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architectOperating a business presents daily challenges and requires hard work. America’s home builders know this, as you struggle with supply shortages, price increases and rising mortgage rates. Despite these problems, it is important to remember the reason you went into business in the first place—to make a profit—and to focus on how to remain profitable. We believe we can help you simplify your effort to stay in the black.

The modern world is complex. Every day we are deluged with useful and not so useful information. One way to navigate the clutter of the internet age is to organize our thoughts by making a list. A list seems unremarkable, but lists have many positive effects like reducing anxiety, increasing productivity, creating accountability, improving organization, and strengthening memory.

You probably have discovered the power of the list long ago and may already have a collection of lists on your desk. One way to make a more important list stand out is through alliteration—using the same sound to start multiple words in a sentence—a device used in children’s rhymes and tongue twisters. (Note how most people can tell you the green vegetable that Peter Piper picks and what the little girl sells by the seashore.)

We have a list that uses alliteration and reminds us how to make our company profitable. Procure profits from planning, people, products, performance, and protection. We believe this simple sentence is a recipe for success in any business.

Planning. Many people have great ideas for how they can make money--the aunt who wants to open a coffee shop, the friend who can improve the product his employer makes, and the cousin who thought of Amazon’s business model years ago but never got around to developing it. The world is full of these kinds of dreamers. But dreams are not plans. Successful business owners take hold of their dreams, plan how they can accomplish them, and work hard to bring their dreams to life. Planning does not end when a business starts, but continues with every new housing development, shift in the market, or change in competition. Wise business owners regularly refresh their plans, checking if their pricing is right, their products are hot, and for other ways to make even more profit. Effective planning leads to better use of resources, realistic timelines, seamless growth, and a path to profitability.

People. One of the most rewarding and at times frustrating aspects of running a business is the human factor—our employees.  Good employees help a company be great. Conversely, employee problems distract management from focusing on the bottom line and can cost a company business and profits. Successful companies reward good employees, drop employees who are a drag on the organization, and let their employees know that ownership, management, and workers are on the same side, pulling in the same direction.

Products. Drive around most towns and you’ll see the history of American home building--stately Victorian homes, rowhouses, Cape Cods, bi-levels, McMansions, ranches, and now even tiny houses, to name a few. Each type of home was the hot item in the marketplace—for a while. But then people wanted something different. Profitable builders stayed in tune with the changing tastes of their customers and gave the people what they wanted.

Performance. For better or worse we live in a world that moves quickly. Studies show that consumers are very concerned about the speed at which they get what they have purchased. When building a house, it is important to stay on schedule or to fully explain any delays and then stick to the revised schedule. A new home is usually the most expensive item your customer has ever bought. Expectations will be high, and builders who hope to be profitable should deliver a quality product and complete any call back work timely and professionally. How you perform with each customer can affect what they tell their friends and family about you, which can lead to increased sales or to disappointment.

Protection. Once a good plan is crafted, competent workers are hired, and the right models of homes are sold and well-constructed, profits should follow. To keep the money it has earned, a well-run building company protects itself from risks that can bleed a company dry. Well drafted sales agreements together with appropriate liability and other insurance are part of that protection. Successful builders who hope to be profitable should also place an express warranty on every home they build, preferably one with a mandatory binding arbitration provision, a team of warranty professionals who can help resolve disputes, and the best insurance backing in the industry.

RWC has four decades of experience in the home warranty business, covering more than 3.7 million homes! We offer a wide variety of warranty options, from the standard ten-year warranty to our Day 1 coverage warranty and from our extended appliance and system warranties to our specialty warranties for remodeling projects, detached garages, and commercial construction. Only RWC has developed and offers its members a customized state warranty that mirrors each state’s statute of repose and accommodates other state specific issues. All RWC warranties provide clear performance standards that help create realistic expectations in your homeowners and provide a road map to resolving even the stickiest customer complaints.

At RWC, every guarantee our warranties make is backed by Western Pacific Mutual Insurance Company, RRG. Western Pacific has an A- rating from A. M. Best and only insures home warranty and similar new home construction risks, like builders’ general liability, which can be offered through the RWC Insurance Advantage program to RWC members. No other warranty company has an insurer with this kind of strength solely dedicated to covering builders and their homes.

If you want your company to succeed, procure profits from planning, people, products, performance, and protection, and remember that the best protection you can get is an RWC warranty on each of your homes!

Have a great Spring and Summer!

While you may be aware that prefabricated homes have been around for quite some time, have you really given them the consideration they deserve? There are many factors that make this niche of the housing market an incredibly intelligent and environmentally sound option.

If you’re looking for a build that involves a quicker, less stressful timeframe, can potentially cost less, and have a positive impact on the environment then read up on the benefits of flat pack and modular living here! https://www.houzz.com/magazine/10-things-to-know-about-prefab-homes-stsetivw-vs~33040342 

Furthermore, did you know that RWC offers warranties on Modular homes? One of the changes seen over the last several years is the awareness of and increased need for written warranties on homes of all types, including Building Systems. So, we delivered.

RWC takes a two-pronged approach to warranties for Building Systems.

Manufacturer’s Warranty: Manufacturers may join RWC and offer a 10 year written and insured structural warranty on the homes they deliver to you, the Builder.

Builder’s Warranty: As the Builder onsite, you may also provide a 10 year written and insured warranty on the work you do to the home, including foundations.

Interested? Go here for a quote and more info https://www.rwcwarranty.com/builders/warranty-options/building-system-warranty/

Warranties vs General Liability – What’s the Difference?

Basically, a warranty covers workmanship issues while general liability covers damage to property and/or injury to people caused by such workmanship issues. A warranty and a general liability policy actually cancel one another out. This can lead to trouble. For instance:

When your general liability insurer and your warranty company aren’t affiliated, you can find yourself in a litigious situation with both parties pointing their finger at each other. A good example is a home that has a failing beam (maybe it wasn’t spanned properly). The floor is sagging, but the beam hasn’t given way yet; however, it’s obvious that the beam will fail in time. Is this a warranty issue or is it a general liability issue?

While the beam holds, and no other property has been damaged, and no one has been hurt, any general liability insurer would say this is a problem for the warranty company. Then the homeowner submits a claim for kitchen cabinets that have pulled loose due to stress caused by the sagging beam. They also ask to be reimbursed for hotel expenses they incur because they are afraid to stay in the house. Would a warranty provider cover these things?

At this point, we enter a gray area resulting in endless debates over who is liable. With the RWC Insurance Advantage working with RWC, there are no gray areas; no "is it a liability loss or a warranty claim?" If it is a covered loss, either way, you (the builder) won't get caught in the middle.

So, which makes more sense? Two companies that are better at finger pointing and keeping you in that scary gray area? OR two companies that work together providing you with comprehensive coverage and making that gray go away? If gray isn’t your company’s favorite color, contact us for a quote!

 Warranty Benefits from Residential Warranty Company

Insurance Benefits of the RWC Insurance Advantage

The RWC and RIA General Liability programs are both insured by Western Pacific Mutual Insurance Company, a Risk Retention Group, which has been rated “A- (Excellent)” by A.M. Best continuously since 2001.

*Not available in all states

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866-247-2155

info@rwcinsuranceadvantage.com

www.rwcinsuanceadvantage.com

There’s an old saying that insurance doesn’t matter…until it does. General liability, GL for short, is fundamental to the business world. Most everyone knows that GL protects you from suits and claims brought against you by people injured on your jobsite, or homeowners who allege damage caused by defects in the way a house was built. Beyond this, things get a little fuzzy, which leads to some creative myth-making.  Here are the top 5 GL myths we hear all the time:

Counting Down the Myths

#5 - I have Builders Risk. I don’t need GL, do I?

Builders risk only covers your building materials at your jobsites while during construction. It’s property coverage. With limited exceptions on some policies, there is no coverage for a passerby who trips and falls over a piece of scrap lumber that spilled onto the sidewalk and no coverage for construction defect claims later on.

#4 - My subs have GL, so I don’t need it, or do I?

Your subcontractors better have GL, or their claims become yours. Even if they have their own coverage, you can still be liable for some claims involving your subs. As the general contractor, you’re responsible for overall safety at the jobsite. Are you making sure your subs keep the sidewalks free of scrap lumber and other debris? Even if you police the jobsite every day, when was the last time you required your subs to provide a certificate of insurance? Are you named additional insured on their GL policies? Do they hold you harmless in your written contracts with them? All these things can create liability for you if neglected.

#3 - I do some engineering and design work on the side.  My GL covers that, right?

Wrong. If you provide any professional services, you need professional liability insurance. GL doesn’t cover inaccurate advice, misrepresentation or claims involving bad faith.

#2 - I only build one home a year.  I’m too small to need GL, aren’t I?

I’ll answer this question with a question – the last time you drove down any highway, how many billboards advertising personal injury law firms did you see? We live in a highly litigious society. Any business, no matter how small, how new, or how experienced is vulnerable to suits or claims by members of the public. Why take chances with your livelihood?

 

AND THE #1 GL MYTH – I’ve been in business for 20 years and never had a claim. Why should I pay for GL now?

I could answer this by simply saying read #2 again. The fact is you don’t have to purchase GL unless someone else requires it. Usually, some other business or governmental entity wants to see proof that you have GL. Why? To avoid having to deal with suits or claims that you’re responsible for. It’s called contingent liability. In reason #4, if you hire a sub who doesn’t have GL, you are responsible for his claims while working for you because you failed to make sure he had the necessary insurance. Not fair you say? Show me fair.

I hope this little countdown of GL myths helps to convince the previously unconvinced that having the proper GL coverage for your business is just as important as laying the proper foundation for a home.  Anything you build on top of a shaky foundation is bound to fall sometime. For the riverboat gamblers out there nothing I say will be convincing. For the great majority of you, it might be time to take a look at your GL coverage needs. We can also handle your builders’ risk while we're at  it. rwc logo

Call us at 1-866-454-2156 or visit us at https://rwcinsuranceadvantage.com/products/general-liability/ for a free, no obligation quote.

Sally wanted to buy a house in the valley, but she knew better than to dilly-dally. Sally had heard that houses were in big demand, so she hired a realtor to lend her a hand. The agent showed her three places, each of which offered beautiful spaces. She wanted to get into a house quick, however she could not decide what to pick. Her savvy agent was smart and knew just what wisdom to impart. For only one home came with sureties, it offered warranties to cover obscurities.

Whether you build homes, have a personal home to sell, or rehab homes to put on the market, you face similar obstacles. Buyers search for unique features and upgrades with the hope that one stands out above the rest. Trends can come and go, paint colors, flooring types, built-ins, all of these are at risk of becoming the next “no” on a buyers list. Something that does not go out of style, however, is the desire for reassurance and protection from defects or expensive repairs. Referencing the story of Sally above, let’s examine why an educated agent might recommend a house with warranty coverage.

Imagine how excited Sally was when she moved into her new home. To Sally, she saw a cute 5-year-old two-story bungalow with a private backyard near a babbling creek. The property included all the appliances and every updated feature that she had sought. At the time, it did not cross Sally’s mind that an issue may be awaiting her sooner rather than later. A few months after settling in, the water heater stopped working and she discovered a crack in the basement wall that appeared to be leaking.

Many buyers hope that these defects are caught by their chosen home inspector. However, even with the most detailed of inspections, appliances and mechanicals are fickle. These systems can break down without warning and inevitably at the worst moment. Adding to this scenario, because of limited inventory and high demand, waiving the buyers right to an inspection has become more common. This increases the chances of things being missed, like small cracks in the dark corner of a basement.

Without specific, clear, warranty protection in place, Sally has no assurances or proper assistance to help her with a resolution. All she is armed with is a concern that there may be a larger issue or potentially a known default that was not disclosed. A typical first step is to reach out to friends or neighbors who may offer suggestions and recommendations for who to contact. Based on similar scenarios that have occurred, things like this can go sideways very quickly.

For example, if a contractor determines that the leak is due to a structural failure that was imminent given the location to the creek, the original builder may find themselves in hot water. Since the home is only 5 years old, the problem may qualify as a pursuable default under statewide implied warranty statutes. Should it escalate, potentially, the builder may end up at the mercy of legal systems and public opinions. If the perspective viewpoints are not rooted in an understanding of typical building practices, endless court battles may ensue.

Additionally, mechanical warranties are a complex animal. It is not beyond feasibility that the fine print on the water heater may indicate that, without prior approval, the original owner cannot transfer the warranty. This disclaimer could allow the manufacturer to void the warranty. In either of these sample circumstances, Sally could present her complaints to an attorney and potentially be able to pursue legal recourse.

Let’s face it, in a sellers’ market, buyers are at a disadvantage, however disadvantage does not negate liability. Homeowners and well-meaning builders who believe their “good build history” should be enough are underestimating the overall risks. Without disclosing potential mechanical issues, sellers are left with the burden of proving no negligence existed. Without spelling out what sorts of structural things are covered and for what time frame, builders are inadvertently ignoring the potential for serious liability.

Warranties certainly are not the be all and end all to escape liability. What they can provide is peace of mind when navigating a homeowner's construction defect claim. The cycle of building, buying, and selling homes requires clearcut guidelines to help avoid fruitless and expensive legal battles. The appropriate coverage to meet these needs is vitally important to differentiate yourself, protect all parties, and demonstrate concern for the homeowner.

If you are unsure where to turn to get proper coverage, step one is to consult with a proven, stable, warranty company. With nearly 40 years of experience Residential Warranty Company, LLC, can help you determine what programs may work best to meet your needs. With an extensive list of options, including everything from new home construction to existing home coverages, there is something to suit every situation.

As a leader in the residential home building industry, RWC Insurance Advantage is committed to providing general liability insurance and select other coverages to members of RWC. Below are some commonly asked questions:

 What is an additional insured?

An Additional Insured is a person or organization that, like you, enjoys the benefits of being an insured under your policy. An additional insured cannot make changes to your policy.

Why should I be an additional insured on my subcontractors’ policies?

When you require your subcontractors to list you as an Additional Insured on their General Liability policies, you become entitled to insurance coverage benefits under their policies. Additional Insured status is most often used in connection with an indemnification agreement, also known as a hold-harmless clause. Hold harmless clauses are common elements of a properly executed contract between you and your subcontractors. Under a hold-harmless, your subcontractors agree not to hold you responsible for their negligent acts which may have happened while they are working for you. For example, if your painter over-sprays several cars parked near the three-story townhouse you are building, the painter’s policy will respond to the claims made by the owners of the cars. If you are brought into a lawsuit filed by the car owners, the painter’s insurance company will defend you.

What if my subcontractor doesn’t have insurance? 

If your subcontractor doesn’t have his or her own General Liability, you can be held liable for claims made against the subcontractor. This is because the General Contractor is considered to be in charge of the worksite, and therefore, is responsible for the safety of the public at that site. Beware of policies sold by some insurance companies that exclude claims arising out of the work performed for you by subcontractors.

Housing shortages. Political upheaval. Employment problems. Covid mutations. Natural disasters. Supply chain issues.

smiling woman drinking coffee

It sure feels like we are being inundated daily with news that hits like a gut punch. It is confusing and, sometimes, downright depressing. Even if you do not watch evening news, or read news online, you likely feel these global effects.

Perhaps you went to the store and found that over half of the items you needed were missing from the shelves. Maybe you went to your favorite restaurant and encountered a long wait because there were not enough employees for the shift. Or, worse yet, you discovered that the restaurant closed due to catastrophic understaffing. Not including shipping problems or the quadruple pricing issues for everyday supplies... These are only a snippet of some small inconveniences and not the big picture.

Despite all the “bad” news, there is one surefire thing you can do to help turn down the intensity. Start by acknowledging that the one and only thing you have control over is YOU. Take an inventory of the personal attitude you project and carry into each day. Consciously self-regulating your responses and thoughts can ease the burden of external pressure.

A tool to shift away from stress inducing thoughts is to make reflecting on what went right a daily goal. Begin by replacing overwhelming challenges with achievable targets. Was the coffee you ordered made correctly? Did you find an item you thought lost for good? As the saying goes; it’s the little things. If you celebrate the winning moments of your day you will begin to feel your perspective shift. Reflecting on the good things, both large and small, places ripples of positivity throughout the pond.

Consider this message to be a reminder that empathy goes a long way. Not only empathy for others, but empathy toward yourself. Self-love helps you remember that you are human. As such, you only have so much influence over what comes your direction. Through sharing a desire to look for the good in things you may find that others start to feel motivated to do the same.

We can only fix the big things by starting with the small things. A beautiful stained-glass window cannot come to be without each individual grain of sand. Working together to get through what can feel like unsurmountable change will take an effort. By centering focus on all that is good, the benefits impact everyone. You will not regret choosing happiness and joy.

If you feel up for a challenge, try using a happiness calendar with daily goals. I recommend the organization Action for Happiness. A sample may be found via this link: www.actionforhappiness.org/october

RWC has a lot to offer. Are you taking full advantage of ALL of our services? Make it your New Year's Resolution to complete this checklist. If something piques your interest contact your Account Executive or email info@rwcwarranty.com.

According to an analysis by PeopleReady.com's skilled trades division, there were 388,345 jobs posted for trades-related workers between May and June of this year.

Positions most in demand are:

NAHB Members and HBAs are trying to do their part and actively recruit the next generation, however, finding qualified subs and trades continues to be a challenge for the residential construction industry. Nonetheless, they are stepping up to the plate and taking action. By providing supplies, scholarships, and one-on-one connections with students, HBAs around the country are getting out into their communities to spread the word about the rewarding jobs throughout the industry through:

- Lectures at Community Colleges - Supplies and Scholarship Support through High Schools and Local Technical Schools - Direct Connections to Career Professionals through Events and Home Shows

NAHB.org's Careers in Construction toolkit has ideas and resources for members and HBAs to connect with their local community. Check it out!

Source nahb.org

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Ronald L. Sweigert was recently named co-manager of RWC's Member Services Department in charge of enrollments and customer service. In his nearly twenty-nine years of service with our company, Ron has worked as a warranty advisor, as a special agent for insurance sales, and as general manager of a small builder call-back service operation. Most recently he was a warranty administrator in our Member Services Department. We are confident that Ron’s long and varied experience together with his penchant for innovation will serve him and the company well in his new position. Ron replaces Sandra Sweigert, who agreed to take on more responsibility for the company as co-manager in our Warranty Resolution Department.

Logan M. Radle also has been named co-manager of the Member Services Department in charge of underwriting. Logan is a 2011 graduate of Millersville University and is licensed in property and casualty insurance by the Pennsylvania Insurance Department. Prior to joining us, Logan worked as a claim specialist for a national insurance company. Since coming on board, she has distinguished herself in our insurance operations, where she oversaw the underwriting of bonds for members of the warranty programs. Logan’s training, demeanor, and attention to detail make her an ideal fit for her new position. Logan replaces long-time manager Bryon Earhart, who has reduced his workweek to two days so that he can tend to familial obligations. Bryon will continue with the company on a part-time basis as our Chief Warranty Underwriter.

We are excited about bringing Ron and Logan forward into management positions, especially since the excellent employees they have replaced are still working with us. Please do not hesitate to call on Ron or Logan (or any of us for that matter) if we can help you, our valued members, in any way.

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