March 1, 2011  

California Business Owner Convicted of Insurance Fraud

Here’s a word of advice for you: If you’re a business owner, make sure you’re accurately reporting your payroll on your workers compensation insurance policy. If you are using subcontractors/ independent contractors to perform services for your clients, you must obtain a certificate of insurance from these contractors confirming they carry their own workers compensation insurance coverage. If not, you may be liable for any losses that occur as a result of the services they are performing for your business.

Here’s a friendly reminder that it doesn’t pay to cheat the system:

California insurance commissioner, Dave Jones, announced in a press release on 2/23 the conviction of a California business owner for insurance fraud and perjury. The case involves a $1.6 Million penalty for failure to pay premiums and failure to accurately report payroll.

Ronald J. Haas Sr., 69, has been convicted on 10 counts of insurance fraud for failing to accurately report payroll and for failing to pay insurance premiums to his workers’ compensation insurance carriers.  Haas was sentenced to one year in the county jail and restitution to the entities involved, and three years probation.

“Workers’ compensation insurance fraud is an egregious offense and it will be fully investigated by my Department,” said Commissioner Dave Jones. “Those who would seek to cheat a fund to help workers who were legitimately injured will be prosecuted to the fullest extent of the law.”

On January 12, 2007, State Compensation Insurance Fund Special (SCIF) reported a suspected fraudulent claim to the California Department of Insurance Fraud Division for investigation of suspected workers’ compensation insurance premium fraud. The report alleged that Haas, President of R J Haas Construction Corporation, et al., Saratoga, CA, failed to accurately report employee payroll to his workers’ compensation insurance carrier, SCIF. From July 1, 1998 to June 1, 2005, Haas claimed that he had no employees and that sub-contractors did all the work for his company. However, during this period, four workers’ compensation claims were filed by injured employees. Haas reported payroll to SCIF only after an injury was discovered and then payroll reporting stopped shortly thereafter, with the cancellation of his policy. Subsequently, Haas obtained workers compensation insurance policies through First Comp and again reported minimal to no employees.

An investigation by the Silicon Valley Regional Office of the California Department of Insurance, Fraud Division and the California Employment Development Department (EDD) revealed that Haas misrepresented office staff, project superintendents, foremen, and even some of his own family members as subcontractors. A forensic audit was conducted and revealed that Haas owed $594,293.22 in insurance premiums to SCIF, $229,167.71 in insurance premiums to First Comp and $813,328.27 to EDD for failing to accurately report employee payroll for the purpose of determining employment tax liabilities.

On April 29, 2009, Haas was arrested for felony violations of Insurance Code. Haas is eligible to apply for a home electronic monitoring program in lieu of county jail time. At time of sentencing Haas had already paid the full amount of restitution owed to insurance carriers SCIF and First Comp and to EDD.

Source: California Department of Insurance

-JK

February 26, 2011  

Insurance Topics In the News (2/20-2/26)

  • Need an Employee Handbook? Download one here for free and customize.
  • Employee Romances and Sexual Harassment – Double the Trouble When It Originates from the Top: Read
  • New Zealand’s Earthquake May Become Costliest Insured Disaster Since 2008

A powerful earthquake struck one of New Zealand's biggest cities, Christchurch, Tuesday at the height of a busy workday, toppling tall buildings and churches, crushing buses and killing dozens of people in one of the country's worst natural disasters.

–JK

February 24, 2011  

Has An Earthquake Detection System Become Reality??

Plain and simple, natural disasters are horrendous! To put it politely, they S-U-C-K! Floods, tornado’s, hurricane’s, volcanic eruption’s, landslide’s, and notoriously here in California…earthquakes! All these natural disasters lead to some kind of loss, whether it be financial, environmental, or human loss. In most cases, there’s actually some degree of advanced warning as to when a natural disaster might strike. Take hurricane’s for example. We are able to pinpoint powerful storms in advance and prepare accordingly.  If nothing else, this allows us to reduce the probability of human loss.

Unfortunately, advanced warning does not apply when it comes to the earth shifting, otherwise known as EARTHQUAKES! ………Or does it??

In an article published by Fox News, there is now “a state-of-the-art, first-in-the-world earthquake detection system in now installed and operational” in southern California, near Palm Springs, in the Coachella Valley.  In fact, twelve locations are now in place with 120 sites planned, all meant to detect an earthquake and give people a chance to duck and cover, or brace themselves before the shaking begins.

This earthquake detection system was created by a company called QuakeGuard. The system works by way of sensors which are designed to detect the initial, or “P” energy waves given off by every quake, even though it’s only the later, or “S” waves that do all the damage. The time in-between the two waves varies depending on the proximity to the epicenter and as the first sensor closest to the quake goes off, it can offer advance notice — from a few seconds to a full minute– to other locations farther away.

The system can also be set to automatically open fire station doors, and water and gas valves for municipalities could be shut off. Back-up generators for hospitals could be turned on and, most importantly, warn school kids to duck and take cover.

Of the 12 sets of sensors currently set in place throughout the Coachella Valley in Southern California, all are tied to fire stations. Soon, they will be networked to every school in the area. Down the road, they can possibly be  linked to hospitals, private businesses and even people’s homes.

A mobile system is also in development and would help rescue crews detect aftershocks. A few seconds could get rescuers out from under the rubble and thus out of harm’s way.

How great would this be for California or for any other regions affected by the earth moving?? It’ll be interesting to see how technology progresses. In this case, not soon enough! We can’t stop an earthquake, but it would be nice to be warned if one is on the way . The sudden jolt of the earth shifting is the probably the scariest part of an earthquake in my opinion. Let alone the damage and destruction that comes with it.

Would an earthquake detection system ease your fear of earthquakes?

–JK

February 19, 2011  

Lessons Learned – Week of February 13, 2011

THEFT: This cat gives a new meaning to the term Cat Burglar.

To put an insurance spin on this one, it’s worth noting that theft is covered on most property insurance policies, unless excluded by an endorsement. Be sure to check with your agent.

–JK

February 16, 2011  

Distracted Driving- Auto Accidents Don’t Announce Themselves

Have you seen this comical Lexus commercial on the air pertaining to distracted driving? This one really applies to everyone on the road. Auto accidents don’t announce themselves.

After watching the video, check out the tips below to avoid distracted driving. Be safe out there.

Tips to avoid distracted driving

  1. Be well rested and alert before driving.
  2. Keep safe driving as your first priority when driving.
  3. Consider taking a defensive driving course.
  4. Park to eat.
  5. Drink with a lid on your cup, only going slow and straight or stopped.
  6. Don’t hold a cup between your knees while driving.
  7. Pull to the curb to read a map or directions.
  8. Find out what landmarks are near your destination before arriving.
  9. Tell your passengers you need to keep your eyes on the road.
  10. Keep sun glasses within reach.
  11. Check rearview mirror BEFORE you enter a curve or turn.
  12. Keep both hands on the steering wheel in a curve or turn.
  13. Use restraints for your pet when you drive with them in the car.

–JK

February 14, 2011  

Valentine’s Day: Big Love or Big Business?

Valentine’s Day. The day of love and romance? Or an excuse for consumerism and business opportunity? Everyone has their own take on the “holiday”. What’s yours?

To go along with the theme of the day, check out these Valentine’s Day statistics:

  • 85% of all Valentine cards are bought by women.
  • Chocolate and candy sales reach profits of $1,011 billion during Valentines
  • 73% of flowers are bought by men, and only 27% are by women.
  • Over 1 billion Valentine cards are exchanged in the U.S each year. It’s the largest seasonal card-sending occasion of the year, next to Christmas.
  • About 3% of pet owners will give Valentine’s Day gifts to their pets.
  • California produces 60% of American roses, but the vast number sold on Valentine’s Day in the United States are imported mostly from South America. Approximately 110 million roses, the majority of which are red, will be sold and delivered within a three-day time period.
  • $72 is the average amount women spend on gifts on Valentine’s Day; $135 is the average amount men spend.
  • 25% of people treat their significant others to an evening out.
  • The main consumers of Valentine’s Day merchandise are between 25 and 34, with each spending an average of 164 dollars.
  • Consumers are expected to purchase more than $345 million in chocolate candy during Valentine’s week, accounting for 5.1% of annual sales in the chocolate candy category. Consumers will purchase more than $448 million worth of total candy during Valentine’s week.
  • Valentine’s week is one of the top weeks for sparkling wine sales, with more than $8.6 million in sales. More than 881,000 bottles of sparkling wine will be sold during the holiday week. Only Thanksgiving, Christmas and New Year’s have higher sales.
  • Seventy million Americans will celebrate Valentine’s Day at a restaurant this year, according to the National Restaurant Association.

–JK

February 10, 2011  

Back From A Break

I was fortunate enough to have been in Hawaii for four days and have been away from the computer. It was a great little retreat. The weather was awesome and there was a lot of time to relax and take it all in. I have a ton of great pictures, but here’s a little video clip I took of the waves crashing on the rocks at Kapa’a Beach Park in Kamuela, HI which is about an hour drive from Kona:

Kapa’a Beach Park Kamuela, HI on the big map

Who has been to Hawaii? What’s your favorite island?

–JK

February 3, 2011  

Winter Blizzards- Tips For Winter Driving

Take a look at this accident footage from Salem, NH. I feel kind of guilty writing this post from Southern California as virtually everyone east of us is getting hammered with  snow, but I guess the cost of living makes up for it sometimes. With that being said, below the video clip are winter driving tips courtesy of Travelers Insurance. There wouldn’t be any legitimacy to these recommendations if they came directly from me. What does a Los Angeles native know about driving in the snow anyways??

Prepare for winter driving before a storm hits

  • Have a mechanic check your car’s battery, brakes, fluid levels (antifreeze, windshield washer fluid and oil), as well as the heating and exhaust systems to ensure that your car is in good, safe working condition.
  • Try to keep your gas tank full during the winter months. Don’t allow the gas to go below half a tank. Not only will this prevent damage from freezing, you’ll avoid running out of gas if you’re stuck in a traffic jam during the dead of winter.
  • Install snow tires or all-weather radials with adequate treads.
  • An adequate supply of windshield washing liquid is critical to wash away the mud and melted snow that can severely limit visibility.
  • Prepare for an emergency. Keep blankets, flares, a sack of sand for traction, shovel, windshield scraper and brush, tool kit, tow-rope, booster cables and a flashlight with extra batteries in your trunk. You should also stock your car with material for survival, such as waterproof matches to melt snow for drinking water, a first aid kit, dry clothing and a brightly colored cloth (to tie to the antenna).

When driving under adverse winter conditions

  • Take care pulling out of streets blocked by mountains of snow. It’s often difficult to see who or what is coming.
  • Back your car into the driveway so you have better vision when pulling out.
  • Be aware of joggers on the street. Often sidewalks are impassable and die-hard joggers venture onto the street for a clearer path. Unfortunately, they may not see icy spots or other hazards hidden below the slush.
  • Don’t turn corners too tightly.
  • If your car does not have anti-lock brakes and you start skidding on the ice, try not to slam on your brakes. Gently pump your brakes to maintain better control and prevent your wheels from locking.
  • If your car does have anti-lock brakes, slam on your brakes when skidding on the ice. Pumping your brakes prevents the anti-lock system from taking over.

Traveling during a severe storm. Travel only if necessary during a blizzard or severe storm. If you must travel:

  • Don’t travel alone. Notify someone of your estimated time of arrival as well as your primary and alternate travel routes.
  • If STUCK, stay in the car and wait for help. Run the engine and heater sparingly. Also make sure your exhaust pipe is clear of snow and ventilate your car so that carbon monoxide fumes won’t poison you.
  • Keep your energy. Eat food that provides the body with energy for producing its own heat. Replenish your body with fluids to prevent dehydration. Don’t eat snow; it will lower your body temperature. Melt it first.

Source: Travelers Insurance; Insurance Information Institute

–JK

February 1, 2011  

NY Tortilla Factory Shut Down After Fatal Work Related Accident

Earlier this week, a Brooklyn, NY tortilla factory employee died after falling into a waist-high dough mixing machine. Now, the state has closed the factory because authorities discovered the company’s workers compensation policy had lapsed in March 2010.

A NY State Workers Compensation spokesman said, “The owner would need to get the insurance and pay fines before he is permitted to reopen.” While the Workers Comp board doesn’t always shut down companies where the insurance is lapsed, the fact that there was a workplace death prompted officials to visit the tortilla factory. As it stands, the company owes $56,000 in penalties. OSHA and the Department of Labor are also looking into the incident.

This $56,000 in outstanding penalties is sure to be dwarfed by lawsuits likely to be coming from the employee’s family and surviving members. All this could have been avoided or significantly curtailed if the factory owner carried the workers compensation insurance coverage required by law.

The very core of workers compensation insurance is that it provides medical care for employees who are injured in the course of employment. Beyond medical care, Workers Comp insurance provides temporary and/or permanent disability benefits, supplemental job displacement benefits or vocational rehabilitation and death benefits. Workers Comp is a trade-off between employers and employees. Employees receive prompt effective medical treatment for on-the-job injuries or illnesses no matter who is at fault and, in return, are prevented from suing employers over those injuries.

The tortilla factory’s owner was reached on the phone by a newspaper Friday but said he couldn’t talk and hung up. He had previously said that the death was the first worker injury at the company and said it had been caused by “human error.”

Unfortunately, business owners usually learn the hard way when it comes to a loss. This being a prime, and severe, example. Personally, I would be surprised if this business survives considering what surely lies ahead with lawsuits, etc.

–JK

January 29, 2011  

Lessons Learned – Week of January 23, 2011

Hilarious vintage ‘Today Show’ clip of a much-befuddled Katie Couric struggling to figure out “What is the internet?”

How things have changed…

–JK

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