FRIDAY, FEBRUARY 15, 2013
Homeowners insurance protects your home, its contents, and, indirectly, your other assets in the event of fires, theft, accidents or other disasters.
A standard homeowners policy (known as an HO-3 policy) will protect you from things like fires and fallen trees. Notice how we didn't mention floods or earthquakes—those events are specifically not covered by a standard policy and require additional coverage. Homeowners in some areas of the country may be required by their mortgage company to carry these kinds of policies.
A standard policy will also protect your possessions from said disasters as well as theft. But a standard policy is not a blank check: There's a limit to how much you'll be compensated. If you have specific items of value, such as jewelry or artwork, you can pay a little extra each year to insure them for their full replacement value.
Now, if someone is on your property and slips and falls and sprains his ankle, he might sue you for his medical expenses. Homeowners insurance covers your liabilities in this situation as well. And like the examples mentioned above, you can pay more for extra coverage. Homeowners insurance isn't required by law, like auto insurance. But mortgage companies usually require you to obtain a policy before they'll give you a loan.
How Much Coverage Do You Need?
Your home insurance policy should cover enough to entirely rebuild and furnish your home were it wiped off the map. Ask a home builder to walk through your home and give you an estimate of what it would take to rebuild; that figure should be the basis for how much replacement coverage you'll need. Be sure to point out any unique and/or expensive details that would add to the replacement cost.
Once you've determined the replacement cost of your home, you'll need to know what kind of coverage you want. There are a few key terms here:
Guaranteed Replacement Cost Coverage. This means that the insurer will pay for the rebuilding of your home no matter the cost. These policies are hard to find these days.
Extended Replacement Coverage Many insurers offer coverage that caps the payout at around 125% of your home's insured value.
Inflation Guarantee (or Guard). This feature makes sure that your home's insured value stays current with the marketplace.
If you get a reliable appraisal, extended replacement coverage and an inflation guarantee, you should be in good shape. The appraisal provides a realistic starting figure and the inflation guarantee makes sure that your home's price stays current. The 125% coverage means that, even if construction prices outpace inflation, they probably didn't outpace it by 25%, so you should have enough money for whatever work you need done.
One last thing: The law requires you to have flood insurance if you live in an officially recognized high-risk area. To find out your flood risk and to find plans (which are offered by the government), go to floodsmart.gov.
When it comes to protecting your possessions, you may want more coverage than your standard policy allows. If you have anything of exceptional value (a family heirloom, a piece of art, jewelry, etc.), you should insure it separately. Insurers will charge extra for this coverage (something like an extra $10 on your monthly premium per $1,000 of value insured), but it pays to be covered.
Also keep in mind that there are two different kinds of coverage when it comes to personal articles. There's "actual cash value" and there's "replacement cost." You want coverage for replacement cost. "Actual cash value" is what you'd get if you sold your valuable today — a lower amount than what you initially paid. "Replacement cost" pays you the amount of money you'd need to buy a brand-new item to replace your old one.
Liability Coverage
Say a guest stays at your home and slips on the floor and sprains his ankle. He decides to sue you. Your homeowners policy includes liability coverage in case you lose the court case. Generally speaking, standard policies offer $100,000 to $300,000 of liability coverage.
Supplemental liability coverage can boost your protection to $1 million or more. If you don't own a car, adding that kind of coverage can be relatively cheap—less than $100 per year—and isn't a bad idea. If you do own a car (putting you at greater risk for causing damage to people and property), expect to pay $300 to $400 a year. Check out your auto policy to see what kind of coverage you already have.
Shopping for a Homeowners Policy
There are three kinds of home insurance companies and salespeople:
Direct sellers, who sell directly to consumers (GEICO, Progressive and USAA fall into this category).
Captive agents, who only sell one company's insurance products (for example, State Farm and Allstate agents).
Independent insurance agents, who sell policies from many different companies.
It's possible that all of these groups will deny your insurance application for anything from the risky pool of alligators in your backyard or the tornado that runs through your property every year. Don't despair. Many states have state-sponsored insurance programs for the hard-to-insure. Search for your state's FAIR (Fair Access to Insurance Requirements) plan if you're having a tough time with the traditional insurers.
Your Deductible
Like auto or health insurance, your homeowners insurance has a deductible (the amount you must pay before coverage kicks in). Like those other policies, you should opt for the highest deductible you can afford. If you do, the cost of your insurance premium (the monthly bill you pay) will surely be lower. Plus, a low deductible forces your insurer to cover more of your costs — costs they pass on to you in the form of increased premiums.
Remember: You should not use insurance to cover every conceivable expense, just the big ones. If reinstalling a gutter will cost you $200, pay the $200 — don't start filing claims for it. Insurers hate it when you file too many claims, and may raise your monthly premium or even cancel coverage because they'll view you as too risky. It's not about gutters—you want the insurance when you have to pay for a whole new roof.
A good rule of thumb to follow: If you can fix anything for less than $1,000, don't file a claim. -SOURCE-
FRIDAY, FEBRUARY 8, 2013
Winter driving can be tricky; the colder it gets, the more likely it is that roads can become slick. Even a road that's been sitting in the sun all day can turn into a hazard if water oozes onto it in the sunlight and then freezes when shadows pass over it.
Just last week, white out conditions on a freeway near Detroit caused a 30-car pileup that killed three and injured 20. People who weren't expecting anything—some of them creeping along at 30 miles per hour—ended up crashing right into the confused jumble of wrecked cars, jackknifed trucks, and spilled chemicals ahead.
The point is, you never know when conditions are going to take a turn for the worse, but if they do, here are a few pointers on how to stay out of trouble. Some of these things can come in handy in the summer, too, but winter throws an extra wrench in the works when temperatures plummet.
Hopefully you'll never have to find out what getting in a snowy (or any) pileup feels like. These simple tips can help.
1. Slow down
If conditions get wet, cold, and especially if you can't see well, dial back your speed a few notches. You don't want to be surprised by slow or stopped traffic ahead. Look what happened to all of those unfortunate Michiganders on I-75. But watch your six (that's the rear), too. There may be someone behind you whose reticent voice of reason has them truckin' like it's 80 degrees and sunny.
2. Traction is everything
You control your vehicle with steering, braking, and acceleration. When it gets slick, go easy on the accelerator, but also on the steering wheel and brakes. If you jerk the wheel in wet snow, the car will likely continue to go in a straight line even if the tires are turned all the way to one side. It's the most extreme type of understeer you'll ever experience. Braking, obviously, doesn't work well when the tires don't stick to the ground, so you have to start braking much sooner when the road is slick. Basically, observe tip No. 1 and try to plan your maneuvers in advance.
3. Keep on top of the weather
Most places in the continental U.S. experience cold snaps, at least occasionally, so ice and snow can become a problem faster than you think. Even in Southern California, a sudden onset of heavy rain or fog can cut visibility to nil and surprise motorists who aren't used to driving in bad conditions. It's a good practice to have an idea what the weather is going to be like year round, but it's especially important in winter, when a snow storm can put the kibosh on even a short drive. If you're planning a long trip, check weather reports frequently to make sure your route won't lead you through some impassable tempest.
4. Assume that other drivers are amateurs
This really depends upon where you live, but unless you're in some tiny Minnesota town where you're acquainted with everybody and know who can drive like a Scandinavian ice racer, don't give other drivers the benefit of the doubt. If you see another car coming, give it as much space as possible. When coming up behind another car, maintain plenty of distance between it and yourself. If someone decides to pass you in the dark on an icy blind curve, let 'em have at it. Slow down and move over so that if they do eat it, you don't get taken out, too.
Read The Other 4 Tips: Source
FRIDAY, FEBRUARY 1, 2013
The current estimate of vehicles damaged as a result of Sandy hit the 230,000 mark as claims processed by insurance companies have been analyzed.
New York has had the most vehicles affected by the storm with 130,000 while New Jersey generated 60,000 claims, according to the National Insurance Crime Bureau (NICB), which announced the revised estimates as provided by the Insurance Services Office Inc. (ISO), a subsidiary of Verisk Analytics.
The remaining 40,000 were reported from Connecticut, Delaware, District of Columbia, Maine, Maryland, Massachusetts, New Hampshire, North Carolina, Ohio, Pennsylvania, Rhode Island, Vermont, Virginia and West Virginia.
These are preliminary figures and may change as additional claims are processed. Moreover, there is no determination as to the extent of damage to these vehicles. They could have sustained minor paint scratches from flying debris, or have been under water for days and rendered total losses.
Read More: Source
MONDAY, JANUARY 21, 2013
Americans on average are living longer than in the past, but the lifespan gains lag those of other nations, the report found.
U.S. men ranked last when it comes to longevity – about 75.6 years compared to 79 years for men in Switzerland, the top-ranked country. U.S. women ranked next to last, living about 80.8 years compared to 86 years for women in No. 1-ranked Japan.
“This disadvantage has been getting worse for three decades, especially among women,” researchers said.
Americans fared better in some areas with fewer deaths from cancer and better control of cholesterol and blood pressure.
Understanding the reason for poorer outcomes despite the roughly $2.6 trillion, and rising, that the United States spends annually on healthcare is a major issue as the nation struggles to revive its economy.
“Shorter lives and poorer health in the United States will ultimately harm the nation’s economy as healthcare costs rise and the workforce remains less healthy than that of other high-income countries,” the researchers wrote.
While part of the problem is likely linked to the increased gap between wealthy and low-income Americans and higher levels of poverty overall, the report said that does not fully explain the U.S. disadvantage. The report noted that even educated, upper income Americans with health insurance “are in worse health” than similar people in the other countries.
The researchers said the United States should look at policies that work in countries “with superior health” to seek answers. Without action, they said, “the health of Americans will probably continue to fall behind.”
Read More: Source
MONDAY, JANUARY 7, 2013
In Chinese astrology, the year 2012 was the Year of the Dragon, a symbol of unpredictability and uncertainty. The dragon represents mystery because its head and tail cannot be seen at the same time, according to Chinese tradition.
So was the Year of the Dragon marked by mystery for the U.S. property/casualty insurance industry? Perhaps no more than any other year for an industry that is affected by both the weather and politics. The past year had its share of surprises, political as well as meteorological. But in terms of insurance markets and the economy in 2012, there was no great surprise, although there was frustration. By year’s end it was clear the dragon’s tail was a lot like the head —not what people had hoped for.
Every year has its ins and outs and ups and downs. Here is a recap of the insurance ins and outs and ups and downs of the Year of the Dragon 2012:
1. Roberts Rules
In what many thought a surprise, the Supreme Court said that Obamacare and the individual mandate were in keeping with the Constitution, which left employers trying to figure out what to do next and states having to decide whether to be in charge of their own health exchanges. A majority of states opted out, leaving the job up to the federal government. While health exchanges – and in some circles, Chief Justice Roberts– wentout of favor, accountable care organizations came into vogue and interest in consumer-driven health plans shot up.
2. Super Losses
The year started out with a lot of inclement weather in the Midwest and the South but then settled down. Then Hurricane Isaac’s downpour hit Louisiana and the Gulf states and Superstorm Sandy tore up the Atlantic seaboard. By the time 2012 was up, it was in the record books as one of the deadliest and costliest storm seasons. Sandy was downgraded from a hurricane, leading to a bit of an uproar over deductibles. Fortunately, private insurers and reinsurers were in a financial position to handle the losses without going out of business.
3. Hard-to-Define Market
Expectations for a traditional hard market were out. Many price-sensitive commercial insurance buyers were down as insurers drove up commercial insurance rates over the course of the year. Interest rates and investment income remained down so tighter underwriting was in favor.
4. Wet ‘n Dry
The flood insurance program was in and out before it was downsized and reformed. Then Sandy threatened to take it down to its last dollar. Meanwhile it was a year of record drought that threatened to wipe out crop insurers’ profits. Up and down the coasts, worries over property exposures continued to keep many up at night.
5. Day at the Breach
The risk of data breaches and cyber crimes continued to go up. Small business owners played down the need for cyber insurance. But risk professionals appeared to be more ontop of the issue.
Read More: Source
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