The Americans With Disabilities Act calls for the owners of public pools to install lifts or underwater ramps to provide access for people with disabilities. Many in the hotel industry felt they could comply with the law by using portable lifts. However, this changed when the DOJ issued an interpretation of the law on January 31st, saying the law calls for permanently affixed lifts where feasible and affordable.

The cost for permanent lifts is between $2,500 and $6,500 each, plus installation. Pool manufacturers estimate that the law applies to about 256,000 pools and spas across the country. Only a small percentage of those pools are equipped with lifts, they estimate.

Hotels are now asking for more time to comply, up to twelve months. Hotel industry representatives have told Congress that they are concerned that permanent lifts left unattended may be a safety hazard for children, who will be tempted to play on them. The also need more time due to a backlog of orders for permanent lifts, making it impossible to meet the May deadline.

Kevin Maher, senior vice president of government affairs for the American Hotel & Lodging Assn., the trade group for the nation’s hotel industry, said: “It gives us an opportunity to work to assure we have the equal access to pools at all our hotels.”

Pool operators who do not comply with the regulations may be vulnerable to lawsuits, according to hotel industry experts. Some hotel owners in an effort to avoid lawsuits may close their pools if they aren’t in compliance by May 21^st.

Be sure to discuss this important exposure with your hotel clients. At IPOAUSA, we can help you with secure insurance coverages for the hospitality industry through various markets. We an also assist you in risk management for this sector. Please give us a call at 877.653.IPOA (4762).

As mentioned in last month’s blog, the program includes Property, Liability, Data Breach, Employment Practices, and Umbrella coverage lines. The program is available in all states on a non-admitted basis. Limits are available up to $20 million per location, and the target is for hotels built after 1987. There are no minimum premiums and a limited number of agency appointments for the program.

The coverage lines to be available soon include:

UMBRELLA

Coverage will be available from Torus for $5 million and $10 million limits and rated based on the number of rooms. The minimum premium is $1,500.00.

EPLI

Employment Practices Liability coverage will be available for wage and hour lawsuits, which is a huge issue in the hospitality sector. In addition, there will be a sublimit for defense and investigation as a result of INS action – especially critical for businesses operating in the border states, such as Florida, Texas, California, and Arizona – and for industries that rely on less skilled workers, thus facing a potentially greater incidence of immigration-related issues in their employment practices.

DATA BREACH

Through an exclusive arrangement with Beazley, a specialist insurer, IPOAUSA will make available Beazley Breach Response to limited service hotels, which is normally only available to large resorts. This coverage includes breach notification and credit monitoring services with separate coverage limits for third party claims; breach response coverage for forensic and legal assistance, and notification costs; bureau credit monitoring services; crisis management sublimit for public relations and extraordinary notification expense;  a separate limit of liability for privacy, network security and media claims; and more. There is a $100,00 PCI restriction.

IPOAUSA is focused on bringing products to its niche agents that address the challenges that certain industries and the companies that operate within these industries face. The hospitality industry is but just one example of how IPOAUSA is teaming up with the best in the industry to deliver protection solutions for your clients. For more information about the IPOAUSA’s new Hotel Program, contact Stefan Burkey at 877.653.IPOA (4762).

We spoke with Stefan Burkey, founder and CEO of IPOAUSA, about the newly designed program, its features, and immediate plans for expanded coverages lines. Stefan founded IPOAUSA after years of working on the retail insurance side, building a multi-million-dollar book of business in Hospitality with properties across the country.

“We wanted to provide our agency partners with additional markets that addressed the target class of limited and full-service hotels,” explained Stefan. “We’ve been so successful in the Hospitality industry with our Synergy of 3 Divisions, in which we offer agencies markets to place and write various types of risks in one place – whether it be through Admitted, Non-Admitted, or Excess & Surplus Lines – that we wanted to add to our portfolio. Lloyd’s provided us with its financial strength and an opportunity to design a program that addresses the specific needs of this hotel sector with key features that will be attractive for our agency partners to sell.”

The program is available in all states on a non-admitted basis. Limits are available up to $20 million per location, and the target is for hotels built after 1987. There are no minimum premiums and a limited number of agency appointments for the program.

This new hotel program includes the following key Propertyfeatures:

• Agreed Amount
• Backup of Sewers and Drains
• Business Income (ALS) with Ordinary Payrolls
• Cimicidae Infestation (bed bugs)
• Employee Dishonesty
• Equipment Breakdown
• Fire Department Service Charge
• Fire Protection Equipment Recharge
• Forgery or Alteration
• Lock & Key Replacement
• Money & Securities (on and off)
• Outdoor Property
• Ordinance & Law
• Personal Effects & Property of Others
• Trees, Plants, Shrubs
• Utility Services

In addition, within two months, the program will be expanded to include several key coverage lines, including an Umbrella with a $5 million and $10 million limit that’s rated based on the number of rooms. The coverage is through Torus, and has a minimum premiums starting at $1,500.00.

Employment Practices Liability Insurance (EPLI) will include coverage for wage and hour lawsuits, a risk that continues to outpace all other types of workplace class action lawsuits throughout the country. In addition, there will be a sublimit for defense and investigation as a result of INS action. “This sublimit is particularly important for operations in border states, such as Florida, Texas, California, and Arizona,” said Stefan. “What’s more, it’s really key for the hotel industry which relies on less-skilled workers, putting operations at a greater risk for immigration-related issues in their employment practices.”

Data Breach coverage for limited-service hotels will be available through an exclusive arrangement with Beazley. “The Beazley Breach Response program is normally only available to large resorts,” explained Stefan. “Through IPOAUSA, we are making coverage available to limited-service hotels. Included is breach notification and credit monitoring services with separate coverage limits for third party claims; breach response coverage for forensic and legal assistance, and notification costs; bureau credit monitoring services; and crisis management sublimit for public relations; a separate limit of liability for privacy, network security and media claims; and more. There is a $100,000 PCI sublimit.”  

IPOAUSA is licensed in all 50 states and provides insurance agents and brokers with flexibility and choice when it comes to finding markets for their customers. Through IPOAUSA, agents have access to one resource with the ability to place accounts in the various market alternatives available, giving them a competitive edge – even more important today as pricing in the industry is firming.

A suite of insurance products is available for these niche industries:

• Hospitality – Limited-Service Hotels, Resorts & Spas, Registered Historical Hotels, Restaurants, Golf Courses, Condominiums
• Apartments – Complexes, Management Companies, Development Firms
• Traditional Coastal/High-Valued E&S Placement

In addition, when working with IPOAUSA and its staff, agents not only get the markets they need, but they also have partners providing underwriting and risk consulting with a proven track record for success in the industries they serve. To find out more about this brand-new, exclusive Hotel program and each of the niche programs IPOAUSA offers, visit www.ipoausa, or contact Stefan at877.653.IPOA (4762).

Furthermore, the most recent Commercial Lines Insurance Pricing Survey (CLIPS) conducted by Towers Watson showed commercial insurance prices had increased by an aggregate 3% during the fourth quarter of 2011, representing the fourth consecutive quarter during which prices for all standard commercial lines rose. The data from CLIPS revealed what the MarketScout’s trends are continuing to indicate for 2012: Prices for workers compensation and commercial property showed the largest quarterly increases followed closely by general/products liability.

Does this mean the market is turning?

Well, yes, although not exactly in the way we’re used to from past market cycles, as previously discussed. But there is a consistent shift in the rise in rates each quarter even if increases are moderate. And, coverage lines such as D&O, which remained flat for seven consecutive quarters, is starting to show movement towards stabilization.

What’s more, according to the CLIPS data, price increases were observed across all account sizes for standard commercial lines, with the largest increases observed in mid-market accounts.

What does this mean for the industry, including agents and brokers?

The insurance industry has been waiting to see an upward trend in rates for some time now and a shift from a soft to a hardening market, albeit it’s on the “lite” side. This will mean stricter underwriting; a narrower scope of coverage and restrictions; players not as serious or new in certain niches offloading business; and an increase in commissions for agents and brokers and more agency growth, which has been below average. Plus, competition among agencies and brokers will continue to remain high even as the market firms up.

As the winds of change take place, IPOASA has the markets to help you serve your client base and increase new business through our Synergy of 3 Divisions, whether you’re looking for Standard Admitted Markets, Excess Surplus Lines, and Programs Business. Take a look at what we have to offer and give us a call at 877-653-IPOA (4762).

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.

“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.

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.