Expanded Info on the 126 Questions to Ask Your Insurance Agent - Question 61

Question For Your Agent #61 - Am I covered for the loss of trade secrets if an employee goes to a competitor?

This question is designed to promote a conversation about risk management. Loss of trade secrets is not covered by most insurance policies. Even your employee dishonesty coverage excludes such, as the loss is not to tangible property.

While there are specialty (read, "expensive") programs out there with limited coverage for loss of trade secrets, your best bet is internal security and contractual protections. Speak with your employment law attorney about what can be done to prevent others from profiting from the work and the innovation you paid for.

Frankly, this is a tough area. Most states restrict impinging on a former employee's ability to work by use of noncompete agreements. Confidentiality and trade secret agreements may be an option. Insurance really isn't going to help you.

Talk with your attorney.

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Expanded Info on the 126 Questions to Ask Your Insurance Agent - Question 16

Insurance buyers often tell me that they are too confused by insurance to even know what questions to ask. I have at least a partial solution in my white paper, 126 Questions to Ask Your Insurance Agent. Here is one of the questions and some background on what you get as an answer:

Question #16 - What's your biggest concern with our insurance program?

This is an open ended question designed to get your agent talking about his level of understanding and concern with aspects of your insurance. Even the simplest insurance plan has, within it, complex issues. There may be coverage questions that the agent has brought up in earlier meetings - perhaps years before. This is the agent's chance to bring them up again.

Agent: "Well Bob, last year we talked about employment related practices coverage. You decided not to buy the insurance. Perhaps that was the right decision. However, you still have the exposure of an employee or former employee accusing one of your managers of harassment or discrimination. I'm concerned with the money you would have to spend even on a groundless suit."

Underlying all the questions in my white paper is an analysis of the abilities and work your agent does for you. How comfortable are you with your agent? Is he paying attention to you and your needs? Are you comfortable with his efforts on your behalf? Is this agent the best agent for you?

Download your free copy of 126 Questions To Ask Your Insurance Agent

Employee Dishonesty Gap In Coverage

Employee dishonesty coverage is purchased to protect from (oh surprise) the dishonest acts of employees.

--The bookkeeper steals from petty cash.

--A stockroom employee steals and sells off inventory items.

Most policies don't cover the theft, by an employee, of customer property. So, if you run a cleaning service, your policy may not cover you if an employee steals jewelry from a client. Any company where employees are in a customer's office or home may have this gap in coverage.

Check with your agent.