I have read a lot of biographies, self-development and business books over the years and just wanted to put down a few things I have learned and share a little bit about myself. It may not be worth much to you but it is a good way of reminding me of the things I should be doing to build a profitable book of business and create valuable relationships along the way. Also, hopefully by getting to know me a little bit we can find more common ground and it will give me an opportunity to know you better as well. I dont want to be seen as some insurance freak that reads policies all day :) Please feel free to comment and add your business insights and philosophies and share your interests also!
1) "Never Eat Alone" This is a book I read by Keith Ferazzi about building your network. This has been a hard thing for me to do but one way I have been able to use it is by trying to attend a lunch group at least once a week. For me, these groups include Exchange Club, WSU roundball, Rotary, local business presentations, etc. I find that I am able to spend about an hour of quality time with people who have some of my same interests and who are generally eager to stay in contact and help each other in our business endeavors.
2) Never burn bridges. This can be difficult when you get to the end of a conversation with a long-term client who is ending the relationship because they found a better price or some other reason. My theory has been and always will be that I should respect my clients decisions and try my best to continue our relationship whether I get their business or not. For me, it isnt about business so much as it is about people. Nevertheless, I know that a clients business has to be earned each and every year and am committed to doing everything in my power to keep my clients and provide the best price and service possible. Sometimes when you lose a client it is only a matter of time before they come back seeking your help. If you act bitter and upset about their decision then chances are they won't ever be coming back.
3) Apply your knowledge. Many of us spend countless hours studying our trade and trying to become experts in our industry but when it comes down to finding new business we end up doing as little as possible to close the deal. What happens when we apply our knowledge and spend adequate time analyzing and making recommendations for our prospects? We win. The amount of effort you put into a proposal will clearly show during the presentation. Rather than getting the specs and quoting, we need to spend more time analyzing, making recommendations, asking questions, negotiating, and understanding the agreements if we are to truly bring value to our clientele.
4) "The Golden Rule". We all know what it is, but do we apply it in our business transactions? Do we value relationships, service, expertise, and credibility instead of focusing only on the price? I find it difficult when I am buying a new car or a house or negotiating my cable bill to try to suck every dollar I possibly can out of my provider. I understand that they need to make a profit also and I seek a fair price based on the options available to me. I hope that my clients accept this principle as well because I cant always guarantee that there isnt some unknown or overlooked insurance company that will pop up out of nowhere and beat my price. I normally make suggestions to my clients after reviewing a number of viable and competitive options and it may not always be the one with the lowest price.
5) Hard Work. There really is no substitute for putting in the hours, making the phone calls, meticulously reviewing proposals and quotes, responding to emails, making yourself available, seeking others opinions, understanding the marketplace, providing excellent service, going the extra mile, and giving your all. Day in and day out there are no excuses. This is what it takes to be successful in any economy. I am a firm believer that the harder I work the luckier I get. It always takes a little luck but that luck is usually a direct product of doing everything in my power to make it happen.
6) Have Fun. For me, work is fun for the most part but it cannot fill this need. I have decided that I need to take a break every once in a while to go on vacation, spend time with my family, or take an occasional day off so I can be my best self when I am in the office. I like to know what my clients do for fun so we have things to talk about besides insurance when we get together. I find that it is generally pretty easy to find common interests with people and it makes working with them much more enjoyable knowing that they are real people and not 100% business all the time.
Here are a few of my interests you may not be aware of. If you have some of these same interests, let's talk about it the next time we get together!
I am an avid exerciser, I played golf in high school, I served a church mission for 2 years in El Salvador, I lived in Puerto Rico for 5 months selling home security, I like to play/watch any sport, I am a snowboarder and a skiier, I love to boat in the summertime, I love to travel and have been fortunate to visit many states and other countries including: Mexico, Canada, Peru, UAE, and India. I like to hunt and fish. I like to read business books, american history, and biographies. I enjoy Utah and BYU athletics but at heart I am a Weber State Wildcat! Most of all I like spending time with my wife and my 10 nieces and nephews.
I am generally an open book. I like to be completely honest with my clients about who I am and what I can do for them. I do not use shady sales tactics and I would never hesitate to answer a client's phone call. I don't always have every answer immediately but I can always find the answer. I dont overpromise or always say what you want to hear but I can back up my words every time.
Monday, November 29, 2010
Thursday, November 18, 2010
IMPROVE YOUR INSURABILITY!
One of the things I try to do for each of my clients is to build a positive insurance profile and summary before submitting the account to an Underwriter. Underwriters LOVE information. They like to see details, descriptions, brochures, contracts, updates, etc. Most importantly, they like to see an ongoing Risk Management program. This shows the insurance company that the owner is doing everything in their power to prevent claims. These are the companies that get the credits and have access to more insurance carriers.
Often times, insurance carriers will offer quotes in certain industries based on their definition of “Best in Class.” For example, they may not typically write a Waste Hauler but if they receive a detailed submission showing the things they want to see, then they will likely consider offering a very competitive quote. Why? Because the truth is that most businesses purchase insurance in lieu of implementing proper risk management. The ones that do implement a quality risk management program will reap insurance rewards. Many insurance companies will request an inspection by an outside agency or send their own before deciding whether to provide a quote on something. So, what are they looking for?
Things to make a building look better to an insurance company include:
• Hard-wired smoke detectors
• Proper handrails and fire escapes
• Child-safe window hardware
• Sidewalks free of major cracks
• Closed fire doors with proper panic hardware
• Well-lit hallways and walkways
• Following regulations for elevators and laundry rooms
• Control of all maintenance issues: Practice good maintenance–no wet floors
• Do routine repairs
• Mold eradication
Make sure your risk profile includes all safety-related improvements in the property such as any alarm systems, security cameras, addition of a doorman, improved lighting, and anything else that makes your building more appealing to an insurance underwriter who can then apply credits for the safety measures taken.
Advise your insurance broker of upgrades and repairs to your building. Upgrades to major systems such as heating, electric, and plumbing greatly improve your risk profile and can present your property better to the insurance company. This may lead to better pricing and broader terms when the insurance companies offer you quotes. Insurance companies show their appreciation to those risks that have improved profiles and ongoing risk management by offering them lower rates and policies with broader terms.
Similar risk management principles apply to Auto Insurance, Workers Compensation, and General Liability. Continued maintenance, proper safety restraints and trainings, quality PR and documentation, etc. will greatly improve your insurability.
Tuesday, November 16, 2010
WHY DO I NEED EMPLOYEE DISHONESTY COVERAGE??
WHAT IS IT?
This insurance protects the employer from financial loss due to the fraudulent activities of an employee or group of employees. The loss can be the result of the employee’s theft of money, securities or other property of the employer.
WHY DO I NEED IT?
Fraud and embezzlement in the workplace is on the rise. The Association of Certified Fraud Examiners (ACFE) estimates business losses $400 billion per year or about 6% of total annual revenue. Small companies can be especially effected by theft and embezzlement because they can’t afford extensive safeguards and aren’t large enough to absorb losses. Workplace crime is carried out by employees 80% of the time. One in four employees who has committed fraud against their employer had been with the company more than ten years.
WHAT DOES IT COVER?
This insurance protects the employer from financial loss due to the fraudulent activities of an employee or group of employees. The loss can be the result of the employee’s theft of money, securities or other property of the employer.
WHY DO I NEED IT?
Fraud and embezzlement in the workplace is on the rise. The Association of Certified Fraud Examiners (ACFE) estimates business losses $400 billion per year or about 6% of total annual revenue. Small companies can be especially effected by theft and embezzlement because they can’t afford extensive safeguards and aren’t large enough to absorb losses. Workplace crime is carried out by employees 80% of the time. One in four employees who has committed fraud against their employer had been with the company more than ten years.
WHAT DOES IT COVER?
Stand alone policies are designed to cover employee thefts, robbery and safe burglaries. Coverage can also include:
1. Forgery or alteration
2. Funds transfer fraud
3. Computer fraud
4. Credit card fraud
5. Money order and counterfeit fraud
On a personal note, My brother in law owns a small business which in many instances requires that you hire one person who you trust to undertake a broad range of responsibilities. In his case, he hired someone who was in charge of paying bills, balancing books, depositing checks, etc. After being employed for several years with his company, they found out that this employee had been stealing money and making unauthorized charges on company credit cards then covering them up with other expenses. This can be a huge devastation for a small business that lives by cash-flow.
In another example, a local trucking company recently found out that their controller has been embezzling money from them for a number of years to the sum of about $1.3 million.
Many times the people who are found stealing money from their employer are people who feel they are very trusted and might feel entitled to more money or benefits. The worst thing an employer could do is assume that they have great employees who would never do anything to harm the company. Employee Dishonesty insurance can help protect you against these financial losses. If you questions about this or would like to discuss ways to ensure proper limits and coverage please contact me!
Sunday, November 7, 2010
phil heath Kai Greene Branch Warren after the 2009 Mr Olympia video phil heath met rx
phil heath
video of phil heath Kai Greene and Branch Warren after the 2009 Mr Olympia, phil heath was unlucky at the 2009 mr olympia due to some illness going into the mr olympia bodybuilding contest.
but aspect to see phil heath pushing for the 2010 mr olympia title and in much better condition then the 2009 mr olympia contest.
phil heath is wearing a met rx t-shirt in the video not sure if phil heath is still sponsored by met rx or not now.
Malocclusion: Disease of Civilization, Part IX
A Summary
For those who didn't want to wade through the entire nerd safari, I offer a simple summary.
Our ancestors had straight teeth, and their wisdom teeth came in without any problem. The same continues to be true of a few non-industrial cultures today, but it's becoming rare. Wild animals also rarely suffer from orthodontic problems.
Today, the majority of people in the US and other affluent nations have some type of malocclusion, whether it's crooked teeth, overbite, open bite or a number of other possibilities.
There are three main factors that I believe contribute to malocclusion in modern societies:
In one, he made more space in her jaws by extracting teeth. In the other, he put in an apparatus that broadened her dental arch, which roughly mimics the natural process of arch growth during childhood and adolescence. This had profound effects on the girls' subsequent occlusion and facial structure:
The girl on the left had teeth extracted, while the girl on the right had her arch broadened. Under ideal circumstances, this is what should happen naturally during development. Notice any differences?
Thanks to the Weston A Price foundation's recent newsletter for the study reference.
For those who didn't want to wade through the entire nerd safari, I offer a simple summary.
Our ancestors had straight teeth, and their wisdom teeth came in without any problem. The same continues to be true of a few non-industrial cultures today, but it's becoming rare. Wild animals also rarely suffer from orthodontic problems.
Today, the majority of people in the US and other affluent nations have some type of malocclusion, whether it's crooked teeth, overbite, open bite or a number of other possibilities.
There are three main factors that I believe contribute to malocclusion in modern societies:
- Maternal nutrition during the first trimester of pregnancy. Vitamin K2, found in organs, pastured dairy and eggs, is particularly important. We may also make small amounts from the K1 found in green vegetables.
- Sucking habits from birth to age four. Breast feeding protects against malocclusion. Bottle feeding, pacifiers and finger sucking probably increase the risk of malocclusion. Cup feeding and orthodontic pacifiers are probably acceptable alternatives.
- Food toughness. The jaws probably require stress from tough food to develop correctly. This can contribute to the widening of the dental arch until roughly age 17. Beef jerky, raw vegetables, raw fruit, tough cuts of meat and nuts are all good ways to exercise the jaws.
In one, he made more space in her jaws by extracting teeth. In the other, he put in an apparatus that broadened her dental arch, which roughly mimics the natural process of arch growth during childhood and adolescence. This had profound effects on the girls' subsequent occlusion and facial structure:
The girl on the left had teeth extracted, while the girl on the right had her arch broadened. Under ideal circumstances, this is what should happen naturally during development. Notice any differences?Thanks to the Weston A Price foundation's recent newsletter for the study reference.
Saturday, November 6, 2010
Magnesium and Insulin Sensitivity
From a paper based on US NHANES nutrition and health survey data (1):
Magnesium status is associated with insulin sensitivity (2, 3), and a low magnesium intake predicts the development of type II diabetes in most studies (4, 5) but not all (6). Magnesium supplements largely prevent diabetes in a rat model* (7). Interestingly, excess blood glucose and insulin themselves seem to reduce magnesium status, possibly creating a vicious cycle.
In a 1993 trial, a low-magnesium diet reduced insulin sensitivity in healthy volunteers by 25% in just four weeks (8). It also increased urinary thromboxane concentration, a potential concern for cardiovascular health**.
At least three trials have shown that magnesium supplementation increases insulin sensitivity in insulin-resistant diabetics and non-diabetics (9, 10, 11). In some cases, the results were remarkable. In type II diabetics, 16 weeks of magnesium supplementation improved fasting glucose, calculated insulin sensitivity and HbA1c*** (12). HbA1c dropped by 22 percent.
In insulin resistant volunteers with low blood magnesium, magnesium supplementation for four months reduced estimated insulin resistance by 43 percent and decreased fasting insulin by 32 percent (13). This suggests to me that magnesium deficiency was probably one of the main reasons they were insulin resistant in the first place. But the study had another very interesting finding: magnesium improved the subjects' blood lipid profile remarkably. Total cholesterol decreased, LDL decreased, HDL increased and triglycerides decreased by a whopping 39 percent. The same thing had been reported in the medical literature decades earlier when doctors used magnesium injections to treat heart disease, and also in animals treated with magnesium. Magnesium supplementation also suppresses atherosclerosis (thickening and hardening of the arteries) in animal models, a fact that I may discuss in more detail at some point (14, 15).
In the previous study, participants were given 2.5 g magnesium chloride (MgCl2) per day. That's a bit more than the USDA recommended daily allowance (MgCl2 is mostly chloride by weight), in addition to what they were already getting from their diet. Most of a person's magnesium is in their bones, so correcting a deficiency by eating a nutritious diet may take a while.
Speaking of nutritious diets, how does one get magnesium? Good sources include halibut, leafy greens, chocolate and nuts. Bone broths are also an excellent source of highly absorbable magnesium. Whole grains and beans are also fairly good sources, while refined grains lack most of the magnesium in the whole grain. Organic foods, particularly artisanally produced foods from a farmer's market, are richer in magnesium because they grow on better soil and often use older varieties that are more nutritious.
The problem with seeds such as grains, beans and nuts is that they also contain phytic acid which prevents the absorption of magnesium and other minerals (16). Healthy non-industrial societies that relied on grains took great care in their preparation: they soaked them, often fermented them, and also frequently removed a portion of the bran before cooking (17). These steps all served to reduce the level of phytic acid and other anti-nutrients. I've posted a method for effectively reducing the amount of phytic acid in brown rice (18). Beans should ideally be soaked for 24 hours before cooking, preferably in warm water.
Industrial agriculture has systematically depleted our soil of many minerals, due to high-yield crop varieties and the fact that synthetic fertilizers only replace a few minerals. The mineral content of foods in the US, including magnesium, has dropped sharply in the last 50 years. The reason we need to use fertilizers in the first place is that we've broken the natural nutrient cycle in which minerals always return to the soil in the same place they were removed. In 21st century America, minerals are removed from the soil, pass through our toilets, and end up in the landfill or in waste water. This will continue until we find an acceptable way to return human feces and urine to agricultural soil, as many cultures do to this day****.
I believe that an adequate magnesium intake is critical for proper insulin sensitivity and overall health.
* Zucker rats that lack leptin signaling
** Thromboxane A2 is an omega-6 derived eicosanoid that potently constricts blood vessels and promotes blood clotting. It's interesting that magnesium has such a strong effect on it. It indicates that fatty acid balance is not the only major influence on eicosanoid production.
*** Glycated hemoglobin. A measure of the average blood glucose level over the past few weeks.
**** Anyone interested in further reading on this should look up The Humanure Handbook
During 1999–2000, the diet of a large proportion of the U.S. population did not contain adequate magnesium... Furthermore, racial or ethnic differences in magnesium persist and may contribute to some health disparities.... Because magnesium intake is low among many people in the United States and inadequate magnesium status is associated with increased risk of acute and chronic conditions, an urgent need exists to perform a current survey to assess the physiologic status of magnesium in the U.S. population.Magnesium is an essential mineral that's slowly disappearing from the modern diet, as industrial agriculture and industrial food processing increasingly dominate our food choices. One of the many things it's necessary for in mammals is proper insulin sensitivity and glucose control. A loss of glucose control due to insulin resistance can eventually lead to diabetes and all its complications.
Magnesium status is associated with insulin sensitivity (2, 3), and a low magnesium intake predicts the development of type II diabetes in most studies (4, 5) but not all (6). Magnesium supplements largely prevent diabetes in a rat model* (7). Interestingly, excess blood glucose and insulin themselves seem to reduce magnesium status, possibly creating a vicious cycle.
In a 1993 trial, a low-magnesium diet reduced insulin sensitivity in healthy volunteers by 25% in just four weeks (8). It also increased urinary thromboxane concentration, a potential concern for cardiovascular health**.
At least three trials have shown that magnesium supplementation increases insulin sensitivity in insulin-resistant diabetics and non-diabetics (9, 10, 11). In some cases, the results were remarkable. In type II diabetics, 16 weeks of magnesium supplementation improved fasting glucose, calculated insulin sensitivity and HbA1c*** (12). HbA1c dropped by 22 percent.
In insulin resistant volunteers with low blood magnesium, magnesium supplementation for four months reduced estimated insulin resistance by 43 percent and decreased fasting insulin by 32 percent (13). This suggests to me that magnesium deficiency was probably one of the main reasons they were insulin resistant in the first place. But the study had another very interesting finding: magnesium improved the subjects' blood lipid profile remarkably. Total cholesterol decreased, LDL decreased, HDL increased and triglycerides decreased by a whopping 39 percent. The same thing had been reported in the medical literature decades earlier when doctors used magnesium injections to treat heart disease, and also in animals treated with magnesium. Magnesium supplementation also suppresses atherosclerosis (thickening and hardening of the arteries) in animal models, a fact that I may discuss in more detail at some point (14, 15).
In the previous study, participants were given 2.5 g magnesium chloride (MgCl2) per day. That's a bit more than the USDA recommended daily allowance (MgCl2 is mostly chloride by weight), in addition to what they were already getting from their diet. Most of a person's magnesium is in their bones, so correcting a deficiency by eating a nutritious diet may take a while.
Speaking of nutritious diets, how does one get magnesium? Good sources include halibut, leafy greens, chocolate and nuts. Bone broths are also an excellent source of highly absorbable magnesium. Whole grains and beans are also fairly good sources, while refined grains lack most of the magnesium in the whole grain. Organic foods, particularly artisanally produced foods from a farmer's market, are richer in magnesium because they grow on better soil and often use older varieties that are more nutritious.
The problem with seeds such as grains, beans and nuts is that they also contain phytic acid which prevents the absorption of magnesium and other minerals (16). Healthy non-industrial societies that relied on grains took great care in their preparation: they soaked them, often fermented them, and also frequently removed a portion of the bran before cooking (17). These steps all served to reduce the level of phytic acid and other anti-nutrients. I've posted a method for effectively reducing the amount of phytic acid in brown rice (18). Beans should ideally be soaked for 24 hours before cooking, preferably in warm water.
Industrial agriculture has systematically depleted our soil of many minerals, due to high-yield crop varieties and the fact that synthetic fertilizers only replace a few minerals. The mineral content of foods in the US, including magnesium, has dropped sharply in the last 50 years. The reason we need to use fertilizers in the first place is that we've broken the natural nutrient cycle in which minerals always return to the soil in the same place they were removed. In 21st century America, minerals are removed from the soil, pass through our toilets, and end up in the landfill or in waste water. This will continue until we find an acceptable way to return human feces and urine to agricultural soil, as many cultures do to this day****.
I believe that an adequate magnesium intake is critical for proper insulin sensitivity and overall health.
* Zucker rats that lack leptin signaling
** Thromboxane A2 is an omega-6 derived eicosanoid that potently constricts blood vessels and promotes blood clotting. It's interesting that magnesium has such a strong effect on it. It indicates that fatty acid balance is not the only major influence on eicosanoid production.
*** Glycated hemoglobin. A measure of the average blood glucose level over the past few weeks.
**** Anyone interested in further reading on this should look up The Humanure Handbook
Wednesday, November 3, 2010
Liability Issues For Builders
In an effort to reduce costs, add value, and become more efficient, the building industry is constantly looking for new products and ways to be innovative which may or may not stand the test of time. Some prime examples of this are synthetic stucco (EIFS), masonite siding, polybutylene plumbing, and Chinese drywall.
About 10 years ago the insurance industry was hit hard with a construction defect crisis due to the use of some of these products. At the time, most of the costs of covering these defects were covered by the General Liability policies of the builders, manufacturers, and distributors. This led to two major insurance changes for these industries: First, most insurers left the market deciding that they could not be profitable at any premium with these classes of business. Second, the remaining insurers decided that they did not want to fund the next wave of construction defect claims. This resulted in adopting exclusion endorsements that could be added to their policies that are designed to limit their risk.
The following are some common exclusions which can severely limit coverage for builders:
1) EIFS Exclusion: If you install or repair Synthetic Stucco, you very likely will need to purchase a special General Liability policy from the high-risk insurance markets.
2) Soil Movement Exclusion: Expansive soils can lead to and have been a major source for construction defect claims. You can usually pick up coverage for this through certain home owner's warranty products.
3) Absolute Pollution Exclusion: This is a powerful exclusion that can have consequences beyond what you normally think of as pollution. This is exemplified in the recently emerging Chinese drywall crisis where its alleged that drywall from certain plants in China release noxious fumes that cause corrosion of metal in a home, a foul smelling odor, and health problems. The insurance carriers plan on denying these claims by using the Absolute Pollution Exclusion. Pollution is broadly defined under this exclusion as any solid, liquid, or gaseous contaminant or irritant. Once again, if you are concerned about this exposure, you can buy a special Pollution Liability policy through the high risk marketplace.
4) Prior Completed Operations Exclusion: The standard General Liability policy form normally picks up coverage for building operations completed prior to the start of the policy term as long as the covered “property damage” or “bodily injury” occurs during the policy term. However, with the addition of the Prior Completed Operations Exclusion, coverage for prior completed operations is eliminated. This presents a problem because the General Liability forms from the prior years don’t pick up this coverage to the extent that the “property damage” or “bodily injury” occurs after the expiration of the prior policy terms. Some versions of this endorsement limit its scope to “property damage” only. You may want to attempt to negotiate the elimination of this endorsement if it appears on your policy.
5) Products / Completed Operations Exclusion: This exclusion has perhaps the most devastating impact of any of the construction defect exclusions. Quite simply, this exclusion eliminates coverage for all “bodily injury” and “property damage” that occurs after the home has been sold. This would require you as a builder to purchase separate warranties through another company or find an insurance carrier that will remove this exclusion.
6) Exclusion: Damage To Your Work Performed By Subcontractors On Your Behalf (CG2294): Around 2004, most carriers began adding this exclusion to builder’s General Liability policies to eliminate the favorable coverage exception that was granted to builders (that were general contractors) under the Property Damage To Your Work Exclusion listed above. The presence of CG2294 eliminates coverage for construction defect claims. If CG2294 appears on your policy, there are two viable solutions. First, ask if your carrier has a “buyback” of the lost coverage for an additional premium charge. Second, search for a carrier that has a less severe version of this exclusion that only eliminates coverage for “property damage” to the faulty work itself but not to resulting “property damage” to the non-faulty work. The best thing to do is to make sure you are collecting certificates of insurance from your sub-contractors naming you as an additional insured on their policy. Also, make sure you are working with subs who are stable enough to remain in business long after the job is completed. This exclusion has been added to separate liability between subs and GC's so the GC's insurance is designed to protect them for things which they are actually liable for.
It is imperative that builders employ aggressive risk management techniques to protect themselves and limit their losses. A couple things I recommend: First, contractually transfer these risks to your subcontractors by using hold-harmless agreements and enforcing insurance requirements. Second, make sure you thouroughly document construction files and be proactive in dispute resolution. Please contact me if you have any general questions about this or specific questions about your policy.
About 10 years ago the insurance industry was hit hard with a construction defect crisis due to the use of some of these products. At the time, most of the costs of covering these defects were covered by the General Liability policies of the builders, manufacturers, and distributors. This led to two major insurance changes for these industries: First, most insurers left the market deciding that they could not be profitable at any premium with these classes of business. Second, the remaining insurers decided that they did not want to fund the next wave of construction defect claims. This resulted in adopting exclusion endorsements that could be added to their policies that are designed to limit their risk.
The following are some common exclusions which can severely limit coverage for builders:
1) EIFS Exclusion: If you install or repair Synthetic Stucco, you very likely will need to purchase a special General Liability policy from the high-risk insurance markets.
2) Soil Movement Exclusion: Expansive soils can lead to and have been a major source for construction defect claims. You can usually pick up coverage for this through certain home owner's warranty products.
3) Absolute Pollution Exclusion: This is a powerful exclusion that can have consequences beyond what you normally think of as pollution. This is exemplified in the recently emerging Chinese drywall crisis where its alleged that drywall from certain plants in China release noxious fumes that cause corrosion of metal in a home, a foul smelling odor, and health problems. The insurance carriers plan on denying these claims by using the Absolute Pollution Exclusion. Pollution is broadly defined under this exclusion as any solid, liquid, or gaseous contaminant or irritant. Once again, if you are concerned about this exposure, you can buy a special Pollution Liability policy through the high risk marketplace.
4) Prior Completed Operations Exclusion: The standard General Liability policy form normally picks up coverage for building operations completed prior to the start of the policy term as long as the covered “property damage” or “bodily injury” occurs during the policy term. However, with the addition of the Prior Completed Operations Exclusion, coverage for prior completed operations is eliminated. This presents a problem because the General Liability forms from the prior years don’t pick up this coverage to the extent that the “property damage” or “bodily injury” occurs after the expiration of the prior policy terms. Some versions of this endorsement limit its scope to “property damage” only. You may want to attempt to negotiate the elimination of this endorsement if it appears on your policy.
5) Products / Completed Operations Exclusion: This exclusion has perhaps the most devastating impact of any of the construction defect exclusions. Quite simply, this exclusion eliminates coverage for all “bodily injury” and “property damage” that occurs after the home has been sold. This would require you as a builder to purchase separate warranties through another company or find an insurance carrier that will remove this exclusion.
6) Exclusion: Damage To Your Work Performed By Subcontractors On Your Behalf (CG2294): Around 2004, most carriers began adding this exclusion to builder’s General Liability policies to eliminate the favorable coverage exception that was granted to builders (that were general contractors) under the Property Damage To Your Work Exclusion listed above. The presence of CG2294 eliminates coverage for construction defect claims. If CG2294 appears on your policy, there are two viable solutions. First, ask if your carrier has a “buyback” of the lost coverage for an additional premium charge. Second, search for a carrier that has a less severe version of this exclusion that only eliminates coverage for “property damage” to the faulty work itself but not to resulting “property damage” to the non-faulty work. The best thing to do is to make sure you are collecting certificates of insurance from your sub-contractors naming you as an additional insured on their policy. Also, make sure you are working with subs who are stable enough to remain in business long after the job is completed. This exclusion has been added to separate liability between subs and GC's so the GC's insurance is designed to protect them for things which they are actually liable for.
It is imperative that builders employ aggressive risk management techniques to protect themselves and limit their losses. A couple things I recommend: First, contractually transfer these risks to your subcontractors by using hold-harmless agreements and enforcing insurance requirements. Second, make sure you thouroughly document construction files and be proactive in dispute resolution. Please contact me if you have any general questions about this or specific questions about your policy.
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