Wednesday, April 22, 2015

Work Comp Audit Tips

The workers compensation audit process is extremely important. At the beginning of the policy period you estimate your payroll in order for the company to provide an estimated premium for the year. This number is an educated guess because you have no way to foresee your business’s actual payroll until the completion of the year. This is why your Lake of the Ozarks insurance carrier will perform a work comp audit on your payrolls after the conclusion of the policy period. In some cases the business will do a reporting form throughout the year; however many businesses are only subject to an annual audit.

Keeping Payroll Seperate 


In order to avoid the pitfalls of a work comp audit you should be prepared well in advance for the process. One of the most important parts of the process is keeping your payroll separated when possible. If you have an employee that is doing multiple job duties your records should identify the workplace exposures and separate the payrolls by class. If your payroll records do not reflect this then the auditor will likely pool the entire payroll under the highest rated class description for that employee.

Subcontractors 


You should also have all certificates of insurance available from all 1099 subcontractors. If you do not show that the subcontractor carries his own coverage by providing documentation in the form of a certificate, you will be charged for the exposure of the subcontractor that is working on your behalf. All documentation should be readily available for when the auditor arrives.

Review the Audit


Provide the auditor with the payroll records they require and a comfortable area in which to work.  When they have completed the audit, ask them to supply you a copy of their worksheets. Be sure to review the worksheet and the audit bill once your receive these and be sure to compare the payroll classes on the policy verses the audit payroll classes. Review the rates for the class codes, the experience modification factor and any schedule credit as there should not be any changes from the policy. Also, be sure to check the math to make sure everything pencils out correctly. Even auditors can make mistakes.

Finally, be sure to contact the auditor to discuss any discrepancies or to answer any questions you may have. For any questions regarding workers compenstation at the Lake of the Ozarks, contact Insure the Lake at 573-348-2794.

Contact Insure the Lake today for all your Lake of the Ozarks business insurance needs! 



About the Author: Steve is a double back-flip insurance ninja. He was named Young Insurance Agent of the Year by the Missouri Association of Insurance Agents in 2010 and is a Certified Insurance Counselor. When he is not helping customers, he enjoys community service, Latin dancing with his beautiful wife and going on adventures with his two awesome sons.





Steve Naught, CIC

NAUGHT-NAUGHT AGENCY
3736 Osage Beach Parkway
Osage Beach, MO 65065
Next to Golden Coral

T: 573-348-2794
F: 573-348-0191


stnaught@naught-naught.com

Friday, April 17, 2015

6 Things You Need to Know About Creating a Will

Whether you're 25 or 75, creating a will is something everyone should do. Life is short and unexpected things happen everyday. Rather than letting your family and the courts deal with everything, make it easy for them by preparing a will. Your family will need time to grieve and doesn't need the hassle of deciding who gets what. While it may not be something you want to think about right now, it is important that you get one made. Here are some tips for getting everything in order for your will.

What is a Will? 


A will is a legal document that states who will manage your estate after you die. The person named in your will to manage your estate is called the executor becuase he or she executes your stated wishes. If you have children or dependants under 18, you will need to state who is to become their guardian. You can also state specific belongings that you would like to go to certain people.

Creating a Will


1. Choosing an Executor. 

One of the first steps in creating a will is naming an executor. This person will be responsible for handling your affairs after your death. In other words they are in charge of making sure your wishes, as stated in your will, are carried out. An executor has the following responsibilities:
  • Dealing with all the paperwork related to your estate. 
  • Gathering all the assets of your estate. 
  • Ensuring that all your debts, bills and taxes are paid out of the money in your estate. 
  • Distributing the remainder of your estate (after payments of debts, bills and taxes) in accordance with your will.
It is important that you choose this person wisely. It is also recommended that you discuss this with them first to make sure they are willing to take on the responsibility in the event of your death. You might consider appointing a second executor as a back-up incase your first choice also passes away or is incapacitated at the time of your death.

2. Appointing a Guardian.

If you have children under the age of 18, it is important that you appoint them a guardian. If you fail to appoint guardians in your will and both parents die before the children reach 18, the courts will appoint guardians instead. Taking on the role of a guardian can involve some significant expenses and you should consider making arrangements for this in the will as well.

3. Creating a Trust.  

A trust is an arrangement in which money, property or other assets are held and managed by the appointed Trustees on behalf of hte named beneficiaries. A trust is typically setup when a person writing a will has children under the age of 18. When setting up a trust, you must also name Trustees who will be responsible for managing the assets in accordance to your will until the children are old enough to take responsibility for them.

4. How to Distribute Assets. 

Your assets are everything you own, including: houses, land, overseas property, cash, stocks, shares &other investments, jewellery, antiques, household contents and other personal possessions. While you may leave your assets to whomever you wish, whenever possible, you should leave enough to your dependants for them to live on. When considering your dependants, be sure to include not only your children, but also anyone else that depends on you financially. This could include: your partner or spouse, adopted or step-children, anyone else you've been caring for as if they were your child, an elderly or infirm relative. There may also be other (non-dependent) relatives or friends to whom you want to give some small gift. This gift could be a sum of money or a specific object of monetary or sentimental value, either way this also needs to be stated in  your will.

5. Keep Your Will in a Safe Place. 

You want to make sure your will is stored in a safe place and there are several options for this. Many people think a safe deposit box is the best place. If you choose this route, make sure you are aware of the laws in your state. These laws can vary and you want to make sure your executor can easily access the will. Make sure you also grant the executor the legal authority to take possession of the will upon your death. Another option is to have your attorney hold onto the original; many attorneys will do this either free of charge or for a small fee. When choosing this route, be sure that your executor and beneficiaries are all aware of which attorney you use. If you choose to store it in your home, use a waterproof and fireproof safe. Be sure to tell the exectuor where the document is and also make sure they have the combination to the safe.

6. Update Your Will Regularly. 

Anytime you experience a major life event, such as a wedding, divorce, birth or death, you will need to update your will. Updating the beneficiaries of  your will helps ensure that your possessions will be properly allocated to your loved ones. Changes in assets also need to be added to or updated on your will. If you move to a new state, you will need to check with an attorney in that state to see what needs to be done to amend your will, as the laws vary from state to state. Keeping your will up-to-date may seem like a tedious process and while it is unnecessary to update it after every single big purchase or event, it is important to go over it on a regular basis to make sure the provision match your current circumstances. Your will is one of the most important legal documents that you sign, and the benefits of keeping it up-to-date far outweigh the periodic inconvenience of the updating process.

Just like with a will, your Lake of the Ozarks life insurance policy needs updated each time a life change occurs. Your life insurance policy and your will go hand in hand; they are both very important factors in making sure your family is taken care of after you're gone. For more information on making sure your family will be okay financially after you're gone, contact your Lake of the Ozarks insurance agent at 573-348-2794 today!

Contact Insure the Lake today for all your Lake of the Ozarks insurance needs! 



About the Author: Steve is a double back-flip insurance ninja. He was named Young Insurance Agent of the Year by the Missouri Association of Insurance Agents in 2010 and is a Certified Insurance Counselor. When he is not helping customers, he enjoys community service, Latin dancing with his beautiful wife and going on adventures with his two awesome sons.





Steve Naught, CIC

NAUGHT-NAUGHT AGENCY
3736 Osage Beach Parkway
Osage Beach, MO 65065
Next to Golden Coral

T: 573-348-2794
F: 573-348-0191


stnaught@naught-naught.com

Wednesday, April 8, 2015

What is Coinsurance?

When people hear the term coinsurance they may tend to think of their health insurance and the percentage of a claim they will be sharing with the company after paying the deductible. In the case of property insurance, the coinsurance is the amount you must insure your property in order avoid a coinsurance penalty in the event of a partial loss. Your Lake of the Ozarks insurance agent is here to help you understand coinsurance and how you can avoid a penalty.

Example of a Coinsurance Penalty


Let's say you get a great deal and buy a $100,000 replacement cost building for only $50,000, you may be tempted to insure the structure for the $50,000. Your thought might be: “I only have $50,000 invested, so if it burns down I would be fine with getting that amount in return.” In the case of a total loss, the policy would pay $50,000 less the deductible; however in the case of a partial loss, you would likely have a coinsurance penalty because you did not insure the building to value. Think about it this way: If half of the building was damaged in a fire and caused $50,000 in damage, then which half burned, the half you insured with the company or the half you “self” insured?

Coinsurance Percentages


Most companies have a coinsurance percentage requiring the insured cover the property to value. A typical coinsurance percentage is 80 or 90 percent. This means that you would only need to insure the building to 80 or 90 percent of the replacement cost to avoid a penalty on a partial loss. If you were to use a lower value, you may wish to consider insuring the building for actual cash value instead of replacement cost. If your policy is already on Actual Cash Value basis, you would definitely need to increase the value to avoid a penalty at claim-time.

Talk to your agent about running a replacement cost estimator on your building. This should give you a general idea if the property is insured correctly. The best way would be to talk to a contractor about the actual cost to replace your structure. Also, keep in mind you can have a co-insurance penalty on your contents as well if adequate limits are not kept. Revisit your property limits with your Lake of the Ozarks insurance company each year to keep the values where you need them. Proper planning is no accident.

Contact Insure the Lake today for all your Lake of the Ozarks insurance needs! 



About the Author: Steve is a double back-flip insurance ninja. He was named Young Insurance Agent of the Year by the Missouri Association of Insurance Agents in 2010 and is a Certified Insurance Counselor. When he is not helping customers, he enjoys community service, Latin dancing with his beautiful wife and going on adventures with his two awesome sons.





Steve Naught, CIC

NAUGHT-NAUGHT AGENCY
3736 Osage Beach Parkway
Osage Beach, MO 65065
Next to Golden Coral

T: 573-348-2794
F: 573-348-0191


stnaught@naught-naught.com

Wednesday, April 1, 2015

Do You Have Adequate Property Insurance?

When was the last time you thought about the value of your property? Many people don't pay any attention to property values until they need to file a claim. At that point, you can only hope that your Lake of the Ozarks insurance coverage is adequate. With the fluctuations in the market and property values, spending a little extra time to make certian your property is adequately insured is worth the investment! Naught-Naught Agency is here to help you understand property insurance!

How is Property Valued? 


On the majority of direct damage property forms, coverage will be valued in one of two ways:
  1. Replacement Cost - is defined as the cost to replace the property, new today, with materials of like kind and quality.
  2. Actual Cash Value - is the replacement cost less actual physical depreciation (not accelerated accounting depreciation).
In some cases, actual cash value might also make a deduction for economic obsolescence, as well as actual physical depreciation. The only different between the two valuation methods is depreciation. Therefore, if your property is brand new, with no depreciation, there would be no difference between the two methods. Accounting or book value has no relevance when it comes to either of these valuation methods and the choice of method will not affect your insurance rate.

The only difference in cost between replacement and acutal cash value is the cost of insuring the higher replacement cost values. The limit of coverage you select serves as the maximum on the amount to be paid in the event of a loss. In general, your Lake of the Ozarks insurance company has the option of repairing or replacing your property, subject to the limit of coverage for that property. 

Appropriate Building Coverage


When selecting an appropriate limit of coverage for your building, you're basically using the cost to rebuild a similar structure to the one that is being insured. The "building" is defined in the policy, but basically means the building or structure, as well as completed additions, fixtures, including outdoor furniture, permanently installed machinery and equipment, and personal property that are used to maintain or service the building.

Unless already covered by other insurance, coverage is also extended to additions under construction, as well as alterations and repairs to the building, and materials, equipment, supplies and temporary structures within 100 feet of the described premise, which are being used to make additions, alterations or repairs to the building or structure. There are a number of ways to accurately determine the replacement cost value of a structure including: 
  • Professional Appraisals
  • Original Cost Figures, Appropriately Indexed 
  • Square Footage Multipliers 

Be sure not to confuse the amount you paid for the building and property for the amount you need to insure them.  Market values here at the Lake of the Ozarks can vary greatly from the cost to replace a structure.  You could significantly underinsure or over-insure your property by using the market value as your insuring basis.

Business Personal Property 


Business personal property includes things such as: 
  • Furniture
  • Machinery 
  • Equipment
  • Stock
This also includes leased personal property that you have a contractural responsibility to insure. In general, when you lease a copier, computers or similar equipment, you are responsible for providing insurance. 

A long list of items are specifically not covered including, but not limited to: 
  • Money
  • Animals
  • Automobiles
  • Electronic Data
  • Cost to Restore or Replace Valuable Documents
  • Property Covered Under Another Coverage Form
There are insurance coverages available for many of these items listed above. However, this is under different policy coverage forms. 

Blanket Limits 


Does your business have multiple locations? If so, you should consider blanket limit of coverage. With blanket coverage, a single limit of liability will apply for all types of prperty at all locations covered by the policy. For example, if you have two buisness locations, each with $2 million in business personal property, you could select a blanket limit of $4 million. In the event of a catastrophe at any one location, you would have up to $4 million for that specific location. Blanket limits can also be helpful in situations where inventory is moved between two or more locations. 

Coinsurance Clauses


Most property policies are written with a coinsurance clause. A coinsurance clause requires you to insure your property to a specified percentage of its full value. This will typically be 80%, 90% or 100%. At the time of loss, if it is determined that the limit purchased is less than the limit required by the coinsurance clause, the loss recovery will be limited to that same percentage of loss as the ratio of the insurance amount carried to the insurance amount required. This is the penalty for being underinsured on a partial loss.  On a total loss the company would still pay the policy limits.

Agreed Value Provisions


An agreed value provision voids the coinsurance clause. This usually requires a signed statement of property values and sometimes, a recent property appraisal. An agreed value provision should be considered if available. 

For any further questions on adequately insuring any type of property, contact Insure the Lake at 573-348-2794. Your insurance agent at the Lake of the Ozarks is happy to answer any questions and assist you with all of your insurance needs!

Contact Insure the Lake today for all your Lake of the Ozarks insurance needs! 



About the Author: Steve is a double back-flip insurance ninja. He was named Young Insurance Agent of the Year by the Missouri Association of Insurance Agents in 2010 and is a Certified Insurance Counselor. When he is not helping customers, he enjoys community service, Latin dancing with his beautiful wife and going on adventures with his two awesome sons.





Steve Naught, CIC

NAUGHT-NAUGHT AGENCY
3736 Osage Beach Parkway
Osage Beach, MO 65065
Next to Golden Coral

T: 573-348-2794
F: 573-348-0191


stnaught@naught-naught.com