It's your home and you want to protect it with the right homeowner's insurance policy. To do this it's important to understand what a standard homeowner's insurance policy includes. There are four key components consisting of:
Coverage for the structure of your home.
Coverage for your personal belongings.
Living expenses in case you are temporarily unable to live in your home due to a fire or other insured disaster.
1. Your House
This part of your policy generally pays to repair or rebuild your home if it is damaged or destroyed by fire, hurricane, hail, lightning or other disaster listed in your policy. It generally does not pay for damage caused by a flood, earthquake or just wear and tear. When purchasing coverage for the structure of your home, make sure to buy enough to rebuild your home. Also, review this coverage on an annual basis to make sure you have sufficient coverage.
2. Your Personal Belongings
Your furniture, clothes and other personal belongings are usually covered if they are stolen or destroyed by fire, hurricane or other insured disaster. Most companies provide coverage between 50% to 70% (this is just an average, every policy is different) of the amount of insurance you have on the structure of your home. The best way to determine if this is sufficient is to conduct a home inventory, in case you need to increase your coverage. If you have questions about what is covered by a specific policy, contact us.
This part of your policy may also include off-premises coverage, which means that your belongings are covered anywhere in the world, unless you have decided against this coverage.
Expensive items such as jewelry, furs and silverware are covered, but there are usually dollar limits if they are stolen. To insure these special items to their full value, consider purchasing a special personal property endorsement or floater and insure these items for their appraised value.
Trees, plants and shrubs are also covered under standard homeowners insurance. They are protected against theft, fire, lightning, explosion, vandalism, riot and even falling aircraft. They are not covered against damage by wind or disease.
3. Liability Protection
Liability protects you against lawsuits for bodily injury or property damage that you or family members cause to someone else. It also pays for damage caused by your pets. So, if your child or dog accidentally breaks something in your neighbor's yard, you are covered. The liability portion of your policy also pays for both the cost of defending you in court and any court awards—up to the limit of your policy.
Liability limits generally start at about $100,000. Many recommend that you have up to $300,000 in coverage. Some people feel more comfortable with more coverage. You can also purchase an umbrella or excess liability policy which provides broader coverage, including claims against you for libel and slander, as well as higher liability limits.
Your policy also provides no-fault medical coverage. If a friend or neighbor breaks an ankle playing basketball in your back yard, he or she can simply submit medical bills to your insurance company. Expenses are paid without a liability claim being filed against you. You can generally get $1,000 to $5,000 worth of this coverage.
4. Additional Living Expenses
If your home is damaged because of a fire, storm or other insured disaster and you can't live in it, this coverage pays the costs of living someplace else while your home is repaired or you find another place to live. While your home is being rebuilt, hotel bills, restaurant meals and other living expenses are covered. Coverage for additional living expenses differs from company to company.
Footnote: This is a brief overview of the coverage that can be included in a Homeowner's Insurance policy. You should read a policy thoroughly before purchasing any insurance policy.
Navigating Life Insurance
Term Life Insurance
Term Life insurance is life insurance that you pay for during a specified length of time or term – generally one to 30 years. You select the amount of the death benefit or face amount to meet your needs.
Premiums, or payments, which can be the same amount or increase with time, must be made monthly, quarterly, semi-annually, or annually. If you die during the term of coverage, the face amount of your policy will be paid to your beneficiaries. Term insurance policies do not accumulate cash value and therefore usually offer lower premiums than other life insurance products with the same face value.
Universal Life Insurance
Universal Life is permanent insurance that has the potential to accumulate cash value. However, it offers additional features and options. For example, you can increase or decrease your policy's face amount to accommodate your changing protection needs. You can also increase or decrease the dollar amount of your premium payments and make additional lump sum payments to your policy. Since a Universal Life policy accrues cash value, you can borrow against this cash value for any purpose.
You have the option to skip premium payments if your account has accrued sufficient value because the premiums will be taken from the accrued value. A Universal Life policy also has the potential to earn a higher rate of return than a whole life policy, although there is a risk that your rate of return could drop.
Whole Life Insurance
Whole Life Insurance is life insurance that you own for your entire lifetime. The amount of the death benefit or face amount can be selected to meet your needs.
Premiums, or payments, are fixed and can be paid monthly, quarterly, semi-annually, or annually. As more premiums are paid, your policy accumulates a cash value that grows on a tax deferred basis. In essence, whole life is like buying a house versus renting it. The monthly cost is higher than it would be for a term life policy, but with each payment you make you gain equity. You can borrow against a Whole Life policy for any purpose. Loans, however, require you to pay interest and any borrowed amount you do not pay back is deducted from the payout to your beneficiary at the time of your death.
Final Expense Insurance
Your family means the world to you. The last thing you want is to leave them with major expenses after you’re gone. Final Expense insurance is life insurance that helps provide the money they may need to pay medical bills, funeral expenses, legal fees or unpaid bills. It is an insurance policy that lets you decide how your assets are distributed. By planning ahead, you can help protect your loved ones from unnecessary financial stress when you die. And, you can distribute your assets in the manner you decide!
Small Business Insurance Basics
No matter what the size is of your business you will need some level of insurance to protect you and your business. For small businesses, insurers often combine a number of insurance policies into a package sold as a single contract. The most common policy for small businesses is the Business Owners Policy (BOP).
Most small businesses need to purchase at least the following four types of insurance.
Property insurance compensates a business if the property used in the business is lost or damaged due to such things as fire or theft. In addition to the building or structure, property insurance covers personal property such as office furnishings, inventory, raw materials, machinery, computers and other items necessary to a business’s operations. Depending on the policy, property insurance may include coverage for equipment breakdown, removal of debris after a fire or other destructive event, some types of water damage and other losses. It may also provide operating funds when the business is trying to get back on track after a catastrophic loss.
Any business can be sued. Customers may claim the business caused them harm due to a defective part, an error in a service or disregard for another person’s property. If the business is found liable, liability insurance pays damages, up to the policy limits, as well as attorneys’ fees and other legal defense expenses. It also pays the medical bills of anyone injured by or on the premises of the business.
Business Auto Insurance
A business vehicle policy covers cars owned by a business. The insurance pays any costs to third parties for bodily injury or property damage for which the business is legally liable, up to the policy limits.
Workers Compensation Insurance
In all states but Texas an employer must have workers compensation insurance when there are more than a certain number of employees. The minimum number varies from three to five, depending on the state. Workers Comp insurance, as this coverage is usually called, pays for medical care and replaces a portion of lost wages if an employee is injured in the course of employment, regardless of who was at fault for the injury.
If a worker dies because of injuries sustained while working, the insurance provides compensation to the employee’s family. An extremely small business, with one or two people working out of a home, may not need workers compensation insurance. But, it may need more property and liability insurance than what is offered by a typical homeowners policy.
Other Types Of Business Coverages
Errors and Omissions Insurance/Professional Liability
Some businesses involve services such as consulting, design functions or representing the needs of others, which can lead to being sued by customers or clients, claiming that the business’s failure to perform a job properly has injured them or caused some sort of harm. Errors and omissions or professional liability insurance covers these situations. The policy pays the judgment for which the insured is legally liable, up to the policy limit. It also provides legal defense costs, even when there has been no wrongdoing.
Employment Practices Liability Insurance
Employment practices liability insurance covers (up to the policy limits) damages for which an employer is legally liable such as violating an employee’s civil or other legal rights. In addition to paying a judgment for which the insured is liable, it also provides legal defense costs, which can be substantial even when there has been no wrongdoing.
Key Employee Insurance
When certain key employees die or become disabled, income insurance can compensate the business. This coverage cushions some of the adverse financial consequences that results from losing a key employee.
As the name implies, an umbrella liability policy provides coverage beyond the business’s other liability insurance policies. It is designed to protect against unusually high losses and provides protection when the policy limits of one of the underlying policies have been used to the limit. For a typical business, the umbrella policy protects beyond the general liability and auto liability policies. Additionally, if a company has employment practices liability insurance or other types of liability insurance, the umbrella could provide protection beyond the limits of these policies.
What Is Condo Insurance And Why You Should Have It
Do you live in a condo? If so, keep in mind that your condo association coverage will only cover the exterior of the condominium. When it comes to your home, condo insurance will cover your unit, protecting you and your home, everything that the condo association’s master policy doesn’t cover.
What does condo insurance cover?
Condo insurance provides coverage for the inside of your condominium. Depending upon the specifics of your condominium association’s master policy, your condo insurance may include coverage for:
personal property and valuables.
In addition to covering your belongings in the event of a loss, your condo insurance also protects you against liability claims if you are responsible for another person’s injury or property damage, or you have legal fees to pay due to a lawsuit. Condo insurance will protect your from potential losses, such as
theft of or damage from fire,
liability claims and lawsuits if someone is injured in your condo or
you are responsible for damage to someone else's property.
Because liability claims may lead to lawsuits, it is important to evaluate the amount of coverage you need to protect yourself financially. For complete protection, many people purchase umbrella liability policies.
How Much Condo Insurance Should I Have?
One of the first questions condominium owners ask is, “How much condo insurance should I get?” Basically, you can get a rough idea of how much insurance you need by performing an inventory of all your personal items and figuring out how much it would cost to replace your belongings after a burglary or fire. Certain valuable items may need special or additional coverage.
Consider the following:
You have $10,000 worth of jewelry, $20,000 worth of furniture, and another $20,000 worth of electronics, clothing items and other personal items.
Make sure that your total coverage limits are set high enough so that there aren’t any items that exceeds the per-item limit. If you a piece of art worth $5,000, but your per-item limit is $1,000, your insurance is not adequately covering your items.
Once you have this inventory, it will be us determine how much coverage you will need.
To find the most affordable coverage that matches your specific needs, give us a call today to get the right condo insurance policy to protect your condo investment and personal assets.