Hartford Business Journal

HARTFORDBUSINESS.COM | March 6, 2023 31 Other Voices Make sure your business has adequate insurance to cover property, other damages By Julia Johnson Brinson R ecently, the Hartford Public Library and Mark Twain House & Museum in Hartford sustained unexpected property damage without proper risk management strategies. The library suffered significant water damage after a pipe burst over the Christmas weekend. The library is not expected to reopen until the summer. The Mark Twain House, on the other hand, was vandalized three times in December and early January, with windows and valuable artwork damaged. In both instances, the library and Mark Twain House were forced to resort to crowdfunding platforms to raise funds for repairs and restorations. Relying on crowdfunding after a loss begs the question of whether your organization has adequate risk management strategies. Risk management is the practice of identifying and analyzing loss exposures and taking steps to minimize the financial impact of the risks they impose. It does not appear the library or Mark Twain House allocated sufficient resources to accept and pay for the risk of water damage or vandalism, which explains the need to resort to GoFundMe to restore the properties. So, how can organizations protect their assets against unexpected losses so they don't have to resort to crowdfunding after a loss? For starters, organizations can transfer the risk to a commercial all-risk property insurer that covers losses arising from any accidental cause, except for those that are specifically excluded. Organizations should obtain adequate property insurance coverage to protect their physical buildings and the contents inside. They should also have an insurance professional review policy language to ensure that there are no limitations on the amount of coverage available to cover water damage during annual renewals. Organizations should ensure they have a healthy reserve on hand to cover repairs up to the deductible. Organizations, if applicable, should procure historic property coverage for properties built before 1950 that are listed on the National Register of Historic Places of a state or local register. Historic property insurance includes historic replacement cost, which is the cost to repair, rebuild or replace real property at the time of direct physical loss or damage with the same materials, workmanship and architectural features. If the same materials, workmanship and architectural features are not reasonably available, then insurers will pay the cost to repair, rebuild or replace the property with the closest reasonably available substitute. Organizations should also consider appropriate risk management strategies (particularly property insurance) for unexpected losses, such as water damage and vandalism. The cost of annual insurance premiums would be less than what would need to be reserved on the balance sheet for losses. Additionally, crowdfunding — which is an unreliable and unsophisticated way to mitigate unexpected losses — should never be the go-to strategy over sound risk management. Companies would be well-advised to review their insurance policies for adequate coverage rather than relying on uncertain community donations. All organizations will experience losses at some point in time. The goal is to have an adequate risk protection strategy in place so that there is certainty when the unexpected happens. Julia Johnson Brinson is vice president of insurance research at Hartford-based global investment firm Conning. CT must lift restrictive apprenticeship hiring ratios to fill open trades jobs By Jenn Jennings A s Connecticut's legislative session opened last month, the state is grappling with a number of public policy issues that will not only impact our short- term needs, but also our long-term economic success and ability to compete. Investment in our transportation infrastructure is long overdue; the pandemic exposed the need for improved air quality and filtration in our schools and workplaces; and climate change advocacy and use of more eco-friendly energy has strained our state's electric grid, fueling the need for greater energy efficiency and a smaller carbon footprint. There are positive signs — and investments — that demonstrate the state is trying to address these challenges. Tens of millions of federal dollars are flowing into the state to fix roads, repair bridges and modernize public transportation. This past September, Gov. Ned Lamont announced that $150 million in state funds — supplemented with an additional $165 million in federal COVID-relief funds — will be made available to upgrade aging and inefficient heating, ventilation and air conditioning systems in our public schools. Despite these positive developments, the state still faces headwinds. That's because addressing these challenges will require a qualified workforce of skilled tradespeople — including construction, electrical, plumbing, HVAC — and there's a well-documented shortage of qualified talent for these roles in Connecticut. Our workforce in the trades is graying and retiring in great numbers, and the next generation is ill-prepared to fill the void, leaving thousands of potential job openings in Connecticut. The skilled trades gap, however, is entirely self-inflicted by the state- restrictive apprenticeship hiring ratios, which allow only one apprentice to be hired for every three licensed individuals at a company. Among dozens of trade-based careers, this hiring ratio only applies to five — heating, cooling, plumbing, electrical and sheet metal workers. By comparison, the state's job-site ratio — designed to ensure workplace safety and adequate training — requires one licensed professional to supervise an apprentice while on the job. Eliminating the restrictive hiring ratio to match the 1:1 job-site ratio will continue to protect safety and adequate training of the industry while promoting workforce development, meeting consumer demand, servicing existing clients and growing Connecticut business. Staffing capacity limits Connecticut's hiring ratio is among the most restrictive in the nation and puts the state at a competitive disadvantage, particularly compared to neighboring states that all allow for multiple apprentices to be hired for every one licensed professional. While I applaud Connecticut's investment in its technical high schools, we risk losing young, trained talent to nearby states where apprenticeships are easier to secure. Connecticut's current hiring ratio is regulating competition, leading to fewer apprentices, higher prices and longer service wait times for Connecticut consumers. An August 2022 survey of Connecticut Heating and Cooling Contractors Association members found that 32% of respondents had stopped accepting new business because they lacked the staffing capacity to meet demand. To meet growing consumer demand, we need to ensure we're building that pipeline of talent — and providing the necessary on-the-job apprenticeships. Skilled trade careers can be a pathway to meaningful economic stability for many state residents, particularly for youth in our state's economically-challenged urban centers. A survey of the Connecticut Heating and Cooling Contractors Association's membership found that apprentices' hourly wages range from $20 to $27 an hour, and pre-apprenticeships for students from Connecticut's technical high schools pay $15-plus an hour, allowing students to earn income as the learn. By comparison, according to the National Center for Education Statistics, the average federal student loan debt for college students in 2022 was $37,574. Trade-based careers and apprenticeships can — and should — play a key role in leveling the playing field and providing economic mobility, while helping Connecticut improve its transportation infrastructure, public health, energy and create its carbon- neutral future. But that means removing the barriers to apprenticeship and eliminating the hiring ratio. Jenn Jennings is the executive director of the Glastonbury-based Connecticut Heating and Cooling Contractors Association. Julia Johnson Brinson Jenn Jennings OTHER VOICES

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