Business Insurance Registration In Raritan Township, Hunterdon County

New Jersey Governor Murphy signed P.L. 2022, c.92 on August 5, 2022. Under this new state law, it is now illegal for any business or owner of a rental unit not to have liability insurance. The New Jersey law has left the implementation and enforcement of this new law to the local municipality.  Previously, there was no requirement under New Jersey (or Federal for that matter) law requiring a business owner to purchase Liability Insurance.

Flemington Borough in Hunterdon County, New Jersey introduced their local ordinance to implement this registration provision last fall. If you own a business or a rental unit(s) in Flemington Borough, you need to complete a registration and provide them with proof of insurance.

Recently, Raritan Township in Hunterdon County, New Jersey has issued regulations for their local ordinance to implement the State law. For Raritan Township, you will need a certificate of insurance and to register with the Township. They have an online portal to upload your certificate, complete your registration, and pay your $20 registration fee.

Because of the overlap in zip codes and mailing addresses between the Borough of Flemington, Raritan Township, and parts of several other townships, we are unable to quickly identify our clients located in Raritan Township.

If you are located in Raritan Township and own a business or own rental units (of any kind), please contact us so we can provide you with an insurance certificate that you can use for your business registration.

Please call us at the office or reach out to us here. We need to know the following information to issue these certificates:

  • The name of the business (or owner of the rental unit).
  • The location or address of the business or rental unit.
  • The township or borough where the unit or business is located.

We are here to help you manage your business and personal insurance program. Please feel free to contact us anytime if you have questions regarding the matters discussed in this article or on any aspect of your insurance plan.


What You Need to Know About Increasing Inflation Rates and Insurance

We are seeing the effects of high inflation in every aspect of our lives. Certainly, we are impacted by higher prices in food, energy, and consumer goods. Combined with the problems we are still feeling from supply chain issues that developed during the pandemic, it is no wonder that inflation is a major national issue.

Let’s review a few key areas where we will see how inflation will affect your insurance rates.

Higher Inflation Rates and Insurance

Higher inflation changes your insurance program as well. The most obvious effect is that we are seeing carriers start to increase their rates after a few years of flat pricing.  

While the rate of increase in insurance premiums will not be quite as high as you see in other areas of the economy, we think it is reasonable to expect increases of 5-8% in most of your insurance products, so it is more important than ever for us to work together to make sure that you are doing everything possible to get the best value from your insurance program.

Limits of Liability Insurance

The industry has noted an alarming rate of increase in judgment and settlement amounts over the last several years, even before we started to see consumer prices affected by the rate of inflation. Interestingly, some in the insurance industry were calling this, “Social Inflation” because there was no other fact or set of circumstances to account for these dramatic increases. 

You should review your limits of insurance to make sure that they are keeping up with the times. For example, if you have carried an Umbrella policy with a $1,000,000 limit for several years, it is probably time to increase that limit to $2,000,000. 

Higher Court Settlements

The insurance industry has noted a disturbing trend of much higher court judgments and settlements over the last several years. While this may not be related to economic inflation, the industry has been calling this trend a form of social inflation. 

We strongly urge our clients to consider their liability limits for both automobile and personal liability. A remarkably high percentage of our clients have Umbrella Liability policies that extend your liability limits above those on your home and auto policies. It may be time to purchase an Umbrella if you don’t already have one, or if you do, it may be time to increase your limits.

Increased Construction Costs

Another significant effect of high inflation is the skyrocketing costs of construction. This is critical for you because your property insurance for the home you live in or rent to others is based on the replacement cost rather than the market value. 

While we have seen some modulation in market values, we have seen little backtracking in construction costs. Most insurance companies try to keep pace with inflation by increasing the amount of your property insurance limits each year as the policy renews, but we have serious reservations that these increases have been enough to keep pace with the rate of inflation. The result of this is that you may find yourself a bit underinsured on your property coverage.

Your building, equipment, contents, and supplies are more expensive to rebuild or replace today than they were a year ago. Your insurance policy may have accelerators for some of those values, but that may not be adequate for the actual rate of inflation.  

We strongly recommend that you review your limits of property insurance and reach out to us to discuss increasing them to make sure that they are adequate.    

How Can We Help You?

At G. S. Newborn, we are committed to doing our best work to help you minimize your insurance premiums. Each year before your renewal, we search our markets to see if we can generate a better value for you. We do this proactively. For everyone. Every year. 

If we find a compelling differential – either in coverage or price, we contact you. Of course, we are happy to speak with you anytime to review your insurance program.

Talent Acquisition

Business pundits are saying that finding good employees is the number one problem facing business owners today. One way that you may be able to make your business more attractive to new employees is to spruce up your Employee Benefits offerings. We offer a full range of employee benefits – everything from health insurance to pension programs.  

Estimating Costs

We have some tools to help you estimate the replacement cost of your residential buildings.  Many of our carriers also have endorsements that pay you more than the amount shown on your policy. The bottom line is to contact us if you have concerns about your limits insurance.

Contact Us Today!

We want to be your trusted insurance advisor! Please feel free to call on us anytime – you do not have to wait until your policies are about to renew. 

Let’s make sure that your coverage is keeping pace, we are adjusting your program to your ever-changing business needs, and that we are up to date on any changes in your operations. Together we can get through this difficult cycle.

Business Insurance Registration Required in New Jersey

Until recently, there was no requirement under New Jersey (or Federal for that matter) law requiring a business owner to purchase Liability Insurance. This all changed when New Jersey Governor Murphy signed P.L. 2022, c.92 on August 5, 2022. Under this new state law, it is now illegal for any business or owner of a rental unit not to have liability insurance. The New Jersey law has left the implementation and enforcement of this new law to the local municipality.

Flemington Borough in Hunterdon County, New Jersey is one of the first municipalities to act on this new law. They have issued an ordinance which requires businesses and owners of rental units to register with the Borough, pay a $15 fee, and provide the Borough with proof of liability insurance.

The following entities must register and provide proof of insurance:

  • Businesses, which shall mean, any person intending to sell or dispose of or to offer to sell or
    dispose of any good, wares, merchandise or render any services for fees within the Borough.
  • Owners of single rental dwelling units
  • Owners of multiple dwelling rental units
  • Owners of multi-family homes that include rental units, even where one unit is owner-occupied

Flemington Borough is sending out notices to those properties affected. If you do not receive one, we
have copies for you.

How much insurance is required?

The New Jersey law now requires the owner of a business or a rental unit or units to carry liability insurance of no less than $500,000. The owner of a multi-family home which is four or fewer units, one of which is owner-occupied, is required to carry limits of no less than $300,000.

How to Provide Proof of Insurance?

While the Flemington registration form asks you to attach a copy of your liability policy, the State law requires you to file a Certificate of Insurance. We believe that in general, it is a bad idea to share your insurance policy with anyone other than your mortgage company. A Certificate of Insurance is a more concise and efficient way to share proof of your liability coverage without disclosing other personal information. For example, your insurance policy may include a schedule of valuable property, like jewelry or artwork that is specifically covered by your policy.

We are happy to issue a Certificate of Insurance for your business or property for the Borough of Flemington. Of course, there is no charge to you for this service. To order a certificate of insurance, please call our office or send a request to We will need to know the name of the business, the location address of the business or property in question (many of our clients have different mailing addresses than the location of their business or rental units).

If you are in a municipality other than Flemington Borough that enacts a registration requirement, please let us know and we will send you a Certificate of Insurance. We are here to help you manage your business and personal insurance program. Please contact us anytime if you have questions regarding the matters discussed in this article or on any aspect of your insurance plan.

What is an Additional Insured Endorsement

It seems an almost normal course of business these days to be asked to name a contractor, vendor, landlord, or other business associate as an additional insured on your liability insurance policies.  This article will delve into the details of the additional insured endorsement, how you do this, and the relative merits and risks of giving this status to your business associates.

Who is an Insured Under Your Policy?

Your basic liability policies define quite specifically who is insured under the policy.  The definitions are typically broader than you think but vary from policy to policy.  Typically, liability policies include coverage for the entity that is shown on the declarations page as the named insured.  If you operate under several different entities, all of them should probably be listed as a named insured.  For example, if you operate your business as a corporation where you are the sole or majority shareholder out of a building that is owned by a Limited Liability Company (LLC) in which you are the sole or majority owner, both the corporation and the LLC should be named in the declarations page as the insured.  You, as an individual are also covered by the definitions in the policy as respects your ownership of the entity.  It is also typical that corporate officers, and employees are also insureds under the policy in respects to their duties as such.  In an automobile liability policy, any driver of an insured vehicle is also an insured if they are driving the vehicle with permission.

It is customary but not necessary to have trade or fictitious names – sometimes called a doing business as name, listed as an insured on the declarations pages as well.  This would generally be descriptive in nature and not affect your coverage as long as the business name is fully owned by an entity that is named on the policy.  Getting the names on the declaration page correct, is the first step in making sure that your liability coverage is providing you what you need.

What is an "Additional Insured"?

Adding someone as an additional insured on your policy is the process of you sharing your coverage with that additional insured.  By sharing your coverage, you are diluting your limits of liability.  In other words, if you share your coverage, there is less coverage left for you.  The endorsement typically adds the additional insured to the list of entities who are insured under the policy.  Keep in mind that liability insurance is third-party coverage.  This means that the insureds are covered for allegations that through their negligence, they have caused injury (bodily injury or property damage) to another person or entity.

Why are You Being Asked to Name a Business Associate as an Additional Insured on Your Policy?

This is a technique of risk transfer where one party is obtaining protection through another for liabilities that arise, presumably through their business interactions.  It is customary for a landlord to require as a provision in a lease a tenant to indemnify, defend, and hold them harmless for liabilities that arise from the tenant’s occupancy of the premises.  In this case, the terminology, “indemnify and defend” could be stated as “name as additional insured on your insurance policy.”  Some leases contain both of those requirements.  It is also routine for a General Contractor to require additional insured status on the liability insurance policies of a Sub-Contractor.  I am not saying that these requirements are good or bad; they are just normal practices within those industries.  

How do You Add Additional Insured Coverage To Your Policies?

There are many different endorsements and techniques that do this, and we try and find the method that makes the most sense for each specific situation.  We can break the types of endorsements for adding additional insured status into two categories.

Blanket Endorsement

A blanket additional insured endorsement is quite common these days.  Under this method, your policy contains language that grants additional insured status to any party requiring such status under a written agreement.  The premium charge for this coverage is likely built into your policy and you do not pay for each party that is granted such status.  It is important to remember that there must be a written agreement between the two parties for the additional insured status to be in effect.  While this is a common method, there are problems with this technique and often insurance requirements in specific contracts and agreements cannot be satisfied with a blanket endorsement.

Specific Endorsement

This is an endorsement added to your liability policy that specifically names the additional insured and outlines the scope of coverage that applies to the additional insured.  Insurance companies may charge a premium for these endorsements each time they are added to your policy. There are many diverse types of additional insured endorsements with varying levels and degrees of coverage for the additional insured.  

Other Related Requirements

When you are required to name a business associate as an additional insured, it is common that you may also be asked for other coverages such as:

  • Primary and Non-Contributory: This is an endorsement that makes your policy primary over insurance that the additional insured may purchase for themselves.  
  • Waiver of Subrogation: This is an endorsement that prevents your insurance company from seeking recourse from the additional insured even if they are responsible for the loss.  
  • Cancellation Notice: Your policy provides legal requirements of notification if the insurance company is going to cancel or non-renew your policy.  This endorsement makes the insurance company for notifying the additional insured about a pending cancellation as well.  Keep in mind when you add this endorsement to your policy, your business associate will get a notification from the insurance company if your payment is late which leads to a pending notification of cancellation of coverage for non-payment.

We spend a significant amount of time each week reviewing the insurance provisions of agreements for our clients and advising them what is required to meet those requirements.  It works best if we review the agreement before you have completed negotiations on the project.  Our experience tells us that some of these agreements are not negotiable – but many are.  Helping you assess the risk you agree to assume through business agreements seems logical to be part of the service a competent insurance advisor provides.  We are happy to be that advisor for you.

man in office working on computer

Ten Tips for Proper Cyber Hygiene

I like lists. Lists help me stay organized and help me break big, overwhelming things into bite-size pieces I can get done.

One of the big, overwhelming things facing business owners these days is cybersecurity. You don’t have to be an IT person or software expert to gather that we are in perilous times when it comes to cybersecurity, data safety, and protecting your business information.

Just a few months ago, insurance companies were eager to “add on” cyber coverages to any policy for a minimal amount of additional premium, where now they want to underwrite this exposure (to make sure that you don’t really need it before they agree to sell it to you).

By the way, “not needing it” is where you want to be. Cyber insurance should be for a freak occurrence that you do not expect rather than a method to deal with sloppy or non-existent cyber standards and procedures.

Top Ten List for Proper Cyber Hygiene

I did some research and produced a Top Ten list for proper cyber hygiene. Hygiene is a great word to use for this because you need to have consistent standards and procedures that you incorporate into your operations to make sure that you have good cyber health and well-being.

If you have questions, or want to discuss your cyber hygiene, call us.

10. Install Antivirus and Malware Software

First, use a reputable company that is highly rated. Keep up with the expiration dates of your software programs and purchase a package that fits your business needs. If you schedule routine upgrades, do not skip them.

9. Keep Your Hard Drive Clean

Delete old and unused programs. Also, reformat your hard drive on a scheduled basis.

8. Use Network Firewalls

Firewalls can be an important method to prevent unauthorized users from accessing your website and other online data. Don’t cheap out when you install your firewalls.

7. Back Up All Systems Regularly

Back up your files and programs offline, to an external hard disk, or to the cloud. Do this on a schedule that fits your business operations. If you have a security breach, you can use your backup to create a “clean” data set to resume your operations. From a physical perils point of view, make sure that your external hard disk is stored or kept somewhere other than the same room as your server or computer.

6. Update Software Regularly

Make sure that all your programs have the most up-to-date versions, especially any security software that you use. You want to have the latest protections that are added to each program.

5. Use Multifactor Authentication Wherever Practical

This creates another layer of security and makes your data harder to access. A multifactor authentication procedure adds a second password or code to be entered to access a program or portal. You may even be able to add biometric devices to particularly sensitive programs or data.

4. Employ Device Encryption

Look into encryption of email, other communication programs, and how you connect to other devices such as laptops, and remote users.

3. Do Not Open Suspicious Emails, Links, or Attachments - Think Before You Click

More than any other cyber threat you may face, problems are caused by not thinking before you click. Hackers and cyber evildoers are constantly refining their techniques to get you to divulge sensitive data or unknowingly install malware on your computer. The best defense is never open suspicious email, attachments, or links. Constantly reinforce this to your employees and staff.

2. Use Strong Passwords and Change Passwords Frequently

It sounds so simple, but this is one of the easiest methods to protect your data. Have a schedule for changing your passwords and take the time to make them complex and difficult to guess. Do not use the same password all the time! There are systems you can install that do some of this for you, such as Password Manager from Google. Check with your IT consultant to see if any of these are a fit for your business.

1. Purchase Cybersecurity and Data Breach Insurance Coverage

Even with an excellent hygiene plan and dedicated implementation and monitoring, you may not be fully protected. Here, your fallback plan should be a strong insurance program. We’re here to help you evaluate your needs and find the right insurance to meet those needs. Contact us now!

care on fire being sprayed with water by firefighters

What To Do When You Have a Claim?

It is never fun to have an insurance claim. Even with the best insurance coverage and a responsive agent to help you (like us), you will face a certain degree of aggravation, inconvenience, and even emotional distress. Here are some helpful hints to help you organize your thoughts and minimize your stress should you experience an insurance claim.

Report All Claims to Your Agent as Soon as Possible

While all our insurance carriers have direct reporting capabilities and we list a claim contact for each carrier on our website, it may be best to report the claim to us.

Sometimes, you may have an incident or accident but decide that it does not merit making an insurance claim against your policy. For example, you may have damage that totals $1,400 and have a $1,000 deductible on your policy. This could be a situation where you decide not to involve your insurance carrier. We can discuss these situations with you at the time of the loss and give you the information you need to make such a decision.

When you report a claim directly to the insurance company, you cannot take back the claim.

If You Are Involved in an Automobile Accident – Call the Police

Please don’t get confused by the saying that New Jersey (or any other State for that matter) is a “no-fault” state. That terminology doesn’t mean what you think as it relates solely to responsibility to pay for medical care arising from an automobile accident.

It is important to determine who is at fault at the scene of an accident. The reporting police officer will take a statement from all parties involved and may make a conclusion on fault. This is often followed up with a ticket or citation given to the “at-fault” party. If you are in a two-car accident, and you are the only person who receives a ticket, it is a good bet that the police report will state that you were primarily responsible for the accident.

When you are at-fault, it is likely that your insurance policy will end up paying for the damage to the other party’s vehicle and your own if you have collision coverage.

Do Not Handle the Claim Yourself

It is important that you not do anything that impairs the ability of the insurance company to defend you in a suit. That is a condition of your policy and in an extreme situation could negate your liability coverage. In plain language, this means that you should not admit to fault, or offer to pay out of your pocket for damages to another party, especially if there is bodily injury involved.

Get as Much Information as You Can

Regardless of the claim, the more information you have, the better. For automobile accidents, it is important to get the following information:

  • Names of all the parties – Get as much contact information as you can, like telephone numbers, addresses, or email addresses.
  • Get contact information from any witnesses to the accident – The police officer may not do this.
  • The location of the accident – Either the intersecting streets, a street address, or GPS points are helpful. Know the name of the responding police department and try to get the officer’s name.
  • It is helpful to take a photo of the damage to all vehicles involved if you can. Where a car is damaged can help you recreate the flow of the accident when your head clears.

Remember to remove anything important from your vehicle if you are leaving it at the scene. My mother once totaled a vehicle, only to realize later that her purse, checkbook, and other personal items were still in the car after they towed it away.

Of course, if you are injured, worry about seeking treatment of the points listed above.

For home or other property claims, it is important to get the following information:

  • What is the cause of loss if you know it.
  • You need a date to report a claim, so try to remember when the damage occurred rather than when you noticed it.
  • Did anyone respond to the claim such as the fire department, police department, or others.
  • If you call a remediator or a contractor, it is important to get contact information so the insurance company can reach out to them as early as possible.

Please remember that we are here to help when you have a claim! Call us anytime.

a judge's gavel in courtroom

How Much Liability Insurance Is Enough?

Liability insurance is what you purchase to protect you, or your business entity, from the allegations of injury from a third party. Luckily, most of us have not had a worst-case scenario where we face financial ruin from the results of a mistake arising from our personal or business activities. But those worst-case situations happen. Let’s look at a few claim scenarios.

Examples Of Liability Claims

1. Underage Drinking

A high school senior attends a party at a close friend’s home intending to stay overnight. Alcohol is served at the party with the knowledge of the friend’s parents under the provisions that all those drinking will surrender their keys and sleep over. During the night, the senior wakes up, walks home, and sneaks out of the house. While walking along the highway, he is struck by a vehicle and gravely injured.

While the parents took what to them seemed reasonable precautions to protect their guests, the fact is that they provided or allowed underage children to drink in their home. They will have some responsibility under the law for the injuries to their child’s friend. How much insurance is enough if you are the friend's parents?

2. Contracting Mishap

A home improvement contractor gets a job to replace a deck for a client. The contractor purchases the lumber for the new deck from the normal supplier and purchases appropriately graded lumber for the specifications of the project. Several years after the job is completed and paid for, the deck collapses and twelve people are severely injured during a family celebration.

The home improvement contractor may have done everything correctly while building the deck, including following all township inspection requirements. However, if the lumber is found to have been defective, there is no doubt that the contractor, along with the supplier, and the manufacturer of the lumber will be held legally responsible for the injuries caused by the work that the contractor performed. How much insurance is enough if you are the home improvement contractor?

3. At Fault When Driving

The operator of a vehicle is driving on a typical crowded highway in New Jersey (this could be you, your child, or your employee driving one of your business vehicles), when the driver is distracted and does not see the line of traffic that is stopped on the highway. There are any number of events (occurrences, activities, or happenings) that you can fill in as the distraction, such as receiving a text message, spilling ketchup from the fast-food sandwich that is being consumed, or daydreaming.

Knowing that there is not enough room to stop the vehicle, the driver swerves into the right lane and then into the shoulder of the road, stopping without hitting or getting hit by another vehicle. However, the quick maneuvering causes a school bus that was in the right-hand lane to stop suddenly, causing several students to hit their heads on the seats in front of them. An ambulance takes several of these students away to receive treatment.

The owner of the vehicle whose driver cut off the school bus will have some responsibility for the injured students on the school bus. How much insurance is enough if you own the vehicle that ends up in the shoulder?

How Much Liability Insurance Would Be Necessary In These Claims?

In each of these claim scenarios, there is a high potential for civil litigation. So, the key question here is how much insurance would be enough?

While it is impossible to know in advance or to predict the outcome of these scenarios, there are a few things that we understand based on trends in our legal system.

Legal System Trends

Legal Defenses Are Expensive

The cost to defend these claims is much higher than you may think. For most liability insurance policies, the cost of defense is not part of the limit and is not subject to a dollar limitation. However, it is unrealistic to assume that an insurance company will spend more money to defend a case than it would cost them to settle it or to pay out the policy limit.

In other words, if your insurance limit is too low, you could encourage the insurance company to settle for total limits rather than defend you throughout the entire course of the claim. The insurance company does this through a “reservation of rights” notification which advises you that the case may exceed your limits and suggesting that you have your own legal representation (attorney).

Outcomes Are Unpredictable In Civil Court

Judgements in civil court have exploded over the last several years. The insurance industry trade press has dubbed this phenomenon “social insurance.” It has gotten so bad that many question the ability of the insurance industry and the legal profession to predict the outcome of civil litigation. Lack of predictability of these outcomes has been a heavy contributor to the increase in liability insurance costs over the last few years.

Are You A Target?

The legal system has built-in incentives for attorneys to seek judgements over insurance limits when the defendant in the suit has significant assets.

Guidelines To Help Determine Liability Insurance Coverage

There are several guidelines that you can use to help direct you in selecting an appropriate level of liability insurance coverage for you.

1. Consider Your Net Worth

If you have significant assets, you should have significant limits of insurance. This applies to business operations as well. If you own a building worth $3,000,000 with no mortgage and you have a liability insurance limit of $500,000, you may not have enough liability insurance.

2. Consider Your Conscience.

If a mistake of yours causes injury to another person, how would you feel if you do not have enough insurance to provide needed care to that person and their family.

3. Consider An Upgrade

If you have always carried a one-million-dollar limit, perhaps it is time to upgrade your limit simply because, over time, you need more.

4. Consider The Cost

You will be surprised how inexpensively you can increase your liability coverage.

Everyone's Liability Needs Are Unique

In summary, there is no magic formula to determine the limits of liability insurance that work for you.

We hope this article has helped put the need for higher limits in context for you. Please contact us to discuss your limit and to find out how easy it is to increase your level of protection.

man loading delivery van with boxes

Risk Management For Contractors and Business Owners

What Is Risk Management?

Risk Management is the process of dealing with potential loss by a business or operation. The scope of Risk Management goes beyond purchasing an insurance policy as there are many areas of loss that may not be addressed by any specific insurance policy.

The phases of the Risk Management Process typically include:

• Identifying exposures (possible losses)
• Measuring those exposures
• Developing a plan to mitigate, transfer, or fund the potential losses (an insurance policy is a funding method)
• Implementing the plan
• Reviewing the effectiveness of the plan and making any necessary adjustments

This is a never ending analysis that must be adjusted constantly to meet the pace of a dynamic business and the environment in which the business operates.

As your insurance agent, we can be an integral part of your risk management team. Along with your tax advisor, attorney, safety coordinator, and executives, we can help you review all aspects of risk for your business and help you coordinate an integrated Risk Management Plan.

Most contractors and small business owners do this intuitively every day as they measure their risk-versus-reward for every activity, project, bid, and job that comes up. We can help you formalize this process which can be a key factor to allow for the growth of the business.

A Good Way to Start Risk Management

If you are not ready to do a formal plan that includes all the steps in the risk management process, phase in a plan by focusing on the largest categories of risk that most businesses face. We can divide your largest exposures to loss in the following categories:


Your business may own various types of property. How would a significant loss to your business property affect the future viability of your business?

• Buildings
• Personal property in your building or elsewhere
• Tools and equipment that may be at your premises, in transit, or at a job site
• Property in your care or custody that is owned by others
• Property in transit – Are you shipping goods to or from your premise? How are they shipped and who is responsible for that property?
• Loss of use of property – Both buildings and other property (In these days of supply flow concern this may be a much larger factor to your business operations than in the past.)

Human Loss

Your key employees may be the unique advantage that makes your company successful. Yet we spend very little time thinking about them as a critical piece of the business and protecting the business from the various losses that can happen to our “human assets”.

• Losing a Key Employee by sickness, death, retirement, or to the competition – Do we have a plan to help the company survive each of these possibilities?
• Business Perpetuation and Continuity – What happens to the business if one partner/owner gets sick, becomes disabled, or dies?
• Employee Care – Do you have an employee benefits plan that is valuable to the employee? What other employee retention program is in place?


What risk do you face from injuries to others?

• Bodily Injury – To employees, contractors, bystanders, or those who use your products or services. Can you mitigate this risk?
• Property Damage – What potential risk to property do your operations face? Don’t forget operations of automobiles, trucks, and equipment which may by your single largest exposure to a catastrophic liability loss.
• By Contract - Each day you may sign agreements under which you assume liability. Are you reviewing these agreements to make sure that loss is acceptable or at least covered by your insurance? (We can help you with this.)


Think beyond “environmental” to the full scope of the social and business environment in which you operate.

• Social Risk – Are you keeping pace with important changes in society that could increase your exposure to loss? This goes beyond “political correctness” and is a growing threat to all business owners.
• Regulatory Risk – Do you take part in industry associations to keep up to date on potential threats to your business or industry from regulations or laws that may threaten your ability to do business as currently made up? Are you current with all regulations and statutes?
• Competitive Risk – Are you paying attention to changes in society that could affect your business? What (or who) are the business disruptors in your industry?

G. S. Newborn & Associates Can Help

We have experience working with business owners in developing a Risk Management program. We can coordinate with your other advisors to do a full risk analysis for your company, or we can focus on whichever area of the process you feel will most positively affect your business.

For many of our clients, we perform the following services, which are steps in mitigating risk and part of a good Risk Management Program for any business:

Contract Review

We are always available to review a contract or agreement to give you an analysis of how the agreement fits with your insurance program. From a lease agreement to a proposal contract, we will let you know what liabilities you may assume under the agreement and how your insurance policy matches the insurance provisions and requirements of the agreement.

Subcontractor Agreements & Certificate of Insurance Program

If you use subcontractors, you should have an agreement where you transfer reasonable risk and liabilities to the subcontractor working on your behalf. You also must require them to have adequate insurance. We can help you develop these agreements & requirements and administer them to you so you know all subcontractors are meeting your requirements.

Employee Benefits Review

Having a meaningful employee benefits plan is not only critical in terms of expense, but it can be a centerpiece in your employee retention program as well. Not all plans are equal, and in your quest to manage expenses, you may cause increased employee turnover and dissatisfaction.

Let our experienced benefit advisor help you develop an employee benefits plan that maximizes your expenditures so you get the most bang for your buck from your employee benefits.


We can customize programs that are unique to your business or industry. We think outside of the box to find the best way to protect your business.

What Do These Services Cost?

We provide the above services to our clients with no additional charge. We think an informed client is a better client!

Can you afford not to have a Risk Management Plan? Let’s talk…

- Gary S. Newborn

A young couple with their daughter at home

Personal Lines of Insurance: A Complete Guide (Updated 9/4/21)

Buying insurance for your home, automobile, motorcycle, boat or other personal assets seems like one of those routine, necessary things that everyone must do but no one wants to do.  You are bombarded with messaging telling you that it is all about the price, the convenience, the time and the name.

No one is telling you that the difference between a policy that meets your needs and one that misses the mark is in the coverage details and how you choose to make the policy fit your needs.  In this article, we’ll discuss the common “personal lines of insurance and give you straightforward and realistic information to help you buy the right insurance for you.

Homeowners Insurance

Your home is likely the largest purchase you will ever make.  There is a broad range of coverage available out there today with tremendous variation in coverage, each one being sold under the same label as a Homeowners Insurance Policy.

To add to the confusion, there are different types of Homeowners Policies for different types of ownership situations.  The chart below illustrates the various types of Homeowners Policy forms.

Form Known As Used For
HO-3, HO-5 Homeowners Policy Fee simple ownership (you own the land and the dwelling). Must be owner occupied.  May be one or two family structure.
HO-4 Homeowners Policy

Tenant Homeowner

Rental Policy

Tenant in an apartment, house, room, or condominium that they do not own.
HO-6 Homeowners Policy

Condo Unit Owners

Those who reside in a condominium unit that they also own. In some cases, this form may be used for an owner of a condominium that is occupied by a tenant.

Moreover, there are many versions of each form, some standardized and some carrier specific.  It is very difficult to determine if the policy being sold to you as a “Homeowners” Insurance Policy meets your needs or not unless you delve into the specific coverages in more detail.  For purposes of this article, we will focus on the HO-3 and HO-5 forms for fee simple ownership.

Keep in mind that the Homeowners Policy is built to serve the average homeowner.  An average policy probably has too much coverage for half of the people and too little for the other half.  Let’s break down what coverage is included in the Homeowners Policy.

Coverage on the dwelling is typically stated on the declarations page.  Most insurance companies will increase this limit each year to keep up with inflation in building materials and costs. One of the most important issues in designing a Homeowners Policy is to determine the correct limit to carry on the dwelling.

This section of the policy covers the actual building and all the items attached to the building such as electric wiring and fixtures, pipes, fixtures, flooring and more.  It is most often insured on a Replacement Cost basis – which means that the insurance is intended to pay for the cost to replace the damaged property or item with no penalty for the physical depreciation of that property.

It is important to remember that replacement cost has little or no relationship with the market or sales value of the property.

What Is Replacement Cost?

Replacement Cost coverage does not mean what most people think.  This is a form of settlement that is outlined in your insurance contract.  In its simplest form, Replacement Cost means you get “new” for “old”.  To be more technical, it is a payment without a penalty for physical depreciation.

Most insurance contracts, including homeowners policies, include an insurance to value clause that forces you to insure for some percentage of the actual replacement value of the structure in order to receive full benefits from the insurance policy at the time of a loss.  For most homeowners policies, the important threshold is 80%.  So, if you do not insure for at least 80% of the replacement value your loss will have a depreciation factor applied.

Let’s review an example of how this works.  Say that you have a home that is about 3,000 square feet in area.  Based on the type of construction, your State and county, the age of the house and other physical characteristics we calculate that the full replacement cost of the house is $750,000 (or $250 per square foot).

However, your homeowners policy shows a limit of coverage for the home of $550,000.  In a strong gust of wind during a rainstorm, your 20-year-old roof is damaged and must be replaced.  The estimate you receive to replace your damaged roof is $10,000.  If you insured the house for at least 80% of replacement cost, your loss settlement would be at replacement cost and you will receive $10,000 less your deductible.

Because you did not insure for at least 80% (which would have been $600,000), your loss settlement is at a depreciated value (we call this ACV or actual cash value).  A 20-year-old roof is probably through two-thirds of its expected life (if your roof has 30-year rated shingles), so the loss settlement will be $10,000 less two-thirds, or $3,300 less your deductible.  Imagine the effect on this if you have a partial fire loss of $100,000 or more.

It is important to carefully consider the amount of insurance that you purchase.  Keep in mind that when it comes to insurance, you are dealing with construction costs and not market value.  Market values tend to fluctuate and can go up and down depending on the economy and many other factors.

Construction costs generally trend upward based on inflation, but they rarely ever go down.  It is not unusual in these times to see a home where the construction or replacement values is much higher than the market value.  We also remember times when the opposite was true, and you could insure a home for much less than the purchase price.

Questions on Replacement Cost & How to Pick the Limit on Your Homeowners Insurance

Most “on-line” quotes you receive will be for a HO-3 Form.  We prefer to use a HO-5 form whenever possible.  The HO-3 form includes Special Perils for the Building and Broad Perils for Personal Property (contents).  Special perils are better, and the slight price difference is usually worth it!

If you spill fingernail polish on your hardwood floors, your sofa and on your expensive oriental rug is it covered?  Under a HO-3 form only the hardwood floors are covered.  If you purchase a HO-5 form, all those items are covered.

Deductibles: Watch Out For The Hidden Ones!

It is normal to have a deductible of $1,000 or higher for property losses on your Homeowners Policy.  There are some excellent points to consider even higher deductibles.  We do caution you for two types of deductibles that you may not even know that you have (and you may have to dig down to the very fine print on the on-line quote you received).

Hurricane Deductible.  This is a higher deductible that applies only to damage done because of a named storm or hurricane.  Often these deductibles are 2 - 5 percent of the coverage limit on the dwelling or higher.  If your home is insured with a limit of $700,000 on the dwelling, that could be a deductible as high as $35,000.  Some carriers place hurricane deductibles on all New Jersey and most Pennsylvania policies regardless of proximity to the coast.

Age of Roof Penalty.  While not listed as a deductible, some carriers are sneaking into their quotes a limitation on replacement cost coverage for older roofs.  In this case, you receive a depreciated value rather than the replacement value for the damage.  For example, if you have a roof that is 30 years old with 40 year rated shingles, you may only collect 25% of the cost of the new roof because of depreciation.  This acts like a 75% deductible on your roof.  You would certainly want to be aware of this limitation in advance.

Jewelry & Other Special Items

Most Homeowners Policies have limitations for loss by theft on jewelry and other valuable items such as silver, gold, silverware, guns, stamps, coins and money.  There are different ways to increase the limits of these items either by adding specific coverage for each item or by adding to the overall limit of coverage on the type of item.

We suggest that you consider adding a special coverage endorsement (sometimes called a rider) on these items to get both full value for the item and broader causes of loss.

More Info On Jewelry & Special Items Coverage, Plus Why A Rider Makes Sense

There are certain categories of property that are limited in your homeowners policy. Some types of property are limited to a dollar amount for all perils while others may be limited to a dollar limit for only theft.

For example, there is no limitation for jewelry for the peril of fire, but you may only have $2,500 of coverage for the peril of theft. All policies are different, so make sure to read yours to review these limits, but here is a chart that may be useful to identify the kinds of property that are generally limited.

Property (limited for all perils) - Money, bank notes, bullion, gold, accounts, deeds, letters of credit, passports, tickets, stamps, watercraft, trailers, property used for business purposes, electronic apparatus and accessories while in or upon a motor vehicle.

Property (limited for theft) - jewelry, watches, furs, precious stones, firearms, silverware, goldware, platinumware, pewterware, and gold, silver, platinum, or pewter plated items.

Why Purchase A Rider?

You may add coverage for all the items listed above on an endorsement we often call a “rider” or “floater”. There are many advantages to do this. You may expand the coverage – the actual perils that are covered for that property. A rider is usually an economical way to get the higher limits of coverage that you need on a cherished item.

In addition to the items listed above, it may be advisable to consider special coverage for collectibles, glassware, antiques, fine arts, paintings, musical instruments taken off the premises and sporting equipment. In general, think about any personal property that has a high value, special meaning or you cannot replace and consider a customized coverage solution.

For more in-depth information on property that may need special coverage, look at our blog post on the subject.

Coverage For Your Finished Basement

You will find huge variations in the coverage offered by different insurance companies for Water Back Up Coverage.  This is a very important coverage if you have a finished or partially finished basement.  We routinely see policies that exclude this coverage.

Most policies will allow you to purchase some limit of coverage for this – a typical limit may be $10,000.  We have options as low as $5,000 of coverage up to an unlimited amount (subject to the building coverage limit).  This is an area where it is important to make sure the policy fits your needs.

There are many other important coverages that are not often included in the quote you may receive when you are offered a cookie cutter solution for your home insurance needs.  We think these are some of the very important ones.

Service Line Coverage

This is a special coverage to cover damage to underground utilities and appliances for which the homeowner is responsible. This is a relatively new coverage that has become available.

Items targeted by this coverage are water, sewer, and electric lines that may run under your property to the municipally owned connection point. We have had many cases where an insured is reimbursed for thousands of dollars of damage to such an underground line.

Equipment Breakdown

Equipment Breakdown coverage fills a gap that is not otherwise covered by property insurance. This contemplates the breakdown of mechanical or digital systems that may be subject to unusual losses.

Some examples of this would include electrical arching, explosion or tearing asunder of a pressure vessel (boiler, hot water heater, etc.), or breakdown of an air conditioning compressor. This coverage is not a product warranty and generally does not coverage normal wear and tear or aging.

Flood Coverage

Flood is a peril that is excluded from homeowners and other forms of property insurance. There is a federally backed system of flood insurance available in the United States which you may purchase through our agency. The cost of flood insurance varies greatly depending on the location of the property.

There is a federal program of flood zone mapping that largely determines the cost of flood insurance and may determine if a flood insurance policy is required by your mortgage company. We have strong relationships with flood insurance programs for federal coverage, private carrier coverage and excess flood coverage.

It is important to note that each year there are millions of dollars of flood damage to homes not in a flood zone. We suggest that you review the benefits of a flood insurance policy regardless of the requirements of your mortgage company.

Earthquake and Earth Movement Coverage

Earthquake and earth movement are excluded causes of loss in the typical homeowners policy. Depending on the location of your home, we may be able to add this coverage for an additional premium to your policy.

Did you know that New Jersey is near a major fault line?

Sinkhole Collapse Coverage

Sinkholes are another excluded cause of loss from the homeowners policy. The issues of sinkholes are usually a geographic concern as they seem to be more prevalent in some areas of the country than others.

There have been instances of isolated sinkhole issues which have generally been traced to mining operations and abandoned mine shafts nearby. If you live on Coppermine Road, or Mine Street – you may want to think about adding this coverage to your policy.

The Homeowners Policy Also Provides Very Broad Personal Liability Coverage

The Liability coverage does what you think it does – protects you if someone gets hurt or injured on your property.  But it also provides protection if you cause bodily injury or property damage away from the premises during your personal (not business) activities.

For example, if your child is playing golf and accidentally hits another golfer causing some injuries that result in needed medical attention, loss of work, and ongoing treatment – the Homeowners Policy provides coverage (defense and settlement/judgement up to your liability limits).

Make Your Liability Coverage Fit For You

We think it is important to make sure that your Liability coverage includes some extra coverage that you can add to your policy – you’ll be surprised at the low cost of these enhanced coverages.

Personal Injury Liability

Personal Injury liability extends your liability coverage beyond Bodily Injury and Property Damage. Typically included in Personal Injury coverage is slander, libel, false arrest, and wrongful eviction. Often, this coverage is included for first dollar protection on a personal umbrella policy.

We think that in our litigious society, it is important to add Personal Injury Liability to your coverage program either through your homeowners policy or a personal umbrella policy.

Incidental Farm Liability

The typical homeowners policy excludes liability coverage from any and all business operations. Farming, even if not for a profit, is considered a business operation. Therefore, it is critical to make sure that your homeowners policy includes liability for farming if you have any farming exposure.

Farming exposure would include any or all the following:

  • You get a farmland tax exemption from your municipality or township
  • You raise, breed, or board any animals
  • You grow, raise, or sell crops, hay, eggs, fruit, vegetables, animals, or any other farm product to others
  • You lease land to others for farming purposes
  • Ownership of tractors or other equipment for farm use
  • Anything else that looks like farming

Not all insurance carriers will add this specialized liability coverage to a homeowners policy and many small farms may need another form of insurance called a Farmowners Policy for adequate coverage.

We have more than 30 years of experience in agricultural insurance. Call us if you are not sure if you need farming liability coverage.

Short-Term Rental Liability Coverage

If you are using any portion of your home or your premise for short-term rental (such as Airbnb, or VRBO) you may not have liability coverage for this portion of your exposure. Some of the rental platforms may include limited coverage for the property owner but we urge you to consult your attorney to gauge the adequacy of any coverage provided.

Some insurance carriers will endorse your policy for an additional premium to pick up this liability exposure.

Personal Automobile Insurance Policy (PAP)

It is no secret that New Jersey ranks quite high in the nation for the cost of personal automobile insurance. We spend a lot of time working with and for our clients to make sure that they have the best possible deal for their automobile insurance. But it is worth a few minutes to consider the coverage represented by this significant expenditure. We are outlining the major sections of the Personal Automobile Insurance policy with some special emphasis on important coverage details.

Liability Coverage

Liability insurance is mandatory for all registered automobiles in New Jersey. We call liability insurance a “third party” coverage in that you are purchasing insurance that ultimately pays benefit to a party other than you, the person who purchases the policy. There are two major categories of injuries that we are concerned with in automobile liability insurance, and they are bodily injury and property damage.

Bodily injury is the responsibility that you have if your negligence in an automobile results in injury to another person or persons. Property Damage relates to your responsibility for another’s property arising from an automobile accident.

A very important consideration in liability insurance is the cost to defend yourself from allegations of negligence. You may get sued for bodily injury or property damage, even if you are not responsible for the damages. We call this “Defense Costs”, and it is included in the Personal Automobile Insurance policy with no dollar limitation. It's also outside of your selected limits of coverage.

Limits for liability on a Personal Automobile Insurance Policy may be written on either a single limit or a split limit basis. A single limit includes damages for all bodily injuries and property damage within the limit. Split limits separate the coverage into a limit for bodily injury to any one person, a limit for bodily injury for all people injured in the accident, and a limit for property damage.

What Limit Should You Purchase?

The minimum limits for liability in New Jersey as mandated by State Law are $35,000 on a single limit basis and $15,000/$30,000/$5,000 on a split limit basis. We believe that these minimum limits are probably much too low for most established adults or families.

Here’s an exercise to help you understand the consequences of low limits. The next time you stop at a red light, estimate the value of the car in front of you, the car behind you, and the car next to you. This gives you a concept of what sort of limit you may need for just property damage.

Our recommendation is to purchase a limit that is enough to qualify you to purchase a Personal Umbrella Policy. That would give you a limit of at least $1,000,000 plus your personal automobile limits. Typically, you need to purchase a liability limit of $300,000 (single limit) or $250,000/$500,000/$100,000 (split limits).

Automobile owners with little or no personal assets should also consider limits more than State required minimums because it is possible for a judgement over your automobile insurance limits to be paid over a twenty-year period from future earnings.

We have seen young drivers have wages garnished to satisfy a judgement that came in higher than their insurance limit. In other words, having a low limit does not excuse you from meeting the standard of responsibility for damages that is established by a court.

An example of this would be if a driver, who is just starting a first job after college, rear ends a vehicle when approaching a traffic light. If that vehicle happens to be a new Mercedes Benz and the driver has State minimum split limits, the insurance company is only responsible to pay up to $5,000 for damages to the Mercedes. The driver may be responsible for paying the balance even if they have no assets to speak of. If the damages to the Mercedes are $30,000, the driver faces the prospects of starting a first job now being $25,000 in debt. That doesn't even include any college loans, etc.

Uninsured Motorist Coverage

This is another mandated coverage in New Jersey and most other States. Uninsured Motorist is a coverage that steps in when you are hit by an uninsured vehicle. Your damages are then paid by your policy which fills in when the responsible party has no insurance.

There are a high percentage of uninsured vehicles on the road in most highly populated regions in our country. We recommend you match your Uninsured Motorist Coverage to the same limits that you purchase for Liability.

In NJ, our Uninsured Motorist Coverage also includes what we call Underinsured Motorist Coverage as well. This provides coverage when the party that hits you has lower limits than you and your policy serves to fill that gap.

Personal Injury Protection

New Jersey is called a “No-Fault State”. That simply means that if you are involved in an automobile accident, your medical coverage is provided by your automobile insurance coverage regardless of who is at fault.

There are two ways to purchase Personal Injury Protection (PIP) coverage in New Jersey.

You may purchase this with a Lawsuit Limitation, which is the most common way to purchase the coverage. When you do this, you are agreeing to waive your rights to sue the other party to collect your benefits. There are thresholds that, if met, allow you to bring suit even when you select this more restricted coverage.

The other way to purchase this coverage is with No Lawsuit Limitation, which gives you the right to collect benefits and sue the other party with no restrictions. This is a more expensive option.

There are many more options regarding the benefits under PIP which are outlined in your Buyers Guide, which you receive with your insurance policy each year. We are happy to review all these options for you. A more detailed description of PIP will be provided in a future article.

Physical Coverage Damage – Coverage For Your Scheduled Vehicles

This is an optional coverage from the State’s perspective. If you have a loan on your vehicle, the lender will certainly require you to have both Comprehensive and Collision coverage. This is a “first party” coverage since the insured is the one who receives the benefit or payment from the policy in the event of a loss.

There are several types of Physical Damage Coverage.

Comprehensive Coverage

Comprehensive Coverage is a very broad coverage for damage to the vehicle arising from an accident that includes pretty much everything other than a Collision. The way the policy is written, this coverage includes everything unless they specifically excluded it in the policy.

The major perils that fall under Comprehensive include theft, fire, vandalism, hitting an animal, and glass damage. You purchase this coverage with a deductible.

Collision Coverage

Collision Coverage is for damage resulting from a collision (hitting another vehicle or object) or upset or overturn. This coverage is purchased with a deductible.

Both Comprehensive and Collision coverage are settled based on the vehicle’s Actual Cash Value or book value. The important thing to understand is that it incorporates the depreciation in value over time for the vehicle.

Towing Coverage

This is typically available if you purchase Comprehensive coverage. Towing coverage provides coverage for towing or roadside labor you need for the vehicle because of mechanical breakdown or other causes. Typically, you do not need to be involved in an accident for this coverage to apply.

Rental Coverage

Rental Coverage is extra coverage that you purchase to pay for the use of a rental vehicle to replace your covered automobile if it is damaged in an accident. You may select the limits for this coverage, and we suggest you review current daily rental rates in your area when you choose this limit.

Other important Physical Damage coverages usually added to your policy with an endorsement include:

Stated Amount Coverage

This is an endorsement that some insurance carriers add to your policy. But remember, it is not a coverage. It is a limitation!

Normally, for physical damage, the policy pays you the lesser of the cost to repair or the Actual Cash Value (book value). When you have a Stated Amount Endorsement, you get whichever is less between the dollar limit on the State Amount Endorsement, the cost to repair, or the Actual Cash Value.

We find that often when this endorsement is used, the limit shown on the endorsement is less than the projected book value of the vehicle. We rarely recommend the use of this endorsement.

Replacement Cost Coverage

Some insurance companies offer a replacement cost endorsement for certain vehicles. Generally, these vehicles need to be newer and in good condition. This endorsement eliminates the depreciation factor from the loss settlement. Under this endorsement, you get new for old. Contact us if you are interested in this coverage.

Gap Coverage

We have spent some time describing the effect of depreciation on the loss settlement on a vehicle. It is quite possible to owe more for a car loan than the car is worth on an Actual Cost Value (depreciated basis).

We call the difference between what you may owe on a vehicle and what the vehicle is worth the “gap”. Many of our insurance companies offer this coverage as an endorsement to the policy. This gap coverage can apply to either a loan or a lease. Keep in mind, when you negotiate the purchase or lease of a new vehicle, you can often get the finance company to include Gap Coverage for no additional cost.

Purchasing The Right Auto Insurance Coverage Is Important

While your home may be the largest investment you make in your life, driving an automobile may be the most hazardous activity that you do. Most of our lifestyles are driving-centric and our cars are literally our home away from home.

We believe that you should pay close attention to the coverage you have on your policy and carefully consider your limits. For a small extra premium, you can more adequately protect yourself from the threat of financial ruin arising from an activity that most of us take totally for granted.

two people running through files together

Surviving Your Workers Compensation Audit

If Benjamin Franklin were around today, he might change his famous quote to, “In this world, nothing is certain but death, taxes, and a workers compensation audit.”

Why Is Your Policy Audited?

The premium for workers compensation insurance is based on the payroll to employees and the cost of uninsured contractors during the policy period. At the beginning of the policy term, your policy is set up based on a projection of your payroll. It makes sense that at the end of the policy term, an adjustment will then be made. It'll be either up or down based on your actual payroll.

Another way to think of this is that payroll is the unit that the insurance mechanism uses to measure your exposure to loss in workers compensation insurance. A payroll audit must be done to make sure that your small business does not pay the same premium that a much larger company would pay.

What Information Is Required?

The insurance company will ask you to produce certain documentation so that your payroll levels and cost of sub-contractors can be validated. Here is a list of the most common items that you will be asked to produce.

  • A payroll report (from your payroll service, if possible) showing a summary of gross wages by employee for the policy period. The summary should include regular time wages and overtime wages.
  • Copies of your Federal payroll tax filings—941 Forms and your State payroll tax filings—and WR 30 Forms that correspond to the quarters that encompass most of your policy period. Don’t worry if your policy dates do not match the quarters perfectly as that is normally the case.
  • The insurance company will typically ask for evidence of your gross sales for the policy period. You can provide this with a balance sheet/profit-and-loss statement that matches the policy period (if you can generate this internally). If you cannot do a policy period statement, do the closest year end statement that you can. While your gross sales are not used in determining your premium for workers compensation, they will ask for this as a check on the overall size of your business.
  • Statement of sub-contractors used during the policy period. The best way to do this is to track these expenses during the year in your accounting system and to print a report that shows each sub-contractor and the checks written to them during the policy period. The entry should show a date of the check and the amount of the check. If you cannot show a report for the use of sub-contractors, the insurance company will ask to see your general ledger or your checkbook. They'll then search for all expenditures to sub-contractors during the policy term.
  • Copies of Certificate of Insurance for each sub-contractor shown on your sub-contractor report.
  • Copies of your 1099 report for the most current year end.

Sub-Contractors and Workers Comp

An insured sub-contractor does not add any premium to your workers compensation policy. However, an uninsured sub-contractor will generate a charge just as if it was payroll. This is a double penalty because your cost of sub-contractors includes labor and materials.

It is very important that you collect insurance certificates from all sub-contractors. We recommend that you have a written agreement with all sub-contractors to outline the coverage that is required, as well as including indemnification, hold harmless, and additional insured requirements.

G.S. Newborn & Associates, Inc. Adds Value To Your Insurance Program

We can help you institute a certificate management and a sub-contractor agreement program, and are happy to help you administer this program. You should never have to pay a premium for an uninsured sub-contractor! We include this service for our commercial clients at no charge to you.

Do Your Audit Promptly

The insurance company is not going to chase you to do your workers compensation audit. Under a new regulation in New Jersey, an unaccomplished audit results in an estimated audit with a much higher premium level than your projection. So, if you do not complete your audit in a timely manner, you will receive a large additional premium audit invoice based on an arbitrary payroll level increase.

We urge you to respond right away to an audit request. If you cannot reach the auditor, please contact our office and we can intercede for you.

After The Audit

Once the audit is complete, you will receive an audit endorsement to the expired policy. There are three possible results: no change, additional premium, or return premium.

If you owe additional premium, the insurance company will send you an invoice for that premium. Keep in mind that this premium will be billed in one installment. Most of our carriers will agree to spread out this premium over two or three months depending on the size of the audit premium. You just need to contact us to arrange this for you.

If they owe you a return premium, you will receive a credit or check for this amount from the carrier.

When your audited payroll levels were much higher than your projected payroll, you will obviously have an audit premium due. Most insurance companies will also adjust the payroll levels on your current policy, which has already been issued, which will generate an additional premium invoice as well. This is a bit of a double hit so we suggest you try to make your payroll projection for your policy as accurate as possible since understating your payroll can do a number on your cash flow.

G.S. Newborn Is Here To Help

We are available to help you with all phases of this process. Please contact us if you have any questions about your workers compensation audit or any aspect of your insurance program.

first person closeup view of handshake

How, And From Whom, You Buy Your Insurance Matters

We are inundated each day with branding, messaging, and advertising. With the advances in technology and social media, it seems to be everywhere all at the same time. And it works.

We cannot help but be influenced by a catchy jingle, a compelling story, or the assault of repetition of a message that we hear dozens and dozens of times each day. But with insurance, the story that you are hearing, the messages that you are receiving, and the brands that come to mind may not be telling you the entire story.

You should note that I am not objective in this matter. I am an independent insurance agent with almost forty years of experience–so I have a definite point of view. I ask that you read further to hear me out–my budget for social media, branding, and advertising is virtually non-existent, so this is my only way to tell our side of the story.

What Is An Insurance Agent?

In basic terms, an insurance agent is any person who is licensed to review, discuss, and effect insurance coverage in each State (yes, insurance is regulated by the States). In practice, even though all agents are licensed with the State in the same manner, there are a variety of types of insurance agents.

Captive Agent

A captive agent is a licensed insurance agent who represents a single insurance carrier. These agents are typically the sales arm of the insurance company. Mostly, these agents may only sell you products from their “captive” insurance carrier.

Direct Agent

A direct agent is a licensed insurance agent who is an employee of an insurance carrier. These agents, much like the captive agents mentioned above, are generally the sales arm of the insurance company for whom they work and limited to offering you products from only their employer insurance company.

Online Representative

An online representative is someone working for an insurance provider, typically an insurance company, but perhaps a technology or other company involved in the distribution of insurance products who walks you through an automated process to purchase insurance coverage. They may license these representatives in your State, or they may work “under” a licensed insurance agent. They typically offer products and services from a single insurance company.

Independent Agent

An independent agent is a licensed insurance agent who represents multiple insurance carriers because of appointments (contracts) that are entered with each carrier that outline the specific duties and responsibilities of the agent and the insurance company.

These agents may offer you a range of products from all the insurance companies with whom they are contracted. The Agency often consists of many licensed insurance agents who work together to provide ongoing service to their clients.

Over my career in insurance, I have met competent and professional practitioners of insurance from each category and type of insurance agent. Each consumer will make their selection of how they wish to purchase insurance based on their own needs and goals from the process.

A Real Life Case Of How Purchasing Insurance Matters

We recently worked with a homeowner who was being cancelled by their insurance company because of too many claims during a five-year period.

In NJ, each insurance company files guidelines for eligibility (with the State) that they must follow. All of them include a specific number of claims over a period that allows them to terminate insurance coverage. It is typical for carriers to have a guideline of three claims over either three or five years as the tipping point.

In this case, the homeowner had three claims over a five-year period. One claim was from wind damage and the insurance company paid out $1,200. The second claim was reported by the homeowner for water that seeped into their basement during a period of heavy rainfall. This claim was declined by the insurance carrier because this type of loss is typically not covered by a homeowner policy. The third claim was for storm damage and the insurance company paid out over $40,000 for the damage. The third claim during the period for that insurance company generated a non-renewal notice, and this homeowner needed to find new insurance coverage.

There are many points we can gather from this real-life situation.

  1. The second claim perhaps should not have been reported. A competent agent would know that this is not covered. Many carriers will count every claim inquiry, including declined claims, as a reported claim. By the way, the homeowner told us that there was no damage to either the building or to their personal property. They were just wondering if their policy would pay for waterproofing to repair this condition to their home so that there would not be damage in the future.
  2. This homeowner reported the claim directly to the insurance company because their agent (in this case a captive agent) directed them to the insurance carrier’s website for claims. Sometimes direct reporting may not be optimal for the best results. As an independent agent, we believe that helping our clients at claim time is a primary duty and responsibility. It gives us an opportunity to explain how the claims process works to our client. It gives the client an opportunity to explain exactly what happened to an advocate rather than a report taker. It also gives us the chance to explain the consequences of the claim and what that claim may do to their ability to purchase insurance in the future or to their cost of insurance.
  3. Here, the homeowner had a policy with a very low deductible. We generally recommend a range of deductible limits to our clients with the express purpose to help them avoid tiny claims which may cause them to be cancelled in the future if they have larger, more substantial claims. Here, if the homeowner had a deductible of $1,000, they may not have wanted to report a claim that would only pay them $200.

By the end of our conversation, the homeowner appreciated our point of view and asked if we were able to obtain a policy for them. We knew that all our insurance carriers would decline this account because they had been non-renewed for claims activity, but we contacted one of our insurance company underwriters, explained the second claim that should never have been a claim, and that carrier agreed to offer a policy for the homeowner.

This new client has expressed to us that they wish they had worked with an agent on a “consultative” basis before they had to learn the hard way that it matters how (and from whom) you purchase your insurance.

Key Insurance Buying Takeaways

  • Work with an agent who is going to ask you a lot of questions and work with you to design an insurance policy that works for you.
  • Expect ongoing service from the person who understands your account and knows your needs for claims, payment issues, new and improved coverage, and alternative competitive quotes for your coverage.
  • The convenience of websites and toll-free telephone numbers for service is lovely but may not always get you the best advice.
  • Work with an agent that you trust and who will tell you what you need to hear, which may not always be what you want to hear.

We think that being an independent insurance agent puts us in the best position to help you get the most from your insurance program.

older couple on swing

Navigating the World of Medicare

Written By: Jacob Bobick, Account Executive

Few topics garner as much attention for new (or experienced) retirees as the federal Medicare program. When I got my start in the financial services world over 20 years ago, my firm specialized in helping people transition into their “non-working” years. We set up pensions, rolled 401(k)s, managed IRAs, that type of thing.

The number one question I got, without fail, was: “what am I going to do about my health insurance?” I realized early on that I had better learn the ins and outs of Medicare to help my clients figure this out!

A New Generation of Retirees and Insurance

It used to be common for a retiree to secure lifelong healthcare benefits for themself, their spouse, and their dependents upon retirement - often after decades of diligent service. Few careers or companies offer that type of retirement package these days. There are several reasons for this, but the most common one is simple: expense.

We have all seen the skyrocketing costs of healthcare, and simply put, employers are no longer interested in footing this bill. That leaves retirees looking at $1,000 or more every month in health insurance premiums. A husband and wife can easily be over $2,000/month just to cover the two of them. Enter, Medicare.

Happy 65th Birthday!

It is a funny thing about birthdays… we all look forward to them every year, as it is our special day. But what we do not look forward to is that number climbing as we get older! I can remember as a kid being excited about my 16th birthday so I could get my driver’s license, then turning 18 so I could stay out a little later, and of course many look forward to turning 21 for obvious reasons… but after that, there aren’t really any more numbers we’re excited about hitting - except, maybe, 65.

Age 65 is generally the trigger for Medicare eligibility so that’s one birthday which sometimes can’t get here soon enough because it saves us money on our health insurance costs.

All the Parts to Medicare

There are four parts to Medicare: Parts A, B, C, and D. Part A covers hospitalization, part B covers doctor visits, and part D covers prescriptions. Most people with “original” Medicare have those three parts. But what about part C? Part C is a managed-care option and does not mix with the others - more on that soon.

If you have a Medicare card, look at it. It will show the dates that parts A and (if applicable) B became effective. Commonly, they are the same date. It is often the 1st of the month in which you turned 65 so if it is your birth month, that is not a coincidence! Sometimes, the part B date would coincide with your retirement, especially if you continued your “work coverage” after turning 65.

If you do not have Medicare yet, there are a few things you will need to consider soon, but the most important is this: it is imperative to start the process before or during the “Initial Enrollment Period”. This seven-month window includes your birth month and the three months immediately before and after. Failure to do so can cause delays, gaps in coverage, and even penalties.

If you are still working and not collecting Social Security, there is some wiggle room, and there will not necessarily be penalties, but I have seen many cases where people waited too long to get the ball rolling and had to go without coverage. That is not something you want to start your golden years with.

If you are unsure about any of this, give us a call! It is something you only get one crack at, so we want to make sure you get it right the first time. I hate to be the bearer of bad news when someone must pay a penalty and/or is going to have coverage denied. For people who get a late start, there are “special enrollment” periods, “general enrollment” periods, and “open enrollment” periods. That is a little too technical for our purposes today, but it is something we are always willing to discuss!

Does Medicare Cover Everything?

Not exactly. Just like they did not intend Social Security to be a sole source of retirement income, they did not design Medicare to be an all-inclusive healthcare plan. There are certain gaps, deductibles, and copays that the participant must pay. That is where Medicare Supplement plans and the Medicare Advantage plans come in.

This is another topic that is technical, so I will give you the basics as we circle back to the “parts” mentioned above. Remember, I said people with original Medicare had parts A, B, and D. That is where a Medicare Supplement plan generally makes an appearance.

If your doctor accepts Medicare, he must accept your supplement plan regardless of the provider. This option is the ultimate in flexibility because there is no network; the coverage works anywhere that Medicare does. Depending on the specific plan, your supplement will pay some or all the deductibles and co-insurance amounts.

A Medicare Advantage plan, on the other hand, comes with a “network” which is a list of participating providers. There is no guarantee that your doctor will accept the plan, even if they accept Medicare patients. That is where it can get a little sticky, as networks can add/drop physicians at any time.

Typically, the premiums are a little more favorable with the Advantage plans, but they have that specific network of providers. This can be especially troublesome for snowbirds who may spend time in different states at different times of the year. Sometimes the copays can exceed the costs saved with the lower premium. As is often the case, “cheaper” is not always better.

Which Plan Is Best For Me?

I hate to say it, but it depends. Everyone’s situation is a little different, and many variables will come into play. Your health, finances, geography all are part of the equation when figuring out what is best.

What I can tell you is that we are here to help! I have been working with my clients on these decisions for over 20 years, and I’m happy to evaluate your situation and give you my advice. Even if you are in a plan that you think you like, but you are not sure, we can review that for you and compare it to what else is out there.

If you have original Medicare with a supplement, you do not even have to wait until the open enrollment period in October to make a change. You are free to explore changes at any time of the year!

Do Not Wait to Start the Process

Especially if you have a triggering event coming up (retirement, turning 65, etc.), make sure you look into this as soon as you can. As mentioned, it is important to have your proverbial ducks in a row. Sooner is always better than later with Medicare!

Do not hesitate to give us a call if you have any questions at all, regardless of age. You could be a Medicare veteran at this point; it still makes sense to review your current plan from time to time- just like any other type of insurance.