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Mack Group's Frequently Asked Questions 1. Why do I have to purchase a separate insurance policy for flood insurance?2. Why have insurance premiums been increasing so much? 3. Why is it so difficult to get Workers Compensation insurance in Florida? 4. When is it necessary for a business to purchase Workers Compensation insurance? 5. What is a Buy / Sell Agreement and why is it important to a business? 6. Do you know who the fastest growing insurance agency is in South Florida? (Hint-they are also the best) Back to Topics Why do I have to purchase a separate insurance policy for flood insurance? A loss resulting directly from the peril of a flood, which is defined as water rising from the ground, is an exclusion under your Homeowners policy and other Property Insurance policies. Back to Topics Why have insurance premiums been increasing so much? While the increases are beginning to subside, there are many reasons for the past increases. The most known reason is the attack of September 11th on New York City. In addition, jury awards have increased in most cases. More litigation than ever is occurring. Workers compensation fraud is a contributor. A recent poll uncovered that almost 50% of people surveyed feel it is okay to “pad” the bill in the event of an auto claim. More fraud! And then there is the fraud perpetrated by Enron, World Com, Adelphia and others. Collectively these all increase the losses paid out by insurance companies. Historically, insurance companies made up for losses with investment income, but now that interest rates are low and the stock market is down, they no longer make the investment revenue they used to make. The end result is that premiums have increased. Back to Topics Why is it so difficult to get Workers Compensation insurance in Florida? Florida is one of the most litigious states in the USA. Stay home from work some weekday and notice all the personal injury and workers compensation attorney advertisements on the television. They promise they can get you more money if you were injured on the job. Sometimes the award may be increased, but after attorney fees did the injured person get more money? In addition, there is a lot of workers comp fraud happening. The rates were just lowered on October 1, 2003 because of new legislation, and the companies are now waiting to see if the reforms justify the rate reductions. If the reforms work, we may see it become a bit easier to obtain workers compensation insurance. Back to Topics When is it necessary for a business to purchase Workers Compensation insurance? In our opinion it is necessary as soon as a business hires an employee. Workers Comp protects a business when an employee is injured on the job, and pays for the employee’s injuries and rehab. However, legally speaking, Workers Comp is required for non-construction businesses that have 4 or more employees, and for construction businesses that employ more than one person. Back to Topics What is a Buy / Sell Agreement and why is it important to a business? Many businesses either fail or are forced to sell when one of the owners unexpectedly dies or becomes unable to work. A Buy / Sell Agreement is a legal document that spells out what happens in the event of the death or disability of a partner or owner. When the unexpected event occurs, the family comes forward and wants their fair share of the business. The Agreement will spell out how to valuate the stock. The agreement is often funded with a life insurance policy and when a stockholder passes away, the process becomes seamless and the remaining partners and owners can continue on. However, many businesses overlook the need to also fund the agreement with disability insurance as well. Statistics show that someone is 66% more likely to become disabled, as opposed to dying, before the age of 65. Back to Topics Do you know who the fastest growing insurance agency is in South Florida? (Hint-they are also the best) That`s right! The Mack Group Inc. is, according to The South Florida Business Journal. Back to Topics |