Insurance Insights ~ April 2001

Congress Repeals Workplace Rules

After the Occupational Safety & Health Administration (OSHA) enacted a new Ergonomics Program Standard that was effective January 16, 2001, Congress voted on Wednesday, March 7, 2001 to repeal these new workplace rules, which were aimed at curbing repetitive motion injuries. This was the first legislative accomplishment for business-friendly Republicans who won control of the White House and Congress last year.

The measure cleared the House on a largely party line vote of 223-206, less than 24 hours after Senate passage. Democrats and organized labor protested vociferously, but President Bush signaled he would sign it.

The regulations were aimed at reducing or preventing musculoskeletal disorders (MSDs), such as carpal tunnel syndrome, tendonitis and other health problems associated with repetitive motion, awkward postures, contact stress and other on-the-job conditions. The rules did not cover trips, falls or other on-the-job accidents.

The rules, strongly backed by organized labor, were issued shortly before former President Clinton left office. According to OSHA, MSDs currently cost the US around $50 billion per year. About $1 out of every $3 spent on Worker’s Compensation goes for MSD-related claims. Proponents of the Standard estimated that it would have generated over $9 billion of medical cost savings each year over the next ten years. However they could not estimate what the cost would have been to implement these standards.

When The Bough Breaks

The trees on your property are worth money -- from a few hundred dollars for a sapling to many thousands for a full-fledged shade tree. This face comes home with a crash when the homeowner loses a mature tree and begins the process of replacing it.
First, there’s the cost of removing the downed tree, grinding its stump, and restoring the land where the tree was uprooted ($200 to $2,000, depending on the time it takes to do the job).

Then there’s the decision to leave the area treeless, buy a sapling from one to two inches in diameter ($75 to $200 per inch) and wait for years to see if mature fully, or buy a mature tree and have it planted at prices than can range from $2,500 to $25,000. Using a crane and a mechanical tree spade mounted on a truck bed, contractors can transplant almost any size tree. To deliver large trees over local roads requires special permits. Despite the cost, few nurseries will guarantee a new tree’s growth. With care in transplanting, most trees survive, but there are too many variables to guarantee healthy growth.

Some financial help for removing and replacing a downed tree is usually available to your from the company that insures your home. And fiscal relief may be available from the Internal Revenue Service (IRS).

You can declare a casualty loss on your income tax for damaged or destroyed trees. The IRS does include hurricanes and tornados as damaging events, as well as earthquakes, floods, storms, volcanic eruptions, shipwrecks (hard to come by!), mine cave-ins, sonic booms, vandalism, fire, auto accidents, and smog. The IRS does not allow a casualty loss for insect damage, drought, or progressive deterioration. To collect, the loss must exceed $100 for each casualty, and the owner may declare a loss for amounts in excess of 10 percent of the adjusted gross income for the year in which the claim is made. There are other fine points in the casualty portion of income tax laws. Consult your tax advisor before making a claim.

Insurance may pay the expense for removal of fallen trees, which cause damage to covered property. A homeowner’s policy from Erie Insurance pays up to $1,000 per occurrence for the removal of fallen trees on the residence premises if loss is covered by windstorm, hail or weight of ice, snow or sleet even when covered property is not damaged by the fallen tree.

To replace trees, shrubs, plants and lawns, Erie’s homeowner’s policies provide an additional amount of 5 percent of the amount of insurance under the Dwelling coverage in addition to the debris removal. Coverage applies only to losses caused by the following: fire or lightning, explosion, sonic boom, riot or civil commotion, aircraft, vehicles, smoke, vandalism or malicious mischief, and theft. There is a limit of $500 per tree (claim the remainder of the allowed loss on your tax return). Check your policy for exclusions for commercially grown trees and vehicle damage by residents of the household. Since most tree and plant damage is wind-related, windstorm damage is not usually covered.

If a person destroys the tree -- a driver, pilot, or vandal -- there’s a change you can collect full damages. Put in a claim against the auto or airplane liability policies. You probably will have to bring a lawsuit against the vandal or mischief-maker. But to collect, you must have a professional appraisal of the tree, just as with the IRS or your own insurance company. You can probably check the yellow pages for reliable landscape architects and nurserymen to get a fair estimate to replace the tree. Arborists base appraisals on four elements: species, location, size, and condition. You would be wise to photograph each valuable tree and shrub on your property to be fairly compensated.

Before the bough breaks, check your homeowner’s insurance policy to see how your policy applies to these losses. Contact our office today to get a quote on your homeowner’s insurance today!

INSURANCE INSIGHTS is an electronic newsletter published monthly (except for January and August) by G. C. Weimer Associates, Inc. Information contained herein is accurate to the best of our knowledge and belief as of 4/1/2001. If you have a topic of interest for a future issue, e-mail us at info@gcwinsure.com.