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Owning a second home and renting it out is a common situation. This can be a vacation home or a piece of investment property. As a landlord for one of two properties, you may not have considered the risk management issues that you need to consider. As your real estate portfolio grows, these risks will be more significant to you. Proper Insurance Coverage It may be easy to tell your agent to add another address to your homeowner’s policy. Carefully review the language in the homeowner’s policy to see if a residence that is not being occupied by the policyholder is covered by the policy. You may need a specific landlord’s policy or a commercial insurance policy to cover a home that you own but do not occupy. This concern would not apply to a single building with up to 4 units, one of which is occupied by the policyholder. Property Insurance Considerations The most critical issue for property insurance is setting the correct limit for the building. We have discussed proper valuation in previous articles. See What is My Property Worth? Beyond the basic value of the structure, consider the income loss that would occur with a loss. Also consider any furnishings and supplies that you provide at the rental property. If you plan to rebuild, consider if there are any code upgrades that would be needed. Upgraded roof requirements, seismic requirements and other building code changes since the building was built should factor into this decision. If like kind and quality will not meet code, you need to have the additional coverage to protect you. Liability Insurance Whether you use a landlord’s policy of a commercial general liability product you need to review the program to consider what are the limits of coverage you need? The minimum limits offered by some programs may be inadequate to protect your interests. Low primary limits may also make acquiring excess liability more expensive. Knowing your limits will help design the most economical program. What level of medical payment coverage do you want to provide? Med pay is a no-fault coverage to pay for small claims. The intent is to limit litigation. Depending on your tenant profile, this can create a small loss frequency that will affect your pricing. Lease Agreements Written lease agreements are absolutely needed. Do not rely on handshake agreements. Many liability insurance policies will not stand behind unwritten agreements. Make the tenant responsible for obtaining and maintaining renters’ insurance for the duration of their occupancy. Ask for a certificate of insurance or a copy of the current policy year declarations page to see coverage terms. We strongly suggest you use your attorney to develop your lease. This will make sure the terms reflect your intentions and needs. Online or preprinted leases can be too generic to protect your interests. Life Safety As a landlord you are responsible for providing a safe living environment. Make sure you have installed and maintained smoke detectors and carbon monoxide detectors in your rental property. Specify who is responsible for ongoing maintenance in your lease. Be sure to have these devices tested EVERY time you access the property. Portable fire extinguishers should be provided. Scald controls As a landlord you must provide adequate hot water. If the tenants can access the hot water heating equipment, they may raise the temperature in an attempt to get more hot water. This does not create more water volume but raises the potential for scalds. This is another inspection point that should be documented. Most tub and shower valves are now pressured balanced to prevent scalds. If yours are not this type, consider upgrading. Contracts for service You may have contracts for cleaning, yard care, snow removal and other services. Have written agreements with requirements the provider carry limits of insurance equal to your own and ask that you be named as an additional insured on the provider’s liability insurance. The long-term cost of a lawsuit makes using uninsured contractors a losing proposition. Entertainment Equipment If your rental includes any entertainment equipment, pool, hot tub, spa, sauna, trampolines, or fire pits make sure they have all the required safety equipment. This includes fences, gates, proper electrical installations, water chemistry and clearance to combustibles needed for the equipment. Security Key control is critical to the safety of your tenants and your interests. Consider using locksets that can either be immediately reprogrammed for lock changes. If you use a key lock, use a lock brand that has restricted key duplication. Track who has keys and change locks when tenants change, or a key is missing. Premises inspections You should have documented inspection records for your property. This includes whenever tenants change and whenever you have access to the property for planned maintenance. Being able to document that appliances, utilities and protective devices were present and accounted for is crucial to your defending a claim. Short term rentals If your property is listed on short term rental web sites, VRBO or Airbnb, you may have less insurance company options. Since short-term tenants have very little long term interest in your property, they have a history of being less careful with their actions within your property.  Increased property damage potential and increased liability issues have made some carriers move away from this exposure. The short-term rental sites offer the renter access to physical damage insurance in lieu of putting down a damage deposit. Consider if you want to make this insurance a requirement for your property. That eliminates credit risk for damage or repairs and lets your insurance company deal with their insurance company for a claim. The Driehaus Difference Our staff know the details of risk management for property owners. We know which companies can offer the most effective insurance programs given your properties. We take time to ask the next level questions that tailor an insurance program to fit you. This is not available in online environments and where you “only pay for what you need.” You have worked hard to own property and you need an agent to work hard to help you protect your interests. Call us at 513-977-6860 or use any of the contact tools on our website www.driehausins.com. We welcome the opportunity to be your insurance agent.

Employment practices are an area that every business with employees must consider as a loss exposure. As long as employees are present, the exposure is there regardless of the number of employees, size of the business or type of structure. You should know that almost all employment-related liabilities are excluded under your standard business liability coverage. You need to have the proper risk management programs in place to protect your interests. Discrimination Exposures Being able to clearly document your employment decisions and show that you are basing your decisions on facts and performance is the key. Having clearly defined hiring standards, job descriptions and performance review processes are keys to controlling this exposure. Wrongful termination The controls for discrimination aid in controlling wrongful termination exposures. Clearly written job descriptions are a foundation. Defining what the expected behaviors and results from the position set the framework for the next control element – effective performance reviews. Having established clear and objective performance expectations via the job description, having a clear and objective review process reinforces the message that job performance is managed. When performance falls short of the set standards having a clear and documented performance management process protects you from claims of wrongful termination. Having a documented performance improvement process and reviews during this process to measure performance allows you to reach a separation decision with adequate warning and clear communication. Sexual Harassment — goes beyond a quid pro quo offer of sexual favors for employment or promotion. Sexual harassment can arise from workplace environmental issues such as sexually suggestive posters, email messages, text messages or other forms of communication that may expose an employee to content that is objectionable. Recognizing that content that is NSFW (Not Safe for Work) is not funny but creates a real exposure to loss is the key element to prevent this loss. Having a clear process to receive and investigate employee reports or concerns also demonstrates your commitment to harassment prevention. Retaliation for reporting harassment or raising a claim of discrimination can make an unpleasant situation worse. In addition to liability problems there are legal issues related to retaliation for reporting workplace safety issues that OSHA can bring forward. There are claims that can be brought under civil rights laws and investor protection laws that have serious penalties. Having a documented reporting and investigation policy for employee concerns is the best defense. Confidentiality of investigations also aids in retaliation prevention. Inappropriate Employment Conduct — or tolerating inappropriate behavior on the job can give rise to a claim for employment-related liability. Having documented workplace rules and documented progressive discipline procedures to enforce those rules is key to preventing liability. Your being able to show that your workplace rules are reasonable and that you have an impartial enforcement process demonstrates your even-handed approach to managing your workforce. The Driehaus Difference We see EPLI as an area of exposure for any company with employees. We have markets for EPLI for employers in all sizes and in all industry types. We want you to consider carrying ELPI coverage because the benefit of having this insurance in place is access to the resources of the insurance carriers to help develop the controls we endorse. From sample programs, video training and hotlines for assistance and advice, there is a network of supporting services to help you manage this exposure. We welcome the opportunity to be your insurance provider. Let us be your guide to accessing these tools via placement of your EPLI coverage. Contact us by phone at 513-977-6860 or use our contact tool on our website, www.driehausins.com to get in touch.

Rear end collisions are one of the more common types of auto losses. They account for 1/3 of all reported traffic accidents   If you strike another vehicle from behind you are assumed to be at fault for the accident. That makes rear end collisions an attractive target for claims being filed against the at fault driver. You can avoid being placed in this difficult position by practicing a few simple defensive driving behaviors. Do not drive distracted – If you are not concentrating on safe vehicle operation you can easily find yourself in trouble. Studies have shown that distracted driving reaction times are similar to drunk driving reaction times. If the phone call, text of other activity requires your attention, you need to do this when stopped. Distraction leads to longer reaction times that increase your chance for a rear end collision. Speed Control – Some collisions are the result of your not being able to stop in time at a signal, intersection or for stopped traffic. Excess speed is often the root cause of this event. Excess speed will aggravate your liability for the rear end collision if you are at fault. Excess speed will aggravate property damage and personal injuries from the collision. If your speed is judged to be excessive, your potential liability is increased. Data recorders in vehicles and telematics programs can capture your speeds and this information can either help or hurt your case. You can count on it being requested during the investigation. Following distance – Following distance is a primary way to protect you. Following distance provides you with time to react to changing conditions and enough space to change lanes or stop. The best following distance is a minimum of three (3)) seconds between you and the vehicles in front of you. This is a distance that must be actively managed. Many time others will merge into your space cushion, so you will need to adjust the distance to regain the needed separation. As road conditions become wet or slippery, expand this cushion to six (6) seconds. This compensates for increased braking distances and the additional hazards of poor road conditions. Use this greater distance for highway speed driving to allow adequate reaction time to traffic changes ahead of you. To judge following distance, let the vehicle ahead of you pass a fixed object and you then count to see how many seconds behind you are. With time and experience you will be able to judge an adequate cushion of space without taking measurements. Stopping short in traffic - When you stop behind another vehicle in traffic, leave enough space to see the rear tires of the vehicle ahead of you. This space allows you to move around a stalled vehicle or to see an impending rear end collision in your rear-view mirror and move up to avoid the impact. The extra space gives you options to use when needed. Use care when merging – Entering traffic from being parked, merging onto a highway, or changing lanes can put you in the position of being struck from behind. In many cases you do not see the oncoming vehicle that was in your blind spot. Always double check your blind spots when merging can prevent you from being struck by another vehicle. Do not rely solely on your mirrors, turn your head and look for yourself. Avoid drowsy driving – If you are tired or drowsy your reaction time will increase. Your powers of observation will be reduced, and you may not notice a hazard ahead. Get off the road and fresh yourself. Use Technology – Newer vehicles have collision avoidance features that alert you to a hazard and can apply the brakes for you. Technology can also alert you to cross-traffic hazards. Some driver behavior measurements available in telematics applications can be helpful. Repeated instances of strong brake application can be an indicator that proper following distance is not being maintained.  Telematics can also measure excessive speed behaviors. This data can be used for driver behavior improvement and some insurance companies will provide or subsidize this type of technology. Maintain your vehicle - Lack of brake lights raises the chance of your being involved in an accident. Proper maintenance of the brake system is also needed to provide safe driving conditions for your vehicle. A poorly maintained vehicle is a hazard unto itself. The Driehaus Difference We can help you identify programs and services from your insurance company to help with driver monitoring or safe driving support. Some insurance companies offer driver monitoring as part of their rating process. We can help you navigate these resources for the best program for your needs. Call us at 513-977-6860 or reach out using our website, www.driehausins.com

The insurance industry has a long history of being reluctant to pay for claims related to water damage. Claims of water damage can be traced to a number of causes. We will address the causes and the typical insurance response to these events. We will address risk management for water damage exposures. Flood Flood, surface water, waves, tidal water, or the overflow of a body of water, all whether driven by wind or not, this includes spray that results from these whether driven by wind or not. This is the exclusion language that would exclude coverage for surface water flooding, wind driven rain, and storm surge related to a hurricane. Your standard insurance policy excludes these events. You need to have a flood insurance policy to cover these events. We have previously published a number of articles on flood insurance and the data behind this hazard. Check these links out. Flood Insurance Information You Need to know Flood Insurance What do I-Need Sewer Backup Water or waterborne material that backs up through or overflows or is discharged from a sewer, drain, septic system, sump pump or related equipment is excluded from property coverage. Your insurer may offer a sublimit for back up of sewer and drains and you need to evaluate your exposure to loss from this type of event to set an appropriate limit. Many policies offer a small, $25,000, limit that is quickly exhausted by a minor event. Evaluate your interior finishes and set a limit that can cover your expected loss. Water below the surface of the ground This includes water that exerts pressure on or flows, seeps, or leaks through or into a building, structure, sidewalk, driveway, foundation, swimming pool or other structure. This is another type of water damage that is commonly excluded by a standard property policy. You may be able to obtain a limited water damage endorsement to cover this exposure. Just as the sewer back up endorsement has a sublimit, this endorsement will also offer a sublimit. Select the amount of coverage based on the exposed values. Fungi, Wet Rot, Dry Rot and Bacteria Small leaks that persist over time can be caused by improper construction, deteriorated caulking and sealing can cause water damage. This type of water damage can cause structural damage via wet and dry rot and expose you to health hazards from mold and fungi. Insurance policies have excluded coverage for this type of damage. Most policies will offer a small sublimit for this type of damage. It is often more economical to offer a small sublimit than to exclude the peril. The sublimit reduces the exposure to litigation for the insurance company. Leaking Pipes If coverage for this type of event is included in your policy, the insurance company will pay for the resulting damage from the leak but will not repair the pipe or system that was leaking. The leaking pipe must be a sudden and accidental event that was immediately noticed. Damage from leaks that persist for more than 14 days are excluded from property coverage. Water Damage Risk Management Detection systems Puck style detectors are placed near suspected leak sources and report when they detect water. Other technology of cable systems that can be placed in or around equipment and provide detection along the linear length of the cable. These systems generate an alarm signal that can be a locally supervised or if connected to the internet provide a text message or other off premises notice. Some systems can close a valve on the system or specific appliance to shut off water. A second technology is a water monitoring system that learns what are typical water flows for your property and alerts you when an abnormal flow is detected. These systems are routinely configured to shut off the water valve to prevent further damage. Planned Response Having the right tools and equipment to respond to a water damage event can significantly reduce the amount of damage. Water extraction equipment, mops, squeegees and other clean up equipment can be staged and ready to use. Valve Management Shutting off water immediately upon discovery of a leak is an immediate loss reduction step. Knowing the location of each shut off valve and exercising those valves to be sure they can be operated is a low to no cost risk reduction process. The Driehaus Difference We understand the reluctance of insurance companies to absorb water damage claims and expenses. We also understand that you need protection from the economic catastrophe that these events cause. We know the various company forms and available products to address this exposure. We can also help with identifying carriers who offer discounts or cost sharing for water detection system. This is part of your insurance program that is not easily arranged in an online environment or when you only way for what you need. Most buyers do not understand the specific language of insurance and miss getting the right coverage. Call us at 513-977-6860 or contact us via our website driehausins.com so we can be your insurance advocate.

Winter can be a tough season on your home or business. Some preparation can make your season warmer and without the frozen pipes, ice dams and system damage. Check that smoke alarms and carbon monoxide detectors are working properly. Winter is heating season and any fuel fired appliances are carbon monoxide generator. Take a moment to check your smoke alarms and your escape plan. Do you have a meeting place selected? Obtain your winter snow removal supplies such as ice melt before the first snow. Given the supply chain issues this year do not get caught waiting and needing supplies. Verify snow removal agreements are up to date and risk transfer is in place. Leaves should be removed from gutters and downspouts cleaned and water directed away from your foundation. Clogged gutters can cause an ice dam that will cause roof and interior damage Drain outside faucets and disconnect hoses. A freeze may cause the water trapped at the hose connection to damage the faucet. If the faucet is not frost proof, turn off the water and drain the faucet line. Service your heating system now before it must perform at peak load. Check and replace filters in your furnace. Many service companies have warranties that last the season if you have a service and inspection. Now is the time to insulate any vulnerable water lines in crawl spaces or along exterior walls. Insulation will save you energy costs as well as reducing the freeze potential. Leaving a faucet drip when a freeze is expected can prevent pipe failure. Assess the condition of weather-stripping on doors and windows. While the weather is till nice, make repairs and replacements. Prepare your outdoor systems such as irrigation, pool, or spa systems for winter. Drain and winterize these systems to prevent system damage. The Driehaus Difference We understand that any property loss creates more than just an insurance claim. We want you to be able to prevent a loss and to enjoy the life you have built. We can help protect that life and what is important to you. Call us at 513-977-6860 or visit our website at www.driehausins.com to connect with us.

Chimneys and vent pipes are an important part of the safety system for your home or business. These devices remove the products of combustion from solid fuel or fossil fuel appliances and devices in use. Improper maintenance can lead to accumulation of deposits that can be highly combustible and reduce the efficiency of the ventilation allowing introduction of flue gases, including carbon monoxide into the structure. You should inspect your chimney and vent pipes as part of normal preventative building maintenance. When to inspect? NFPA 221 The Standard for Chimney, Fireplaces, Vents and Solid Fuel Burning Appliances recommends an annual inspection. There are three levels of inspection activity that can be done. Inspection Levels Level 1 – Inspect the readily accessible areas of the chimney. Look for evidence of obstructions or combustible deposits in the flue. Check that appliances connected are properly installed and connected to the vent.  If you burn sold fuel equipment, the Level 1 inspection may reveal the need for cleaning. Level 2 – All of the above and add evaluation of proper construction and condition of accessible areas of the flue. Check for proper clearance to combustibles for accessible areas and verify proper sizing of the flue for connected appliances. Level 3 – Inspect all of the above and include concealed spaces for inspection. Degree of access required Level 1 - requires visual inspection of immediately accessible areas. Level 2 - may require video scanning of the flu and connections to verify condition. Level 3 - may require opening the structure to gain access to the chimney and to verify proper clearance. How to choose the appropriate level? Level 1 - is appropriate to verify suitability of the chimney for continued service with the same connected appliances and devices. There have been no changes in the equipment or venting system. Routine cleaning can be part of the Level 1 inspection. Level 2 - is indicated if you have changed appliance or devices that would require additional venting capacity. This is also needed when any damage has been reported, or if you are a new owner of an existing property. Level 3 - is indicated if the chimney is in need or repairs or must be renewed to make operations safe. Who can do this inspection? The inspector should be “qualified” to do this work. This means training and experience in the type of chimney or flue involved. Professional chimney sweeps are available for cleaning and inspection work. For vents for non-solid fuel burning equipment, your HVAC contractor may be able to do the needed inspections as part of their routine preventative maintenance work. Carbon Monoxide Detection - Part of your Safety System In any building that uses fossil fuels or solid fuels there is a need for carbon monoxide detection. Carbon monoxide is a by product of combustion. It is odorless, colorless, and tasteless. It bonds to the oxygen in your system, preventing that oxygen from being used by your body. Low level exposure symptoms can mimic a cold or allergies. Headaches, coughing and a general feeling of illness are common. You should have a UL listed carbon monoxide detector near any fuel burning device. Consider adding additional carbon monoxide detectors to your sleeping areas. UL Listed devices are designed to alert to higher concentrations of carbon monoxide that persist over a period of time that could cause illness. There are other detectors that can alert you to lower levels of carbon monoxide. These can be beneficial if anyone in the household has underlying medical conditions that would be aggravated by carbon monoxide exposure. Emergency Plan for Carbon Monoxide If the detectors activate, have a plan. The plan should provide for an immediate evacuation, a head count to verify all are accounted for and call 911 for the emergency services to investigate. Since carbon monoxide gas is odorless, colorless, and tasteless, there is no substitute for a thorough investigation using carbon monoxide specific test equipment. The emergency services may also request the utility company that provides gas service to respond to the investigation. The Driehaus Difference No insurance product can replace the need for safety related inspections, maintenance, and planning. We encourage our clients to recognize hazards and take appropriate actions to protect themselves. Our series of Insight articles have covered a range of hazards and their potential controls. We offer this advice to help you avoid the need to consider if there is applicable insurance.  If you have questions or need insurance or risk management advice, call us at 513-977-6860 or contact us via our website at www.driehausins.com

Fire sprinkler systems need your attention to prevent a freeze event that can either impair protection or cause water damage. As winter sets in here are the things you should evaluate. Building Temperature for wet pipe systems Wet pipe sprinkler systems are filled with water and must be kept above 40 degrees F to prevent damage. If you have any areas of your building where the temperature may drop, consider improving heating, insulation or adding a low building temperature sensor to that area. Do not shut off or isolate sprinkler lines dues to cold weather. The system design depends on complete protection and a large fire in a non sprinklered area could overwhelm your system. Many insurance policies contain a protective safeguards endorsement that requires you maintain the sprinkler system. If your policy has this provision, be sure to review the conditions related to impairing any protection. Building Temperature for Dry Pipe Valve Enclosures The dry pipe valve has water on one side of the valve body and this valve enclosure must be maintained at 40 degrees F to protect the valve. Check the heating systems for the dry pipe valve enclosure for proper operation and perform any needed maintenance or repair. Add a low building temperature sensor to the valve enclosure. It is an economical way to avoid a significant freeze damage event. If the enclosure is alarmed, it can be inspected weekly. If no low temperature alarms are present, a daily inspection is needed. The use of heat tracing on sprinkler systems is limited to systems that are specifically UL listed for use on fire sprinkler systems and that can be supervised to confirm the system is energized. Auxiliary Drains on Dry Pipe Sprinkler Systems Any area of the dry sprinkler system that does not drain back to the riser may trap water and be subject to freezing. There are auxiliary drains for these areas and the drains on a dry pipe system are equipped with a drum drip. This piping should be drained after any system test or activation and when cold weather is imminent. Part of the annual inspection should be identifying any areas that may trap water. Failure to do so can result in forzen pipes and water damage. When a drum drip is in “normal” position, the top 1” valve (A) is open, allowing moisture to enter the condensate nipple, while the bottom 1” valve (C) is closed. To drain the condensate nipple (B), the top valve is closed then the bottom valve is opened to remove accumulated moisture. When preparing for freezing temperatures, the auxiliary drains should be operated daily with the frequency of operation decreasing, depending on the discharge of accumulated water. Quick opening devices where present, should be temporarily removed from service prior to draining the system Low Points. If you are not comfortable with this process, schedule your sprinkler contractor for an inspection and ask for training on this routine system maintenance process. The Driehaus Difference Fire sprinkler systems provide the best protection for property and life safety. To be effective the systems must be properly maintained. Part of that maintenance is preparing the systems for winter weather. We can help you identify potential protection issues and work with you and your insurer to get the best protection and insurance rates for your property. Call us at 513-977-6860 or reach out to us on the internet at www.driehausins.com

Sprinkler systems and standpipe systems often have a fire pump as part of the water supply for the systems. If you have a fire pump as part of your fire protection system, you should know some basic facts to help you manage this important equipment. Fire pump or booster pump? A fire pump takes its water supply from a non-public source. This can be a river, pond, water storage tank or wellfield. The water supply must be able to support the fire pumps rated flow capacity. The supply must have an adequate volume of water to last for the duration of time in the fire protection system design. The duration can be between 30 minutes and 120 minutes. A fire pump is the sole source of water for the fire protection system. If your fire pump fails, you have no water supply for fire protection. A booster pump is a more common arrangement where the pump takes its water supply from the city water system. Duration is generally not an issue as the city supply is generally adequate for the volume of water required. The pump is used to boost the pressure from the water supply system. If the booster pump fails, you will still have city water pressure in the system. Your system will be deficient in water delivery, but some water may be delivered. Pump Ratings A pump for fire protection is rated for a specific flow rate in GPM at a particular pressure measured in PSI. A 1000 @ 60 pump will deliver 1,000 gallons per minute (GPM) at 60 pounds per square inch (PSI) of water pressure. The rating is a design element of the fire protection system and was selected at the time of the system’s installation. Pumps are also rated for the speed at which the pump operates in revolutions per minute (RPM). These three rating points are fixed, and the pump is tested to see that it matches the flow and pressure when operating at the design speed. Power Supply Fire protection pumps are generally powered by a diesel engine or an electric motor. In either case a controller is used to automatically start the pump when needed. The controller also has the ability to manually start the pump. Controllers have stop switches and disconnects to shut off the pump. The controllers and drivers of the fire pump must be listed for fire protection service. Diesel engines require a fuel supply that is adequate for the duration of the fire protection system water supply design. Since diesel pumps are routinely started and run for tests, the fuel supply must also be adequate to perform these tests. Fuel quality is important, and the fuel tank must be leak tight and have a level indicator to monitor fuel availability. Electric pumps have a controller that has start, stop, and test provisions. The electrical supply is designed to be resistant to fire damage and mechanical damage. If the power supply for the property is not considered reliable, a generator will be needed to support the fire pump. Some insurance rating tools penalize buildings that rely on an electric pump and that lack an emergency generator. Testing Fire pumps require routine testing to assure proper performance. NFPA 25, The Standard for Inspection, Testing and Maintenance of Water Based Fire Protection Systems, details the required testing. This document will highlight the weekly, monthly, and annual tests. Regardless of power supply an initial acceptance test is required to duplicate the fire pumps performance ratings and to run the pump under load for a period of time to allow evaluation of the mechanical conditions. Electric pumps must be tested monthly and operated for no less than 10 minutes. The pump must be started automatically. This can be done with no flow conditions A diesel pump should be operated weekly for no less than 30 minutes. This can be done with no flow condition. The pump must be started automatically. For both types of pumps an annual full flow pump test to verify operations and ratings of the pump. Accurate pump testing procedures are critical to monitoring the condition of a fire protection pump. Data should be recorded during these tests that include suction and discharge pressures observed. Some controllers have automatic testing and data recording features to automate this process. Annual flow tests should be compared to prior tests to verify pump performance has not degraded. What can affect a pump’s performance? Fire protection pumps are generally very reliable. There are some conditions that can adversely affect a pump’s performance. This list is only those conditions that are most common. NFPA 25 has an appendix dedicated to pump troubleshooting. For diesel pumps these commonly include: Poor battery maintenance that affects starting Poor fuel quality or quantity Lack of routine maintenance on the diesel engine itself, oil changes, cooling system and other mechanical parts For electric pumps the common issues include: Degraded or damaged electrical supply Loose or corroded electrical connections For either system there are common problem areas Controller maintenance and component failure in the controller that prevents automatic starts Mechanical failure of pump to driver connection due to lack of lubrication of misalignment. Degraded water supply that prevents pump from meeting rated flows Damage to or an obstruction in the pump itself The Driehaus Difference We want our clients to understand the basics of fire protection pumps and the required testing and maintenance that is required. This is a common source of recommendations from insurance carriers and deficiencies can adversely affect your fire insurance premiums. Call us at 513-977-6860 or contact us via our website at www.driehausins.com

Lithium-ion batteries have become the standard power source for most portable devices. The technology allows for a powerful power source in a smaller package. The batteries do not have the memory effect that prior rechargeable batteries had that diminished their lifespan. Lighter wight and greater power have made lithium ion the battery of choice. As no good deed goes unpunished, there is a downside to these batteries. They can present a very unique fire hazard that is hard to manage and produce a fire that is difficult to control. Battery Chemistry and Hazard A lithium-ion battery structure has an anode, and a cathode as does any battery. The passage of the lithium-ions between these two materials generates an electrical charge. The properties of lithium ion batteries allows superior power versus prior battery types. The flow of ions is in one direction when discharging and powering a device and the opposite direction when the battery is charging. The passage of these ions is done in an electrolyte solution that is commonly an organic solvent. The basic chemistry of the materials provides carbon, a fuel, oxygen contained in the anode and cathode materials and the electrolyte may be a flammable or combustible liquid. All of the ingredients for a sustained fire are present. When there is damage to the cell or the onboard electronics that manage the charging and discharging fail, the battery can enter a runaway chemical reaction that leads to an explosion or fire. Since all of the materials needed for combustion are present, the reaction is self-sustaining. The fire can be difficult to extinguish and may reignite easily after it appears to be extinguished. Fire protection methods for this hazard are still being developed. Lithium-Ion batteries are probably in your pocket (smartphone), on your desk (laptop), in your car (EV), in the mail (musical greeting cards) and possibly in your home or office building as an energy storage system for wind or solar power or an uninterruptible power supply for critical equipment. You cannot ignore this hazard. What to Do about this hazard The batteries become hazardous when they are physically damaged. Original testing by UL was “blunt nail test” to see if the cell was strong enough to resist physical damage. The second scenario is when the onboard circuitry that manages charging and discharging fails. Both of these hazards are manageable. UL testing and listing addresses both of these issues in manufacturing of the battery. Purchasing controls Buy devices and batteries that are UL Listed and from a reputable source. The market is full of unlisted cells that are cheap and therefore popular. You get what you pay for, so be a wise shopper when introducing this hazard into your life or home. Charging and Discharging Use the charger and cable that comes with your device. It is rated at the correct voltage and power output for the battery pack. If you are using other cables and charging devices make sure those devices and cables are UL listed. With the proliferation of USB charging systems, the quality of the cable becomes a paramount concern. Check the USB charger for a UL listing mark. Do not alter the cell arrangement to increase power output. Connecting cells in series to increase voltage or capacity is outside the original design of the battery and may cause a failure. Storage Since lithium-ion batteries can retain a charge for a long period, treat any battery as a charged battery. Do not allow battery terminals to contact one another or a grounded surface. Lithium-ion batteries are shipped in protective sleeves or packages to keep the terminals from contacting each other. Use this same method to store batteries. For devices with large batteries such as electric bikes and scooters, consider storing them in an area that is cut off from the balance of your facility with fire resistant construction and have fire detection equipment in this area. Prompt notification of a fire and the time purchased with fire resistant construction can make a difference in a fire event. Disposal Do not assume that the lithium-ion battery is dead. It can still retain energy and disposing of this type of battery where it could contact another battery or grounded surface can create a fire. Before depositing the batteries in a recycle bin, apply tape over the terminals to prevent contact. There are disposal points that accept lithium batteries. Check https://www.call2recycle.org/ for a local disposal site. Many Home Depot, Lowes and Staples stores participate in this program. Do not throw lithium-ion batteries into the trash. When the trash is compacted or processed the cells can be damaged and start a fire. This is becoming more frequent in landfills and recycling centers. The Driehaus Difference As fire experience data with these batteries and their devices continues to accumulate, there may be changes in building and safety codes to regulate this hazard. We also expect to see property insurers take notice of this new hazard. We follow these emerging trends so we can offer our clients sound risk management advice. Reach out to us for assistance and advice on your insurance and risk management programs. You can call us at 513-977-6860 or contact us via our website at www.driehauins.com We look forward to helping you with your insurance needs.

Every business is subjected to a barrage of cyber attacks every day. Regardless of your business size, your email, web site and network are being probed and tested for vulnerabilities. Small business owners often say they don’t have the time or resources to address these issues. Unfortunately, you do not have the choice, you can protect yourself or be a victim. Why would a bad actor target you? Here are some of the ways to become an attractive target. Email Scams Cyber attackers generate emails that ask for personal information, credit data, bank account information and passwords. These are called “Phishing” attacks and they are the most common type of cyber threat. You can attract these threats by not having an effective email screening and blocking process. The cybercriminal uses the same type of email software to send their phishing campaigns as a legitimate firm may use for customer solicitations or fundraising for a non-profit. The software can track how many emails are opened, forwarded, and how many links within the emails are clicked. This is a tool to measure the effectiveness of the campaign. If you have a small number of email addresses associated with your domain name, it is easy for your domain to have a high percentage of opens, forwards, and clicks. In a ten-person organization, if 3 people open or forward a message and 1 person clicks a link you have a 30% open rate and a 10% click rate. This is a major success for the cybercriminal. Your email addresses and domain are now identified as vulnerable and would be a more valuable target in the future. Since many of the phishing emails appear to come from the CEO or owner of the firm, getting a high open rate or click rate is not uncommon. Having good email screening discipline is critical and low to no cost as a safeguard. Teach your staff to mouse over the sender’s name to see their email address. If the email address is not what you expect to see, immediately block that sender. Do not forward the email to everyone and tell them it was a scam. You increase the open rate and forward rate for this attempt. If your internet service provider (ISP) has a security feature to report suspicious emails, use it. If the phony email was supposed to be from one of your vendors, alert them to the event. Ransomware Ransomware is the introduction of software in your network that encrypts the data and makes it unusable. The cybercriminal then offers to reverse the process for a payment. The bad actor may also threaten to release your data, including confidential and personal information if you do not pay. The keys to preventing a ransomware attack fall into low-cost efforts that should be part of your normal operations. Update your software. Operating systems have automatic functions to allow updates to be loaded automatically. Unless you have a dedicated IT department, use the automatic update features to keep your systems in the best protection status. If you have on-premises servers for files and email service, be sure you have the proper updates and security processes in place. Many small firms lack the IT expertise to manage these systems. Know your limitations and respect those exposures. Have an antivirus and anti-malware program in place. Use the automatic updates for this service to keep it current. Many of these products include automatic update screeners for your other software to keep it updated. If you have off-premises access to your data, use Multi Factor Authorization (MFA) to have a second layer of access control. MFA is becoming a mandatory feature for some cyber liability insurance providers. No MFA, no coverage. Resources If you have a cyber liability policy, the carrier may have resources for your use to help you protect yourself. Most cyber policies have information attached to the policy about support services available. A very comprehensive resource is provided by the US Government. The Cybersecurity & Infrastructure Security Agency (CISA) has screening tools, sample policies and screening tools that can be used. Visit www.cisa.gov for access to this information. The Driehaus Difference We want you to be successful and in reality, the amount of coverage available for cyber liability losses is not sufficient to cover all of the expenses of the event. We want our clients to make informed decisions about managing their exposures and implementing controls that are sustainable and affordable. Call us at 513-977-6860 to reach one of our staff members or contact us via our website www.driehausins.com to get in contact with us.

Your business may have responsibilities for complying with Commercial Motor Vehicle (CMV) regulations. The need for this is based on vehicle use, size and it can vary by state. This is a general look at United States Department of Transportation (USDOT) regulations. What is a CMV? The general requirements for motor carriers are found in Part 390 of the DOT regulation. In this section a CMV is defined as a vehicle having: A gross vehicle weight rating (GVWR) as a single unit or a combination unit or 10,001 pounds or more – or - Is used to transport more than 8 passengers, including the driver, for compensation – or - Is used to transport more than 16 people including the driver and is not used for compensated transport – or - Is used to transport any hazardous material that requires placarding Definition 1 can be a tripping point for vehicle owners that tow trailers behind pick-up trucks or other light trucks. The combined weight of the main vehicle and the weight of the trailer and load must be under 10,001 pounds or the vehicle is a commercial motor vehicle. Do not rely on the GVWR shown on the main vehicle data plate. Definitions 2 and 3 around transporting passengers makes the distinction between for hire transportation and transportation not for hire. Any for hire transportation has a much lower passenger count. The higher passenger count for non-commercial passenger transit would apply to any business or group using buses for their transportation. This can include schools, churches, clubs, and sports teams. The hazardous materials regulations specify what products are regulated and the quantities that trigger placarding. If you are transporting chemicals, you should review these regulations carefully. What does a CMV Require? Ownership or operation of a CMV will trigger certain obligations. The short list of these are as follows: You will need to file an MCS -150 form with information about your business and fleet with the DOT. This requires you to obtain a US DOT number. MCS-150 filing is required every two years. Your drivers will need to follow any regulations related to commercial drivers. This includes rules regarding use of cell phones and texting while driving. Pre-trip inspection rules also apply. Maintenance of an accident register for any vehicle accidents involving a fatality, bodily injury, disablement or requiring a tow-away. Vehicles must be properly marked with the legal name or trade name of the owner and the US DOT number. Drivers should have a DOT medical examination and a driver qualification file should be maintained. Even if you only operate within a single state, intrastate operations, you will need a US DOT number as most states use US DOT numbers for intrastate carriers. Commercial Drivers Licenses (CDL) Do not confuse the requirements for commercial motor vehicles with the requirements for a Commercial Driver’s License. These are two separate issues. Commercial drivers’ licenses are required based on the vehicle size and use. These can be summarized as follows: If the power unit of a combination vehicle exceeds 10,001 pounds and the combination GVWR is 26,001 pounds or greater, A single vehicle that has a GVWR of 26,001 pounds or greater, Is designed to transport 16 or more passengers including the driver Is used for the transportation of hazardous materials in quantity requiring placarding. There are different classes of CDL issued by the states. There are also endorsements that can be applied to the CDL to meet specific regulations. If you have vehicles that are of the size or use that require a CDL, you should review the DOT regulations carefully to assure compliance. Insurance and Regulations Complying with DOT regulations and having the proper procedures in place to meet these requirements is important to your insurance program. Failure to meet the legal minimums for operating your vehicles is a red flag to potential carriers. If the insurance carrier believes that you should have a DOT number and you do not, you must be prepared to address this missing data point. In many cases the insurer is relying on third party reports to make this call. You should ask for a copy of any of these reports, so you have the same information as the insurer. Failure to comply with regulations can be an aggravating factor in claims settlement. If you are responsible for causing an accident, and you are found not to meet the minimum requirements for safe operation, your claim gets more complicated and potentially more expensive. This is a self-inflicted wound that you can avoid. You can check your compliance status using an online resource. Safety and Fitness Electronic Records - SAFER is a portal that tracks fleet related data from the US DOT. You can see your safety rating as well as violation history. This is a tool used by most insurance companies to assess your fleet operations. Getting Help You do not have to become a DOT expert. Most insurance companies offer risk control advice, and many have fleet specialists to help you. You can also reach out to law enforcement agencies and ask for their assistance. Many law enforcement agencies will offer advice and consultation to help you avoid citations. The first step is knowing if you have questions. In the time of “Only buy what you need”, if you don’t know the question, you probably won’t ask. Reach out to us at 513-977-6860 or via the internet at www.driehausins.com We will be happy to help you.

Managing your Workers Compensation (WC) costs is a key risk management effort for any firm. This is a process that must be managed and thoughtfully implemented to be effective. One component of an effective Workers Compensation management program is having an Early Return to Work program. Here are some implementation considerations. EMR Your WC premiums are developed using employee classification codes, payrolls, and your Experience Modification Rate (EMR). A prior article described the function of your EMR and how it impacts WC premiums. Lowering your EMR can significantly reduce WC premiums. Implementing an Early Return to Work program is an effective way to limit WC claims dollars allocated to lost time (payroll to an injured employee while they are not working). Getting injured employees back to work quickly reduces loss dollars which discounts your EMR. Medical Provider Involvement The first element of the program is to have a relationship with a medical provider that supports early return to work and is aware of your program. Getting your medical provider involved immediately in all WC cases allows you and your insurer to manage the treatment for the worker. Using an occupational medical provider can make this process easier. These medical professionals have training and support staff that specialize in occupational medical care. Most large healthcare organizations have this type of practice available. You can also ask your WC insurer for assistance in identifying preferred providers. Insurance Carrier Involvement This program cannot be successful if the insurance company is not on board. You should make this a selection point when considering workers compensation carriers. Have this discussion before you purchase coverage. Case Management A WC case with restricted duty is not a set it and forget it event. Your medical provider and insurer must have a medical case management process. This provides ongoing follow up with the worker to manage their rehabilitation until they return to full duty. Early Return to Work is intended to be a short duration solution to avoid lost time injuries. It will not be effective without proper case management. Identify Early Return to Work Positions You cannot wait until you have an injury to decide to accommodate an early return to work case. You should identify what duties are available within you organization that can accommodate lifting restrictions, mobility restrictions or other medical restrictions. Most firms have tasks that bring value to the enterprise but can be done within a restricted job description. It is key for you to identify these opportunities and have job and physical demand descriptions defined so the medical provider is comfortable in returning the employee to work. Alternate Work Sites If you cannot accommodate restrictions, consider approaching a sheltered workshop in your community to serve as an alternate work site. Most of the sheltered workshops are experienced in dealing with restrictions and disability issues and may be able to accommodate your worker. This is a resource that must be identified in advance and have information available to your medical provider to allow assignment to return to work. Benefits of Early Return to Work It is in your interest as an employer to return workers to productive status as quickly as possible for obvious economic benefits. Having a program that also controls WC expenses by avoiding lost time injuries is an added incentive to implement this policy. Early Return to Work also benefits employees by keeping them engaged and involved. It can be difficult to get a worker back from disability if they are away from the workplace for an extended time. Avoiding the disability period keeps your employee involved, earning a full paycheck and shows your support for them. The program has benefits beyond WC cost control. The Driehaus Difference Selecting and qualifying an insurance company is not a task that most firms are comfortable undertaking. Your need to Have experience in dealing with the different carriers, their claims management practices, their risk control support, and the services they bring to the table. We understand the impact of medical care choices, return to work programs and medical case management on your insurance program and its cost structure. You need a professional resource to help you manage the full spectrum of WC risks and programs. Call us at 513-977-6860 to discuss your needs with our experienced insurance professionals. You can learn about our services and skills by visiting our website: www.driehausins.com. Reach out to us to get the professional assistance you deserve.