RMV Changes to the MA State Markings Regulation 540 CMR 2:22

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There has been a change to the Massachusetts State Markings Regulation 540 CMR 2:22 (regulation text below) that will take effect on September 1, 2018 for all commercial motor vehicles that weigh 10,001 lbs. or more used in Intrastate commerce. The RMV changes could affect customers that are written on a Massachusetts Auto Policy class 30 such as plumbers, carpenters, electrician, etc.

The updated regulation affects the type and placement of vehicle markings and will also require any vehicle used in intrastate commerce to have a US DOT number. Affected vehicles include those that are:

  • Engaged in intrastate commerce having a gross vehicle weight rating or gross combination weight rating of 10,001 or more pounds; or
  • Used in the transportation of hazardous materials in a quantity requiring placarding; or
  • Designed to transport more than 15 passengers including the driver, used in intrastate commerce in Massachusetts.

The Massachusetts State Police Truck team has been stopping people to let them know that by September 1, 2018, the USDOT numbers need to be filed with the Federal Motor Carrier Safety Administration (FMCSA) and visible on their vehicles. Click here for a copy of the notice that the State Police Truck Team is handing out.

The updated regulation language is as follows:

2.22: Markings on Commercial Vehicles

(1) Marking.

(a) Effective until August 31, 2018. The owner of every motor truck used for the transportation of goods, wares or merchandise for hire, gain or reward, shall have the owner’s name marked on the truck, to be plainly visible from each side or from the front and rear of the vehicle, provided that motor trucks operated under a lease of more than 30 days shall display either the name of the owner or the lessee, and may display both. For the purpose of 540 CMR 2.22(1), motor truck shall mean any motor vehicle specially designed or equipped to transport personal property over the ways of the Commonwealth and which has a maximum load carrying capacity of over 2,000 lbs., and which is not a Private Passenger Motor Vehicle under 540 CMR 2.05. To the extent there is any conflict between 540 CMR 2.22 and any federal regulation pertaining to markings on commercial motor vehicles, the federal regulation shall control.

(b) Effective September 1, 2018. The owner of every motor truck used for the transportation of goods, wares or merchandise for hire, gain or reward, shall have the owner’s name marked on the truck, to be plainly visible from each side, be in permanent letters that contrast sharply in color with the background on which the letters are placed; be readily legible during daylight hours from a distance of 50 feet while the motor truck is stationary; and be kept and maintained in a manner that retains the legibility required by 540 CMR 2.22(1)(b), provided that motor trucks owned or controlled by a farmer and used to transport agricultural products, farm machinery, and/or farm supplies to or from the farmer’s farm; not used in the operation of a common or contract carrier, and used within 150 air miles of the farmer’s farm need not be so marked; and motor trucks operated under a lease of more than 30 days shall display either the name of the owner or the lessee, and may display both. For the purpose of 540 CMR 2.22(1), Motor Truck shall mean any motor vehicle specially designed or equipped to transport personal property over the ways of the Commonwealth and which has a maximum load carrying capacity of between 2,000 lbs. and 10,000 lbs. and which is not a Private Passenger Motor Vehicle under 540 CMR 2.05. To the extent there is any conflict between 540 CMR 2.22 and any federal regulation pertaining to markings on commercial motor vehicles, the federal regulation shall control.

(2) U.S. DOT Number Assignment for Intrastate Carriers. Effective September 1, 2018, every motor vehicle engaged in intrastate commerce in Massachusetts having a gross vehicle weight rating or gross combination weight rating of 10,001 or more lbs.; and every motor vehicle regardless of weight, engaged in intrastate commerce in Massachusetts and used in the transportation of hazardous materials in a quantity requiring placarding; and every motor vehicle designed to transport more than 15 passengers, including the driver, used in intrastate commerce in Massachusetts must be permanently marked with a USDOT number assigned in a manner conforming to the provisions of 49 CFR 390.21.

(3) Penalty. The penalty for a violation of 540 CMR 2.22 is set forth in M.G.L. c. 90, § 20.

 

Click here for more information on 540 CRM 2.22

 

 

 

Leaving Home – Insurance Concerns

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Presented by: Christopher F. Hawthorne, CPCU, CIC

When a child moves out of the home, it can be both exciting and heartbreaking. As one phase of life is ending, another wonderful one begins. However, the danger lurking within the parents’ home and auto insurance, as well as within certain privacy laws, can often be overlooked. Both home and auto policies have limitations that can leave a family vulnerable in terms of its financial wellbeing, and privacy laws can leave parents in the dark about their child’s physical wellbeing.

If a child is moving out to live with friends, they have, in effect, set up their own household. If a lease is present, it is clear that there is now a separate residence, even if the child is renting a unit owned by the parent.

If a child is in college, they are typically considered part of the household. However, if during college they rent an apartment outside of the dorm system, then they have created a separate household.

Addressing these issues will help secure the financial wellbeing and peace of mind for both the parents and the child.

Renters Insurance

While a person at this stage may not own much in the way of personal property, they still have much to lose. Along with personal property such as clothing and furniture, a Renters Policy (HO4) also provides liability protection. For example:

• While attending a cookout, a Frisbee flies off-course and lands at a person’s feet. They pick it up to toss it back to the thrower and when they do, the Frisbee misses and slashes someone’s eye. The injured party or their insurance company (health or disability) may come after the person who threw the Frisbee for compensation.

• While in an apartment, the renter starts a fire which causes significant damage. The roommates, neighbors and landlord may pursue the individual for compensation.

In addition, many leases hold the renter liable and not the landlord. Therefore, if a guest visiting the individual slips, falls, and is injured, for example, the renter will be the responsible party.

For those starting out on a bright career path, they may live in a state where future wages can be garnished. If this is the case, without renter’s insurance, the liabilities described above could cancel out much of the financial benefits of the bright career.

If parents or a trust financially support the renter, the injured parties might try to get to the parental or trust assets. Renters coverage will place a barrier between the parental assets that hopefully can pay for any liabilities and if there is a trust in play, the trust should be named as an Additional Insured on the renter’s policy.

If the lease is in the parent’s name, the parents Homeowners policy should be amended to extend coverage E to cover the new location.

Auto Insurance

In Massachusetts, once a child is no longer a resident of the parents’ home, they are no longer covered by the parents’ policy while driving vehicles not owned by their parents. If the child drives a rental car or a friend’s car, their financial wellbeing is at risk because they have no personal protection. In this situation, a Named Non-Owned Auto policy in the name of the child would be appropriate. A Named Non-Owned Auto policy is simply an auto policy without an auto listed and therefore has no Comprehensive and Collision coverage. If the child is driving a car provided by the parents, an alternative would be to retitle the car in the child’s name.

If the child is using a parent’s auto for work purposes such as delivery or Uber, it is critical to report this to the insurance carrier. Unreported commercial use can reduce the limits of protection to Massachusetts Statutory limits such as reducing Bodily Injury of Others from $250,000/$250,000 to $20,000/$40,000.

If the child takes the car out of the state, that must be reported as well to preserve the Comprehensive coverage for glass, theft, and vandalism.

Privacy

Once a person turns eighteen, a parent loses the right to know personal information about their child without the child’s permission. If a child is hospitalized, the hospital is not allowed to reach out to the parents or even share the child’s status with the parents. When a child turns eighteen, parents may wish to discuss with their attorney about obtaining a Health Care Proxy and a Durable Power of Attorney.

Summary

When a child is making their way out of their parents’ home, it can be a dangerous period for the financial wellbeing of both the parents and the child. Insurance agents (and a lawyer), the parents, and the individual leaving home should work closely with one another to make sure everyone is protected appropriately. Education and communication go a long way in this area, and the good news is that the solutions are not expensive.

Left unaddressed, the financial and emotional ramifications of inadequate coverage can be devastating.

Living Benefits of Whole Life Insurance

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* Tax-free source of cash

  • Cash values can be accessed either as loans or withdrawals to cost basis and then loans
  • Dividends can be taken in cash, as opposed to buying paid-up additions

* Supplemental income at retirement for Key Employees using

  • Deferred Compensation Plan
  • Section 162 Executive Bonus
  • Split Dollar Plan

* Supplemental income at retirement for Individuals

* Out-of-pocket costs may be reduced as policy cash values grow

Shining a Light on Moonlighting

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Presented by: Christopher F. Hawthorne

Many contractor businessowners face the question of what to do about employees that moonlight at night and on weekends. Does allowing employees to moonlight put a business in harm’s way? It could.

When an employee moonlights, they are taking on the same general liability, workers compensation, and auto exposures as the employer. Even if the employee carries their own insurance, their actions may be increasing the employer’s liability and future insurance costs.

If a moonlighting employee uses the employer’s vehicle which is still dressed with the employer’s logo, and is using the employer’s tools, could the customer state that they thought they were working with the employer after a loss occurred? Since the moonlighting employee might have little or no coverage, it is conceivable that the customer might look to the employer for coverage for damage done by the moonlighting employee. If so, the employer’s general liability, commercial auto, or even workers compensation would respond to a claim filed against the employer.

When the commercial general liability policy is examined for its wording, there are several troublesome areas. The first is the definition of an insured; it includes employees acting in the scope of their employment. This is not great wording in terms of your own protection. Second, the definition of your product includes products traded or sold under “your” name. If the employee is there with the employer’s truck, logo and knowledge, could an attorney-an insurance attorney at that-make a case to pull the employer in? Is this a bet worth taking? As contractors with claims experience know, the process can be unfair, and it can cost significant future premiums while the argument is going through court. The fact that the employer allowed moonlighting to occur makes a strong argument for vicarious liability.

If the employee got hurt while moonlighting, it could potentially pull the employer’s workers compensation (wherein, the employee might rope in professional legal counsel similar to the ones dealing with workers comp attorney in Columbus OH) in. If the employee worked for a few hours the next day and claimed that the injury really happened on the employer’s job, the employer’s workers compensation would be forced to prove the employee was not working at his or her job at the time of the injury. This could prove to be quite difficult and the employer’s workers compensation may end up paying the claim.

If the employer’s vehicle is being used with the employer’s permission, the commercial auto and possibly the umbrella would definitely be involved in a claim should there be an accident.

In short, without being paid for the risk, the employer is at risk. Contractors may wish to consider making it a condition of employment that moonlighting is not allowed. Two methods for preventing moonlight, along with a written policy, are as follows:

  • Equip company vehicles with GPS monitoring so the employer can see when a vehicle is in use after hours. There have been several reported cases of GPS monitoring even identifying employees that moonlight while on duty for the employer!
  • Leave all company vehicles, tools, and uniforms at the employer’s business location each night. This may require the employer to provide a changing area and cleaning service.

Employees should know that their personal homeowner’s insurance provides no liability for their business pursuits. From both the employer and the employee’s point of view, moonlighting is not a good idea.

The good news for employers is there are options to help reduce moonlighting. A possible solution may be to offer employees commissions for business they bring in. They could also offer discount pricing for the employees friends and family. These two options would help satisfy the employees desire to increase their income and alleviate the pressure of helping their friends and family after work.

Commercial Auto Insurance

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What is DOC?

Presented by Christopher F. Hawthorne, CPCU, CIC

Often people own a vehicle that is in the name of a business with no vehicle in their personal name to be used both personally and commercially. This ownership structure puts one in a position of not having auto insurance coverage in certain situations.

Commercial auto policies work differently than MA personal auto policies. The MA personal auto policy will cover anyone using an insured vehicle if operating with the permission of the vehicle’s owner. The coverage will also follow the insured and those listed on the policy into any other personal vehicle as long as they are operating that vehicle with permission. It is a very flexible policy.

The commercial auto policy is not so flexible. The commercial policy states that it will cover those vehicles that are specifically listed on the policy. Also, the commercial policy will defend the commercial entity named on the policy. This design could leave the driver of a commercially owned vehicle in harms way when they are operating a vehicle not listed on the commercial auto policy.

EXAMPLE: A business owner is attending a family cookout, driving a commercially-owned vehicle and due to getting there early, his/her auto has been blocked in by other guests. The host asks him/her to run to the store for more ice and to take another guest’s car which is not blocked in. During the trip, he/she hits and injures someone, who then sues him/her as well as the owner of the vehicle. If the owner of the vehicle unknowingly had coverage cancelled for non-payment due to an oversight or if the owner simply carried very low liability limits, the business owner who is used to having $1,000,000 of protection from their commercial auto policy as well as possible umbrella coverage, suddenly finds himself/herself on the other end of a lawsuit with little or no coverage.

A solution is to add Drive Other Car (DOC) coverage to the commercial auto policy. This coverage will act as a bridge for when the business owner is using a vehicle not named on the commercial auto policy. When DOC coverage is added, it is added in the name of a driver. The coverage will protect the named person and a spouse. It is important to know it will not automatically cover any other family members. Therefore, each family member other than the spouse must be named separately. The typical cost is typically $300 to $350 per named driver.

A second solution is to purchase a Named Non-Owned Personal Auto policy.  This policy is the equivalent of a personal auto policy but without an auto (no comprehensive or collision coverage). These policies are more expensive ($800+) however they are more flexible and protect the commercial auto policy from claims arising out of personal auto use.

Ways to Foster Workplace Wellness

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Managing an office that promotes a healthy work-life balance is a trial-and-error process. Between constant accessibility as a result of technology and the pressure to meet deadlines, employee and workplace wellness is too often compromised.

It may not seem like your responsibility, but you want to encourage your employees to balance their personal and professional wellness. Some of the most successful companies in the country are investing in their employees’ wellness.

We’re here to help. Below are five ways to implement workplace wellness in your office.

Get up and active

Identify a workout studio that is close to your office location and attend a class as a group. Encourage people to initiate fitness groups within the office, or opt for walking meetings. Apps like Eventbrite and Groupon sometimes post special deals for companies looking to explore fitness.

Professional and continuing education

Employee and workplace wellness is not always about physical health – it includes mental, intellectual, and emotional. Remind your employees that their careers and growth are important to you. You can show that you mean it by going the extra mile and getting your employees in touch with wellness professionals from the likes of LeggUp (https://www.leggup.com/) or similar coaching platforms, and help them unload mentally to stay sane. Furthermore, you can offer to cover the cost of educational workshops and classes that will help people improve the work they do and strengthen their confidence in their trades. You can read up on blogs such as https://www.edenhealth.com/blog/what-are-employee-benefits/ to learn more about the aspects of employee benefits that could be integrated into the corporate culture.

Keep hydrated and improve workplace snacking options

That third cup of coffee is doing nothing to hydrate you. Water is extremely important to keep your body healthy – from your skin to your kidneys to your blood pressure – and often goes by the wayside during the busy day. Design company water bottles as a friendly reminder to your employees to prioritize hydration. If the budget allows, invest in a flavored water dispenser like this one.

Mandatory mental health days

Well, maybe not mandatory, but employers can do a much better job emphasizing the importance of mental health days. Your employees are hard-working and don’t want to be seen as slackers, though they might very much need a personal day every so often. Drop hints that you are understanding as an employer and encourage your staff to take time when they need it.

Modernize your desk and other office furniture

The research is in: desks are not healthy. Employees are often seen to be complaining about the issues in the office’s furniture, poor utilization of workspace, and absence of recreational places. For the employer, sometimes, these problems might not seem genuine, however, when ignored for a long period, it can affect the productivity of the employees. An office interior design expert might help with easy solutions for problems such as these. Also, did you know that some companies are replacing their chairs with a yoga balls as a way to fix employees’ posture and burn calories? Others are opting for adjustable desks, which allow workers to sit or stand. Both of these options often result in an increase in productivity and decrease in back pain. All in all, one must know that good office equipment and furniture could prove to go a long way in improving posture and overall health!

Get some sunshine

Encourage your employees to get their daily dose of vitamin D when the weather allows for it. Set an example by eating lunch outside or making it known that you are going for a walk.

The bottom line is this: employee and workplace wellness is not optional, it’s essential. Not only will it help your employee retention, but an increase in productivity and workplace happiness will only benefit your business.

Study Shows Majority of Boston Area Small Businesses Are Overexposed to Risk

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56-percent of companies failed a business risk assessment, operating without basic safeguards against damage caused by cyber-attacks, HR issues and other common operational realities

This past summer, we conducted a study to see just how aware Boston area small business owners are of their overall insurance coverage. This was the first study of its kind; we call it the Cleary Small Business Risk Index.

The results were scary.

The Index shows that more than half (55%) of Boston area businesses failed a risk assessment that probed 19 areas of risk management including cyber security, professional liability, employment practices and more.

So what does this boil down to?

“This proved what we have always assumed – most business owners don’t understand how to properly assess or account for risk,” said Bill Cleary, president, Cleary Insurance. “The answer isn’t always ‘more insurance.’  There are many ways to offload, avoid or manage risk. But in order to succeed, you need to understand the basic situation, and too many business owners just don’t.”

The Boston-area wide survey (including businesses on the North Shore, South Shore and Metrowest) was conducted online questioning 100 business owners, operators and employees spanning a variety of industries including healthcare, retail, financial services, and more.  All respondents had a significant influence on the operational decisions of each company.

Could you pass? Take the Cleary Small Business Risk Assessment today to test your understanding of coverage.  Also, check back for the next few posts which outline and answer some of the greatest areas for risk.

Is Your Business Prepared for a Natural Disaster?

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While all businesses should have a plan in place to protect their employees and their bottom line when a natural disaster hits, they should also consider their location and the insurance that is necessary to keep their doors open after a catastrophic event.

For a detailed disaster plan you can visit  the link:  https://www.fema.gov/pdf/library/bizindst.pdf

Reviewing the insurance plan:

Businesses should review their insurance plan to reduce out of pocket expenses.  Make sure you have significant coverage to pay for the indirect costs of the disaster, disruption to your business and the cost to repair or rebuild your premises.  Most policies do not cover flood or earthquake damage and you may need to buy separate insurance for these perils. Be sure you understand your policy deductibles and limits.  New additions or improvements should also be reflected in your policy. This includes construction improvement to a property and the addition of new equipment.

For a business, the costs of a disaster can extend beyond the physical damage to the premises, equipment, furniture and other business property. There’s the potential loss of income while the premises are unusable. Your policy should include business interruption insurance and extra expense insurance. Even if your basic policy covers expenses and loss of net business income, it may not cover income interruptions due to damage that occurs away from your premises, such as to your key customer or supplier or to your utility company. You can generally buy this additional coverage and add it to your existing policy.

Basic commercial insurance to consider:

  • Building coverage provides coverage up to the insured value of the building if it is destroyed or damaged by wind/hail, or another covered cause of loss. This policy does not cover damage caused by a flood or storm surge nor does it cover losses due to earth movement, such as a landslide or earthquake, unless added by endorsement.
  • Business personal property provides coverage for contents and business inventory damaged or destroyed by wind/hail, or another covered cause of loss.
  • Tenants improvements and betterments provides coverage for fixtures, alterations, installations, or additions made as part of the building that the insured occupies but does not own, which are acquired and made at the insured’s expense.
  • Additional property coverage provides for items such as fences, pools or awnings at the insured location. Coverage limits vary by type of additional property.
  • Business income provides coverage for lost revenue and normal operating expenses if the place of business becomes uninhabitable after a loss during the time repairs are being made.
  • Extra expense provides coverage for the extra expenses incurred, such as temporary relocation or leasing of business equipment, to avoid or minimize the suspension of operations during the time that repairs are being completed to the normal place of business.
  • Ordinance or law provides coverage to rebuild or repair the building in compliance with the most recent local building codes.

Questions to ask yourself when assessing your personal insurance needs

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In light of the recent natural disasters happening around the globe, we are unfortunately reminded of the importance of obtaining proper personal insurance. If you are a homeowner, it is pertinent to routinely assess your personal insurance policy’s coverage. Unforeseen events (knock on wood) happen, and at that time you will be relieved of one less stress with the proper policy.

Personal insurance can range from home to auto, and rental to expensive items like jewelry and electronics. If you have something of value that is not yet covered by insurance, there is no harm in learning about your options.

We’re here to help with the legwork. Below are a few questions you can ask yourself when evaluating your personal insurance policy.

  • How much coverage is enough for my home?
  • What would it cost to replace my belongings?
  • Do I need or have reimbursement for additional living expenses if I can’t live in my home due to loss?
  • How much would it cost to repair the inside of my home if it were damaged?
  • Should I get insurance in the case of natural disasters (i.e. flood, earthquake, hurricane, etc.)?

The goal of personal insurance is to guarantee your family is secure, financially and emotionally. At Cleary, we believe a solid insurance policy is a necessary step in order for your family to live life to the fullest. Contact us with any questions.