Your stuff isn’t protected by your landlord’s policy, so make sure you have the coverage you need.
(By Cameron Huddleston, Contributing Editor, Kiplinger.com) Just because you’re renting your apartment or home doesn’t mean you’re off the hook when it comes to insurance. Your landlord’s property insurance policy will cover the building if disaster strikes, but it won’t cover your belongings. That’s why you need renters insurance. This affordable insurance — a policy costs less than $200 a year, on average — covers renters against losses from fire or smoke, lightning, vandalism, theft, explosion, windstorm and water damage (not including floods), according to the Insurance Information Institute (III). If your home is damaged by a covered event and you have to live somewhere else, most policies will reimburse you the difference between your additional living expenses and normal living expenses. Plus, renters insurance helps cover legal costs if you’re taken to court because someone is injured at your home. If you don’t have a policy — 57% of renters don’t — here’s a checklist from III to help you choose the right coverage: Figure out how much coverage you need for your possessions. Create a home inventory to determine the value of all of your belongings (furniture, electronics, clothing, jewelry, etc.). A replacement-cost policy will pay to replace your possessions (up to the policy’s dollar limit), whereas a cash-value policy will pay only what the items are worth when stolen or damaged. Expect to pay about 10% more for replacement-cost coverage. If you have expensive jewelry, collectibles or art, consider adding a floater to your policy to provide more coverage. Standard policies offer only a limited amount of coverage for these items. You’ll need receipts or appraisals for items to be covered by the floater. Understand the deductible. The deductible is the amount you’ll pay out of pocket before insurance kicks in. The larger the deductible, the lower your premium. So if you can afford a $1,000 deductible, you’ll cut your premium by as much as 25%, according to III. But considering how inexpensive renters insurance is, the savings might not be worth the large amount you’ll have to fork over to pay a high deductible. Know what disasters are covered. Although losses from fires, lightning, windstorms, theft, vandalism, explosions and certain types of water damage are covered, standard policies don’t cover floods or earthquakes. You can get flood insurance through the federal government’s National Flood Insurance Program, and check with your insurer (like Jon Jepsen at SentryWest Insurance) about getting separate earthquake policy. Make sure you get enough liability coverage. Most policies provide at least $100,000 of liability coverage (if someone sues you) and about $1,000 to $5,000 worth of medical payments coverage (which allows someone who gets hurt on your property to submit medical bills to your insurance company). If you need more than $300,000 worth of liability coverage, consider getting an umbrella policy for an additional $150 to $300 a year for $1 million worth of coverage. Be aware of limits on living-expense reimbursements. Although most policies will help renters pay for living expenses if they have to live elsewhere as a result of property damage, insurers will either limit the amount of time they’ll provide coverage or place a cap on the amount that they’ll pay. Ask about discounts. Many insurance companies offer a variety of discounts. For example, you might have to pay less if you have a security system, smoke detectors and deadbolt locks. Insurers also offer discounts to customers who have multiple policies with them, have good credit or are 55 or older. So be sure to ask about ways to lower your premium. You can compare costs by contacting Jon Jepsen at SentryWest Insurance for multiple quotes. If you have a roommate, ask whether the insurer will allow you to purchase a single policy for both of you (then you can split the cost). Read more: http://www.kiplinger.com/columns/kiptips/archives/why-you-need-renters-insurance.html#ixzz1bu47s2Vw This morning my neighbors had an incident with sewer backup in their home and it reminded me of a common situation many of my personal and commerical clients face. What drew my attention was the witty catch-line on the back of the plumber’s vehicle (see photo) – “In our business, a flush beats a full house.” Well, I guess that goes without saying.
While this week’s deluge has caused extensive water damage to some homes and businesses, flooding can also cause sewage from sanitary sewer lines to back up into houses through drain pipes. These backups not only cause damage that is difficult and expensive to repair, but also create health hazards. Most homeowner and business insurance policies do not cover sewer backup unless specific sewer backup coverage is added to the policy. Obtaining an insurance rider or endorsement on a homeowners or business policy would cover such damage if it occurs. Sewer backup coverage is available from most insurers for a nominal cost – usually $35-$80 on an annual insurance policy. But as I review policies for many potential clients, I find they are without this important coverage. In my agency, we include water and sewer backup coverage on all our quotes. Many homeowners and businessowners go with the cheapest quote they recieve not realizing their policies lack important coverage like this. In the end, the property owner ends up paying hefty repair bills to damage caused by the water and sewage that backs up into their homes and businesses. I encourage everyone to check with their trusted insurance advisor to make sure their policies adequately cover them for this icky and unfortunate loss. Yuck! 5,000. That’s the number of earthquakes felt in the United States each year.
Popular belief may consider California to be the state at most risk of an earthquake, but since 1900, earthquakes have caused damage in all 50 states, according to the Insurance Information Institute. In fact, Oklahoma was struck by at least 10 minor earthquakes in a two-day period in late August 2009. These were strong enough to be felt throughout the central part of the state. While Alaska experiences more earthquakes that any other state, California remains the greatest risk for widespread and catastrophic damage to property. A 2006 forecast by experts from the U.S. Geological Survey, the Southern California Earthquake Center, and the State Geological Survey said that the state is virtually certain to be hit by a major earthquake by 2028. Despite numerous warnings, only 12 percent of Californians own earthquake insurance, down from 30 percent in 1996 — when the state was still recovering from the devastating 1994 Northridge earthquake, which at an estimated $20 billion in property damage was the most-costly quake in U.S. history. Homeowners and business owners have limited or no protection provided by their existing insurance coverage for damages resulting from earthquakes. Some damages caused by specific conditions subsequent to the shaking and cracking — such as fire due to broken gas lines or water damage due to burst water pipes — may be covered by home and business insurance policies, according to the Insurance Information Institute. However, property owners should be aware that property insurance does not cover the damage or destruction of buildings or personal property caused by the shaking and cracking of an earthquake. It is specialized earthquake insurance that provides financial protection for property owners at risk of earthquake damage, explains the Insurance Information Institute. Who should buy earthquake insurance? United Policyholders, a non-profit organization focused on educating the public on insurance issues and consumer rights, draws the following conclusion: “If you live in [earthquake] country, have equity in your home and couldn’t afford to rebuild it on your own, buying earthquake insurance makes financial sense. It really is that simple.” The organization also warns that government and charities may not be able or willing to provide rebuilding resources after an earthquake disaster. Earthquake insurance policies are provided by a small number of private insurance carriers. In California, the California Earthquake Authority, a privately funded, publicly managed organization, provides homeowners with earthquake insurance. For earthquake insurance, it’s important to consider having enough coverage to repair or rebuild a home in light of building code improvements put in effect after the house was built. Plus, consumers will need funds for living expenses while the earthquake-damaged house is repaired. Earthquake insurance is an important issue, especially for those in California and the West Coast. To discuss, please contact Jon Jepsen. Courtesy: Trusted Choice |
AuthorJonny Jepsen, CIC Categories
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