How using a surety guarantee can enhance your client’s liquidity - Shield Insurance Agency Blog

How using a surety guarantee can enhance your client’s liquidity

What is a surety guarantee?

The surety is the guarantee of the debts of one party by another. A surety is an organization or person that assumes the responsibility of paying the debt in case the debtor policy defaults or is unable to make the payments. The party that guarantees the debt is referred to as the surety, or as the guarantor.

How do you get a surety guarantee?

When companies need a guarantee, they often turn to their bank. And whilst this may seem to be the simplest approach, decision-makers should understand the other options available to them—mainly purchasing surety from an insurance company. One key reason? To free up liquidity.

When companies obtain a guarantee from an insurance company, they don’t use up any of the limits under their bank lines, giving them additional credit to use in other ways to support their business. Often, insurance companies have better credit ratings than banks, a key factor when getting clients to accept guarantees. Two examples of guarantees that can free up cash include pension bonds and payment services regulation bonds.

Pension guarantees ensure that a corporation’s pension scheme is being funded, whilst at the same time deferring the actual cash payments. When a business chooses an insurance company for this type of guarantee instead of a bank, it keeps its credit lines available with its bank and frees up the cash it may have had to put into the scheme, keeping cash in the business. Additionally, if the company becomes insolvent, the surety company will ensure appropriate payments into the scheme—maintaining the same protections for employees. Per recent legislation, directors could soon be liable if they take the appropriate steps to protect their employees’ pension plans.

As organizations look to address this legislation, firms and insurance brokers should be aware of how a surety company can help.

Payment services regulation guarantees, similar to money transmitter bonds in the U.S., are needed primarily by financial and technology companies that process people’s money (e.g., PayPal, Worldpay). This type of guarantee allows any guaranteed funds to be exempt from the requirement to be ring-fenced from the companies’ cash, increasing the companies’ working capital and supporting their business. Similar to a pension bond, it also protects customers should the companies become insolvent and puts them in the same position as they would otherwise have been in.

In addition to enhancing liquidity, another reason companies should consider a guarantee from an insurance company is the spread of risk. Historically banks and insurance companies haven’t always been on the same economic cycle. Should there be a recession or the banking market is having trouble, an insurance company may not necessarily be experiencing the same challenges at the same time as the bank. Having a mix of bank and surety providers allows your business to grow.

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Shield Insurance Agency Meijer Gift Card Winner

Gift Card Winners Compliments of Shield Insurance Agency!

Friday, October 22, 2021

Every week, Shield Insurance Agency draws a winner of a local gift card from its clients and social media followers.

Be sure to LIKE our Facebook Page to get yourself entered to win and see who the winners are!

Shield Insurance Agency has given away thousands of dollars in local gift cards over the last 20 years serving Michigan.

Shield Insurance Agency Lowes Gift Card Winner!
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Your Referrals to Shield Insurance Agency Help a Local Family in Need

Shield Referral Program Supports Local Family

Shield Referral Program Supports Local Sparta, Michigan Family

Your Referrals to Shield Insurance Agency Help a Local Family in Need

Your referral can make a difference for Roslyn and Maddox who both have a form of Arthrogryposis Multiplex Congenital. Shield Insurance is helping this Sparta, MI family by donating $25 for each non-client who gets a quote from us.

No purchase necessary!

CLICK HERE to get a quote and we’ll donate $25 to them! (Be sure to mention Roslyn and Maddox in the comment section!) You can also call or text the office (616) 896-4600 and one of our agents will take a few minutes of your time to offer up a quote. Don’t forget to mention Ros and Maddox

“The highest compliment we can receive is the referral of your friends, family & business associates. Thank you for your trust!”

Meet Roslyn
Roslyn and Shield Insurance Agency Referral Program

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Staffing Shortages May Affect Your Next Trip - Shield Insurance Agency Blog

Staffing Shortages May Affect Your Next Trip

Pack your patience as the travel industry struggles with staffing shortages.

by Bill Fink, AARP, October 13, 2021

Staff Shortages due to the pandemic.

Due to the tourism slowdown at the height of the pandemic, many airlines, hotels, restaurants, and attractions cut back operations, laid-off employees, or closed altogether. Now, as travel has begun to rebound, many of those businesses find themselves short of staff and resources. Travelers are feeling the pinch — both in the pocketbook and in the planning process — with lower inventory for accommodations (sometimes due to a shortage of housekeeping staff), longer wait times for services, limited opening hours at restaurants, and higher prices in many popular destinations.

It’s even resulted in at least some flight cancellations: Southwest grounded one-third of its planes on Oct. 10, with 1,900 canceled throughout that weekend. Airline officials cited staffing challenges as one reason for the chaos.

We talked to experts about the situation and what travelers should consider when planning trips, especially to busy places that might be hardest hit by the worker shortage.  

Book early — and check opening times

Caroline Beteta, CEO of Visit California, says, “Businesses here and across the country, especially in the hospitality industry, are feeling the effects of a shortage of employees as demand for travel ramps up. As the industry gets back to work, it’s more important than ever for travelers to book far in advance.”

During a midday check-in at Napa’s Embassy Suites hotel in the heart of California’s wine country on a recent trip, the desk clerk suggests making dinner reservations “like, right this minute, if you’re thinking of going anywhere in town for dinner. Normally you wouldn’t have to, but everyone’s short-staffed, so it’s tough to get a seat.” Circe Sher, the owner of Hotel Healdsburg in neighboring Sonoma County, says, “Many wineries who made the switch from walk-in to reservations only stayed that way due to staffing shortages. I suggest checking the days and times restaurants are open. If you are returning to a place, the restaurant you remember being open seven days a week may only be open five to accommodate reduced staff.”

That’s true across the country, including on Cape Cod in Massachusetts: The Mews Restaurant in Provincetown is one of many in this tourist town closed on Mondays and Tuesdays, even at the height of the season this past summer. Others, such as Barnstable Tuscan Cuisine, have eliminated the lunch service. Steve Tait, co-owner of Aerie House, a seven-room B&B, said one issue has been that the resort area’s summer worker population is usually boosted by young people who come from Europe on J-1 student visas, mostly unavailable this year due to COVID-19 restrictions. For Aerie House, that’s meant eliminating daily housekeeping services. “It’s been pretty rough,” Tait says. 

Expect to pay more

Michael Jacobson, president of the Illinois Hotel and Lodging Association, told local CBS news, “We are still facing staffing challenges both in the frontline, hourly positions as well as management. It has resulted in some hotels reporting they have to limit room sales because they do not have enough staff to accommodate 100 percent occupancy.”

With hotels booked, many travelers are turning to Airbnb and other short-term rentals — but increased demand is driving higher prices there as well. Vered Schwarz, chief operating officer of property management platform Guesty, says, “This Christmas is to be the most expensive holiday this year in the U.S. Travelers are currently booking at prices 53 percent higher than 2020 and 80 percent higher than pre-COVID 2019. Reservation volume across the U.S. is up 469 percent compared to 2020, and even 157 percent higher than 2019.”

The opening of U.S. borders to foreign tourists, expected to begin in early November, is not going to make things better for American travelers. Joshua Bush, CEO of AvenueTwo Travel agency, says, “While the news of the U.S. easing entry restrictions is great for the economy and overall travel industry, it does have a downside. With hotels running at limited capacity, this may shut out Americans who have not planned ahead. For the upcoming holiday season, my worry is that some Americans wanting to go to warm U.S. destinations may be left out in the cold.” 

Be Flexible

California’s Beteta suggests looking at alternative destinations or timing: “Seasonal demand is an important factor for staffing shortages. Consider traveling during a destination’s shoulder or off-season when regions are less congested.” Booking a ski resort town in fall, for example, or a cool-weather coastal trip in winter will help with pricing and availability, she notes.

Be patient and kind

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Restaurant Revitalization Fund, grant money could be on the way for small businesses - Shield Insurance Agency Blogmoney could be on the way for small businesses

Restaurant Revitalization Fund, grant money could be on the way for small businesses

By Andy Medici | The Playbook

This article first appeared in The Business Journals.

Small businesses could see more Restaurant Revitalization Fund money and other grants for hard-hit industries — but only after Congress finishes its work on a pair of infrastructure bills.

Right now, Congress is occupied trying to pass both a $1 trillion “hard infrastructure” bill with funding for roads and bridges, as well as another $3.5 trillion bill including tax credits for families with children through a process called reconciliation allowing just 50 votes in the Senate. That political wrangling is happening both between Democrats and Republicans and within the Democratic Party itself over how big the bill should be and how it should be passed.

There is also a separate, but the related issue over raising the so-called “debt ceiling,” which is essentially a separate vote by Congress to continue paying for spending it has already approved — and for which there is currently no Republican support in the Senate.

But once those thorny issues are dealt with, Congress will turn at least part of its attention to another stimulus bill focused on hard-hit industries, according to one source familiar with the deliberations. That includes a goal of having legislation before the end of the year. An initial draft is already in the works.

The legislation is currently being worked on between lawmakers on the various small business committees in the House and the Senate, in coordination with House Speaker Nancy Pelosi, D-Calif., and Chuck Schumer, D-N.Y., according to the source, with the potential for bipartisan support.

“Republican leadership is open to further aid for the hardest-hit industries that weren’t addressed by previous aid moving on a bipartisan package, though they would prefer the aid package be paid for when it moves,” the source said.

To be sure, plans can change and legislation can fall by the wayside. Even the current infrastructure bills were expected to be completed much earlier this year. But so far, this potential stimulus legislation is likely to include more funding for the Restaurant Revitalization Fund, as well as for gyms and others, according to the source.

Brian Doyle, spokesperson for Rep. Dean Phillips, D-Minn., said the lawmaker was advocating strongly for a small business relief package for industries harmed by the Delta variant, such as restaurants, gyms, and the live events industry.

His office put out a press release in late September stating Phillips had secured a promise from Pelosi to create a small business relief package in the House. The exchange was reported in The Hill as part of Pelosi’s efforts to secure votes for the reconciliation legislation.

“We can’t allow our nation’s Main Street business and community gathering places to suffer when we have both the tools and the resources necessary to keep them afloat. Too many lives and livelihoods depend on the strength of our small businesses. I look forward to working with my colleagues from both sides of the aisle to craft a relief package that meets the challenges of this moment.”

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10 areas businesses should address to mitigate professional lines risks in an evolving world - Shield Insurance Agency Blog

10 areas businesses should address to mitigate professional lines risks in an evolving world

From cybersecurity exposures and ransomware attacks to M&A volatility and securities litigation, a variety of evolving professional lines risks are affecting the management and professional liability market as the economy adapts in response to COVID-19.

The Professional Lines Risk Matrix featuring 10 potential exposures affecting the professional lines market.

The Risk Matrix, produced by the editorial team at Risk & Insurance®, plots 10 areas that businesses should address to mitigate professional lines-related risks, based on frequency and severity.

10 areas businesses should address to mitigate professional lines risks in an evolving world - Shield Insurance Agency Blog

Download the Risk Matrix

Higher M&A volatility

One pandemic-era risk trend that continues to affect markets is the rise of mergers and acquisitions (M&A). Morgan Stanley reported that last quarter saw 1,250 M&A deals globally, totaling more than $1 trillion. Contributing to the economic landscape are special purpose acquisition companies (SPACs), businesses expressly created to take other companies public and avoid the traditional IPO process. With SPACs, there can be a conflict of interest, with one party trying to close the deal quickly and the other party focused on price. This conflict is leading to more litigation under federal security laws.

Cyber and the board

In 2021 so far, 68.5 percent of businesses have already been victimized by ransomware, according to Statista. And with more than 300,000 new pieces of malware created daily, now is the time for boards of directors to address cyber risk needs. And for good reason: cyber risks are about more than private data; they imperil core operational functions and strategic objectives. It’s never too early to get the board invested in cyber risk management.

D&O risks for extreme weather

Severe weather events can push systems to their limit. When those systems fail, businesses and municipalities may be liable for claims relating to property damage, business interruption, and even loss of life. Directors and officers could be held liable if they fail to prepare for severe weather, much like we saw when historic Winter Storm Uri left portions of Texas without heat or power for a week.  Government and municipalities can mitigate potential directors and officers’ (D&O) exposures by conducting their due diligence. Taking actions like staying up to date on climate data, evaluating and upgrading their current capacities against system failure, and having a continuity plan for emergencies can help organizations reduce their risk and keep the public safe.

Ransomware

The threat of ransomware attacks is becoming more common—in 2021 so far, 68.5 percent of businesses have already been victimized by some type of attack. Digital connectivity is unavoidable for businesses as more turn to computers and online systems to get the job done. The inability to protect sensitive data could leave organizations in both legal and financial jeopardy and goes beyond just cyber exposure. For example, when a ransomware attack occurs at a healthcare facility, both patients and hospital operations can be impacted, resulting in medical malpractice, product liability, and billing errors, and other regulatory liability concerns.

Proper due diligence

For more than a year, businesses across sectors pivoted to new functions and capabilities to keep up with the rapidly evolving economic landscape. While many pandemic-related restrictions are being lifted, the post-COVID-19 world poses a new set of risks that organizations will need to address. Whether companies are welcoming employees back to the office, entering into new vendor partnerships, or evaluating their geographic footprints, they need to do their due diligence and assess the potential exposures.

Social responsibility

Businesses are committing to environmental and social governance (ESG) more than ever before because consumers are looking to engage with corporations that take into account their impact on society at large. How a company treats its employees, addresses top-tier societal issues, and responds to current events can have a significant effect on overall performance. But if a company fails to follow through on its promises, it can expose itself to a variety of risks—loss of shareholders, employees, reputation and revenue can stem from poor ESG performance.

Bankruptcy-related claims

With 2020 going down in history as the “year of COVID-19,” D&O inquiries and related claims continue to be at the forefront of many organizations’ minds. Pandemic-driven macro-economic conditions have disrupted revenue and cash flow, resulting in debt covenant triggers and bankruptcy filings. Boards should be prepared for potential litigation arising out of such actions, and claims made against management alleging misconduct and/or negligence in the performance of fiduciary duties are predicted to rise.

Audits of PPP loans

In response to economic instability caused by the COVID-19 pandemic, Congress passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act. A key part of that act was the Paycheck Protection Program, or PPP, a low-interest loan backed by the Small Business Association (SBA) that would help businesses cover payroll and other operational expenses. As of May 31, 2021, the SBA has given out more than $800 billion in PPP loans. And while most PPP recipients used their loans to stay afloat and support their workforce, some business owners used that money inappropriately. Now, the Department of Justice (DOJ) is beginning to look more closely at how these funds were being used. A business under investigation may look to its D&O insurance policy for support—but it doesn’t necessarily provide coverage in fraud-related government investigations.

Insurance ramifications from layoffs

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4 risk-management challenges of using cross-laminated timber in construction - Shield Insurance Agency Blog

4 risk-management challenges of using cross-laminated timber in construction

In the last few years, a surprisingly conventional material has swept the sustainable building industry: wood. Cross-laminated timber (CLT) construction, a building method in which wood is layered to create a strong and durable frame, is now competing with traditional concrete and steel foundations. This method, which has become increasingly popular in Europe, is now making headway in the United States. According to the Globe News Wire, the industry is projected to grow by 12 percent between 2021 and 2027.

Construction companies, architects, and environmental advocates alike are embracing CLT because it’s more sustainable than traditional materials, durable, lightweight, and suitable for prefabricated construction projects. But this building method also poses new risk-management challenges for owners, builders, and insurance providers. In this article, we’re examining the challenges of CLT across multiple insurance lines—and sharing suggestions for contractors to help mitigate potential risk.

Challenge 1: protecting the project during construction

In terms of builders’ risk coverage, CLT has some benefits. Because it can be built off-site and transported, the method can result in shortened building cycles, which means contractors may save money on insurance costs. However, builders will need coverage in the event of fire or water damage. CLT is made entirely of wood and—even though the material has been proven to burn slowly in fire tests—it is at a higher risk of fire damage than more traditional materials. On top of that, staining and charring of the wood from water and fire damage can cause aesthetic issues, and project owners might require builders to replace the panels even if the building is still structurally sound.

How to mitigate risk: contractors should ensure that CLT is pre-treated with a fire retardant before building. It’s also crucial that all members of the building team understand transport, storage, and staging best practices to limit exposure to the elements.

Challenge 2: evaluating environmental risks

When it comes to environmental risks, CLT has a leg up over traditional building materials. Although CLT is bonded with glue, most manufacturers use formaldehyde-free adhesives to improve air quality and reduce off-gassing. However, when building with CLT, construction companies should take notice of potential water damage and subsequent mold exposure risks. The 2021 International Building Code allows for CLT buildings up to 18 stories—but these taller buildings are exposed to the elements for more extended periods during construction, increasing the risk of water damage and mold growth. If property owners discover mold, contractors may be liable for any damages or associated health risks.

How to mitigate risk: builders should treat CLT with water repellents, particularly on the end-grain where the wood is more porous. During construction, using tent structures that cover exposed materials can also reduce the risk of water damage that can lead to mold growth.

Challenge 3: understanding cross-laminated timber performance capabilities

Because CLT is a newer material for many builders, design-build contractors should take special care to ensure their designs are structurally sound and materials meet quality standards. Both designers and builders should reference and comply with the applicable International Building Codes and stay up to date on evolving research. For example, as this study highlights, the shape and number of layers of CLT can influence the risk of delamination, in which the adhesive holding boards together fails and can put a structure at risk.

As an example of delamination, work came to a halt on a $79-million building under construction at Oregon State University after two layers of CLT floor panel came unglued and fell. While the incident did not cause any injuries, it did result in a several-month-long investigation, extensive rework to replace the damaged panels, and a delayed opening.

By staying informed on CLT performance capabilities, designers and builders are better able to build safely and on schedule and help mitigate the risk of damage, work delays, and related builders’ risk and liability claims.

How to mitigate risk: designers and builders should ensure that building codes align with the use of cross-laminated timber. Using building information modeling (BIM) during the planning process can also help ensure that all stakeholders—including owners, designers, engineers, and architects—are on the same page during the project. 

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Why You Can't Shake Pandemic Fatigue — And What To Do About It - Shield Insurance Agency Blog

Why You Can’t Shake Pandemic Fatigue — And What To Do About It

Pandemic Fatigue: How to know if (still) feeling tired is a phase, a funk or something worse

by Beth Howard, AARP, August 10, 2021

Feeling fatigued during what seems like a never-ending pandemic? Join the club. Whether you feel like you’re languishing or just lacking the energy to head back to the office this fall, you may be one of many Americans who can’t quite shake pandemic-related malaise.

“We’re at home and we’re stressed and the impact of that is to develop a sort of mental and emotional lethargy,” says Margaret Wehrenberg, a clinical psychologist in Saint Charles, Missouri, and author of Pandemic Anxiety: Fear, Stress, and Loss in Traumatic Times.

And yes, your pandemic habits can also play a role — especially if things like regular exercise or healthy eating went out the window sometime during the lockdown. “A lot of people who thought it was going to be a six- or 12-week thing let their diet go,” says Kathryn A. Boling, M.D., a primary care physician at Mercy Medical Center’s Mercy Personal Physicians in Lutherville, Maryland. And instead of, say, going to work and hustling through a commute, “we just walk from the bedroom to the living room and sit in a chair most of the day, except for when we get up to snack.” A year of such habits has likely contributed to the general lassitude. But if you’re over 50 and worried that feeling worn out may just be your new normal, know this: Being tired is not a typical aspect of aging. At least it shouldn’t be when you’re in your 50s, 60s, or 70s. “It does not have to be part of aging until you get pretty advanced,” Boling says. “If you’re 90, you’re more likely to run out of gas.”

When ‘tired’ means depressed

Of course, fatigue can also result from many underlying physical and mental health issues, such as depression. Low energy and tiredness are indeed key features of this common mood disorder.

“One of the ways to tell if you’re fatigued from depression, or not, is asking yourself if you feel motivated,” Boling says. “If the fatigue is more like, ‘I don’t care. I don’t want to do anything. I don’t want to get up,’ or are you really wanting to do things, but you just feel physically tired?” If it’s “de-motivated” fatigue or you’re feeling a sense of hopelessness along with the fatigue, she says, then you may be depressed.

“Traditionally we say depression is when people have what’s called anhedonia, where the things that they used to do that gave them pleasure no longer give them pleasure,” adds George Abraham, M.D., president of the American College of Physicians. If that’s the case, it’s wise to see a doctor and weigh the options for treatment.

What else it could be — including, yes, your thyroid

Fatigue also frequently occurs with thyroid disorders, anemia, vitamin B12 deficiency (particularly in vegetarians), obstructive sleep apnea, and as a result of hormonal imbalances, such as low testosterone in men, Abraham says. What’s more, tiredness can linger for several weeks after any viral illness, including influenza, colds, and COVID-19 itself.

When should you worry? “A good rule of thumb is the persistence of symptoms,” Abraham says. If you’re still having issues after a month or so, your doctor will want to examine you and run some tests.

Exhaustion accompanied by shortness of breath, sudden bruising, or sudden coughing can signal a more urgent concern, such as heart disease or cancer, says Suzanne E. Salamon, M.D., a geriatrician at Beth Israel Deaconess Medical Center in Boston. For example, “If someone is coughing excessively, then I would want to be sure it’s not pneumonia, or if they were a past smoker to make sure that there’s no evidence of cancer,” she says.

“Many times women don’t have the same symptoms for heart attacks as men have,” adds Boling. “They don’t necessarily have acute chest pain. Sometimes they only have overwhelming fatigue.” In cases like these, seek immediate help.

Pandemic Fatigue fixes to start today

The obvious solutions: Stay away from processed foods, eat more vegetables, fruits, and whole grains, and get some exercise, even if it’s just a walk around the neighborhood. Sleep issues can of course similarly sap daytime energy, whether they’re pandemic-related or from shifting hormones, particularly in women going through menopause. Unfortunately, Boling says, people don’t often do what they need to prepare for a restful night, such as turning off electronic devices, covering up light sources, and keeping TVs out of the bedroom.

It’s worth trying these strategies and establishing a regular sleep routine, including time to wind down without stimulation before bed. FYI: A Northwestern University study found that “pink” noise (available on many sound machines and sleep apps) increased deep sleep in older adults.

If none of these work, give melatonin a try, Salamon advises. “I generally suggest starting with 1 milligram and taking it about an hour before bedtime to see if that helps,” she says. Patients can gradually increase the dose if they need to until they find their sweet spot.

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4 ways telematics can drive safety for construction companies - Shield Insurance Agency Blog

4 ways telematics can drive safety for construction companies

In recent years, many construction companies have realized the value of telematics, a method of using phone apps, seatbelt monitors, AI sensors, and cameras to capture information on driving behavior and safety. But while implementing telematics has become increasingly common in construction vehicles, studies show that most companies aren’t embracing the technology to its full potential.

A recent survey showed that while 86 percent of construction companies use telematics, only about 23 percent use that data to inform their decision-making.

The value of telematics data goes beyond safety. It can also offer insight into company-wide trends, reduce operating expenses, and even help in court. Here are four ways that implementing telematics can add value to your construction company—and tips to help construction risk managers and executives act on the data these systems collect.

1. Create a culture of safety for construction companies.

Construction workers face one of the highest rates of injury and death on the job of any profession. The industry accounted for about 20 percent of all on-the-job fatalities in 2019, according to OSHA. As such, creating a culture of safety is a high priority for construction executives, who want to mitigate risk and keep employees safe.

Telematics data enables companies to create that culture of safety—but simply implementing telematics won’t make drivers safer. To make real change, companies need to monitor and coach drivers, with the goal of improving driving behavior and reducing risk.

By leveraging data to change drivers’ habits, companies can take a proactive approach to safety and help stop accidents from happening in the first place. 

Tips for implementation: coach drivers more effectively and respond to trends, not single incident, so employees don’t feel like they are being punished for a situation that may not have been in their control. Focus on positive reinforcement and get to the root cause of poor driving behaviors—like determining whether employees are overworked or fatigued. Liberty Mutual’s Managing Vital Driving Performance (MVDP™) program takes this approach to help companies implement telematics successfully. One customer realized a 56 percent decrease in aggressive driving events and a 60 percent decrease in hard braking events over a three-month time period after implementing MVDP.

2. Reduce operating expenses.

As noted above, telematics data can help your company move from a reactive to a proactive approach to driver safety—and that can make a difference for your bottom line. Why? Safer driving will lead to fewer accidents and less money spent on vehicle repair and replacement. Over time, safe driving can even cut down on regular maintenance costs because drivers won’t wear out brakes and other parts as frequently. Additional savings might include improved fuel efficiency and better regulatory compliance—which means lower fuel costs and fewer DOT citations to pay.

Tips for implementation: bring telematics into your asset-management process by monitoring costs like maintenance, citations, and other expenses each quarter. You can then compare these expenses to telematics data to track how safe driving is impacting your operating costs.

For larger companies, in particular, telematics is a valuable investment as it can help you spot trends across your fleet. A national construction company, for example, might use telematics to monitor driving behavior across geographic regions to determine whether certain areas are more prone to risk. Telematics data can also help you track trends across different employee populations, types of vehicles, and more. These trends can help you assess your risks from all aggressive driving—not just aggressive driving that has resulted in a single accident.

Tips for implementation: for companies with a large fleet, telematics data analysis should be part of a robust fleet safety program that includes pre-hiring screenings, crash reporting protocols, and more. 

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PFAS the extraordinarily costly liability you need to know about - Shield Insurance Agency Blog

PFAS: the extraordinarily costly liability you need to know about

A new and massively costly complication is changing environmental liability: cleanup of hazardous per- and polyfluoroalkyl substances (PFAS) found in aqueous film-forming foams or AFFFs. Commonly used throughout the United States, these Class B firefighting foams are used to extinguish fires involving flammable and combustible liquids, oils, gases, and more. PFAS are held to some of the toughest cleanup standards among regulated contaminants. To make matters more challenging, there are few technologies proven to do the job – and many associated costs.

Cleanup costs of PFAS compounds in AFFF can be 5 to 20 times more than those of fuels released from a petroleum storage facility.1

What creates such high costs?

PFAS waste is managed by waste disposal companies as federal hazardous waste. Disposal costs are often nearly double the typical cost of disposal of petroleum-impacted waste. There are several factors at work here:

  • Limited soil treatment options. The only proven methods for treating PFAS in soil are excavation followed by landfill disposal or destruction via incinerator – both of which are costlier than methods used to dispose of other contaminants. 
  • Limited soil treatment resources. Because of the potential for extraordinary liability, only a limited number of landfills and incinerators accept PFAS waste.
  • High transport costs. With facilities few and far between, transporting PFAS-impacted soil can be four times higher than transporting petroleum-impacted waste.1
  • Limited groundwater treatment options. Only ex-situ technologies that include groundwater extraction wells and above-groundwater treatment systems with granular activated carbon or ion exchange resins are proven to treat PFAS in groundwater.
  • Long-term groundwater costs. A groundwater extraction and treatment system may need to operate for as long as 40 years, entailing significant operation and maintenance costs. 
  • Strict federal standards. The acceptable rate of PFAS is notably low, requiring a greater effort and more funds to achieve.

Breaking down cleanup costs

This outline of cleanup costs associated with PFAS contamination following a typical energy industry fuel fire shows the considerable scope of this threat.

$2.25M
Collection and disposal of 1M gallons of AFFF, water, and fuel at hazardous waste management facility

$12M to $54M
The projected cost for soil cleanup

$10M to $15M
The projected cost for groundwater cleanup

$1.8M
One year of stormwater runoff management (collection, transport, and disposal of 800,000 gallons of runoff at hazardous waste management facility)

TOTAL COSTS
$26.05M to $73.05M

How can vulnerable companies prepare?

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