Thursday, July 15, 2010

"My $90,000 Car Isn't Covered By Your 15 Minute Insurance"

The good news: Last month you spent the 15 minutes needed to save $15 a month on your car insurance...hooray, that's $180 per year (that's a whopping 50 cents a day!)

The bad news: This month you rear-ended a jerk with a seriously bad attitude driving his $90,000 ego (his car) and now you're about to find out how good your 15 minute insurance coverage really is.

So what's REALLY important when it comes to your car insurance?  Saving $15 a month is nice, who wouldn't want an extra $180 per year in their pocket, but is saving $15 a month that important when your thinking about your insurance? Here are a few things of even greater importance to consider when buying your car insurance:
  1. In Colorado, if you cause the damage you pay the bills. If you do not carry enough insurance to cover the costs (like the previously mentioned $90,000 car) than the rest comes out of your pocket. Carrying lower liability limits (one way the 15 minute insurance companies use to lower your rates) is only smart if you never have an accident and who knows if you'll ever have an accident - that's why there called "accidents and not "on purposes."
  2. The number of uninsured drivers in Colorado is on the rise and reaching record numbers. If one of them hits you and you can't work for a month, what's the chance they're going to have enough money to cover your medical bills, work loss and pain and suffering? Yes, they owe you the money but if they can't even afford to pay insurance you're probably not going to get much out of them. Carrying higher uninsured motorist coverage is a wise idea in this era of increased uninsured drivers. Providing lower coverage is another way the 15 minute insurance providers lower your cost)
No agent, no guidance, no help with choosing the right coverage to protect you from the over paid jerk in the $90,000 car that you just rear-ended. Sometimes 15 minutes COSTS you in the when you're being sued for the things you new insurance policy doesn't cover.

Talk to a local, professional agent to find out what coverage you do and do not need to get the best insurance value - the PROPER coverage for the best price.

Robert Edgin

Wednesday, July 7, 2010

Tips For Insuring Your Home - The Structure & Personal Property

Insurance is something most people don’t even want to think about until they need it the most. But, understanding what is and isn’t covered in your homeowners insurance policy can mean the difference of being able to rebuild your home and replace your personal belongings. Homeowners need to do annual insurance policy "check ups" to make sure they keep up with local building costs, home remodeling and inventories of their personal belongings.

The typical homeowners insurance policy covers damage resulting from fire, windstorm, hail, water damage (excluding flooding), riots and explosion as well as other causes of loss, such as theft and the extra cost of living elsewhere which the structure is being repaired or rebuilt.
Your policy also covers your legal liability (up to policy limits) if you, members of your family or even your pets hurt other people or their property, not just in your house, but away from it, as well. Click here for more information on general liability coverage and umbrella policies.
When you insure your home, you are really insuring two distinct things:

1. The Structure
2. Your Personal Property

There are three options to insure the structure of your home:

1.Replacement Cost. Insurance that pays the policyholder the cost of replacing the damaged property without deduction for depreciation, but limited to a maximum dollar amount.

2.Extended Replacement Cost. An extended replacement cost policy, one that covers costs up to a certain percentage over the limit (usually 20%). This gives you protection against such things as a sudden increase in construction costs.

3.Actual Cash Value. This covers the cost to replace your home minus depreciation costs for age and use. For example, if the life expectancy of your roof is 20 years and your roof is 15 years old, the cost to replace it in today’s marketplace is going to be much higher than its actual cash value.

Tips for Insuring Your Home to Value

You should insure your home for the total amount it would cost to rebuild your home if it were destroyed. That’s not the market value, but the cost to rebuild. If you don’t have sufficient insurance, your company may only pay a portion of the cost of replacing or repairing damaged items. Here are some tips to help make sure you have enough insurance:

•For a quick estimate on the amount to rebuild your home: multiply the local building costs per square foot by the total square footage of your house. To find out the building rates in your area, consult your local builders association or a reputable builder. You should also check with your insurance agent or company representative. (Note: This is only an estimate and shouldn’t replace annual coverage reviews).

•Factors that will determine the cost to rebuild your home: a) construction costs b) square footage of the structure c) type of exterior wall construction—frame, masonry or veneer d) the style of the house (ranch, colonial) e) the number of rooms & bathrooms f) the type of roof g) attached garages, fireplaces, exterior trim and other special features like arched windows or unique interior trim.

•Check the value of your insurance policy against rising local building cost EACH YEAR. Check with your insurance agent or company representative if they offer an "INFLATION GUARD CLAUSE." This automatically adjusts the dwelling limit when you renew your policy to reflect current construction costs in your area. However, you still should keep up with local building costs by checking in periodically with your local builders association.

•Check the latest building codes in your community. Building codes require structures to be constructed to minimum standards. If your home is severely damaged, you might have to rebuild it to comply with the new standards requiring a change in design or building materials. These generally cost more.

•Do not insure your home for the market value. The cost of rebuilding your home may be higher or lower than the price you paid for it or the price you could sell it for today.

•Most lenders require you to buy enough insurance to cover the amount of your mortgage. Make sure it’s also enough to cover the cost of rebuilding.

•Advise your insurer and increase the limits of your policy if you make improvements or additions to your house.

Two ways to insure your personal belongings:
1.Replacement Cost Coverage. Insurance that pays the dollar amount needed to replace damaged personal property with items of like kind or quality without deduction for depreciation.

2.Actual Cash Value. Insurance under which the policyholder receives an amount equal to the replacement value of damaged property minus depreciation. Unless a homeowners policy specifies that property is covered for its replacement value, the coverage is for actual cash value.

Here are a few things to keep in mind when you’re insuring your stuff:

•Check the limits of your policy on personal items, such as jewelry, silverware, furs and computer equipment. If the limits are too low, consider buying a special personal property endorsement or a "floater." An endorsement is an addition to your policy. A floater is a form of insurance that allows you to insure valuable items separately.

•Make an inventory of everything you own in your home and in other buildings on the property. Write down major items you own along with all available information, such as (a) serial numbers (b) make and/or model numbers (c) purchase prices (d) present value (e) date of purchase. Click here for more on home inventories.

•Document your inventory. Take either still or video pictures and attach receipts to the inventory when available. Store the inventory and visual records AWAY from your home—perhaps in a safe deposit box.

•Update the inventory when you make major purchases.

The most important thing you can do to safeguard your home and property is to understand that your insurance policy is a contract and you need to know what’s in it. Your insurance agent or company representative will be able to walk you though it and answer any questions.

The bottom line: Don’t put your policy up on a shelf somewhere and let it collect dust! Review your policy every year.

Colorado Hail Storms - What You Should Do

Last year's hail season was the most expensive in Colorado History, causing $1.3 Billion dollars in damage across the state. Below is some great information posted on the RMIIA website.

Colorado Hail Statistics

Colorado’s damaging hail season is considered to be from mid-April to mid-August. Colorado’s Front Range is located in the heart of "Hail Alley," which receives the highest frequency of large hail in North America and most of the world, so residents usually can count on three or four catastrophic (defined as at least $25 million in insured damage) hailstorms every year. In the last 10 years, hailstorms have caused more than $3 billion in insured damage in Colorado. As a result, up to one-half of your homeowners insurance premium may be going toward hail and wind damage costs. If you carry comprehensive coverage on your auto policy, hail damage is covered by almost all insurance companies. Comprehensive insurance is optional, but if you live in a hail prone area, the insurance industry recommends this coverage.

What to Do After a Hailstorm

First, if a Hailstorm Strikes, don’t go out in the storm to try to protect your property. You could be injured.

Assess the damage.

•Check trees, shrubs and plants around your house. If they are stripped of their foliage, there is a possibility that your roof is damaged. You should also check for roof damage if patio covers, screens or soft aluminum roof vents are dented.

•Check your car for dents and broken or cracked glass.

Protect your property from further damage.

•If you find signs that hail has battered your property, take immediate steps to protect it from further damage.

•Cover any broken windows and holes in your roof so that no water can enter and damage your home’s interior.

•Cover any broken glass in your car to prevent damage to the interior from rain and remove glass from the car’s interior to prevent cuts in upholstery and carpet.

File your claim

•Call your agent or company as soon as you notice damage. Practically all homeowners policies cover hail damage. You car will be covered if you’ve purchased comprehensive coverage.

•If your agent or company requests you to do so, follow up your call with a written explanation of what happened.

•Save receipts for what you spend and submit them to your insurance company for reimbursement.

Select a repair company.

•After an insurance adjuster has surveyed the hail damage to your property, select a reputable roofing company or auto body shop to make repairs.

•Allow only the insurance adjuster and roofer you have selected to get up on your roof. Each time someone walks on it, more damage can occur.

•Be wary of out-of-town roofers who move into an area and set up shop following a storm. While most of these firms are reputable, some have collected money from homeowners and moved on to the next storm site without paying suppliers or leaving work unfinished. This can leave homeowners holding the bag for those additional costs. It’s a good idea to select a company with established credibility and local references. Word of mouth is still your best guide.

•Be sure roofers have workers compensation and liability insurance. If they don’t, you may be held liable if one of the workers is injured or if they damage a neighbor’s property.

•Don’t make final payment to the roofing company until your roof has been inspected and you are satisfied.

Use hail resistive roofing materials.

•When building a new home or replacing your roof consider using hail-resistive roofing products. The insurance industry has an Underwriters Laboratory standard ranking, the UL 2218 standard. The standard has four impact-level designations that will help you compare products. Roof coverings that show the most resistance earn a Class 4 rating; the least, a Class 1 rating.

•Impact-resistant Roofs: Smart Steps to Reduce Hailstorm Damage is a free, online learning experience that consists of four self-paced learning modules. It teaches homeowners and other consumers about the benefits of installing impact-resistant residential roofing products.