Category Archives: Innovative National Risk

Weatherproof Your Business

WeatherProofingImage courtesy of The Atlantic

The Insurance Information Institute ( tracks catastrophic losses that are both insured and uninsured. Winter Storm claims rank third behind hurricane/tropical storm and tornado losses. As a business owner preparation will minimize a potential Winter Storm loss.
There are many precautions that a business owner can take to protect their valuable assets; be they property or life. Let’s break the business owner’s responsibility into three categories:

• Property – Personal and Real Property
• Employee Safety
• Customer/Guest Safety


Almost every building in North America is subject to severe winter weather, such as blizzard conditions, ice storms and severe cold. This is true not only of businesses located in the central and northern portions of our country, but also can occur in areas as far south as Texas and Florida. In fact, loss history indicates that the area most vulnerable to damage is the southern portions of the US because they are not accustomed to prolonged cold.
It is very important that every business prepare in advance for the possibility of severe winter weather. The following are areas that need to be checked/secured to prevent unnecessary losses:

• Sprinkler System – they are vulnerable if building temperatures fall below 40°
• Water Supplies – into and out of the building – they are vulnerable if your interior temperature falls below 40°
• Building heating systems – should be checked and serviced each autumn
• Windows and Doors checked for leaks, broken panes or seals
• Roof and Gutters – checked annually for leaks and need for repair
• Temporary heaters – a plan in place to provide heat to the building if the power is out causing the interior temperature to fall below 40°
• Storage for Exterior Property(i.e. chairs, tables) that could be damaged if they are covered under ice and snow

Employee Safety

No one’s life or quality of life is worth an unsafe trip to or from work during a winter storm. As a business owner it is your responsibility to develop a plan for severe weather and communicate your expectations with employees. The plan should be outlined in your employee handbook as well as discussed with employees if bad weather is predicated. You should never leave it up to your employees to guess if it is safe to travel to/from their job.

Customer/Guest Safety

If you are open for business it is your responsibility to provide a safe environment for your customers to come into, purchase your product or service, and exit your business without physical harm. If you are not able to provide this safe environment then you should not be open for business until you can insure their safety. Risk evaluation:
• Parking lot(s) free of ice, snow, and debris
• Walkways to and from your business entry free of ice, snow and debris
• Ice or snow that could fall from your roof onto a customer while entering or exiting your business
• Dry floors inside your business
• Mat for customers to dry their shoes when they enter
• Help escorting customers to their vehicles if necessary
• All parking lots and walkways should be constantly checked to insure they remain in a safe condition
• All floors should be constantly checked and cleaned of water that may have melted off customer’s shoes
• Offer to call a taxi if the roads have deteriorated while the customer is in your business and they no longer feel they can safely drive home

A few simple preparations can help your business, employees, and customers survive a Winter Storm without damage or injury. For more information please contact:

– Mona M Carpenter

Liquor Liability – The Facts

Liquor liability insurance is defined as coverage for bodily injury or property damage caused by an intoxicated person who was served liquor by the policyholder. The breadth of liquor liability coverage varies by state because each state has its own interpretations and evidence requirements of who is legally liable in the event of an injury to a third party.

  • Dram shop liability or social host liability, holds a social or commercial host liable for injuries inflicted on a third party by an intoxicated guest of the host’s event or establishment.
  • Forty-four states and the District of Columbia have enacted dram shop liability laws or statutes that extend to social or commercial (retailers) hosts.
  • In some states, every bar in which an intoxicated person drank can be pulled into a lawsuit if the person causes bodily injury to a third party. The establishment must prove that the patron was not or did not appear intoxicated while there.
  • Other states require proof that the establishment sold alcohol to the intoxicated individual, injuries were sustained, and the injury was the direct result of the individual’s intoxication.
  • The Center on Alcohol Marketing and Youth (CAMY) report states that 54.3 percent of binge drinkers who reported driving after their most recent binge drinking episode drank in an on-premises, retail alcohol establishment such as a bar, club or restaurant.
  • In February of this year, ISO (Insurance Service Office) revised the liquor liability exclusion contained in its general liability forms to address “bring your own” alcohol establishments. The new exclusions now have an exception for insureds that are not considered to be “in the business of serving, selling or furnishing alcohol under the scope of the liquor liability exclusion simply by allowing someone to bring and consume their own alcohols on its own premises.
  • Many insurance companies offer discounts on liquor liability coverage to establishments that provide alcohol awareness education and training to employees.

The bottom line for business owners who serve alcohol – You will be held responsible if guests are served alcohol in your business and then go on to cause property damage or bodily injury. So, what can you do to protect yourself?

  • Train your employees above and beyond what your state requires for alcohol awareness.
  • If you don’t have video surveillance in your business consider getting it. It may give you a defense for liquor liability, general liability, and employment practice litigation.
  • Empower your employees to follow all state regulations to avoid over serving any guest in your business, including employees/owners who are off duty.
  • No patron’s business is more important than strictly following state dram regulations. A few extra dollars in the till at the end of the night will never be worth the devastation from a drunk driving incident.
  • Please contact us at 214-216-0225 or email Mona Carpenter at if you have any questions.

But My Agent is a Good Customer

We hear this statement from restaurateurs every day. While patronizing our clients is very important, we do that not because they are clients, but because they provide an extraordinary dining experience.

For the most part, the restaurant industry has narrow margins (10% to 15% is average). Below are the primary costs and optimal percentage of total sales that most profitable restaurants strive to maintain:

• Prime Costs          (Food and Payroll) 60% to 65% of total sales
• Management Salaries         10% or less of total sales
• Occupancy         10% or less (rent, CAM, Insurance, and taxes)

Let’s look at Occupancy costs since that includes the cost of insurance for the business. Those are the costs most business owners find the least “interesting,” however, a shift in just a few percentage points can quickly rock your profitability up or down.

Here is a real example of a recent situation we had in our agency. The owner of a fine dining restaurant in our city was contacted to discuss the insurance on his business. He said he would allow us to “bid” his insurance even though his current agent is a friend and a “good customer.” While meeting with him we did a risk assessment and gathered all of his insurance policies so that our team could review his current coverage. The following was the result:

• Double coverage that was costing him $3,500 per year
• Grossly under insured limits on Employment Liability protection
• Inaccurate sales figures
• Inadequate property protection
• No risk management training of his management team for Employment Liability
• No training of his management team for emergency situations
• No procedures in place for reporting and capturing incident reports for potential lawsuits
• Insurance cost savings of 17% or about $13,000 annually

Now my question to him is, “Did you hire the best insurance agent your money can buy?” If your typical profit margin is 10% is your current agent spending more than $130,000 per year in your restaurant? Can you afford to keep your “friend” as your agent?

If you would like us to review your current insurance program to see if your “agent friend” is doing the best for you, please contact us at 214-216-0225 or email Mona Carpenter at

Food Borne Illness

Market fruits and vegetablesYou buy only the top quality produce, proteins, and dairy from the best suppliers. Your restaurant has had rave reviews from your local press and even Zagat’s is saying very good things about you, your chef, and level of service. Everything is going beautifully and then the worst case scenario happens. You get a call from three customers who dined at your restaurant 14 to 25 days ago. All were hospitalized after eating at your establishment and the doctors tell them they have ingested a dairy product that contained a strain of listeria monocytogenes. They believe it came from the lasagna they ate at your restaurant during their last visit. Their doctors said the CDC (Center for Disease Control) has reported that there has been a recall of ricotta salata cheese from a specific manufacture that is known to supply your restaurant. What do you do now?

Does your business have procedures set in place to manage this PR nightmare? Do your employees understand what they should and shouldn’t say to the press and customers if there should be more calls with additional reports? And furthermore, financially what should you do? How should you communicate with your local and state health departments?

Typically Commercial Property and Casualty insurance policies do not offer business interruption coverage for food borne illness outbreaks. These policies are designed to respond to events involving physical damage and claims for medical injury and lawsuits associated with physical and emotional injuries. They may offer some coverage in the event a customer is hospitalized, however they are not designed to cover expenses that are going to continue regardless of whether the restaurant is open or closed.

The impact can be devastating to your revenue while you work through the press and government inquiries and requirements. Do you have the capital in reserves to enable your business to keep key employees and cover ongoing expensed. Below is an example of a typical financial impact of the effects of an outbreak:

Chart of Financial Impact of a Food Borne Illness Outbreak

Chart of Expenses When Revenues Drop

If you want to know whether or not you are prepared for a worst case scenario situation, please contact our office. We will be happy to audit your Business Interruption and General Liability policies to give you piece of mind should a food borne illness Outbreak should hit your business.

Please contact us at 214-216-0225 or email Mona Carpenter at if you have any questions.