Article I
ARE YOU REQUIRED TO HAVE LONGSHOREMAN INSURANCE? WE CAN HELP YOU DETERMINE IF YOU NEED IT OR NOT? MAYBE YOU ARE GOING TO DO CONTRACT WORK WITH A LARGER COMPANY THAT REQUIRES IT.
We can issue Certificates of Insurance quickly once we have your Longshoreman Insurance in place.
THIS IS WHAT OUR PROGRAM DOES FOR YOU
The Longshore and Harbor Workers' Compensation Act provides employment-injury and occupational disease protection to approximately 500,000 workers who are injured or contract occupational diseases occurring on the navigable waters of the United States, or in adjoining areas, and for certain other classes of workers covered by extensions of this Act.
These benefits are paid directly by an authorized self-insured employer; or through an authorized insurance carrier; or, in particular circumstances, by a Special Fund administered directly by the Division of Longshore Compensation.
In addition to longshore, harbor, and other maritime workers, LHWCA covers a variety of other employees through the following extensions to the Act: The District of Columbia Workmen's Compensation Act (enacted in 1928 and repealed effective July 26, 1982); Defense Base Act (1941); Non appropriated Fund Instrumentalities Act (1952); and the Outer Continental Shelf Lands Act (1953).
The Longshore Compensation Act provides over $747 million in monetary, medical and vocational rehabilitation benefits in more than 27,000 cases annually for maritime workers and various other special classes of private industry employees disabled or killed by employment injuries or occupational diseases. In addition, the Longshore compensation program maintains over $2.8 billion in securities to ensure the continuing provision of benefits for these injured workers in cases of employer insolvency. Claimants depend upon timely receipt of these benefits to provide food, housing and a minimal standard of living for themselves and their families.
MONETARY AND MEDICAL BENEFITS
The Longshore and Harbor Workers' Compensation Act, administered by the U.S. Department of Labor, provides medical benefits, compensation for lost wages and rehabilitation services to longshoremen, harbor workers and other maritime workers who are injured during the course of employment or suffer from diseases caused or worsened by conditions of employment. Several other statutes extend the provisions of the Act to cover other classes of private-industry workers. These include workers engaged in the extraction of natural resources of the outer continental shelf, employees on American defense bases, and those working under contracts with the U.S. government for defense or public-works projects, outside of the Continental United States.
During FY 2005 in excess of $747 million in compensation and medical benefits will be paid in approximately 27,000 cases covered under these compensation acts. These benefits constitute the only source of income for many families. Medical benefits provide the treatment necessary to recuperate and return to gainful employment when timely provided.
The Longshoremen's and Harbor Worker's Compensation Act can provide both compensation and medical benefits to employees who were engaged in maritime employment.
Article II
What You Don’t Know About Longshoreman Insurance Can Leave You High And Dry!
When a PEO’s client, a welding company, received a call to perform a two-day job, it seemed quite run-of-the-mill, nothing out of the ordinary. However, while on the job, one of the employees, unfortunately, got sparks in his eye, resulting in lost sight. On his road to recovery, you received the dreaded letter from the claimant’s attorney — a demand for permanent partial disability loss in the amount of $133,718, which was about four times the permanent partial disability award in your state. Not the best news for your large deductible plan! Wondering how that could happen, you continued to read on and discovered a reference to Longshoremen’s and Harbor Worker’s Compensation Act. Uh, oh!
“What’s that?”
A simple job, like welding handrails onto a riverboat, could leave you high and dry and deplete funds from your company bank account unnecessarily.
The covered injuries and diseases benefits are somewhat similar to the benefits provided by the states. A notable difference is that the willful act of a third person, directed against an employee because of his employment, is covered under the U. S. L. & H. Act. Otherwise, coverage is provided for any accidental death or injury occurring within the scope of employment, except for the death or injury due to intoxication or willful intent of the employee to kill or harm himself, which is not compensable.
If your PEO has a client conducting work that has U. S. L. & H. exposure, you have serious reasons for concern. Generally, the benefits under U. S. L. & H. are substantially higher than the benefits prescribed by states for similar injuries. For example:
The total temporary maximum weekly benefit is $835.74; the minimum is $208.94.
There is no time limit set to the disability. Payments continue for the duration of the disability, as claimed.
Sample income benefits for scheduled injuries include $203,921 for total loss of hand; $62,680, thumb; $171,326, foot; and $167,148, total hearing loss.
The time limit for income benefits to a spouse if a fatality occurs is unlimited, with a lump sum settlement two years after remarriage.
The U.S. Department of Labor administers the adjudication of claims for the Division of Longshore and Harbor Workers’ Compensation; appeals can make their way all the way to the U. S. Supreme Court.
From a risk management point of view, verify —with some urgency— that your present workers’ comp policy includes, at the very least, incidental U. S. L. & H. coverage specified in an endorsement. If an employee suffers a claim under this exposure, you could be liable for the difference in benefits between the state and federal levels. That could be quite an exposure! In addition, be very sure that you have a good grasp on the activities of your clients. A simple job, like welding handrails onto a riverboat, could leave you in dry dock.
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Article III
The 6 Dirty Secrets of Workers Compensation Insurance
(This information pertains to both your Workers Compensation and to your Longshoreman Insurance)
Dirty Secret #1 – Insurance companies don’t pay for your employee injuries, they just finance them for you at usury interest rates.
Do you realize that you pay $2 or $3 back to the insurance company for every dollar they pay out for your employee injuries? Each claim results in the most expensive financing contract you have in your business. You pay:
• For employee injuries through increased rates.
• Increased costs because your Experience Modification skyrockets.
• Lost productivity.
• Reduced morale for the unhurt employees who fill in for the injured employee.
• Increased stress for management and staff.
You have Workers Compensation for only two reasons:
• The law requires it.
• Worker's comp spreads the true cost of employee injuries out over time.
Work comp does not pay for employee injuries. You do!
Dirty Secret #2 – Claims Management Services are usually dreadful;
Now that you know you write the checks for your employee’s injuries (you can have more proof if you want it) you should realize how critical it is for you to demand “two thumbs up” claims management service. Claims adjusters are snowed under with too many cases. Your injured employee doesn’t get the attention he or she deserves. In spite of this, insurance companies continue to downsize as they strive to increase profits.
Add Managed Care to the mix and your employee’s claim is often outsourced to a case management company. The adjuster doesn’t even know what is happening or how your injured employee is being treated. You just can’t notify the insurance company your employee was injured and expect them to “do their job.” You must have a proven process in place to minimize the cost of the injury and expedite your injured employee’s return to work.
Dirty Secret #3 – You are penalized and overpay when the “Audit Police” make a mistake on an audit? Would you allow an IRS agent to conduct an audit without an expert on your side? Because your real insurance cost is determined after your policy expires, it is essential, the audit is correct.
You’re at a disadvantage from the start. The insurance company auditor knows the rules, you don’t. The auditor is not compelled by law to explain the rules, especially if applying a rule that would cause you to pay a lower premium.
Here’s how the auditor works against you:
Your entire payroll is put into the highest classification.
https://www.longshoremaninsurance.com or www.goharrisinsurance.com
Phone (205) 275-5005
Email: [email protected]
HOW MUCH IS LONGSHOREMAN INSURANCE, AND HOW DOES THE PROCESS WORK?
Small operations:
For a one to two person marine operation doing vessels or related USLH work or in need of a USLH or longshoreman insurance policy, how much is the cost? Typically, the annual premium is around $9,500 to $10,500 with a payment plan of 25% down, so say $2,500 down.
WHAT IS THE PROCESS TO GET USLH INSURANCE?
Here is how it works. A contractor or entity in need of a USLH policy will call (205) 221-5466 OR (205) 275-5005. Or, if one prefers email, then one may email [email protected] or [email protected] with an inquiry. We will email back to you a one page USLH Application form that one completes and emails back to us.
We will need to know your company name, address, FEIN or Federal Employee ID number, a description of past and present work, estimated annual sales and payroll, how many workers or employees, if any, other than the owner. We will also need a quick, one or two-page work resume that tells us what your past experience and technical education may be. We will need to know if you have a current workers compensation policy and if you have current general liability insurance. If not, then these are NOT disqualifiers. If you have current State Workers Compensation Insurance, we will need a copy of the policy declarations pages, not an Acord certificate of insurance from your current agent/broker/agency. What is a declaration page? It is the page that has your company name, address, coverage amounts and that sort of information.
We will gather all the required information from you and submit to our insurance companies and get you a quote. This will take anywhere from 1-3 days, depending on how busy the insurance company underwriters are at the time. Once we have the quote, we will email over to you the quote for USLH and State Act Workers Compensation Insurance. Usually the cost of State Act Workers Compensation is under $500 per year. The largest cost is the USLH policy. You will sign the documents and email those executed documents back to our firm, Old National Insurance, Inc. dba LongshoremanInsurance.com, and we will invoice you for the premium amounts. Once we have the premium monies collected, we can then issue the all-important Certificate of Insurance (COI) that is required by your shipyard, marina, contractor, government entity or other third party. The total process will usually take anywhere from 3-5 days depending on how quickly everyone in the chain of distribution works and gets the information back to us, and then we get back from the insurance companies. Our firm insures small firms, and we have larger firms with 300 employees or more insured. There is no size limit.
FLORIDA SMALL CONTRACTOR OPERATION QUESTION.
In this example, we have a small water-based contractor operation in Florida working to clean canals, bridges, and other near or in water structures. We considered the company operations of the contractor working with specialized equipment in and around water of minimum depths. Even though some or most of the water is fresh water and some brackish water, the water can flow to the ocean. Therefore, USL&H or Longshoreman Insurance would be required given the USL&H law. Some of the equipment floats and is considered a vessel and some of the equipment does not float and is like a specialized excavator with both pieces of equipment used to clean sludge, seaweed and debris.
In our risk analysis of the contractor operation, we recommended the following coverages:
1) WC (State Workers Compensation)
This is a “construction industry” type of risk. Florida Law requires Workers Compensation coverage even if there is only one employee. Even if one considers oneself to be an independent contractor, Florida Law considers one to be an employee and therefore is required by Florida law and needs to be covered in order to be compliant with Florida law.
2) USL&H (Longshoreman Insurance)
Doing this type of work, cleaning canals and working under bridges, etc., it is hard to NOT be working in a navigable waterway in Florida. If a contractor is working under bridges, in canals, etc., it looks very much like there are USL&H exposures. As an LLC, an owner is considered an employee of the LLC and cannot be exempted from USL&H coverage.
3) MEL (Marine Employers Liability)
If a contractor is working from a floating piece of equipment, this piece of equipment would be considered a vessel, i.e. capable of horizontal movement of men and materials on the water. So, it becomes a question of how much time is spent working in the water. If the time spent is greater than 30%, the contractor may move into Seaman status and require P&I (Protection and Indemnity) and Crew coverage. Even though the “CREW” is only one person.
4) MGL (Marine General Liability)
We recommend a package policy that includes both MGL and property/equipment coverage. Typically, a minimum premium for something like a standalone package is about $20K.
In Summary, on the surface it appears that this particular risk would require 4 types of coverage, State Act Workers Compensation, Longshoreman Insurance, MEL or Marine Employers Insurance and Marine General Liability to be fully protected.
Questions and Comments?
[email protected]
Text or Cell (205) 275-5005 USA
WHAT IS THE DIFFERENCE BETWEEN USLH (US Longshore and Harbor Workers Act) AND MEL (Marine Employers Liability)?
USL&H (US Longshore and Harbor Workers Act) is a specific type of insurance coverage mandated by federal law (The United States Longshore and Harbor Workers’ Compensation Act) covering a broad range of occupational injuries and illnesses. Longshore coverage is specific to employees working within the jurisdiction of the United States. Failure to provide this coverage can result in legal penalties of up to 5 years prison time and $250,000 fine per occurrence.
MEL (Marine Employers Liability) Insurance provides coverage for just about any liability an employer might have arising from injuries, illnesses, or deaths of employees where those employees are injured while in service of a vessel. The keywords here are “while in service of a vessel.”
If your company is in need or has any questions about these two type of marine insurance, Marine Employers Liability (MEL) or Longshoreman Insurance (USLH Insurance), LongshoremanInsurance.com has the answers for you and has been serving the marine industry for over 20 years. They can be reached by phone, text or email. The phone and or text number is (205) 221-5466, and the email is [email protected].