The modern society has very strong litigious mechanisms and dynamics. And small businesses risk facing professional liability that will more likely end their existence than in case of big enterprises. However, the majority of small business owners do not think much about developing a reliable insurance portfolio for their enterprises, which would provide protection and risk assessment to the right extent. And that’s certainly not the best strategy for those who want their businesses to grow and develop well.

Building up an insurance portfolio

Don’t expect to find a universal solution for small businesses, as there’s no such thing as one-size-fits-all insurance portfolio for small enterprises. You will have to personally adjust and tailor your insurance policy in order to make sure your insurance needs are met to the right extent, combining numerous insurance products into a single portfolio. A typical insurance policy for small businesses is likely to include the following elements:

• Property insurance (covering damage to your buildings or property);
• General liability (covering damage to other party’s property);
• Errors and omissions (covering liability due to business practice faults);
• Workers’ compensation insurance (covering legal actions between you and your employees).

The purpose of errors and omissions insurance

Errors and omissions (E&O) is a special type of insurance coverage that is used for protecting your coverage against legal actions due to production mistakes. This is the same thing that is called malpractice in medical industry. Such errors represent a very high grade risk in any business circles. The following are some types of E&O a small business might experience (and get sued for, respectively):

• Shipping an order to the wrong destination;
• Destroying or damaging the property of a customer while providing services;
• Selling malfunctioning products that may be faulty designed or damaged during production;

There are a limitless number of examples to E&O in real life business practice, so of which may be less important and risky, while others may put you out of business for good. That’s why it’s important to have E&O coverage in your small business insurance package if you want to be protected against such risks.

Whom it concerns?

You may think that E&O is mostly designed for doctors, lawyers, realtors and production companies. The truth is that most enterprises no matter how big or small they are will need this type of coverage at some point of their existence. Of course, there may be situations when you won’t need this form of small business insurance, but you can never tell. It’s like having auto insurance: you can be a perfect driver but it doesn’t save you from having accidents on the road. You have to understand that paying for this type of coverage may take some money out of your limited budget but instead you assure better risk management for your enterprise and improve its chances of succeeding. Countless businesses have fallen prey to lawsuits caused by errors and omissions just because they didn’t have the coverage. And why would you want your business to follow?

The Health Savings Account (HSA) has a colorful reputation. Depending on who you ask, it’s either the best thing ever to come on to the healthcare market, representing a sweet investment opportunity for the healthy and wealthy, or it’s an unaffordable luxury plan of no relevance to the ordinary, low- and middle-income American. Well, let’s start with a simple definition. As the name suggests, an HSA is a savings account where you make provision for the need to pay all the obvious medical and long-term care expenses including some not included in the average health plan, e.g. dental care and drugs bought over-the-counter. Because this is for an approved medical purpose, the savings are “tax free”, i.e. come out of your pre-tax income. You can deposit up to $2,900 per year as an individual. It doubles to $5,800 for a family. The income rolls over, i.e. it accumulates with the investment returns also being exempt from tax. To encourage you to make active use of the account, it’s portable, i.e. you can move it from one job to another. It also remains valid whether you are unemployed or taking a voluntary rest between jobs. If you need to make a withdrawal, this is tax free so long as used for healthcare purposes. After you reach the age of 65, you can access these funds for any purpose, i.e. this can be a tax-free retirement savings fund.

If we stopped here, this would look a good opportunity for most people with a little surplus income. But an HSA must be paired with a high-deductible health plan. The minimum deductible must be $1,100 for an individual, doubling to $2,200 for a family. If a claim arises, you therefore pay this deductible and all the associated copayments and out-of-pocket expenses up to $5,600 (which doubles to $11,200 for a family) before the plan pays out. Thus, you may find treatment for an injury or illness eats into your savings or unused credit. Although the premium on a high-deductible plan will be lower than for the conventional plan, the savings will always be less than the potential out-of-pocket payments you have to make. Worse, if your health fails and you need more regular treatment, you will never realize the long-term benefits of an HSA. The money will never accumulate to give you real tax benefits. HSAs work best if you never make a claim. You will also be hit by higher administrative and transaction fees. If this gives you an incentive to refuse healthcare to maximize your tax benefits, this is a bad plan. Healthcare decisions should be driven by your medical needs, not financial advantage.

So, if you have good health and your financial resources will absorb the out-of-pocket payments should your health suffer, you should include an HSA in your request for health insurance quotes. The high-deductible premiums are among the cheapest you will find. But if you prefer the idea of a health plan where the insurance company picks up most of the bills, the HSA is not for you. You should focus your request for health insurance quotes on the conventional policies.

The internet is both a blessing and a curse. At the click of a mouse (or a twitch of your finger), you can now summon up a small mountain of information about just about everything. So, if we google Chinese restaurants San Francisco to plan our meal out, we get 35,400,000 hits. That’s just too much information. No-one could ever work through the first one-hundred thousand let alone millions. That’s why the second and third hits are potentially useful. They are “Top 10″ sites. Except, after years of experience, we all know many of the Top 10 sites are rigged. Either they are straight advertising sites with fake reviews posted, or the site owners balance out all the real bad with fake good reviews to make it look like the jury is still out. The idea of a rating or ranking agency only works when it is independent and fearless, i.e. prepared to post honest information despite all the threats of defamation actions that can be triggered. Unfortunately, we have also just watched the financial rating agencies give top grades to a passel of derivatives and bonds now only fit for feeding to the dogs. The curse is easily stated. Appearances can be deceiving on both sides of the fence. A top insurance company can look successful and have high ratings, but turn out to be a dog when you make a claim.

The first piece of advice is to ignore most of the reviewing sites. The majority claim to host genuine reviews but, in reality, a small band of dedicated people make a living out of writing reviews and posting them to every possible kind of site from social networking through blogs and their comments to dedicated reviewing sites. No matter what they claim, very few sites are reliable guides to an insurance company’s performance. What do you need to know? First, that the company is financially sound. You do not want to start paying your premium instalments only to have the company enter bankruptcy protection six months down the line. The reputation of all the top rating agencies has taken a beating. You will find useful information on Standard & Poor’s, Fitch and Moody’s, but the most reliable is A.M. Best which specialises in the insurance industry.

The second thing you need to know is how well it handles claims. There’s a Department of Insurance in every US state to regulate the local insurance companies. Without exception, they all operate a complaints service. In theory, this represents an excellent window into the secretive world of business, but the quality of what you see is affected by politics. In the best states where the policy is to protect consumers, the Departments name and shame the worst performing companies. Check out your state’s website. You may find objective information, listing the companies by name and giving a count of the number of valid complaints made. If you are unlucky enough to live in a Republican state, there will be no useful information. Now, when you search for the cheapest car insurance you can check the companies for financial stability and the number of complaints upheld by state regulators. This should guide your choice of policy to buy. Many times, the cheapest car insurance is not the best.

Perhaps it’s the wrong way to think about insurance, but it’s really nothing more than a form of licensed gambling. You find this insurance company prepared to take you on and then place a bet on how long you are going to live. The insurance companies studies the form guide and decides how long people like you tend to live. It sets the premium and the jackpot number. If you die within the first few years, your family are big winners. They hit the jackpot for just a few premium instalments. But if you live far longer than expected, the insurance company wins big because it has the use of all your money during your lifetime and only pays back the sum agreed. That’s one of the interesting things about inflation. What looks a big number now may be peanuts in fifty years time. That’s why buying a policy with a fixed benefit is such an interesting bet.

Now to a simple distinction: a term policy buys you a fixed cash sum if you die within the period agreed. If you live past the due date, you lose, i.e. no benefit is payable and there is no refund of your premium instalments. The contract terminates. A permanent policy pays a benefit but there is an accumulating cash value, i.e. there is a form of savings account built into the plan. This appreciates in value during the term of the policy so, if the insurance company makes good investment decisions, the amount payable on death can be significantly more than the amount you paid in. This reflects and offsets the problem of inflation. Agreements to pay a fixed dollar amount usually represent very poor value over the long term. The further benefit of the investment element is that you can recover the cash value of the policy before you die. This is done either by surrendering the policy to the insurance company or by selling the policy on the open market. Sale of the policy realises more than the surrender value. Alternatively, most insurance companies allow you to borrow money from the investment account. This is good over the short term but never forget that interest is payable on the loan. If you are not careful, the continuing deduction of interest over time can wipe out the remaining cash value in the account. It is always worth paying back the loan or cutting your losses and surrendering the policy if repayment is unaffordable.

Because it has additional value, permanent life insurance policies are more expensive to buy than term policies. But, once the contract is in place, the amount of the instalments is fixed so, as inflation devalues the dollar, it becomes an increasingly affordable proportion of your monthly paycheck. If you renew successive term policies, the premium rises with each new policy. Some argue that the key advantage of term policies is you get cheap coverage and can invest the money saved on the premiums. If you make good investment decisions, you can emerge a winner. So, if you are only thinking short-term, i.e. up to ten years, go for term. If you are thinking strategically over your lifetime, go for a permanent policy. When buying the first policy or looking to top up your cover, always get the maximum number of life insurance quotes to ensure you find the best deal.

Once, the world was simple. If there were two opposites like either/or and day/night, it was easy to treat them as different and act accordingly. Then along came the idea of equality and some opposites were judged the same when it came to the treatment they deserved. At least, it’s now politically incorrect to suggest men and women should be treated differently. So the law imposes rules to prevent discrimination on the ground of sex (or gender if that is also different). Except that, when it comes to insurance, there are some very good reasons for treating men and women differently. Although the law may have changed, there are some fixed biological and cultural roles that seem permanently attached to women. We may now vote, own property and pursue our own careers, but we give birth and are expected to raise a family with the possibility of becoming a carer for elderly parents. In juggling between all these conflicting demands on our time, it’s easy to drop the ball of financial planning.

In a perfect world, we women would sit down calmly and set out a plan for our lives. This would list goals and some way to monitor progress so that, if we seem to be straying off track, we can steer back on course. There would be milestones: getting a job, saving for our own home, avoiding debt, planning a family. If our partner, children or parents come to depend on the income we bring into the household, we should think about insurance. How could we leave them without providing for them? If we are not a burden to them during our lives, we do not want to become a burden by leaving them. So we need enough coverage to clear the mortgage on the home, pay for the education of our children and buy in care for our parents. In this, it does not matter whether we are a single mother or one of a couple. Loss of our earning capacity affects everyone around us.

Then we come to the key difference. We live longer than men so the right life insurance policy is our way of saving for retirement. As we reach the end of our working lives, all the major debts should be paid off. Hopefully, we have made pension arrangements and can live simply. But there are always emergencies. In such cases, having a policy with a cash value or an investment element gives us a safety net. In the worst case, we can sell the policy for a lump sum. With the right policy, we can draw down cash or borrow against the anticipated benefits. This need for long-term thinking means we should take extra care when getting life insurance quotes. We should cover the range of policy types. It may then be appropriate to talk to an independent agent or broker to get advice. The aim is to ensure we have the right level of coverage at an affordable premium during our lives with adequate protection for our retirement needs. Rising above the selfish needs, we can also think about the flexibility to provide cover for the family we leave behind. This may involve planning to increase the investment element as we grow older, or adding coverage to boost the benefits we leave behind at the end of a long life.

One of the big dilemmas for any country’s government when it bails out a business deemed “too big to fail” is how far it should go in managing that business. There is a temptation to actually start calling the shots whenever this is seen as necessary to protect the interests of the taxpayers whose money is bailing out the company. For example, if tax dollars are propping up a bank that has lent hundreds of millions to home buyers, should the government tell the bank to take a less aggressive approach to foreclosures? You only have to look at the public anger when top executives in these businesses started awarding themselves big bonuses, claiming their performance as managers justified these rewards.

The insurance industry in Michigan is up in arms so there must be something good for consumers happening there. The Property Casualty Insurance Association of America is leading the fight against a threatened attack on their members’ profits. The Board of State Canvassers in Michigan has just approved a petition for ballot in 2010. Despite the fact the insurance industry has remained profitable, paid its taxes and maintained its employment levels, the petition’s supporters allege insurers have been making excessive profits during one of the worst recessions in the last century. If the voters back the initiative, the legislature will be empowered to produce a number of direct limits on the way the industry assesses risk and sets the premium rates. The headline to sell this to the voters is genuinely eye-catching. The aim is to cut premiums on all insurance types across the board by 20%. Because drivers have been claiming that premium increases have been victimizing them, the initiative adds a further 20% cut for the best drivers. This shifts the risk profiling approach from the current factors such as zip code, credit score, marital status, etc., to factors directly assessing the driving skills of the individual drivers such as the driving safety record, the number of tickets issued, and so on.

The petition also acknowledges the insurance industry is likely to try to manipulate rates so there are a number of specific consumer protection or fair trade limits to be applied by the state’s insurance commissioner. He would reduce premiums thought excessive, prohibit insurers from cancelling the policies of those who complain, and so on. With some cheap auto insurance premiums potentially falling by 40%, the industry is alarmed. There are dire predictions of insolvency. So in the run-up to the voting, it will be interesting to see how the insurers react. If the auto insurance quotes rise fast in the next six months so that a forced reduction will be less painful, the voters will see greed and vote accordingly. But a fall in the quoted rates will produce some interesting politics.

Ensure proper protection for your home

People often underestimate the importance of flood insurance coverage until it’s actually needed. The important aspect about flood insurance is to realize that even if your mortgage lender does not necessarily require you to carry this type of coverage with your home insurance policy, it doesn’t mean that your house isn’t at risk of flood damage. The information provided by the Federal Emergency Management Agency concludes that 25-30% of overall flood damage is delivered to areas with low to moderate risk ratings. And in case you don’t have flood coverage you may end up having so much to pay for that it would be easier to buy a new house. In order to avoid such losses all it takes from you is getting flood coverage.

Evaluate your risk

Everyone risk having flood damage to different extent. Some of us live at the coast with routine floods and hurricanes. Others dwell inland but rivers, lakes and dams still make up a risk of damaging your house. FEMA provides homeowners with special maps that have risk scores accredited to all areas in the country, including several factors that can make an area more likely to have flood damage than another. Still, you have to keep in mind that although such maps are pretty accurate, they don’t provide a 100% guarantee that there won’t be any floods in an area which is denoted as to be risk-free. There are many factors that the specialist at FEMA just can’t predict and in case the flood comes it will really help having adequate coverage for your property.

Get insurance quotes

Before you actually buy flood insurance coverage for your house it is better to get multiple quotes to learn what is the competition in your area. Try to get as many quotes from different providers licensed for working in your state, because they can differ quite well from one another. Sometimes you can have quotes differing twofold for the exact same location and property. So try to learn the competition before enhancing your homeowners insurance policy with additional flood coverage.

Buy the policy

So you found a nice quote for homeowners insurance flood coverage? Well, now you have two options. First is working with your insurance agent to make all the arrangements. It is a good option if you have chosen to get the flood coverage from the same company that’s providing you with home insurance. In this case you can also opt for a discount, especially if you have auto or health insurance with this company too. Another way is to go with an online vendor. Online insurance sites are not only great for getting free homeowners insurance quotes but actually getting the policy. It usually requires filling out an online application form that will be sent directly to the insurance company. And if you are approved you will be notified personally. A great option for those who want to get flood coverage without the hassle of contacting insurance company representatives.

In a culture caught up in the can-do mentality, the idea of treating pain through the mind is viewed with some suspicion. People have been taught to believe drugs and formal invention by a trained specialist are the routes to an effective cure. This is the American way. If the body is broken, you fix the body. There’s no need for any New Age, touchy-feely talk. Indeed, people who persistently complain of pain but have no obvious injuries or disease, can find themselves attacked as malingerers trying to game the benefit system.

Family, friends and neighbors can rapidly run out of sympathy if you seem to be a freeloader. Against this background, the healthcare service does offer a limited range of counseling and support options. These services are not pushed more agressively because the high number of staff required to run these services drives up the operating costs. The hospital does not make as much profit as from other services.

There is a substantial volume of evidence from research studies around the world to prove a clear link between a patient’s attitude and a patient’s awareness of pain. Those who are relaxed and have a positive outlook on life have lower sensitivity to pain. Those who are anxious, stressed and shading into depression are more likely to experience more intense pain. For patients to get benefits from psychological counseling, they have to invest time and money. This is not an easy cure that might come from the simple act of swallowing a pill. It requires people to make an effort. Put all this together and you see the problem. Because many private health plans do not include the cost of counseling and family budgets are under strain with the current recession, most believe they cannot afford this approach.

The focus is on the cost now, not the cost of drugs spread over years. In the long term, people will save money but it requires investment now. If this means a little extra debt, it’s well worth it. The most recent research published in The Journal of Pain shows that even one hour of meditation training produces a reduction in the level of pain felt. The full range of treatment options are meditation training, distraction and relaxation. The evidence clearly shows that people feel less pain while actually meditating. Even after meditation, the effect of pain relief continues, i.e. people perceive the pain differently. Similarly, people who train their minds to relax or focus their attention on different factors in the environment also experience pain relief. The level of pain remains unchanged. The focus in all three options is to treat the emotional response to it.

None of this denies the valuable role to be played by drugs such as tramadol. As one of the first-choice drugs used by people in pain, there are millions who will testify that it works to relieve moderate to severe pain. It does make sense to buy tramadol and get some of that relief. However, no matter how convenient it is to pop pills, in the long term, meditation is cheaper and better. It’s your choice.