At least a few of the 365 days in 2015 will include a calamity or two for your bank.

Many will be small. A few might be large. Some that start small might morph into large.

Make sure your bank's insurance is up to the task of protecting your assets from the calamities.

Here are some insurance mistakes to avoid:

Mistake 1: Ignoring coinsurance penalties in your policies.

Coinsurance is a penalty inside many policies that can hurt you at the time of a loss. It's a penalty assessed when your insurance company thinks you are underinsured.

Ask your agent if you have coinsurance provisions in any of your property insurance policies. If so, ask why.

I have long held that having coinsurance penalties in an insurance policy is a good indication that your agent is not looking out for your best interests. Push hard to have the coinsurance penalties removed from your insurance coverage-and take a hard look at the quality of your insurance agent.

Mistake 2: Maintaining inadequate umbrella liability limits.

Umbrella liability insurance provides protection above and beyond the coverage included in your general liability, auto liability, and employer's liability insurance. It's an inexpensive way to increase your level of protection against someone suing you.

Premiums can be as low as $750 per $1 million of coverage. My minimum recommended limit for any bank is $5 million. (If your bank has over $300 million in assets, consider $8 million.)

The coverage is cheap, and the exposure can be huge. The most likely cause of a multi-million dollar lawsuit for a bank is an auto accident, probably an employee of the bank driving his or her personal vehicle. Consider the potential lawsuit against your bank if a vice-president driving her personal car hits a school bus.

Mistake 3: Having inadequate data-breach/privacy mitigation coverage.

Insurance agents have been (correctly) pushing cyber-liability insurance for several years. While I want my bank clients to have cyber-liability insurance, it's the second part of the policy-privacy mitigation-that I'm most concerned with.

If you have a data breach, you'll have to notify your customers. Expenses in mitigating a privacy event can reach $100 to $200 per breached name. Have a breach involving three thousand names and you have just spent between $300,000 and $600,000.

I see $500,000 of coverage as a minimum. Consider $1 million.

Several insurers are now expressing coverage in terms of a number of affected people. (One insurer provides coverage to notify up to 10 million individuals.) Your agent can get you information on your coverage and the cost of higher limits.

The extra coverage is almost always worth the relatively small premiums.

Mistake 4: Inadequate extra expense coverage.

Undoubtedly your property insurance covers the repair of a building damaged by fire or windstorm.

But how about the increased cost of operations for the six to eight months it takes to get you back into the building?

* How will you pay for rental of a temporary location?

* Or the cost of bringing in a mobile banking center?

* How about the cost of fitting out your temporary office quarters with power, phone, and internet connections?

Your branches should have at least $250,000 of extra expense coverage. Your main offices may need as much as $1 million.

Mistake 5: Tracking customer property insurance yourself.

Banks can no longer afford to track customer's insurance. Why?

The insurance is too cheap and the cost of outsourcing too low for your staff to take on this onerous task. Taking this off your plate will also make your regulators happier. (There is currently a regulatory hate-fest going on over force-placed insurance coverage.)

Talk with the insurance broker handling your force-placed insurance about alternatives to in-house insurance tracking.

Costs are as low as $6 per year, per mortgage for insurance tracking.

Mistake 6: Failure to understand the call-back exclusion in your bond.

Your bond insurer has certain expectations regarding how you will prevent funds-transfer fraud. A common policy provision is the requirement that you perform call-back verifications on transactions over a certain dollar amount. (Insurers often use your deductible as the threshold for requiring a call-back.)

Some insurers are adding additional warranty provisions. One insurer requires that call-backs be documented with a voice recording of the call-back. Understand the provisions in your policy. Talk with your agent. Negotiate the removal of onerous requirements.

Mistake 7: Not knowing about-and addressing-shared directors and officers limits.

Do lender liability or employment practices liability claims reduce your coverage for future directors and officers claims?

Many management liability policies have an aggregate limit that is equal to the limit of coverage for D&O claims. This has the effect of reducing coverage for future claims.

For example, if you have a policy with a $5 million aggregate limit, a $5 million D&O limit, a $2 million employment practices liability limit, and a $2 million lender liability limit, then a $1 million employment practices liability claim means there is only $4 million left available to pay a later D&O liability claim.

Check with your insurance advisor. Ask if your limits of coverage within the management liability insurance are separate. Show your agent this article.

Mistake 8: Not looking carefully at your bank's own flood insurance.

Your bank's package policy may include flood insurance. Many have an exclusion for locations located in flood zones. Some policies exclude locations where you could have purchased NFIP/FEMA flood insurance.

Ask your agent to detail for you which locations are included in flood coverage and which are not. Better yet, have your agent build a spreadsheet of your locations showing each location as a row. Columns should be the amount of property insurance, the flood coverage at that location, extra expense coverage at that location, and other coverage limitations that apply individually to buildings you use.

Mistake 9A: Not reviewing your coverage's employee dishonesty exclusions.

Your bond insurer expects that you will be diligent in whom you hire. Your bond includes restrictions of coverage that are automatically activated if an employee has committed a past dishonest act. These exclusions can be triggered by events many years ago that have nothing to do with employment or your bank.

I urge management to discuss known dishonest acts by any employee to assess the insurability of an employee. A shoplifting incident when a teller was in high school can mean no coverage if that teller embezzles from the bank.

Mistake 9B: Not understanding that employee dishonesty losses involve intent to defraud and personal gain.

Lately I have received a number of calls from bankers complaining that their bond did not pay for a loan officer who falsified documents so that a friend could get a loan.

You may wonder how this can happen.

The employee dishonesty coverage in your bank's bond pays for an employee stealing from the bank for his personal gain. There must be an intent to defraud or hurt the bank-and the employee must also realize a financial gain (or expect to gain) from the fraud.

No intent to defraud, no coverage-and no actual or expected personal gain, no coverage.

Mistake 10: Failing to review your bank's insurance annually.

You rely on your insurance agent to provide advice and insurance guidance. He is a resource you should be able to depend on. An annual review of your insurance coverage will help keep your coverage up-to-date.

Meet with your agent about 120 days before your insurance expires. Go over the coverage you have now and your agent's plan for the upcoming renewal.

Here are a few questions that can prompt useful actions:

1. Which insurers would you suggest we consider at renewal in addition to our current insurance company? Why?

2. What coverage limits should we consider increasing? What is your basis for determining if we have the right amount of coverage?

3. What are your three most pressing concerns regarding our insurance program? What coverages are we missing that we should have?

4. What actions can we take that will make us more attractive to insurance companies?

5. What trends do you see affecting our insurance over the next three years?

Your coverage isn't perfect-count on that.

What I've outlined in this article are just some of the issues I find when I review the insurance coverage purchased by a bank.

I have worked with over 400 financial institutions. Not once have I seen the perfect insurance program. On average I identify over 20 insurance issues to be considered and discussed in my coverage reviews. I think the record is 65 potential gaps and overlaps.

When we do get the policies straightened out, a renewal comes up and insurers change the policies they offer you. The insurance policies you buy this year are dramatically different from those your bank bought five years ago. Coverages change. New insurers come on the scene. The insurance marketplace evolves, devolves, improves, and regresses.

Share this article with your insurance advisor. It can start the conversation towards improving your confidence in your bank's insurance coverage.

BBB warning - be careful where personal and financial information is shared

TUCSON, AZ (Tucson News Now) - On July 23, law enforcement officials arrested seven suspects, from Russia to New York, after they allegedly hacked into more than 1,000 StubHub accounts and placed orders for over 1.6 million tickets.

According to the BBB of Southern Arizona this data hack was different from the one Target experienced in 2013; this information was stolen directly from consumers computers via viruses downloaded onto personal computers or through smaller data breaches on other websites. The victims of this StubHub breach have been notified and many have already received refunds. The BBB of Southern Arizona is reminding consumers to be careful and aware of where they share personal and financial information online, this stored information can easily be stolen by scammers and used to steal identities or empty bank accounts.

The BBB reminds the public to check their credit reports and bank statements regularly for unusual activity, as well as to make sure anti-virus software is updated. They are also offering the following tips to avoid falling victim to a data breach or identity theft:

Quick action - act fast to dispute the charges and limit liability; many companies have a 'zero' liability policy after reporting the loss or theft of a credit card, or when there is a data breach. Write a follow-up letter to confirm the loss was reported.

Know your rights - policies are not the same across all credit cards or debit cards, though federal laws protect both. Many credit card consumer liability is largely limited; if the loss is reported before the card is used under the Fair Credit Billing Act, you are not responsible for any charges you did not authorize. If the card number is stolen, but not the card, you are not liable for unauthorized use. Debit cards are protected under a separate Electronic Funds Transfer Act, protection is tied in to how fast the theft is reported.

Check with insurance provider - check policies (homeowners or renters) they may cover losses due to fraud.

Credit freezes/alerts - a credit freeze prevents any lender from accessing credit reports or scores as part of a credit application. For those who been a victim of ID theft or accounts have been compromised and an Identity Theft Report has been created, an extended credit alert can be placed on the account as well. A minimal fee may be required. An extended alert could last for almost seven years.

For more infomation visit our facebook page and follow us on twitter @DymanAssocIns.

Don't buy a tech device just as a new version comes out, David Pogue says.

Who doesn't want to save money? You've probably heard basic money-saving advice, such as never buy an expensive item on impulse. Wait a day or two and mull it over.

Then there's the old standby tip: Put aside your loose change from your wallet or pocket every day. At the rate of 50 cents a day, you would have a small emergency fund of $182.50 in a year. But making small changes can add up, too

AARP's fifth annual ''99 Great Ways to Save,'' published this month in AARP Bulletin, provides some interesting tips from experts in home improvement, finance, food, and more.

To see all 99 ways to save, go to aarp.org and search for "99 great ways to save."

Even if you've heard them before, it's good to be reminded how little effort some saving tips take.

Home improvement expert Bob Vila's tips include:

- Unplug it! ''Vampire'' electronics consume power even when turned off. A typical household can save $100 a year using smart power strips, which cut electricity to devices in standby mode.

- Install a low-flow showerhead. You won't even notice the difference, Vila says, because a low-flow fixture reduces the volume of water but does not affect the water pressure.

Yahoo Tech founder David Pogue offers these tips:

- Learn when new gadgets come out, so you don't buy something just before it's made obsolete. In general, a new iPhone model debuts each September, and a new iPad every November. New cameras come out in February and October, and everything else is timed for the holidays.

- Consider a prepaid cellphone. You pay before you make calls, instead of after you've made them.

- Talk to far-away family members using an app like Skype, which is available for smartphones, tablets, and computers, or FaceTime, for Apple phones, tablets, and computers. You chat for free over the Internet.

Jean Chatzky, AARP financial ambassador says:

- Shop around for insurance. Auto insurers have a tactic called ''price optimization.'' They raise premiums based not on your risk factor, but on how much of an increase they believe you will accept. When it's time to renew, ask your current insurer to do better.

- You can get your credit score for free at creditkarma.com and credit.com.

- At what age should you start collecting Social Security? The magic number is 80. If you're single and you think you will live past it, wait until age 70 to begin collecting, to receive the maximum benefit. For couples, as long as you believe one of you will live past 80, the higher earner should delay as long as possible.

Tips from Holly Phillips, internist and medical contributor for CBS News:

- Switch to generic drugs. The price is usually lower, as well as the copay.

- Don't smoke. Cigarette smokers pay more for insurance and require more medications and doctors visits. Cigarette smoking costs the United States up to $333 billion annually, including at least $130 billion in health care costs.

- Ask about independent facilities for radiologic tests. Having an MRI at a hospital costs an average of $1,200, but the same procedure at independent facilities costs about half that.

- Take advantage of wellness benefits. Many employers offer incentives for participation in exercise and other health programs. Insurance companies may offer a payment to those with gym memberships.

- Take your medications regularly. Many costly hospital visits are for conditions (like asthma or high blood pressure) that were managed well with medications until they worsened when the patients skipped doses.

Tips from Samantha Brown, AARP's travel ambassador:

- For cheaper flights, look to the earliest and latest flights of the day.

- For weekend travel, stay in a business hotel. The road warriors are gone and so are the high prices. These hotels will be in the business district, which isn't always the most vibrant part of town. But that's a small trade-off if you gett a good deal.

- Avoid conventions. Cities such as Washington, Las Vegas, and Orlando have the best hotel rates when conventions are not in town. Check out a city's official tourism website under Convention Calendar to spot the best times for a visit.

- Head to ski resorts in summer and beach locations in late August or early September.

- If hotel rates seem sky-high, there are often cheaper alternatives. Consider finding a room on sites like homeaway.com and airbnb.com; you'll pay less and feel like a local.

Medicare health coverage is fairly comprehensive. But if you need a lot of care, Medicare can leave you with significant out-of-pocket costs. That's why most people have some kind of supplemental insurance to help cover the costs that Medicare doesn't.

Choosing a supplemental plan that makes sense for you is not always easy. Here are some tips that will help.

What are the types of supplemental coverage?

About a third of people with Medicare have supplemental insurance from a former employer. If you are lucky enough to have this type of coverage, it is probably your best option. Be careful if you ever decide to drop it-you may not be able to get it back.

People with low incomes may qualify for their state's Medicaid program (and other related programs) that cover Medicare premiums and prescription drug costs.

If you don't fall into these categories, you may want to consider buying either a private Medicare supplement plan (often called "Medigap") or a Medicare Advantage plan. Both options have advantages and disadvantages, and you should do careful research before selecting one or deciding to change your current coverage.

What are Medigap plans?

Medigap plans work with original Medicare and pay costs that are left over after Medicare has paid what it covers. Depending on the plan, they pay for some amount of Medicare's deductibles and co-insurance. They do not usually offer additional services, so they will not pay for an item or service that Medicare does not cover. For example, they do not cover prescription drugs, so most people with original Medicare and a Medigap plan also buy a Part D plan.

Medigap plans are sold by private insurance companies. These plans come in several different categories, each designated by a letter: For example, "Medigap Plan F." Every plan with the same letter must offer the same benefits, so it is easy to compare plans from different insurers. In addition, these plans have to follow state and federal rules.

What are Medicare Advantage plans?

Medicare Advantage plans are different from Medigap plans. Medicare Advantage plans are run by private insurers that contract with Medicare to provide all Medicare benefits. Many of these plans include prescription drug coverage, and some plans also offer extra services that are not covered by traditional Medicare. Medicare Advantage plans usually have provider networks that limit which doctors and hospitals you can go to.

Medicare Advantage plans also have rules about what you will have to pay out of pocket that differ from the rules for traditional Medicare. Sometimes these rules are beneficial and can protect you from high out-of-pocket costs. For example, a Medicare Advantage plan may have a low copayment for office visits. But sometimes you may pay more for a service if you have a Medicare Advantage plan compared to traditional Medicare.

You have planned your holiday well; taken the train/plane to the nearest destination; found a good hotel and booked a car to take you to the exotic locations nearby. But when you have to pay for the rented car, you get the shock of your life. The final bill is way over what was advertised or what you expected. And then it becomes a brain-racking, loathsome exercise as you try to decipher the extra costs and charges that have been added to the bill while you continue to argue that those things were never mentioned in the first place.

Such incidents typically spoil the holiday mood, but you can actually avoid it and need not allow car rental to burn a huge hole in your pocket. Just follow these five tips and things will change for the better.

1. Try to research and book well in advance
If you are planning a holiday, you mostly book flights and hotels/resorts well in advance after proper research. Do the same for car rentals if you don't want to pay exuberant prices. You will find plenty of options and information online. What's more, you will also find numerous consumer forums on the Web where reviews and ratings of various car rental agencies are posted. Thus, it is best to decide and book in advance. You should have a good idea about costs and options before going.

2. Try to avoid booking from airports, major city markets
Many people book their cars from airports that are nearest to their holiday destinations. But it usually costs you more as car rentals present there will charge much more and some useless taxes will be added as well, depending on city limits. And the same thing happens when you opt for a car rental operating in the main city areas. They are bound to charge you more than the suburban car rental agencies. But those operating far away from established marketplaces like airports, bus stands and big hotels often face tough competition due to their out-of-city presence and their charges are usually lower than the city and airport-based agencies. Therefore, first take a cab to your hotel and settle down. Next, go to those car rental offices located at the outskirts of the city and hire a car for your entire trip.

3. Get the fuel policy right
Sometimes, car hiring services insist that you have to bring the car back with the tank full. If you are accompanied by a driver, the charges could be higher than self-driven rental cars. Some agencies opt for fixed charges for the first few hundred km covered and then a cost per kilometer travelled. But when the pricing also depends on the amount of fuel used and the fuel in the tank on return of the car, it is best to go for a full tank policy where you pay upfront for the total fuel in the tank at a fixed fuel rate per liter. It doesn't matter how much fuel you use on the trip. If you use more than one tank, you only have to pay for the extra at a petrol station.

But the full tank policy may not be too good if you are not going to use the entire tank. It means you will have to pay for the fuel you have not used. In such cases, go for the fixed charge plus the rate per kilometer one if you have a fairly accurate idea of the distance to be covered. Else, go for the full tank policy.

4. Beware of the insurance whammy
Car rental companies usually provide a standard insurance for the rented vehicle that states the standard charges to be paid as insurance. But at the end of the trip, you may get a punch of extra charges on account of stuff like damage to parts of the car like tires and windshield, which are not covered under standard insurance.

In order to insure against those additional damages to the parts of the car which are not covered by standard insurance, there is a provision called excess damage waiver insurance. This will insure you against damages to windshield, tires, etc. (these often occur if the person driving is not an experienced driver). But this is where car rental companies charge a huge amount, which can be double your total insurance cost. So it is important to read the entire insurance document before making the choice of the policy. Enquire about all possible terms and conditions before you pay up.

5. Photograph your car before and after the trip
Quite often, car rental agencies charge you extra for minor damages (at the sides or near the bottom are the most likely places) even though you have not caused them during the trip. However, there is no evidence to support your claim and you will end up paying the extra amount. It is, therefore, judicious to take proper photographs of the car before you start the trip and get them endorsed by the car rental people to determine the actual state of the car. Also take photographs just before the end of the trip and it will show that you did not cause those scratches or dents which were already there. Matching the two sets of photographs will help resolve any issue that the car company may try to raise in order to charge extra under the miscellaneous or admin costs.

Do the planning properly, based on the information gathered from the Internet and also garnered from other vacationers who had been at those destinations. If you do that, it will surely help you cut down on costs while hiring a car.

Insurers have exposed a record £1.3bn worth of fraudulent claims last year as the industry stepped up its war on cheats.

The amount, released by the Association of British Insurers (ABI), marks an 18% rise in value on 2012 and equates to £3.5m worth of insurance frauds being uncovered every day.

The ABI said there had also been a "significant" increase in people phoning up to report suspected fraudsters, indicating a growing acknowledgement that this was not a "victimless" crime.

In 2013, 118,500 bogus or exaggerated insurance claims were detected - more than 2,000 a week.

Fraudulent motor insurance claims were the most expensive and common to be exposed, with 59,900 dishonest claims worth £811m detected last year.

While there was a small fall in the number of detected frauds, their value had increased. The average fraud detected across all types of insurance products was worth £10,813.

The ABI said various industry initiatives were helping to "turn the screw on cheats". The Insurance Fraud Bureau (IFB) was created in 2006 by the industry to tackle organised cross-industry insurance scams.

The IFB is supporting police forces and insurers across the UK to investigate 110 "crash for cash" scams where motor accidents were deliberately staged, which on their own represent approximately £120m of financial exposure to insurers.

Investigations by the Insurance Fraud Enforcement Department, an ABI-funded dedicated specialist unit of the City of London police, have so far led to 470 arrests and 85 prosecutions since it was set up in 2011.

The ABI also said calls from members of the public reporting suspected insurance frauds into the IFB's "cheatline" rose by 32% to 6,060 in 2013 compared with the previous year.

A spokesman for the ABI said there appeared to be a "growing acknowledgement that (insurance fraud) is not a victimless crime, it's affecting people in their pocket".

He also pointed out that staged car accidents carried a safety risk to innocent members of the public. Sometimes, fraudsters would deliberately slam their brakes on so that an innocent motorist would hit them from behind, or they would flash their headlights to pretend that they were going to let a driver out of a junction and then deliberately hit them.

The rise in the average value of insurance scams could be seen as a reflection of the high-end nature of frauds by organised gangs that were increasingly being uncovered, the ABI said.

Since 2007 the value of dishonest general insurance claims being uncovered has more than doubled, with the number detected increasing by 30% during the same period.

Fraud is estimated to add up to £90 to the cost of everyone's general insurance policies.

Aidan Kerr, the ABI's assistant director, head of fraud, said: "The message is clear: never has it been harder to get away with committing insurance fraud; never have the penalties - ranging from a custodial sentence and a criminal record to difficulties in obtaining financial products in the future - been so severe."

The ABI said some recent examples of cheats being exposed included:

* Sixty people, including seven members of the same family, being convicted of a crash-for-cash staged accident fraud which involved more than £514,000 being claimed from 25 vehicle crashes alone

* A professional golfer who claimed £8,000 on his income protection policy for a knee injury that he said left him unable to work, but was caught on camera giving golf lessons. He was ordered to do 140 hours unpaid community work

* A woman was jailed for 22 months following a series of invented street robberies for items including laptops and designer clothes

* A vet was jailed for two years for inventing veterinary claims totalling nearly £200,000 for treating non-existent pets.

One insurer, AA Insurance, said that it identifies more than 100 attempts at fraud every week.

Simon Douglas, director of AA Insurance said: "These figures are encouraging because they reflect the growing success of the insurance industry in the war against fraud, rather than more fraud taking place."

He said: "This should send a strong signal to anyone thinking of trying it on.

"While you might not end up in prison, if an insurer finds that you have attempted to falsify a claim you'll find it difficult to obtain insurance cover in the future. Insurers don't like dishonest customers."

(Fox Business) - It doesn't make for the most pleasant dinner conversation but thinking about the financial impact of your death is important -- as is acting on it. From figuring out how much life insurance you need to sign up for the policy, it can be a confusing process.

Here are some tips to make you better at buying life insurance.

Know the Types

There are many types of life insurance policies, but they boil down to two main categories. Term policies cover you for a specific number of years, and if you die during that period, a set amount is paid out to beneficiaries. Permanent policies cover you for life and are typically more expensive. Permanent policies can be broken further into types like whole, universal and variable life.

Know Your Needs

It's important to really about what you want to accomplish with your life insurance. Your needs will be very different if you are just hoping to cover funeral costs compared to if you are hoping to pay off a mortgage and fund a child's college education. Sure, it would be great to leave your loved ones a lot of cash, but the higher the benefit, the more you are likely to pay in monthly premiums.

Compare Policies

Once you've figured out what you hope your life insurance policy will do for you, it's time to compare rates. This is so you can make sure you are getting the best rate for your needs. Look over the policies to be sure you are comparing the same coverage.

Make the Purchase

It's great that you are thinking about your long-term financial goals and your financial legacy once you are gone but until you buy the policy, you aren't covered! If you've determined that you need life insurance, the sooner you buy it, the better your rates are likely to be. (This is because younger and healthier people present less of a risk to insurers.) So, like any part of your financial plan, the planning is good but the execution is key. Then re-evaluate with any big life changes (marriage, divorce, having kids, buying a house, etc.) and even just every few years so the life insurance still fits your needs.

Paying taxes is rarely pleasant, but as April 15 approaches it's worth remembering that our tax system is a progressive one and serves a little-noticed but crucial purpose: It mitigates some of the worst consequences of income inequality.

If any of us, as individuals, are unfortunate enough to have income drop significantly, the tax on that income will plummet as well - and a direct payment, or negative tax, might even be received from the government, thanks to the earned-income tax credit. In this way, the tax system can be viewed as a colossal insurance system, guarding against extreme income inequality. There are similar provisions in other countries.

But it's also clear that while income inequality would be much worse without our current tax system, what we have isn't nearly enough. It's time - past time, actually - to tweak the system so that it can respond effectively if income inequality becomes more extreme.

I made this argument in 2003 in my book "The New Financial Order" (Princeton University Press). And now there is substantial evidence that inequality has been rising rapidly. In his monumental new book, "Capital in the 21st Century" (Belknap Press), Thomas Piketty of the Paris School of Economics documents a sharp increase in such inequality over the last 25 years, not only in the United States, but also in Canada, Britain, Australia, New Zealand, China, India, Indonesia and South Africa, with people with the highest incomes far outstripping the rest of society. The book is impressive in its wealth of information but it is short on solutions.

Professor Piketty talks about instituting a "global tax on capital" but acknowledges that it is a utopian idea and says that "it is hard to imagine the nations of the world agreeing on any such thing anytime soon." He talks about raising the rate of the top tax brackets and raising inheritance taxes but sees "little reason for optimism" that this will happen. There have been big increases in taxes on the rich in the past, but he points out that these tax increases were put in place only in response to wars - specifically, World War I and World War II.

Let's try not to have another major war. Instead, there are some positive things we can do now. As I said in my 2003 book, it would be wise to start amending the tax system immediately. I suggested this fundamental reform: Taxes should be indexed to income inequality so that they automatically become more progressive - meaning that the marginal tax rate for the highest-income people will rise - if income inequality becomes much worse. Ian Ayres of Yale and Aaron Edlin of the University of California, Berkeley, made a similar argument in 2011 in The New York Times.

There is a practical reason for starting now. If we wait until income inequality is much more severe, we will have a whole class of new superrich who will probably feel entitled to their wealth and will have the means to defend their interest. That's already gone far enough. We shouldn't let it become more extreme.

There is also a theoretical reason. It is what the psychologists Yaacov Trope of New York University and Nira Liberman of Tel Aviv University called temporal construal theory. They showed that people are more idealistic and generous when dealing hypothetically with the distant future than they are about actions they need to take today. That's why it pays to ask people to decide on measures to uphold egalitarian ideals when they don't have to cough up the money immediately.

In a draft research paper in 2006, Leonard Burman, director of the Urban-Brookings Tax Policy Center; Jeffrey Rohaly, also of the policy center, and I analyzed a kind of inequality-indexed tax system. (We called it the "Rising-Tide Tax System.") With the benefit of hindsight, we came up with a system that could have been put in place in 1979 - when inequality was much milder in the United States - and that could have prevented any increase in after-tax inequality through 2006.

Though our proposal worked in theory, we found that putting it into effect would encounter difficulties. For the system to be effective, the top tax bracket would have had to rise to well over 75 percent - a political nonstarter, in our view. We also believed that there would have been negative economic effects, including more tax avoidance. So we concluded that the proposal wasn't ready for advocacy. We held off from finishing and publishing that paper.

Today, though, there are some possibilities that might alleviate, at least partially, any increasing inequality in future years.

In testimony before the Senate Finance Committee last month, Mr. Burman proposed a version of inequality indexing that might be politically acceptable today. His idea was to integrate inequality indexing with inflation indexing: Instead of just linking tax brackets to inflation as measured by the Consumer Price Index, as we have done for years, he proposed that the adjustments also take account of rising inequality, if it occurred. He proposed a system to offset the loss in tax revenue that inflation indexing would produce, in a way that would get us closer to a target distribution of after-tax income; if inequality worsened, higher tax brackets would bear a bit more of the burden, and people at the bottom would bear less.

A relatively minor change like this should be politically acceptable. It is a reframing of inflation indexing, which is already a sacrosanct principle, and would be revenue-neutral. By 2025, Mr. Burman argued, it could pay for a doubling of the earned-income tax credit, "with more than $100 billion left over to adjust middle-income tax liabilities."

Such a plan would be a nice first step toward making our tax system manage the risk of future increases in inequality.

As a business owner it is sometimes difficult to know what insurance you need and how much of it to buy, so we've put together a guide to help you.



To start searching for business insurance cover, hit the 'get quotes now' button.

The type of insurance policy you buy may differ depending on the size and type of business you are running, your insurance budget and whether any of your customers have requirements about what insurance cover you should have.

To help you understand what's on offer we've summarized a few key areas of cover:

Public liability insurance

Public liability Insurance protects you against claims for compensation from people outside your business who have suffered an injury or whose property has been damaged because of your business. This could be something as simple as a visitor to your business tripping on a loose rug at your office, resulting in damaged knee ligaments and a claim for compensation.

It can also cover more serious claims resulting from construction accidents which cause serious damage to a building or injuries to a member of the public. Public liability cover will pay for the compensation and legal costs arising from accidents like this.

If you come into contact with members of the public - including your customers - either at their premises or yours you should think about getting a public liability insurance quote.

Employers' liability insurance

If you have employees, even part-time or on a short-term basis, you must buy employers' liability insurance - if you don't you are breaking the law. The cover protects you if an employee is injured or becomes ill because of their work. They may seek compensation from you and, depending on the type of injury or illness, payments can be very large. Employers' liability cover will pay for this compensation as well as the legal costs of defending the claim.

If you are an employer make sure that you stay within the law and buy employers' liability cover.

Property insurance

Most businesses would find it difficult to work without the tools of their trade or with no access to their place of work - whether you're a consultancy business and rely on your IT equipment or a plumber who couldn't work without their tools.

Could you afford to replace all of your business equipment or stock in the event of it being destroyed, lost or stolen? If the answer is no you should consider property insurance to protect your business building and assets.

When buying this cover, it is important to ensure that the sum insured on your contents list is equal to or greater than the value of your equipment; not just the items you think are important (so don't forget about the boring stuff like office chairs and filing cabinets). If you under-insure it's unlikely that you would get the full value of any items you claim for.

This also applies to your own or hired-in plant if you work in the construction industry - could you afford to replace it if you didn't have business insurance? If you do buy cover make sure you insure the plant to its full value.

If you own the building you work from you should make sure that it is properly protected. It's probably one of your major assets so you'll need to be confident you won't suffer financially in the event of a flood, fire or other event which damages your property.

Another cover to consider is business interruption insurance. This will make up for the money you lose if you can't work because your property has been destroyed, stolen or damaged.

Professional indemnity

Professionals are effectively selling their knowledge and expertise to their customers - you may be doing this in a number of different ways including providing advisory and consultancy services and producing designs.

If your client loses money because of a mistake you've made or because your work is late or not up to scratch, you may be faced with a claim for compensation. You might feel you have done nothing wrong but still be faced with significant legal costs to defend the claim.

Professional indemnity insurance can protect your business by paying for this compensation and legal costs.

What else do I need to know about business insurance?

You may feel confident that you know what insurance to buy but not how much. Your first thought should be whether any of your contracts stipulate how much business insurance cover you should buy - they will often require you to have a minimum level of public liability or professional indemnity insurance. If they do then this should be your starting point - although you may decide that you need more cover than the contract asks for.

For public liability and professional indemnity you will need to choose a limit of cover which is right for your business. Think about the type of work you do and what could go wrong in a worst case scenario - how much might it cost, especially if a dispute went to court. Buy a level of cover which you are confident will cover the cost of compensation you might have to pay.

Employer's liability insurance is required by law if you have employees and you must purchase a minimum of £5 million in cover - although many policies will automatically cover you for £10 million.

When buying property insurance the most important thing is to make sure you are not under-insured. Be sure to calculate the total value of all the entirety of your property - you can't pick and choose what you want to be covered.

To compare business insurance cover, please click on the "get quotes now" button.