The Official Assura Blog
Monday, December 24, 2007
Happy Holidays!
Christmas shopping. Travel. Getting work caught up so that you can take a few days off at the end of the year. Add to that the ever present possibilities of business interruptions or disasters and you might as well not even get out of bed!
It seems as though there is always something to worry us or stress us out. In my line of work, it is very easy to think about all of the things that can go wrong. However, I would like to talk about all of the things that went right this year. (My mother would be so proud of me right now!)
There are a lot of things to be thankful for this year. Here are some of my favorites:
Room In The Inn Program: For several years, hotels such as Holiday Inn Express, Marriott, Hilton, and Comfort Inn make rooms available for free to people who are visiting a friend or family member who is hospitalized or in a treatment center over the holidays. Without this program, some families would not be able to visit their loved ones because of the financial burden. They launched an outreach campaign this year to hospitals and nursing homes to increase awareness of the program.
Youngest Entrepreneur Honored: Jason O'Neil, 11-year-old founder of Pencil Bugs, was awarded the Young Entrepreneur of the Year Award this month by Young Entrepreneurs of America. O'Neil started the business when he was 9-years-old and it has become a sensation. For more information on his invention, you can go to the Pencil Bugs website.
Teen Rescues 4 From a Deadly Fire: Dacreene Shaw, a 14-year-old from Brooklyn, New York, saved four children from a deadly apartment fire. She suffered from smoke inhalation, but has fully recovered.
First Cell Phone College Class Opens: Japan's Cyber University is the first school to offer the first ever university class on mobile phones. Sakuji Yoshimura, who heads Cyber University and gives the mobile course, said the university provides educational opportunities for people who find it hard to attend real-life universities, including those with jobs and those who are sick or have disabilities. (Source: Associated Press)
And last but not least...
Assura Opens In April: While opening our doors may not be on par with the good news events listed above; we are very happy about starting Assura. We are even happier that we have had the opportunity to help our clients and make a positive impact on their ability to handle any business disruptions or disasters. While there were obstacles that threatened to stand in our way, we persevered and opened our doors. It was one of the best decisions we have ever made and we are so excited about our growth. We cannot wait for the new year.
We hope that you have had lots of good news in your life this year. If you get a chance, respond to this blog and let us know about the good things that have happened to you in 2007.
On behalf of all of us at Assura, we would like to wish you and your families a wonderful holiday season!
It seems as though there is always something to worry us or stress us out. In my line of work, it is very easy to think about all of the things that can go wrong. However, I would like to talk about all of the things that went right this year. (My mother would be so proud of me right now!)
There are a lot of things to be thankful for this year. Here are some of my favorites:
Room In The Inn Program: For several years, hotels such as Holiday Inn Express, Marriott, Hilton, and Comfort Inn make rooms available for free to people who are visiting a friend or family member who is hospitalized or in a treatment center over the holidays. Without this program, some families would not be able to visit their loved ones because of the financial burden. They launched an outreach campaign this year to hospitals and nursing homes to increase awareness of the program.
Youngest Entrepreneur Honored: Jason O'Neil, 11-year-old founder of Pencil Bugs, was awarded the Young Entrepreneur of the Year Award this month by Young Entrepreneurs of America. O'Neil started the business when he was 9-years-old and it has become a sensation. For more information on his invention, you can go to the Pencil Bugs website.
Teen Rescues 4 From a Deadly Fire: Dacreene Shaw, a 14-year-old from Brooklyn, New York, saved four children from a deadly apartment fire. She suffered from smoke inhalation, but has fully recovered.
First Cell Phone College Class Opens: Japan's Cyber University is the first school to offer the first ever university class on mobile phones. Sakuji Yoshimura, who heads Cyber University and gives the mobile course, said the university provides educational opportunities for people who find it hard to attend real-life universities, including those with jobs and those who are sick or have disabilities. (Source: Associated Press)
And last but not least...
Assura Opens In April: While opening our doors may not be on par with the good news events listed above; we are very happy about starting Assura. We are even happier that we have had the opportunity to help our clients and make a positive impact on their ability to handle any business disruptions or disasters. While there were obstacles that threatened to stand in our way, we persevered and opened our doors. It was one of the best decisions we have ever made and we are so excited about our growth. We cannot wait for the new year.
We hope that you have had lots of good news in your life this year. If you get a chance, respond to this blog and let us know about the good things that have happened to you in 2007.
On behalf of all of us at Assura, we would like to wish you and your families a wonderful holiday season!
Labels: Misc.
Friday, December 7, 2007
When insurance doesn't come through...
You pay your premiums every quarter or month like clockwork. It isn't always an easy payment for many companies, especially with costly insurance such as flood protection, but you feel confident that you are covered in the event that something should happen.
But can you really feel safe?
Since Hurricane Katrina, there has been a significant increase in lawsuits against such large companies as State Farm and Nationwide for "Bad Faith Claims." Bad Faith Claims are when insurance companies breach their contract with insurers to pay legitimate claims. As a result, many policyholders wait 2-5 years for their case to proceed through the legal system and to receive their money. In this process, it seems that the only people who benefit are the lawyers. But why would this happen? Many say it is really just a profit and expense game where insurers see that it is cheaper to litigate a claim than to pay it up front.
I do not think that insurance companies are always the "bad guys" turning down claims to make a profit any more than I think that bad faith claims never happen. In reality, it is a mixture of both types of situations. However, I do know that insurance should not be the cornerstone of saving a business in the event of a disaster. It is one of the tools available to the business owner and will most likely be the last tool used.
One of the biggest misconceptions about insurance is that as long as a company has business interruption insurance, then they will have all they need to get back up and running without really having a plan that was developed ahead of time.
So let's take a look at business interruption insurance.
Business interruption insurance is insurance that compensates a business for lost income if the company has to vacate the premises due to disaster-related damage that is covered under the property insurance policy, such as a fire. Business interruption insurance covers the profits you would have earned, based on your financial records, had the disaster not occurred. The policy also covers operating expenses, like electricity, that continue even though business activities have come to a temporary halt. It does not tell you the steps you need to take to get back up and running.
What most people do not realize is that many of these policies have a 48-72 hour "waiting period" before a policy kicks into effect. Can you imagine your business being down 48-72 hours before you can even make a claim or having to take the financial hit of losing 48-72 hours worth of revenue that will never be repaid? Then it gets worse. When you are finally at the point you can make a claim, then you have to go through the hassle of pulling together the paperwork needed for the insurance company while dealing with the client and employee issues that come along with resuming operations? I cannot think of too many businesses that can handle this amount of downtime, stress, and paperwork and not want to run for the hills or suddenly find themselves out of business.
So what can be done? Performing analysis that identifies the business processes performed and the assets, people, and records needed to resume operation is a great start to creating a business recovery plan that details how these business processes will be recovered, where they will be recovered, the immediate plan to immediately get back in operation, while phasing in staff and business processes that will eventually return the organization back to normal operations. As you are back up and running, then you will have the time to deal with the insurance companies.
This analysis is also critical for selecting the right insurance policy that will make funds and resources available as you need them. Insurance should never be considered the cure all for any business disaster; it is just one tool of many that can be used to benefit the company. It is important to realize that this tool will take the longest amount of time to produce a benefit even in the best of circumstances. With that in mind, can you really afford not to have a plan?
But can you really feel safe?
Since Hurricane Katrina, there has been a significant increase in lawsuits against such large companies as State Farm and Nationwide for "Bad Faith Claims." Bad Faith Claims are when insurance companies breach their contract with insurers to pay legitimate claims. As a result, many policyholders wait 2-5 years for their case to proceed through the legal system and to receive their money. In this process, it seems that the only people who benefit are the lawyers. But why would this happen? Many say it is really just a profit and expense game where insurers see that it is cheaper to litigate a claim than to pay it up front.
I do not think that insurance companies are always the "bad guys" turning down claims to make a profit any more than I think that bad faith claims never happen. In reality, it is a mixture of both types of situations. However, I do know that insurance should not be the cornerstone of saving a business in the event of a disaster. It is one of the tools available to the business owner and will most likely be the last tool used.
One of the biggest misconceptions about insurance is that as long as a company has business interruption insurance, then they will have all they need to get back up and running without really having a plan that was developed ahead of time.
So let's take a look at business interruption insurance.
Business interruption insurance is insurance that compensates a business for lost income if the company has to vacate the premises due to disaster-related damage that is covered under the property insurance policy, such as a fire. Business interruption insurance covers the profits you would have earned, based on your financial records, had the disaster not occurred. The policy also covers operating expenses, like electricity, that continue even though business activities have come to a temporary halt. It does not tell you the steps you need to take to get back up and running.
What most people do not realize is that many of these policies have a 48-72 hour "waiting period" before a policy kicks into effect. Can you imagine your business being down 48-72 hours before you can even make a claim or having to take the financial hit of losing 48-72 hours worth of revenue that will never be repaid? Then it gets worse. When you are finally at the point you can make a claim, then you have to go through the hassle of pulling together the paperwork needed for the insurance company while dealing with the client and employee issues that come along with resuming operations? I cannot think of too many businesses that can handle this amount of downtime, stress, and paperwork and not want to run for the hills or suddenly find themselves out of business.
So what can be done? Performing analysis that identifies the business processes performed and the assets, people, and records needed to resume operation is a great start to creating a business recovery plan that details how these business processes will be recovered, where they will be recovered, the immediate plan to immediately get back in operation, while phasing in staff and business processes that will eventually return the organization back to normal operations. As you are back up and running, then you will have the time to deal with the insurance companies.
This analysis is also critical for selecting the right insurance policy that will make funds and resources available as you need them. Insurance should never be considered the cure all for any business disaster; it is just one tool of many that can be used to benefit the company. It is important to realize that this tool will take the longest amount of time to produce a benefit even in the best of circumstances. With that in mind, can you really afford not to have a plan?