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As a condominium unit owner there is a specific insurance form for you. The HO-6 policy is for unit owners. It combines both property and liability insurance in a single form. The unique areas of the form are related to property coverage, and this is where the details matter.   Building Coverage You obviously do not own the entire building, but the values that you must protect can vary based on the wording of your association by laws. Bylaws can vary the responsibility of the association for items in your unit. An “all in” clause in the bylaws would make the association responsible for all of the interior finishes, appliances, and wall and floor finishes in your unit. Other bylaw provisions may make anything from the studs or drywall out your responsibility. Some bylaws may read as “all in” but the association insurance is designed to replace “building standard” equipment and finishes. If you have upgraded, the increased cost is your responsibility. This can be a challenge for new owners who are buying an existing unit. Not knowing the “building standard” may make choosing limits more challenging. We ask our clients to provide us with a copy of the bylaws of the association so we can read the clauses in question and offer our counsel on your needs. We make these observations as “only pay for what you need” and “15 minutes will save you 15%” do not help you with these decisions. You need an experienced insurance professional to guide you to a sound choice. Contents Coverage This is the value of the personal property you have in the unit. We recommend that our clients do a periodic inventory with video of their contents. This will help you identify things that have been added or deleted since the last time you set this value. Do not neglect property in off premises storage units. Your form may offer a sub-limit or a percentage of the contents limit for this exposure. Knowing the values exposed will clarify if standard policy terms are effective for your needs. Loss of Use In the event that your unit is not able to be occupied due to a covered cause of loss, you may be able to claim loss of use to recoup expenses for alternate living space. Different insurance companies have different ways to set this limit. The important issue to consider is how long should you project for loss of use coverage needs? A large loss at your building could easily cause more than a 12-month period for you to be away. Policy language should be specific that the time for loss of use can exceed the term of the policy. Our staff understands how our carriers arrive at this limit and can help you select the correct coverage for this expense. The cost to get the right limit is a pittance of the costs of not having enough coverage. Loss Assessment In addition to knowing the details of your insurance program, you need to know the details of the master insurance program for the association. We would like to review both the bylaws and the master policy information as part of our due diligence.   These policies will have deductibles that are the responsibility of the association. The bylaws will allow the association to recoup these dollars via a loss assessment. You need to know the deductibles that apply to the master policy. Keeping in mind that there can be several different deductibles. A wind and hail deductible is common. This can be a fixed dollar amount or a percentage of the building’s value. There may be a different deductible for water damage, flood, and earthquake claims. The standard policy deductible will apply to all other perils.   The bylaws will describe how this assessment will be calculated. It may have all unit owners share in the expense, or it may have the deductible applied to the units involved in the loss. For a roof claim on a single building, the deductible could be shared by the owners in that building. Knowing the potential amount of this deductible and your share is key to setting the right limit.   Master Policy Valuation Clauses In addition to peril specific deductible there can be peril specific valuations. For buildings with older roofs, the insurance carrier may apply an actual cash value (ACV) to the property. This will reduce the recovery and raise the potential loss assessment charge. To reduce premiums the carrier may change the entire policy to ACV from replacement cost (RC). Fannie Mae and Freddie Mac have rules that limit their exposure to ACV coverage. They have a database of master insurance policies that have ACV language in them, and you may find that getting a mortgage or refinance a mortgage through these sources is difficult if your association has ACV language in the master policy. Syncing your policy with the master policy One strategy to consider is having your HO6 with the same insurance carrier as the master policy. If you have the right limits in place, any issues are then an internal debate at the insurance company. Which of the two policies will cover this loss? If you have a different insurance company, then it is which company can avoid the claim. While syncing may seem to be a bother, it may make life a lot easier at time of a claim. The Driehaus Difference We deal with these issues every day and are familiar with the various terms used in bylaws. We also know the structure of a master policy and how to interpret what forms are attached to the policy. We want to be your insurance provider. Our experience and expertise will help you get the most comprehensive and cost-effective insurance program. Call us at 513-977-6860 or use the contact tools on our website, www.driehausins.com .

Enhanced Reporting Program Establishments with 100 or more employees in designated high hazard industries listed in Appendix B to Subpart E of 29 CFR 1904 must electronically submit to OSHA detailed information about each recordable injury and illness entered on thier previous calendar year's OSHA form 300 and Form 301. You can check to see if this new requirement applies to you at https://www.osha.gov/itareportapp This includes the date, physical location and severity of the injury or illness; details about the worker who was injured; and details about how the injury or illness occurred. The new data will help OSHA and third parties such as prospective employees and research groups to more clearly define hazards and controls that can improve workplace safety. There will be controls on the data to prevent any reports from identifying a specific individual. Reporting Requirements OSHA requires that employers with 10 or more employees maintain records of serious work-related injuries and illnesses. Some low hazard employers are exempted from this regulation. Click for a list of exempt employers . Minor injuries requiring first aid only do not need to be recorded. Reporting Serious Injuries – All employers, regardless of size or industry must report any worker fatality within 8 hours and any amputation, loss of an eye or hospitalization of a worker within 24 hours. These events can be reported online or by phon e . Maintaining and Posting Records – OSHA logs and supporting records must be maintained at the worksite for a period of five years. Each February through April the employer must post a summary of injuries and illnesses recorded during the prior year. This form is part of the OSHA 300 form set. Fillable forms are online at the OSHA web site, click here . Electronic Submission of OSHA 300A Data – Any employer with 250 or more employees must submit their OSHA 300A summary data to OSHA electronically. There is a list of establishments that must also report their 300A summary data to OSHA. These establishments will report if they have 20 or more employees but less than 250 employees. The Injury Tracking Application (ITA) is accessible from the ITA launch page , where you can provide the Agency your OSHA Form 300A information. There are new sign-in procedures since October 2022. The above link will help you navigate these changes . The date by which the above noted employers are required to submit to OSHA the information from their completed Form 300A is March 2nd of the year after the calendar year covered by the form. Incident Rate Calculations – Your OSHA 300 data has some of the values needed for calculating your total incident rate and your days away, restricted or transferred (DART) rate. You can download fillable PDF form s from OSHA. A detailed calculator that allows you to benchmark your business against both state specific and national trends can be found at the Bureau of Labor Statistics calculator . Incident and DART rates are often used in qualifying contractors and suppliers for bids. Making sure your data is sound for these calculations can be an important step in qualifying for some business opportunities. The incident rates may be used by insurers when evaluating workers compensation and general liability exposures. Companies that have a higher than average injury rate or a higher than average rate of serious injuries as indicated by the DART rate may have less attractive terms and conditions for insurance coverage. First Aid Only Cases – OSHA requires that only serious injuries or illnesses be recorded. There are criteria to define a first aid event. You should be familiar with these requirements and use them in your recordkeeping process. It is not in your interest to have incidents that are not recordable on your OSHA log. Click here for the OSHA first aid definition The Driehaus Difference Insurance without risk management is only a partial solution. We understand the insurance marketplace as well as the OSHA rules, recordkeeping and how this data is used in business and insurance. If you need help, we have the expertise and resources to help you manage this important information. Visit our website at www.Driehausins.com or call our office 513-977-6860 to contact us. We look forward to helping with your risk management program.

Social media and the news feeds are full of stories with insurance companies cancelling policies. This headline makes for a strong click rate and generates a lot of heated commentary. As with many insurance related topics, the words have specific meaning, and the real story is not always as dramatic as the headline.    Cancellation  An insurance policy can be cancelled by either the insured or the insurance company. There are a few limitations on the cancellation by the insured. There are state laws and regulations that dictate the insurance company’s actions. Written notice is provided to the policyholder.   Why would a company cancel my policy?  The most common reason for policy cancellation is nonpayment of premium. The company may offer a short grace period, but if they are not paid, the policy will be cancelled.  Misrepresentation or fraud on behalf of the insured is a reason for cancelling coverage. Concealing or misrepresenting information on the application for coverage is grounds for cancellation.  Changes in risk – a new product, process, or new business venture can cause a cancellation if the level of risk rises.  This can include non-compliance with risk control recommendations. Violation of policy terms – improper conduct during a claim investigation or discovery of change in operations that are outside of the current policy are grounds for cancellation. Using vehicles for business use when they are rated personal use only is an example.    The key element of each of these situations is an action, omission or change that the policyholder creates or initiates. Your insurance contract was based on information you provided at the time of application. Inaccurate information that changes your risk level is grounds for the carrier to cancel.    Most states require a short notification period of the cancellation. The most common is ten (10) days. In some states the ability of the insurance company to cancel for underwriting reasons may be limited to a short time after the effective date of the policy. After that date, the non-payment of premium or violation of policy conditions are the reasons available for cancellation.    Non-Renewal   An insurance company may decide not to renew policies based on a wide range of business issues. Written notice of the non-renewal is sent to the policyholder.    Non-renewals by the insurance company may relate to not wanting to write a specific coverage line; limiting the geographic area of coverage, claim frequency can be a cause for non-renewal and changing market and economic conditions that affect the insurance company.     In the case of wildfires the geography, line of coverage and economic factors are outside the control of the policyholder but impact the insurance company. It is in everyone’s interest that insurance companies are financially stable. The distribution of risk is impacted when fewer players are in the marketplace.    The only factor that is in the control of the policyholder is loss frequency and severity. If you are unprofitable and there is not a reasonable path to changing that experience, you can expect to be non-renewed.    State regulations call for a longer notice period of non-renewal, often a minimum of thirty (30) days before the expiration of the policy.   Impact of Cancellation     The first impact is that coverage will be lost. The cancellation is immediate at the time and offers you a short time to take action. The non-renewal will offer a greater window of time to make new coverage arrangements.    A cancellation can make obtaining new coverage more difficult. The first question on most insurance applications regards your history of being cancelled or non-renewed. Omitting an answer or offering a false answer to this question could be considered material misrepresentation and grounds for the next cancellation.    For cancellations, the policy will have provisions for returning premiums if cancelled. Consult the policy for the premium refund calculation process.   Impact of Non-Renewal  You will have more time to market your insurance program. Non – renewals come with at least 30 days advance notice. It is possible that your agent knows about the impending non-renewal in advance and can proactively market your business.    Other than claim history, the other reasons for non-renewal are outside of your control. Other carriers will know what is happening in the marketplace and will have a position on the circumstance that prompted the non-renewal.      Applications will ask about non-renewal status. Omitting the answer or providing false information is not a good idea. Every insurance company makes business decisions and those do not reflect on the individual policyholder.   What to do if you are Cancelled or Non-Renewed   Call your agent immediately!  In some cases, your agent may be able to get the decision reversed. Waiting until the policy is no longer in force limits your options and the ability of an agency to change decisions.    Prepare to market your insurance program. Updating exposure information, vehicle lists, drivers list, payroll and sales information will make the marketing process smoother and more successful. Incomplete or missing information creates delays in a time when time is short.    If the non-renewal is based on losses, be prepared to detail how the circumstances that created the losses have changed and the insurance company can expect better results. If the reason is data from a third-party provider such as roof surveys, have facts and documentation available to respond to the issue.    The Driehaus Difference  We carefully monitor the appetites and market direction of our insurance companies. We can be ahead of the curve when a carrier starts to signal a change in appetite or coverage availability. We can help you get ahead of the decision. For cancellation we can ask for the carriers to offer another chance. In the case of nonpayment of premium, you may need to premium finance the balance to remove the credit risk from the insurance company. We will need accurate and timely responses to make a case for a change by the insurance company.    We live in this industry and can help you navigate the sometimes choppy waters of the insurance marketplace. We want to be your insurance provider, so call us at 513-977-6860 or reach out to use via our website at www.driehausins.com

The ongoing wildfires in southern California have highlighted this hazard and the tragic results brought international attention. The damage estimates will top $50 billion dollars, making this the second most costly event behind Hurricane Katrina. Katrina affected four states, these fires affected one county. Wildfires were previously called forest fires, and they were a rural event. As time went past the fires were now burning in the wildland urban interface. This was where the forest met the developed areas. It was still considered to be a more remote area of impact. Fires recently have moved into decidedly urban environments. Lahaina, Hawaii, 2023 — A wildfire-started conflagration that killed 98 people and damaged or destroyed over 2,200 structures Marshall Fire, Colorado, 2021  — A fire that started conflagrations in Louisville and Superior, Colorado, killing two people and destroying 1,084 structures Almeda Drive Fire, Oregon, 2020  — A fire that destroyed 2,600 homes and killed three people in the communities of Phoenix and Talent Camp Fire, California, 201 8 — A fire that killed 85 people and destroyed 18,804 buildings in Paradise, California Gatlinburg and Pigeon Forge, Tennessee, 2016  — A fire that killed 14 people and destroyed 2,460 structures These events have losses similar to the Great Chicago Fire of 1871, the 1906 San Francisco Fire, and the Great Fire in Baltimore in 1904. These conflagrations gave rise to the Public Protection Class tool used by insurance companies. This rating scale of 1- 10 with 1 being the best measures the fire department’s ability to resist a major urban conflagration. It focuses on the ability of the fire department to control fires within a given area using conventional apparatus, staffing, communication, and water supplies. LA City FD is ISO 1, and LA County FD is ISO 2. The fire department and water supply were judged to be above average by the PPC scores. Property underwriting evaluates a single building with adjacent exposures. The assumption is a single fire. The wildfires do not behave in this predictable manner. There can be dozens of fires at the same time with wind driven brands starting fires well in advance of the front line. Traditional firefighting methods, traditional water supply calculations and traditional insurance underwriting all fail to manage this situation. This is fueling the crisis status of California property insurance. This trend indicates that the traditional methods used to control conflagration are simply not effective. Whether the issues are climate change, space lasers or just bad luck, the trend cannot be ignored. Unlike hurricane events where flooding is often not a covered peril for property insurance, these events are covered by property insurance. Our July 2023 article on Wildfires , indicated the increased use of wildfire hazard scores. This is a function of fuel type and quantity, slope, and weather conditions. The biggest variable in this process is weather, so the computer models run thousands of simulations to adjust for weather variability. This process is documented in FEMA National Risk Index. This index was updated in March 2023. Various groups have built upon this methodology to create brushfire scores for properties. Using overhead images and machine learning and artificial intelligence to interpret the slope, vegetation, distance to structures and exterior construction of the building generate a score. This is the foundation of many cancellation notices. While this shows immediate action, it does not address the underlying issue. You cannot cancel your way to profitability. To make money, insurers have to write business and transfer risk. There are solutions to this problem. There are long-established standards for making properties more resistant to wildfire. They involve the use of non combustible building materials on the exterior of structures, use of windows that resist fire damage, managing the space around the building to limit fuel near the building and improving ember resistance to all exterior ventilation openings. The rebuilding of the fire damaged areas would be immediately improved if building codes were updated. Past experience shows that getting major changes to the building code is an exceedingly long process. Past fire experiences in California have not prompted this type of change in code language. Pressure from insurers has been more effective in moving the needle towards a fire safe structure. Community planning that increases distances between buildings, adds defensible breaks within the community would also reduce the conflagration hazard. Using more land as public spaces that create separation and firebreaks is also an effective tool for resilience. The cost is lower density of taxable structures, so this is a non-starter. Personal planning to use static water sources such as pools or water impoundment systems for rainwater and greywater would be advantageous for individual owners to upgrade their fire protection with exposure sprinkler systems supplied from these water supplies. This would take strain off of the municipal water supply. Some insurers are advocating for these improvements via lower deductibles and being an available market for high value homes. The wildfire hazard has evolved from a Smokey the Bear environment to Malibu. The genie is out of the bottle and unless targeted actions are taken to reduce the risks, these events will repeat. Insurance in its traditional form and structure cannot support the loss dollars these events create. It is not probable that the banking world will allow a wildfire exclusion for property policies. This would shift the risk to the mortgage holders. That is untenable. Insurers simply exiting the marketplace is untenable. The exposure must change and that means building codes, community planning and individual risk reduction efforts will be needed. Watch as the reviews of this event are conducted. Each group involved will suggest they need more of their product. More fire department resources, more water resources, and more insurance responses such as high rates and deductibles. Each group wants to keep using the tools they have. A wise man once told me “If you only have a hammer, everything looks like a nail.” Swinging each group’s hammer will not solve this problem. We have a short memory for tragedy. The speed at which new tragedies occur make the last one forgettable. Unless we acknowledge that wildfire is not a California hazard and is represented across the nation, it will be playing “whack-a-mole” with this exposure. The Driehaus Difference We have observed underwriting decisions based on wildfire exposure creeping into the local market. We monitor these underwriting trends and use that knowledge to help our clients find the right markets for their property insurance. Reach out to use at 513-977-6860 or use any of the contact tools on our website, www.driehausins.com We want to be your insurance provider.

Scope of Noise Exposure The number of advertisements about hearing aids should tell you that hearing loss is a common issue in America. Estimates are that 48 million Americans have some degree of hearing loss. About 5% of adults have a hearing loss that could be classified as disabling.   Hearing loss is considered to be a disability as it affects your normal life activities. Hearing loss is permanent and cannot be restored. Noise is an exposure that exists outside of work and in many cases, there are exposures outside work that are more intense than workplace noise levels.   The Occupational Safety and Health Administration, OSHA, has had occupational noise exposure standards in place for decades. This standard applies at work to offer a minimum level of protection against hearing loss.   The American Conference of Governmental Industrial Hygienists, ACGIH, has a noise exposure that is more conservative than the OSHA standard. The National Institute of Occupational Safety and Health, NIOSH, has also published their recommended exposure limits, REL, for noise in the workplace. NISOH provides research for OSHA to consider in its regulation process. Noise Basics Noise is the presence of sound pressure levels that can be heard by the human ear. Sound pressure is measured in decibels. Noise can be further characterized by the frequency of the noise. High frequency noise is higher in pitch to the human ear. Lower frequency noise can be heard and also felt. If you have been next to a car at a traffic light you may both hear and feel the bass from the other vehicles’ sound system.   Noise acts on the hair cells in the inner ear. High noise levels can cause a gradual and permanent hearing loss. The higher frequency noises are the first to be affected. The loss of hearing acuity can be difficult on normal living and relationships. It can also be a hazard when you cannot hear warning signals.   To control this hazard, OSHA and NIOSH have developed tables that indicate the acceptable time for exposure to various noise levels. These tables are based on a specific set of noise frequencies that are most susceptible to hearing loss. This set of frequencies is the A scale, and the measurements are expressed as dBA to reflect A scale weighting. A third-party group, the American Conference of Governmental Industrial Hygienists, have also published their own noise exposure standards that align with NIOSH recommendations. Exposure Limits  A 100% noise dose is a calculated value based on measured noise levels and the time you are exposed to that noise level. OSHA shows its noise dose as a Permissible Exposure Limit, PEL. NIOSH shows its noise dose as a Recommended Exposure Limit, REL. The 100% noise dose is the maximum level of noise that is safe for exposure. As the noise level, in dBA, increases, the time to reach 100% dose decreases.  PEL and REL are represented by a Time Weighted Average, which calculates noise dose based on exposure levels in dBA and time that the exposure existed.   The table below shows the variance in OSHA regulations and NIOSH provided research-based exposure limits. Time to reach 100% noise dose Exposure level per NIOSH REL Exposure level per OSHA PEL 8 hours 85 dBA 90 dBA 4 hours 88 dBA 95 dBA 2 hours 91 dBA 100 dBA 1 hour 94 dBA 105 dBA 30 minutes 97 dBA 110 dBA 15 minutes 100 dBA 115 dBA To put these noise levels into context, here are example sources that generate the noise levels 85 dBA is equivalent to a loud restaurant dining room. 85 dBA – 89 dBA – Hair dryer, blender, power lawn mower, vacuum cleaner, snowblower, garbage disposer, propeller plane 1,000 feet above you 90 dBA –100 dBA emergency siren, pneumatic drill, diesel truck, gas leaf blower, pressure washer 105 dBA – 110 dBA – Rock concert, pile driver, gas hedge trimmers Over 110 dBA – commercial jet take off, civil defense siren Most woodworking tools are typically in the 90 dBA to 102 dBA range. Gunfire noise levels can range between 140 dB – 190 dB    Many smartphones have noise measurement apps available. TWA measurement requires a dosimeter or a detailed spreadsheet to record noise levels across time. The average level calculated by these apps is not a true TWA, but an average should be viewed in context of the time it represents to see if the levels are higher than the above table values for that period.   A good rule of thumb is that if you need to raise your voice to be heard over any noise, the noise level can be high enough to cause hearing loss.   Example noise sources are present in our homes and hearing loss is not solely an occupational issue.   The first step in controlling your exposure to noise is recognizing the hazard. If you do not recognize the hazard, you will not take precautions to protect yourself from the long-term damage from hearing loss. The Driehaus Difference We recognize that noise exposures are not simple a workers compensation issue. Hearing loss affects your life and your ability to enjoy everyday experiences. There are noise exposures outside of work that can cause hearing loss. Recognizing the signs of a harmful noise exposure allows you to make choices. Those choices are the topic of the next installation of this article, the controls that can be applied these noise exposures. Call us at 513-977-6860 or reach out using the contact tools on our website, www.driehausins.com . We want to be your insurance provider.

Control options Once you have identified a noise exposure, you need to manage that exposure. Within the safety field we consider a hierarchy of control methods for a given hazard. Elimination — If it is possible to remove the noise source, which would be the most effective strategy. It is not always possible to do.   Substitution — Changing the noise source to a quieter option. Replacing gas powered lawn equipment with electric lawn equipment is an example of this solution   Engineering Controls — You may be able to isolate the noise source by enclosing it, adding sound barriers, sound absorption material or relocating the noise source to an area that is not occupied. Placing a noise source outside the work area is an effective engineering control   Administrative Controls — can be purposely limiting the exposure time for any person to a level below what the noise standards indicate can cause hearing loss. Putting time limits on noise producing activities can be effective at reducing your exposure. Administrative controls may also include subcontracting the work to a third party. If you do this, you have a duty to warn the other party of the hazard that is present on your premises. If the subcontractor supplies the equipment that produces the noise that was not otherwise present on your premises, the subcontractor will have primary responsibility to protect the hearing of exposed workers.   Personal Protective Equipment (PPE) — provides the exposed person with protective devices that they wear to prevent exposure to hearing loss. The devices can be widely grouped as in ear products, plugs, inserts and over the ear products, headphone, and muffs. This is the most common method of reducing a person’s exposure to noise. This is also one of the least predictable controls as it relies on consistent use and care of the device. Image courtesy of Michael Pittman – NIOSH   Selecting Hearing Protection   To be effective the hearing protection must be properly fitted, worn properly, and worn whenever they are exposed to a high noise level. PPE used for noise protection are rated with a Noise Reduction Rating (NRR). This is a number that represents the level of noise reduction that the PPE provides. If the product does not have a NRR assigned to it by the manufacturer, it should not be considered an appropriate device for personal protection.   If you know the sound level for the work area in question, you can estimate the effectiveness of the PPE by subtracting 7 from the NRR and that result is subtracted from the measured noise level. This would approximate the noise level under the protective device.   Example – Consistent use of lawn mower - 89 dBA- ear plugs with NRR of 29 would have the 89 reduced by 22 to 67dBA. This should be an effective choice of hearing protection.   For extremely high noise exposures such as gunfire, you may use both in the ear and over the ear hearing protection. You cannot add the two NRR ratings together for a higher NRR. T he OSHA Technical Manual allows employers to add 5 dB for the second hearing protector. An example: if wearing an earplug with an NRR of 25 together with an earmuff (also with an NRR of 25), expect a combined NRR of 30. Keep in mind, however, that this rule of thumb is a general estimate.   Use of noise cancelling headphones may be effective if the device has a NRR figure from the manufacturer. If the headphones do not have a manufacturer supplied NRR, they should not be relied on for hearing protection. Use the method above to apply the NRR to the noise exposure to evaluate this type of hearing protection.   Earbuds, headphones, and music to mask noise is a poor choice. You may be compounding the exposure by having a high energy noise source in addition to the environmental noise exposure that already existed. Substituting one high level noise for another does not improve the situation.   Fitting hearing protection To be effective the hearing protection must properly fit the user. Many foam-based products are one size fits all. There is a specific method to insert these foam devices in your ear. The Centers for Disease Control CDC describes this as the Roll- Pull and Hold method.   Roll the earplugs up into a small thin “snake” with your fingers. Pull the top of your ear up and back with your opposite hand to straighten out the ear canal. The rolled-up plug should slide right in. Hold the earplug in place with your finger until it expands to fill the ear canal. Your voice will sound muffled if the plug makes a good seal.   You must use this method to properly get the benefit of in the ear hearing protection.   The Driehaus Difference Most of the major workers compensation carriers have programs to assist clients with hearing conservation programs. We can help you identify the resources needed to measure noise levels, set up a hearing conservation program and protect your interests with the right insurance program. Call us at 513-977-6860 or contact us via our website at https://www.driehausins.com / . We want to be your insurance provider.

If you are doing a large renovation or addition to your existing home, you will obviously need to report the increase in values at completion. But what type of insurance is needed during the course of construction?  The answer may depend on from whose perspective you view the risk.   Contractor Perspective If you have a contractor doing the renovation of addition, they may carry a builders’, risk policy or an installation floater policy on the values of their work. This type of policy insures not only the materials, but also the labor and profit associated with the project. This protects the contractor, but these policies typically have an exclusion for the existing structure, so your home is not insured under these programs. The contractor is covered for his interests, but you may be left in the cold at claim settlement time. Since you are not the policyholder, you do not have any control over the claim process or have any ability to influence coverage terms and conditions. Ask to be named as an additional insured on the contractor’s policy. If possible, obtain a copy of the policy declaration page and share that with your insurance agent. The dec. page will have form information so a review of policy terms could be undertaken on your behalf.   Homeowner Perspective Option One – Existing Homeowners’ policy You can report increased values to the insurance company at the beginning of the project. This would seem to offer the homeowner coverage on the same terms as the existing policy during the course of construction. This is a practical approach if your insurance carrier blankets coverage for real and personal property. In this case there will not be a gap for the difference between real property values and personal property values.   If your policy has separate limits for real and personal property, reporting these values is the complicating factor. If you report all of the values as an increase in building value, you may create a coverage gap. The gap in this coverage may be for materials that have been ordered and not yet installed. If your custom woodwork or materials that are off premises are stolen or destroyed, you may not have coverage for off premises materials.   You would need to cover the project by separating items between real property and personal property to have off-premises coverage. Since installed materials would then be considered building values, this is a difficult balancing act. It would require significant recordkeeping; multiple policy changes and your personal lines carrier may not be happy with the extra processing. Their displeasure may be expressed at renewal.   In either case, covering the course of construction on a homeowner’s policy will also highlight the change in risk when construction activity is underway. Some insurance companies see this as a significant increase in risk and will apply a surcharge to your homeowner’s policy for the duration of the project. We have seen surcharges approaching a 100% increase in premium for the term of the project. In addition to an ongoing accounting and value endorsement process, you will be paying a substantial cost for this coverage. Understanding this additional cost is important to evaluate if a separate builders’ risk policy would be advantageous.   Option Two – A Builders’ Risk Policy We always recommend to our clients that they place the builders’ risk or installation floaters for thier property. This way we know the terms and conditions of each program and can have some control and input to the claims handling process. You may be able to secure a builder’s risk policy from your homeowners’ carrier. It will be from another part of the company but would allow better coordination of coverage and claims handling. If your personal lines insurance carrier does offer a builder’s risk or installation floater, consider a monoline inland marine carrier.   There are monoline renovation inland marine forms that would allow you to insure the existing building during the course of construction. You would need to keep your homeowners in place for contents coverage, but you may find the premiums to competitive and the coverage more comprehensive that trying to adjust your building and contents limits on a homeowners’ policy during the project term.   A monoline policy may be subject to a minimum premium charge. Knowing the potential upcharge for your homeowner’s policy will allow you to determine if the minimum premium charge is cost competitive.   The Driehaus Difference We have helped our clients navigate these scenarios and can help you make the best choice for coverage and cost. There is not a one size fits answer to this situation. The ongoing construction process needs to be properly insured and the cost effectively controlled.  We have learned this and can use our experience to protect your interests.  We want to be your insurance provider, so call us at 513-977-6860 or contact us online at www.driehausins.com

You see a lot of commercials selling service line protection. You may also get official looking mailers that ask you to sign up for this type of program. Before you sign up for this, here are some things to consider. Limits can be low These products have specific limits for each type of service line or home system covered by the program. A review of a major provider’s product indicated separate limits for different home systems and service lines. The limits were a maximum of $5,000 per incident / annual aggregate. Limits for some exposures were less than this figure. For underground lines a $5,000 limit was also applicable to opening and closing public streets and roadways. Depending on the type of pavement present, this could be insufficient for the repairs. Claims handling You may be obligated to use the service line recommended contractors to do the repairs. This removes control over the claim from the customer. If you ask for a second opinion, any costs related to providing that second opinion are deducted from your per event limit. If you engage your own contractor to make repairs the program may not respond to those costs. If you dispute the claim settlement you have to choose between small claims courts or binding arbitration. The small claims court is to limit the size of any recovery. One agreement even had a hammer clause that if you disputed the settlement and the outcome of the settlement was less than the original offer, you paid the legal fees for the service line company. Cost These programs are priced by zip code, and not with any real detail on the property being covered. There is no rating worksheet provided so you cannot see how the premium was developed. This is not insurance These programs are a warranty program, not insurance. There may be a surety company standing behind the program who would step in if the warranty program fails to perform, but there are steps to follow and time frames related to determining a default by the warranty company. You do not have the protection of state regulators as with admitted insurance companies. Your Homeowners Policy Personal lines insurers are offering service line coverage on some comprehensive homeowners’ forms. A previous article on homeowners forms, What's in the form?, discusses the different homeowners coverage forms. One carrier offers a $25,000 limit for this exposure and the claim handling and settlement terms are the same for the balance of the policy.  The cost for this is imbedded in a broadening endorsement that has other coverage extensions.  This is a better limit, cost and claim situation for you. The Driehaus Difference We take time to help you understand the options that are available to you in protecting your home. We can help you find the right carrier, the right policy forms, and the most competitive costs. We do not provide prices based solely on your zip code. We need to spend some time with you to understand your exposure to loss and how we can build a program to protect your interests. This is not a “fifteen minutes will save you 15%” undertaking. We are willing to invest our time and expertise to help you. You need to invest your time in sharing information with us to get you to the right insurance program. Call us at 513-977-6860 or use the contact tools at www.driehausins.com to get the process started. We want to be your insurance provider.

The roof of your home protects your possessions from wind, rain, snow, ice, hail, and fire. Roofing constitutes about 7% of the total building cost of the home with the roof covering accounting for ½ of that amount or 3.5% of the cost. This is a big-ticket item when it needs to be replaced, so choosing the right material is essential for your safety. Shingle roofs constitute the majority of residential roofs. Insurance and shingle roofs The insurance industry has a love / hate relationship with roofs. They love it when the roof does what it is designed to do and prevent a loss. They hate it when there are roof problems that allow water intrusion, wind uplift, ice dam formation, collapse from snow loads and allow fire spread. Insurance company roofing related actions Roofs represent a major loss source for insurance carriers, and they are taking steps to control their exposure to loss. The use of aerial imagery that is reviewed by an artificial intelligence program to score your roofs condition is now common. Every insurance company has their own internal processes to evaluate this data. Your score from this process can determine the deductible offered and if coverage is extended at all. There may be an age-related factor that will be considered in the decision-making process. If you do not know the age of your roof, you are at the mercy of the third party estimate of age. Insurance companies are frequently applying a percentage deductible or a higher dollar deductible to roof and wind claims. The percentage deductible is based on total building value, so it can be a substantial amount for a deductible. Another direction for handling roof exposures is to apply Actual Cash Value (ACV) on roofs over a specific age or that meet a certain scoring threshold in the third-party evaluation. Appealing the insurance company decision Since the roof evaluation is automated, the person handling your account may have no input on the decision reached. Overruling the third-party data may require a lot of documentation about your roof. This data should include date of installation, installer, name of shingle manufacturer, name of shingle product to allow verification of properties for this product. Many homeowners cannot produce this level of documentation on demand. Evaluating roofing shingles for your home The first consideration for roofing materials deals with appearance. Shingles are available in flat three-tab, architectural shingles that have an additional layer of material and architectural shingles that are intended to mimic the appearance of a wood shake roof or a slate roof. Based on the desired appearance, you move into varying price points for the shingles. A review of literature from a major shingle roofing manufacturer and the distinct types of shingles they offer and the variation in warranty, wind uplift, hail resistance and styles available are shown below. A previous article on roofing warranties discussed the typical terms in these warranties and how it impacts insurance claim handling. Many warranties depend on the roofer using all products from the manufacturer of the shingle. This can include underlayment, starter strips, hip, and ridge shingles. Warranties can also require a certified installer. Warranty terms may vary based on the price point of the shingle selected. Wind uplift is a significant performance point for your roof. The higher the roof uplift rating, the better your roof can resist shingle loss in a storm. While the building code has minimum requirements, a code review may not be conducted.  Many roofing projects are considered maintenance, so no building permit and related inspections and reviews are performed. Your agreement with the roofer may shift the responsibility of securing any needed permits to the owner. If this is the case, check with your local code official for their regulations. If there is no code review by the building official, you should ask for the highest wind uplift that is available for your chosen product. A higher wind uplift rating may be available using a six nail per shingle installation versus a four nail per shingle installation. Some shingles show two uplift speeds depending on installation processes. Ohio has a base wind uplift speed of 90 MPH. If you live in an area that is prone to hailstorms, we recommend installing impact-resistant shingles that are designed to withstand greater levels of impact. Impact-resistant shingles are evaluated and classified using the Underwriters Laboratory 2218 (UL 2218) steel ball test where a steel ball is dropped from a specified height onto an installed roofing shingle and inspected for any breaks or cracks. The highest possible rating is Class 4. To receive a Class 4 rating, a roofing shingle must withstand having a 2-inch steel ball dropped multiple times from a height of 20 feet. Using Class 4 impact resistant shingles helps to prevent or reduce the amount of damage from hail or other debris. Color Matching One common issue when a roof claim is being adjusted is the availability of shingles that are dimensionally and color consistent with the  existing roofing. A best practice is to secure a supply of the original roofing shingles and retain them for future repairs. You can specify a specific quantity such as 2 bundles in the bid for your roof. Having some additional shingles could make repair much easier in the future. Ask the shingle manufacturer about any shelf-life restrictions for their product and storage requirements. Different states have different rules regarding matching of exterior finishes. Some insurance carriers may offer a specific endorsement to provide funds for exterior matching of materials in the event of a claim. Documentation to be collected and retained There is a lot more to a shingle roof than appearance. You need to document and retain the following: Material specifications for all roofing components. This includes shingles, underlayment, starter strips, ridge and hip shingles, ventilators, and flashing. Date of installation Name of the installer and any certifications they hold in relation to your roofing materials. Proof of warranty registration You may need these details to appeal a third-party evaluation of your roof. The Driehaus Difference We track the underwriting and inspection practices of our insurance companies. We can help you select a company that will work with your specific roofing situation. We can also helps gather the data needed to get the best treatment from the insurance company for your roof. We can also assist in reviewing any contracts you may be considering for a roofing installation. We are focused on providing feedback on risk transfer and any insurance-related needs that may arise. Call us at 513-977-6860 or contact us via our website at www.driehausins.com . We want to be your insurance provider.

Driving safely is a full-time job. Many believe the car is another place to do business, return calls and answer texts and questions. When we take attention away from driving, we increase our risk of a crash. Recent changes in state laws have focused on the distraction from using smartphones when driving. It is estimated that 1 in 7 traffic accidents are related to distracted driving. Over $400 billion dollars are lost to distracted driving accidents What causes distractions? Distraction falls into three distinct categories – each category of distraction alone is a hazard. Some activities have multiple categories of distraction. Hands – This is when you are manually using your hands to adjust controls on the radio, comfort system, reaching for an item or manipulating a device. Your hands are not on the wheel and often your attention is now directed at the manual task. Eyes – This is when you take your eyes off the road. It can be looking at a passenger, a navigation device, reading a text or looking for something inside the or outside of the vehicle. Your eyes are not focused on the road ahead and you are at risk of a crash. Looking away to read a text message or e mail is a high-risk behavior. Mind – you take your mind off driving to focus on another subject. Cognitive distractions can be your talking on your cell phone, processing the discussion at your last meeting, talking to your passengers, or daydreaming about your vacation. Your mind is not focused on safe driving. Texting involves all three types of distractions. You are manipulating the device, looking away to read and processing the message and your response. This is a crash waiting to happen. More states are making texting while driving a primary traffic violation. You do not have to violate any other traffic laws to be cited for texting while driving. Studies have shown that when you are distracted from driving with a complex phone call or discussion, your driving behaviors are similar to a drunk driver. Here is a short video you can share: https://www.youtube.com/watch?v=L6uepXw9gZA#action=share What you should do: Everyone can make the choice to use do not disturb feature on their phone. You can decide to adjust music and entertainment systems when stopped. Ask your passengers not include you in discussions or other exchanges that would take your mind or eyes off the road. Avoid eating and drinking while driving. You make the choice to focus on safe driving. Employers should have a company policy that cell phone use and texting during vehicle operation is not permitted. If you have drivers of commercial motor vehicles, these restrictions are part of the DOT regulations.

Key Steps for Ensuring Proper Maintenance of a Dry Pipe Sprinkler System In areas that are subject to temperatures below 40 deg F, you will find a dry pipe sprinklers system. This sprinkler system has a dry pipe valve that holds back water from the supply source. The valve is held in the closed position by air pressure in the system piping. When a sprinkler head opens, the air pressure drops, and the valve opens allowing water to fill the system and flow from the open sprinkler. This system requires maintenance to ensure reliable operation. Piping Since the piping is subject to freezing, it must be installed to allow complete draining of the system. This involves proper sloping of the pipe back to the riser and the use of remote auxiliary drains. The proper drainage of the system is a critical installation and maintenance consideration. Small areas with trapped water will freeze and cause the pipe to burst and cause water damage. Ice plugs that do not burst the pipe will prevent water from traveling through the system and impair protection. The inspection process should verify proper drainage and slope of the pipe to drain. Maintenance and verification of proper pipe draining is key to preventing water damage claims. Use of drum drip assemblies on drains requires routine inspection and maintenance during freezing weather. Failure to perform these maintenance tasks will result in a frozen system and water damage. Dry Pipe Valve The dry pipe valve holds back water until a sprinkler opens and lowers air pressure and allows the valve to open. This is a mechanical device that must be able to operate quickly and reliably. It needs routine testing to ensure the internal components operate promptly. Testing standards call for an annual trip test. Two years of these tests can be done with no full flow into the piping system. Every third year the piping system must be filled to allow the timing of water to the remote test point. The testing also allows internal maintenance of the valve seats that are at the air/ water control point. Routine cleaning of these valve seats will provide more reliable sealing of the valve and operation of the valve. Data gathered during the testing will include air pressure at start of test, air pressure at valve trip point, time to trip and time to discharge water at the test point. All of these are important test points and can be tracked over time to give an indication of interior pipe condition. If the time for water to travel is increasing, then the interior of the pipe is getting more corroded. This can lead to the need for a system flush to restore proper flow. Slow trip times for the valve may indicate valve maintenance is needed to assure proper operation. Dry Valve Enclosure The dry pipe valve must be kept at over 40 deg. F at all times. This requires an insulated and heated valve house. The maintenance should include inspection and maintenance of the heating system. A best practice is to have a low temperature alarm in the valve enclosure to alert you to heat loss. A frozen dry pipe valve will cause severe water damage. Air Supply The dry pipe system must have an adequate size air compressor or other supply of air to hold back the dry valve. The amount of air pressure is based on the valve specifications and normal supply pressure. Routine maintenance of the air supply involves verifying that the air pressures are proper. Mechanically the compressor must function and deliver the correct volume of air to allow reset of the valve. If there are automatic air supply systems, the electrical and sensors involved must be maintained and tested. Some systems use nitrogen as the system gas to prevent internal corrosion. If using air pressure, consider that the air entering the system will contain water vapor relative to humidity. A drier may be needed to prevent water from being added to the system via compressed air. Failure to properly maintain the drier can result in ice plugs in dry pipe systems that can impair protection. Obstruction Investigation As the internal pipe surfaces are alternately wet and dry from testing, there is inherent corrosion inside dry pipe sprinkler system. Pipe scale can accumulate and cause slower transit time for water or cause test outlets to plug. There is a requirement for five-year testing for obstructions. There are procedures to follow when systems show signs of obstructions. Dry Sprinklers While not part of a dry pipe system, these sprinklers are used to protect areas subject to freezing when the balance of the building is protected with a wet pipe sprinkler system. Since these sprinklers are subject to freezing at the operating end and building heat at the supply end, they can fail and cause water damage. These sprinklers are on an accelerated testing schedule needing to be tested or replaced every ten years after being in service for fifteen years. Why focus on dry pipe system maintenance? The dry pipe sprinkler system introduces a number of extra components to the sprinkler system. The dry valve has internal moving parts that can fail. The system itself can corrode and slow water travel and reduce flows needed for proper discharge. Piping systems that freeze can cause damage. Air supplies that are not maintained can allow systems to trip or high moisture in the air supply will cause excess corrosion and ice plugs. All of these conditions are unique to a dry pipe sprinkler system and need careful attention to assure reliable operation. Lack of maintenance and testing is a common source of risk control recommendations, removal of sprinkler credits and the source of water damage claims. If your inspection and maintenance providers cannot detail how they have looked at these items, question the thoroughness of their work. The Driehaus Difference We know how insurance companies approach maintenance of sprinkler systems and dry pipe systems specifically. We can offer you assistance in arranging proper testing and maintenance to provide the best of system reliability and property protection. Call us at 513-977-6860 or reach out to us using the contact tools on our website, www.driehausins.com. We want to be your insurance agent and welcome your questions and calls.

Why do you need builder’s risk insurance? When a building is under construction it does not qualify for traditional property insurance. Builder’s risk or course of construction insurance is designed to cover buildings under construction all the way through to the project’s completion. A builder’s risk policy may also be in place during renovation of a building. This policy may or may not extend coverage to the existing building. A standard property policy covers building materials used in a renovation but excludes coverage for materials that are owned by subcontractors or have not yet been installed. A standard property policy may extend coverage for the actual value of materials owned by the building owner but would not cover the labor and overhead associated with that installation. This is a significant coverage gap that could derail your renovation project. Builder’s risk policies are intended to accommodate the increase in values during construction. The values will start small and increase through the course of the project. The pricing methodology for a builder’s risk policy reflects this ramping up of values. A traditional property policy would charge for the full value from the start of the project. In many cases multiple subcontractors are providing the materials and labor. As such, you are depending on the insurance program for each entity to respond at the time of loss. This creates a cumbersome claim scenario where several insurers are arguing over who is responsible for paying the claim. Who should carry the policy? We recommend that the project owner be the holder of the builders’ risk insurance. This addresses several concerns. The first is that the owner knows the in-force status, policy limits, and provisions of coverage. The owner is not relying on a third party to select coverage and pay premiums. The second reason for the owner to hold the policy is to have control over any potential claims. The owner can be sure to have their interests front and center during the claim settlement negotiations. If you are not the policyholder, you are along for the ride as someone else is in control. What is covered in a builder’s risk policy? Many insurers will offer several policy forms that vary based on what property is covered. The most basic forms will cover buildings in the course of construction or newly constructed buildings. These forms do not provide coverage for a standing or existing building. Renovation based forms will cover renovations or rehab projects and also extend coverage to the existing building. This is a critical coverage term that must be considered to ensure coverage is extended to the existing portions of a building. There are forms that add additional insurance coverage that provide broader coverage for other exposures. These exceed the scope of this article. Policy Variations Most policies are consistent and include the major exclusions around civil authority, earth movement, flood, fungus and mold, sewer back up, ordinance and law and war and military action. The variation comes into play with the next tier of exclusions. The forms may be different around exclusions related to freezing, materials and workmanship, losses from rain, snow, ice, or sleet and settling cracking or bulging. The forms that have more restrictive language are slightly less expensive. The next level of variation between policies is the number of coverage extensions and supplemental coverages that are included. Typical coverage extensions are debris removal, emergency removal, fraud and deceit, waterborne property, and a nominal fungus sublimit. The second area is supplemental coverage that can include ordinance and law, expediting expenses, fire department service charges, limited pollutant cleanup, sewer back up, property in transit or in temporary storage. The forms may add or subtract this supplemental coverage and change the limits. What the policy will pay Every builder’s risk policy is based on replacement cost. This is the cost to repair, replace or rebuild the property with materials of like kind and quality. The policy may have a coinsurance clause. If your limits are found to be inadequate, your loss recovery will be reduced by the ratio of insufficiency. We have an article on coinsurance that expands this discussion. Coinsurance article - click here When coverage may end Coverage ends when the policy expires, you fail to pay the premium or the project is completed. Your builders’ risk policy may no longer provide protection if the building is partially or fully occupied for its intended purpose without the permission of the insurer. For phased construction projects or projects where some units may be completed and occupied earlier than others, you must manage this notification process. The loss exposures in an occupied structure are different from a construction site and the carrier may or may not want to assume those exposures. The Driehaus Difference Insurance for a construction project is not something to leave to the lowest bidder. Different policy forms, different coverage needs and knowing which insurance company has the appetite for your project are where we bring our expertise to focus on your needs. Call us at 513-977-6860 or contact us via our website at www.driehausins.com  We want to be your insurance provider.