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NC UMBRELLA INSURANCE

NC UMBRELLA INSURANCE

What is Umbrella Insurance?

I am often asked to explain what a personal umbrella insurance policy is.  Put simply, an umbrella insurance policy is an excess policy that covers you where your underlying limits leave off, at whatever umbrella limit you choose.  Umbrella insurance policies give you an extra layer of protection over top of your other personal insurance policies.

This policy is oftentimes purchased as your net worth grows.  In our litigious society today, it is very important to protect your assets.  Many times it is predatory claimants that will come after you once they find out you have something to lose.  Most times though, it is there to protect you against catastrophe situations that may arise, such as major accidents or lawsuits.  

What Types of Policies Will My Umbrella Policy Cover?

Most of your personal insurance policies will be covered under your personal umbrella policy.  An umbrella policy is what is known as a follow-form policy.  A follow-form policy means that if your underlying policy covers you on a claim than your umbrella policy will pick up where that policy left off.  Some common insurance policy types include:

  • Auto Insurance
  • Home Insurance
  • Motorcycle Insurance
  • Boat Insurance
  • RV Insurance
  • Seasonal Home Insurance
  • Rental Property Insurance
  • Personal Watercraft Insurance

How Much Does an Umbrella Policy Cost?

Most umbrella policies are quite affordable.  In fact, they are probably one of least expensive personal lines policies available.  Typically for a household with 2 drivers and 2 vehicles, the premium for an umbrella policy will run around $200 per year or less.  The premium is based on several risk factors.

How is an umbrella premium determined?

Some of the most common rating factors for umbrellas are shown below.

  1. Number household of drivers
  2. Number of household vehicles
  3. Age of household drivers
  4. Driving record of household drivers
  5. Number of residences owned by insured
  6. Number of other owned toys such as motorcycles, boats, RV’s, etc

When Should I Purchase an Umbrella Policy?

The short answer is anytime you have a concern of being sued you should buy an umbrella policy.  We have some clients that purchase these policies when they are very young and have very little net worth.  Others will purchase one as they start to gain some equity in their homes or other assets.  Still others will do this when their kids reach driving age and there is a concern that they might be involved in auto accident that might cause them to be sued. 

There is no perfect answer for everyone.  You have to weigh the costs versus the rewards.  With the cost of the premium being so small, there isn’t a lot holding you back from protecting yourself.  The chance of having an umbrella claim is significantly less than having a claim on your auto and home policy.  However, when you do need to file an umbrella claim, it is typically for a large sum.  There are many cases where uninsured people lose everything if they aren’t adequately covered.  With the benefits outweighing the costs, most people find that $200 per year is worth the peace of mind.

What Liability Limits Should I Have on My Underlying Policies?

While each company can vary on their minimum underlying limit requirements, the most common minimum limits are shown below by policy type.

  1. Auto Insurance- $250,000 Bodily Injury Per Person, $500,000 Bodily Injury Each Accident
  2. Home Insurance- $300,000
  3. Other cycle or boat insurance policies- Either $300,000 Combined Single Limit or $250,000/$500,000 Split Limits

It is important to understand that if you don’t already carry these minimum limits, you would need to increase them to qualify for an umbrella policy.  There will be an increase in premium for the increase in limits as well.  Most times the increase in minimal, depending on what your current limits are.


 

What Else Do I Need To Know About Umbrella Policies?

There are some other important concerns you should be aware of when you have an umbrella policy.

  1. Notify the carrier if anything changes.  This includes new cars, drivers, residences, toys, etc.  It also includes any new major violations.  Most companies will send you a questionnaire at each renewal period to make sure they have the updated information.
  2. Most companies will offer umbrella limits up to $5,000,000.  Ask for quotes on each $1,000,000 layer until you hit your comfort level based on premium.  Find your sweet spot.
  3. Be prepared for higher rates when household drivers are inexperienced or if you have a driver with a DWI or other major violation.
  4. Your personal umbrella policy will only cover personal lines underlying items.  If you have a business and business policies then you should purchase a commercial umbrella policy over those underlying policies.  For info on commercial umbrellas or other commercial policies check out one of our previous blogs on the subject.
  5. Ownership matters.  Make sure all items are owned by the same named insured.  Due to insurable interest, you must make sure all of the underlying policies are also in your name and that the umbrella policy matches that name.  Typically this means placing everything in your name and your spouse’s name.  

We write umbrella policies through multiple companies.  We take all factors into consideration when we shop out these policies.  In some cases it is best to have all policies with the same company.  In others, the rates are much more affordable to spread them out to multiple carriers.  As an independent insurance agency, we put your needs first.  Please give a knowledgeable agent a call at 704-494-9495 for a quote or with any other questions you may have regarding umbrella policies.

 

 

 

RESTAURANT INSURANCE

RESTAURANT INSURANCE

Restaurants have very specific insurance needs compared to that of other types of businesses.  There are varying factors that can be brought into a suit in the event of a claim.  Each restaurant is different and has varying degrees of risk.  We will discuss some of the common claims types and coverage options to protect you if you have a claim.  There are so many different types of restaurants and there is no one size fits all policy for all restaurant types.  

Some common restaurant types

  1. Fast Food
  2. Fine Dining
  3. Food Truck (check out our blog on food truck insurance)
  4. Bar
  5. Night Club
  6. Deli
  7. Brewery
  8. Lunch Counter
  9. Cafe
  10. Bistro
  11. Buffet
  12. Cafeteria

Coverage Types

Restaurants have a large array of needs for insurance.  It is important that you sit down with an insurance professional and discuss all of the liability exposures you may face.  We will discuss some of the more common policy types that restaurants choose to cover themselves with.

General Liability

You should choose a comprehensive general liability policy sometimes referred to as a BOP(Business Owner’s Policy) for your restaurant. You want to make sure you are covered adequately for most perils.  BOP policies offer many endorsements that can be added to your policy to lower the likelihood of an uncovered peril.

Some of the common perils under this policy type include:

  • Customer slip and fall
  • Food spoilage
  • Advertising liability claim
  • Food poisoning illness

Crime Insurance

Any acts of dishonesty by one of your employees are covered under a crime policy.  In many cases, this can be added as an endorsement under your general liability policy.  These policies will pay out for losses you have incurred due to some of the following types of crime insurance.
  • Theft of money or securities
  • Employee dishonesty
  • Forgery
  • Funds transfer fraud
  • Computer fraud
  • Counterfeit money

Liquor Liability

If your restaurant sells alcohol of any kind, you need to have a liquor liability policy in force.  Your general liability policy will exclude this type of loss.  If a suit comes back in any way against an over-served patron it will also likely fall back on your establishment.  Remember, your employee doesn’t even need to be negligent for you to get sued.  A liquor liability policy will pay the costs to defend you as well.  Discounts are often available if you have completed training with your staff on reading the signs of an inebriated customer.  We recommend taking classes for this outside of just the discount offered.

Property Insurance

Restaurants have quite a bit of business property that would need to be insured.  

Some common types of property in a restaurant include:

  • Building
  • Interior additions and alterations
  • Furniture
  • Computer equipment
  • Inventory
  • Kitchen equipment
  • Miscellaneous equipment 
  • Signs
You should do a personal inventory of the items that would need to be replaced in the event of a loss, say a fire.
Even if you don’t own the building you operate out of, you still want to be covered for any interior permanently attached equipment.  You may have sank quite a bit of money into what they call improvements that would need to be insured to put you back where you were before the loss.

Workers Compensation

 
Claims for workers compensation are not uncommon in this industry.  Slips and falls are common, as are kitchen accidents.  In NC, a business with 3 or more employees, including the owner, is required by law to carry workers compensation insurance.  Workers compensation pays out not only for the medical bills of an injured employee, but it also covers any lost time at work.  These expenses can get quite expensive and with the likelihood of a claim, workers compensation is essential.

Commercial Auto Liability

Many restaurants do outside catering and have a need for commercial auto insurance.  This policy will cover any liability that results while a vehicle is being used for business use.  Damage to the vehicle will also be covered if physical damage is chosen as well.  In some cases, where an employee’s vehicle is being used instead of a restaurant owned vehicle, a non-owned auto endorsement would need to be added to the policy to cover that specific vehicle.  
 

Business Income

Business income is insurance that covers you for lost income due to a covered peril.  If you had a fire and had to close your doors for several weeks or months to complete the repairs, could you withstand the loss of income?  Your expenses such as salaries, rent, and taxes will still need to be paid even if you lose all of your income.  A business income policy will assist in keeping you afloat during this time.

Cyber Liability

Cyber liability if one of the fastest growing insurance types.  You will be handling customers payment info and if that were to get into the wrong hands it can be very expensive if a claim were to arise.  For a more detailed listing of what is covered in cyber liability please view my blog from a couple of months ago on the subject.

Commercial Umbrella

You can also purchase a blanket umbrella liability insurance policy that will kick in and pay up to the limit of your choosing once the underlying limits for policies listed above are exhausted.  Your commercial umbrella carrier will want to be made aware of any policies under the umbrella that will be covered.  You will also have to meet the minimum underlying limits on those policies to meet the umbrella policy requirements.
You can see that restaurant insurance can be quite complicated with various types available.  It is important to discuss your specific needs with an insurance expert in this industry.  Please feel free to call us at 704-494-9495 and discuss any questions you may have with an agent specialized in restaurant insurance.
Food Truck Insurance

Food Truck Insurance

One type of insurance that has grown significantly over the last decade is for food truck businesses.  If you run a food truck in NC or are thinking about starting up a business in the industry, then you will have several insurance policy coverages to consider.  
We have various carriers that specialize in these policy types and we can offer the most competitive rates in the market.  We will discuss some of the most common policy types that you will want to protect you and allow you to complete contracts.

Auto Liability

Auto liability on a food truck is similar to a personal auto insurance policy and it will pay out in situations where you are involved in an incident while driving your food truck.  If you hit a vehicle, person, or other object, your auto liability policy will pay for the bodily injury or property damage of the injured party.  You can also include comprehensive and collision coverage, medical payments, etc along with your auto liability policy as you would your personal auto policy.  
Auto liability limits chosen maybe be split limits like $100,000/300,000/50,000 or combined single limits of $1,000,000.  The limits you choose will want to meet your minimum threshold to protect yourself and the limits being required by a contract.

General Liability

A general liability policy will pay out for losses outside of negligence while driving your vehicle.  This could include claims of illness from the food that you serve or an individual being injured around your truck. 
Typical limits for a general liability are $1,000,000 per occurrence.  This is a common requirement if you plan to sell food in a public place.

Business Personal Property

Any business property that you use to serve, prepare, and deliver food should also be covered if you want protection for losses from fire, theft, or other losses.  Your auto liability will likely have a cap on any of these items, even if they are permanently attached to the vehicle.  Business personal property can included grills, coolers, products, and cash registers.

Workers Compensation

If you hire employees in your business, then you will also want to make sure that you have a worker compensation policy in effect.  If your employees are injured in a workplace accident you can be sued not only for their injuries, but for their lost time at work.
There are laws in place that require workers comp coverage for your employees.  In NC the minimum required limits for workers compensation is $100,000 each employee, $100,000 each accident, and $500,000 for the policy limit.  You can increase these limits up to $1,000,000 for a nominal price increase.

Liquor Liability

If you serve alcohol, you will want to carry a liquor liability policy.  These policies payout on claims that result from injuries caused by intoxicated patrons served by your establishment.
Aside from protecting yourself from catastrophic claims and being sued for losses, you will likely encounter a need for insurance due to contract requirements.  NC counties, especially Mecklenburg County, have stringent insurance requirements for food trucks and vendors.  In order to meet their requirements, you will need to prove that you have the minimum requirements by presenting an insurance certificate.  It is not uncommon to see  requests for insurance from other entities like building owners, landlords, restaurants, and festivals.

Some final thoughts on compiling food truck insurance quotes.

It is important to understand that you don’t need to combine all policy coverage types under one policy or carrier.  In some cases, bundling these coverages under one policy can be beneficial.  In others, it can cost you more.  You have to understand that sometimes insurance companies may offer you a lower rate on one coverage type, say auto liability, but make up for it by charging a higher premium on another policy type, say collision.
It is best to let an experienced insurance agent peruse all of the companies at hand and possibly piecemeal these coverages together if it makes more financial sense for you.  
Also, it is best to be prepared and present the needed information when getting quotes so you won’t have to go back and forth with the agent.
Below are some of the questions you may be asked when requesting quotes.  
  • Vehicle info including VIN numbers
  • Driver info including date of births and license numbers
  • Total annual sales
  • Total annual payroll
  • Liability limits 
  • Specific contract requirements
  • Mailing and garaging address

Please let us know if you have any other questions regarding insurance for food trucks and trailers.  Our expert agents are here to help.

CONTRACT SURETY BONDS

CONTRACT SURETY BONDS

A contract bond is a type of surety bond that helps guarantee that the terms of a contract are met.  If a contractor does not adhere to the terms of the contract than the injured party can collect any financial losses incurred from the bonding company.  It is an additional safeguard to ensure the principal performs all items in a written contract.
A contract bond is often times synonymous with the following terms:
  • Contractor Bond
  • Construction Bond
  • Bid Performance Bond
  • Bid Bond
  • Proposal Bond
  • Payment Bonds
The two common types of contract bonds are bid bonds and performance or payment bonds.
Bid Bonds specifically protect the obligee from the Principal either backing off of the stated bid that has been accepted or submitting a low-ball bid and then not honoring the agreed upon price.  Bid bonds are typically issued between 5-10% of the overall bid.
Performance Bonds will protect the obligee in areas of the contract like completing a job when agreed upon and under the agreed upon items.  It guarantees that the contractor will perform the contract and pay for the labor and materials needed to complete the project.  Payment bonds are typically issued at 100% of the contract amount.
A surety bond is an agreement that involves three of the following parties:
  1. The Principal– The party purchasing the bond that is being required to fulfill the terms of the agreement.
  2. The Obligee– The party that is usually requiring the bond and is reimbursed for financial losses due to the principal’s failure to fulfill the duties of the contract.
  3. The Surety– The party that is responsible for paying out the financial losses of the obligee due to the prinicipal’s failure to fulfill the duties of the contract. 
Contract bonds are usually only required on larger projects by large builders or subcontractors.  It is a way to easily recover from financial burdens without having to enter into costly lawsuits against the contractor.  Typically any public project over $100,000 will require a a contract bond.
A list of common business types that will be required to have these bonds are:
  • Concrete construction
  • Electricians
  • General contractors
  • HVAC contractors
  • Painters
  • Roofers
  • Plumbers
Due to the nature of these bonds and high possible payouts, most companies will run a credit score on the principal before agreeing to issue a bond.  In addition to this, some companies may require the following other items to consider a risk.
  • Financial statements for the business
  • Personal financial statement for the owner
  • Resume of owner
  • Certificates of insurance on other commercial policies the principal may have
  • Questionnaire
  • Bank letter of reference
  • Job reference letters
  • Schedule of current projects on hand
Our agency writes through various bonding companies, as we do insurance companies.  Preferred risks will see the best pricing in the industry with a couple of our carriers, but we also have other markets that may not be considered by the preferred companies for one reason or another.  Please call us at 704-494-9495 for any questions you may have on this surety bond type or to get a quote today.
NC CYBER INSURANCE

NC CYBER INSURANCE

Cyber liability insurance is one of the fastest growing insurance policies that NC small businesses are looking to protect themselves with.  Because it is such a new policy type, there are several questions on what it is and what it covers.  We will discuss exactly those things in this article so that you can make an educated decision if this policy is right for your North Carolina small business.

 

Everyone knows how much cyber is a growing concern, but it might surprise some businesses just how common it is.  It is far from being a concern for only large corporations too.  In fact 60% of cyber crimes are against small businesses.  60% of those businesses that are victims of these attacks go out of business within 6 months of the attack.  The costs are staggering when they do occur and those without cyber insurance are left with 100% of those costs.
Are you exposed to the possibility of this happening to your business?

If your company has/does have any of the following, then the answer is a resounding yes. 

  • Company Website
  • Social Media Accounts (Facebook, Twitter, Instagram, Linked In)
  • Accept Credit Cards
  • Uses Online Banking
  • Store Customer Data (Name, Address, Date of Birth, License Numbers, Credit Card Info, Social Security Numbers)
If you realize that you could be at risk, but are still confused on what types of things could happen to you, then you are not alone.  It can be very complicated.  We will discuss and clear up some of those common claim types below and explain the ways that a cyber policy will help cover those things.

SOCIAL ENGINEERING

Social engineering is a predatory type of cyber crime where an employee is tricked into sending or uploading money to someone through false pretenses.
Cyber insurance will cover those lost funds from these types of schemes.

RANSOMWARE

This is a virus sent as a link in an e-mail.  Once an employee clicks the link, the virus immediately begins to to encrypt computer files.  The imposter will then demand funds in order to recover the company’s files.  Typically bit coins will be demanded.
The cyber liability policy will cover the cost of the ransom in order to have your files recovered.

DATA BREACH

This type of attack gains the most media attention.  Large organizations like Sony, Target, and Equifax have recently been in the news for being hacked.  These losses occur when a cyber criminal breaches a company network and gains access to customer data.
Cyber policies will typically cover the following:
1. Fines by regulatory commissions and other penalties
2. Legal fees toward lawsuits from customers
3. Security expert assessments
4. Public relations firm services
5. Customer notification costs for those effected by the breach

MEDIA LIABILITY

Covers defamation or slander by an employee about a customer on social medial accounts causing a lawsuit.
Cyber insurance will cover defense in a lawsuit against your company.

FUNDS TRANSFER FRAUD

Hackers gain access to your system and transfer company funds to their account.
Your cyber policy will cover any losses incurred, not covered by your bank for fraudulent transfers.

NETWORK SECURITY

Your company site gets hacked making your system inoperable and not allowing customers access to their information.
Cyber insurance will cover lawsuits by customers for not being able to access their account.
One final myth we would like to dispel regarding cyber liability insurance, and that is that the premiums are too expensive for a small business. We write through some of the leading insurance companies in the industry, with the most competitive premiums.  Premiums start as low as $800 per year depending on the business type, size, and exposure.
Please call us at 704-494-9495 with any questions, or if you would like a quote on this valuable insurance policy today.