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Printers

Because insurance is extremely technical, a deep understanding of insurance underwriting is necessary, printing companies are best-served by an insurance agent with that experience. This is why maximum protection at the lowest cost results from a program that combines the correct insurance coverages with risk mitigation.

It starts with a hands-on, in-depth understanding of the business, and depends on an insurance agent’s ability to analyze situations, to see what others miss or ignore, and culminates in the creative design of a custom insurance program.

Essential coverages

  • Blanket Building and Personal property
  • Personal Property of others: Replacement cost included in Blanket limit
  • Agreed Value
  • Equipment Breakdown
  • Business Income with Extra Expenses—2 years
  • Business Income from Dependent customers
  • Electronic Data Processing equipment coverage
  • Employee Dishonesty
  • Employment practices liability with third Party coverage
  • Computer and Money Fraud
  • Cyber Liability
  • General Liability
  • Printers Errors & Omissions Liability
  • Rework/correction of work coverage
  • Environmental Impairment Liability

Critical issues

  • Preparing a disaster recovery plan
  • Property values evaluations
  • Building and personal property evaluations: what is building and what is personal property
  • Identify chemicals in the work place and evaluating exposures to loss from pollutants
  • Emergency Plan to guarantee continuation of services to clients
  • Personal property of others evaluation and coverage on replacement cost basis
  • Identifying dependent vendors or customers
  • Implementing a workers and driver safety program

Questions insurance agents often fail to ask?

  • Does the applicant have a disaster plan?
  • If your building sustains a major loss, what new building codes would be imposed on the applicant in order to rebuild?
  • Are the inks used considered flammable?
  • Are chemicals stored on premises? Are they flammable and/or toxic?
  • Would it be necessary to resume operations immediately following a direct damage loss, regardless of cost?
  • Is your print equipment attached to the floor or a wall?
  • Are your potential employees screened prior to employment? Are references required and verified?
  • Do you have a client that accounts for more than 10% of your annual sales?
  • Is there an adequate separation between employees who receive cash and/or checks and those responsible for maintaining the books?
  • Do your employees have access to the computer database from off-site locations?
  • Do you utilize the Internet to transact business and/or transfer money, securities or goods?
  • Do you receive dividends with your insurance?
  • Do you have a safety program? If no, are you interested in implementing one?
  • Do you have a fleet safety program? If no, are you interested in implementing one?
  • Do you need MVR’s on new hires?

Loss Control

  • Masonry Noncombustible construction is preferred.
  • Separate ink operations from other areas of the facility.
  • For maximum protection within the facility and to limit losses, rooms should be separated by one-hour-rated fire walls.
  • Dust collection systems should be in place to prevent fires. The dust created during printing operations can ignite quickly and potentially cause a total loss.
  • Isolate Heat Transfer Fluid Systems. Provide metal covers for rotary couplings, nonabsorbent insulation, safety shut-off valves at all use points, and liquid containment for the HTF cut-off room. Also, the expansion tank must be ventilated to a location outside the building.
  • Install wet automatic sprinklers throughout the facility. This includes sprinklers in and around the presses not just ceiling sprinklers.
  • In the event of a fire, interlock the following systems: ink, solvent, thinner, and blanket wash pumping systems, vacuum systems, hydraulic oil systems, lube oil systems, and pneumatic systems. Include both an automatic shut-off and a remote manual shut-off.
  • Install a special protection system. For example, protect unenclosed presses with a local application CO2 system and protect enclosed presses with a total flooding CO2
  • Clean and test the static eliminator system periodically.
  • Develop a safety and housekeeping plan. Post it in clear view in numerous places so that it is always on the employees’ minds.
  • Create a procedure for transporting flammable liquids within the building.
  • Establish a cleaning schedule for presses, ink troughs, folders, dryers, slitters dust collection ducts, baler rooms, areas below the press, and oil-collection pans. Keep records of cleanings.

Case History

The Case of the Surprised Owner

Situation

After being introduced to owner of a printing and mailing company, Joe Rueter met with him meeting regarding the company’s operations, followed by a tour of its two facilities.

The owner thought the company was protected with its current insurance program and broker’s services. However, he allowed Rueter to review the insurance coverages and then provide a risk management assessment. The owner supplied Rueter with copies of the current insurance policies.

Findings

Based on his review of the insurance program, Rueter identified critical coverage and insurance program issues:

  1. The storage building at location #2 was incorrectly stated on the insurance application and policy as joisted masonry construction, when it was actually masonry-noncombustible. Rueter supplied the Insurance Services Office with an inspection report showing the error, and the company received a $7,500 refund on its property policies for the three prior years.
  1. The main printing location did not receive credit for the sprinkler system because the paperwork filled with the property rating bureau was incorrect. Rueter supplied the necessary information, which lowered the rates and premium for the main location, resulting in a savings of about $5,000. However, Rueter’s efforts to back date any credits failed. This insurance broker’s error was estimated to have cost the insured more than $20,000 over the preceding four years.
  1. During his inspection, Rueter found that the Heidelberg printing press was bolted to the floor, thus making it part of the building. However, the agent had the values for the Heidelberg listed as personal property, not those for the building as defined in the policy. According to Rueter’s analysis, the property was grossly underinsured, and the insured was paying a much higher rate on the Heidelberg press than necessary. Rueter corrected the mistake and saved the company an additional $2,000.
  1. To alleviate any concerns about the definition of building and personal property and the movement of stock and equipment between the two buildings, Rueter recommended blanketing buildings and contents. This gave Rueter’s “newly educated” insured peace of mind knowing the property was properly should a disaster occur.
  1. One client generates 40% of the company’s annual sales from a single location in Atlanta, GA. Based on this information, Rueter recommended adding business interruption coverage to the policy for a dependent property. Because the client operates from in a highly protected building with substantial fire suppression devices in place, it was reasonable to add a $1,000,000 limit.
  1. The client stored personal property of others that was currently insured on an actual cash value basis. Based on that information, Rueter recommended a replacement cost valuation, as stated in the written agreement with the company’s clients.
  1. The insureds lease did not have a mutual waiver of subrogation, so Rueter recommended either increasing the Building Legal Liability or revising the lease.
  1. Rueter requested the client’s drivers’ list, prior to marketing the account, Rueter ran a motor vehicle report, indicating that one driver had a driving with a suspended license. The insured reassigned the employee to non-driving duties and saved the company from fines and increased liability should an accident occur.
  1. For 90-days prior to hiring, the insured uses a temp employment agency for new employees. The temp agency provides workers compensation insurance but does not provide an alternate employer endorsement naming Rueter’s client as additional insured. Rueter covered this gap.
  1. During a follow up meeting with managers of the printing and mailing company, the group discussed the need for an employee safety and fleet safety program, and with the assistance of both their new insurance carrier and Rueter Insurance, they improved their loss prevention program. 

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