Up until now, popular opinion and interpretation within the hospitality industry suggested a portable lift could comply with the regulations if utilized correctly. However, because some U.S. Department of Justice (DOJ) employees had stated that portable lifts could be impermissible under any condition, lodging advocacy organizations such as the American Hotel & Lodging Association (AH&LA) as well as many state lodging associations, have been persistently urging the DOJ to clear up this issue.

The DOJ weighed in on these inquiries and issued what some are calling, including the AH&LA, a “burdensome interpretation” of when and how lifts need to be installed at swimming pools under the revised ADA guidelines. Although the DOJ did not specifically address spas, the principles as set forth in the DOJ guidance could apply to spas as well.

According to the DOJ, swimming pools and spas in lodging properties must come into compliance with the new ADA accessibility regulations to the extent such modification is “readily achievable.” Because this language is purposefully ambiguous, each business owner or operator must determine whether modifying the property is something they could do without significant difficulty or expense. What does that involve? It means taking the following issues into consideration:

• The nature and cost of the action;

• Overall resources of the site or sites involved;
• The geographic separateness and relationship of the site(s) to any parent corporation or entity;
• The overall resources of any parent corporation or entity, if applicable; and
• The type of operation or operations of any parent corporation or entity, if applicable.

According to the AH&LA, the DOJ’s explanation of what is “readily achievable” makes clear that no lodging facility will be able to determine whether it can rely on this defense. The DOJ states: “Determining what is readily achievable will vary from business to business and sometimes from one year to the next” and goes on to list some, but not all of the regulatory factors to be considered. DOJ did not mention that “legitimate safety considerations” are to be considered in the “readily achievable” analysis.

What does this mean for your hospitality insureds?

With only three weeks away from the compliance deadline, it’s imperative that hotel owners and operators that haven’t yet met these standards look at their cost-benefit, risk-reward analysis to determine what needs to be done at their particular property. What’s more, it’s important that you discuss this issue with them to make sure they’re properly insured.

An underwriter needs all the information at his/her fingertips when evaluating an account for exposures, coverage limits, rating, etc. This means receiving a summary of the account, a completed Acord form, and any supplemental information. It also means including three- to five-year loss runs with details on large claims. What also makes a thorough submission is having the incumbent agency details, the date by which the broker needs the declination/acceptance and premium amount, and the carriers that the agent has approved. And, of course, if possible, a 60- to 90-day lead-time is helpful so that smart and profitable underwriting can be accomplished.

Also, depending on the coverage line, additional forms may be needed. For example, for Fiduciary Liability insurance, a Form 550 (financial statements of a pension plan) is essential to the underwriting process. With EPLI, it’s absolutely essential that an underwriter knows the number of locations, number of employees, the type of employees, whether the employees are union or not, what type of losses have occurred in the past, among other key factors.

Providing complete submissions expedites the underwriting process, eliminating a lot of back and forth – which ultimately helps the agency close the sale on a new account. Also, thorough submissions is part of the overall transparency needed between agent and wholesaler, MGU, and carrier. It serves all parties and helps the broker develop a greater book of business with the partner he/she relies on to write accounts.

In 2011, Miami, and many major cities across the country, the vacancy rates lowered, compared to 2010. These trends seem to be continuing as we’ve entered the first quarter of 2012. Areas in the U.S. with the lowest multifamily vacancy rates currently are Minneapolis, Minnesota, New York City, and Portland, Oregon, all at or below 2.8 percent.

Some Reasons for the Trend

The increase in apartment rentals is in part due to the number of homeowners going into foreclosure in 2011, and needing to find alternative housing. Additionally, fewer people are able to afford to buy, with an upswing in the number of people seeking available, multifamily rental housing.

What’s more, the consensus around the U.S. is that credit continues to be very tight, making it increasingly difficult to borrow money to buy residential income properties or to refinance existing loans. The biggest criteria people face is not only how much they can put down and how much outstanding debt they already have, but also the ability to illustrate ongoing income to be able to afford to pay their mortgages.

IPOAUSA provides a number of insurance markets for Apartments, offering brokers the ability to increase their footprint in this growing sector. Give us a call toll-free at 877-653-IPOA (4762) to discuss what we can offer you and your clients.

And although there are uncertainties stemming from the Supreme Court’s Wal-Mart ruling  – posing challenges for companies and their defense counsel in terms of how to defend against accusations stemming from such large class action suits – some feel that this decision has already sparked more of these types of cases against other employers. The cases are with a smaller number of plaintiffs banding together to sue.

An organization of Wal-Mart’s size and structure makes it difficult to prove discrimination practices across the board, from one store to the next, as the Supreme Court stated in its ruling. But workers are fighting for what they allegedly believe they are owed, in terms of wage increases, fair promoting practices, sufficient pay for overtime and rates for holiday hours worked, in addition to alleged discrimination practices.

Meanwhile, employers continue to look to other avenues to address these types of alleged grievances, including handling cases in arbitration on an individual basis. But, while it is estimated that more than 20 states have legislation that permit class actions in arbitration disputes, the Supreme Court ruling basically says the federal statute overrules those laws.

With employee lawsuits on the rise, Employment Practices Liability insurance is increasingly more important, especially in industries such as Hospitality, where wage and hour filings are common. Insurance Programs of America has quality markets for this type of coverage, and we would be happy to discuss with you how we can help you provide your clients with a solution that is part of their overall insurance and risk management program. Get in touch with us at 407-260-8200.

“The new rules usher in a new day for the more than 50 million individuals with disabilities in this country,” said Thomas E. Perez, Assistant Attorney General for Civil Rights. “The rules will expand accessibility in a number of areas and, for the first time, provide detailed guidance on how to make recreation facilities, including parks and swimming pools, accessible.”

The amended regulations contain many new or expanded provisions on general nondiscrimination policies, including the use of service animals, the use of wheelchairs and other power-driven mobility devices, selling tickets for wheelchair-accessible seating at sports and performance venues, reserving and guaranteeing accessible rooms at hotels, and providing interpreter services through video conferencing.

In addition, those in the Hospitality Industries will need to ensure that the reservations staff of a hotel or a third party can identify accessible features in guest rooms (e.g. guest room door widths and availability of roll-in showers) and other hotel amenities in sufficient detail so that an individual with a disability can make an independent assessment whether the hotel meets his or her accessibility needs.

These are the first major updates to DOJ’s regulations from 1991. They are based on accessibility research, changing times, new knowledge, and other factors. The updates reflect also changes that respond to advances in ways of communicating, new technology, as well as new types of mobility devices, such as Segways, and increasing requests for a variety of animals to be considered service animals.

Talk to your Hospitality clients to make sure their covered for any potential liability based on these new regulations. IPOAUSA provides Hospitality insurance programs for operations across the country.

The good news is that those clubs that invest in new programs and lifestyle reap the rewards. An example of this is in the growth of clubs that are tied to residential communities, those that put an emphasis on family, fun and fitness. They have a competitive edge and will continue to do so. The entire family can enjoy a vacation where golf is available along with a myriad of other activities for the children.

On the global market scene, development outside of our country has experienced the same growing pains we have with an oversupply in markets that are unproven. According to online publication Golf Course Industry, “many new project planners and investors have not identified audiences with adequate depth and breadth to sustain start-up and standalone enterprises.”

How about growing the game? In December, Jack Nicklaus, the World Golf Hall of Fame member and golf icon, announced that he will join the PGA of America and industry leaders at the 59th PGA Merchandise Show in Orlando, Florida, to launch Golf 2.0, golf’s new strategic plan to grow participation in the game. The show takes place January 25-28, with the Golf 2.0 presentation on Thursday, the 26^th.

Golf 2.0 and its initiatives is aimed at helping all sectors of the industry expand participation, increase revenue, and build the vitality of the game for future generations. According to the PGA Merchandise Show, the goals of Golf 2.0 are to increase participation from 27.1 million golfers generating $33 billion in annual consumer revenues today to 32 million golfers and $35 billion in consumer revenues by 2016. By 2020, the goal is to have 40 million golfers generating $40 billion in annual revenues.

At IPOAUSA, we’ll continue to keep you in the know on the industries we serve to help you when speaking to your insurance clientele.

Looking to the future

According to Technomic, a leading foodservice research and consulting firm, here are some of the developments we’ll see in 2012:

• Comfort food with a twist will be served up, with innovations on the sandwich, pizza, and pasta
• Fresh ingredients with less expensive meat cuts, beans, grains, and produce to produce home-style food
• Local sourcing will continue, with growers, manufacturers, distributors and operators working toward a more transparent, safe and efficient supply chain, streamlining workflow, recording every step and reducing waste
• Social media will continue to influence consumers as to where they eat, looking up review sites like Open Table and sharing experiences on Facebook, Foursquare, Google+, and other networking sites
• Feed me information – consumers want to know how many calories they’re eating, allergens on menus, local-sourcing practices
• Brands will expand via flexible formatting, as restaurants cater to new around-the-clock day-parts, shifting gears from fast-casual by day to full-service at night, or transform their kitchens into catering commissaries during slow times

The National Restaurant Association surveyed 1,791 American Culinary Federation member chefs in October-November 2011, asking them to rate 223 individual food items, beverages, cuisines and culinary themes as a “hot trend,” “yesterday’s news,” or “perennial favorite” on restaurant menus in 2012. The NRA’s “What’s Hot in 2012” list includes:

• Local sourcing (topping the list) for meats, seafood and locally grown produce
• Healthy, nutritional food for children follows close behind local sourcing
• Meals that are gluten-free and allergy conscious also rank high, concurring with Technomic’s findings above
• Food trucks are still in vogue, with more than six out of 10 (61%) of the chefs saying they would consider launching a food truck as an entrepreneurial business venture
• Consumers are looking for smaller-portioned meals
• When it comes to technology, about one-quarter of the chefs (26 %) ranked smart phone apps as the hottest technology trend in restaurants in 2012, and another quarter (25%) said tablet computers (i.e. iPads for menus and wine lists) will be the top technology trend. Sixteen percent said social media would be the top trend, and the same percentage said mobile/wireless/pay-at-the-table payment options, while 4% said QR codes

We at IPOAUSA will continue to keep you updated not only on insurance issues but also relevant information regarding the industries we serve.

The MarketScout report shows that in November, Commercial Property was up 2%, Business Income was up by 1%, BOP by 2%, General Liability by 1%, Commercial Auto by 1%, Workers Comp by 1%, and EPLI by 1%. Some lines were flat for November: Inland Marine, Umbrella/Excess, Professional Liability, D&O Liability, Fiduciary, Crime, and Surety. Other released reports, including Marsh’s Benchmarking trends, backed up these findings, which showed that almost 50% of all U.S. Property renewals in the fourth quarter (as of December 1st) experienced rate increases.

The increases we see in the various lines, of course, make sense. The property insurance market, for example, has seen significant catastrophic claims this year, with an estimated $70 billion in losses for the first three quarters. As we discussed previously, the cost of Workers Comp is going up with a number of state funds across the country increasing their rates and private insurers following suit. EPLI claims are on the rise, with an increase in wage-and-hour lawsuits. In fact, the Department of Labor reported there were 40,000 wage-and-hour complaints in 2010. Discrimination suits are also getting a lot of attention, with significant exposure and costs for employers and their businesses.

The D&O market is one of the lines, however, that has remained flat. The uptick in claims frequency has not resulted in a rise in premium or restricted coverage yet, due to overcapacity and everyone fighting over the same premium dollars.

As Rates Firm, Access to Various Markets Matter

With IPOAUSA, what makes us so unique is that we have access to various markets in the niches we write, including Hospitality. As one of our niche agency partners, we can look for cover for your accounts and diverse risks with various markets, included admitted with carriers such as Travelers, Montgomery, Fireman’s Fund, and Chubb for $1-million-plus homes and commercial lines. We have established direct access to these national standard carriers, which write business with us in all states.

What’s more, we also work with most E&S Markets, and have an in-house program specific for Hospitality. All of this provides you with options, especially critical as underwriting discipline becomes increasingly important and rates begin to inch up. You need a partner that can provide you with alternatives to take care of the needs of your customers, and to expand your footprint in the niche you serve. That partner is IPOAUSA.

What’s more, we work with several A-rated, admitted and non-admitted carriers – quoting everything from property policies with wind, package x-wind, package, or even a BOP. We offer Umbrella/Excess Liability insurance with limits from $5 million up to $100 million. Our Surplus division includes products for large layered properties, coastal and earthquake exposed risks, monoline windstorm, wind-buy backs, excess flood, and builder’s risk.

When you partner with us, you get a wholesaler that understands the complexities of the dynamic hospitality industry. We keep up to date with how the industry is affected by various issues, including economic influences, the state of the insurance market, regulatory changes, catastrophes, consumer trends, and much more. We look at how these issues can affect an insurance and risk management program, and work with you to make sure your clients’ assets are protected. In fact, through our blog, we will continually keep you abreast of industry changes and trends in the hospitality sector.

You can be assured that during all market cycles – soft and hard – IPOAUSA and the companies with which we partner are committed to the hospitality industry and providing you with the suite of insurance products required to help protect clients from losses. Our objective has been – and will always be – to balance underwriting discipline and profitability with a market that our agents can rely on. We’ll also put our experience to work to negotiate competitive prices for your clients, which is becoming increasingly important, as we are now beginning to experience the firming of rates throughout our industry.

For more information, please call us at 407-260-8200.

Here it is the end of 2011 and indeed we have seen that average renewal premiums in three of four lines of business as tracked by the RIMS Benchmark Survey™ increased in the third quarter, strongly suggesting that an eight-year period of falling commercial insurance rates is at its end. According to the RIMS Benchmark Survey™ that tracks changes in average program renewal premiums for director & officers liability, general liability, property and workers’ compensation as reported by risk managers, of the four lines, only D&O posted a decrease, falling 1.9 percent. The average renewal premium increased 1.2 percent in general liability, 1.6 percent in property and 2.1 percent in workers’ compensation. These are modest increases, which reflects what Dr. Hartwig had discussed last late year.

Nonetheless, we are beginning to see the market firming. This is further underscored in Workers Compensation where the NCCI reported that there are 19 state funds that have increased rates or are looking for rate hikes. Private insurers are also following suit. Dr. Robert Hartwig estimated that approximately 25% of all premiums written have evaporated over the past five to six years. Loss of associated payroll, a prolonged soft market, aggressive pricing, the increased popularity of large deductible programs, captives, and self-insurance alternatives have all taken their toll on the Workers Comp market. A shift is now taking place with carriers wanting to turn things around.

With rates rising and premiums set to increase, albeit not in the way they had during the last hard market (after 2001-2002), along with stricter underwriting, looking for competitive markets with strong carriers committed to the niche you serve will be critical. Insurance Programs Of America is strongly positioned to provide the markets needed for our niche agents. We have three distinct divisions that cover the Standard Markets, Surplus Lines, and Programs. Whether you need access to an admitted market, have a complicated risk that requires the surplus lines market, or are focusing on program business for the hospitality industry, IPOASUA will work with you to find cover.