Author: Addi Sickels

A serious accident can put far more than this year’s income at risk. If a visitor is injured, a delivery vehicle is involved in a crash, livestock leaves the property, or a farm activity causes damage beyond your property line, legal defense costs and a settlement can quickly exceed the liability limit on a farm policy. An umbrella policy adds another layer of protection after an underlying policy reaches its limit—but the right amount depends on your operation, not a one-size-fits-all rule.

Start With What You Could Lose

Begin by taking inventory of assets that could be exposed in a lawsuit: land equity, buildings, machinery, livestock, stored crops, vehicles, investments, and cash reserves. Also consider future farm income. Your umbrella limit does not necessarily need to equal every dollar of farm value, but a large difference between your net worth and liability protection deserves a deliberate conversation with your insurance professional and attorney.

Measure the Operation’s Risk Threshold

Risk rises when your farm has frequent road travel, employees, custom work, leased acreage, multiple entities, agritourism, direct-to-consumer sales, hunting access, boarding, manure application, chemical use, large livestock numbers, or regular visitors. Contracts may also require specific limits. Think beyond how often a loss might happen and focus on how severe the worst credible event could be. A low-frequency accident involving several people can produce a much larger claim than a common property loss.

Choosing $1 Million, $3 Million, or More

A $1 million umbrella may be a starting point for a smaller, lower-traffic operation with limited payroll, modest road exposure, few visitors, and assets that are reasonably aligned with total liability protection. Confirm that underlying farm and auto policies meet the umbrella carrier’s required limits.

A $3 million umbrella may fit a growing or diversified farm with employees, several vehicles, significant land or equipment equity, livestock near public roads, custom operations, or routine public interaction. It creates a larger buffer when one incident could injure multiple people or involve prolonged litigation.

Limits above $3 million merit consideration when the farm has substantial assets, a large workforce or vehicle fleet, high visitor volume, hazardous activities, contractual obligations, or ownership structures that create broader exposure. Higher limits may also be appropriate when several risk factors overlap. Ask for quotes at multiple levels; the incremental premium for added umbrella capacity may be modest compared with the protection gained.

Review the Limit, Not Just the Price

Review liability limits annually and whenever you buy land, add employees, expand trucking, open the farm to guests, sign a major contract, or start a new enterprise. Give your agent a complete picture of all entities, vehicles, drivers, locations, and activities so coverage gaps can be identified. The goal is not to predict the exact size of a future claim; it is to choose a limit that lets the farm withstand a severe event without threatening the family’s long-term plans.

This article is for general educational purposes only. Coverage availability, exclusions, and requirements vary by insurer and jurisdiction. Consult a qualified insurance professional and legal or financial adviser about your specific operation.

Sources

• National Association of Insurance Commissioners, “What’s an Umbrella Policy?” — explains that umbrella coverage can pay covered liability and legal-defense costs beyond primary policy limits.
• Insurance Information Institute, “What Is an Umbrella Liability Policy?” — describes how umbrella coverage applies after underlying liability coverage is exhausted and notes that insurers commonly require minimum underlying limits.
• Penn State Extension, “Farm Owner’s Insurance” — identifies farm-specific factors to review with an insurance professional, including acreage, livestock, machinery, stored crops, rental property, and transportation exposures.
• Penn State Extension, “Understanding Agricultural Liability” — outlines liability exposure tied to farm property, visitors, tenants, and operators, and recommends operation-specific advice from an attorney and insurance agent.

This article is not intended to be exhaustive, nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel or an insurance professional for appropriate advice.

Brought to you by: Dimond Bros. Insurance

Employee Medical Benefits: Self-funded vs. Fully Insured

Group medical benefit plans typically fall into one of two categories: self-funded or fully insured. The choice of one over the other should not be made arbitrarily. Each type carries its own set of administrative rules and legal constraints.

What is Self-funding?

Under an insured health benefit plan, an insurance company assumes the financial and legal risk of loss in exchange for a fixed premium paid to the carrier by the employer. Employers with self-funded (or self-insured) plans retain the risk of paying for their employees’ health care themselves, either from a trust or directly from corporate funds.

Most employers with more than 200 employees self-insure some or all of their employee health benefits. Many employers with fewer than 200 employees also self-fund, but these employers require greater stop-loss insurance protection than larger employers (stop-loss insurance is discussed in greater detail later). As a general rule, employers with fewer than 100 employees fully insure their group medical benefits.

The risk assumed in either situation is the chance that employees will become ill and require costly treatment. When employees have few claims and few expensive illnesses, the self-funded employer realizes an immediate positive impact on overall health care costs. Conversely, if the employee group has unfavorable claims experience, a self-funded employer would incur an immediate expense beyond what may have been expected. Insured plans have a more predictable cost for the year; however, large employee claims costs from one year can affect future premium amounts.

ERISA vs. State Regulation

Self-funded health plans are governed by the Employee Retirement Income Security Act of 1974 (ERISA). ERISA preempts state insurance regulations, meaning that employers with self-funded medical benefits are not required to comply with state insurance laws that apply to medical benefit plan administrators. On the other hand, insured plans must comply with some of ERISA’s requirements, but are primarily governed by the state where covered employees reside.

The distinction between state and ERISA regulations is important when determining if self-funding is right for your organization. Multi-state companies with insured health plans must comply with the regulations of each state in which they have plans and covered employees. Multi-state self-funded plans need only comply with ERISA.

Premium vs. Unbundled Fees

The risk an insurance company takes with an insured plan can be translated into a dollar amount for the employer. That dollar amount is the premium an employer pays each month for the insured group medical benefits. The premium amount includes the following:

• Current and predicted claims cost

• Administrative fee

• Premium tax paid to the state

• Insurance company profit

Employers who self-fund their medical benefits do not pay the premium tax or insurance company profit. They do, however, assume the costs of paying for claims and administrative functions. Typically, employers with self-funded health plans will outsource plan administration to a third-party administrator (TPA) or insurance company who charges the employer a fee for performing administrative services.

Stop-loss Insurance

Employers with self-funded health plans typically carry stop-loss insurance to reduce the risk associated with large individual claims or high claims from the entire plan. The employer self-insures up to the stop-loss attachment point, which is the dollar amount above which the stop-loss carrier will reimburse claims. Stop-loss insurance comes in two forms: individual/specific stop-loss and aggregate stop-loss.

Individual/Specific Stop-loss Insurance

This protects a self-funded employer against large individual health care claims. Essentially, it limits the amount that the employer must pay for each individual. For example, an employer with a specific stop-loss attachment point of $25,000 would be responsible for the first $25,000 in claims for each individual plan participant each year. The stop-loss carrier would pay any claims exceeding $25,000 in a calendar year for a particular participant.

Aggregate Stop-loss Insurance

This protects the employer against high total claims for the health care plan. For example, aggregate stop-loss insurance with an attachment point of $500,000 would begin paying for claims after the plan’s overall claims exceeded $500,000. Any amounts paid by a specific stop-loss policy for the same plan would not count toward the aggregate attachment point

Nondiscrimination Rules

Nondiscrimination rules require employers to offer employee benefits that do not favor certain employees. Employers with insured plans do not have nondiscrimination rules for group medical benefits, provided they follow the policy requirements of the sponsoring insurance carrier. However, employers with self-funded plans are required to comply with nondiscrimination rules. Generally these requirements are not difficult to meet, but failure to comply can result in some employees having their benefits treated as taxable income.

Employers with either type of group medical plan are required to comply with certain reporting and disclosure requirements, usually by providing tax and other pertinent documents to the United States Department of Labor or to their particular state.

Typically self-funded plans are required to provide copies of plan communications such as summary plan descriptions (SPDs) and summary of material modifications if the plan language changes.

Employers with insured plans that require employee contributions must file certain financial documents with the IRS. IRS filings are also required of self-funded plans, including Form 5500 and any accompanying documents.

This Benefits Insights is not intended to be exhaustive nor should any discussion or opinions be construed as professional advice. © 2015, 2018 Zywave, Inc. All rights reserved.

In commercial insurance, successful renewals do not happen at the last minute. Success comes from the right actions and communications from the service team. For you, one of the methods we use to manage the renewal is through our renewal strategy meetings.

We do not consider your policy expiration to be a deadline, rather a road map. Your service team reviews accounts that are 120 days from renewal on a consistent basis, which works to the service team’s and your advantage. They are then able to be prepared to face the changes and challenges that the renewal brings and are able to take advantage of the new business opportunities.

Your team forms an overall renewal strategy at the 120-day mark. We look at where the best options for coverage and pricing are, as well as service and retention, and whether that best option is with your current carrier or whether we start the marketing process. If your business has recently changed significantly, we may recommend a stewardship meeting to review these changes. From that meeting, the service team will define what information is needed and how carriers and/or brokers will be contacted, along with other tasks and preparations for the meetings.

As renewal gets closer, we start collecting new information about your business, which could be changes to payroll, revenue, locations, vehicles, equipment, or how your business functions. We analyze your past claims and look for patterns that will inform your coverage. This also helps us understand what enhancements to coverage may be necessary.

At 60 days prior to renewal, your account is assessed by the marketplace. We correspond with insurance carriers and respond to underwriting requests to create the best options for you. We do this in order to get the process started for you and maximize the time leading up to renewal to present you with options and answer your questions as we finalize your coverage.

The last 30 days prior to your renewal are about option presentations and answering any final questions before we lock in coverage. We have all of the heavy lifting out of the way at this point to aid you in making the best-informed decisions concerning your insurance program.

Having your broker come to you months before renewal helps reduce surprises. With a more predictable cycle, better, easier coverage decisions are the result. Clients appreciate brokers who come prepared, and it helps to create a successful partnership.

The true measure of a broker is not how they react to the last-minute renewal deadline. It is how they operate in the month to months leading up to it that will create actual value during renewal. It takes strategic planning, communication, and preparation to create a consistent experience and better, stronger protection each year.

This article is not intended to be exhaustive, nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel or an insurance professional for appropriate advice.

Preventive Maintenance for Coastal Properties

Coastal properties face unique challenges due to their proximity to the sea. Harsh weather conditions and saltwater corrosioncan impact the longevity and safety of coastal homes. Since home insurance typically excludes damage due to negligence ornormal wear and tear, proactively addressing these issues is crucial.

Wind Damage
Coastal areas are prone to powerful winds. To mitigate potential wind damage to your home, consider installing impact-resistant windows and doors to help prevent breakage during storms. Ensure your roof is securely anchored and considerhurricane shutters for additional protection from flying debris.

Saltwater Corrosion
Salt air can accelerate the corrosion of metals and other vulnerable building materials. Choose fiberglass, vinyl or PVC forsiding, trim and windows, as these materials are generally less susceptible to saltwater damage. Use stainless steel wherepossible. Consider applying protective coatings to guard against rust and corrosion.

Humidity and Mold
High humidity levels can foster mold growth, posing health risks and damaging your home. Use dehumidifiers and airconditioning systems to maintain optimal interior humidity levels. Reduce indoor moisture by fixing plumbing and roof leaks,as these can increase indoor moisture levels.

Termite Infestation
Termites can cause severe structural damage over time. Look for signs of termite activity, such as small holes in wood or visibledroppings. Hire a reputable pest control company to conduct routine inspections and provide treatment.

Choose Durable Finishes
Traditional paint may not withstand coastal conditions. Choose natural finishes, such as stone cladding or stained wood forbetter weather resistance.

Landscaping
Selecting native plants can help simplify maintenance while supporting your local ecosystem. Native plants may require lessupkeep and are typically adapted to the local climate, reducing water and pest control needs.

Secure Appropriate Home Insurance Coverage
Ensure you have flood insurance, as standard homeowners’ policies exclude this crucial coverage. You may also need windstorm insurance to provide appropriate protection against common perils in your area. Contact your agent for personalized home insurance quotes, including additional policies and endorsements.

This article is not intended to be exhaustive, nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel or an insurance professional for appropriate advice.

The past few years have seen a rapid expansion in artificial intelligence (AI), with many businesses leveraging this technology to automate workflows and administrative tasks, analyze vast amounts of corporate data, and enhance customer service offerings. However, as more businesses integrate AI-powered tools into their operations, this technology is also posing unique exposures.

Complicating matters, many standard commercial insurance policies were written before the widespread adoption of AI. In response, a growing number of insurers have begun updating policy language and, in some cases, introducing certain coverage exclusions for AI-related risks. Consequently, businesses that neglect to review these policy changes could face considerable coverage gaps and unanticipated out-of-pocket losses when claims arise.

This article provides more information on common AI-related exclusions in the commercial insurance landscape and offers associated guidelines for policyholders to keep in mind before renewal.

Common AI-related Exclusions

Exclusions for AI-related risks have emerged across several lines of coverage in the commercial insurance space, including the following:

• Commercial general liability (CGL)—In recent years, many liability policies were largely “silent” on AI-related exposures, making the extent and scope of coverage for such losses relatively ambiguous. Effective January 2026, the Insurance Services Office (ISO) introduced multiple generative AI exclusion endorsements for its CGL coverage forms. Since most insurers utilize ISO-based forms, carrier adoption is expected to increase steadily throughout the CGL segment. In practice, these endorsements may exclude coverage for third-party bodily injury, property damage, and personal and advertising injury losses stemming from generative AI outputs.
• Professional liability/errors and omissions (E&O)—Alongside the rising prevalence of exclusion endorsements for AI-related risks in the CGL space, the E&O segment has demonstrated some of the most aggressive exclusion activity toward these exposures. In particular, some insurers have introduced broad exclusions that eliminate or significantly restrict coverage for losses tied to AI-powered professional services or advice. This is especially concerning for businesses that leverage AI tools (e.g., chatbots) in client-facing operations.
• Directors and officers liability (D&O)—In the D&O space, some insurers have started implementing exclusions for certain AI-related exposures and using more restrictive policy language regarding AI governance risks. One of the top concerns in this segment is claims stemming from AI-washing, in which companies are accused of overstating or otherwise misrepresenting their AI usage or the capabilities of this technology to investors and the general public. As a result, insurers are placing greater scrutiny on AI-related disclosures during the underwriting process, and policy language may continue to evolve to address these risks.
• Fidelity and crime—Standard fidelity and crime policies generally exclude coverage for cyber fraud, particularly for social engineering attacks that involve honest employees being manipulated by cybercriminals into transferring company funds to external accounts. This exclusion also applies to AI-enabled fraud, namely deepfake plots and business email compromise scams, as these incidents usually don’t qualify as “direct theft” under traditional policy terms. To combat these exposures in the fidelity and crime space, businesses may need to purchase social engineering or fraudulent instruction endorsements. Even then, specific coverage capabilities will depend on the nature of the incident and the type of fraud involved, with some insurers implementing strict sublimits and security requirements.
• Cyber—Unlike other lines of coverage, insurers in the cyber segment are largely affirming rather than excluding claims stemming from AI-driven losses. While businesses may still need to secure endorsements for certain events (e.g., social engineering schemes), standard cyber policies typically cover losses resulting from cybercriminals using malicious AI programs to penetrate corporate networks, expose confidential data or deploy automated ransomware attacks. Nevertheless, cyber insurance does not apply to bodily injury and property damage losses, which could leave businesses with ongoing coverage gaps if their other policies fully exclude AI-related risks.

Guidelines for Policyholders

In light of these evolving exclusions, it’s critical for policyholders to review their coverage before renewal and take steps to prevent potential gaps. Here are some key guidelines to consider:

• Document and disclose AI usage. Businesses should conduct a detailed inventory of their AI usage across their operations, including standalone tools and those embedded within third-party software platforms. This inventory should be well-documented and shared with insurers during the underwriting process. Failure to disclose the full extent of AI usage could give insurers grounds to deny associated claims or rescind coverage moving forward.
• Review policy definitions and limitations. Rather than focusing solely on the declarations page of their policies, businesses should carefully review these documents in full, especially the exclusions section, for AI-related restrictions that might otherwise be missed. Businesses should also note how AI is defined in their policies to determine whether this language is broad enough to cover losses stemming from routine or incidental AI use. When applicable, businesses should request copies of any AI-related endorsements for their CGL, E&O, D&O and other liability policies, thereby ensuring full comprehension of what is and isn’t covered.
• Explore additional coverage options. Businesses should never assume they have sufficient coverage for AI-related exposures just because their cyber policies affirm these losses. Cyber insurance rarely fills other liability coverage gaps, especially for businesses with significant E&O exposures. Businesses struggling to secure adequate protection against AI-related risks under standard commercial policies should consider purchasing specialized AI liability coverage. Yet, it’s worth noting that these offerings are still evolving and remain somewhat limited. In any case, businesses can consult trusted insurance professionals to discuss their unique coverage needs.

Conclusion

As AI continues reshaping business operations, its insurance implications grow increasingly complex. Policyholders must proactively review their coverage, disclose AI usage and work with insurance experts to remedy ongoing gaps before they become costly surprises. Staying informed and adaptive is the best defense against future AI-related claims. Contact us today for additional insurance guidance.

The content of this article is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel for legal advice. TRUE Network. All Rights Reserved.

On June 4, 2026, the Departments of Health and Human Services, Labor, and  the Treasury, together with the Office of Personnel Management, published a final rule (the “Final Rule”) revising the federal independent dispute resolution (“IDR”) process under the No Surprises Act (the “NSA”).

Background

Enacted as part of the Consolidated Appropriations Act, 2021, the NSA generally protects patients from surprise medical bills for out-of-network emergency services, certain non-emergency services furnished at in-network facilities, and out-of-network air ambulance services. These protections generally took effect January 1, 2022.

When neither a specified state law nor an applicable All-Payer Model Agreement determines the payment amount, the parties may use federal IDR following a 30-business-day open negotiation period. If negotiation fails, either party generally may initiate IDR during the following fourbusiness-day period. Each party submits an offer, and a certified IDR entity selects one after considering the qualifying payment amount (“QPA”)  and properly submitted information concerning the other statutory  factors. The QPA generally is based on the median contracted rate for the  same or a similar item or service in the applicable insurance market and  geographic region, adjusted for inflation.

Key Considerations

Expanded disclosures. Effective August 3, 2026, plans and issuers must provide the QPA and related information with an initial payment or notice of denial even when the provider’s billed amount, rather than the QPA, is used to calculate participant cost sharing. The

disclosures must also include the legal business name of the selfinsured plan or issuer, the plan sponsor’s legal business name, and the plan’s or issuer’s federal IDR registration number once assigned. The Final Rule also requires plans and issuers to use specified claim

adjustment reason codes (“CARCs”) and remittance advice remark codes (“RARCs”) on paper and electronic remittance advice sent to noncontracted entities. Under subsequent agency guidance, plans and issuers must use the specified RARCs for items and services

furnished on or after January 1, 2027.

Portal-based negotiation and eligibility review. Once the necessary portal functionality is available, parties will submit open negotiation notices, responses, and supporting documentation through the federal IDR portal. The receiving party must respond by the 15th

business day of the 30-business-day negotiation period. A certified IDR entity generally must determine eligibility within five business days after its final selection. These requirements will apply to disputes with open negotiation periods beginning 90 days after the agencies

announce that the supporting functionality is available.

Batching and bundled arrangements. The Final Rule permits batching when qualified IDR items or services involve a single patient encounter billed on the same claim form, the same or comparable service codes, or specified anesthesiology, radiology, pathology,

and laboratory services within the same Category I CPT code range identified in agency guidance. A batch may contain no more than 50 qualified IDR items or services, and the cooling-off period for batched disputes decreases from 90 calendar days to 30 business days. The Final Rule separately defines a bundled payment arrangement,

which may be submitted as a single payment determination and is not generally subject to the batching requirements. The agencies have announced that the revised batching provisions will apply to disputes with open negotiation periods beginning on or after

November 1, 2026.

Lower administrative fee. The nonrefundable administrative fee decreased from $115 to $15 per party for disputes initiated on or after June 11, 2026. Beginning August 3, 2026, a party that does not timely pay the administrative fee or, for an eligible dispute, the certified IDR entity fee will not have its offer considered and will remain liable for

the unpaid fee.

▷ Federal IDR Registry. Self-insured plans, issuers, and Federal Employees Health Benefits Program carriers subject to federal IDR will be required to register and obtain a federal IDR number. Fully insured group plans will not register separately from their issuers.

Registration will be due by the later of 90 business days after the agencies announce that the registry is available or the date the plan or coverage becomes subject to federal IDR. A TPA may register for a self-insured plan, but the plan remains responsible for compliance.

Registration information must be updated within 30 calendar days after a change and confirmed annually during the fourth quarter.

Employer Impact

Federal IDR activity has substantially outpaced the agencies’ projections. Although the agencies initially estimated that approximately 22,000 disputes would be initiated during the first year of implementation, CMS reports that more than 6.3 million disputes were initiated between April, 15, 2022, and May 31, 2026. This continued growth highlights the potential financial and administrative significance of the federal IDR process for employers sponsoring self-insured plans. In light of the Final Rule, plan sponsors can begin by confirming that their TPAs have implemented the disclosure requirements effective as of August 3, 2026, and are preparing for the November 1, 2026 batching changes and

January 1, 2027 RARC requirements. Other near-term priorities include assigning responsibility for federal IDR registration, gathering the required plan-specific information, and reviewing the plan’s QPA methodology before the current enforcement relief expires on October 1, 2026.

Administrative services agreements also warrant review to address IDR notices, payment authority, fees, reporting, registration, and responsibility for missed deadlines or inaccurate submissions.

Conclusion

Employers sponsoring self-insured plans should coordinate with their TPAs to implement the Final Rule’s phased requirements, prepare for registration and portal changes, and establish regular oversight of IDR activity. Because delegation to a TPA does not eliminate the plan’s compliance obligations, continued monitoring of agency guidance and the pending TMA III litigation remains important.

For more information regarding the No Surprises Act, please contact Mike Holley, Vice President of Life & Health for Dimond Bros Insurance, at mike.holley@dimondbros.com

The content of this article is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel for legal advice. TRUE Network. All Rights Reserved.