Small Business and PPP

Everyone is touting Small Businesses are getting LOTS of help. But this is how it REALLY is!


The Paycheck Protection Program is not much help for the majority of “mom and pop” shops throughout the country, who are often sole proprietors or an LLC with few to no employees or mostly part-time employees. In my situation, we are an S Corp, where one owner is paid commission on his own booth sales and the other owner doesn’t get paid. Since we do not have employees, the PPP doesn’t work for us because 75% of the amount received must go towards payroll costs. The 25% on the PPP I could use toward utilities, rent and a few other costs would not have gotten me through even one month of expenses. I was hoping with the EIDL $10K advance, I may make it through two months if I was very careful.


At this time, we have been closed for one month. I have not heard from the SBA. The SBA has changed the original $10K forgivable advance to $1K per employee, making it nearly impossible for the small businesses across the country not to suffer terribly during this time.


We have many self employed vendors in our antique mall who rent space from us and we felt it was the right thing to do to waive their rent through this disaster, even though we are not receiving a waiver for our own rent.


Most small businesses will tell you: neither of the forgivable loan programs are accounting for the following:


  1. Monthly overhead expenses of businesses forced to shut down. These include mortgage payments, rent, utilities, commercial insurance, ongoing security, continued payments on POS software, advertising costs paid in March for ads scheduled for April, event cancellations, payments on seasonal merchandise that will sit until next year, bookkeeping and accounting fees, professional fees associated with fire alarm systems, property taxes, etc.


  1. Yes, small businesses want to keep their employees. Many of us have valued employees who have been with us for many years and it often takes us a long time to find people who are dependable to work for the wages we are able to pay them. But neither the PPP nor the EIDL is set up for the majority of mom and pop shops to do so, as explained above. If our employees are able to get unemployment, small businesses need help with monthly overhead to stop the financial bleeding that is occurring because of the forced shutdown. It is beyond our control that we have no income and only expenses at this time.


  1. In a recent MSNBC news clip on small businesses, it was stated that 54% of the nation’s economy is based on small businesses. Small businesses are your retail shops, restaurants, day cares, hairstylists, lawn care specialists, eye care centers, dentists, and so on…. Our nation has never asked these businesses to come to a sudden halt. Our entire economy is built on the backs and the sacrifices and dreams of people who often risk their entire life savings and all their time and energy into building their own version of the American Dream. It’s not only the small businesses that will be affected by this crisis, but the landlords and banks who receive rent/mortgage payments for their brick and mortar buildings, the wholesale supply businesses who sell product to them, the utility companies who provide services, the tech companies who provide apps and software, the credit card companies who make money off sales, the truck drivers who supply the businesses with their goods, and the millions of people who work either full-time or -part-time for these businesses. It’s so much more than we can even begin to imagine, and if this economy doesn’t open back up soon or if the government doesn’t provide either a solid financial relief or tax relief plan to enable these small businesses to stay in operation, I fear the consequences of this unprecedented situation will be far more dire than we can begin to fathom.


Most of the general public is concerned with either the stimulus checks or the ability to get unemployment during this time; but I find that most people have no idea how dire the circumstances are for small businesses who account for 54% of the nation’s economy. I just felt that it was my duty to speak up in the community and share my concerns about the survival of small businesses. Unless you own a small business, chances are you may not be paying attention to what little help is being made available to them. The PPP and the EIDL may be a good fit for many big small businesses, but they are offering very little to help the very small business owner. As a mall owner/small business owner who enjoys helping others realize their small business dreams with their own shops, I wanted to speak up and let everyone know that even though it appears as though small businesses are being helped, they really are not. I only hope the majority of them in our valley are able to make it through this – not only for the small businesses, but for the employees who work in those small ‘mom and pop’ shops!


On 4/17/20, the WCIRB put out the formal announcement which affirms earlier speculation. This is good news for our clients that have been impacted by the COVID-19 devastation.


  1. COVID claims will not impact the experience modification
    2. Payroll for employees staying at home, he WCIRB just put out the formal announcement which reaffirms our earlier email.  Please note the updated changes:
  2. COVID claims will not impact the experience modification
    2. Payroll for employees staying at home, not working, but continuing to be paid, will be excluded from reportable payroll.
    3. Employees working from home can now be moved to class code 8810, clerical.

    California appears to be ahead of many other States for these changes, but we expect other States to follow suit rather quickly.

Download WCIRB Wire Alert 4-17-20

If I Had a Crystal Ball

If I had A Crystal Ball – one person’s opinion

If I had a crystal ball and could have seen into the future to learn that a pandemic was approaching, would I have even been able to find or afford insurance to cover my economic losses? No, the coverage simply wasn’t available, at any cost, and as of today, it still isn’t.

My family and I are suffering economic hardship in similar ways to many Americans today. Last week, as my wife and I walked through a desolate and sparsely populated Seattle-Tacoma Airport, we turned toward one another and realized at that moment that every airport around the globe looked essentially the same. The experience was surreal, and it’s one that is as indelible as was 911 for me.

I don’t think our lives will ever be quite the same, but we will work to rebuild.

Insurance policies are legal contracts, like a lease agreement for a car, or rental property. In leases, the wording explains what you, the lessor is responsible for, and what your tenant is responsible for.

If you’ve leased a car to someone, you will expect them to cover damage to the car from a fire, theft or an accident. Likewise, if the person driving the car injures someone while operating it, you wouldn’t expect to be responsible for the injuries the driver caused to the injured people, would you? Of course not.

There are standard conditions that all of us brace for, a fire, a theft, an injury we accidentally cause to someone.

In these modern days, fires and car accidents are predictable by using computer modeling. But what about an earthquake or a flood? Earthquakes and floods are hard to predict, even with sophisticated computer modeling, and because of that, insuring these kinds of unpredictable things are expensive and not every insurance carrier has the stomach for it.

Most people make a conscious decision to save money on insurance by not buying earthquake or flood coverage. For those that do, the cost is quite high.

In more than 95% of the cases, insurance policies are designed to cover everything that’s not excluded in writing. The things that most of us buy insurance to cover are fire, theft, and liability for when we injure someone. There’s never a dispute if you buy a fire insurance policy, and you have a fire. You’re going to get paid. Not all loss causes are as cut and dried.

What if there is a war and huge sections of our country are destroyed? No Coverage

What if you go on a rampage and injure your fellow citizens?  No Coverage

What if you make and distribute a product that is determined to be unsafe to the public, and you are ordered to recall the product and reimburse everyone the price they paid for it? No Coverage – but in some cases, coverage might be available for an additional cost. These kinds of claims are rare and hard to predict, so the cost can be quite expensive.

What about Pandemic Insurance?

Pandemic Insurance just doesn’t exist in today’s marketplace. Just like after 911, an act of war that rocked our country and decimated vast sections of our infrastructure, coverage didn’t exist, Within a year, legislation had been passed to help protect Americans on a go forward basis and the cost to purchase Terrorism Insurance has since been spread across every policyholder in America.

We Americans will find our way out of these challenging times. Through the process of digging out we will become a stronger Nation, so long as we don’t turn on each other by placing undue blame on our Government or our Business Community.

Dana Coates is a semi-retired Risk Manager with an effective team to back him. Dana founded the company in 1996 and was mentored by some of the industry’s history makers. United Western Insurance Brokers, Inc., also known as UWIB, serves successful businesses and families, primarily in the Western US. With offices in Los Angeles and Seattle, UWIB is a fully digital agency which enables them to serve clients from anywhere, even when infrastructure has been disrupted. For a coverage evaluation on your business or your personal insurance portfolio, reach out to [email protected] . You’ll be contacted quickly by a real person who is seasoned and ready to work. Visit the company’s digital presence at