of Accounting Duties. A recent report issued by The Association of Certified Fraud Examiners, places the cost of employee fraud at 7% of annual revenues. Companies with less than 50 employees saw a median loss of $50,000. Separate check writing and depositing responsibilities, and have an annual audit by a qualified firm.

At Reichley Insurance, our employees are committed to developing ongoing communication with our clients and striving to exceed your expectations. You are not buying a product; you are managing your risk. Remember, insurance is not a product; it’s a promise and a trusted relationship.

Cost of Risk Part Two

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“Total Cost of Risk” is the sum of the costs arising from all classes of risk faced by an organization. Insurance is one component of a risk management strategic plan that protects your assets. There are many benefits to this new approach.

Benefits of a total cost of risk approach

  • Making effective risk management decisions.
  • Measuring progress toward risk management objectives.
  • Understanding that insurance is only a piece of the puzzle, not the entire puzzle.

Total Cost of Risk

  • Internal Risk Administration- This is the cost associated with managing your insurance program. For example, if you have to spend more time getting basic insurance issues answered, your cost of risk goes up.
  • Legal and Claims Expenses- These are costs associated with claims. If your agent is not willing to step in and help, you will spend more time managing the process.
  • Deductible Costs- Every policy has certain deductibles. These are direct costs. It is always important to check quotes to make sure deductible are consistent. Lower premiums may turn into higher costs if the deductibles are higher.
  • Uninsured Loss Costs- Policies do have exclusions and will impact your costs. For example, if you operate a restaurant, your policy better have food spoilage coverage. Knowing the risks of your industry can actually reduce overall cost.
  • Safety Program Costs- Safety programs do have a cost. Some are paid internally and some can be supported by the insurance company.
  • Insurance Premiums- These are direct insurance costs.
  • Contracted Costs- You may enter into contracts for services, and having the right language can improve overall costs. For example, if you are remodeling your building and don’t require the contractor to have insurance, you may be responsible for his injured employees or more. This will increase your risk costs.

The key is there are ways to lower costs in each of these areas that don’t have anything to do with insurance. Having a trusted advisor who can help you evaluate this will serve you well in the long run.

A New Way to Think About Insurance

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Congratulations! You got past the title and are now embarking on a new way to look at the insurance buying process. Over the next few months we would like to offer you an alternative way to think about insurance that will change your purchasing experience.

We will start with a few basic truths that we believe in. We will share these truths in greater detail over the next few articles.

  • Insurance is a service not a commodity.
  • You can never get the right insurance for you needs online in 7 minutes.
  • There is more to insurance than a policy.
  • Insurance was designed to be a relationship between the customer, agents and insurer.
  • Your insurance agent should be as valuable as your CPA, attorney and financial advisor.
  • If all you get from your agent/company is a policy, then they are overpaid.
  • Insurance ads are confusing because they make you believe that all insurance is the same, and we all know that not to the case.
  • To get proper coverage, a knowledgeable agent and great service, buyers need not pay any more.

The very core of what we value is that providing reasonable solutions to people and businesses should come before everything else, even if what we recommend means not selling you insurance. That is what we will do.

We want to inform you about the value and importance of developing a relationship with your agent. The qualification of the agent can make a difference in your insurance coverage.   The national companies spend millions of dollars in advertising while offering only a minimal amount of coverage. The main purpose of insurance is to have your claims covered. In order for your claims to be covered you need an individualized policy that addresses your risk and needs. Only then, will you have the right coverage.

We hope you will join us on this journey, and in the end decide that there is a better way to buy insurance and have true peace of mind.