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A Risk Management Process for Your Auto Body Shop, Part 1

As the owner of an auto body shop, you are no stranger to unique risks.  In fact, risks in your shop can take many forms—from customer-related to employee safety risks.  While it may seem tough to pinpoint them all, it is essential that you do your best. Of course, you have garage insurance in place for the worst case scenario but preventing a claim is much better in the long run—the last thing you need is a rising premium!

Over the next couple weeks, we will show you FIVE STEPS that will help you manage the risks in your shop. This week, we have the first three:

#1: Identify. To identify, you may want to sit down with your business partner, managers and even employees. Brainstorm the risks that your business faces, both internal and external. Risks may include: auto theft, damage to inventory, employee injuries, customer fraud, stormy weather, and more. Once you are aware of those risks, you have completed the first step.

#2: Assess. Next, you will want to asses these risks as a whole. If this seems like a tough process, do not worry! Our agents at Wolpert Insurance are here to help you with this. We can help you determine which risks are the most probable in your shop. You may want to list these from highest to lowest risk, if possible.

#3: Evaluate. Once you have assessed your risks from most to least probable, it is time to figure out whether the identified risks can be avoided, reduced, or mitigated (especially the high-risk ones!) Ask yourself the following questions about each: Is there a way to avoid this risk? How can we reduce this risk? Is there a policy that needs to be in place? Is there NO solution for this risk?

Are you excited to hear what comes NEXT? Be sure to tune into our agency’s blog next week. We will share the two remaining steps! Can you guess what they are?

Key Person Coverage for Your Shop

Does your shop have a key employee? This employee may be your business partner, manager or even YOU! Defined by Investopedia, a key employee is “an employee with a major ownership and/or decision-making role in the business. Key employees are usually highly compensated. They may also receive special benefits as an incentive both to join the company and to stay with the company.” In short, key employees literally are the key to continued success!

Our question to you is this: How could you not protect a key employee with the right coverage?

If something were to happen to this key person, whether a major medical illness, disability or even death, what would happen to your auto shop? Would their loss affect your business? Your finances? Having key person life insurance is critical to avoid a financial disaster. At Wolpert Insurance, we can offer a Split Dollar life insurance plan.

This is a plan to purchase the required personal life insurance at a lower cost through the sharing of premiums by an employer and employee. This will not only help you retain key persons with a fringe benefit, but will also allow you to recover its contributions to premium payments once the policy is surrendered—or in some cases, as a result of a death claim.

There are plenty of advantages to a Split Dollar Plan, including:

•    Taxes may be saved by using corporate dollars
•    You receive life insurance coverage
•    You can recover its premiums paid to the policy

If you are interested in learning more about this type of coverage, please do not hesitate to reach out to our agency. At Wolpert Insurance, we are here to guide you through the intricate details of garage insurance. It is our goal to have your garage and auto body shop—and your employees—as protected as possible.

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The Importance of Umbrella Insurance on Your Garage Insurance Policy

Is your auto body and repair shop under an umbrella yet? Let’s face it: When you own an auto repair business, the chances of an accident or injury are pretty high! Liability issues are everywhere—in and outside your shop. Garage insurance experts, such as ours at Wolpert Insurance, understand that these risks must be managed and included within your program of insurance when appropriate. This is why we stress the importance of an umbrella insurance policy on your garage insurance plan.

Many of you may be wondering: What is umbrella insurance, exactly?

It is a policy that protects your business from liability claims that go above and beyond the liability limits of your standard garage insurance. It is called umbrella insurance for a reason! It will literally shield your business from a financial storm, making sure to protect you even when your liability insurance is exhausted.

We already know what you are thinking next: What does umbrella insurance cover?

It can cover a variety of liability issues, from bodily injuries on your shop’s property to those occurring in an auto accident. In the auto repair business, umbrella insurance is critical to avoid the loss of thousands or even millions of dollars.

Whether you are located in Massachusetts or the New England area, we encourage you to visit us at Wolpert Insurance. Our agents are experts in this niche industry and we have the solutions for your shop. To learn more about our umbrella and excess liability insurance policies, please call 800-299-6819. We look forward to safeguarding your garage!

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Garage Shop Owners: What Is Succession Planning?

As the owner of a garage and auto body shop, you have a number of responsibilities. While you may be focused on your trade and the work that comes with it, it is important to not forget about the logistics. This week, we would like to take a moment to discuss succession planning and what it means for your business.

So, what is succession planning?

Succession planning is the act of creating a structure for transferring business from one owner to the next. In essence, it brings together a number of critical players in the business, from the owners to partners to key employees and even advisors.

Why is succession planning important?

Succession planning is important; especially at the very beginning of business stages (remember the three that we discussed last week? It begins with an examination of financial, operational and even personal issues within the business. Once all three are looked at, the end result is a succession plan. The benefits of this are endless, including:

•    Improved operations (day-to-day and overall)
•    Boosted profitably and overall growth
•    Stronger relationships between everyone involved

At the heart of succession planning, there is also a buy-sell agreement. It is important that the person who is determined to take over the business has the proper funding and plan in place. A buy-sell agreement can help create a smooth transfer and transition for those who will remain active in the business.

As you can see, ensuring a smooth transition is critical as garage shop owner. Sure, you may only be getting started and are not thinking so far in advance, but planning in advance is STILL important. If you have any questions or concerns about succession planning or even buy-sell agreements, do not hesitate to reach out to us at Wolpert Insurance. We have a highly-educated staff ready and waiting to answer all of your garage insurance questions and concerns.

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The 3 Stages of Small Business Financial Planning

With the shortness of jobs these days, many college graduates decide to take matters into their own hands. If you are a professional in the auto body industry, you may consider opening up your own garage – or perhaps it is already up and running.  Whatever the case is, it is important that you go through specific steps in order to succeed… this means small business financial planning. When it comes to small business financial planning, there are a few main stages that may describe where your business is at this very moment.

The three stages are:

1.    Formation Stage – covering the basics for a new business
2.    Accumulation Stage – the stage in which your business is established but still growing
3.    Mature Stage – the stage where you may be approaching retirement

Each one of these stages is important – and of course, each one of these stages will come with its own set of responsibilities. As your expert garage insurance agency, we are here to discuss which types of insurance needs will apply to each stage. Consider the following for each stage…

Formation Stage
•    Do you have a will written? If so, is it up to date?
•    Have you considered a garage insurance package from Wolpert Insurance?
•    Have you considered key-person life insurance? It can protect both you and your family.
•    Have you protected yourself against disability?
•    Do you supply stellar benefits to your employees, including group life, health, disability and more?
•    Have you thought about implementing a stock redemption agreement or a buy/sell agreement with partners or stockholders?

Accumulation Stage
•    Have you kept up with reviewing the will and business arrangements?
•    Have you considered improving benefits for your employees?
•    Have you given your employees raises?
•    Have you considered reviewing your group insurance and key-employee insurance? You may need to purchase more.

Mature Stage
•    Have you review your wills and trusts with Wolpert Insurance?
•    Have you made reorganization agreements and plans?
•    Have you improved employee salaries – especially your important ones?
•    Have you thought about making charitable bequests to save income?

These are the questions that you should be asking yourself! Of course, our agents are here to help you, too.

So, where does your business fall? If you are ready to discuss the stage of your business with one of our agents at Wolpert Insurance, please do not hesitate to call 800-299-6819. We would be more than happy to get to know your auto repair shop and figure out exactly what insurance solutions must be implemented for success. We look forward to speaking with you!
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Why Do I Need Equipment Breakdown Coverage?

We’re back with another frequently asked question in the auto body shop and garage field. This week, we would like to discuss the need for equipment breakdown coverage.

Depending on the equipment and tools that your shop uses on a daily basis, you may be in dire need of this specialized policy. All too often, business owners will be denied coverage because he or she “assumed” that their property insurance covered ALL equipment. At times, this is not the case because property insurance may only cover external causes – not internal causes.

So, why should you consider this policy? Here are just a few reasons:

•    New technology, such as computerized equipment, is subject to breakdowns. If your shop uses any type of new technology, you may find out how expensive it can be to repair. Having this coverage in place may aid you during such times.

•    Do your employees travel with equipment from the shop? If a breakdown or accident occurs in a place other than onsite, it may not be insured by a traditional property policy.

•    Equipment breakdown coverage can cover a number of assets, including: heating systems, boiler and pressure vessels, electrical systems, production machinery, air conditioning systems, and much more.

As you can see, this policy will surely come in handy when something unexpected happens. The last thing that you need as the owner of a shop is to experience an interruption in business – this could cost you tens or even hundreds of thousands of dollars.

At Wolpert Insurance, it is our responsibility to guide our clients to the right coverage options. With that being said, we believe that many garage and auto body repair shop owners will benefit greatly by having equipment breakdown coverage in place. If you are interested in learning more about this specific garage insurance policy, do not hesitate to call us at 800-299-6819. We would be more than happy to go into further detail!

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What are Antiknock Agents?

We’re back with another FAQ to answer – garage and auto body shop style! While you may be focused on the tools and machinery that pose risks to the workplace and its employees, it is a good idea to think about chemicals, too.

Whether you are an employer or employee in a garage and auto body shop, it is crucial to be aware of the chemicals that you are working with. You must have a clear understanding of its contents, the hazards and how to prevent injury/illness.  This week, we would like to zone in on antiknock agents.

What are antiknock agents?

In short, an antiknock agent is a gasoline additive. The main purpose of having antiknock agents in the shop is to reduce engine knocking and increase fuel octane rating. Usually, these are made up of the following:

•    Methylpentadienyl manganese tricarbonyl (MMT)
•    Ketone solvents (such as methyl isobutyl keton)

In plain words, these ingredients may be harmful to you and your employees, possibly causing eye irritation, breathing problems, dizziness, headaches, nausea, and more.

Being exposed to MMT on a daily basis may have harsh long-term effects, such as damaged kidneys and liver. The Manganese found in MMT is a potent neurotoxin, making it a cause for concern in the shop. Even fine particles in the air that contain manganese can be harmful. These toxins can be absorbed in an employees’ blood through the lungs and cause damage to the central nervous system.

It is also important to note that exposure to manganese may lead to a progressive neurological syndrome, called manganism. Symptoms may include:

•    Impaired motor skills and coordination
•    Hyper-irritability
•    Nervousness
•    Hallucinations
•    And more…

If a mechanic in your shop is experiencing such things, he or she should see a doctor.

It is clear that antiknock agents are not worth messing around with! As an employer, it is your duty to educate employees on these gasoline additives and make sure that all are taking the proper safety measures to avoid the worst case scenario.

At Wolpert Insurance, we understand that our main goal is to provide comprehensive and affordable garage insurance solutions to you, but we take our services a step further. We enjoy educating garage owners in the state of Massachusetts by answering FAQs and more. Be sure to come back next week for another informative blog post!

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Does OSHA Really Require Employers to Keep MSDSs for 30 Years?

We are back again with another great question! Our garage insurance agency enjoys being a guru in the auto body and garage business. We sincerely hope that you enjoy our knowledge, questions, and answers, as well.

This week’s question:

Are employers REQUIRED to hold on to material safety data sheets for 30 years?

This question is often up for debate. This week, Wolpert Insurance is here with the answer.

NO, you are not required to keep MDSDs for 30 years. HOWEVER, you ARE required to keep some record of the identity of the substance or agents to which employees are exposed to, for at least 30 years. If you choose NOT to keep the actual material safety data sheets, you will need to have the following information on the chemical:

•    Chemical Name
•    Info on where and when it is used

This information must be recorded and held onto for a minimum of 30 years. Of course, if you want to keep MSDSs, that is great! These sheets are accepted as a form of record. Honestly, this may be the easiest way to follow OSHA regulations. You may even want to consider purchasing a good electronic MSDS management tool. This is an easy way to make sure you are in compliance with all OSHA standards. To learn more, please check out the OSHA website, here.

At Wolpert Insurance, it is our goal to provide you with information that matters. We understand that you are busy as the owner of a garage and auto body shop, which is why we take the time to do the research and relay information and updates to you. Be sure to come back soon – we are always updating!

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How Does Garage Liability Insurance Factor In When Third Parties are Involved?

If you own a local and independent auto shop, you may not always have the resources your customers are looking for. Sure, you can change tires, oil, and maybe even replace the transmission. But what about other services your customers request such as new upholstery, a new radiator or alignments? It’s difficult to turn customers away because you rely on their business. As a solution, you may outsource certain work to third party vendors that are too complicated and expensive for your local shop. However, have you ever thought about what happens when a third party vendor you work with damages the customer’s car? Who pays for the damage? Does the vendor or does it come out of your garage insurance? Let’s take a look at a specific scenario:

Let’s say you outsource a job to partner, and this job involves your partner repairing the radiator. They finish the job and give you back the customer car. A few weeks later, this customer crashes their car due to a malfunction that was committed while the car was in the hands of your partner. So who does this fall on? If you have garage liability insurance, your coverage will normally kick in if the customer suffers an injury during the crash. Since they trusted you with their vehicle, your insurance will receive the claim.

However, you should shift the burden of these claims to the party to whom you outsourced the work. This is a three step process:
1)    Execute a hold harmless agreement with the shop performing the work wherein they agree to indemnify and hold you harmless for all claims arising out of their negligence.

2)    Request that you be added as an additional insured to their policies whereby suits filed against you, as in the example above, can be transferred to the other shop’s insurance carrier who will be responsible for providing your defense and paying any claim on your behalf.

3)    Request a certificate of insurance to evidence that steps one and two have been completed and so that you will know which insurance carrier to contact for claims and their policy numbers you will need as reference.

At Wolpert Insurance & Risk Management we know how confusing things can get when you own an auto garage. Massachusetts is not always an easy place to own a business, so we want to make sure you’re getting everything you need at all times. Give us a call today to learn more!

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Right to Know Law: Training Requirements

Over the past month, we have zoned in on the Right to Know Law. This is an important law to be familiar with – especially as the owner of an auto body repair shop and garage. If you have missed the first few blogs, do not hesitate to look back! If you have been following right along, it is about that time to wrap it up.

To wrap this discussion, we will be discussing training requirements.

Truth be told, auto mechanic training is not the ONLY training that your employees will need. According to the Right to Know Law, employees who are being exposed to chemical hazards must be trained ANNUALLY. There are a few guidelines to be aware of…

1.    If you have a new employee, the initial training must be done within 30 days of their hire date.

2.    You must keep record of this training. It should include: A description of the training given, the date of the training, and the names of the instructor and employees who attended the training.

3.    The record MUST be kept for the duration of the employment.

As for the training itself, there are always a few guidelines. For one, it must address a summary of your employees’ rights under the Right to Know Law. Also, it should include information on how to read a material safety data sheet (MSDS.) Last but certainly not least, the training MUST inform the employees of specific hazards and safe work practices for avoiding such hazards. This is essentially the main point of the training! If you are not careful, you may be filing a claim on your garage insurance much sooner than later.

To conclude, our agents hope that you not only realize how important the Right to Know Law is to your field and industry, but we hope that you have a full understanding of it as well. As always, if you have any questions or concerns, you should contact our agents at Wolpert Insurance. We would be happy to give you better insight!

Thank you so much for reading this series and please, come back for more!

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