|
INDEX
|
|
 |
|
The wildfire season is off to a quick start this year. Several blazes have destroyed tens of thousands of acres and scores of buildings. The recent wildfire in Santa Barbara burned almost 9,000 acres, destroyed scores of buildings and forced the evacuation of about 30,000 people. Almost twice that amount of land burned along the South Carolina coast in April, and drought-plagued Texas has been hit by a series of fires that have consumed tens of thousands of acres.
Now that fire season is in full swing, it would be a good idea to take a few minutes to make sure your business is prepared in case the worst does happen. Here are some simple tips from Cal Fire to help avoid wildfire damage:
- The most important short-term solution to fire prevention is simply making sure there isn't a lot of flammable material around your property. Cal Fire recommends that there be 100 feet of defensible space around all buildings. This involves removing all flammable material within 30 feet and creating a "reduced fuel zone" within the next 70 feet.
- Make sure your roof is clear of leaves, needles and overhanging branches.
- More long-term solutions to fire danger include planting fire-resistant vegetation and installing more fire resistant roofs, gutters and outer walls.
Those in rural, wooded areas are obviously the most likely victims of a wildfire, but even those in more urban areas should be prepared for a fire. Here are some general fire safety tips for business owners:
- All businesses should install automatic fire sprinklers and have an adequate number of fire extinguishers.
- Fire extinguishers, however, lose their charge over time, and so it is important to have them inspected periodically.
- Simple smoke detectors can be one of the best lines of defense and also should be inspected periodically to make sure they are still working.
- Make sure any flammable chemicals or other materials are stored properly.
- Overloaded electrical circuits are one of the most common ways fires start at a business. Make sure you install surge protectors and that wires and cords are in good condition.
And, of course, you should make sure you have adequate insurance coverage because even the most careful businesses can become a fire victim. That means making sure you have enough to cover 100 percent of your losses and enough business interruption coverage to make up for any revenue you will lose while your business is closed for repairs.
Return to Index
| Obesity shrinks productivity |
It's no secret that Americans are getting more obese. The Centers for Disease Control and Prevention reported that in 2005 and 2006, the last years for which information is available, more than 34 percent of Americans were obese. That's more than twice the rate from the late 1970s and, according to the Organization for Economic Co-Operation and Development, the highest among the 30 democratic, capitalist countries that are members of its organization. But what some employers might not realize is that obesity can really affect workers compensation costs and workplace productivity.
A paper issued several years ago by the Insurance Information Institute reported that obese workers are more likely to have chronic diseases and they simply don't bounce back from injuries as quickly as thinner, more healthy employees. "[M]edical costs for obese and overweight people injured on the job are likely to be higher and time away from work is likely to be longer," the report said.
This is backed up by a study published in the current issue of the American Journal of Health Promotion. In the study, being obese and having type-2 diabetes was an excellent predictor of lower workplace productivity. Workers in this category missed an average of about 5.9 hours a week because of health problems that affected productivity on the job. In comparison, normal-weight participants in the study who were at a low risk for diabetes reported losing about 3.6 hours per week due to health problems.
So, what's an employer to do? Simply firing or not hiring obese workers isn't really an option as courts are increasingly regarding obesity as a condition protected by the Americans with Disabilities Act. Another option is workplace wellness programs, some of which have proven effective in promoting healthier employees. That's the approach advocated by Kathleen Fox and Anne Wolf, co-authors of the American Journal of Health Promotion study.
"From an employer's perspective, this study provides evidence that workplace wellness programs that include weight loss and weight management would be beneficial for obese employees with or at risk for diabetes," Fox said. Wolf agreed saying, "Employers who spend money in a lifestyle intervention will find their investment returned to them in the form of increased productivity and reduced absenteeism."
Return to Index
| Economic costs of disease scare |
The threat of swine flu becoming a deadly, world-wide pandemic seems to have passed. As of mid-May, there were less than 100 deaths being blamed on the flu and the worst seems to be over. And while the death toll was mercifully lower than many had feared, the economic damage to some parts of the world was truly devastating.
Much of Mexico City was closed down for days during the height of the swine flu scare. The government had ordered all non-essential businesses to close for days and much of the city of 9 million people looked like a ghost town for more than a week. According to a report from El Universal, restaurants in the city alone were losing almost $5 million a day during the scare.
Since 1900, there have been three worldwide flu pandemics: the 1918 Spanish flu, which killed more than 50 million people; the 1957 Asian flu, which killed almost 70,000 in the United States; and the 1968 Hong Kong flu, which killed around 34,000 people. The World Health Organization has warned that "[w]ith the increase in global transport, as well as urbanization and overcrowded conditions in some areas, epidemics due to a new influenza virus are likely to take hold around the world, and become a pandemic faster than before."
For businesses, it's not just the pandemics that can be financially devastating. The threat of a pandemic can do severe damage just as easily as a real outbreak. Swine flu, SARS and bird flu all created enough fear to affect economies and do damage to businesses' bottom lines.
But insuring your business against losses from scares like swine flu isn't a straight forward proposition. Looking at your business interruption coverage is a good place to start. Having business interruption insurance is a good idea for any business as it protects against losses incurred while your business is closed following a natural disaster, fire or other physical damage. Many businesses that are forced to shut down after a disaster never reopen, so having the protection of a business interruption policy is important.
The trouble with relying on business interruption insurance in the event of a pandemic scare is that most policies require some physical damage before coverage kicks in. Whether a viral infection is physical damage is not clear. And even if it is seen as physical damage, there might be limitations on coverage for contamination. Business interruption coverage was never really designed to protect businesses during an outbreak. It is designed mostly to help businesses recover from fires and storms, not government mandated quarantines. But all is not lost. It might be possible to get coverage under a "civil authority" policy, which covers certain government forced evacuations, or there might be other ways to protect yourself. The bottom line is that any business owner who is concerned about an interruption created by a disease scare should talk to their insurance representative.
If your business involves a lot of travel, you may also want to look at business travel insurance. The terms for these policies differ and a close look at the terms might be needed to see if you are covered in the event of an interruption in travel due to an outbreak. Again, talk to your insurance representative if you have any questions.
Return to Index
| Potholes swallowing thousands of dollars |
Any business owner who keeps a fleet of cars or trucks knows that routine maintenance is a somewhat costly but important part of doing business. Regular maintenance helps prevent more expensive problems down the road. But that lesson seemingly hasn't been learned by the government, according to a report from the American Association of State Highway and Transportation Officials, and it's costing your business thousands of dollars a year.
The report says that deferred maintenance and an increase in traffic have combined to leave more than one-third of American roads in poor condition. The poor quality of U.S. roads is having a direct effect on the cost of operating a car, according to the report. Driving on rough roads costs the average driver about $400 a year in extra operating costs. That number jumps to upwards of $750 in urban areas where two-thirds of roads are in poor condition.
"The American people are paying for rough roads multiple times," said Kirk T. Steudle, director of the Michigan Department of Transportation. "Rough roads lead to diminished safety, higher vehicle operating costs and more expensive road repairs. It costs $1 to keep a road in good shape for every $7 you would have to spend on reconstruction. It's another drag on the economy."
The group is calling on all levels of government to invest more in maintaining U.S. roadways. "We hope Congress will make it possible for the federal government to sustain its share of the increased investment needed to keep America's roads in good condition. If not, it will cost the American people billions more later," said John Horsley, AASHTO's executive director.
Return to Index
| Business Briefs: Airbags save |
The mass introduction of front and side airbags in new cars has led to a significant drop in the seriousness and cost of injuries from crashes, according to a study from the Insurance Research Council. The council looked at crash data from 2007 to determine how much having airbags helped reduce injuries and costs. In 1990, only about 20 percent of new cars had front airbags; the other 80 percent had only seatbelts. By 2007, 82 percent had front and side airbags. In the study those in cars with front and side airbags were less likely than those wearing only seatbelts to suffer serious injuries or die. As a result, injury claim costs dropped from an average of almost $7,000 for those without airbags, to about $4,500 for those with front and side airbags.
Return to Index
| Business Briefs: Danger from above |
Most of the time the sun is a benign, life-giving object a comfortable 93 million miles from Earth. But every once in a while that distance isn't enough. Just like the Earth, the sun has a weather system, and this system can produce solar storms. Solar storms are eruptions of energy and matter that escape from the sun and may head toward Earth, where even a weak storm can damage satellites and power grids, disrupting communications, the electric power supply and GPS, according to the National Oceanic Atmospheric Administration. The NOAA just released its latest prediction, which calls for a weak cycle of storms for the next several years. But the most powerful storm on record occurred in 1859 during a weak cycle of storms. That storm shorted out telegraph lines causing fires throughout the U.S. and Europe. The National Academy of Sciences recently predicted that a severe storm could cause more than $1 trillion in damage.
Return to Index
|