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DAS Canada
Session Objective
Our objective is to help you understand:
1. Common legal risks facing business owners
2. DASbusiness value proposition
3. Elements of coverage & claims examples
4. Claims process
5. Pricing & limits of indemnity
6. How to start the conversation with clients
2
DAS Canada
In Canada there are …
Sources: Statistics Canada, CANSIM Table 551-0006 as of June 2014 & CANSIM Table 282-0012 as of YE 2013
3
1.2 millionSmall businesses
(with 1-99 employee’s)
2.7 millionSelf-employed Canadians
DAS Canada
Of all those Business Owners…
1 out of 10Personally know another business owner who lost
their business due to a legal dispute
Source: 2015 DAS Canada & Ipsos Small Business Owner Research
4
DAS Canada
Hiring & firing staff Wrongful dismissal action
Signing contracts &
making deals
Contract disputes with
suppliers &/or customers
Maintaining an office or
job site
Property damage,
trespassing or bodily injury
Adhering to ever-changing
government regulations
Investigations by government
regulatory boards
Maintaining licensing
requirements
Statutory license
revocation
Keeping the tax man happy Tax audits by the CRA
Common Legal Risks
5
DAS Canada
Over The Past 3-Years….
3 out of 10Business owners faced a legal dispute whereby they
& the other party engaged lawyers to resolve
Source: 2015 DAS Canada & Ipsos Small Business Owner Research
6
DAS Canada
You own a retail business with two locations …
• Your lawyer advises you have a reasonable chance of being awarded $35,000 to
recoup costs associated with a supplier failing to deliver merchandise in a sellable
condition & on-time
• However, it would take 18 months and cost $15,000 in legal fees. Also, you may
face adverse costs if you lose your case, so the total potential bill could be
$30,000.
7
What Would You Do?
A. Walk away?
B. Cut back operating expenses?
C. Take a profit hit?
DAS Canada
The Value Proposition
We empower business owners when they face unforeseen legal issues.
A DASbusiness policy:
Allows your clients to defend or pursue their legal rights
Protects your clients from costly legal expenses
Gives them unlimited access to legal advice at any time
8
DAS Canada
It’s surprising that …
29%of business owners did not have legal representation
when going to court to resolve a legal dispute
9
Source: 2015 DAS Canada & Ipsos Small Business Owner Research
DAS Canada
Employment Disputes
11
We will pay legal costs for disputes related to:
• The dismissal of an employee
• An employment contract with an employee or ex-employee
• An alleged breach of statutory rights of an employee or ex-employee
DAS Canada
Employment Disputes: Claims Examples
12
Kate is a DAS policyholder who was sued for wrongful dismissal by one of
her ex-employees. The former employee alleged that he had been
discriminated against; he was seeking $40,000 in damages. Kate was
depressed, as she knew her business could not afford to pay $40,000.
Kate called DAS and a claim was opened. A DAS lawyer contacted the former employee, who agreed to
drop the case. Thanks to her DASbusiness policy, Kate avoided spending approximately $10,000 in legal
fees, if this had gone to court.
DAS Canada
Employment Disputes
Exclusions and conditions:
• An employee received oral or written warnings 180 days preceding policy inception date
• 180 day waiting period for a lay-off or job elimination
• 90 day waiting period for other employment disputes
• Any claims or disputes relating to:
• Business transfers
• Negotiation of a collective bargaining agreement or arising from a work disruption
• Due to death, illness, bodily injury and/or property damage
• $2,500 deductible for legal proceedings whereby a union is acting on behalf of a
unionized employee or ex-employee
13
DAS Canada
Legal Defence
15
We will pay your client’s legal costs to defend their business for:
• Investigations by occupational health and safety boards
• Notices of Investigation or Violation issued by the CRTC in relation to Canadian Anti-Spam
Legislation (CASL)
• Police investigations
• Criminal offences
• Breach of privacy legislation
• Appeal of statutory notice
• Civil action being taken against a trustee of a pension fund set up for the benefit or the
insured’s employees
DAS Canada
Legal Defence: Claims Examples
16
Donald is the owner of a large industrial supplies distributor, and tragically one
of his employees was killed during an accident at work.
DAS immediately appointed a lawyer to assist Donald with the resulting health and safety investigation, to
gather all the evidence and make submissions on his company’s behalf. The lawyer also defended the
supervisor on duty at the time of the accident, who was under investigation for potential criminal
negligence causing death. In the end no charges were pressed. This was an extremely complicated
matter, during an emotional time for Donald and his employees, and would have cost Donald’s business in
excess of $100,000 in legal fees, if he was not a DAS policyholder.
DAS Canada
Legal Defence
Exclusions and conditions:
• Breach of highway traffic laws or regulations in connection with the ownership, use,
or operation of a motor vehicle
• Specific sections within and/or appeals to the Federal Court or other courts with
respect to CASL
17
DAS Canada
Statutory Licence Protection
19
We will pay your client’s legal costs to appeal to a regulatory or statutory authority, court
or tribunal for:
• A suspension of a statutory licence
• A refusal to renew a statutory licence
• A cancellation of a statutory licence
DAS Canada 20
Statutory Licence Protection: Claims Examples
Brigitte and her husband Shaun own a golf course. At the start of the season, the
local health inspector visits the club house and 9th hole snack bar. He immediately
orders the them closed for food preparation and cleanliness bylaw violations and
suspends the restaurant operating license for 30 days. Brigitte and Shaun want to
appeal the suspension on the grounds the inspector’s decision was extreme in
relation to what they perceived as minor violations. Plus they immediately instituted
a training program for the large number of new staff that had started, and within
seven days, policies and training were in place to address the original violations.
Brigitte called DAS and we immediately helped by appointing a lawyer to appeal the inspector’s decision
and the restaurant’s operating licence was reinstated in less than 30 days.
DAS Canada
Exclusions and conditions:
• Original application or application renewal
• A licence appeal relating to a:
• Motor vehicle
• Professional licence issued to an individual
21
Statutory Licence Protection
DAS Canada
Property Protection
23
We will pay your client’s legal costs to pursue civil action relating to their physical
business property for:
• Physical damage to the property
• Legal nuisance
• Trespass
DAS Canada
Property Protection: Claims Examples
24
Jackson owns a popular café and next door a bar opens up. Over the next few
months, Jackson is faced with the problem of the bar’s customers parking in
front of his café. Plus rowdy and drunk bar patrons had fights in front of his café.
Jackson is seeing a drop in customer visits and sales, and his business
neighbour is refusing to do anything about it.
We helped Jackson by appointing a lawyer who drafted a letter to the bar owner requesting overflow
parking be stopped and unruly patrons be better managed. The letter requested a written response and
steps to be taken within 30 days or court action would start. After 30 days, no reply was received and there
was no change in patron activity. The DAS appointed lawyer started court action against the bar owner
seeking an injunction.
DAS Canada
Exclusions and conditions:
• A claim relating to a contract entered into by your client
• When a governmental, quasi-governmental, public, or local authority:
• Places restrictions or controls on your client’s property
• Legally takes your client’s property away from them
• Does work on their property
• Motor vehicles
• Defending your client’s legal rights, other than in a counter-claim
• Mining, subsidence, heave, or landslide
25
Property Protection
DAS Canada
Bodily Injury
27
We will pay your client’s legal costs to pursue legal action following a specific or
sudden accident which causes:
• Death, illness or bodily injury
DAS Canada
Bodily Injury: Claim Example
28
Victoria is the top sales rep from a small printing company. While on her client’s
premises, she trips and falls as a result of lose extension cords lying on the
ground. She suffers a concussion and neck injuries that keep her off work for 6
weeks. With their top sales rep out of action, the printing company’s sales drop.
Plus the company’s group benefits plan does not include short term disability
coverage, which means Victoria also lost income, as 50% is based on
commission.
Both Victoria and the printing company want to pursue legal action for the client’s negligence. In this case
DAS would cover all legal costs and provide a lawyer to pursue legal action on behalf of the business and
Victoria to recoup lost income.
DAS Canada
Exclusions and conditions:
• Any claim relating to a dispute with any provincial workers’ compensation board
• Claims arising from your client’s use or ownership of a motor vehicle
• Defending your client’s legal rights, other than in a counter-claim
29
Bodily Injury
DAS Canada
Tax Protection
31
We will pay your client’s legal costs for a tax appeal or tax audit relating to:
• Liability for income tax, GST, PST, or HST arising from your client’s business operations
• Payroll deductions compliance
DAS Canada
Tax Protection: Claim Example
32
Jas was contacted by the Canada Revenue Agency, who said her business owed
$560,000 in untaxed income after underpaying its taxes for three years. Jas
believed her business had been overvalued, but was unsure how to respond to
the CRA or navigate the tax court system, so she contacted DAS.
We assigned a tax lawyer to respond and provided Jas with an accountant to assist with the audit. The
lawyer was able to negotiate the amount of undeclared income down to $280,000, cutting Jas’s tax bill in
half. Thanks to her DASbusiness policy, Jas also saved $15,000 in legal fees!
DAS Canada
Exclusions and conditions:
• $500 deductible
• Any legal costs in excess of $25,000
• Any claim:
• Arising from a tax avoidance scheme
• Caused by your client’s failure to register for GST, PST, HST
• Arising from an investigation by the CRA into alleged gross negligence, dishonesty, or
criminal offences
33
Tax Protection
DAS Canada
Contract Disputes & Debt Recovery(Optional coverage)
35
We will pay your client’s legal costs to either defend or pursue their legal rights for
disputes related to:
• Selling or buying goods
• Providing or obtaining services
Plus for debt recovery disputes, your client keeps 100% of the monies collected.
• Unlike collection agencies which can charge up to 30%
DAS Canada 36
Contract Disputes: Claims Examples
Sheila was involved in a dispute over the quality of work done by a subcontractor
that she engaged to pour a concrete foundation on a job. Sheila was seeking
around $12,000 in damages as a result of delays and cost overruns to fix the
foundation; which the sub-contractor refused to pay.
After calling the legal advice helpline, DAS appointed a lawyer who represented Sheila’s business all the way
through to the hearing in the small claims court. The judge awarded Sheila the $12,000 she asked for. If
Sheila did not have a DASbusiness policy, she would have paid out-of-pocket about $9,000 in legal and
disbursement fees.
DAS Canada
Exclusions and conditions:
• Dollar value of the dispute must exceed $500
• 90-day waiting period
• Any claims or disputes relating to:
• Contracts involving motor vehicles
• Terms of property lease or tenancy, if your client is the landlord
• Settlement amount payable under an insurance policy
• Loans, mortgages, pensions or any other financial products
• An insured person’s breach of professional duty
37
Contract Disputes & Debt Recovery- Optional coverage -
DAS Canada
Unlimited Telephone Legal Advice
Easy 24 / 7 access
General legal advice provided
Like a law firm on retainer
38
DAS Canada
One Major Claims Criteria
Reasonable Prospects
For civil cases, “reasonable prospect of success” means
we agree it is always more likely than not that an insured
person will recover losses or damages (or obtain other
legal remedy which we have agreed to) or make a
successful defence.
39
51%
DAS Canada40
1
It starts with a
phone call
2
Legal advice
is given
3
Claims
determination
4
Panel lawyer
is assigned
Claims Process
DAS Canada
Pricing & Commission
Premium is based on:1. Revenue
2. Payroll
3. Business class
17.5%Broker commission
43
+$1,200Is the average premium for DASbusiness
DAS Canada
Based on a one sentence description …
58%Of business owners said they would purchase
a Legal Expense Insurance policy
44
Source: 2015 DAS Canada & Ipsos Small Business Owner Research
DAS Canada
Of those who would buy…
57%Would be willing to pay
at least $1,260 to purchase
a legal expense insurance policy
45
Source: 2015 DAS Canada & Ipsos Small Business Owner Research
DAS Canada
Surprisingly, only …
12%Of business owners felt they had sufficient commercial
insurance coverage if sued or taken to court by an employee,
supplier, customer, government agency or general public
47
Source: 2015 DAS Canada & Ipsos Small Business Owner Research
DAS Canada
Starting the Conversation
• How much was spent on legal fees last year?
• Could your business afford the financial impact of two-day civil action that
would cost $37,000?
• Have you ever been subject to an investigation by an occupational health and
safety board?
• Have you experienced issues concerning contractual obligations or collection of
money owed?
48
DAS Canada
Starting The Conversation
• Would you have the time and resources to defend your business if someone
pursed legal action against you?
• Do you know someone who lost their business due to the legal fees and
damages associated with a lawsuit?
• Do you know there are legal expense gaps in your current commercial
insurance portfolio?
49
DAS Canada
The Value Proposition
We empower business owners when they face unforeseen legal issues.
A DASbusiness policy:
Allows your clients to defend or pursue their legal rights
Protects your clients from costly legal expenses
Gives them unlimited access to legal advice at any time
50
DAS Canada
D & OCGL
EPLFleet PropertyLife
Legal Expense
Complete the Financial Protection Portfolio
51
DAS Canada
Our Partner Panel Firms: Ontario
• Gowlings
• McCague Borlack LLP
• Miller Thomson
• Edward L. Burlew
• Pace Law
• Devry Smith Frank LLP
• House Law
• Szemenyei MacKenzie
Group LLP
• X Police
DAS Canada
Our Partner Panel Firms: Saskatchewan
• Miller Thomson
• McDougall Gauley LLP
• Holash Logue McCullagh
DAS Canada
Our Partner Panel Firms: British Columbia
• Gowlings
• Access Law Group
• Lesperance Mendes
• Smeets Law Corporation
• Whitelaw Twining Law Corporation
DAS Canada
Our Partner Panel Firms: Quebec
• Boro Polnicky Lighter
• Kugler Kandestin
• Langlois Kronström Desjardins
• Robinson Sheppard Shapiro