Typically, insurance policies (e.g., homeowners, automobile, and watercraft) include initial limits of “primary” liability that responds to legally based judgments against you or your family members. However, these are commonly limited to $300,000 or $500,000, making them inadequate in today’s litigious society where multi-million dollar judgments are all too common: these judgments are based on current and future earnings. In that event, an Excess Liability or “Umbrella” policy kicks in when a lawsuit judgment exceeds the limit on your homeowner’s and auto policies.
A key strategy in wealth preservation is the maintenance of comprehensive personal liability protection. That’s why we urge our clients to consider the maximum net worth they are willing to risk should such lawsuits occur. Our agency has the ability to place up to $100,000,000 in personal umbrella policies, and our recommendation is to maintain Excess/Umbrella Liability protection at a minimum limit of $5,000,000.
We believe there are two key components that, whenever possible, be included in a comprehensive Excess/Umbrella policy:
Uninsured/Underinsured Motorist – This important protection is provided under most primary Automobile policies. It ensures that a household member will be covered for injuries he/she receives from a negligent driver. In the event of a qualifying accident, the insurance company will pay the difference between what the uninsured/underinsured driver can pay and what the injured driver would be entitled to as if the uninsured motorist had proper insurance in effect (covered also applies in “hit-and-run” accidents). We encourage every client to purchase additional limits of protection, which are available as an endorsement to the Excess/Umbrella policy. This additional protection covers the bodily injury damages they cause you or a family member.
Ensuring a Proper Defense – Most clients are unaware of how their defense would be managed by their insurance company in the event of a lawsuit brought against them or a family member. Three specific items to request include:
- Outside the Limits – All covered defense costs are “outside” the limit of Excess/Umbrella coverage, thus preserving the full Excess/Umbrella coverage limit for judgments against you.
- Expanded Defense – A sub-limit of coverage will apply to the reasonable expenses for your preferred law firm to review and consult on the defense offered by the policy.
- Reputational Damage – Some policies will also provide a sub-limit to cover the fees of a public relations firm to protect your reputation within your community.
Our clients’ needs evolve over time so we want to reinforce the following coverage options that could be critical to maintaining a proper Personal Liability Program. Please make your insurance advisor aware of any related exposures that you or a family member may have to any of the following:
- Trusts, Estates, & LLC’s – If your properties, vehicles, watercraft, or aircraft are owned in the name of an entity created for tax or liability purposes, be sure the entity is named on your Primary and Excess/Umbrella policies as an Additional Insured.
- Non-Profit Director’s & Officer’s Liability – Protects unpaid board members or trustees of charitable organizations against lawsuits involving a variety of wrongful acts such as sexual harassment, discrimination, libel, slander, invasion of privacy, wrongful termination, and plagiarism.
- Family Trust Liability – Covers damages resulting from a negligent act, error/omission, or breach of duty while serving as a trustee of a family trust.
On March 7, 2019, the U.S. Department of Labor (DOL) released its long awaited proposed rule to amend current overtime regulations. Specifically, the proposed rule would raise the minimum salary threshold under the Fair Labor Standards Act (FLSA) “white collar” exemption to $35,308 per year ($679 per week). The proposal does not call for automatic adjustments to the salary threshold; however, it does propose updates to the salary threshold every four years.
Currently, employees with a salary below $455 per week ($23,660 annually) must be paid overtime if they work more than 40 hours per week. Employees making at least this salary level may be eligible for overtime based on their job duties. This salary level was set in 2004.
Full information about the proposed rule is available here.
The public will now have 60 days to submit comments about the proposed rule electronically at www.regulations.gov. The DOL will take time to review submitted comments and an effective date for the final rule is not expected until 2020.
Gulfshore Insurance will continue to monitor any updates to the FLSA exemption rules and provide updates as they become available.
The National Flood Insurance Program (NFIP) just announced changes effective April 1, 2019 and January 1, 2020. The changes outlined below apply to new business and renewals that will become effective on or after April 1, 2019. The premium changes for Preferred Risk Policies (PRPs) and Newly Mapped procedure policies will become effective January 1, 2020.
Premium Increases and Surcharges
Average increase of 7.3%. These amounts do not include the HFIAA surcharge or the Federal Policy Fee (FPF).
For policies issued on or after April 1, 2019, there will be no changes to:
- Deductible Factors
- Federal Policy Fee
- Reserve Fund Assessment
- HFIAA Surcharge
- Probation Surcharge
Pre-FIRM Subsidized Policies (a group of policies in SFHA Zones A, AO, AH, A1-30, AE, A99, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/A, V1-30, and VE, that receive rates insufficient to pay the anticipated losses and expenses for that group)
- Other Pre-FIRM Subsidized Policies Not Subject to 25% Annual Increases: These are primarily condominium policies and multifamily policies. Premiums will increase 9%, with a total amount billed increase of 8%.
V Zones (coastal high-velocity zones)
- Rate increases are being implemented again this year as a result of the Heinz Center’s Erosion Zone Study, which clearly indicates that current rates significantly underestimate the increasing hazard from steadily eroding coastlines.
- Post-FIRM V Zones: Premiums will increase 6%, with a total amount billed increase of 6%.
A Zones (non-velocity zones, which are primarily riverine zones)
- Post-FIRM A1-A30 and AE Zones: Premiums will increase 4%, with a total amount billed increase of 3%.
- AO, AH, AOB, and AHB Zones (shallow flooding zones): Some policies within this rating category will have premium changes; however, for the entire category the average premiums and total amount billed will remain unchanged.
X Zones (zones outside the Special Flood Hazard Area)
- Standard-Rated Policies: Premiums will increase 1%, with a total amount billed increase of 1%.
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NAPLES, FL (November 20, 2018) – Gulfshore Insurance, a Florida-based insurance agency, is pleased to announce Jeffrey Sanders has been certified as a Transportation Risk and Insurance Professional (TRIP™). This insurance designation recognizes specialized expertise in transportation insurance and establishes one’s commitment to the transportation industry through an on-going continuing education component focusing on transportation risk and insurance.
“The TRIP program has helped us show our transportation clients and prospects that we understand their most important insurance needs,” said Brad Havemeier, President and CEO of Gulfshore Insurance. “Jeffrey has further strengthened our agency with the specialized knowledge necessary to provide superior risk management and insurance advice and service to our transportation clients.
The TRIP continuing education program is a specialized curriculum consisting of five, self-paced courses presented entirely online. Only those who complete these courses and maintain their knowledge with an ongoing continuing education program are entitled to display the TRIP designation to certify their knowledge of transportation insurance. For more information about the TRIP continuing education program and designation, visit www.TRIP-CE.com.