Short Post - I have injured my back and typing is painful.
THE GOLDEN RULE OF SALES. I heard it again this morning and it rang true once more....
GET OUT THERE>
RECOGNIZE OPORTUNITY.
KNOW WHAT TO DO ABOUT IT.
Happy Fouth of July to all......celebrate your freedom!
]]>So many of you have asked me questions about what to do when you are starting a new business.
Here are the steps that I would suggest that you take.
1.If you have any sort of Homeowners or renters insurance, start there. The basic policy usually EXCLUDES all forms of any business that you are operating out of your home or apartment. That means if you use your home computer for business and it is stolen, it would not be covered. That means if someone is visiting you at home for business purposes and they are injured (a client or the UPS man or a vendor) and they sue you, you have no liability coverage.
HOWEVER, most homeowners policies will add an endorsement for a very small amount that will add your business to your homeowners for BASIC property coverage and BASIC general liability coverage. They may even add some Business Interruption coverage. This will NOT give you Professional Liability coverage so if you are consulting or designing something you still need another kind of policy, but it is a place to start and it is reasonably priced. Your current agent can most likely do it for you.
2. Next option for Professional Liability is if you belong to an Association or group (like Sabrina belongs to an association of professional trainers). This might be a good place to get reasonably priced group insurance. However, as soon as you add a website, be sure that your policy does not exclude Internet activities. If it does, then you will need to add a Cybernet and Technology Policy. This will be priced on your revenues. So it will NOT be very expensive for you when you first start.(if you were buying it right now in this soft market, for MOST of YOU probably less than $500 your first year).
You will probably be looking at a policy at a limit of 1,000,000 and with deductibles of 2,500, 5,000 and 10,000 depending on what you do.
3. If you don't belong to any associations, go straight for an agent that specializes in your class of business. Or for an Insurance Consultant that will search the market for someone who IS a specialist in your class of business! That is the best way to be sure that you are getting the BEST price and the BEST coverages! If you don't know any, ask others in your field or ASK ME!!!!!
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No blogging from me for a few days...I am off today for Inner Circle in Las Vegas!! For those of you who don't know what this is...It is first of all, a solid day of Kevin Hogans time on Sunday. We never know in advance all that the day will hold. Sometimes an interesting guest. Usually several Business Storms for several of the InnerCircle Members who are starting new businesses or who are branchingin new directions. Sometimes Kevin sharing his latest ideas.
But it is always a jam-packed day of ideas, fun and enlightenment.
We usually go a day in advance and some stay another day. Some bring spouses. We have gotten to know each other and some are planning business ventures together. Some just like to chat and catch up about live! So we plan lunches and dinners and shows together...and we talk,talk, talk.....mostly about our internet businesses...."have you seen this site, read this book, been to this seminar".
The first time I was at an Inner Circle event, I went to dinner with a few others and we sat there til 11pm chatting about our businesses....a lonely single guy at the table next to us sent us a complimentary bottle of wine at the end of evening saying that he had so enjoyed listening to our conversation!!! I guess we were pretty engrossed in what we were saying! We hadn't even noticed him or wewould have invited him to join us!
The day after I return I am off to Austin to (hopefully) close a big sale....I will certainly be in PEAK condition (don't you pity the buyer???)....so you probably won't hear from me again til next Thursday.....everyone have a WONDERFUL week.....
]]>October seems a long way off but with what I had to pay for my last airfare to Vegas, and the fact that my boyfriend is planning to come along for the first time in October, we went on line last night to check out the airfare. We even used ths new link that the The Road Warrior told us about. But OUCH! The best fare we could come up with was still more than a $140 a piece what I had paid for this last trip! Then we looked at using frequent flyer miles and it would have cost over 100,000 FF miles for the both of us.
Knowing that hotels will be most likely more not less in October than in the summer, we decided to get a little creative.
First we checked other than non-stops. They were awful.
Then we checked flights from other major cities a few hours away. THIS was enlightening! We found fares that were as much as $250 less a piece. And we found them on a much nicer airline (Midwest Express, all seats first class, home made cookies, etc) For us, with enough planning, we can visit clients and prospects in that city and make whatever additional expenses....gas, food, even an overnight stay if we choose....a reasonable proposition.
Just wanted to give you all some ideas as you look ahead....gas prices are going to impact all of us and how we plan and do business!
]]>A little light reading for your summer beach trips!!
1. I included this Video in my favorites for Sabrina....it has some fundamentals for coaches on negligence and emergency plans and also risk management audits.....and it was put together by coaches. So it has a slant towards Risk Management for anyone in the Fitness Industry or Sports Industry.
2.Detailed examples of Risk Management Programs at companies like Chase, Dupont and Microsoft. Interesting reading to see how a well constructed program actually works!
3.Analyzing how companies are approaching risk today as opposed to how they have done so in the past.....the need to be more accountable to ALL forms of risk.
4. This CD is strictly for financial folks and for the stock market...but it has some very interesting Risk Management techniques none the less.
5.This one is a repeat of number one and was supposed to be "Controlling the Controllable: the management of Safety" While an expensive book ($170), it is a very practical guide to the latest techniques in Risk Management. by Dr. Jop Greneweg. This is available at Amazon.com.
6.This is a magazine specifically for buyers of insurance.....full of information !!!!! You can order a sample copy for free if you want to see if it's for you.
As you can see, I strove for variety!!!!!!
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What keeps you awake at night?
Do these things? They should!
1. NOT BUYING BUSINESS INTERUPTION INSURANCE
A friend, not a client... and I were talking the other day about Business Interruption insurance and he said, I am not sure if I have that or not. And I told him that he was far more likely to need it than the other forms of Property Insurance that he probably DID have. And then he said, Well, I probably can't afford it. And then I told him that it was really cheap, pennies for a rate, a lot cheaper than his property insurance and that it would cover the LOSS OF HIS PROFIT on his business in case of fire, tornado, snowstorm, flood, etc...AND THAT THE LACK OF IT WAS ONE OF THE PRIMARY REASONS FOR BUSINESS FAILING!
And then he asked the most important question...Why hasn't my agent ever told me about it? I sighed and said, 3 reasons, because it is complicated to explain, the application is long, and the price is low (and thus a low commission for the agent in return for a lot of work).
2.PUTTING YOUR LIMITED RESOURCES INTO THINGS LIKE LOWER DEDUCTIBLES INSTEAD OF HIGHER LIMITS
Let's admit it, all business people try to be smart about how they spend their insurance dollars. But you SHOULD take the highest deductible that you can reasonable afford (and ask for options on this)....and then use THAT savings to buy higher limits (increase your general or professional liability another million).
3.NOT BUYING THOSE ENDORSEMENTS THE AGENT RECOMMENDS OR EVEN ASKING WHAT THEY ALL MEAN OR ASKING FOR EXAMPLES OF WHEN THEY MIGHT BE USEFUL, LIKE:
DOC DRIVE OTHER CAR THIS IS THE ENDORSEMENT ON THE BUSINESS AUTO POLICY THAT BROADENS IT TO MAKE IT AS BROAD AS A FAMILY POLICY.
If your vehicle is title in your business name (and there are good tax reasons why that might be a good idea), then you should carry the insurance on a Business Policy. But if you have no other personal auto policies, and neither does your spouse, then you need to add DOC to your Business Auto Policy (it costs about $100). You can add both you and your spouse, and if you have other employees with business autos, you can add them as well. Without it, you have gaps in coverage.
4. NOT TELLING YOUR AGENT THAT YOU ARE GOING TO BE DOING SOMETHING DIFFERENT IN YOUR BUSINESS NEXT YEAR THAN YOU DID LAST YEAR.
Why is this a problem? Different activities are rated differently by different insurance companies, and when it comes time to audit, you may end up with an unpleasant surprise at what your company decides to charge you for this operation. Also, this class of business may be something that your insurance company does not ever care to cover and then they could even cancel you mid term! So if your agent knows what you are going to be doing you will have the right insurance for everything you do or might do!
5. BUYING A GENERIC POLICY WHEN YOU ARE IN A SPECIALTY FIELD.
Whoops. This is the easiest mistake for a non-insurance person to make. How would you know the difference anyway? so let's say you buy from someone who just started selling insurance and THEY don't know that there is a specialty policy for what you do! You can avoid this by asking others in your field/industry where they get their insurance.
Sleep better tonight!!!!
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Kevin Hogan has a quote, that I am sure we have all heard before, that 9 out 10 new business fail. Most in the first year. Kevin states how vital it is to have someone who has done it successfully to show you the ropes, to give you a plan, so you WILL NOT FAIL..
He is right.
But let's examine some of the other reasons a business fails.
Loneliness.
Yeah....if you are a sales type and were use to being part of a gregarious team and are now on your own....writing a book, developing your own company, grappling with your own company, facing stark terror on your own as you sink or swim, it can be lonely!! And often there is no one to even share the big (or little )successes with!
Which is why it is SO important to develop a group, even if it is small of supporters, right from the start, who will share your successes. Other small business owners in your industry ....in your association....even if they are "on-line" friends, they can help to combat that "no one else knows what I am gong through" desperation of the first few months.
Secondly, it is the sheer VOLUME of things that the small business person does not know, things like insurance, marketing, branding, corporate law, how to stay in balance physically, how to dress effectively, how to keep their personal life going while their business is growing....oh! Right! These are the things that all of us are offering people! Which is why we have a tremendous opportunity to become essential partners at a critical time in a persons business life!
Stay inspired, stay focused....what you do is valuable!
Sonya Lenzo
The Business Insurance Expert
]]>Many of you have raised this question lately.
And it is a fair question, particularly since there have been stories in the press of bid-rigging among major brokers, and insurance executives going to jail for fraud due to how they charged their clients in the past few years!!!
And then there are the issues of how agents try to confuse things with terms like, commissions , fees and contigencies......do you EVER know just how much your agent is actually making from you???
Well, there are two ways for you to determine this.
One is to simple ask. You say to your agent, I deal with all my professional relationships (doctor, lawyer, CPA, etc) on an hourly fee basis and with full disclosure of fees. So I believe that our relationship should be equally as professional, don't you? No decent agent/broker will disagree with that. Then ask them to fully disclose in writing to you whatever fees, commisions and contingencies they are making on anything that they are quoting you. Tell them that you are requesting the same from anyone else that you taking bids from and it is simply how you do business. If they refuse to do business with you that way, get a different agent.
The second way is to hire a consultant. They will charge you either an hourly fee or a per services fee and THEY will require that every agent/broker quote your business net of commisions plus a fee and then disclose exactly what you are getting for that fee. Then they will advise you on which bid to take and why.....and give you their unbiased opinion as to why that is the best quote for you.
Many, many businesses are going this route....both large and small. The money they save and the time they save more than pays for the consultant's services. And the bad press that the insurance industry has gotten has quite frankly driven them to it!!
Some of the most experienced agents have now chosen the route of consultancy because they can best serve their customers from the position of unbiased advisor.....it is truly where "EXPERIENCE COUNTS!"
I am posting consulting fees on my website today BUT for those of you in this course those fees would be discounted. If you check out (and I use paypal).....put in discount code KHC123 and get a 50% discount on all fees listed on my website for the next year or just email me at smlenzo@yahoo.com.
Sonya Lenzo
The Business Insurance Expert
]]>Professional Liability Insurance, that is.
We are on one of my pet peeves today. As a typical non-insurance person, or business person, you most likely do not know, that the basic General Liabilty policy, that policy that you are relying on to cover you in case you get sued, has an exclusion in it for Professional Liability.
So unless you have added an endorsement or bought a special policy, you have no coverage if you do any of the following things and are sued for them or cause harm to someone by doing them:
1. Give professional advice (in person or over the internet or by mail).
2.Design or build a product or modify a product in any way.
3. Sell a product that was manufactured in a country other than the United States.
4.Perform creative services of any kind for anyone.
Some of these things are perhaps a "gray" area.....which is exactly where YOU don't want to be when a claim occurs.
Why is it that you don't know this?
First, because you aren't the expert. Secondly, because most agents don't WANT to sell Professional Liability policies.....the applications are long and the commisions and premiums are low. Which is no excuse for you not to have the coverage you need to protect yourself and your business!
If you ARE a professional, get this coverage! The discouraging thing is, you are going to need to read your policy to see what coverages you have.....or find an agent you can trust!!
]]>1. First and foremost, if cost savings and a truly fresh approach is your objective, you MUST get a bid from a different broker UNLESS you have formed a partnership with your broker and have absolute confidence in him/her and feel that there is nothing about your program that could be improved. If your broker says they can "shop the market for you", they will bring you back what THEY feel is in your best interest, and you are "trusting" that it is. It may or may not be. That's a lot of trust. It most likely is NOT the most competitive product. I can guarantee that.
2.Every insurance company, every year, has an ideal company, or target class of business that they are pursuing. If you fall in that class this year, you are "hot". That is why it is vital that your broker know all the markets and what they want THIS YEAR and if you might be better off with another market.Also, each year, every insurance company comes out with new endorsements to attract specific classes of bussinesses. Which is another reason that your broker needs to know who is looking for you!! Otherwise, all things being equal, you are most likely best off where you are....unless there is a reason that you might have pissed off your current carrier that you don't even know about it....so if your broker says...I would like to move you this year...ask why...is it because another carrier is giving HIM double the commision for your business or is it because YOU are going to be getting a better deal? ASK QUESTIONS!!
3.The above raises a question that is truly troubling for consumers. Not all insurance companies pay the same commisions and some brokers move business because the sad truth is that most companies pay HIGHER commissions on new business than on renewal business. So if your broker moves you to another company, he will be making more money on your renewal (in most cases). Also, while this practice is fading due to very bad press, some carriers still pay large contingency fees based on the overall book of business that an agency has.....so if they are short near the end of the year, the agency will move business to a carrier to meet their quotas and get a contingency check (these checks are in the 100,000s of thousands of dollars).So again, watch for being switched from one carrier to another without a very good reason, particularly if your renewal is in the fourth quarter.
4.Almost all companies are negotiable on many more items than the consumer realizes if they would only ask. Your broker can negotiatie just about anything on your behalf unless if is outside of the filings of the carrier, if he so wants to, and if it makes underwriting and financial sense.So if there is something about your program you don't like, ask to have it changed. Your deductible? An endoresement? Some wording? The payment plan? Nothing ventured.....
5.Your sales and payroll can be adjusted midterm not just at the end of the policy term by audit. All it takes is an endorsement. So if you have a big layoff, or any other huge change in your business and you don't want the surprise of that nasty audit bill, or you don't want to wait for a big refund 90 days after the policy is over, call your broker and ask for an endorsement to be filed NOW adjusting the sales and payroll and tell him why. The change can take place immediately and your remaining installments can be ajusted.
6.Your broker should be your business partner, like your lawyer, your CPA, etc. and should be involved in at least quarterly meetings about what is going on in your company, so that can assist you in what insurance exposures you might need to be thinking about for the future. This is their job! Not something extra!
7.There are also a host of other jobs your broker should be performing for you without being asked: assisting you in setting up a Crisis Management Plan for your company if you don't have one, analysis your losses and helping to solve them (ie their is a SIMPLE solution these days to Repetitive Motion claims and if your agent has not talked to you about it, call me!), talking to you about every possible money saving idea they are aware of not only relating to insurance but also to your industry.
Is your broker doing this?????
If not call me
Sonya Lenzo
The Business Insurance Expert
see my video at You Tube "Lenzo Insurance"
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