6 Factors Driving Commercial Auto Losses

commercial vehicle

A variety of trends have contributed to the rise of commercial auto losses. These trends have contributed to a different market for buyers of commercial auto insurance. Here is a look at the most significant factors driving commercial auto losses across the country.

More vehicles on the road-A record number of vehicles on the road means more traffic and congestion, which increases the risk of collisions.

Distracted driving- Today’s drivers face more distractions than ever before. Distracted driving can reduce awareness, decision-making, and performance which can result in an accident.

Driver shortage- A shortage of experienced commercial drivers has caused employers to hire people with less experience. Newer drivers are more likely to get into accidents.

Litigation trends- Lawyers are getting involved in more and more auto claims. This litigation drives the cost of claims. What’s more, trial verdicts related to motor vehicle crashes can be as much as six figures.

Rising medical costs- Medical costs continue to rise. As a result, many injuries caused by auto incidents exceed coverage limits.

Increased vehicle repair costs- While technological advancements have made vehicles safer and more efficient, they also increase vehicle repair costs.

Contact Midwest Insurance Group today at 262-646-5777  for more recommendations for employers to reduce the risk associated with commercial vehicle fleets as well as insurance options.

Using GPS To Help Manage Fleet Costs

GPS monitoring

As the workforce in America becomes more mobile, so do the capabilities of employers to track their employees on the road. From a distance, accurately monitoring employee productivity, working hours, injuries, conduct, and company property presents a challenge. The use of global positioning systems (GPS) is an excellent way to address these difficulties. Using satellites and receivers installed in a vehicle, laptop, or cell phone, these devices are able to locate an employee’s physical location and vehicle speeds with reasonable accuracy.

How GPS Tracking Works

GPS fleet monitoring started out as a tool specifically for the shipping and delivery industry, but the technology has proven its worth for almost any business with a fleet of its own.

GPS programs can be used on employee cell phones, laptops, or on stand-alone GPS devices, but the most robust information and management comes from devices installed directly into the company’s fleet vehicles. These devices can monitor and report on a wide variety of information, including speed, engine start-up, and shutdown routes, and idling.

The information from GPS systems can be available from the device, either uploaded or viewed on the device itself, or sent remotely to the main system. When sent to the system remotely, administrators and dispatchers can access the information in real-time via the internet or specialized software. Viewing maps of vehicle locations, routes, and vehicle status reports can help supervisors and dispatchers better manage their employees’ time and improve efficiency.

The Benefits of Using GPS

Fleet tracking can have multiple positive results for your business. Using the information reported from GPS devices can help eliminate inefficiencies and save time. Your workers can get more jobs per day, increasing productivity and, in turn, profits. This can also help improve customer satisfaction by reducing customer wait times.

Tracking can also reduce labor costs and unauthorized vehicle use. Monitoring vehicle locations and routes with timestamps will help you ensure all hours reported by workers are accurate. You can flag the movement of your vehicles during non-working hours or in certain areas where your company vehicles and workers should not be.

As well as improving employee monitoring, fleet operating expenses can be reduced through more efficient management of your vehicles, assisted by the data available from GPS. Fuel costs can be cut down by eliminating inefficient routes, unapproved employee usage, avoidable traffic delays, and speeding. The peace of mind of monitoring your vehicles and knowing where they are at all times improves the safety and security of your entire fleet, reducing or preventing the costs associated with theft.

Other ways GPS can reduce your costs include defending against false claims. For example, if a false claim comes in to your company that a vehicle of yours damaged property, such as a parked car, you can use your records to prove no vehicle was in the vicinity at that time.

The benefits of using GPS tools are useful to any company that owns fleet vehicles. However, there are also several legal considerations that employers need to consider and address before implementing GPS technology for their mobile workers to protect their employees and the company.

Invasion of Privacy

Employees may have a reasonable expectation that their location and actions are private from their employer.

For example, an outside sales representative attends a support group during his lunch break during working hours. Though he does not disclose this information to his employer or co-workers, the employer discovers that the employee is attending these meetings through GPS monitoring. The employer may then be held liable for invasion of privacy.

Employer Fails to Supervise Employees Properly

If an employer discovers that an employee presents a risk to others and does not act, the company is at risk for a claim of negligent supervision.

For example, a commercial driver tends to speed while he is on the job, and his employer discovers this through the GPS system installed in his vehicle. The employer does nothing about this discovery, and the driver subsequently gets into an accident because he was speeding. As a result, the employer is liable for negligent supervision.

Employee Discrimination

Though an employee’s membership with a group may be protected by federal and state discrimination laws, the employer may not always be aware that the employee is a member. Yet, with the use of GPS technology, an employer can sometimes discover their employees’ affiliations, thus supporting a discrimination claim.

For example, an employee is receiving treatment for a terminal illness on his own time. Through GPS tracking on his laptop, his employer discovers that the employee is ill. A few months later, the employee is terminated and when he files a disability discrimination claim, his employer cannot deny knowing about the employee’s illness because his laptop was being monitored.

Inaccurate Data Collection

If an employer makes an employment decision based on data collected from a GPS and the information is found to be inaccurate, the employer may be subject to defamation, wrongful termination and employment discrimination claims.

For example, the GPS system installed in a delivery driver’s vehicle inaccurately places the driver at a gentlemen’s club near where he is actually making deliveries. Though the employee was doing his job honestly, the employer assumes that he was visiting the club on the clock. As a result, the employee is terminated. This puts the employer at risk for claims of wrongful termination.

Additional Considerations of the Dangers of Using GPS Technology

There are additional dangers employers need to consider:

  • Employees who are monitored may feel as though their employer does not trust them and may relinquish some of the independence and individuality that they once brought to the job. This may negatively affect their independent decision-making abilities.
  • There may be an urge to implement unreasonable schedules because employees are constantly monitored.
  • The ability to monitor employees during breaks and before and after working hours can pose issues. By learning what employees do with their own time, an employer can obtain a full picture of the lives of their mobile employees. Thus, employers may breach the privacy that their employees expect and prefer.

Recommendations for Employers to Reduce the Risk Associated with GPS Monitoring

When using GPS devices to monitor your employees, consider these recommendations to reduce your risk:

  • Limit GPS monitoring to company-owned property, as it is easier for an employee to make a privacy claim while in possession of his or her own property.
  • Develop a comprehensive written policy about the use of GPS technology, and enforce this policy strictly. It should outline how the devices and the information attained will be used. All employees who will be monitored with a GPS device should acknowledge receipt of the policy in writing.
  • Limit GPS monitoring to the confines of the policy for legitimate business operations only.
  • Do not monitor any activities relating to union organizations, as that can be seen as unlawful surveillance.
  • Re-calibrate the system for accuracy on a regular basis.
  • Check with your legal counsel before implementing GPS technology.

Remember that while the use of GPS technology can be a powerful management tool, it can become a legal headache if not managed properly. By using this technology lawfully, you can benefit by improving the efficiency of your business while still respecting the privacy of your employees.

Contact Midwest Insurance Group today at 262-646-5777  for more recommendations for employers to reduce the risk associated with GPS monitoring as well as insurance options.

General Liability Exposures Every Organization Should Know

General Liability

Almost every organization faces commercial liability exposures. A commercial liability loss exposure is a condition or situation that presents the possibility of an organization becoming legally and financially responsible for injury, harm, or damage to another party.

These exposures stem from the kind of work an organization performs and where that work is executed. They also encompass other aspects of business-related circumstances, activities, or events that could result in harm to a third party.

Read this article to better understand the most common types of commercial liability loss exposures and potential consequences and for guidance on how the correct insurance policy can reduce the risk to organizations.

Common Types of Commercial Liability Exposure to Know

There are five types of commercial liability exposure that every organization should know. Possible loss exposures that may affect an organization include the following:

Premises liability—Premises liability describes the risk an organization faces if a customer or client is injured on the premises (e.g., tripping and hurting themselves at the store). Organizations that require customers or clients to be physically present, such as retail stores and landlords, are particularly at risk for these losses and may be held liable for bodily injury or property damage.

Operational liability—Operations liability exposure refers to the possibility that an organization will be held liable because of bodily injury or property damage that occurs as a result of their ongoing (as opposed to completed) operations. For example, imagine a contractor working on a client’s home. During the course of their work, an employee from the contractor drops a tool, striking a passerby and causing bodily injury and property damage to the home itself.

Product liability—Product liability refers to the loss exposure an organization faces as a result of manufacturing, distributing, or selling an unsafe or defective product. Any organization that makes or sells products is at risk. Associated injuries may occur virtually anywhere in the world once an organization’s products have been manufactured or sold.

Completed operations liability—The completed operations liability exposure refers to injuries or damages incurred by a third party due to work (including construction work) that has been finished, turned over to the purchaser or client, and/or put to its intended use. For example, an electrical fire caused by faulty wiring at a completed construction project would represent a completed operations exposure for the contractor who completed the work. It should be noted that injuries or damages arising out of completed operations can occur after a business’s relationship with the injured party has ended.

Contractual Liability—Organizations take on contractual liability loss exposures when they enter into a contract. By agreeing to contractual terms, an organization becomes liable if the other parties involved in the contract believe an organization has not fulfilled its obligations under the agreement.

Potential Consequences of Liability Exposures

In the event of a commercial liability loss, organizations can face a variety of potential consequences, such as:

  • Damages—If a court deems an organization responsible for a loss, that organization may be held financially accountable for paying damages to the harmed or injured party.
  • Defense costs—The organization may have to pay legal defense costs and the costs associated with the claim.
  • Reputational harm—Due to general liability losses, organizations may experience reputational harm, including but not limited to the loss of business, decreased employee retention, and a loss of consumer loyalty and investor trust.

Although commercial liability loss exposures are a risk for every organization, the severity of the consequences can be alleviated with proper insurance policies.

Commercial Liability Insurance

No matter how careful an organization is, there will always be risks associated with commercial liability loss exposures. Therefore, the best way to protect an organization is to purchase commercial general liability coverage (CGL).

CGL policies are designed to cover an organization from liability claims for bodily injury and property damage to third parties. CGL policies have three standard coverages:

Bodily injury and property damage—This coverage protects organizations from the legal liability arising from bodily injury and property damage stemming from an organization’s premises or operations.

Personal and advertising injury—This aspect of CGL policies protects insureds from liability stemming from accusations of libel, slander, false arrest, copyright infringement, malicious prosecution, theft of advertising ideas, and invasion of privacy.

Medical payments—Medical payments coverage includes payments for injuries sustained by third parties that are caused by an accident at the insured’s premises or the insured’s operations. Unlike bodily injury and property damage coverage, medical payments coverage can be triggered without legal action and is designed to settle smaller, less serious medical claims without litigation.

Consult our trusted Wisconsin insurance professionals at Midwest Insurance Group in Delafield, Wisconsin for further guidance on how to protect your organization from commercial liability loss exposures.

Cyber Security For Small Businesses

cyber security

High-profile cyber attacks on companies such as Target and Sears have raised awareness of the growing threat of cybercrime. Recent surveys conducted by the Small Business Authority, Symantec, Kaspersky Lab, and the National Cybersecurity Alliance suggest that many small business owners are still operating under a false sense of cyber security.

The statistics of these studies are grim; the vast majority of U.S. small businesses lack a formal internet security policy for employees, and only about half have even rudimentary cyber security measures in place. Furthermore, only about a quarter of small business owners have had an outside party test their computer systems to ensure they are hacker-proof, and nearly 40% do not have their data backed up in more than one location.

Don’t Equate Small with Safe

Despite significant cyber security exposures, 85% of small business owners believe their company is safe from hackers, viruses, malware, or a data breach. This disconnect is largely due to the widespread, albeit mistaken, belief that small businesses are unlikely targets for cyber attacks.

In reality, data thieves are simply looking for the path of least resistance. Symantec’s study found that 43% of attacks are against organizations with fewer than 250 employees.

Outside sources like hackers aren’t the only way your company can be attacked—often, smaller companies have a family-like atmosphere and put too much trust in their employees. This can lead to complacency, which is exactly what a disgruntled or recently fired employee needs to execute an attack on the business.

Attacks Could Destroy Your Business

As large companies continue to get serious about data security, small businesses are becoming increasingly attractive targets—and the results are often devastating for small business owners.

According to a recent study by the Ponemon Institute, the average annual cost of cyber attacks for small and medium-sized businesses is over $2 million. Most small businesses don’t have that kind of money lying around, and as a result, nearly 60% of small businesses victimized by a cyber attack close permanently within six months of the attack. Many of these businesses put off making necessary improvements to their cyber security protocols until it was too late because they feared the costs would be prohibitive.

10 Ways to Prevent Cyber Attacks

Even if you don’t currently have the resources to bring in an outside expert to test your computer systems and make security recommendations, there are simple, economical steps you can take to reduce your risk of falling victim to a costly cyber attack:

  1. Train employees in cyber security principles.
  2. Install, use and regularly update antivirus and antispyware software on every computer used in your business.
  3. Use a firewall for your internet connection.
  4. Download and install software updates for your operating systems and applications as they become available.
  5. Make backup copies of important business data and information.
  6. Control physical access to your computers and network components.
  7. Secure your Wi-Fi networks. If you have a Wi-Fi network for your workplace make sure it is secure and hidden.
  8. Require individual user accounts for each employee.
  9. Limit employee access to data and information, and limit authority to install software.
  10. Regularly change passwords.

In addition to the listed tips, the Federal Communications Commission (FCC) provides a tool for small businesses that can create and save a custom cyber security plan for your company, choosing from a menu of expert advice to address your specific business needs and concerns. It can be found at www.fcc.gov/cyberplanner.

Your Emerging Technology Partner

A data breach could cripple your small business, costing you thousands or millions of dollars in lost sales and/or damages. We have the tools necessary to ensure you have the proper coverage to protect your company against losses from cyber attacks. Contact Midwest Insurance Group today at 262-646-5777 for additional cyber risk management guidance and insurance solutions.

Cyber Risks And Liabilities

cyber security

Protecting Your Intellectual Property

Intellectual property—patents, trademarks, copyrights, and trade secrets—may be more important to your business than tangible assets. There are various avenues you can take to protect them from competitors and, more importantly, thieves. It is estimated that intellectual property theft could be costing domestic companies at least $600 billion in lost annual revenue.

Understanding your intellectual property and how to protect it is essential for a business to be successful; however, protecting them must be done correctly to prevent losses from a cyber attack.

Four Types of Intellectual Property

  1. Patents give your company the legal right to exclude anyone else from marketing and selling your invention. They can also be registered in foreign countries, further expanding your right to the invention. Patents can last for 20 years.
  2. Trademarks protect your identity. For example, when someone hears the phrase, “Have it your way®,” he or she automatically thinks of Burger King. In addition to slogans, trademarks can be a name, sound, or symbol related to a company. Trademarks can be registered, but a simple ™ symbol is all that is needed to mark the name, slogan, or symbol as a particular company’s property.
  3. Copyrights protect original works of authorship fixed in a tangible medium of expression, such as novels, songs, poetry, computer software, and movies. It does not protect things such as facts, ideas, or methods of operation. Copyright registration is also voluntary, but it exists from the moment of authorship. Copyrights last for the entirety of the author’s life plus an additional 70 years.
  4. Trade secrets can be tough to define, as it varies by jurisdiction, but it is essentially commercial information that provides a business with an advantage over competitors who do not have that information. Trade secrets are generally not known to the public and a business must make reasonable efforts to maintain their secrecy.

International Issues

Doing business internationally is obviously attractive to U.S. businesses. However, laws protecting intellectual property in foreign countries are not as clearly defined, creating problems for American-based companies.

The United States has long been at the forefront of protecting intellectual property for its domestic companies, but the same is not true for many other nations. Other countries have chosen not to offer intellectual property protection to businesses operating within their boundaries.

Countries like Russia, China, and Ukraine have become “cyber-crime havens” for their unwillingness to prosecute criminals who commit cyber crimes within their borders. In most cases, law enforcement on cyber crimes is either lax or completely ignored.

The rise in outsourced companies and jobs has also had an effect on how intellectual property is protected. For example, a company that outsources its IT jobs to India might quickly discover that its trade secrets are compromised because a) intellectual property laws are usually enforced locally, and b) countries like India don’t have strong laws protecting intellectual property. The World Trade Organization’s Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement sets down minimum standards for many forms of intellectual property regulation around the world, but many nations and localities do not enforce this agreement, leaving multinational corporations vulnerable.

However, there are steps a company can take to protect its intellectual property when outsourcing work:

  1. Send people to inspect the space your firm will be working in. Ensure the building’s security is sufficient and that all the necessary security measures are in place.
  2. Ensure all sensitive information, such as passwords, credit card numbers, and personal information is encrypted and stored behind a firewall.
  3. Ensure the outsourcer has proper hiring policies and that they don’t also do business with a direct competitor.
  4. Know and understand the host country’s culture and legal landscape. Know how serious law enforcement and the courts are about enforcing cybercrime and intellectual property laws.

The cost of doing business abroad may be cheaper, but there is inherently more risk involved.

Protecting Your Intellectual Property

Failing to provide a sufficient amount of protection for your company’s intellectual property can lead to lost sales and high legal fees to catch the criminals to get your stolen information back. The following tips will help you keep your intellectual property safe:

  1. Your higher-level employees should know exactly what types of intellectual property your business has and understand ways to protect it. Educate them on what stolen property could mean in terms of your bottom line.
  2. Invest in legal counsel that specializes in protecting intellectual property. This could mean the difference if your company’s intellectual property is ever compromised.
  3. Provide awareness training to all employees. If they are made aware that all of their hard work and time spent on a project could go to waste when an idea is stolen, they may be more apt to follow important security measures.
  4. Keep your data secure by any means necessary. Lock storage rooms with sensitive data. Invest in firewalls and routers for your computer network. Install security cameras around various parts of the business.
  5. Dispose of documents properly. Shred before disposing of—never throw whole documents into the dumpster. If you have insufficient means to do this, consider hiring a third party to do it for you.
  6. Think big picture. Suspicious activity around the office or on your computer network might mean nothing, but it could also be part of a bigger plan to steal your intellectual property. Take prevention seriously and treat every incident as important.

Protecting your intellectual property can be confusing and risky. We can ensure you have the coverage and proper policies in place to protect your intellectual property from getting into the wrong hands. Contact Midwest Insurance Group today at 262-646-5777 for more cyber risk management tips.

The Risks of Vacant Property

vacant property

Theft, trespassing, fires or other losses are constant threats on vacant construction sites. Losses might include not only the value of damaged or stolen materials but also the liability of an individual being injured on the property and the loss of time if a crucial piece of equipment is damaged or stolen. The insurance risks and liabilities associated with vacant construction sites can be extensive. To ensure that you are adequately protected, it is important to know the risks you face. In addition to purchasing comprehensive insurance coverage, there are numerous preventive strategies you can adopt to maintain vacant properties in a way that reduces risk and liability.

Potential Risks Of Vacant Property

Like any vacant structure, vacant construction sites are first and foremost an obvious target for theft, trespassing, and vandalism. Keep in mind that contractors can be held liable for injuries sustained by children that trespass or play on vacant construction sites. Moreover, vacant construction sites are susceptible to fire. A study by the U.S. Fire Administration reveals that each year, an estimated 4,800 construction site fires and cause $35 million in property loss; in most cases, the sites are vacant. Firefighters on construction sites are also twice as likely to be struck by debris or objects than firefighters in residential fires.

Other Ways to Mitigate Risk

In addition to extending coverage, there are some simple steps that contractors can take to limit their risk and liability.

  • Prevent vandalism – leaving construction sites properly lit and with sufficient signage can help keep thieves and vandals out.
  • Limit liability – make sure property is free of significant hazards that could cause injuries to anyone on the property – this could include police officers, maintenance workers, firefighters, or even trespassers. Walls, equipment, ditches, and other physical features could be classified as attractive nuisances should they cause the injury to anyone on the property.
  • Avoid damage – remove all access material and combustibles from in and around the site. Inspect the site regularly for potential fire hazards and remediate them as soon as possible.

Builder’s Risk Insurance

Many times your contract with the property owner will require you to purchase builder’s risk insurance, which protects the property and any insurable materials on site against fire, vandals, lightning, wind, and other similar forces while it is under construction.

Because of the increased risks and liability associated with a vacant site, these types of insurance tend to be costly. It is important, though, to look beyond the price and consider the suitability and comprehensiveness of the coverage being purchased.

To obtain vacant property insurance or learn more about risks to vacant property, contact Midwest Insurance Group, LLC today at 262-646-5777.

Understanding a Personal Article Floater

Personal Article Floater

It’s a common misconception that homeowner’s or renter’s insurance policies cover all personal property. Even if they do cover personal items, there is often a financial limit as to what those policies will cover. Sometimes the amount covered is well below the item’s value. For highly valuable items, unique or hard-to-find items, or items that change physical locations frequently, you should consider a personal article floater.

What Is a Personal Article Floater?

A personal article floater policy is a type of inland marine insurance that may protect readily movable property. The coverage travels or “floats” with the valuable items. It can supplement your other standard insurance policies, such as a homeowners policy. A personal article floater can be a separate policy or an endorsement from your current insurer.

A personal article floater is typically designed to provide “open peril” coverage. This means that items will be covered unless explicitly excluded from your policy.

What Does a Personal Article Floater Cover?

A personal article floater can cover a wide range of personal property items, such as:

  • Jewelry and luxury handbags
  • Furs and antiques
  • Silverware, glassware, and china
  • Cameras, computers, and electronics
  • Coin and stamp collections
  • Sports memorabilia

What Types of Settlement Options Are Available With a Personal Article Floater Insurance Policy?

Two different types of loss settlement options are typically available with a personal article floater insurance policy:

  • Replacement cost settlement—This type of settlement generally provides coverage that replaces the item with one of like kind or quality. The amount of the replacement may be lower than the value listed on the policy.
  • Agreed value settlement—This type of settlement typically pays the amount for which the item is listed on the policy. This option may require an additional premium.

For More Information On Personal Article Floater Coverage

If you have questions about your coverage or would like to learn more about a personal article floater, contact Midwest Insurance Group today at 262-646-5777.

How Credit History Impacts Life Insurance Cost

life insurance

Does Your Credit History Partly Determine The Cost Of Your Life Insurance?

It may. The potential for such a relationship may surprise you – and the relationship is not without controversy.

Some insurers believe a good credit history implies several things

Many insurance providers believe a strong credit history is characteristic of a consumer who is mature and routinely lives up to financial responsibilities. A bankruptcy on your record may lead to increased premiums.1

Other types of data may also be evaluated

In addition to credit history, insurance companies may also look at a consumer’s driving record, criminal history, use of prescription medicines, and occupation. All this may affect life insurance coverage and premiums.1

Why are life insurance providers interested in all this information?

They want to make their business models more efficient. Insurance providers know that life insurance underwriting usually takes weeks or months and includes a medical exam. They believe that by basing it on partially predictive models, insurers remove a psychological hurdle that stands in the way of some policy sales. This sort of underwriting can take as little as 48 hours.2

So, yes, your credit history may affect what you pay for life insurance

While it may not be a prime factor, it does exert an influence. That is another good reason to keep your credit score high.

At the end of the day, what all this means is that you get the coverage you need to help your business grow. MIG covers contracting and building companies of all types and sizes. You can rest assured that support will be there to help you develop loyalty, provide great service and avoid unnecessary losses no matter how successful you become.

Midwest Insurance Group partners with Erie insurance, one of the nation’s leading auto and home insurers, with an A.M. Best rating of A+ (Superior).

Please feel free to give us a call at 262-646-5777 .

Umbrella Insurance for Your Business and Peace of Mind

umbrella insurance

In a culture where litigation is commonplace, business owners have many more worries than making profits and retaining top employees. If your product injures a consumer, your organization could face a devastating lawsuit, exponential damages, and a tainted reputation in the marketplace. To assist with the financial burden of a claim, many business owners purchase commercial umbrella insurance on top of their standard commercial general liability (CGL) insurance policies.

Most CGL policies have an aggregate limit that, once exhausted, will not cover any other excess claims. Experienced business professionals understand that the litigious nature of our society combined with surmounting liability judgments are reason enough to purchase additional coverage.

Lawsuits frequently impose multimillion-dollar penalties on businesses—far outside the coverage provided by most CGL policies. As a result, common losses such as vehicle accidents, employment claims, and hazardous substance spills can pose a serious financial threat.

Businesses are also liable for the health and safety of their employees and for their employees’ behavior. For instance, your business could be held liable after your holiday party results in property damage to a rented banquet hall. You may also face litigation if your business office has a carbon monoxide leak that causes a number of employees to get extremely ill. To protect against an unforeseen claim similar to these, commercial umbrella insurance protection is a must.

Purpose of Umbrella Coverage

Umbrella coverage is designed to protect an organization against monumental liability claims that can demolish a business through a large financial judgment. Typically, an umbrella policy serves the following purposes:

  • Provides coverage for potential damages and court defense fees that exceed underlying insurance policies (typically CGL policies).
  • Provides coverage in situations that are not covered by underlying insurance policies but are not excluded from the umbrella policy. This benefit is subject to a self-insured retention (SIR), similar to a deductible, in which the policyholder is responsible for losses up to the SIR amount.
  • Applies to claims where the aggregate limit of the underlying policy has been met. The umbrella policy will cover the portion of the claim that cannot be paid with the underlying policy because there are not enough funds available in the policy to cover the entire claim. For instance, if at the time of a claim your CGL policy has $500,000 remaining and the claim in question is $1.5 million, then the CGL policy will cover $500,000 and then the umbrella policy will cover the remaining $1 million.

Coverage Details

A typical umbrella policy has the following features:

  • Offers coverage worldwide for personal injury, blanket contractual liability protection; care, custody, and control, non-owned aircraft liability, watercraft liability, advertisers liability, liquor law liability and explosion, collapse, and underground (XCU) liability.
  • Offers an extension of insurance protection for additional insureds.
  • Policies follow form, meaning they abide by similar provisions and cover similar losses as the underlying policy. If claims are not covered by an underlying policy, the umbrella policy makes the business responsible for the loss if it exceeds SIR limits. The damage must also involve personal injury, property damage, or advertising injury.
  • The insurer has the right to investigate all claims not covered by any underlying insurance.
  • Policies either cover all individuals or cover parties that gain insured status within the contract. Policies also protect an organization’s executive officers, regular employees, directors, and stockholders acting on behalf of the organization. Protection for additional insureds is typically excluded when claims involve motorized vehicles, watercraft, and aircraft.

Beyond these stipulations, a commercial umbrella policy ascertains that an organization must hold an underlying insurance policy during the term of the policy. To learn more about averting your business risks with commercial umbrella insurance, contact Midwest Insurance Group, LLC at 262.646.5777

Attracting and Retaining Construction Workers in Today’s Labor Shortage


Regardless of company size or industry, employers are struggling to attract and retain quality workers. With the construction industry expected to continue to grow in 2022 and beyond, construction companies and contractors face a labor shortage and struggle to find workers to meet industry demands. This article highlights new employment research, outlines factors contributing to today’s worker shortage, and offers tips to help employers attract and retain skilled workers.

Labor Market Factors

The first contributing factor to today’s employment challenges is anticipated industry growth. Of note, the recently signed $1.2 Trillion Infrastructure Investment and Jobs Act will likely contribute to this growth as roads, bridges and other infrastructure will be updated countrywide. Although industry demand is promising, companies need skilled workers to meet the booming demand. Consider the following statistics regarding industry growth and demand:

Another factor in today’s labor shortage is the high number of workers in the industry reaching retirement age. An overwhelming number of construction workers are expected to retire over the next decade; according to the National Center for Construction Education and Research, 41% of the current construction workforce will retire by 2031. Fewer young workers are joining or staying in this workforce, as there has been more focus on higher education than the trades in recent decades. Furthermore, many of those industry veteran workers have management roles. In addition to finding employees, employers will also need to address leadership gaps to keep their operations running smoothly and retain institutional knowledge.

Like many other industries, the construction industry competes for today’s workers amid high turnover rates. Regardless of industry, the pandemic caused many employees to reconsider their line of work and try different roles or industries entirely. This employment shift is especially difficult for construction companies and contractors, as the candidate pool for construction is significantly narrowed since they depend on workers who have acquired specialized skills.

New Research

In early 2022, employers across the country were surveyed about various employee attraction and retention topics, and more than 150 employers of all sizes and industries responded. Notably, the construction industry had a high participation rate in Zywave’s 2022 Attraction and Retention Employer Pulse Survey. Consider the following key research findings from respondents in the construction industry:

  • Over 90% of organizations somewhat have difficulty attracting new employees.
  • 58% of organizations at least somewhat have difficulty retaining current employees.
  • 81% of employers consider employee attraction and retention a top-five business challenge and expect the trend to continue.

Employee attraction and retention come with general hurdles, but construction leaders say they are working most to combat these specific challenges:

  • Increasing compensation to meet current demands
  • Addressing current and future skills gaps
  • Addressing increased benefits demands
  • Meeting desires for flexible work arrangements (i.e., remote, hybrid, flexible hours)

Such challenges significantly impact talent strategies. Similarly, surveyed organizations reported that the top priorities of today’s workers include competitive compensation, competitive benefits, and flexible schedules.

While those components are what today’s construction workers are looking for, employers have their own wish lists for ideal candidates and employees. Experience, reliability and professionalism are the top desired traits of construction workers. Knowledge and technical skills were top traits for roughly a quarter of respondents, suggesting that employers would instead hire for personal attributes and soft skills, potentially supporting new hires with technical training on the job.

Worker Attraction and Retention Tips

Bringing in and keeping workers will continue to be a top challenge for construction companies and contractors. The construction industry is struggling to find skilled workers to meet the current and upcoming work demands—and there are no quick fixes for many of the reasons this is happening.

As workers retire, take other construction jobs or leave the industry altogether, employers will need to get creative with employee attraction and retention strategies. Consider these general tips:

Expand Recruitment Tactics

Employers can consider the best methods for reaching suitable candidates and growing their candidate pool. As the construction industry looks to recruit a new generation—specifically millennials and Generation Z—new recruitment tactics can be successful. In addition, construction employers can consider ways to grow their applicant pipeline by considering underrepresented groups in the industry.

According to the BLS, women make up around 10% of workers in the construction industry, trailing most other key sectors. However, this creates an opportunity to increase talent pools in this expanding industry.

There’s no single approach, but employers could try using social media, attending job fairs, or presenting at high schools, trade or technical schools, and universities to target key and new talent markets. Recruitment tactics that worked in the past likely won’t be as impactful in today’s market.

Invest in Training Opportunities

Employers can provide learning and development opportunities to both long-term and new employees to address looming skill gaps left behind by retired workers. After all, the construction industry requires workers to have specialized skills, and the work comes with a variety of safety hazards. Learning opportunities may be a way to recruit young employees and help them build a career in the construction industry. Here are a few examples of learning and development opportunities:

  • Employee training can focus on specialized skills, new technology, or safety-related topics. It’s essential to identify any skills gaps left by retirement. The rework rate is a major concern for construction projects, and proper training can help businesses avoid such costly circumstances.
  • Hands-on training can be the most engaging since employees actively participate and may remember their experience better. As soon as new technology is available or used on a site, employers could allow all workers to interact with and practice using it. This will also help supervisors understand if there’s a learning gap with devices or software so they can pivot to correct mistakes before they happen on-site.
  • Virtual training can help employees learn about health and safety regulations quickly and safely. Safety is critical in the construction industry. On-demand virtual training allows employees to test their skills and knowledge and retake lessons as needed to become familiar and comfortable with safety rules and standards.
  • Simulated training, including augmented reality (AR) and virtual reality (VR), can provide hands-on training without endangering workers. Employees can use VR to learn how to operate remote-controlled heavy equipment without damaging equipment and other materials or worker injuries. Additionally, employers could use AR to allow teams to learn how to repair equipment or other critical mechanical components.
  • Mentoring plans can prepare newer employees for future leadership roles and support the transfer of institutional knowledge from seasoned employees.
  • Leadership development programs can also help prepare employees for management roles. The transition to supervising can be a significant change for many.

The internal promotion of skilled trade positions to managerial roles can also strengthen employee morale and provide clear career paths. Many managers who have or will be retiring may have started in an entry-level or junior position. Such employees understand the work and what it takes to be successful on the job—and they often can be great managers and leaders for the business. Besides offering such opportunities, it’s equally important to promote them during recruitment and leverage them as a selling point to workers.

Review Compensation and Benefits Strategies

Regardless of the line of work, employees are looking for competitive salaries and benefits. If raises or sign-on bonuses aren’t feasible, a benefits package could help seal the deal for some workers. Disability and life insurance can go a long way in showing that companies care about construction employees’ health and well-being. To assist with employee retainment, employers could consider ways—such as health and wellness programs—to help employees in their work and personal lives.

Provide Autonomy

Work autonomy means giving employees the freedom to work in a way that suits them. As such, employees get to decide how and when their work should be done. This type of workplace flexibility can go a long way with workers as the construction industry is generally very rigid and comes with high levels of problem-solving.

As feasible, construction employers could look for ways to minimize micromanagement and focus on policies instead of processes. Job autonomy builds trust with employees because it gives them the freedom to manage their work and helps them find purpose in their day-to-day work. Furthermore, autonomy could help encourage mastery as well. Workers who are newer to the industry may feel like a master of their work sooner, which bolsters confidence and accountability. In today’s labor market, accountability and autonomy can be a winning combination to attract and retain skilled workers.


Attracting and retaining construction workers has never been easy. Still, the problem has only worsened during the pandemic because of factors such as highly-skilled workers retiring or reconsidering their line of work. As industry growth outpaces talent availability, employers will need to get creative with their efforts to compete in today’s tight labor market.

Reach out to us for more attraction and retention guidance.

We Have You Covered

Whether you’re part of a large construction firm looking for some extra assistance in risk control or you’re a hands-on locally based contractor, MIG has coverage where you need it. There are too many benefits to list here, but here’s a summary of the main features of the contractor’s program:

  • Construction contract reviews
  • Bid and performance bonds
  • The opportunity to earn dividends
  • Contractor’s errors and omissions
  • Environmental and pollution liability
  • Owner’s and contractor’s protective liability
  • Wrap-up Coverage (Sweeping blanket coverage that protects the owners, the contractors, and subcontractors).
  • Employment practices liability including third-party coverage
  • Cyber Liability
  • Electronic OSHA log
  • Carriers that accept all lines of contractor coverages
  • Multiple AM Best A-rated insurance

At the end of the day, what all this means is that you get the coverage you need to help your business grow. MIG covers contracting and building companies of all types and sizes. You can rest assured that support will be there to help you develop loyalty, provide great service and avoid unnecessary losses no matter how successful you become.

Midwest Insurance Group partners with Erie insurance, one of the nation’s leading auto and home insurers, with an A.M. Best rating of A+ (Superior).

Please feel free to give us a call at 262-646-5777 .