Frequently Asked Questions

Have a question? We have an answer.

Automobile Liability

Because of the tremendous risks associated with 15-passenger vans and the driver selection and training requirements, we discourage the use of 15-passenger vans for any activities.

If you drive your personal automobile for fraternity/sorority-related business and are involved in an accident, you need to rely on your own personal automobile insurance to pay for any injuries or damages to a third party or to your own automobile.

The organization’s policy will protect the organization if they are named in a lawsuit, but you would need to look to your own policy for your protection. With the use of automobiles, the liability always follows the automobile.

We strongly discourage the use of members’ vehicles for transportation of members and guests from fraternity/sorority functions, including recruitment and social activities. We encourage our clients to utilize professional transportation services when at all possible that meet the following criteria:

  • The transportation company supplies proof of commercial automobile insurance that provides coverage for transporting people and property for a few and a minimum of $1,000,000 combined single limit for bodily injury and property damage.
  • The transportation company engages professional drivers who have valid commercial vehicle operator’s license in the state in which the company is located.

We first and foremost suggest that you make sure using Uber fits within your organization’s transportation policy.

The best form of transportation is using a third-party that has adequate insurance, like a bus company. Using a bus company assumes the driver has been vetted, and there is usually adequate insurance from the bus company. We understand that utilizing a bus service is not always possible or affordable.

The issue with Uber, Lyft, and similar ride-share arrangements is that they have a very strict indemnity and hold harmless provision with the drivers, which basically states that Uber/Lyft is not responsible or would offer very low limits for any accident. Thus, the driver would have to look to his/her own personal auto coverage, but personal auto policies do not cover for-hire operations, and it is unlikely that the driver is paying for a special auto endorsement to cover him when on duty as an Uber/Lyft driver. Therefore, payment for an injury sustained in an Uber/Lyft vehicle would most likely fall upon your organization’s liability policy. However, we agree that using Uber or Lyft is probably better than allowing members to drive other members/guests around town.

Be sure to check with your national organization that will have a risk management policy regarding the use of these types of services.

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COVID

We actually did almost an entire webinar on decontamination and COVID-19. But what we know about the virus is changing almost daily, so it is imperative that you rely on the experts from the CDC. Bookmark this page for the CDC’s decontamination and disinfecting guidelines.

We also created this resource, which uses the CDC guidelines, but is specific to sorority chapter houses. In addition, this weekly email addresses some other recommendations and questions.

Legal liability exists when:

  • The wrongdoer (chapter house or corporation) is found guilty of “negligent conduct” meaning they breached a duty owed to the injured party
  • The injured party suffers actual damages such as getting ill with the virus
  • The wrongdoer’s negligent conduct is the proximate cause of the injury or damage

What actions during the COVID-19 crisis could possibly lead to the insured (chapter and/or house corporation) being found legally liable for an injury from the virus? Before we lay out some examples it is always important to remember that society and the courts generally only require that a person or entity act “as a reasonable and prudent person” and using their best, and most informed, judgement act accordingly. 

Examples might be:

  • Allowing an employee who is known to be infected with the virus to continue working
  • Forcing an employee to continue to work in a chapter house where there are resident members who are ill and isolated at the house
  • Failure to adhere to required health and prevention guidelines
  • No efforts to educate your employees and/or members on the health and prevention guidelines
  • Remaining open following an order by a civil authority to close
  • Indiscriminate application of rules and guidelines for the members of how to safely live in the chapter house to not expose your sisters to the virus

There are numerous other scenarios; however, the major point is that there will be advice from experts like the CDC on how to follow health and prevention guidelines to keep your chapter house safe from spreading COVID-19. The key is to follow the health and prevention guidelines, educate your employees and members on these guidelines, and put measures in place to ensure their compliance of these guidelines.  Should someone get injured or ill and allege they did so on your property, you will be able to confidently defend your position by having followed these best practices.

Whether or not to quarantine sick members at the chapter house is up to each individual chapter and house corporation to decide based on their organization’s guidance, their campus and local health department guidance, and the structure and layout of their individual facilities.

We have created some questions to consider in making the decision whether or not to quarantine sick members at the chapter house. Our general stance is that members should quarantine somewhere other than the chapter facility, as a communal living space presents difficulties in quarantining properly. We have heard of some situations where the local health officials are recommending members stay in chapter facilities as needed, but typically the university can provide a better alternative for quarantining. 

Kappa Alpha Theta created this housing and safety plan that they graciously agreed to share, which includes a simple approach and expectations should a member be symptomatic or test positive. Each sorority is using a slightly different philosophy, but many general principles are mutual. 

If a location does choose to quarantine ill members, this is the CDC guidance for quarantining sick members: 

  • All household members should educate themselves about COVID-19 symptoms and preventing the spread of COVID-19 in homes. 
  • Clean and disinfect high-touch surfaces daily in household common areas (e.g. tables, hard-backed chairs, doorknobs, light switches, phones, tablets, touch screens, remote controls, keyboards, handles, desks, toilets, sinks) 
  • In the bedroom/bathroom dedicated for an ill person: consider reducing cleaning frequency to as-needed (e.g., soiled items and surfaces) to avoid unnecessary contact with the ill person. 
  • As much as possible, an ill person should stay in a specific room and away from other people in their chapter. 
  • A designated individual should be the caregiver who can provide personal cleaning supplies for an ill person’s room and bathroom. These supplies include tissues, paper towels, cleaners and EPA-registered disinfectants. 
  • If a separate bathroom is not available, the bathroom should be cleaned and disinfected after each use by an ill person. If this is not possible, the designated caregiver should wait as long as practical after use by an ill person to clean and disinfect the high-touch surfaces. 
  • All household members should follow home care guidance when interacting with persons with suspected/confirmed COVID-19 and their isolation rooms/bathrooms.

As always, we encourage you to check with your national organization’s guidelines regarding quarantining members.

We also have numerous resources at our COVID-19 Response Center. Contact us with any questions, as always!

Concerns with mandating tests are more practical and logistical than insurance-related, as requiring testing is not a guarantee and not thoroughly enforceable on a wide scale. Further, it likely would involve coordination and financial investment to provide and/or require testing before returning to campus at this point. We maintain that it would be difficult to prove negligence in the event one of your members or tenants contracts the virus, even if you did not provide testing. Negligence might come into play if you did not follow through with promised health and safety measures or knowingly expose those in your care; for example, you require testing but do not act on results received. At this time, there is not a virus exclusion on the General Liability policy should this coverage need to come into play.

Unfortunately, this, like so much when it comes to this global pandemic, varies wildly from location to location based on the availability of testing. Even when tests are available, we are hearing that in many places it is taking more than a week to get results. If testing isn’t available for students on campus or nearby, it also may not even be accurate by they time that they move in. For example, if they take the test in their hometown, it only reflects their status at that moment, and they could contract the virus in their travels to campus or even their first night in town. If they take a test five days before they return to school, they may not have the results once they get back.

It is helpful to encourage tests if members feel that they may have been exposed and stress to all of them that it is important that they maintain social distancing when possible and be truthful if they begin to experience symptoms.

In “normal times,” we strongly discourage allowing members or anyone other than trained staff use the commercial kitchen. We are concerned from a safety standpoint because there are so many opportunities for injury in any kitchen and particularly a commercial kitchen where the equipment can be even more difficult to operate without training. If members are preparing food for other residents, it also can create problems with Workers’ Compensation insurance – it can make it difficult to be able to determine if an injury occurred when the member was working or if it happened during time when she was just a resident.

That’s all of the risk management “stuff.” There isn’t anything specifically in the insurance policies that actually specify this however, so there aren’t any exclusions in the policies that would create coverage problems if you did ultimately decide that it is worth the liability that you might take on to allow members to access the commercial kitchen to prepare foods for themselves. This is an unusual year, and we understand that you will need to get creative in order to make things work. We would recommend that, if possible, you should still have some controls in place for the commercial kitchen – such as removing equipment that they could really do without, such as the commercial stand mixer, deli slicer or other items that wouldn’t be included in a residential kitchen, and locking the kitchen overnight if possible, especially if there is another corner that you could tuck a refrigerator and microwave. You’ll also need to impress upon the residents that it will be up to all of them to maintain safety in the kitchen, just like it will be up to all of them to keep everyone safe from COVID-19.

The actual question was as follows:

We are thinking about taking temperatures of members and vendors this fall at our chapter houses. For members, it would be upon move-in and then perhaps once per week when they have to update their Attestation to Good Health form. For vendors (housekeeping, kitchen staff, outside maintenance), it would be each time they came to work (daily). Is there a liability involved with this?

There is a section of our To Consider Before Reopening resource which touches on Testing (page 9). You are welcome to take temperatures as long as you are following local health guidelines. We have also seen some arguments in favor of other symptoms being more important to track than fevers, detailed in these articles:

Many companies are using a checklist of some sort – here is a good example (MJ’s guide to creating return to work plan is here, much of which can be easily transferable to the chapter house). Liability and negligence might come into play if you did not follow through with promised health and safety measures or knowingly expose those in your care; for example, you require temperature checks daily or weekly, but stop doing so halfway through the semester or do not act on results received.

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Employee/Employer

If hiring a contractor, here are some points to consider:

Secure the services of only an insured contractor or company and ensure that they have the following recommended minimum limits of liability insurance by getting a copy of their Certificate of Insurance (where applicable):

  • General Liability $1,000,000 per occurrence
  • Liquor Liability $1,000,000 per occurrence
  • Automobile Liability $1,000,000 per occurrence
  • Workers’ Compensation $500,000 per accident

The main reason we recommend that your contractors have their own insurance is so your organization’s coverage would not have to respond to a claim that was caused solely by your contractor. The reason we recommend the above minimum limits is that these are industry standards and, should we need to file a claim against the subcontractor for damage or bodily injury they caused, we would want sufficient limits to access or what we refer to as subrogation against a third party.

We do not support our clients hiring members as employees. The main concern is with workers’ compensation coverage. First, there is a question of whether or not this type of employee would even be eligible for workers’ compensation coverage because of the way workers’ compensation policies are structured. If they do have it, employing members, whether they are residents of the facility or not, broadens the liability of the workers’ compensation coverage. It becomes more difficult, if not impossible, to ascertain whether the injury took place at work or during personal time, which could ultimately make the workers’ compensation coverage a de facto health insurance replacement.

We also have concerns with Employment Practices Liability, including the following complicated questions:

  • Are hours clearly defined?
  • What happens if members are doing work on personal time, either on their own or at the direction of their supervisor?
  • What if they are disciplined either based on not completing job responsibilities or for violating policies as a member?
  • Does that open the employer (chapter or house corporation) to claims for hostile work environment?

As is evident, this is a complicated exposure. Please contact your Client Executive with further questions.

For purposes of the Workers’ Compensation coverage, the usual definition of an employee is as follows:

  • “Employee is generally defined as a person hired to perform certain services or tasks for particular wages or salary under the control of another (the employer).
  • “A worker hired to perform a specific job usual and customary to the employer’s business operation in exchange for money or other remuneration.”

The main feature of this definition is the amount of control that the employer has over an individual, which then qualifies that person as an employee. Independent contractors are the opposite of employees and these individuals or firms are hired to do work that is generally not within the usual trade or business of the employer. An example of this would be the landscaper hired to prune or a handyman hired to clean off snow from your sidewalk.

The insurance policy will be issued on your organization’s national policy effective date with an estimated compensation for your location. At the conclusion of this policy period, you will be asked to provide MJ Insurance with your actual compensation dollars for your employees.

The compensation number is to include not only the monetary compensation paid to your employees but any “in kind” compensation such as room and board allowances, use of a cell phone for the house director, and meals for your hashers/house boys as some examples. The total value of both is monetary and “in kind” compensation is what you should report at the policy year end’s audit.

Yes. For your convenience, the insurance company, Travelers, has a network of medical providers. To find one near you, click here.

Yes. The insurance company, Travelers, has developed a website to answer some of the questions you may have about the workers’ compensation process. By logging on to mywcinfo.com, you will tap into an online resource center that:

  • Clearly informs you of your rights and responsibilities in the workers compensation process
  • Provides access to claim status and claim payment information
  • Provides access to the most common state forms needed to expedite the workers compensation process
  • Is available in English and Spanish
  • Provides online support to answer your questions

If you have employees, you are required by law to purchase workers’ compensation coverage. Virtually every state requires its employers to buy workers’ compensation insurance coverage for its employees. Should there be no workers’ compensation and an employee is injured, the state will levy significant fines and costs to the employer for not meeting their obligation.

In the states of ND, OH, WA, and WY, the Workers’ Compensation insurance coverage is purchased through a state agency, and these states are referred to as monopolistic states. If your employment exposure is in one of the other states, your organization has secured a national Workers’ Compensation policy to which you have access. Please refer to the Insurance Overview for your chapter/house corporation to determine if your location is covered by the national insurance policy.

We recently had a claim reported whereby the son-in-law of the House Director was injured while doing some maintenance work for the chapter. This type of practice is concerning for two reasons: (1) If you have “volunteers” perform any type of work for you at the chapter house, it is incumbent upon you as the property owner to make certain they understand that it is at their own peril. Thus, if they are injured while performing this work, it is the expectation of your insurance company that any medical expenses will be borne by the individual. In all likelihood, they would need to then turn to their own health insurance provider. (2) Many states have very rigid expectations of someone performing any type of work on your behalf, and this could elevate them to the status of an employee and subsequently you have both tax and insurance requirements to deal with.

We certainly understand the convenience and interest of using volunteers to help out at the chapter house; however, it is important that you understand the extent to which this can complicate and ultimately impact your insurance coverage. We urge you to consider hiring out those tasks, which are likely to create a bigger risk to injury to the individual and/or put the property itself at peril. Feel free to contact us with any further questions that may arise on this subject.

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General Liability

We recommend that you contact your Headquarters about your organization’s policy regarding their BYOB policies. Each organization has its own policies regarding alcohol and events.

The policy defines an insured as the Fraternity/Sorority, Foundation, House Corporations, Chapters, Colonies and Alumnae Associations. In addition, any member, volunteer or employee is also an insured, while they are acting on behalf of the organization. Your organization has purchased a comprehensive policy to protect you should you be named in a lawsuit while acting on their behalf.

House Boys living in the chapter house is a rarely seen exposure in women’s fraternities/sororities. Each situation is unique and should be very carefully analyzed. The exposures as we see them are enumerated below and should be considered by your House Corporation. Our position is that as long as the House Corporation is addressing the following risk management considerations, we can support this practice:

  • Male visitation restrictions are common in every facility
  • Access to common areas must be limited and probably have only limited times during the day where it is possible
  • Access to the sleeping rooms should be restricted at all times
  • Security of the resident/members is of utmost concern
  • The compensation of room and board becomes both a taxable and worker’s compensation exposure for the employer
  • The House Corporation can ultimately have the confidence in the “men” abiding by the rules; however, any allowance for the men to have male or female guests creates a more complex situation. It would be our recommendation that guests not be allowed.

Please contact us directly, so that we can help you to ensure that you are properly prepared and protected.

It depends! If the food allergies are minor and something that you feel your cook/caterer can easily accommodate, then we recommend that you carefully lay out the expectations with both the members in question and the cook/caterer. If the food allergies are too severe in nature or very difficult to accommodate, we recommend that you release the member(s) in question from the meal plan. If the allergy is so severe that it calls for total elimination of the ingredient from the premises, then we recommend that you consider releasing the individual from their housing contract.

In order to avoid repeated dietary requests, we recommend that the House Corporation require a doctor’s note before agreeing to any special arrangements. If you have any further questions, please do not hesitate to contact us.

We have developed the Reviewing Contracts 101 resource that will help you identify the common pitfalls that you should be aware of in dealing with contracts. The document, along with several additional resources related to planning events and contract review, can also be found in our website Library for future reference.

Cindy addressed this issue in a recent memo, which can also be found in our website Library for future reference.

Any type of incident should be reported immediately to MJ Insurance . Officers and
members will be interviewed by the insurance company to uncover the details of the incident. More than likely several people are going to be named in the lawsuit. The insurance policy will provide defense costs and pay any judgment against you as an insured as long as you are acting on behalf of the Sorority/Fraternity and following the rules and guidelines that are in place.

The General Liability policy covers premises, as well as operations liability. Premises liability means that coverage exists for claims arising on owned or rented property. Operations liability means that coverage exists for any typical event that is held off premises, such as philanthropic activities, dances, and social events. The organization’s policies are very comprehensive and protect that organization and its members. Virtually all sponsored events are covered; however, intentional acts (defined as deliberate intent to harm or break the law) that produce a loss are not covered.

Remember: as long as you are following the policies and/or guidelines of your organization and are acting on behalf of your organization, your interests will be protected by the insurance policy.

When a member or volunteer is injured during a sponsored event or at the chapter house, they need to rely on their own medical insurance to pay for their injuries, unless the organization is grossly negligent in causing their injuries. The General Liability policy exists to defend the organization’s members and volunteers should they be named in a lawsuit. It is not a substitute for a personal medical insurance policy.

Under the insurance program, the fraternity/sorority is covered under host liquor liability coverage, which is similar to the type of coverage under a homeowner’s policy. This coverage protects an insured should they be named in a civil lawsuit in which someone was injured due to the consumption of alcohol. This coverage will respond as long as the courts interpret that the insured is not in the business of serving, selling, manufacturing, furnishing or distributing alcoholic beverages.

Remember: It is extremely important that all members of the fraternity/sorority follow the organization’s alcohol policy.

We discourage the practice of scavenger hunts because of the inherent risks from both an automobile and general liability standpoint.

Some of the inherent risks include the following.

For the automobile exposure:

  • event requires speed to compete in the competitive event
  • drivers may be traveling on unfamiliar roads/streets
  • driver can be distracted by passengers excited with the “race” or hunt
  • tendency for alcohol to be involved in the event

For the liability exposure:

  • event requires participants to travel where they may not be familiar
  • potential exists of hazing influence
  • tendency for alcohol to be involved in the event
  • many times the event has a fraternity as a co-sponsor and there is less confidence in the other organizations’ insurance coverage and risk management procedures
  • liability waivers of responsibility that the participants may sign are less likely to hold up under challenge

In addition, many of our clients have policies that forbid scavenger hunts, so, as always, be sure to check with your specific organization before engaging in questionable chapter activities.

Each state has very strict guidelines for businesses who are licensed to sell alcohol, and we certainly recommend that you only use businesses that have a current liquor license. However, it is equally if not more important, that you require evidence of the business’ liquor liability insurance coverage, which is separate coverage from general liability insurance and will have a separate limit of liability. For much more information on this issue, please refer to our position paper.

Our concern with off-duty police officers is that it is unlikely that they carry their own General Liability and Workers’ Compensation coverage, so if something were to happen to them, the organization could be liable as the employer. We do not want to be in a position where an armed off duty police officer would be considered an employee of the organization, so a more practical solution would be to contract with a security company. In our opinion, security guards contracted by the organization should not be armed.

All Certificate requests must be submitted directly via this form at www.mjsorority.com. For more information on Certificates of Insurance, check out these resources that we’ve developed on our website: Certificate section of the Insurance SummaryReviewing Contracts document, Certificate section of the website.

Many chapter members have contacted us to find out if it is acceptable for them to provide babysitting services as a fundraiser or to just allow chapter members to baby-sit at the chapter facility. This exposure is not acceptable, and coverage is excluded from the insurance program. The chapter should not participate in or sponsor any activities related to childcare either at the chapter house or elsewhere.

The insurance company does not contemplate the difficult exposures involved with childcare in your General Liability rates. We do not support this activity because this exposure is not expected by the underwriting. In addition, the potential for physical and sexual abuse exists, chapter members are not necessarily trained appropriately, and the chapter houses are not furnished with children in mind.

Yes! Obviously, exercise equipment in the chapter house poses an increase in exposure to bodily injury claims for the House Corporation. If you do have exercise equipment, we recommend that you address its use in your housing agreements with each tenant member. In addition, we strongly encourage the House Corporation to have some kind of maintenance schedule in place to ensure that the exercise equipment is properly maintained and meets minimum safety standards.

Your organization has developed very sound and comprehensive operational rules and guidelines for your collegiate chapters, your house corporations and your alumnae groups. In addition, they have purchased the most comprehensive insurance coverage available to businesses, which has very few liability exclusions .This is very critical because volunteers who are making business decisions on behalf of their organization must be confident that they will be covered under the organization’s insurance coverage and not exposing themselves to personal liability. Saying it a different way, as you fulfill your fiduciary duty to the organization, they owe you the duty of personal indemnification should you be named in a lawsuit.

But now that we covered the insurance lingo, the question is: should you buy higher liability limits on your homeowner’s policy, buy a personal umbrella policy, and/or increase the limits of insurance on an existing umbrella policy?

The short answer is that we are confident in the insurance coverage of your organization; there is no need to address this liability as a volunteer under your personal homeowner’s policy or personal umbrella policies. We do know that many of the personal lines insurance policies include what is commonly referred to as “outside directorship” liability coverage under their homeowner’s insurance policy.

Here is an example of common wording:

Director’s Liability: Damage is covered if you or a family member is:

  • An officer or member of a board of directors of a homeowner, condominium or cooperative associate; or
  • Not compensated as an officer or member of a board of directors of a not-for-profit corporation or organization

We do believe that it is always important that you do carry adequate personal coverage, but make that decision on limits without the concern about involvement in your sorority/fraternity. We encourage you to consult with your personal insurance agent should you have any questions on whether your policy includes this provision.

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Miscellaneous Questions

Unfortunately, at this time, we only have a market for member organizations of the National Panhellenic Conference. We will update our website accordingly if that changes in the future.

We have had several questions about spray tan companies coming to the chapter house to offer their services to the residents of the chapter house. We recommend the following minimum guidelines for this practice:

  • Make sure the tanning area is tented and well-ventilated.
  • Just like with any independent contractor that comes on the chapter property, we recommend that you secure a Certificate of Insurance from the spray tanning company, as well as have a contract between the company and chapter. For more information, read this resource.
  • Allow only members to participate in the tanning activity; do not open the service to non-members or guests.

These recommendations also hold true for any other similar services that you might invite onto your property, such as a massage therapist, stylist, etc.

Pursuit of strong risk management will sometimes get in the way of solid business practices. A prime example of this is the reluctance of a house corporation board to have either collegiate chapter members and/or chapter advisors on the board because of the threat this could pose of not “fire walling” liability away from the HC of the chapter operations.

In that the chapter operations and house corporation operations are equally and jointly insured under your organizations national insurance policy, this should be less of a concern from a liability standpoint. We do believe that the increase in the communication between the two operations will be greatly enhanced, which ultimately provides for a healthier relationship between the two entities.

One possibility to help narrow this liability would be to have them as non-voting members of your local house corporation board and a minority in number. The local house corporation is taxed at running the most optimum business for its resident members/other members and using available resources to do so makes sense.

Due to the recent fire concerns surrounding hoverboards, we recommend that House Corporations prohibit the use and possession of hoverboards on chapter property.

From an insurance standpoint, alumnae are allowed to stay in the chapter house for controlled and specific events; however, they should be reminded that the same rules apply to them as to member tenants, (including no alcohol, smoking, use of illegal drugs, and/or male visitation) and that a House Director be on premises. We also recommend that the commercial kitchen be closed off for any event.

The current policy does not address the exposure of having an ATM on-site; however, the underwriters have not considered that as a possible exposure. Having an ATM would likely increase insurance rates because of the increased risks of burglary and theft. The safety of the residents is an additional concern, as unsavory characters could see that ATM as an easy target for theft and the members’ liability in their responsibility for it, should something go wrong. With the increased use of credit cards and online banking, as well as the abundance of ATMs in banks, on campus, in stand-alone kiosks and convenience stores, it is our recommendation that the risk isn’t worth the minor convenience that it might provide for your members.

The insurance coverage is very clear on this point. If you, as an insured, are aware of a theft, forgery, or other fraudulent, dishonest, or criminal act committed by this employee while employed by your organization, there is no coverage for this individual. If you chose to employ a person with a previous record of theft or forgery, he/she will need to be placed in a position where he/she does not have access to any funds. Additionally, if an insured becomes aware of a theft, forgery, or other fraudulent, dishonest, or criminal act committed by an employee involving money, securities, or other property valued over $25,000 prior to their employment with your organization, there is no coverage for this person under the Crime coverage.

We have been asked this question more frequently lately, and, yes, collecting social security numbers poses a huge financial risk to the organization. There are various levels of information that an organization can collect about its members, volunteers, clients, etc. Names and addresses make up the lowest tier of information. Social security numbers rank highest and must be properly secured. Most states have statutes in cases of data breach that obligate the organization responsible for collecting individuals’ information to pay for notification costs and, often, credit monitoring for the individuals affected. We are finding that the average cost per individual in cases of data breach is around $217; multiply that by your number of members, and you can see why we are concerned about our clients collecting social security numbers.

YES! We have literally hundreds of resources in our Library. Also, check out our e-modules on the following subjects: Contracts 101, Certificates of Insurance, Insurance Basics for Member’s Parents, Risk Management Module, and more. Send your suggestions for resources to Sara Sterley, Director of Risk Management Education.

NARCAN Nasal Spray is a prescription medicine used for the treatment of a known or suspected opioid overdose emergency with signs of breathing problems and severe sleepiness or not being able to respond.

We have discussed this as a department, and our position is a balancing act between expectations and liability. While there isn’t anything in the insurance policies that would exclude coverage for someone who was found negligent in either the administration or non-administration of NARCAN, our biggest concern is the responsibility that it places on the members who might be in a position to administer it. That said, if it becomes the norm on a campus that all residential units, including Greek Houses, have NARCAN, then that could become the standard that you would also want to abide by.

If you decide to move forward, then we recommend making sure the members understand that it isn’t foolproof. It would still be possible for someone to overdose on the property if no one is around to administer it, or if they don’t have the training to be able to safely deliver it. All of the members would need to understand that anyone who has been administered NARCAN still must seek emergency medical care, as the life‐saving effects of NARCAN can wear off before the drug leaves the victim’s system.

We would also recommend that if you are going to allow a chapter to have NARCAN, that it be the nasal spray, rather than the injectable, because there is a lower risk of injuring someone by administering it. Other things to consider include: is it readily available to continue to replace and is it cost prohibitive to do so?

Another thought has to do with what the chapter’s life-safety responsibility really is as a private organization. For example, is it the chapter’s responsibility to supply other life-saving items, such as Automated External Defibrillators (AEDs), EpiPens for allergic reactions, or even emergency insulin for diabetics that might be on the premises? Why just the supply of NARCAN, but not all the other emergency life-saving tools?

All this to say, MJ doesn’t have a firm stance or position either way. There is liability coverage for you should you decide to supply NARCAN kits, but it is our opinion that it is not your responsibility as a private organization. This is definitely a tough question! Hopefully some of the thoughts above help you in your decision, and should you wish to discuss the liability concerns further, please do not hesitate to contact us.

The short answer is, it’s not advisable. Apps like Venmo, Cash App, PayPal and Zelle, while convenient, pose risk in both the transfer of funds and the mixing of chapter funds and members’ personal accounts.

There are solutions, however, that manage potential risk and still provide the convenience of online transactions. Consider seeking out our partners to discuss alternatives:

For more detailed information about your organization’s potential exposure, take a look at the following article on the subject from our partners at Omega Fi.

Rule Right

Planning Events

The term “third-party” in our Certificate/Event Review Request Form refers to any entity other than the parties to the contract.

For example, if you have a contract with a facility to host an event, your organization and the facility are both parties to the contract. If a separate vendor is providing the alcohol, they would be a third-party. It is important that the third-party meets your organization’s risk management guidelines. Check with your sorority headquarters to learn more.

It depends on what exactly is required by the specific venue and the nature of the event. We require two weeks’ notice for Certificate of Insurance/Event Review requests in order to ensure timely delivery. Completing the Certificate of Insurance Request Form in its entirety is the best way of ensuring timely processing of your Certificate request.

No, Certificates of Insurance are all issued on an event-specific basis; therefore, each time someone requests a Certificate of Insurance from you, you must obtain another Certificate of Insurance.

No, MJ Insurance offers recommendations based on prudent risk management. Your national organization makes the ultimate decision as to the approval of your event based on your organization’s risk management policies and the specifics of the event.

We do have a list of risky activities that we find very concerning. For more information, read our position paper on the topic.

We recommend that you contact your Headquarters about your organization’s policy regarding their BYOB policies. Each organization has its own policies regarding alcohol and events.

We have developed the Reviewing Contracts 101 resource that will help you identify the common pitfalls that you should be aware of in dealing with contracts. The document, along with several additional resources related to planning events and contract review, can also be found in our website Library for future reference.

Cindy addressed this issue in a recent memo, which can also be found in our website Library for future reference.

When a member or volunteer is injured during a sponsored event or at the chapter house, they need to rely on their own medical insurance to pay for their injuries, unless the organization is grossly negligent in causing their injuries. The General Liability policy exists to defend the organization’s members and volunteers should they be named in a lawsuit. It is not a substitute for a personal medical insurance policy.

We discourage the practice of scavenger hunts because of the inherent risks from both an automobile and general liability standpoint.

Some of the inherent risks include the following

For the automobile exposure:

  • event requires speed to compete in the competitive event
  • drivers may be traveling on unfamiliar roads/streets
  • driver can be distracted by passengers excited with the “race” or hunt
  • tendency for alcohol to be involved in the event

For the liability exposure:

  • event requires participants to travel where they may not be familiar
  • potential exists of hazing influence
  • tendency for alcohol to be involved in the event
  • many times the event has a fraternity as a co-sponsor and there is less confidence in the other organizations’ insurance coverage and risk management procedures
  • liability waivers of responsibility that the participants may sign are less likely to hold up under challenge

In addition, many of our clients have policies that forbid scavenger hunts, so, as always, be sure to check with your specific organization before engaging in questionable chapter activities.

Each state has very strict guidelines for businesses who are licensed to sell alcohol, and we certainly recommend that you only use businesses that have a current liquor license. However, it is equally if not more important that you require evidence of the business’s liquor liability insurance coverage, which is separate coverage from general liability insurance and will have a separate limit of liability. For much more information on this issue, please refer to our position paper.

Our concern with off-duty police officers is that they are unlikely to carry their own General Liability and Workers’ Compensation coverage, so if something were to happen to them, the organization could be liable as the employer. We do not want to be in a position where an armed, off-duty police officer would be considered an employee of the organization, so a more practical solution would be to contract with a security company. In our opinion, security guards contracted by the organization should not be armed.

We encourage the use of liability waivers for certain types of events. Please refer to our position paper on this topic for further details.

All Certificate requests must be submitted directly via this form at www.mjsorority.com. For more information on Certificates of Insurance, check out these resources: Certificate section of the Insurance SummaryReviewing Contracts document, Certificate section of the website.

No Contract? That may not be a problem.

Contracts are legal agreements between two or more parties. It can be written or verbal and creates an obligation between the parties involved. The main reason you enter a contract is to protect your rights when you enter an agreement with another party. Those rights are more easily enforced when the contract is in writing and both parties have signed it.

We know that sometimes the venues and vendors that you work with don’t have a written contract in place to use for your event. In that case, they have made the business decision to operate with only a verbal agreement. While we feel that written contracts are helpful to better understand the services provided and the costs for those services, we don’t recommend that you try to draft a contract for the business relationship. If you aren’t comfortable with a verbal contract, you may prefer to do business with a venue/vendor who is willing to provide a contract that you can review and negotiate. You shouldn’t take that responsibility on for them; a licensed attorney should draft the contract.

Even without a written contract, there are terms that are set by either “common law” or legislation in your state to protect you as a consumer. For example, as your insurance provider, we are always concerned with who would bear the liability (who would be responsible to pay) should someone or something be injured or damaged during your event. Without a contract in place, it is assumed that you will be responsible for damage caused by your members and guests and the venue/vendor will be responsible for any damage that they cause, including if there is a defect within the venue that caused the damage or injury. Contracts may be used to transfer that liability – and that may or may not be in your favor, especially if the venue or vendor includes language in the contract that holds the user (your organization) responsible for any damage or injury, regardless of their negligence or fault.

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Property Questions

While fire drills are a good practice from an insurance perspective, they are not required to maintain coverage. There are no policy conditions that require fire drills or that would exclude coverage without fire drills being conducted. We recommend you follow the local/campus fire department’s recommendations.

It is always our policy for you to follow your policies – if your housing agreements state that there are no pets allowed, we encourage you to maintain that policy. We recommend that you contact your sorority headquarters to determine what your organization’s pet policy is.

We certainly would discourage large aquariums, as they can be difficult to care for properly (and in a sorority house we know that it can be difficult to enforce care for any item that is community property, without relying on the staff) and can cause considerable damage with water leaks, breakage, etc., if something goes wrong. Also, without the proper attention, aquariums can cause unpleasant odors.

Smaller fish bowls cause less of a concern from a potential property damage perspective but can still be problematic in the tight spaces that make up most sorority house residential areas.

Whenever there are physical changes (for example: renovations, additions, fire safety equipment, leak detection, etc.) to the chapter house, please inform your Client Executive. The national property policy is written on a blanket basis, based on the total values of all properties insured under your organization’s national insurance program, which is a significant benefit of being a client of MJ Sorority.

We determine those values in the following ways:

  • Discussion with the owner of the facility to determine either their recent cost to build, for new buildings or additions, or the projected cost per square foot to re-build their building as determine by a trusted contractor in that area or general information from the area
  • A comprehensive appraisal process, completed in 2008, that provided baseline values for each location. Each year we go through an analysis of the market and determine whether we need to do an inflationary increase across the board each year.

If your location has a California earthquake policy, those policies are written based on your specific location, so it is important that those limits are exactly accurate. Contact your Client Executive for additional information.

For more information, check out our House Corporation Inventory Checklist or contact us.

We do not have any specific policies or requirements for Automated External Defibrillators (AEDs) in chapter houses. They are starting to be so ubiquitous that people expect them to be around and, as we understand it, they are very easy to operate. As with any safety feature, it is important to manage expectations of parents/members/visitors so that there’s no guarantee from the chapter and that it is still a sorority house, not a health clinic. It will also be critical that members know and understand at all times that this is a medical device for emergencies only, and is not intended to be used as a toy or to be funny.

Click here for more guidance on the use of AEDs.

We do not have any risk management concerns with blood drives, as long as the chapter has gone through the proper event-planning procedures with their respective sorority and does not violate any of their sorority’s risk management policies.

Any time that you have extra people on property, you are increasing your liability – it’s just a matter of determining your risk tolerance. Contact your Client Executive with any specific questions.

We typically discourage members from having access to kitchen equipment beyond just a toaster, microwave, coffee maker, and refrigerator. This is particularly important in houses that have commercial kitchens because the stoves, ovens, and other large equipment can be tricky and unsafe to operate without special training. While we understand that there are many members who live in smaller residential-type houses around the country do have access to residential kitchen equipment, we are concerned that there are risks associated with allowing members even that kind of equipment – burns, leaving the oven on and setting fire, etc. As with most things, it is up to each organization to determine whether they are comfortable with the level of risk.

That all said, an electric range would be safer than a gas range because you avoid the chance of a gas leak or catching something on fire from the regular open flame.

We have had a claim in which Christmas lights that were wrapped around curtains on a curtain rod were left plugged in for several days (maybe weeks) and caught on fire. That said, string lights may be safe if members are willing to follow the safety recommendations, and using them doesn’t go against your organization’s internal policies.

We recommend similar safety precautions for Christmas trees and other holiday decorations. Review this resource from Travelers Risk Control for several risk management guidelines regarding the use of holiday decorations.

Like any electric appliance, electric blankets can spark fires in the home that damage property and threaten lives. To reduce your risk of fire when using one of these blankets, remind your members to do the following:

  • Switch the unit off when finished using it.
  • Inspect blanket daily for any signs of damage or wear, and replace blanket if you spot problems such as frayed wires.
  • Use and maintain blanket according to the manufacturer’s instructions, and replace it at least every ten years even it if still appears in good condition.
  • Make sure the electric blanket is plugged into a single outlet and not daisy-chained to one outlet, increasing the risk for overload.

There are some health conditions (pregnancy, diabetes, to name a few) for which doctors discourage the use of electric blankets. Make sure your member residents have cleared the use of an electric blanket with their health care provider.

Due to the maintenance requirements, fire safety concerns, and the health risks associated with tanning beds, we do not recommend tanning beds in the sorority house.

Keurig-type appliances are acceptable for use in the chapter houses, including the communal kitchen spaces. We recommend that chapters develop rules regarding their use to ensure that they are properly maintained.

We do not recommend the use of crock pots or slow cookers at the chapter house, unless they are used in the commercial kitchen by trained individuals.

Review this resource for further explanation about the difference between the codes regulating sprinkler systems.

As a general practice, we discourage use of space heaters in sorority facilities. Alternate heat sources cause the majority of residential-related fires, and keeping the women safe is our top priority. Additional concerns include combustible material getting too close to the unit, condition of the electrical system within the facility, etc.

We recommend that searches be addressed in your housing agreements. Refer to the Important Terms for Housing Agreements resource for additional information.

We have had several bunk-bed-related claims over the history of the MJ Sorority Department. We recommend the following risk management requirements when it comes to bunk beds in the chapter facility: bunk beds must be commercially manufactured, the top bunk must have permanent rails installed, and the bunk bed may not be placed adjacent to a window.

The insurance program does not have a candle exclusion; however, most of our clients have policies regarding the use of candles in the chapter facility, and prudent risk management suggests that candles should not be allowed in the chapter house. So many battery-operated alternatives are realistic and high-quality that it is our opinion that real candles should not be used in sorority-owned properties.

We recommend that chapter members take their personal property home at the end of each school year. The organization is not responsible for damage to members’ personal property at any time throughout the year. In addition, there is typically less oversight and more outsider traffic (with renovation and maintenance work) in the chapter house during the summer months, which makes it more likely for theft or damage to occur to any personal property left at the property.

From an insurance standpoint, we recommend that any snack/weekend kitchens available to members do not include hot plates, air fryers, crock pots, portable grills, ovens, stoves, and the like due to fire and burn concerns.

Having a microwave, refrigerator, and sink available would be acceptable. Any kitchen appliance, like a toaster, could pose an additional fire hazard if left plugged in.

Please contact us directly to discuss further, if necessary.

The current value of your contents or furniture as listed on your Insurance Overview document from MJ Sorority Division is the cost of replacing these items if they would be damaged or destroyed by an insured peril. In buying new furniture to replace existing furniture, you do not necessarily always increase the cost of the item that is already contemplated in the total value. If, however, your replacement is materially of a higher grade than that of what is being replaced, then notifying MJ would be prudent. As an insured, you are obligated to insure 100% value of your property, and the insurance company is obligated to replace it at 100% of the value.

If your location carries some form of property coverage, temporary storage is automatically provided under the national insurance program up to $1,000,000 per occurrence.

Video cameras on the exterior of your premises can be a good deterrent if you are having problems with vandalism of the property or of the exterior doors not being as secured as you would wish.

Interior cameras are another matter altogether, and the members’ right of privacy must be weighed against any pressing need to have interior surveillance.

Candle warmers (Scentsys, wax burners, etc.) are an alternative to candles that eliminate the open flame while still allowing for the fragrance aspect of candles that many enjoy. From a risk management perspective, we do not see a fire hazard risk with these types of appliances. However, the hot wax creates the potential for messy spills and burns. We defer to the local House Corporation to determine whether to allow these types of appliances on premises.

The insurance policy covers against loss resulting from necessary interruption of business caused by direct physical loss of or damage to covered property. The Loss of Income coverage will pay for the loss of rental income that a House Corporation may incur if members have to move to alternative housing due to the property being damaged by an insured peril. The policy will pay for equivalent temporary replacement quarters if you can no longer occupy the facility.

The insurance company will also pay for reasonable and necessary extra expenses incurred in order to continue as nearly as practicable the normal operation of the business. This could include increased costs of providing meal services, payroll, or any legal obligations by contract (for example, taxes or insurance).

Take all of the above into consideration when you determine whether you have an adequate limit of insurance for Loss of Income and Extra Expense. We recommend that, at a minimum, your Loss of Income/Extra Expense limit is equal to a year’s rental income. If you have trouble determining your Loss of Income limit, the annual average is $9,000 per live-in occupant. You may want to use that figure, multiplied by your number of occupants, if you do not have accurate rental income information.

Refer to your Insurance Overview to determine your location’s current Loss of Income/Extra Expense limit.

Property coverage under the sorority insurance program is written on a replacement cost value basis, which means that, in the event of a claim, the policy will pay the cost to repair or replace lost or damaged property with property of comparable material and quality on the same or another site, and used for the same purpose, without deduction for depreciation, deterioration, and obsolescence. Conversely, property insurance policies are often written on an actual cash value basis, which means that the policy will pay for the replacement cost of an item minus depreciation, which, depending on the item, can often be a high deduction.

We have developed the Chapter House Self-Inspection form (and the accompanying recommendations) for just this purpose. This form walks the user through a series of safety considerations throughout the chapter house. We recommend that the House Corporation perform the self-inspection on an annual basis. (Summer is the perfect time!)

Members’ personal property is not covered under the fraternity/sorority’s insurance policy. The organization’s insurance program covers chapter/house corporation property, not individual member’s personal property. We recommend that this is clear in your housing and membership agreements.

According to the recent University Housing Report compiled by FEMA, 76.5 percent of campus fires start in the kitchen. For that reason, we recommend that you limit the use of your commercial kitchen space to trained professionals.

As we see it, the equipment in the kitchen represents a significant financial expense for the property owner to purchase and maintain. The presumption by the insurance company is that the staff, who work with this commercial equipment, have been trained on the proper use of the equipment. This is the preferable way to protect this investment.

Indiscriminate use by untrained individuals not only puts the equipment at risk but puts the entire facility in harm’s way. Certainly a kitchen can be a high hazard area even for the trained personnel. Other risks include injury to the member while cooking in the kitchen and issues with proper food storage.

Ultimately the property owner must decide the manner under which their kitchen is utilized, taking into consideration other issues that emerge with respect to general chapter operations.

Go to www.floodsmart.gov, enter your address in the red box titled “One-Step Flood Risk Profile” along the lefthand side of the screen, and your flood risk will be generated. Please contact us if you wish to purchase flood insurance through the National Flood Insurance Program after determining your flood zone risk.

The insurance company’s loss control department discourages the installation of exterior wood burning pits or similar setups for the following reasons:

  • Such a device could possibly create sparks or burning embers, which could be captured by strong winds and cause a building and/or grass fire.
  • A fire that has effectively died down and is left unattended could actually still be smoldering and re-ignite, causing problems as noted above.
  • Igniting a fire brings a potential for burns, especially if a person pours a large amount of a highly flammable fluid onto the wood to start the fire, such as charcoal lighter (could be spilled onto their persons, making this a potentially critical situation).
  • Adding additional wood to a lit fire brings the potential for burns.
  • Portable pits may cause a number of problems, especially if they aren’t sturdy. If someone tries to move or push a portable pit while it is still burning or hot, it could fall over, resulting in a fire and/or burns. If the unit is initially positioned too close to a building or other combustibles and then lighted, it may cause a building or other uncontained fire.

We recommend that the use of outdoor grills fit into the following parameters:

  • Grills of any type should not be used on wood decks due to the fire risk.
  • Gas grills are preferable from a fire safety standpoint because they do not involve the use of flammable liquids, such as lighter fluid, or of hot coals during the grilling process. Hot coals also pose a disposal risk.
  • Gas grills are less safe during the lighting process. If excessive gas builds up in a closed grill before being lit, it can cause an explosion. Gas grills should always be lit with the lid open, and the gas tank should be turned to the off position following each use.
  • Instructions for use of the grill should be posted clearly next to the grill, and the use of the grill should be restricted to responsible persons who have been instructed on safety measures.

Typical smoke alarms last about eight to ten years, after which they should be replaced. Like most electrical devices, smoke alarms wear out. You may want to write the purchase date with a marker on the inside of your unit. That way, you’ll know when to replace it. We also recommend that you change smoke detector batteries annually.

For more tips about smoke detectors, check out this article.

Each state has inspection requirements for pressurized vessels or boilers being inspected by a boiler inspector on a regular basis. The tag reflects the status of your item with the state. Should you determine that the expiration date on the tag has passed, please contact Amy Sweet (amy.sweet@mjsorority.com) to assist you with this matter.

We have received several questions lately about how frequently House Corporations should update their insurance limits/values, so we thought it was a good time to address this and similar questions.

Contents: The contents limit is used to cover the property of the House Corporation. It covers the “stuff” the House Corporation owns either at their owned or rented facility. The House Corporation Inventory worksheet is a great place to start to determine your contents values. It also serves as a record of your inventory should a claim occur. 

Building: We typically look at this as a value per square foot of the chapter facility. We have learned from architects that specialize in Greek Housing that new facilities typically cost upwards of $300 to $400 per square foot to build. Current buildings may not quite rise to this cost, depending on finishes and costs in different locations, but should be at a minimum of $200 per square foot. It is not necessary to obtain an appraisal to determine value, but rather the best way to get an accurate ballpark value for the replacement cost of their building is to talk to a trusted local contractor and ask them to estimate what it would cost to build their facility in today’s dollars. Most contractors think this way and can easily give an estimate.

Loss of Income: Loss of Income covers loss of income suffered by a House Corporation when damage to its premises by a covered cause of loss causes a slowdown or suspension of its operations. According to our data, the average claim for Loss of Income is around $9,000 per occupant. That may vary, again, based on the costs in your area. We recommend that House Corporations consider their Loss of Income values at the greater of the $9,000 per occupant or the total income that they receive from members for room and board in an academic year.

Should you have questions regarding your locations’ Building, Contents, and Loss of Income limits, please do not hesitate to contact your organization’s Client Executive to discuss further.

As always, check with your national organization’s policies regarding smoking and vaping. While we do not have a position on electronic cigarettes, most of the incidents occur to a single individual with minor property damage. Sixty-one percent of the incidents occurred while the device was in a pocket and eighteen percent of incidents occurred while the device was being stored.

The US Fire Administration offers the following key points regarding electronic cigarettes:

  • The combination of an electronic cigarette and a lithium-ion battery is a new and unique hazard. There is no analogy among consumer products to the risk of a severe, acute injury presented by an e-cigarette.
  • Fires or explosions caused by the batteries used in electronic cigarette are uncommon; however the consequences can be devastating and life-altering for the victims.
  • It is likely that the number of incidents and injuries will continue to increase.
  • Since the current generation of lithium-ion batteries is the root cause of these incidents, it is clear that these batteries are not a safe source of energy for these devices.
  • Between January 2009 and December 31, 2016, 195 separate incidents of explosion and fire involving an electronic cigarette were reported by the U.S. media. These incidents resulted in 133 acute injuries. Of these injuries, 38 (29 percent) were severe.
  • To date, there have been no deaths in the United States caused by electronic cigarette fires or explosions.
  • One hundred and twenty-one (62 percent) of the incidents of explosion and fire involving an electronic cigarette or its battery occurred when the device was either in a pocket or actively in use.
  • The shape and construction of electronic cigarettes can make them (more likely than other products with lithium-ion batteries) behave like “flaming rockets” when a battery fails.
  • Lithium-ion batteries must be charged in accordance with the manufacturer’s instructions.

In the MJ Sorority Program, fifty-five percent of the property damage claims are due to water damage to your building and contents. For that reason, we have plenty of resources to help you reduce the risk of water damage at your chapter house:

Rule Right

Risk Control

The doors that open into any interior hallway, such as doors to cold dorms or to individual rooms, should be solid material and have a fire rating of at least twenty minutes in duration. During a fire, it is critical that the spread of smoke be delayed as long as possible, and these doors are the best deterrent.

An additional risk management recommendation to reduce the spread of smoke and slow down the spread of a fire is for every interior door in the chapter house to be self-closing. With this feature, the doors have a substantial impact upon exposure.

Self-closing can be achieved with your current doors via an inexpensive spring-loaded hinge that can be purchased at any hardware store for roughly one dollar a hinge.

Carbon monoxide gas is a product of the inefficient or incomplete combustion of fossil fuel. Poorly vented cooking appliances, furnaces, and water heaters are a few of these potential generators of carbon monoxide. This gas cannot be seen, smelled, or tasted, making it particularly dangerous. Carbon monoxide poisoning is the leading cause of injury or death by poisoning.

Refer to this video and resource for additional information.

See the automatic sprinkler article below for additional information on the use of heat detectors. We recommend that you use heat detection systems in your attic. Some additional reminders:

  • Be sure smoke and heat detection systems are UL Listed or FM Approved systems and have been properly installed by reputable, certified, alarm system contractors.
  • The National Fire Protection Association (NFPA), Standard 72, National Fire Alarm Code, is the recognized standard for ITM of fire alarm equipment.
  • Local or state fire codes may also be different from NFPA 72 and impose stricter ITM standards. The building owner or manager must be aware of the local and state fire codes. It is especially important to realize that if local and state codes are stricter than NFPA 72, then the stricter code applies.
  • Keep in mind a heat detector is just that: a detector. It will do nothing to extinguish a fire.

For additional information, review this resource.

Rule Left

Contact Us

If you have additional questions, or need clarification on answers offered here, please don’t hesitate to contact us.