Welcome to the most worrisome and troubling claims known to the insurance industry. We’ll explore the nightmares, business breakers and most tragic claims to hit snow businesses. Come on a journey into the dark work of insurance claims where death is only the beginning, and the damages know no limits!

Death claims

It’s an unfortunate reality that deaths can occur during winter operations. Some examples:

• It’s late after a long shift. You arrive at a new location and the parking lot isn’t completely empty as a neighboring restaurant is still open despite the conditions. You start to back up from your initial run and your sensors go off. You hit the brakes to avoid a pending collision—false alarm as you look in your mirrors and see nothing. It happens again and again as you continue to plow the lot, but this time you notice something on the cleared pavement. You get out in a panic and miss the last step, slip on the snow and slush, reel back and hit your vehicle.
• A team member is driving to a jobsite and sees a runner along the paved street instead of the snow covered sidewalk or pathway. It is too late to course correct, and the driver clips the individual with the plow wing.
• The most common claim leading to death or dismemberment is still cleaning out salt augers. NEVER let anyone reach in, stand in, or attempt to remove clumps!

Now for the good news. Insurance is available to cover these scenarios and lessen the impact on your business and operations in the event they occur.

General liability. Bodily injury and property damages are covered under general liability and extend to snow removal operations with the right endorsements on your master policy. This covers all third parties and can even extend into worker’s compensation and liability if the accident occurs in certain states. This would also apply to any property damage and slip and falls that would lead to a future injury or future peril if linked directly to the accident.

Worker’s compensation. This insurance covers the medical, lost wages, disability and death to any employees and elected officers within the covered territory. Some states also require third-party damages that pay out to the family and remaining kin for additional damages that they would not have otherwise endured had the accident not happened.

Key man insurance. These are standard life insurance policies that pay the business back for the loss of an owner, officer or critical employee as long as the policy is taken out while the person is employed or involved in the operations. These are most common in LLCs and corporations as it allows for partners, owners and officers to buy out spouses and beneficiaries at the time of death funded by a policy and not out of their own pockets. These most commonly pay out at time of death, but some riders and endorsements have added back coverage for long-term disability, chronic or mental conditions, diseases, and others.

Check with your agent about these options and have a deeper discussion to better understand how your business is covered in the event of a death.

Disasters

We build our businesses around process in order to control the controllable, and then insure the uncontrollable such as a flood, fire, earthquake, power outage or a gas leak. Armed with planning, hard work, undying spirit to succeed and a good insurance partner, many businesses can withstand most problems thrown at them…but one slip-up or uncovered peril could be its undoing.

The best takeaway from natural and manmade disasters would be to keep a reserve fund for the unexpected and always be ready to adapt to changing conditions and prep for a mobile business or remote operations. This disaster plan will help you to be among the top performers within the industry and help create a culture ready to take on challenges.

Damages

This is a hard category to define since it includes anything from bumpers, light poles, signs and fences to equipment, salt domes, buildings, and any other fixed assets. It also extends to unfixed assets like people and body parts, pets, future wages, rental revenues, emotional loss, lost time or disabilities and loss of use. We most commonly see damages as a result of the following:

Vehicles and equipment. Operating during snowy and harsh conditions makes it difficult to see. No matter how much technology and assistance we give our personnel, accidents still happen. Training, route familiarity and safety incentives are critical for reducing accidents.

Completed operations. This category includes slip and fall claims and claims reports. Anything that you have serviced or results from your servicing a contract falls under the General Liability "Completed Operations" category. This has also been amended to include all property damage and bodily injuries reported through contracted means.

Cyber crime. Ransomware, cyber theft, and cyber crime are no different than damages to property or owned assets. Many courts have ruled that intellectual property (IP) is to be treated as property; thus claims and damages to a computer or while using a computer are mostly paid out under a cyber policy.

Property coverage. Damages to buildings, temporary structures, owned property, inventory, and anything you can prove ownership of would all fall under this policy. Some property forms will require prior agent knowledge or prior notice to your insurance company before coverage can be granted. Ask your agent about "Blanket Property Coverage" and how you can combine assets and buildings into shared allocations. This reduces the number of surprises you may have to deal with. Secondly, with the rise in construction costs, it should be standard practice to have your structures appraised by a Reconstruction Cost Estimator to ensure that your largest assets are properly insured to value and further reduce your surprise when a disaster, total loss, or even a partial loss claim comes knocking.

It is always best to talk to a licensed insurance agent or broker about your annual coverages and how to best protect them. Value, coverage forms and partnerships—not pricing—should be the goal in any insurance situation. Buying the lowest or cheapest will only further ensure that you will be in peril when claims find you and could force future increases to be drastic… if your business survives the initial setback.

Jack Demski is a licensed commercial insurance advisor with Ansay & Associates, specializing in risk management for snow and land contracting. Contact him at Jack.Demski@ansay.com or 414.491.5918.