Bensman Risk Management, Inc.

Insurable Interests

Bensman Risk Management, Inc.
2333 Waukegan Road Suite 275
Bannockburn, IL 60015
847-572-0800 Phone
847-572-0502 Fax

Insurable Interests may offer general financial, insurance, tax and business ideas. However, due to the ever-changing tax laws as well as the complexity of the financial industry, you should seek professional advice before implementing any of the ideas contained in this newsletter. The Bensman Group, Bensman Associates Ltd., Bensman Risk Management, Inc. or Schemata, L.L.C. assumes no liability whatsoever in connection with the use of this newsletter.

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Securities offered through Kestra Investment Services, LLC (Kestra IS), Member FINRA/SIPC. Investment Advisory Services offered through Kestra Advisory Services, LLC (Kestra AS). Kestra IS and Kestra AS are not affiliated with The Bensman Group, Bensman Associates Ltd., Bensman Risk Management, Inc. or Schemata, L.L.C.

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Insurable Interests

Vol. 6, Issue 9May 2011


Protect Yourself From Household Employees

It is not unusual to hire people to help you around the house. If you have children, you might hire a nanny. You also might hire a personal assistant to help you pay your household bills and keep up with your personal paperwork, or a housekeeper or gardener to keep things looking good inside and outside your house.

Household help can be a great boon to your productivity and personal time. But you should be aware of the potential risk that someone you hire to help you out might also help himself to your identity, your credit cards, your cash or your valuables.

Protecting yourself starts with the hiring process. Even if you work with an agency, make sure the agency has thoroughly vetted its people. Did they do criminal background checks in multiple states? Did they fingerprint potential hires for those checks? How do they verify that the person is who she says she is? And what happens if you find something missing – does the employee have to be convicted before you can collect from the firm for your losses?

If you don’t work with a reputable agency, you have to do all the background checks yourself. Be thorough. At the very least, use an online background-checking service. If you want to be even more thorough, you can hire a private detective.

And whether you use an agency or hire on your own, call references. Ask them how they have known the candidate, how long he worked for them, why he left, whether there were any issues during his employment, and whether the reference would hire him again.

Once the employee comes to work for you, exercise basic caution. Lock up your valuables such as jewelry, money, checks, credit cards and bank statements. Don’t give your household help access to any more information than each person needs to do her job. At least for the first several months, carefully check your bank statements and credit card bills to make sure that there is nothing suspicious. Get a credit report at least once a year, and check it for any charges you didn’t make or any new cards you did not apply for.

Obviously, your level of caution depends in part on the type of work the employee is doing. For example, a landscaper who works only outside poses much less threat than a housekeeper or nanny who is in your home regularly when you are not there. But no matter what the employee’s job is, it pays to check references and stay alert.

Finally, protect yourself by following the law. Make sure household employees are legal to work in the United States. Talk to your accountant or tax professional about the forms the IRS requires you to file.

Comply with all wage, tax, and worker’s compensation insurance laws. Homeowner’s and umbrella policies specifically exclude losses that should be covered by worker’s compensation insurance, so you may find yourself with very large out-of-pocket expenses for medical bills, lost wages and rehabilitative services for your injured employee.

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