How to protect yourself and your family with Renters Insurance

What you’ll discover in this report:

• Surprising secrets about what’s covered in a standard Renters Policy!
• The most dangerous myth about renters insurance
• What to do before you ever have a claim
• Protecting your jewelry, art, computer equipment and other valuables that may not be covered!
• Renters Insurance demystified! What are you really getting? Find out here…

Busting the Myths about Renters Insurance

It is one of the most commonly repeated myths about insurance. Renters don’t need insurance because their landlord’s policy provides coverage for the renters’ property.

No, it doesn’t. Further, if someone slips and falls in your apartment or rented home, your landlord’s insurance usually won’t provide any coverage for you if you are sued.

Renters insurance is basically like homeowners coverage without coverage for the structure.

* Note. Renters insurance provides coverage for your possessions and for liability if someone injured while on your premises sues you. Renters insurance also covers any of your possessions when they are away from your residence, including in your car.

In addition, renters policies provide what are called additional living expenses. If some catastrophe covered by the policy — fire, bursting pipes — makes the place you are renting uninhabitable, the policy will pay some of the costs you incur to live somewhere else while the residence is being repaired.

The coverage is usually limited to either a specific period of time, say 12 months, or what the insurance company considers a “reasonable length of time.” Also, there is a cap on the amount of additional living expenses the insurer will pay, usually a percentage of the total liability limits.

Like homeowners insurance, renters policies do not cover damage or losses resulting from flooding, landslide or earthquake — although it is possible to buy coverage for these risks separately.

Actual Cash Value vs. Replacement Cost for renters

Like homeowners insurance, there are two options for covering your possessions:

• Actual cash value, which is the replacement cost of an item minus depreciation.
• Replacement, which allows you to buy a new item to replace the one lost, stolen or damaged, no matter how old that item is.

* Note. Because replacement cost is better coverage, it costs more. Usually about 10% to 15% more.

Speaking of cost, renters insurance is fairly cheap when compared with other personal insurance policies. Usually, you can get a decent policy for about $300 a year, depending on where you live. If you choose higher limits for your personal property and liability coverage, you could pay up to $400 a year.

The policy has dollar limits on certain types of items. For example, there is usually a $1,000 limit for jewelry and anywhere from a $3,000 to $10,000 limit for computer equipment. If you want higher limits, you can purchase an endorsement, or “floater,” to the basic policy.

Like homeowners insurance, renters coverage has a deductible — the amount you will pay before insurance kicks in. The higher the deductible, the less your policy will cost.

You probably should have the same liability limits on your renters policy as you do on your auto insurance policy. Like your auto policy, you want to make sure your renters insurance will cover all your assets if you are sued.

If you are renting with a roommate or roommates, it’s probably best to include all your roommates on the policy. In addition, if you are living and renting with a significant other, many insurance companies will allow you to obtain joint coverage, just as if you were married.

If You Rent: How to Keep Track of What You Own…

* Tip. Like homeowners, you as a renter should have a written and visual inventory of all of your possessions. For items of significant value, you should write down the model numbers, serial numbers, date of purchase and price. Make a written copy of your inventory and keep it at another location, along with your photographs and/or video of the items. A safe deposit box is a good place to keep such records.

* Note. If one of your “possessions” is a dog, you may find it more difficult to get coverage, particularly if that dog is a Rottweiler, Pit Bull or Doberman.

* Tip. Finally, remember that many insurance companies give discounts to those who have multiple policies with a given insurer. Shop around, or have your agent shop around, for insurance companies that have the best rates, discounts, etc., for renters and auto insurance if both are placed with the same company.

How to protect yourself and your family if you own a boat!

What you’ll discover in this report:

• Surprising secrets about what is and what is NOT covered in a standard Homeowner’s Policy for your boat
• Clear up the common confusion about the different kinds of “watercraft” insurance…most owners don’t know this!
• How to save money on boat insurance…
• A special kind of insurance you may need to have…depending on what you do with your boat…
• Insurance jargon demystified! What are you really getting? Find out here…

They are called pleasure boats or pleasure crafts, but, let’s face it, sometimes they’re a “pain.” They are expensive, to say the least — and potential danger comes with the pleasure.

They are, after your house(s) and maybe your car(s), possibly your most valued assets. You can choose to own and operate a boat, yacht or Jet Ski without insurance (although some marinas and yacht clubs won’t let you dock your craft unless you have coverage). However, that’s not a very smart choice.

* Note. If you have a homeowner’s insurance policy you may have some coverage for your watercraft but it is very, very minimal. A typical homeowners policy will pay as much as $1,000 to repair damage to your boat, but — guess what? — that damage has to occur while the boat is at your home. This is not exactly the kind of damage coverage you need. In addition, there may be some liability coverage. Some, but hardly enough.

You could gamble and not buy insurance for your watercraft, but that’s a big gamble. You’re risking not only losing or severely damaging the boat in an accident without compensation, but possibly your other assets if your boat causes damage and/or injuries to other boats and/or boaters.

Lots of Options…How to Choose

First, you need to know that there are three types of “boats.”

• Anything less than 16 feet long is usually called “personal watercraft” by insurers. This includes Jet Skis, Waverunners, Tigersharks, Wet Bikes and Sea Dog “cycle” style models, as well as Jazz and Rage “mini boats.”
• “Boats” are 16 feet to 25 feet, 11 inches.
• Anything at least 26 feet long is classified as a “yacht.”

You will find that insurers have varying appetites for these types of watercraft. For this insurance, smaller is often not better. In fact, personal watercraft tends to be more accident-prone than most kinds of boats and yachts.

Some insurers won’t provide coverage for your personal watercraft at all or will only provide coverage if it is part of a larger policy. Your policy should include coverage for injuries to you and your passengers, the craft itself, liability (for damage and injuries to other crafts and people) and theft.

* Note. If you use your watercraft for water-skiing, you need to get coverage for this exposure as well. (It usually needs to be added to a standard policy.) You can also get coverage for the trailer(s) you use to transport the watercraft.

Insurance for Powerboats, Sailboats

In the insurance world, “boats” are usually smaller powerboats and sailboats. Standard policies for boats cover damage to the craft, usually on what is called an “all-risk” basis. In this case, all-risk includes damage caused by fire, lightning, theft, vandalism and windstorms.

The coverage is usually available for the boat itself, outboard motor(s), the boat’s trailer and personal property on the craft that is part of the normal operation of the vessel. Some insurers offer separate coverage for fishing equipment, cell phones and computers that are aboard the boat.

The standard boat policy also provides liability coverage, which is usually offered in increments of $100,000 to as much as $1 million. Therefore, it is similar to auto insurance liability in terms of what is available.

Many standard policies also cover medical expenses incurred by you, your family and any other passengers on the boat. Some policies also provide coverage for injuries caused by uninsured boaters or by boaters who don’t have enough insurance. If this sounds like uninsured motorist coverage in an auto insurance policy, it basically serves the same purpose.

* Tip. If you’re shopping for boat insurance, it’s wise to consider only those policies that offer this coverage. Discuss this with your agent.

Insurance for Yachts

If your watercraft is 26 feet or longer, you will need to buy yacht insurance, which provides basically the same coverage as boat insurance, but the terms are different. Under a boat policy, coverage for damage to the craft is called “physical damage.”

Under a yacht policy, the term is “hull.” Liability coverage under a yacht policy carries the name “property and indemnity,” which insurance people often abbreviate to P&I. As with boat liability coverage, P&I is available in increments of $100,000. Depending on the size of your craft, you can buy P&I limits from $2 million to as much as $50 million.

* Note. Like boat insurance, you should seek a yacht policy that offers coverage for medical payments (for you and your passengers) and uninsured boaters.

The cost of your boat or yacht policy is based on a variety of factors: horsepower; how fast it moves (it can cost as much as 50% more to insure a speedboat than it does a sailboat of similar size); where it is to be used; age of the craft and experience of the vessel’s operator.

* Tip. Insurers often offer premium discounts of 5% to 20% to those boat/yacht owners who have taken an approved boating safety course. (In some states, such courses are required to operate a boat or yacht.) Premium discounts are available, from some insurers, for newer vessels and protective devices (depth finders, ship-to-shore radios, burglar alarms). You can also save money on the policy by electing to take a higher deductible.

Like boating itself, watercraft insurance is not cheap. As such, it truly pays to shop around. There are a lot of different policies and coverage options available. Some policies might be significantly cheaper than others, but they don’t offer the coverages you need.

* Tip. This is a complex area of insurance with lots of options. Talk to your agent. Let him or her assess the many options out there and find the coverage that best suits your needs and best protects your assets.

It’s What’s NOT Covered That Will Hurt You

Imagine your home is damaged.  You call your insurance agent to report the claim.  And then you hear the worst news possible, “I’m sorry.  That’s not covered by your policy.”  Now, you have a real problem.

The unfortunate truth is no insurance policy covers you for everything that could possibly happen to you or your property.  However, with a little bit of understanding you can make sure you have the protection you want … and make sure your claims get paid by the insurance company.

Beware: It’s Not Always Covered

Just because you have an insurance policy that doesn’t mean your home is covered for everything.  Your home policy doesn’t cover you against every “cause of loss”.  What’s that?  Fire is a cause of loss.  High wind is a cause of loss.  These are also known as “perils” in insurance terminology.

A standard home policy excludes many causes of loss.  That is, it does NOT protect you from certain perils – like earthquake, flood and surface water, termite damage and many more.  That means if your home is damaged by one of these excluded perils your policy will not respond.  You have no insurance against them.

If you want insurance against some of these perils, you can buy it … like earthquake or flood insurance.  However, some excluded perils are not insurable … like insect damage.  Be sure to discuss your policy exclusions with an agent in our office and buy the protection you really need.  Don’t be caught by surprise after the damage is done.  It’s too late to buy insurance then.

Special Limits On Personal Property

As if your home policy wasn’t complicated enough already it includes “special limits” of protection for some of your personal property.  A “special limit” reduces the protection specifically available for certain types of property.

Property subject to a special limit typically includes … property used for business … cash & coin collections … jewelry & furs … guns … silverware … and more.

Additionally, some of these special limits apply only if the property is lost or stolen – making things just a little more confusing.

For example, the standard home policy typically includes only $1,000 of protection for stolen jewelry.  If your $2,500 diamond engagement ring is stolen you’ll get only $1,000 from the insurance company.  Ouch! And, if the stone falls out of the ring and is lost, there may be NO coverage at all!

The bottom line is it’s very important you fully discuss these conditions and special limits with your agent and buy the protection you need.  Otherwise, you could find yourself with a very nasty surprise … an unpaid claim!

Conducting Business At Home

WARNING!  Your home policy has very strict limits and rules about business conducted at home.  The protection offered by your policy is severely limited if your claim arises from business activities.  Your business property has very little coverage.  And in some cases you may have no liability protection at all.

This is not something to take lightly and just assume everything will be fine.  Be sure to discuss your home business activities with a licensed agent in our office to make sure you’re still protected.

Other Exclusions and Options

The standard home policy excludes protection for many things.  But then the insurance company gives you an opportunity to buy some of them back.

Additionally, you have the option of increasing protection where you personally need it.

There are literally dozens of optional coverages available in your home policy.  Here are some of the more common options available to you.

Identity Theft – many home insurers now offer protection for Identity Theft in their home policies.  This will help pay the expenses you incur to restore your identity if it’s stolen.

Water & Sewage Backup – the standard home policy excludes damage caused by a water or sewage system backup.  You can buy this protection if you want it.

Ordinance & Law — pays the increased costs of repairing or rebuilding your home that are a result of changes in local building codes. For example, your home has single paned windows. After a loss, the local building department requires double-paned windows. This endorsement pays for the increased cost required by the new building code.

Packaged Endorsements – often times an insurance company will package the optional coverages people most commonly buy into a single endorsement.  That means for a lower price you can get several optional coverages added to your policy.

There are many more optional coverage and exclusion buy-backs your agent can explain to you.  Take a few moments to understand them and make good decisions about your protection.

What’s New In Health Reform?

Last year it was a political hot potato and no doubt, with an election on the horizon, it’ll grab a few headlines again, but in the meanwhile the controversial health reforms program, under the Affordable Care Act, continues to move forward in 2012.  Although many of the changes don’t take effect until 2014, it’s worth taking stock of current and upcoming changes in your entitlements. These include:

• Young people up to age 26 can now remain on their parents’ health insurance. Some 2.5 million have so far opted to do so.
• En route to closing the “donut hole” prescription coverage gap for Medicare recipients, seniors now qualify for a 50% discount on Part D brand-name drugs when they reach the gap.
• The Independent Payment Advisory Board has been established and, from next year, will be able to intervene if Medicare costs rise too much.
• States are now allowed to offer home-based services to disabled people through Medicaid instead of institutional care in nursing homes.
• From the start of this year, new rules encourage physicians to set up “Accountable Care Organizations” by working together to improve the standards of care and reduce costs.
• From March 1, federal health care programs have to collect racial, ethnic and language data about patients to identify inequality of treatment.
• From October, health records will have to be stored electronically – with new rules in place to make sure they’re secure and confidential.
• Also from October, hospitals will have to publicly report on performance for a range of treatments, and reveal comments from patients.

The official Government site has also launched an easy-to-use action page to help individuals identify which public, private and community programs meet their needs. Check it out at
finder.healthcare.gov.

8 Driver Safety Reminders

Ask the Agent

I love checking out the keywords that people use to find our blog.  This weekend, someone asked, “Will insurance pay off my house if I set it on fire?”  The short answer – no.  The long answer – that’s arson, which is a felony.  And if you try to file a claim on it, it’s also insurance fraud, which is a crime in 48 states.  So while you wouldn’t have a house anymore, you’d still have a roof over your head in the state pennitentary.

Driving Safety Tips

I am often amazed by the reckless driving I see on my way into to the office.  So many accidents could be easily avoided.  We handle the “after” effects in our business every day…

So, I thought I’d send you a quick “reminder” this month.  PLEASE … read through this short list of safety reminders.  It won’t take long, and it could save your life!

We drive so much it becomes sub-conscious.  So, let these safety reminders dwell in your sub-conscious, too…

• Back off.  Odds are, if you can clearly read the bumper stickers on the car in front while moving- you’re too close!

  I wish I had the statistic of how many car accidents are rear-ending collisions.  It’s a lot.  I realize in heavy traffic it’s sometimes impossible to keep a safe distance between you and the car in front.  But try.

  A safe distance is determined by a 2 second gap – that is, when the driver in front of you passes a road marker, you shouldn’t get there for 2 seconds.  That means the faster you’re going, the bigger the gap between you and the driver in front should be.

• Slow down.  I know its cliché, but speed kills.  It really does.  Plus, speeding tickets are expensive.  And if an insurance carrier finds out about it – and they do check – you could get a rate increase, too.

• Put on that seatbelt.  Why fight the odds?  Statistics prove that seatbelts save lives.  Not to mention in most states being caught without your seatbelt on means a hefty fine.  Be safe – put it on!

• Are you too close to the airbag?  Make sure you’re more than 10 inches from the steering wheel.  If you’re too close, an inflating airbag could hurt or kill you.

• Pay attention to road conditions … and slow down!  If you lose control of your vehicle on a wet road, you might blame the road, but the cops and the insurance company won’t.  They’ll blame you!  Remember, you’re responsible for controlling the car you’re driving in ALL conditions.

• Check all around before changing lanes.  Never assume another car isn’t there.  Look.  It only takes a few seconds for a car to move into a dangerous position.

Of course, there are tons of safe driving tips, these are just the top ones…hope this short list sticks in your sub-conscious mind and keeps you safe.

From everyone here at Hejny Insurance Agency, we thank you for your business and may the roads you travel always be safe ones!