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Hiring in California: How to Reduce Your Risk

Hiring new employers can be risky for company culture and the bottom line. 

Since new employees are hard to come by, sometimes the decision to hire is rushed and there can be increased risks involved with the hiring process. 

Even Brenda Jo Robyn, founder of Competitive Edge Insurance, screens employees pre-hire on Motor Vehicle Records (MVRs). This checks if they have a clean record and can they legally drive for your company, which ultimately will help with company rates. 

Screening Employees

Who you work with matters.

On one hand, creating a positive company culture will benefit your employees and overall employee retention, which reduces financial and social risk. One way to create this company culture concerns how you screen potential employees in order to avoid a toxic environment. 

A DMV screen costs 60 dollars and has proved to be worth the extra step. This DMV screen includes a general background check and driver’s license check. 

It’s important to require DMV screens every year. This can save your company a lot of time and money in the long run by retaining the right employees. 

Lastly, if your employee is driving on company time, it is important to make sure that the employee has their own car insurance.

Intellectual Property

In California, your client list can be considered intellectual property. In each employee offer letter, however, it’s crucial to have a separate section outlining that all clients will stay connected with the company if they were to leave. 

If you have failed to do so already, you might consider reaching out to current employees and stating the new company policy. 

Physical Space

The separation of class (for example, warehouse space vs. office space) for employees might take a couple of extra steps as a business owner but will reduce risk when hiring new employees. The separation between the physical warehouse and office space is the main separation to be considered as a business owner.

There are regulations for how the space is separated. For example, for some, areas being separated by chain link is considered acceptable. 

Invest in EPLI

The Employer’s Professional Liability, also known as EPLI, causes different claims to arise from employees. There are a few ways to protect your business from a flood of EPLI claims. Employee lawsuits are rising and in return, settlements are becoming even more expensive. Although there are different types of insurance, workers’ compensation and EPLI are both ways to reduce risk with employee benefit plans. 

EPLI is crucial to invest in as a company if it comes to a disgruntled employee—even if you are a small business. In the chance that your company gets sued, your EPLI insurance will cover it.

High-Risk Coverage

High-risk insurance addresses companies whose coverage was either terminated because of a claim, those who are new and cannot get coverage because of industry risk, or those who have experienced drops in revenue or industry disruption such that carriers are broadly refusing coverage. 

You might be wondering, what risk class am I in? Luckily, there are various ways to determine this subgroup:

“An insurance risk class is a way for insurers to underwrite policies based on one’s belonging to a particular risk group.

People in each risk group will generally share similar characteristics that help insurers better estimate the chances that the policyholder will file a claim

Riskier risk groups will pay higher premiums—for example, people who are sick, older, or have a poor driving record.” 

As a business owner, it is important to put the gates, systems, and processes in place to protect yourself, and Competitive Edge is here to help! 

We follow the practices we write about because we believe in the importance of preventative risk. For those who are interested in reading more about what classifies as high risk, read on.

What Classifies High Risk?

At Competitive Edge, we specialize in high-risk insurance. We often get the question, “What is high-risk insurance, and how do I know if I need it?”

Well, the answer is, if you’re a small business owner, general contractor, or even car owner, you likely need high-risk insurance. Depending on the industry you’re in, however, it can be difficult to fund coverage or losses. 

There are a couple of ways to identify what classifies high-risk insurance. 

Risk Class

Investopedia defines risk class as, “A group of individuals or companies that have similar characteristics, which are used to determine the risk associated with underwriting a new policy and the premium that should be charged for coverage.” 

There are some main points that are needed to understand the risk that is associated with coverage: 

  • “An insurance risk class is a way for insurers to underwrite policies based on one’s belonging to a particular risk group.
  • People in each risk group will generally share similar characteristics that help insurers better estimate the chances that the policyholder will file a claim
  • Riskier risk groups will pay higher premiums—for example, people who are sick, older, or have a poor driving record.” 

Once you determine if you qualify for high-risk insurance, there are additional factors that will determine your premium. These might include: 

  • Age
  • Amount of coverage
  • Number of years the coverage is guaranteed
  • Risk class
  • And more!

Additional Classifications

One example of a scenario of hard-to-place insurance is from our very own founder, Brenda Jo Robyn of Competitive Edge Insurance. Brenda Jo had to pay an extra $15,000 in order to get her directors on board for her project.

If you have had excessive losses, shock loss, or are a startup (tech and service), it can be challenging to get professional liability coverage. There are, in fact, some extreme costs associated with high-risk coverage.

So, even the professionals have dealt with the difficulties and hoops that surround high-risk insurance (trust us, we get how frustrating it can be to navigate). That’s also why we’re here to help! 

Contact Us Today! 

Competitive Edge Insurance can help you perform a comprehensive review of all your risk exposure. 

Reach out today for more information from our experts on high-risk insurance! 

BEWARE: Workers’ Comp Insurance for Independent Contractors

As you may know, most states require employers to have workers’ compensation insurance. These insurance policies can help recover most of your employee’s lost wages while they recover from a work-related injury or illness.

It also helps to cover your employee’s medical expenses as it provides their family with death benefits if they, unfortunately, pass away.

What is Workers’ Compensation Insurance?

Workers’ compensation insurance are policies that provide medical benefits and wage compensation to workers injured on the job, in exchange for eliminating their right to file a lawsuit against their employer’s negligence.

Workers’ compensation benefits are designed to help employees if they are unable to work, cover medical expenses, as well as other expenses and rehabilitation costs associated with disability or illness. As you look to explore workers’ compensation options, it’s important to look for one that provides adequate coverage and compensation for your employees.

When you invest in a properly designed policy, it ensures you and your employees remain financially secure. It’s also important to look at the specific benefits that are offered within your policy. Typical workers’ compensation insurance policies cover medical benefits.

What is Covered with Workers’ Compensation Insurance?

Specific workers’ compensation laws vary depending on your state; however, the most common compensation states that require workplace injury insurance include the following:

  • Payment for lost wages
  • Vocational rehabilitation
  • Permanent disability
  • Temporary disability
  • Medical costs and treatment 

How to Prepare for Employee Claims

Accidents happen. It’s part of life. It doesn’t matter how safe your business is, there’s always the chance an employee will get sick or injured on the job. For this reason, nearly every state requires business owners to have coverage for their employees. Different states, however, have various regulations. 

Ensure you have an expert on your team to help understand what your specific business needs are. For example, if your business is in California, you are required to obtain workers’ compensation insurance even if your business is as small as just one employee. In Florida, however, you need this coverage if you have at least four employees. 

Signing up for workers’ compensation depends on the location of your business. Typically, states recommend you purchase workers’ compensation insurance through a private insurance company, while others may require you to buy it through a state-run insurance fund.

It’s also important to understand the cost associated with investing in workers’ compensation insurance. The risk associated with your specific business will determine the cost of your insurance payments. This all sounds pricey, but remember: the costs associated with not having workers’ compensation insurance might be the motivation you need to start considering your options.

Without workers’ compensation insurance, you put yourself and your business at risk of fines, and could even face potential jail time for not complying with regulations. If an employee runs into a problem that would have been covered by workers’ compensation insurance, you may be responsible for covering their expenses, and you may also open yourself up to litigation.

What You Need to Know About Workers’ Compensation as an Independent Contractor

Every contractor needs general liability insurance. While the law does not require it, it is considered best practice to ensure against the kinds of injuries and lawsuits general liability is targeted to.

Large contractors may own commercial buildings that require property insurance, where smaller contractors or those with a specialty may need different coverage. 

At Competitive Edge, we don’t claim to know your needs until we talk to you. What’s right for one company may not be a choice that meets your needs. Even if you have suffered a shock loss, large claim, or lawsuit, and find that your options have narrowed, we can work with you.

The first step is to show us under the hood so we can help you find the right carrier and coverage to protect your business today and always. Contact Competitive Edge Insurance today for more information about high-risk coverage today!

Your Guide Reducing Cybersecurity Risk:

Cyber threats were at an all-time high during 2020. As a large portion of the population transitioned to a work-from-home environment, cyber attackers viewed this new reality as a wonderful opportunity to prey on cyber vulnerabilities. 

According to SonicWall, in 2020, 304.6 million ransomware attacks occurred. As well as 81.9 million crypto hacking attacks, 4.8 trillion intrusion attempts, and 5.6 billion malware attacks. With these statistics in mind, it’s important to start working toward mitigating your cyber risk today. 

Let’s start by understanding what a cybersecurity threat is. 

Cybercriminals target individuals and businesses alike. Cyber hacking ranges in damages– it can be as small as a pesky popup, or as large as malware that destroys your entire organization’s system. Understanding where your business may be at risk is just the beginning. 

As you likely know, data is one of your greatest assets as a business and is becoming increasingly important. Protect your digital assets, and ensure you have the protection needed to ensure the safety of your business and your client’s information. 

Preparing for a cyber attack.

Before an attack

First and foremost, you should put the proper controls in place. These controls may include:

  • Using secure Password-protected networks
  • Avoiding suspicious links
  • Ignoring online requests for private information
  • Password-protecting all devices that connect to the internet
  • Adding variation to your passwords
  • Reporting suspicious activity right when you see it.

You should also ensure your train and inform your employees of the proper protocol to begin mitigating your cyber risk. Employees need to be trained on how to avoid:

  • Email threats: Email is one of the most common ways for hackers to get sensitive information from your employees. Your employees should always verify the sender, never open suspicious attachments, and never click on links if you don’t trust the source. 
  • Spam threats: Ensure your employees know to use their spam filter, flag spam when it appears in your inbox, and know to only give their email to trusted sources.
  • Phishing threats: Employees should know to never offer sensitive information, be aware of potential suspicious links, double-check website addresses, verify who they’re communicating with, and trust their suspicions. 
  • Social Media threats: Employees should be sure to manage their privacy settings on social media, never click on suspicious links that have been shared with them, and think twice before posting and ensure they aren’t sharing information that may be harmful. 

During a cyberattack

In the case that a cyberattack occurs, you need to understand the steps you should take. First and foremost, you must take immediate action. If a problem is found, disconnect your device from the internet and restore your system fully. Lastly, report the incident to your IT Department as soon as possible! 

After a cyberattack occurs

Once you’ve taken the steps listed above, three are a few follow-up steps you should take. 

  • File a report with the local police: Ensure there is a record of the incident.
  • Report to the internet crime-compliant center: Report any identity theft to the Federal Trade Commission.
  • Consider other information: If your personal information was compromised, what else could be at risk? 

Cyber Insurance for Cybersecurity Threats

As you start to consider the potential cyber risks associated with your business, consider investing in Cyber Insurance. It’s important to understand what would be covered under your cyber insurance policy. 

  • Data Breaches
  • Intellectual Property Rights
  • System Failure
  • Damages to a Third-Party System
  • Cyber Extortion
  • Business Interruption

Traditional business liability insurance likely won’t cover the cybersecurity risks associated with your business. 

As cyber threats continue to proliferate, ensure your business remains protected.

How to Measure Your Company’s Cybersecurity Risk

With the increase of cyber attacks on the rise, companies every day worry they will become the next victim. According to Cybersecurity Ventures, the number of cyberattacks has nearly doubled since 2019 and quadrupled since 2016 — with a cyberattack incident occurring every 11 seconds in 2021. 

At Competitive Edge, we believe all businesses are vulnerable to cybercrimes, not only large tech corporations. Global cybercrime losses are estimated at $400 billion per year. But not to fret — there are preventative measures your company can take, starting with learning how to measure your company’s cybersecurity risk.

Be Weary of Third-Party Risk

According to a recent study, 59% of companies experience a breach because of a vendor or third party. Although most companies have a variety of security regulations in place, many still fall susceptible to third-party or vendor risk.

The biggest challenge considering third-party risk is gaining real-time data. For example, most companies evaluate third-party risk through an assortment of questionnaires, assessments, or tests. This assortment of data gathering makes it difficult to see beyond just the snippet of information provided, and beyond into the ever-changing terrain of cybersecurity risk.

We recommended evaluating and refreshing what cybersecurity metrics and Key Performance Indicators (KPIs) your company is currently tracking. There are many tools that can help  evaluate third parties’ risk prior to onboarding—but the diligence shouldn’t stop there. Continue to monitor your third parties and vendors even after they’ve onboarded to ensure they are upholding best safety practices. 

Don’t let third-party risk slip through the cracks!

Define your Company’s Strategy for Measuring and Communicating Risk

Data, data, and more data! When it comes to analyzing cybersecurity risk, it can be difficult to know where to focus your efforts. Risk-based reporting, however, is your best bet. Risk-based reporting, “as opposed to comprehensive, compliance-based, or incident-based reporting… is the approach best suited to reducing your organization’s exposure to cyber threats,” according to BitSight.

Risk-based reporting focuses on the big picture—not the small blips—and forces you to use context to deliver reports, delving into data concerning:

  • “Past performance
  • Risk concentration
  • Industry benchmarks
  • Financial quantification
  • Cybersecurity frameworks”

Furthermore, the phrase, “stay in your own lane,” does not apply to companies when measuring cybersecurity risk! In fact, we recommend you look to your competitors to gain further context on your own stance in terms of cybersecurity risk. By measuring your own risk in comparison to similar companies or competitors, you might take more pointed action about where your team’s focus is needed to stay safe.

Make Your Data Digestible

Now, you’ve done all the work, but how can you make it clear and easy to understand? Security ratings are the most widely used and understood language when delving into cybersecurity risk. Ensure that all company team members understand the data and what efforts will be made as a result to combat the risk and why.

Measures You Can Take to Stay Secure

The consequences of poor cybersecurity are catastrophic. Geospatial World says, “The best cybersecurity strategies are ones that are proactive in nature. Being able to respond to and recover from an instance of hacking is important, but stopping the incident before it even starts is what saves your organization more time, money, and pain in the long run.” To avoid these consequences, Competitive Edge recommends you:

  • Keep a tight rein on who has access to company information
  • Conduct employee background checks
  • Create individual accounts for employees
  • Of course, not only to have strict cybersecurity policies, procedures, and practices but to enforce them

Cybersecurity is the type of threat you don’t want to put off dealing with until it’s too late. That’s where we come in! Talk to our experts at Competitive Edge today to measure your company’s cybersecurity risk and see how you can obtain proper coverage. 

Don’t risk it.

Cyber Liability Coverage for the New Era of Ransomware

With cybercrimes on the rise, it’s time to look not only at your practices but also your cyber liability coverage.