Dear Valued Agent/Broker Partner,

As a trusted partner, we strive to identify issues that can impact the experience of our mutual customers. With this, we work to limit any potential risks and coverage gaps.

The global pandemic has changed many routines in both our personal and professional lives. With the rise of remote work, employees are no longer relegated to one physical location, and we believe this is a trend that is here to stay.

An email with these same key messages will also be sent to our policyholders later today.

During our auditing process, we are finding that employees of many of our insureds are not only working from different locations but, in some cases, are moving to different states that were not contemplated at the time coverage was placed. Additionally, some insureds are hiring new employees in new states, not realizing that this could create exposures for their companies as coverage is provided only for the states identified on the policy.

Additionally, adding employees in new states creates notification and reporting obligations for the employer. These changes have a direct effect on insurance coverage, as each individual state has its own rules and regulations regarding notification of work and claim handling practices. Many states will implement a fine if they are not notified that the insured has begun business in their state. Additionally, the number of days allowed for notification varies by state.

What can you do?

• It’s important that we work together to proactively reduce the risk of coverage gaps and fines for our mutual clients.
• We are asking that you work with your insureds to request updated address information for their employees and update their insurance policies based on this information as soon as it is received.
• Knowing about any additional state exposures will help to reduce the possibility of coverage gaps and fines.
• On our end, when you notify us that an insured has employees in new states, we will extend coverage for those new states effective on the date that we are notified and will adjust the premium accordingly.

As always, we appreciate your business and are here to answer any questions that you may have. Please contact your underwriter directly for additional information.

Dave Kuhn, CPCU, ARM
Regional President, California and Southwest Region
Executive Vice President, Enterprise Distribution