Know Your Insurance: Auto

UM and UIM Coverage, Exclusions and Endorsements

Unfortunately, many people wrongly assume that auto and umbrella insurance policies will provide reimbursement for all aspects of an accident on the road. Instead, both of these policies cover your own liability and provide compensation to others in the event that you are responsible for an accident. However, if another driver causes an accident and doesn’t have enough insurance coverage to compensate you, your own auto or umbrella policies won’t be enough.

If another driver doesn’t have enough insurance coverage to pay for your medical bills, you could face extremely high costs or lengthy court battles. However, by purchasing stand-alone uninsured (UM) or underinsured (UIM) motorist coverage—or by adding the coverage as an endorsement to your umbrella policy—you can be fully protected on the road.

Why Isn’t There Coverage?

Auto insurance is required in most states because all drivers on the road essentially put their trust in one another to not get into an accident. As a result, your regular auto insurance policy will reimburse another driver if you are the cause of an accident. In a similar way, umbrella policies provide you with excess coverage for a number of different personal liabilities.

However, if another driver doesn’t have enough coverage to fully pay for the damage of an accident, you could be left to pay the bills yourself.

  • Uninsured motorists simply don’t purchase an auto insurance policy. As a result, if they cause an accident, there isn’t a policy in place to reimburse you for medical bills. According to the Insurance Research Council, about 1 in 8 drivers in the United States are completely uninsured.
  • Underinsured motorists have an insurance policy, but don’t have a high enough coverage limit to pay for all of the expenses of an accident. Some states only require a small amount of coverage, which won’t be enough to pay all of your medical expenses.

It’s also important to know that hit-and-run accidents—those in which a driver flees—fall into the same category as uninsured motorists, as there is no insurance policy in place to cover the driver’s liability.

To protect yourself from these risks, it’s important to talk to your Midwest Insurance Group representative about a stand-alone policy or an endorsement to your umbrella coverage.

Coverage Specifics

Without UM or UIM coverage, you’re essentially paying more for the protection of strangers than you are for yourself and your family. And, although uninsured and underinsured drivers are all too common, many people believe that they’re already covered if someone else causes an accident.

UM or UIM policies are available, as are endorsements to umbrella policies that can protect you from uninsured or underinsured drivers. In fact, in many states, you may be required to purchase UM or UIM coverage. However, just like a normal auto policy, there are some aspects of this coverage that you should consider.

Depending on the state, you may only be required to purchase a small amount of UM or UIM coverage. However, since these policies will protect you and your family in the event of an accident, it’s generally a good idea to purchase the same amount of coverage as your regular auto policy. Coverage is also inexpensive, generally costing only 5% of your regular auto insurance premiums.

Contact us today at 262.646.5777 to examine your auto insurance coverage and ensure that you and your family are safe on the road.

 

Small Business Bulletin – CyberSecurity Best Practices

Cybersecurity Best Practices

Cyberattacks are becoming more frequent and complex, and businesses of all sizes and industries are potential targets. In fact, cybercriminals increasingly go after small businesses since they contain much of the same types of sensitive information as larger enterprises but often have weaker cybersecurity defenses. Verizon’s 2023 Data Breach Investigations Report found that 43% of all cyberattacks target small businesses, and 60% of those victims go out of business within six months of the attack.

Even if a small business survives a cyberattack, there can still be devastating consequences, such as high costs, reputational damage and unanticipated downtime. To best combat these risks, it is important for small business owners to be aware of common cyberthreats they may face, including: 

  • Phishing—Phishing is a type of cyberattack that utilizes deceptive emails or other electronic communication to manipulate recipients into sharing sensitive information, clicking on malicious links or opening harmful attachments. Emails are the most common delivery method for phishing attempts, but cybercriminals may also use text messages, social media messages, fake or misleading websites, voicemails or even live phone calls. 
  • Business email compromise (BEC)—A BEC scam entails a cybercriminal impersonating a seemingly legitimate source—such as a senior-level employee, supplier, vendor, business partner or other organization—via email. The cybercriminal uses these emails to gain the trust of their target and trick them into wiring money, sharing sensitive information or engaging in other compromising activities.
  • Malware—Malware is a general term that describes viruses, worms, Trojan horses, spyware, adware, rootkits and other unwanted software or programs. Once a malware program has gained access to a device, it can disrupt normal computing operations, collect information and control system resources. 
  • Insider threats—Workers who have access to sensitive information, including contractors with access to the company’s network, may be aware of existing security weaknesses and can exploit them more easily than outsiders. 
  • Password attacks—Using weak or easily guessed passwords or using the same password for multiple accounts can result in compromised data.

To limit the risk of cyberattacks, small business owners should implement the following cybersecurity best practices:

  • Employee education—Workforce cybersecurity education is essential to teach employees to identify phishing attacks, social engineering and other cyberthreats.
  • Security software—A network firewall can prevent unauthorized users from accessing company websites, email servers and other sources of information accessed through the internet.
  • Multifactor authentication (MFA)—Important accounts, including email, social media and banking apps, should require MFA to limit the opportunity for cybercriminals to steal data.
  • Data backups—Essential files should be backed up in a separate location, such as on an external hard drive or in the cloud.

As cyberthreats become more frequent and severe, small businesses should take protective measures to secure all company, personal and financial information. 

Common Employee Communication Mistakes to Avoid

Effective communication is crucial to fostering a positive relationship between employers and employees. It can show employees they’re valued and heard, improving employee satisfaction and retention. Conversely, poor communication can lead to workplace inefficiencies, foster employee discontent, and create engagement and retention issues. These concerns can significantly impact workplace productivity and organizational revenue; according to a 2022 study by Grammarly and the Harris Poll, organizations lose about $1.2 trillion yearly due to ineffective communication. For small businesses, even a marginal decrease in productivity or revenue can be devastating. 

To combat the consequences of poor communication, this article provides an overview of common employee communication mistakes and discusses how small businesses can avoid them.

Benefits of Effective Communication

The purpose of employee communication is to keep employees informed. This is important at all levels, including groundbreaking business information as well as day-to-day interactions. Organizations that effectively communicate with employees may experience the following benefits:

  • Increased productivity
  • Improved retention
  • Greater employee engagement
  • Improved workplace safety and crisis management
  • Better success rates for change initiatives
  • Increased efficiency
  • Improved collaboration
  • Increased knowledge-sharing and innovation

Common Employee Communication Mistakes

Despite the significant role employee communication plays in creating successful and efficient workplaces, research indicates that many employers still struggle to convey important information to workers effectively. A 2022 report by Gallup found that just 7% of U.S. workers strongly agree that communication at their organizations is accurate, timely and open. This can significantly impact company culture, employee morale and performance. Employers can make several common mistakes when it comes to employee communication, including:

  • Providing infrequent and inconsistent communication
  • Failing to understand the employee audience
  • Providing irrelevant and impersonal information
  • Lacking a clear internal communication strategy
  • Not asking for employee feedback
  • Using the wrong communication channels
  • Overloading employees with information
  • Not measuring the effectiveness of internal communications

Improving Employee Communication

There are many ways for employers to connect with employees to enhance engagement, productivity and profitability. The most effective communication strategy is tailored to align with an organization’s and its employees’ unique goals and needs. Small businesses can consider the following guidance for effective communication with employees:

  • Identify the goal of the communication. 
  • Understand the audience. 
  • Tailor messaging to the audience and objective. 
  • Create avenues for employee feedback or questions. 
  • Measure performance of the communication strategies. 

Conclusion

Employee communication can significantly impact employer-employee relationships. Small businesses should consider how these tips can apply to the structure of their organizations. Employers who enable better communication among employees may notice improvements to their bottom lines.

Contact us today for more information.

 

Key Benefits of Return-to-Work Programs

When an employee experiences and occupational illness or injury, their eventual return to the workplace can create numerous challenges. Fortunately, return-to-work programs can help alleviate these concerns by supporting staff as they reintegrate back into the workforce. These programs may entail having an employee return to work with shortened hours, lighter workloads, or modified tasks as they continue to recover. Return-to-work programs offer several benefits to both employers and employees.

Benefits for Employers:

 

  • Increased Retention: These programs help retain valued staff and reduce the risk of turnover by allowing employees to return to work as soon as they’re able.

 

  • Lower costs: Such programs can also cut worker’s compensation costs by having employees gradually start working again and collect less in disability benefits.

 

  • Higher productivity: Having experienced staff return to work, even with reduced hours or workloads, can boost productivity more than hiring replacements.

 

  • Improved morale: Implementing a return-to-work program shows employees that their employer values their recovery and well-being, fostering a positive working culture.

Benefits for Employees:

 

  • Boosted skills: These programs can help employees maintain and enhance valuable job skills by having them return to work sooner rather than later.

 

  • Greater connections: Such programs can also keep staff more connected to the workplace by allowing them to continue the recovery process alongside their co-workers rather than at home.

 

  • Healthier mindset: These programs help foster a healthy mindset for recovering employees by giving them a sense of purpose within their daily work routine.

 

  • Reduced financial uncertainty: In many cases, employees earn more money by gradually returning to work as opposed to collecting disability benefits.

 

The Potential Impacts of a Product Recall

As a manufacturer, your customers expect you to have safe and reliable products. While you may do everything in your power to ensure your goods are fit for sale, exposures such as design flaws, manufacturing defects, inadequate warnings and unclear instructions can all negatively affect product safety. In the event that one of your products harms a customer or other stakeholder, they may sue your business, possibly leading to costly legal fees and settlements that can easily amount to six figures or more. What’s more, following a product issue, your company must take corrective actions to curb losses and preserve its reputation. This can include carrying out a product recall, which is a complex and heavily regulated process.

Product Recalls

In general, a product recall refers to the act of returning, exchanging or replacing a product in the marketplace after a defect is discovered. These defects can be anything that hinders a product’s performance, harms consumers or creates potential legal issues for producers.

In the United States, consumer product recalls are typically triggered when a stakeholder reports an issue to the Consumer Product Safety Commission (CPSC), which is the governing body responsible for developing uniform standards and addressing safety issues with consumer products. The CPSC has jurisdiction over approximately 15,000 different types of consumer products and was established after the Consumer Product Safety Act (CPSA) went into effect in 1972. The CPSA gives the CPSC the authority to pursue recalls and ban products under certain circumstances. It should be noted that the CPSC only oversees consumer product recalls; there are other governing bodies responsible for handling recalls related to food, motor vehicles and other specialty products.

If you are a manufacturer, importer, distributor or retailer of consumer products, you’re likely subject to the CPSA or other requirements. As such, it’s important to be prepared with a plan that allows your company to mobilize quickly following a

product recall, avoid substantial civil penalties and ensure long- term business success.

 

Have a Plan in Place

While recall plans are complex documents that should be created with the assistance of insurance and legal professionals, here are some tips to consider when conceptualizing your company’s plan:

  • Designate and delegate. The plan should assign employees to specific duties so that everyone knows their responsibilities in the event of a recall.
  • Keep track of production. The plan should account for proper recordkeeping. This makes it easier for your company to quickly locate and recall defective goods.
  • Use feedback. The plan should allow you to monitor customer complaints and use feedback to flag problematic products.
  • Spread the word. The plan should include a public relations strategy. You should have detailed plans in place for who will notify the public, how they will do it and when.
  • Adapt and improve. The plan should allow you to reflect on how it was implemented and make improvements as needed.
  • Consider compliance. Ensure your plan accounts for all applicable codes, regulations and industry standards.

While it’s important to have a plan in place for responding to product issues, it’s equally important to prevent future product issues whenever possible. Continual improvement should be a constant goal, and you should review your company’s communication plan, risk assessment procedures, recall strategy and similar activities on a regular basis.

 For further protection, the right insurance policy can be invaluable. For instance, product liability coverage can help protect your company from a variety of liability concerns, even if a defect is caused by an outside supplier. To learn more about your options, contact Midwest Insurance Group, LLC today.

 

Home Matters – Digging on Your Property

Home Matters – Digging on Your Property

If you are considering digging into the ground on your property, put down that shovel. Under federal and state law, all homeowners and contractors are required to notify the appropriate utility companies before doing any excavation work. Keep reading to learn more about the standards for digging on your property. 

The Dig Safe System

To help you comply with property digging legislation, many utility companies have banded together to form the Dig Safe system. 

By contacting the program, you can fulfill both state and federal requirements for notification during any digging, trenching, blasting, demolishing, boring, backfilling, grading, landscaping or other similar projects on your property. 

When using the Dig Safe system, you and any hired contractors can avoid damaging underground utilities, ensure proper equipment usage and minimize the risk of injury during the project. 

Making a Request to Dig

You can simply visit the Dig Safe website or call 1-888-DIG-SAFE to request that a service person come to your property and mark the location of underground facilities. When you call, you will be given a permit number as a confirmation of your request. 

 It is wise to contact the program well in advance of when you plan to start the project to allow for ample time for them to come to your residence and mark the utilities.

Don’t Ditch the Rules When You Dig

Notifying the appropriate parties and marking utilities before beginning any earth-moving project is not only the law—it may also protect you from a potentially life-threatening accident on your property. With this in mind, be sure to follow all local, state and federal standards in place regarding digging on your property.

Further, remember to consult your insurance agent when you make changes to your property. Doing so will allow you to adjust your homeowners policy accordingly and maintain adequate coverage. After all, as your household evolves and changes, your insurance should follow suit.

For more home safety guidance and homeowners insurance solutions, contact us today.

2024 EPL Insurance

      • Discrimination concerns—The emergence of legislation and litigation related to both size and pregnancy discrimination have contributed to rising EPL exposures over the past few years. As it pertains to size discrimination, federal employment laws prohibit adverse treatment based on a range of protected characteristics; however, these characteristics don’t expressly include height and weight. As a result, some states and municipalities have started implementing legislationMarket OutlookAmid challenging market conditions, most employment practices liability (EPL) insurance policyholders have experienced ongoing rate jumps, underwriting scrutiny and limited capacity over the last several years. Fortunately, these conditions have slightly cooled in the past 12 months, allowing for rate deceleration. According to industry data, most insureds with good claims history encountered slight premium hikes ranging between 3% and 7% in 2023. Most insureds can expect another year of modest rate increases going forward; yet, policyholders with poor loss history or who operate in certain states and industries may continue to face more substantial rate hikes. 

        Developments and Trends to Watch

        • Increased regulatory scrutiny—In recent years, the White House and the

        U.S. Equal Employment Opportunity Commission (EEOC) have collaborated on various regulatory initiatives to fight systemic discrimination in the  employment landscape. Such discrimination refers to workplace policies and procedures that can place underserved groups at a disadvantage (e.g., racial injustices and gender pay disparities). According to the EEOC’s latest report, the agency filed 143 new employment discrimination lawsuits during fiscal year 2023, representing more than a 50% increase from the previous year. As regulatory scrutiny continues to rise in the employment space, it’s crucial for businesses to maintain documented workplace policies that foster a culture of inclusivity, thus mitigating the risk of systemic discrimination lawsuits and associated EPL losses.to address size discrimination in the workplace. These changes have largely stemmed from employees across the country voicing their support for expanding protected characteristics to include height and weight. As more areas follow suit and establish similar legislation, businesses that fail to ensure fair treatment of employees of all shapes and sizes could face significant legal penalties, lawsuits and subsequent EPL losses. In regard to pregnancy discrimination, the federal government introduced two related laws at the end of 2022 that officiallywent into effect in 2023: the Pregnant Workers Fairness Act and the Providing Urgent Maternal Protections for Nursing Mothers Act. These laws have been accompanied by a rise in litigation. Specifically, media company Bloomberg found that federal pregnancy discrimination lawsuits have surged by 67% since 2016.

        Artificial intelligence (AI) issues—AI systems can leverage programmed algorithms and data sets to deliver automated employment decisions. While these systems may offer various benefits to businesses, such technology may also pose EPL exposures. For instance, AI systems could generate discriminatory employment decisions if the algorithms and data sets entered within these systems are biased toward specific groups. In 2023, the EEOC released guidance aimed at helping employers who use AI technology comply with federal fair employment laws. Along with other federal agencies, the EEOC recently issuedWhat’s more, legal experts anticipate these trends to continue in the coming years, exacerbating companies’ related EPL losses.a joint pledge to vigorously enforce anti-discrimination laws as the utilization of AI technology becomes more common. What’s more, 2023 saw the EEOC’s first AI-based discrimination settlement take place, in which a company in New York agreed to pay $365,000 after a lawsuit filed on behalf of more than 200 job applicants alleged that the company’s AI-powered hiring system was set up to automatically reject candidates above a certain age. As such, it’s imperativefor businesses to assess their AI technology for possible biases and mitigate EPL losses.

    TIPS FOR INSURANCE BUYERS:

    • Establish a staff handbook and workplace policies that address discrimination, harassment and retaliation.
    • Promote diversity, acceptance and inclusion in the workplace through routine employee training.
    • Document all evaluations, staff complaints and situations that result in employee termination.
    • Assess the algorithms for any AI systems utilized in employment processes to prevent discriminatory decisions.

Risk Insights: Construction

 Residential Construction Fall Protection Requirements

Falls in residential construction are deadly and common. According to data from the U.S. Department of Labor’s (DOL) Bureau of Labor Statistics, an average of 40 workers are killed each year as a result of falls from residential roofs—the number one cause of workplace deaths in construction. These injuries and deaths are not only costly to your company due to claims and elevated insurance premiums, they are preventable. For this reason, the Occupational Safety and Health Administration (OSHA) has explicitly stated that residential builders are not allowed to bypass fall protection requirements.  

Who is Involved?

All employers engaged in residential construction work are required to provide fall protection for workers working more than six feet above ground. Residential construction includes the following elements:

The end use of the structure being built is a home or a dwelling.

The structure is built using traditional wood frame construction materials and methods. Limited use of structural steel does not disqualify a structure from being considered residential construction.

Any employer involved in residential construction is required to comply with OSHA regulations regarding fall protection systems. This means employees working 6 feet or more above lower levels must use one of the following safety systems:

  • Guardrails and safety nets
  • Personal fall arrest systems, an example of which being a full body harness, a deceleration device, a lanyard and an anchor point.
  • Certain types of work specified under other OSHA provisions warrant alternative fall protection measures. 

What if Fall Protection is Infeasible?

When the use of conventional fall protection methods is infeasible or creates a greater hazard, employers must create a written, site-specific fall protection plan that documents why these methods are infeasible and why they would create a greater hazard.  

Contact Us

At Midwest Insurance Group, LLC, we have a variety of materials for you to ensure compliance and promote a safe workplace, which are essential components of any construction risk management program. 

Home Matters: Keep Mold Out of Your Home

Keep Mold Out of Your Home

Molds are organisms that break down animal matter and dead plants. Though most molds grow outdoors, they can travel inside by way of open windows and doors, air conditioning systems and on pets, clothing and shoes. Once inside your home, mold needs a moist food source, such as lint, ceiling tiles or wallpaper to grow. 

 Mold not only damages your property, but it can also cause serious health complications after long-term exposure. With this in mind, try these prevention tips to keep mold out of your home.

  • Clean up any water damage or flooding thoroughly and immediately.
  • Use a dehumidifier and a wet/dry vacuum to remove water quickly.
  • Remove carpeting that cannot be dried out within 48 hours. If your carpet was contaminated by sewer water or a flood, it needs to be replaced.
  • Repair basement cracks so that moisture cannot seep in.
  • Add mold inhibitors to paint.
  • Use a dehumidifier and/or air conditioner to reduce indoor moisture, especially during humid months of the year.
  • Empty the drip pans in your air conditioner, refrigerator and dehumidifier regularly to prevent water buildup.
  • Run the exhaust fan for 20 minutes before and after showering, or consider using a humidistat-controlled fan that turns off when the moisture is ventilated from the area.
  • Fix plumbing leaks immediately. Mold will begin to grow within 24 to 48 hours after a leak. 

The Complications of Mold Exposure

A mold problem can cause serious health effects—especially for young children, the elderly, those who suffer from allergies or asthma and those with prior respiratory conditions. Symptoms of mold sensitivity include eye irritation, nasal stuffiness, shortness of breath, wheezing and lung infections (in rare cases).

If you or a family member is experiencing some of these symptoms, consult a physician for a proper evaluation and diagnosis. For more home safety guidance and homeowners insurance solutions, contact us today.

Risk Insights: Manufacturing

 Manufacturing Industry Trends to Watch

The manufacturing sector consists of businesses that utilize raw materials to generate finished products. Due to the range of items this industry plays a role in producing (e.g., food and beverages, textiles, apparel, wood products, chemicals, plastics, metals, electronics, machinery, and furniture), it contributes significantly to the overall economy. Further, this sector has experienced considerable growth in recent years, largely brought on by rising production demand for various items amid the COVID-19 pandemic. 

Looking ahead, certain factors indicate the manufacturing industry is poised for continued growth in the future. Professional services firm Deloitte projects the sector’s gross domestic product (a monetary calculation of the market value of goods and services generated and sold during a set time period) will increase by 2.5% in 2023. Additionally, several federal initiatives that debuted in 2022—namely, the CHIPS and Science Act and the Inflation Reduction Act—have the potential to help keep costs under control and boost resiliency across the manufacturing sector, therefore fueling long-term industry growth.

Yet, some sector developments could pose challenges in the coming months and years, including labor shortages, supply chain struggles, economic issues, technology shifts, and environmental concerns. This article provides more details on manufacturing industry trends to watch.

Labor Shortages

The past few years have been met with labor shortages across industry lines. Furthermore, the pandemic motivated many employees to reevaluate their job expectations and priorities, thus prompting additional workforce shifts and compounding such shortages. The manufacturing sector is no exception to this trend. According to the U.S. Bureau of Labor Statistics (BLS), job openings in the industry remained near record-highs in 2022, fluctuating between 750,000 and 850,000.

In light of these labor shortages, businesses within the manufacturing sector have implemented various strategies to help attract and retain talent, such as:

  • Promoting a diverse workforce—The latest BLS data shows women make up less than one-third of the manufacturing workforce, whereas Black, Asian and Latinx employees account for an even smaller proportion. As such, some manufacturing businesses have made an effort to attract these untapped demographics and expand their available talent pools by bolstering their diversity, equity and inclusion (DEI) measures. Common DEI measures include creating workplace policies that foster an inclusive culture and offering mentorship and career-advancing programs for diverse employees.
  • Leveraging upskilling initiatives—Upskilling refers to the process of enhancing employees’ skills and promoting continuous learning by providing ongoing education, training and professional development opportunities. Especially as manufacturing businesses hire a greater proportion of new or inexperienced employees to fill labor gaps, upskilling can make all the difference in motivating these employees to keep improving upon their abilities.
  • Offering greater flexibility, pay and benefits—In response to employees’ shifting job expectations, some manufacturing businesses have adopted more competitive workplace offerings. These offerings may include flexible hours, remote or hybrid arrangements (if possible), higher pay, improved benefits and additional well-being resources.

Supply Chain Struggles

Apart from exacerbating labor shortages, the pandemic has also contributed to supply chain struggles over the last few years. This trend has made it increasingly difficult for manufacturing businesses to secure the raw materials necessary to conduct their operations, often resulting in production delays. To combat these concerns and ensure supply chain resiliency, manufacturing businesses have utilized a number of tactics, including:

  • Strengthening relationships—By building strong connections with their suppliers, manufacturing businesses are more likely to receive additional support when navigating supply chain issues. Specifically, businesses with solid supplier relationships may benefit from solutions such as modified shipment routes and prioritized access to high-demand materials as they become available. 
  • Diversifying suppliers—Instead of relying on a small selection of primary suppliers, some manufacturing businesses have added redundancies to their supply chains by investing in multiple suppliers for the same materials. With these diversifying strategies in place, businesses can increase the likelihood of maintaining access to essential production materials even if their primary suppliers are experiencing disruptions.
  • Forming local partnerships—In addition to diversifying their supply chains, some manufacturing businesses have also begun engaging in nearshoring, which entails selecting local or domestic suppliers rather than international alternatives. This way, businesses can minimize their risk of being impacted by global shipment delays and associated supply chain disruptions. 
  • Leveraging technology—To enhance supply chain visibility, some manufacturing businesses have implemented additional workplace technology. Examples of this technology include work instruction software and digital ecosystems, which are capable of actions such as streamlining supply chain workflows, ensuring frequent communication with suppliers, providing status updates on material shipment processes and delivering notifications regarding possible disruptions.

Economic Issues

The combination of labor shortages and supply chain struggles have significantly driven up the cost of goods and services in recent years, posing widespread inflation issues across all sectors of the economy. As it pertains to the manufacturing industry, inflation issues have resulted in rising costs for many raw materials, as well as their associated shipment expenses (e.g., labor and transportation costs). Consequently, most manufacturing businesses have encountered price hikes throughout their supply chains, thus exacerbating overall production expenses and forcing them to raise the costs of their finished products to ensure profitability. 

As inflation issues press on within the sector, it’s important for manufacturing businesses to curb consumer frustration regarding rising product costs by being transparent about the reasons behind these price hikes. Maintaining open communication about the impact of inflation on production expenses and providing frequent updates on how their price tags will continue to fluctuate can help businesses maintain customer trust and loyalty during these difficult times.

To help minimize overall inflation concerns, the Federal Reserve (Fed) has steadily been hiking up interest rates. Economic analysts predict that the Fed’s efforts will eventually pay off during 2023, with inflation slowly subsiding throughout the year. However, some economic experts have forecasted that rising interest rates and prolonged labor market challenges could lead to a potential recession—a prolonged and pervasive reduction in economic activity—throughout the United States in the near future. 

To prepare for a potential recession, it’s best for manufacturing businesses to consider practices such as establishing concrete financial plans, scaling back certain operations, promoting steady cash flow, ensuring proper debt management, fostering strong connections with stakeholders and leveraging effective marketing strategies. Above all, it’s crucial for businesses to maintain ample insurance in a recession and secure financial protection against possible losses.

Technology Shifts

To help offset increased expenses and productivity concerns brought on by current sector trends, a growing number of manufacturing businesses have begun utilizing smart factory initiatives. These initiatives focus on improving operational efficiencies and mitigating production costs with various technology solutions. 

Common technology solutions introduced by smart factory initiatives include 5G, the cloud and edge computing systems. These solutions are intended to help increase network capacity, reduce delays in network communication and enable greater volumes of data to be processed at higher speeds. Such solutions often permit manufacturing businesses to minimize downtime on the production floor and elevate operational performance.

In addition to implementing smart factory initiatives, some manufacturing businesses have also started leveraging disruptive technology offerings, such as augmented reality (AR), artificial intelligence (AI), the Internet of Things (IoT) and blockchain. Both AR and AI can be used to automate production processes, enhance customer service capabilities and make data-driven decisions. On the other hand, IoT and blockchain can help manufacturing businesses closely monitor their supply chains, record essential transactions, conduct predictive maintenance on production equipment, utilize advanced analytics, track inventory and assets, and detect potential safety concerns.

In any case, both smart factory initiatives and disruptive technology can pose additional cybersecurity risks. With this in mind, manufacturing businesses that leverage such technology should review their digital exposures and make adjustments as needed to mitigate possible cyber losses.

Environmental Concerns

The environmental, social and governance (ESG) landscape continues to evolve, with both consumers and regulators placing additional pressure on manufacturing businesses to ensure eco-friendly and sustainable practices. Specifically, current ESG trends in the manufacturing industry center around:

  • Decreasing carbon emissions—According to the latest industry research, the manufacturing sector accounts for nearly one-third of total greenhouse gas emissions. As such, it has become increasingly important for manufacturing businesses to aim for carbon neutrality. Some government agencies have even started requiring businesses to disclose information regarding their carbon emissions. Common emission-reducing measures include electrifying fleets, using clean power sources (e.g., wind and solar) and implementing energy-efficient smart devices on the production floor.
  • Reducing operational waste—Many manufacturing processes generate substantial waste, thus damaging the environment. Fortunately, proper waste management practices and certain types of production technology can help mitigate these concerns, promoting eco-friendly operations. 

Conclusion

Overall, there are several trends currently impacting the manufacturing sector. By staying on top of these developments and taking steps to mitigate their associated exposures, manufacturing businesses can effectively position themselves to maintain long-term growth and operational success. 

Contact us today for additional risk management guidance.

Home Matters: Decorate Safely During the Holidays

 As the holiday season gets into full swing, many families decorate to spread some cheer and make their homes more festive. While holiday decorations can be fun and beautiful, they can also present fire hazards. To keep your home and family safe throughout this holiday season, consider the following decorating tips.

  • Follow all installation and usage instructions for lighting decorations to ensure that you are not increasing your chance of starting a fire.
  • Inspect new and used lights before using them and discard any that have cracks, exposed wires or loose connections.
  • Do not connect more than three sets of lights to an extension cord at one time.
  • Plug outside lighting only into a ground fault circuit interrupting outlet, as this will safeguard the outlet from any interaction with water.
  • Do not secure outside lights with staples or nails, and avoid placing indoor extension cords under carpeting, rugs and furniture.
  • Unplug lighting decorations before going to bed and leaving the house.
  • If you set up a Christmas tree, place the tree in a sturdy stand at least 3 feet away from heat sources.
  • Only keep your Christmas tree for two weeks, because it will dry out quickly and can become highly flammable. 

Be Careful With Wiring

If you blow a fuse while decorating, discard the faulty light string or decoration and replace the blown fuse. If the fuse blows again, contact an electrician to investigate the problem further. This might indicate a more serious wiring problem in your home. 

For more home safety guidance and homeowners insurance solutions, contact us today.