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These articles were prepared for the October 11, 2000 edition of
U.S. 1 Newspaper. All rights reserved.
To Lower Risk, Don’t Get Quoted
Learn how underwriters assess risk and you can lower
the cost of your business insurance, says Paula Gould of Paula
Gould Consulting Inc. on Harris Road in Princeton Junction. Gould
counsels business owners on how to make their risk profiles more
by instituting certain procedures and processes. She presents a panel
entitled "Risky Business: Managing Risk as You Grow Your
for the Princeton Chamber’s Business Council on Wednesday, October
18, at 7:30 a.m. at the Nassau Club on Mercer Street. Cost: $21. Call
Also on the panel are Jim Proferes, Philadelphia-based assistant
worldwide product manager for directors & officers insurance, Chubb
Insurance; and Brian Mohen, managing director and specialty
broker, Arden Financial Services. The moderator is Harold A.
Jerry III of Jerry & Jerry LP.
"Our focus will be on types of insurance that provide enhanced
levels of protection," says Gould. These policies can cover the
shareholder, the employee, the contractor, the owners, and the board
members, or they can focus on regulatory or antitrust issues. They
against claims alleging mismanagement.
as architects, engineers, accountants, lawyers, consultants, and
and health care providers — against client claims.
to advise on insurance and risk management services. An alumna of
Kutztown State and the College of Insurance in New York City, she
was an insurance broker for Marsh & McLennan in Manhattan for 20
and both placed and sold insurance, including property and casualty.
She spent the last two years selling insurance against wrongful acts,
such as D&O (directors and officers’ liability), employment practices,
and errors and omissions leading to malpractice.
She was a senior vice president when the company had a merger and
offered a good package, so she left and started her own business
quality of life issues," she says. "For me, it has been the
most creative time since high school — when I studied cello and
voice, played drums in the marching band, and was in every sport that
girls could play." As a consultant, she does not sell insurance,
but instead advises businesses on gaps and limitations in their
and risk management programs (609-799-6584; fax, 609-799-6754,
Here’s an example of why a consultant can be useful. You may be
to combine insurance on employment contracts with your D&O liability
policy. Gould may advise against it, depending on the dollar limit
of the policy, because — if you end up defending numerous employee
suits — you could be out of coverage when the time comes to defend
yourself personally. "You may not want to share your limits,"
To impress the underwriters, consider what they look at when they
assess your company. They look for:
base much of their pricing on the strength of the financial statements
they are given, because that is how they analyze the management."
are in place to achieve the business goals.
solid potential growth for a minimum of three to five years.
financial information might be limited. So the underwriters look at
the track records of those who support the company.
and firing on paper to avoid wrongful termination suits.
running the company is a good one.
with a very high profile. "They pull up Lexis/Nexis and see how
many times you have been quoted in the paper. If you are controversial
or have high visibility, that makes your company a greater target
for claims. Impressive press is great press? Not necessarily,"
it is more what is said by or about them that is important to the
underwriter. Some companies do not have the control they should over
who says what to the media and how it is stated. Underwriters do look
at the media to see which companies have sound risk management
for their media events and which do not. It all gets weighed into
the pricing of the risk’s premium."
One of Gould’s former clients, a religious not-for-profit, was so
visible and controversial that she was unable to locate a company
to issue a D&O (directors and officers) liability policy. "They
had had a lot of discrimination issues over the years. The
wanted $300,000 for $1 million of coverage. They were convinced by
the number of times the organization had been in the paper and the
types of issues that were raised, that someone would sue for
Difficult areas include the field of higher education. It has a
for being litigious, she says, perhaps because colleges and
had tenure policies before other industries.
"Now the high tech area is a growing area of high claims,"
says Gould. Service agreements for hardware and software vendors can
provoke litigations because what is sold is ultimately not suitable
for the purposes for which it was intended. In one instance, a
service provider of electrical wiring — which claimed to be a
specialist in the area, knowing what has to be done and how to do
it — hired subcontractors to do the work in government building.
The job had to be totally redone after 14 months because the work
was not to code, resulting in litigation on who should pay for the
High tech companies are often vulnerable because of their personnel
practices. "The companies are young and don’t have formal
They hire and fire at will, require long hours, and do a lot of flying
by the seat of their pants. People get disillusioned when the stock
goes down, and they sue."
— Barbara Fox
The Eastern Paralyzed Veterans Association (EPVA)
is making its new pamphlet, "Guide To Handicapped Parking in New
Jersey," available to the public via its website (www.epva.org)
or by calling a hotline, 800-444-0120. The pamphlet highlights the
most important provisions of the New Jersey Parking Law, including
the requirements to use reserved handicapped parking spaces and the
enforcement of them.
It also includes information about the correct identification of
handicapped parking spaces; the zones in which a handicapped parking
permit or license plate may not be used; and, the responsibility of
business owners to provide reserved handicapped spaces.
entries for its annual Sales and Marketing Awards now through Friday,
December 15. The awards recognize builders and their associates who
have made major contributions to the home building industry.
Winners will be honored at the annual gala banquet in Atlantic City
on Tuesday, April 3, which kicks off the 52nd Atlantic Builders
For more information on the SAM Awards, call Joy Miccio at
Thanks to the Thomas A. Edison Project
web browsers can view over a quarter of a million of the inventor’s
documents, including lab notebook sketches, patent applications,
and court room testimony. The online documentary edition, part of
a Rutgers University project that has been in progress for almost
30 years, serves as a research tool that enables users to organize
data electronically by name, date, document, or topic.
When completed, project researchers will have captured about 10
of Edison’s archives for publication on the Internet, on microfilm,
and in books. The Edison Project is supported by more than 60 public
and private foundations, corporations, and individuals, with recent
grants from a division of the National Archives.
The Small Business Administration offers a new office
and website to help women business owners get federal contracts
It is a joint project with such organizations as the National Women’s
Business Council and is the official gateway to more than 100
and acquisition sites hosted by federal agencies. The page links to
three registries for federal contracts: PRO-Net, Central Contractor
Registration, and Electronic Posting System.
This very deep and complete website also has special pages on getting
started, getting subcontracts, locating forecasts of future work,
lists of best practices, and a calendar of events. As of October,
Sheryl W. Swed will be in charge of federal contract assistance
for women business owners in the office of government contracting.
Latina entrepreneurs are becoming a rapidly-growing
business segment, according to a Wells Fargo-sponsored survey
for the National Foundation for Women Business Owners entitled
of Enterprise: Latina Entrepreneurs in the United States."
The survey included Latino women who have owned their business for
an average of 12 years, and of those women, two-thirds were born in
the U.S., and one-third are immigrants who have lived in the U.S.
an average of 30 years. It revealed that the 382,400 Latina-owned
firms in the United States in 1996 generated sales of $67.3 billion
and employed 671,200 people.
Corrections or additions?
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— the web site for U.S. 1 Newspaper in Princeton, New Jersey.