How To Properly Insure Your Home!

Most homeowners have insurance in force.  If you have a mortgage the mortgage company requires you to carry property coverage to protect their interest in the home.  If you don’t carry coverage the mortgage company will place “forced placed” insurance on the dwelling that will cover the amount remaining on your mortgage.  Forced placed coverage can be as much as double the cost of homeowners insurance and doesn’t cover your equity in the home. 

How then, do you properly insure your home?  Many people look at the tax valuation of their home.  Many look at the market value (the amount they could sell the home for).  Neither of these numbers would put you back in the condition you were in prior to a loss.  You would need to insure your home for the amount it would take to rebuild the home, at your current location with current cost of materials and labor.  The cost of building materials – copper, steel, lumber, concrete – have all gone up drastically in the last few years. 

You should consider four elements  in deciding how much coverage you need:

1.        The cost to rebuild the structure.

2.       The cost to replace your contents.

3.       Additional living expenses if you are required to move out of the home while the repairs are made (accommodations and food).

4.       Your liability to others who might be hurt or injured on your property. 

Your agent will usually have a computerized estimator to help you estimate the replacement cost.  If you have had a recent  appraisal the appraisal usually has an estimated replacement cost .  You can ask a local builder to give you an estimate.  Whatever method you use get qualified help in coming up with the number.   

Your contents amount of coverage is usually based on a percentage of the dwelling replacement cost amount.  This could range from 50% to 70% based on actual cash value or replacement cost coverage.   If you have a contents loss you are responsible for providing an itemized list of possessions to the insurance company, along with proof of ownership.  If you own a movie camera it is a good idea to shoot a movie of your home (stand in the middle of each room and complete a 360 degree sweep).   If you have a regular camera or cell phone camera take pictures of every room in a similar fashion.  Keep your movie tape or your pictures at another location, such as a safety deposit box or at a relative or friends home.

If you are looking for ways to cut your insurance cost ask your agent for advice.  You can raise deductibles, add an alarm system, check to make  sure you are receiving all of the discounts (home and auto, 55 and over, etc.).  Don’t be pound wise and penny foolish by underinsuring your property!      

-Ron Darden

Umbrella Insurance - What Is It & Why Do I Need It?

Most people have insurance to protect their most important assets (your home, your vehicles, etc.) but do you have enough coverage to protect yourself from a catastrophic liability claim (a lawsuit)?

Umbrella policies provide you with an additional layer of liability protection over the limits provided by your home, auto, or business insurance. A single claim could hit you harder than you may expect. Owning a swimming pool, trampoline, dog or even having an inexperienced driver in your household could put you at a higher risk. Why? Because all these things not only increase the possibility a claim could occur they also increase the severity and expense of the claim when it does.

Accidents happen every day. For example - A driver in a rush on their way to work or late to pick up a child weaves around slower traffic and quickly switches lanes. Not realizing there was a vehicle in their blind spot they collide with the other vehicle causing severe damage to the car and breaking the hand of the other party involved who is a surgeon and now cannot work due to their injuries. The driver is held liable (financially responsible) and is required to not only pay the medical bills and vehicle repairs but also the lost wages (current and future) and pain and suffering of the injured individual. When you consider the most coverage the average person carries on their auto policy is between $50,000 to $100,000 this would easily exceed their auto insurance liability limits. So where does the money come from to pay the rest of the judgment? If you don’t have an umbrella then you guessed it. Out of your pocket!

An umbrella policy would also protect you from someone being injured on your property. For example - A guest at your Childs pool party dives unknowingly into the shallow end of your pool and suffers severe injuries. You are sued and held responsible. Only having $300,000 in liability coverage afforded under homeowners insurance may not be enough for legal representation and the settlement. You want to take a guess where the money comes from after the insurance runs out? Without an umbrella you guessed right again. Out of your pocket!

Having this additional liability coverage could protect you from life’s unexpected accidents. The peace of mind knowing you are protected is well worth the inexpensive premiums of umbrella insurance. Typically umbrella policies cost as little as $125 to $200 a year at most. Contact an agent today to discuss your risk and how affordable it is to have this valuable protection.

Renting A Car? What You DON'T Know Can Hurt You!

Do I really need rental car insurance?  What does my current policy cover?

These are two of the more frequently asked questions I receive from my auto insurance clients. Probably because properly insuring a rental car can be confusing and frustrating at times.  Many rental agencies offer “damage waivers” for anywhere from $15-$25 a day (selling peace of mind along with extended coverage’s). Here are a few tips about Collision Damage Waiver(s) also known as Loss Damage Waivers to make your experience a little easier and less costly:

·         A Collision/Loss Damage Waiver is NOT an insurance product; however it “waives” the renter of financial responsibility if the rental car is damaged or stolen. So in other words, if you chose not to select this option you (the customer) must pay the rental company the full cost of repair, lost revenue, plus administrative charges.  

·         In most cases waivers provide coverage for administrative fees such as “loss of use” (the cost/money the rental car company loses by not being able to rent a damaged vehicle while it’s being repaired) and “diminished value” (the amount a rental vehicle’s resale value goes down/diminishes due to a damage caused by you). DEPENDING ON THE INSURANCE COMPANY INSURING YOUR VEHICLE YOU MAY HAVE ONE, BOTH OR NEITHER OF THESE COVERAGE’S AS PART OF YOUR POLICY OR YOU MAY BE ABLE TO HAVE THEM ADDED BUT YOU WON’T KNOW UNLESS YOU CALL. 

·         Often time’s waivers become void if the accident was caused by speeding, driving on unpaved roads or driving while intoxicated. This could leave you (the customer) being completely, financially responsible.

BEFORE renting a car please make sure you make at least two very important calls!

1.  CALL YOUR INSURANCE AGENT - to verify you are not duplicating coverage. Your current liability coverage, collision and comprehensive deductibles may apply when renting a car. However, you may still have some gaps so it is always best to call your agent.
2. CALL THE CREDIT CARD COMPANY you will be using to rent the car. Insurance benefits offered by a credit card company differ by the company, the level of credit card being used, as well as a host of other possible criteria.  Credit card companies may cover only damage or loss of a rented car, not for other vehicles involved or personal belongings or may not provide any coverage at all.

If you plan on renting a car in another country, contact your insurance agent and your travel agent to find out what you need to do to be properly insured.  If you are renting a car abroad, you may also need an international driver’s license.

As with all insurance products it’s better to be safe than sorry and to know how you’re covered BEFORE a loss occurs. That’s another valuable reason to find an independent agent today. We’re here when you call!

-Amanda Ray

Workers Compensation - What You Don't Know Could Hurt You!

Workers Compensation law started in Germany in 1884 under the name "Sickness Insurance". It paid to all private wage earners for up to 13 weeks for work related injuries. In the case of disability, wages were paid by a state guarantee fund after the first 13 weeks. The German Workers Compensation system has been taken as a model all over the world.

Maryland was the first state to pass workers compensation law in 1902 with all states having something in place by 1949. Today workers compensation is still administered on a state by state basis, but all states work with the same basic premise; to pay for the rehabilitation, recovery and medical bills of an employee work related injury. It can also pay for lost time when they are off work due to that work related injury. Workers compensation insurance is not meant to replace health or medical insurance, workers compensation insurance is only for on the job injuries.
　According to the Industrial Commission in the state of North Carolina, if an employer has three or more employees (including an owner) it is the law that the employer has Workers Compensation Insurance. So what if an employer has less than three employees? What if they are hurt on the job? Does that mean the employer is not responsible?　What if you are an employer and file 1099's on the people who do work for you? The employer would assume they are independent contractors and would ask why there is a need for workers compensation insurance if there are no other employees. But what does the North Carolina Workers Compensation Laws say in each of these instances? Is the employer responsible or not?

The simple answer is YES! The employer is responsible for indemnifying the employee in each of these instances. You have a small upstart business and only have one employee, what happens if they fall off the step stool while putting stock away and twist or break something? What if you are a contractor and have a 1099 person whom does not have their own workers compensation insurance and they get paint splashed in their face while doing a painting job for you? By not being informed, the medical bills could cost the small start up business their bottom line or worse.

If you have specific questions on Workers Compensation Insurance, you should contact your local independent agent for answers on how this type of insurance works.

- Amy Frobish

New Year, New Stuff...New Insurance? Are You Covered?

With Christmas coming to an end and a New Year beginning, it’s time to get organized! I’m sure everyone has an inventory (at least in their minds) of all their newly received toys from the holidays. So what about everything else? If you had a loss (i.e. fire, theft, tornado, hurricane or just lost something, etc.), would you know what you had so you can get it back? Would it even be covered by insurance?

Preparing an inventory for your belongings can help accomplish multiple things. First, it will make the process of filing a claim, should you ever need to, a more organized process. It will also help you to determine whether all your belongings are adequately insured. The limit for theft of guns/firearms is 10% of your contents coverage with a maximum of $10,000. You can add an endorsement to broaden and increase this coverage to include misplacing or losing. Theft of jewelry/watches/furs is also limited. In some cases policies only allow for $1500. THAT’S IT!  This can be endorsed to broaden and increase coverage for the actual value of the items and will also included misplacing or losing.

So “what’s next” you ask? Here are a few things you can do:

·         Make a list of your belongings and include any purchase receipts if you still have them (especially for big ticket items like refrigerators, TVS, etc.).

·         Photograph and/or videotape your belongings by room. This will allow you to see details of items you may not remember from a list of that you don’t have purchase receipts for.

·         Keep a copy of our disk, tape, photos, etc. in a separate fire proof, locked location.

·         Get a copy of these inventories to your insurance agent.

·         Update your inventory at least annually and if you need to, purchase additional insurance for those items valued higher than your policy maximums listed above.

If you have questions or are unsure if you have enough coverage, call your local agent to discuss your coverage in detail. From everyone here at Darden, Miranda and Associates, Happy New Year and happy “inventorying”!

-Caroline Miranda

Does A 15 Minute Insurance Call Save You or Cost You?

We’ve all seen the commercials right? "…X number of minutes could save you X% on your auto insurance…" Or perhaps it’s a spokesperson (let’s just call her Flo-rida for purposes of this discussion) standing in what appears to be an insurance retail store selling insurance for your car, boat, motorcycle or RV by picking up a box off of a shelf. I applaud the creators of the commercials because from a marketing stand point they are hitting the target to get the phones ringing and the doors swinging for quoting insurance. The question however is whether or not that potential proposed savings is costing you more in the long run…in terms of both coverage and money?

The truth of the matter is that insurance is not a commoditized product that you can "do it yourself" by picking it up off of a shelf. And the idea that 15 minutes is adequate time to determine whether or not the minimum required limits of liability are sufficient to protect you, your family and other drivers is ludicrous at best. I can promise you after being on the other end of hundreds if not thousands of claim phone calls that I have never once been asked about the monthly bill amount by someone who has been in an accident that totaled cars or lives. One of the first questions is "…am I covered…" which is usually followed up by "… how much will my insurance pay/cover…".

There are always ways to cut premiums and reduce your cost of insurance but sacrificing coverage (which is the strategy these companies are proposing) should NEVER be one that is the determining factor. Take for example the driver who looked away for an instant to change the radio station in their car not realizing they were drifting ever so slightly into the next lane. They ultimately tapped the rear driver side of the car beside them and sent them into oncoming traffic. Four vehicles and a fatality later that driver who was innocently doing what all of us do on a daily basis is facing hundreds of thousands of dollar in liability and property damage costs. Their "15 minute" limits don’t even come close to being enough so now their personal assets (home, savings, investments) all come into play in a court of law and if there is not enough assets to pay then the other party’s attorneys will be quick to post a judgment against you until their clients costs are satisfied. This is a real life scenario.

So how do you maximize the most savings possible is you’re not reducing coverage? Make an appointment and sit down and a talk to a live agent about your entire insurance strategy not just one product. Leverage the multi-policy discounts most companies offer (discounts for insuring you home, car, and other items with the same company). Find out about umbrella policies that can protect you in the event you do use your limit. Find out about life insurance discounts on your home and auto policies. But most importantly build a long term relationship with an agent. You can shop for a better rate at every renewal but over time you will not save money. In most cases when you factor in the time spent shopping you will end up paying more in the long haul. Insurance premiums are a roller coaster. If you can find an agent and agency you trust they can help navigate you through the ups and downs so that in the long run your costs remain constant. That doesn’t mean you might not pay more during some policy terms than others but over a period of years your median costs will be far closer to level than those who are continually jumping from one company to the next. Not to mention that the easiest way for you to have a loss that doesn’t get covered is to have policies with multiple agents in different places because it’s impossible for them to really understand all your risks and exposures and how to best advise you.
Lastly, if you haven’t already you should consider an independent agent. We have the advantage of having multiple companies at our disposal so if you really do have a reason the test the insurance waters they can do the work for you with the other companies in their agency. Remember, just because your current agent may not be able to provide you with choices doesn’t mean you don’t have any.

-Bryan Miranda