First Western Insurance | Home Business Basics

Homeowner (HO) policies aren’t meant to insure businesses that are run out of a home. Premiums paid for homeowners coverage are for handling losses related to the ownership and use of a residence and related structures. Therefore, no liability coverage is available for business activities such as customers who slip and fall on your premises, damage to business property (owned or in your control), injury caused by things you make (products liability), or damage due to services that you promote or provide. It is also unlikely that an insurer would provide a legal defense against business-related claims.

Generally, a HO policy does not provide workers compensation coverage for any employee. Medical expense and liability coverage may be available for workers who are ineligible for workers compensation, such as maids, butlers, or nannies, but such coverage only applies if an injury occurs while performing residential tasks.

Example: You send your nanny to deliver copies of your business proposal and, on the way to the client, she is seriously injured in a fall. Your policy won’t provide any medical expense coverage for your nanny because she was performing a business-related chore.

There is no coverage for detached garages, barns, or similar structures on your residence premises if they are used in whole or part for business.

Example: You store $3,000 worth of equipment and supplies that you use in your job in your garage and the garage burns down. The fire loss to the garage becomes ineligible because of its partial business use.

A basic HO policy may protect certain property. However, the coverage may be limited to as little as a few hundred dollars. Items qualifying for limited coverage include business personal property kept in or around your home, business personal property kept at a location other than in or around your home or landlord’s furnishings. One way to improve your coverage is to add policy options that do the following:

• increase the coverage limits for business personal property
• cover garages and other buildings that are rented to others
• protect electronic business equipment which is usually used in a vehicle while such equipment is located outside of a vehicle
• provide theft coverage for landlord’s property
• acquire limited business personal property and liability coverage for an in-home daycare
• cover a condo unit owners’ liability for damage caused by renters
• provide premises liability coverage (i.e. a customer slips and falls)

If you run your business out of your home, please contact a First Western Insurance agent to ensure you’re covered. 

COPYRIGHT: Insurance Publishing Plus, Inc. 2020. All rights reserved. Production or distribution, whether in whole or in part, in any form of media or language; and no matter what country, state or territory, is expressly forbidden without written consent of Insurance Publishing Plus, Inc.

How are increased patterns of natural disaster claims impacting my property insurance coverage?

By: Mark Koller, First Western Insurance Claims Manager

This is an understandable question for homeowners who have not had a recent claim. Yet, premiums are increasing, deductibles are increasing, and coverages are being decreased.

Increased premiums and reductions in coverage are the result of:

        • The Midwest has experienced higher-than-normal level hail and wind storms over the past several years. These storms have been unpredictable and costly in nature.
        • Repair costs have increased significantly due to increased costs of construction materials and labor.

Many of the insurers have lost significant amounts of money on property insurance. As a result, insurance companies are increasingly doing the following to ensure profitability:

        • Increased deductibles that require the homeowner/business owner to pay a larger portion of the loss.
        • No longer offering Replacement Coverage (RC) and replacing it with Actual Cash Value (ACV) coverage based on the age of the policyholder’s roof. There is an indication that replacement cost coverage will be extremely difficult to find in the near future.
        • Excluding cosmetic damage from wind and hail. This often applies to metal roofs that are visibly dented from hail but still functional as a roof.
        • Completely exiting out of writing homeowner’s coverage – several prominent insurers no longer write homeowners’ property insurance.

Our team is here to help you navigate through the rapidly changing property insurance marketplace. We are dedicated to providing valuable information and answering any questions you may have. Our main goal is to ensure our insureds have the best coverage at the most competitive rate available.

If you have any questions or need assistance, please don’t hesitate to reach out to one of your local First Western Insurance agents.


By: Shelby Ford, First Western Insurance Agent

“Why are my insurance premiums increasing?” A question being asked by many clients as we are seeing the insurance market continuing in an upward trajectory, more than it has in the last 20 years. There are many factors that have contributed.

So what is causing all of this, you may ask?

Catastrophic Losses: We are experiencing record amounts of natural disasters today. From hurricanes, floods, and wildfires, these storm frequencies and the increase in severity have a direct impact as they all lead to property damage.

Inflation: Times of high inflation can cause rate increases due to insurance companies experiencing higher claim payouts and operating costs.

Underinsurance: With inflation and the cost of materials increasing, clients are seeing an increase in their personal property, which can correlate with an increase in premiums. It is important to have accurate valuations for assets so you don’t come up short after a loss.

Property Replacement Costs: The cost to replace property is significantly higher than it has been. We have seen a 55% increase in the cost of structural steel and a 35% increase in the price of lumber. There are shortages in material and supply chain disruptions. The premium increase can help offset the increased replacement costs.

Though this information may sound daunting, there is value in knowledge and having an agency that is client-focused and transparent. Our team helps our clients prepare for these changes and can recommend assistance in budgeting for upcoming renewal terms. We are dedicated to providing valuable information and answering any questions you may have. Our main goal is to ensure our insureds have the best coverage at the most competitive rate available.

If you have any questions or need assistance, please don’t hesitate to reach out to one of your local First Western Insurance agents. 


Cyber Crime & Your Business

October 26, 2023

Cyber attacks are a significant issue for every risk manager and business with any computer device and electronic data. If you have not suffered a cyber incident such as a system hack, data theft or held hostage for ransom, or a phishing email scam, sit tight because the possibility is more significant than you might think. Your business may have, unknowingly, already suffered an incident.

Because of this, it is critical for a business to implement a robust internet security program and train employees on how to identify and report anything suspicious. Unfortunately, even with these programs, there is still a possibility of your network being compromised.

Breaching systems and stealing money and data is big business for cybercriminals and can devastate your business into bankruptcy. There are many expenses associated with a cyber incident, such as the cost to recover your data, legal fees, media mitigation, crisis management, and possible regulatory fines if employee or customer information is stolen.

Cyber insurance can help with these expenses, including fines and defense costs. Defense costs and penalties are usually within the policy limits, a deductible may apply, and there may be exclusions, such as war.

Most Cyber policies include the following coverages:

        • Security Breach Expenses
        • Affected Party Notification
        • Employee salary to handle inquiries
        • Affected Party Post Monitoring
        • Media Mitigation
        • Extortion
        • Data Replacement/Restoration
        • Business Income & Extra Expense
        • Security Breach Liability
          • Defense
          • Fines

Depending on the business operations, Cyber coverage may be added as an endorsement to your commercial package policy or as a separate policy. Many different endorsements may be available as well. Regardless of how coverage is obtained, though, it is essential to understand the policy coverages and exclusions.

When applying for cyber coverage, it’s essential to understand that the larger the coverage request, the more underwriting scrutiny will be placed on your current internet security and employee training programs.

Cyber liability risk is complex and dynamic. Therefore, businesses must include the need to address such risks in their regular business planning. Insurance is a risk transfer to protect your business from financial hardship, but even when you are insured, your business benefits when you take responsibility to prevent losses from occurring.

Since not all cyber policies and coverages are created equal, contact a First Western Insurance professional to discuss your business coverage needs.


COPYRIGHT: Insurance Publishing Plus, Inc. 2023

All rights reserved. Production or distribution, whether in whole or in part, in any form of media or language; and no matter what country, state or territory, is expressly forbidden without written consent of Insurance Publishing Plus, Inc.

First Western Insurance Named a ‘Circle of Excellence Agency’ by Western National Insurance Group


(Minneapolis, Minn.) Western National Insurance Group today announced that Minot, N.D.-based First Western Insurance has been named one of Western National’s Circle of Excellence Agencies for 2023.

The Western National Circle of Excellence recognition is announced annually to spotlight an elite group of partners who have excelled based on performance and growth over the past five years (2018 – 2022). An agency must also demonstrate that they meet high standards of professional excellence and integrity in order to be considered for this recognition. First Western Insurance’s place among this list is a testament to the overall quality of the agency’s insurance professionals and their commitment to meeting the needs of their insurance clients.

This recognition places First Western Insurance in the 90th percentile of all Western National partners for overall performance, growth, and partnership over the past five years.

Western National Insurance, headquartered in Edina, Minn., is a super-regional group of property-and-casualty insurance companies. The Group writes business through five active insurance companies—Western National Mutual Insurance Company, Western National Assurance Company, Pioneer Specialty Insurance Company, Umialik Insurance Company, and American Freedom Insurance Company — and is affiliated with Michigan Millers Mutual Insurance Company. Together, the affiliated Group writes over $800 million in personal and commercial direct premium in 19 states across the Northern, Midwestern, and Western U.S. as well as in Alaska; and surety bonds in 38 states. All of the companies’ products are sold exclusively through professional Independent Insurance Agents.

Types of Cyber Attacks

Most cyber attacks start with a single series of “phishing” emails; this is a fraudulent attempt to obtain private information such as; usernames, passwords & credit card details. They disguise themselves as reliable sources.

Other types of cyber crimes include spoofing, pharming, business email compromise, and ransomware attacks.

Ransomware is the extortion of your computer system, holding it hostage with all of your accounts and systems locked until you pay the “ransom” to get your data back.

In 2020, over 187 million ransomware attacks were detected — by one security firm alone. Ransomware claims have increased four-fold from 2017 to 2019.

You should have Cyber Insurance if…

        • Your business relies on computer systems to generate or save critical information.
        • A hack could leave many customers’ information at risk and leave them open to fraud.
        • You maintain day-to-day operations as a storefront and need computer systems and customer information to complete transactions.
        • You do not want to risk reputational harm. If you do not protect customer data, you will lose trust and revenue.

You may have some coverage, but is it the RIGHT coverage for your business?

Many insurance policies have a small cyber insurance element, but frequently it isn’t the adequate amount of coverage to help your business survive an attack.

Cyber attacks happen at every type of business and every level; manufacturing, finance, non-profit organizations, school districts, retail & healthcare. Every business has a threat to incurring monetary losses or possible litigation if you did not protect a customer’s information.

Having the right cyber insurance and an insurance agent and agency that has the experience and understanding of how to help you is the key to avoiding large losses.

First Western Insurance: Cyber Security Presentation

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