Steve Naught's Insurance Tips & Premium Advice

Know Your Limits - Business Liability

2012-10-06T05:45:00.000-07:00

The objective of the Commercial General Liability policy is to provide coverage in the event of a lawsuit when bodily injury or property damage occurs due to your business operations. The limits on your policy have separate functions to protect your assets in several ways.

The Each Occurrence Limit is the most that the policy will pay out for any one occurrence on the policy. If you have a $500,000 limit and a $600,000 loss takes place, your policy will only respond to the first $500,000 and you will be responsible for the remaining $100,000 in damages.

The General Aggregate Limit is the most the policy will pay out for all losses in a single policy period. For instance, your policy has a $1,000,000 aggregate and you have multiple claims totaling $1,000,000. The policy will act in response to the $1,000,000 aggregate limit and then stop.

The Products and Completed Operations Aggregate reacts to all losses due to a completed operation or product claim up to the policy limit. This limit comes into play when a service has been completed and that service later results in a loss. An auto repair shop does a tune-up on a vehicle and the mechanic does not correctly replace the oil plug when he is done. Only after the vehicle is released into the owners possession does the loss occur, yet it is still the shop’s responsibility for the loss. This would be covered under the completed operation limit.

The Personal and Advertising Injury Limit is each occurrence based on a personal or advertising injury offence. This limit covers you for injuries such as libel and slander to another party. If your competitor loses business due to statements you make about their operation, they may have legal recourse against you. This type claim would be subject to the Personal and Advertising Injury limit.

The Medical Expense Limit is on the policy to pay for bodily injury claims regardless of fault. If a person is injured on your premises, the policy will likely pay for the injuries up to the medical expense limit. This limit is used as a good-will gesture to dissuade larger liability suits from materializing.

Be sure to check your general liability limits and ask your agent for optional quotes on higher amounts if needed.

I am a Certified Insurance Counselor in Osage Beach MO. Follow me on Facebook or if you have questions you can reach me by email.

Insuring Your Lake Home

2011-01-08T06:15:00.000-08:00

Your Largest Tangible Asset

In many cases our homes are the largest asset we have. It is very important that we not only take care of that asset, but also protect ourselves if there were a loss. Often a bank will require the home be covered for the cost to replace the structure; however there are many other issues that should be addressed to adequately cover your home in the event of a loss. Every insurance policy has exclusions and endorsements that can alter coverage so it is best to talk to your agent about your specific circumstance.

Homeowner Policy Coverage

The homeowners policy covers five main areas; Dwelling, Personal Property, Other Structures, Loss of Use and Liability. Dwelling coverage offers protection to the structure and fixtures as the result of damage due to a covered cause of loss such as fire or wind damage. In covering the home correctly your agent will likely prepare a replacement cost estimator to make sure the structure is insured adequately. You do not want to under insure or over insure your home and need to be aware that the replacement cost is not necessarily the same as the market value you paid for the home. The insurance company will not insure the land the home sits on or the beautiful view that increased the purchase price.

Personal property covers the contents in your home such as furniture, clothing, wall hangings, televisions, or computers. Most companies will include a certain percentage of the dwelling value for the contents limit. It is a good idea to make sure the amount they automatically provide is enough to cover your needs. You can use a home inventory checklist provided by your agent in order to get a good estimate of your personal property values. Videotaping the inside of your house and its contents and keeping a copy of the tape and checklist at another location is also worthwhile. These items will be very helpful in speeding up the claims process with the adjuster in the unfortunate event of a loss.

The other structures limit on the homeowners policy is also typically a percentage of the home value. This includes coverage for detached structures such as outbuildings, detached garages, swimming pools and docks. If this amount is inadequate and needs to be increased, your agent can endorse the extra coverage onto the policy for an additional charge.

Loss of Use coverage is available in the event you are forced from your residence due to a covered loss. This gives coverage for additional expenses you must take on above your normal expenses due to the loss and would include renting a place to stay.

Your homeowners policy should include coverage for Liability in the event you are brought into a lawsuit for damages you may cause to others. This would include bodily injury or property damage to others and pay for litigation expenses and court decisions up to the limit on the policy.

Lake Home Topics

Often times the things that attract you to a home can add additional cost or make coverage more difficult to obtain. There are several issues facing homeowners when they are purchasing insurance here at the Lake of the Ozarks.

Most companies will insure your dock as part of your other structures limit. The problem is that many of them will exclude coverage to a detached structure for collapse. This is a major issue when we have a snowstorm that puts several inches of snow on your covered dock. Some companies will include the collapse coverage automatically while others can add this by endorsement for an additional fee. Don’t wait until you have a loss to find out if your dock is covered correctly; ask your agent today.

There are other issues that concern dock owners. Wave action and wear and tear are not typically covered under your policy, so it is a good idea to take preventative measures in protecting and maintaining your dock. Also, many docks have diving boards, slides and other amusement devices on them or nearby in the water. Each company has a set of underwriting guidelines that these toys may or may not meet. This does not necessarily mean that they will deny coverage in the event of a claim; however after a loss or upon inspection the company may recommend you remove the exposure, otherwise they may cancel the policy.

Home Rental Issues

If you rent your home out to others on either a short term or long term basis, you are increasing your chances of having a property or liability claims. If you are renting out your home you may be better suited to be covered under a commercial insurance policy verses a standard homeowners policy.

Points for Condo Owners to Consider

Condo owners have several areas of concern to address. Even though the condominium association has a master policy, you may still be responsible for a certain portion of the building coverage. For example, the condo by-laws may advise that you are responsible for everything “studs-in” inside your unit. If this is the case, you will need to cover your portion of the building and improvements and betterments to your unit under your policy.

Many unit owners have a boat slip in the association’s community dock. If there is a loss and your lift is damaged, coverage will likely need to come from your insurance policy and not the master policy. Some companies will include the hoist to your policy’s building limit while others may include this in your contents limit. Verify you have the right amount of coverage in both of these areas with your agent.

Assessment coverage is another issue for condo owners to consider. This will reimburse you for special assessments passed on to you from the association. This coverage is only available when the cause of loss is covered under the association’s master policy.

Protecting Your Home While You Are Away

While you are away on vacation or merely at work there are a few home protection tips you should consider:

·Change your locks when you move into a new home.

·Turn down the ringer on your phone while you are out.

·Set automatic timers on lights for different times in different rooms.

·Set a timer to a talk radio station so voices can be heard in the home.

·Put a hold on your newspaper and mail when you go on vacation.

·Install outdoor motion sensor lighting.

·Keep trees and shrubs around windows well groomed.

·Alert friends and neighbors when you will be away.

Top Ways to Save on Premium

·Consider increasing your deductible.

·Install smoke detectors and fire extinguishers.

·Ask about a Paid-In-Full Discount.

·Monitor your credit rating.

·Inquire about multi policy discounts.

·Find out if your homeowners association has a group discount program.

Your Agent is the Key.

The most important way to protect your home is to have an open line of communication with your insurance agent. The more they know about your specific situation, the better they will be able to assess your needs and make sure you have the best protection in the event you have a loss. Isn't that why you buy insurance?

I am a Certified Insurance Counselor in Osage Beach MO. Follow me on Facebook or if you have questions you can reach me by email.

Steve

How Do You Choose Your Insurance Agent?

2010-12-07T19:41:00.000-08:00

In this advertising age of talking lizards, sarcastic Neanderthals and funny fowls you may believe that anyone can sell you insurance and you’d be mostly right. Many people view insurance as a commodity and feel that it is all the same with no differences other than the price. The truth is that insurance is vast and complex. If you’ve ever tried reading any one of your policies you’d know what I mean. Many policies give coverage to you, take it away in an exclusion and then may turn around and endorse the coverage back on elsewhere in the policy.

As a society we look to CPAs, attorneys, and financial counselors as our trusted advisors and pay top dollar for their services while giving the insurance bid to the lowest priced agent. From an insurance standpoint each person has a unique situation that requires special treatment. A catchy jingle, humorous advertisement or celebrity endorsement is not going to guarantee that a claim is paid.

The best way to make sure that a future claim will be handled correctly is to have a good ongoing relationship with your insurance agent. Your agent should have an understanding of your daily operations and the risks that are involved in running that operation. The agent should also be familiar with insurance. He or she may not need to be a walking encyclopedia of insurance information, but should be able to look at your policy and point out where you may have coverage issues. Having the correct limits and values on your policy is only the first step in the insurance equation. What good are those limits if the coverage is unavailable at the time of loss due to exclusion or other limitation in the policy?

Treat your agent as you would any other trusted advisor. Sit down and go over your coverage, ask questions, and let them know the entire picture. Also, consider narrowing down the number of agents you are using. How may CPAs do you have? How may attorneys? Why should you have multiple agents covering your needs while each of them only knows part of the story on how to best protect you, your family and your business?

If your main insurance concern is price, just remember, that sometimes you get what you pay for. Don’t get burned over a few dollars. Hire a professional to service your insurance needs.

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Post your insurance questions. I am happy to help if I can.

Steve

Insurance Tips for Business Owners

2010-11-20T12:16:00.000-08:00

As a business owner your primary responsibility is to make sure the business turns a profit. You may be inclined to let a subordinate handle your insurance purchase, but ultimately you are the one responsible for how to cover your business. Here are a few practical things that you should keep in mind when it comes to your insurance policies.

#1) Don’t turn in small property claims. You’re asking the question, "Then why do I pay for insurance?" The Answer: You are paying to take care of those mishaps that would be a financial burden to handle on your own. Consider raising your deductible which keeps your claims frequency down and help lower your premiums. A lower claim frequency may allow your agent additional options when looking at other insurance carriers.

#2) Know your liability limits. Do you have enough to cover a large loss? Look at your policy and ask your agent for a quote on higher limits or an umbrella policy. You will be surprised at how little the cost is for some extra peace of mind.

#3) Insure your property to value. Even with replacement cost coverage the company will likely only pay the limit on the policy. In the case of a partial loss you could be assessed a penalty if you are not insured to value. For example, a business has a $100,000 building and only wants to cover the building for the bank loan of $50,000. A fire destroys half of the structure. Which half burned down, your half or the companies’ half? You can see the dilemma.

#4) Pay your bills in a timely manner. Although many companies have a grace period you should always have your payments in on time. The company is not required to reinstate your policy which may cause a lapse in coverage and a claim might not get paid. This also may make it more difficult for your agent to obtain replacement coverage.

The best advice is to always communicate with your agent and have a working knowledge of your coverages.

Steven Naught, is a Certified Insurance Counselor with the Naught-Naught Insurance Agency. He can be reached at 573-348-2794 by email at stnaught@naught-naught.com or online at http://www.stevenaught.com.