4D — May 13 - 26, 2016 — NJAA CONFERENCE & EXPO — M id A tlantic
Real Estate Journal
www.marejournal.com
By Neil A. Owens, Elias B. Cohen & Associates Uninsured: Real perils that can put your assets at risk 2016 NJAA C onference & E xpo
A
n owner asked me re- cently to review their insurance program to
umbrella liability, and work- ers’ compensation has not changed much over the years.
cyber deception (aka social engineering), Employment Practices Liability and Tenant
more transactions taking place via the web, breaches are in- evitable. Liability frequently resides with the holder of the breached information at the point of breach even if a vendor or some third party was at fault. Expenses include forensic investigations, legal counseling, and notification costs. Be wary of the throw- in limits attached to package policies, they are an attempt to further clarify that such losses are not covered under the main policy form. Beware of the recent court decision that found coverage under a General Liability policy, as
you can be sure insurance car- riers will take the steps neces- sary to ensure their intent to exclude data breaches under such policies in the future. Pollution Liability addresses bodily injury claims and reme- diation expenses related to a pollution event. With asbestos, mold, lead, and most any pol- lutant typically excluded from coverage, a pollution policy can address some of the cata- strophic liabilities an owner is exposed to. Crime Insurance needs an- other look. More than ever before, cyber deception is leading to voluntary parting of funds via wire transfer. This exposure is not covered by most policies; however, special endorsements are now avail- able to address this exposure. While these scenarios make headlines, the leading cause of crime losses remain the tra- ditional employee dishonesty scenario. Employment Practices Li- ability Insurance (EPLI) pro- tects an employer when allega- tions of wrongful employment practices are made. Be sure to include coverage (at least legal defense coverage) for FLSA and related state wage & hour allegations. The wage & hour exposures are substantial and the industry is facing a real crisis if left unmanaged. All owners and managers should have an audit of their compli- ance in this area done with particular attention paid to exempt versus non-exempt, OT calculations, rent allow- ance, on-call record keeping, and many other standard industry practices. Similarly, careful attention should be paid to 1099 subcontractors as the department of labor and workers’ compensation carriers are focusing on them and whether it is proper or whether the worker is really an employee. Tenant discrimination in- surance protects an owner and manager against allegations of wrongful discrimination of a tenant. Coverage should include allegations of financial discrimination, not always a covered protected class. Like so many areas in the industry, insurance program design has evolved to keep up with the times, and owners should ensure that their pro- grams have evolved as well. Neil A. Owens is senior vice president at Elias B. Cohen & Associates. n
verify that it is appropri- ate for their needs. Unfor- tunately for the owner , the rev i ew exposes sev- e r a l a r ea s that lack in- surance protection. How can this be? Some things for property owners stay the same. The need for property, boiler, gen- eral liability, auto liability, Neil Owens
“Like so many areas in the industry, insurance program design has evolved to keep up with the times, and owners should ensure that their programs have evolved as well.”
For the owner that inquired, the traditional policy array was in place. However, expo- sures have evolved requiring an owner to include the fol- lowing insurance policies as a necessary part of their insur- ance program: Data Breach Expense & Liability, Pollution Liability, Crime including
Discrimination. What are these policies, the owner asked? The Data Breach Expense & Liability policy protects an owner (and manager) for expenses and liability associ- ated with a data breach. With more information than ever being stored in the cloud, and
Our Safety Group members saved over
in the last 8 years on Workers Comp costs. How much did you save? $ 1,662,554
Significant upfront discounts on Workers Comp! Declared dividends six years in a row! *
For further details on how to gain the rewards of participating in the new Professional Real Estate Owners and Managers Association Inc. Safety Group #204, please contact: Neil Owens, CIC, Esq. Safety Group Administrator neil_owens@cohenins.com Tel: 973-403-9500 • 800-277-9505 Fax: 973-403-7755
Savings on the cost of Workers Comp coverage are now possible for eligible members of the NJAA who join our unique Workers Compensation Safety Group. Participation also offers these advantages: • Up front discount – most other carriers have reduced or eliminated managed care and other credits • Potential dividend based on experience of this large group – 6 year average of declared dividends is 8.00%* • Easier audit process due to calendar year policy • Customized risk management with the insight of E. B. Cohen experts
1250 Broadway, 36th Floor, New York, New York 10001 • 212-977-9500
Insurance Agents Brokers, Consultants & Risk Managers for the Real Estate Industry
*Past performance is no guarantee of future results. 2015 to be declared December 2016.
101 Eisenhower Parkway, Roseland, NJ 07068 • www.cohenins.com
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