By: Chris Boggs, Executive Director Risk Management and Education, Big I Virtual University

“Can a certificate of insurance limit the breadth of protection provided by the insurance policy and endorsements?”

This has to be the weirdest certificate of insurance (COI) question I have ever been asked. Generally, the question goes the other way, asking if language on a COI can broaden coverage.

Technically, the answer is the same regardless of whether the COI language “broadens” or “narrows” coverage – no, the COI does not alter coverage. However, and there is always a “however,” the practical answer can be “yes, the COI does alter the breadth of coverage” IF the holder is harmed due to detrimental reliance on the information contained in the COI.

Somehow, it seems unreasonable to assert that the holder can be harmed by detrimental reliance if wording in the COI narrows the breath of protection. Because detrimental reliance does not seem to be an issue, the answer is back to no, the COI does not affect the breadth of coverage provided by the policy. (Besides, the concept of “detrimental reliance” is for the benefit of the holder.)

Even the disclaimer language contained within the COI supports the idea that coverage is not altered. The COI (ACORD 25) specifically states:

“THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE CERTIFICATE HOLDER.”

According to the COI language within the form, coverage is not amended in any way. Seems relatively clear that, short of detrimental reliance, nothing in the COI alters the reality of the policy language.

Back to the initial question, and the reason for this review, “Can a certificate of insurance limit the breadth of protection provided by the insurance policy?” Obviously, the COI cannot narrow the clear policy language any more than it can expand it.

Why, then, is this a question to consider? When the insurance carrier tries to get out of paying a claim because of information contained on the COI.

How absurdly ironic. It is understandable for a carrier to attempt to avoid paying a claim because the COI expands coverage. But it seems incredibly ridiculous (maybe not quite to the level of bad faith, but close) for the insurance carrier to then use the COI to claim that the policy doesn’t respond because the COI narrows the breadth of coverage.

The carrier cannot have it both ways. Either the COI affects coverage or it does not!

Let’s use the Automatic Additional Insured endorsements as an example. For this example, the narrower of the two available ongoing operations automatic additional insured endorsements is used, ISO’s CG 20 33 - Additional Insured-Owners, Lessees or Contractors-Automatic Status When Required in a Written Construction Agreement With You.

This is considered the narrower of the CG 20 33 and CG 20 38 because it requires “privity of contract,” meaning that to be an additional insured, the party must be the contracting party. The CG 20 38 automatically extends AI status to any party requiring such status in the contract, not just the contracting party. (Irrelevant to this article, just for information.)

ISO’s CG 20 33 extends additional insured status to, “any person or organization for whom you are performing operations when you and such person or organization have agreed in writing in a contract or agreement that such person or organization be added as an additional insured on your policy.”

“Any” is a relatively broad term – it means any. The wording extends AI status to “any person or organization” the insured is performing operations when a written contract requires AI status be extended to that contracting party. There is very little doubt of the intent. If the contract requires AI status be extended to the party with privity of contract, AI status is extended.

How could the COI possibly be used to narrow this grant of protection? Many agents are in the habit of listing the relevant project in the Description of Operations; or possibly such listing is required by the contract, but does listing the wrong project in the COI negate the grant of AI status found in the endorsement?

Assume the insured works on many projects for the upper tier contractor, each under separate contracts, and all contracts require AI status. Presently the insured is working three projects:

• Johnson Project at 123 Main Street;

• Smith Project at 321 King Street;

• Jones Project at 456 Meeting Street.

The agent issues a COI for each of the project but forgets to change the project name within the COI’s Description of Operations. Does the listing of the Johnson Project in the COI for the Smith Project change the grant of AI status?

Don’t laugh! This is a real possibility, especially if the loss is large enough.

Let’s answer three questions:

• What does the endorsement require for a party to be

   an AI? A written contract. As was already stated, each

   project was under separate contract. But even if all

   projects were on the same contract, there is still a

   written contract in place requiring AI status.

• Does the endorsement reference any documents

   OTHER THAN the written contract? Well, no. The

   only document referenced in the endorsement is the

   contract. The COI isn’t contemplated in the application

   of the endorsement.

• Does the COI alter coverage? Seems this has already

   been addressed. Technically no, unless the HOLDER is

   harmed by detrimental reliance.

This leads to the ultimate question, does having the wrong project and/or address affect the extension of AI protection to the upper tier contractor? No!

Certainly no insurance carrier would attempt to use a COI to limit coverage when they are endlessly stating that a COI does NOT expand coverage. This would be the height of irony and an ethical low point.

As we mentioned in last week's Big I Buzz, October is Breast Cancer Awareness Month. Throughout the month, it's important to be showing support by wearing pink throughout the month, donating to cancer research and reminding yourself of the importance of performing self-exams throughout the entire year!

Raising breast cancer awareness is especially important for all of us at the IIAW. Recently, Trisha Ours, our Director of Insurance Services was diagnosed with breast cancer. A message from Trisha: "My cancer diagnosis is still new (end of September), but so far it appears to be stage 1A triple positive invasive ductal carcinoma. However, I've been told that I can be re-staged multiple times during my battle with breast cancer and at any time can have a recurrence of metastatic disease. This is why it is so important to do self-exams and schedule your mammogram screenings. If I had not been doing self checks or just brushed it off instead of contacting my doctor right away, I could be looking at a much more dire situation."

As the IIAW team raises awareness for breast cancer, we have started a fundraiser for metastatic breast cancer research in Trisha's honor. METAvivor is an organization dedicated to the specific fight of women and men living with stage 4 metastatic breast cancer. If you would like to donate, please head to our team page: donate.metavivor.org/team/383943. 100% of every donation to METAvivor goes into their research grant. 

Consumers are Splurging on Diamonds. Signet Jewelers Just Hiked Its Full-Year Outlook - Again

For the second time in weeks, Signet Jewelers have raised their fiscal 2022 forecast, as consumer demand increases before the holidays. According to the company, they're not experience any supply chain disruptions unlike many other stores in the retail industry. As consumer demand for diamonds are expected to grow throughout the holiday season, this could be a great time to push insuring expensive jewelry and gifts. 

Feel free to right-click and save this image to share on your social media feeds to encourage followers on Facebook to contact you about insuring their expensive jewelry and gifts throughout the holiday season. If you don't follow our Facebook page already, head to facebook.com/iiaofwi to see our daily posts that you can share onto your own page. 

Insurers in Illinois Now Required to Report Dog Bite Claims

Starting January 1, 2022, home and renters insurance companies must provide certain information regarding dog bites. The new Illinois insurance code asks all insurance companies to document and report information including, "

1. The breed of the dog and whether the identification was made visually, or by the owner, adjuster or insured; 

2. Where the owner of the dog obtained the dog from, such as pet store, breeder, animal shelter or rescue organization, a friend or acquaintance, or if they found the dog or it was a stray; 

3. The sex of the dog and whether or not it was neutered or spayed; 

4. Whether or not the person injured by the dog was observed teasing, tormenting, battering, assaulting, injuring or otherwise provoking the dog; 

5. The type of injury that was sustained by the victim, such as fall or bite; 

6. Whether the injury occurred on the insured's property or at another location, and

7. Whether the dog had received any sort of obedience training, or there have been previous claims or past complaints against the dog." This information must be collected for a two-year period starting January 1, 2022. Read more here: https://www.propertycasualty360.com/2021/10/11/illinois-to-require-insurers-to-report-all-dog-bites-414-211070/

For more news, check out the Action news section of our weekly e-newsletter, Big I Buzz. If you aren’t subscribed, click here to add your email to our emailing list. We hope that everyone has a great rest of their week!

Today is National Coffee Day! It's always a good day when you start it off with a cup (or three) of coffee. 

In this week's Big I Buzz, we are discussing how a few changes in your office can support productivity, how Wisconsin bars and restaurants are bouncing back post-pandemic and why millennials are buying more life insurance than other generations. 

8 Ways to Redesign Your Office to Support Productivity - Independent Agent

Independent Agent has put together a list of do's and don'ts to creating a space that encourages a productive work mindset. These are 8 things to consider when designing (or redesigning) your workspace to optimize productivity as workers return to the office: 

1. Look for bottlenecks. Review the layout for your workplace to determine if the setup you currently have is best suited for your team. Do you have two departments that often work together? Consider moving them closer to each other to avoid the back and forth. 

2. Room acoustics - sounds that are within a 20-foot radius have the most impact on employee concentration levels. Consider adding acoustic panels to reduce the noise in an open office space and ultimately, decrease distractions. 

3. Eliminate distractions - Independent Agent suggests polling your staff as to what distracts them the most. There may be a lack of sunlight or too much space to congregate, keeping them from staying focused. 

4. Offer opportunities for movement - According to the Fellowes Workplace Wellness Trend Report, around 87% of employees say they'd like healthier workplace options, including wellness rooms and ergonomic chairs. Other options include allowing a space to pace while brainstorming or encouraging time to walk during the work day. 

5. Encourage breaks - The average person can work nonstop for about 20 minutes before losing focus. A good way to ramp up productivity is by encouraging frequent breaks. Add a calendar reminder every 20 minutes to either switch projects or just to get up and move around for a few minutes to encourage productivity. 

6. Declutter the space - Those who are more organized than others may find another person's mess distracting from their work. Try to remove any unused items from common areas, or even within offices. 

7. Prioritize workflows - Review your workplace workflow. Recognize the areas where tasks are taking longer and invest in any technology that may help to automate repetitive tasks. 

8. Reassess frequently - As your business scales up, review these items to see whether these changes are continuing to improve your processes or see where you can make changes. 

Read more here. 

Wisconsin Bars and Restaurants Are Bouncing Back, But Not To Pre-Pandemic Levels

Wisconsin Policy Forum has released a new report finding low employment is holding the industry back from a full recover to pre-pandemic levels. According to Wisconsin Public Radio, "Food service has been one of the hardest-hit industries during COVID-19, with employment at bars and restaurants plummeting by nearly 50% in April 2020. According to last week's report, employment was still down 8.8 percent in August compared to pre-pandemic levels in August 2019. 

What makes this situation even more difficult is that business is booming. As many customer flock back to restaurants and bars, the establishments are struggling to keep up with the influx of customers. "This boom in sales should help restaurants and bars recover from a difficult year and a half, but it's not. Owners must contend with supply chain shortages, and any increase in sales revenue has to cover much higher food costs and increased wages." 

The report found that 39.1 percent of Wisconsin workers in accommodations and food services industry filed initial unemployment claims between March 15 and July 5, 2020. Unfortunately, that hasn't led many restaurants to receive workers back as they reopen. Some restaurants interviewed for the WPR story, told reporters that they had to run on only half of the employees they had pre-pandemic, with many restaurants forced to be closed some days so they can give those employees a day or two off each week. 

Read more here. 

COVID-19 Driving More Millennials to Buy Life Insurance Than Gen X & Boomers, Study Finds

A recent study from the 2021 Insurance Barometer Study found that more Americans will purchase life insurance over the next year due to the pandemic. Millennials said they're now more likely to buy life insurance coverage because of the pandemics. Compared to the Baby Boomers and Gen X individuals surveyed, millennials far exceeded those who would do the same. 

According to Fox Business, "While the impact of the pandemic has been tragic, it has also taught younger generations the value of financial decisions like purchasing life insurance, the study showed.... Just 52% of the American adults reported having life insurance coverage in 2021, but 73 million Americans (59%) said they need life insurance. About 29 million policyholders say they need to increase their current life insurance coverage, according to the study." Read more about the study here. 

For more news, check out the Action news section of our weekly e-newsletter, Big I Buzz. If you aren’t subscribed, click here to add your email to our emailing list. We hope that everyone has a great rest of their week!

On this week's Big I Buzz, we are discussing Apple's new security update, how many Wisconsin workers will be affected by the new vaccine mandate and how Girl Scout cookies are now being delivered in Virginia. 

Do You Own an iPhone or iPad? Update Your Apple Devices Right Now.

Researchers have recently uncovered a security flaw in Apple devices, including those for iPads, Macs and Apple Watches. The flaw could allow hackers to secretly install spyware on your Apple devices, even if you do nothing, not even click on a link. The recent Apple update includes a patch aimed to fix the security flaw. Read more here. 

How Many Wisconsin Workers Could Be Impacted by Biden's New Vaccine Mandate?

According to the Biz Times, "In Wisconsin, the new federal vaccination rule could apply to roughly 1.2 million workers, including about 382,000 in metro Milwaukee. That's based on 2018 figures, the most recent available data, from the U.S. Equal Employment Opportunity Commission, which annually surveys private sector employers with at least 100 employees and federal contractors with at least 50 employees. That year 1,209.412 workers were included in that data in Wisconsin, including 381,584 in the Milwaukee metro." The Republican National Committee has announced its plans to file a lawsuit against the Biden administration over the mandates. Read more here. 

Girl Scout Cookies Take Flight in Virginia Drone Deliveries

It's raining cookies - it sounds like a dream, but for some in Virginia, it's a dream come true. Residents in a Virginia community are receiving their Girl Scout cookies via a Google affiliate drone. According to Claims Journal, "The town of Christianburg has been testing a ground for commercial delivery drones operated by Wing, a subsidiary of Google's corporate parent Alphabet." Those in Christianburg who have been surveyed are showing content with the drones. Lee Vinsel, an assistant professor of science, technology and society who conducted the survey said that suburban setup is easiest for drone delivery. It's unclear at this time if they're looking to expand this delivery system to other states (like Wisconsin), but one can hope that we'll soon be opening our front door in pajamas to grab our Girl Scout cookies. Read more about the flying cookies here. 

For more news, check out the Action news section of our weekly e-newsletter, Big I Buzz. If you aren’t subscribed, click here to add your email to our emailing list. We hope that everyone has a great rest of their week!

Happy Wednesday! It's hard to believe that we are already kicking off the month of September, but here we are! In this week's Big I Buzz, we are discussing how some millennials are changing careers, the new budget resolution passed last week and how bears are becoming a threat in fight against the Minnesota wildfire. 

These Millennials Are Dumping Their Jobs to Plot New Careers

According to The Wall Street Journal, some young professionals are choosing to quit the job post-pandemic without a Plan B. "U.S. workers are quitting their jobs at some of the highest rates in years, a sign of great appetite for change and confidence in better prospects down the line. The share of people leaving jobs reached 2.7% in June, according to the Labor Department, just shy of April's 2.8% rate, the highest level since the government began tracking quit rates two decades ago. 

Now is a great time to train the right employee who's looking for a switch into the insurance industry. The IIAW has options for employee training through New Level Partners platform, My Agency Campus. My Agency Campus is a great hub for employee training ranging from insurance basics, specific job roles ore even specific business skills. My Agency Campus is an easy-to-access learning tool with training bundles tailored by job role and experience. You can browse the course offerings and help new hires achieve their professional development goals here: https://www.iiaw.com/page/EmployeeTraining. 

House Democrats Pass $3.5 Trillion Budget Resolution

Last week, U.S. House of Representatives Democrats passed a $3.5 trillion budget resolution that unlocks the process known as "reconciliation". While previously passed in the Senate, it did not receive a single Republican vote in either chamber. According to Independent Agent Magazine, "Reconciliation allows the majority party in the Senate to use spending or revenue bills to expedite consideration of certain tax, budget and spending-related legislation. While limited in use, budget reconciliation measures in the Senate require a majority vote and not the normal 60-vote threshold to overcome a filibuster and pass legislations." 

The reconciliation outlined the spending priorities, it did not outline how it will pay for the spending. "Based on the contours of the budget resolution, the reconciliation package could include up to $1.7 trillion in tax increases... Importantly for agencies that file taxes as a C corporation, which is roughly one-third of Big "I" members, President Biden has suggested raising the corporate tax rate from 21% to 28%. For the two-thirds of Big "I" members organized as pass-through entities, President Biden's proposals earlier this year did not call for any changes to the 20% tax deduction for small businesses that was created in former President Donald Trump's Tax Cuts and Jobs Act. " Read more here. 

Bears Emerge as Threat in Fight Against Minnesota Wildfire

As officials are working to stop the spread of the wildfires in northeaster Minnesota, bears are creating a new threat. Generous donations of food and supplies have out-stripped the need and storage ability. Because the storage space has been filled with donations, extras are needing to be stored out in the open, making them an attractant to bears. While blackbears common in northern Minnesota rarely attack people, food can cause conflicts with the bears. So far, the fire has destroyed 14 "primary structures" - mostly homes and cabins - and 57 outbuildings in a major run last week. it stood at 14% contained as of August 30th with a projected containment date of September 10th. 

Despite the damage, Superior National Forest officials are appreciative of the donations, however, they do not need any more. For those that would like to continue to donate, officials suggest donations to local food banks and fire departments instead. According to Insurance Journal, "The Forest Service also reported no growth thanks to the rain on two other, smaller wildfires of concern, the John Ek and Whelp fires, which are inside the Boundary Waters Canoe Area Wilderness. Crews have just begun efforts to fight those fires on the ground because they're deep in the wilderness in hard-to-reach places. Fears that the two fires could expand while firefighting resources have already been stretched thin by the Greenwood Lake fire and severe drought conditions led the Forest Service Aug. 21 to entirely close the Boundary Waters through at least Sept. 4." Learn more here.

For more news, check out the Action news section of our weekly e-newsletter, Big I Buzz. If you aren’t subscribed, click here to add your email to our emailing list. We hope that everyone has a great rest of their week!