Insurance Tips You Can Use

This Month's Tip


Do Not Overlook the Personal Umbrella Policy

One of the most important insurance policies you can buy is the personal umbrella policy, but many people are unaware they need one. This policy provides high limits of liability to protect you against a catastrophic liability loss. For example, a major car accident may injure numerous people or cause head injuries or death that will result in liability far in excess of the limits typically purchased in a personal auto policy. An umbrella policy sits on top of the auto and homeowner’s policies to provide higher limits of protection. In addition to providing higher limits, this policy normally pays for some losses not covered by the underlying policy, such as legitimate allegations concerning libel or slander.

Personal umbrella policies are growing in popularity. In the past, only wealthy individuals and families purchased this coverage. Today, middle-income families also may procure this policy for protection in our society's increasingly litigious climate. As the tendency to sue for damages rises and awards granted by the courts grow, the personal umbrella policy is increasingly seen as an insurance necessity rather than a luxury. It is especially attractive because of its relatively low cost.

In particular, people with certain characteristics or who engage in certain activities have a higher-than-average need for a personal umbrella policy. These situations include the following.

  • Your total assets are greater than your underlying liability limits.
  • You are financially responsible for the actions of a young, inexperienced driver.
  • You live in an exclusive and affluent neighborhood.
  • You have a high-profile career or high income.
  • You frequently host guests on your property.
  • Your residence includes a swimming pool.
  • You own waterfront property, a farm, or a ranch.
  • You own watercraft, aircraft, or off-road vehicles.
  • You own numerous rental properties.
  • You engage in extensive international travel for pleasure.

Indeed, one could even argue that a lower-income person needs an umbrella policy. Consider an apartment dweller who inadvertently starts a fire while smoking in bed, and the fire damages adjoining apartments. The smoker's liability exposure could be enormous in such a situation. So, once again, a personal umbrella policy is a wise purchase for people in nearly all income groups.

Copyright 2018
International Risk Management Institute, Inc.

Is Your Home Perilously Underinsured?

Is the amount of property insurance on your home correct? What is the appropriate amount of coverage for your home? To begin with, it should be insured for at least 80 percent of its replacement cost when covered under a standard homeowner’s policy. Otherwise, there will be a coinsurance penalty for even small losses. Replacement cost refers to the amount necessary to repair or replace damaged building parts with items of like kind and quality. Some insurance companies even require 90 percent or higher figures when the guaranteed replacement cost option is offered. With this option, the policy pays the full cost of replacing your home (even beyond its limit of insurance if the limit is inadequate) without any depreciation and often without a maximum reconstruction payment. This gives you added protection if there is a sudden jump in construction costs due to a major shortage of certain building materials. Construction costs often "surge" following large catastrophes such as wildfires or hurricanes. Note that guaranteed replacement cost coverage approaches can vary by state and are not even available in every jurisdiction.

Often, homes are underinsured. For example, some homes insured for long periods of time with one insurance company may have inadequate limits of insurance due to increased building costs. In many cases, homes have been remodeled and improved, and this information has not been conveyed to the insurance agent or company, resulting in severe underinsured home values. If your home is underinsured, you not only have inadequate protection for total losses, but you may also lack full protection for smaller losses.

Sometimes homes are mistakenly insured for their market value. However, market value usually is not indicative of the home's replacement cost. For example, market value also reflects the cost of the foundation and the non-destructible land value, both of which may survive intact if the house burns to the ground and must be rebuilt.

In addition, some homes may be insured improperly to meet mortgage company requirements. Some mortgage companies require that the amount of insurance be at least equal to the mortgage balance on the house. The mortgage balance is also not reflective of the home's replacement cost, which is often considerably more but can also be less. Insurance companies and agents often struggle in properly educating mortgage companies about these distinctions, but there is nothing to prevent you from insuring to actual replacement cost if that is indeed greater than the mortgage balance. The problem occurs when the mortgage balance is greater than the replacement cost, which will result in the purchase of a higher limit than needed.

The bottom line is that you should work with your insurance agent to determine the correct replacement cost and resulting insurance limit for your home. Most agents use sophisticated replacement cost-estimating packages that can accurately determine the replacement cost value of your home. Factors that these programs use to determine this figure include the following.

  • Square footage of the home, including its configuration
  • Construction costs for your community
  • Exterior wall construction type, including frame, stucco, brick, or brick veneer
  • Style of home
  • Number of bathrooms and bedrooms
  • Roof type
  • The type of built-in appliances and their replacement cost
  • Attached garages, fireplaces, built-in cabinets, and other special features, such as hardwood floors

The more advanced replacement cost-estimating programs require detailed information to improve the valuation estimate. For example, a rectangular-shaped home with 1,800 square feet will have a much lower replacement cost than a similar-sized home with an "L" shape. In other words, the better cost-estimating programs require information about the number of corners in the home. The more detailed information your agent asks about your home, the more confidence you can place in his or her recommended limit of insurance.

As a final note, you should be aware that it is ultimately your responsibility to adequately insure your home to its replacement cost value. To assist in this endeavor, be sure to request an annual review of your homeowners policy to keep up with increasing building supply and labor costs. Also, ask your agent about the advisability of adding an "inflation guard" endorsement to your policy or about the availability of guaranteed replacement cost or extended replacement cost coverage to help assure that your home is adequately protected.

Copyright 2018
International Risk Management Institute, Inc.

Smother Wildfire Loss Exposures

"And each separate dying ember wrought its ghost upon the floor."

~Edgar Allan Poe, "The Raven"

The 2017 California wildfire season was the most destructive one on record, with a total of over 9,000 fires burning over 1.3 million acres, according to the California Department of Forestry and Fire Protection. The Thomas Fire in Ventura County alone forced over 212,000 people to evacuate and is the largest wildfire in California recorded history. AccuWeather predicts that the total economic toll of these California wildfires may reach a daunting $180 billion.

The good news is that there are certain preventive steps a home owner can take in the face of this dreadful loss exposure. If you live in a wildfire-prone area, the following are some tips for you to mitigate the risk of suffering a wildfire loss.


  • Make sure firefighters can identify and access your home, starting with a visible address from the street. Remember that emergency vehicles are large, tall, and wide. Verify that your driveway is at least 12 feet wide and clear of low-hanging branches.
  • Ensure that recreational fires are made in a fire-safe pit or container and completely extinguished before leaving. Avoid lighting fires when high temperatures, high winds, and low humidity are present. Instead, consider composting.
  • Consider noncombustible or fire-resistant roofing materials, such as Class A asphalt shingles, metal, cement, and concrete products, as well as terra-cotta tiles, if you are building a house or planning to replace a roof. These types of roofs are less susceptible to burning embers from a wildfire.
  • Remove any dead branches, leaves, and any other vegetation from your roof and gutters.
  • Remove any dry brush from your yard, and stack firewood at least 20 or 25 feet from your home.
  • Create a "fuel-break"—driveways, gravel walkways, or lawns.
  • Prevent sparks from entering your home by covering vents with wire mesh no larger than 1/8 inch. Cover skylights and chimney outlets with nonflammable screening materials.
  • Use tempered glass in your windows since this material withstands high temperatures from wildfires better than regular plate or double pane glass.
  • Make trellises of nonflammable metal.
  • Avoid certain exterior siding materials, such as vinyl, which soften and melt easily under high temperatures. Instead, select siding materials such as stucco or masonry, since these resist heat better.

Copyright 2018

Sidestep Flooded Autos

A Key Sign That You Have Bought a Lemon of a Car: You Can Only Go to Restaurants That Offer Valet Pushing

Various parts of the United States, including Texas and Florida, have suffered severe flooding this fall. Carfax estimates that as many as half of flood-damaged cars get cleaned up and moved around the country with no notation of flood damage. As a result, they can end up in the hands of unsuspecting consumers. Flooded automobiles are notoriously unreliable vehicles, and proactive steps should be taken to avoid purchasing one. Here are some tips for you to consider that will help you avoid unknowingly purchasing a flooded vehicle.


Perform a careful examination of the used vehicle. For example, look for a well-defined line or watermark on the inside and outside of the car. Inspect the vehicle in difficult-to-clean areas, like the gaps between panels in the truck or SUV, under the hood, and under the trunk liner, where water-borne materials and debris may still cling. 

Be wary of used cars with new or mismatched upholstery. Nonoriginal or mismatched headliners or trunk liners can also be hidden clues. 

Avoid purchasing cars through auctions because flooded vehicles are often cleaned and then sold at these events. 

Bypass individuals who buy and sell cars as a sideline business. It is better to buy from a reputable dealer or an individual that has owned and actually driven the vehicle for an extended period of time.

Review the auto title closely. Some jurisdictions require that totaled or flooded vehicles be designated as "flood damaged" on the title.

Consider ordering an online Carfax report, which provides unlimited vehicle history reports for $40.

Before you buy the vehicle, be sure to have a trusted mechanic inspect it. Trained professionals know what to look for when it comes to previous flood damage on autos. They can also spot vehicles that were previously involved in major collisions.


Copyright 2017
International Risk Management Institute, Inc.

Top 10 Tips for Filing Property Claims

The insurance industry is built on responding to disasters and assisting people in recovering from them when they do occur. The recent hurricane losses in Texas, Florida, other southeastern states, and many Caribbean Islands serve as a stark reminder of the need for home owners and auto owners to file and subsequently to get their claims handled in the most effective way possible. The following are our top 10 tips for filing and handling property claims.

  1. File your claim promptly. If you have—or suspect that you have—property damage to your home or automobiles, notify your insurance agent as soon as possible with whatever details you can provide (even if you cannot access all your damaged property). In most cases, your agent will have a toll-free phone number for you to contact your insurance company directly. Make sure the adjuster understands that this call serves as notice of your claim. A follow-up e-mail confirming such notice is also in order. In some cases, a claim can be filed online. Keep copies of e-mail exchanges and make notes of any phone calls—who, where, when, what was discussed, and phone numbers.
  2. Perform temporary repairs if possible. Keeping in mind safety and health considerations, try to perform (or have hired) temporary repairs to your home such as boarding windows and covering roofs. If the house is uninhabitable, make sure the electricity, gas, and water are turned off. Note that temporary repairs are reimbursable as part of your insurance claim.
  3. Keep a claim log. Develop and maintain a written log of whom you talked to, his or her title, his/her phone number, the date, action items, and the gist of the discussion. This log is important if you later face problems or delays and need to substantiate your side of the story.
  4. Take pictures. Take as many photos and videos as you can to build up your inventory list. Include the brand, model, and serial numbers in the photos when possible. Any documentation regarding the date of purchase and approximate value should also be included in your itemized list. These records will also be helpful for review later when filing taxes and deducting casualty losses that are not reimbursed by your insurance company or are not covered by insurance.
  5. Don't forget your additional living expenses. If you have a windstorm loss, the standard homeowners policy provides additional living expenses, which are often 20 to 30 percent of your dwelling limit. Your insurance company may advance you money to pay for reasonable additional living expenses. Keep track of these expenses, including hotel rooms, extra transportation costs, clothing, personal toiletry items, and restaurant charges. In the event of a major disaster, note that the Federal Emergency Management Agency (FEMA) offers "critical needs assistance." This aid is a one-time $500 payment per eligible household for those with unmet critical and financial needs. Details are available on FEMA's Critical Needs Assistance program website.
  6. Check first before discarding property. Don't assume that you can immediately discard damaged items. You often need to show them to your adjuster. If your city requires you to remove them for safety purposes, take photographs of the items beforehand. Take two or three photos showing all sides and capturing any serial or model number affixed to the items plus the extent of the damage.
  7. Sign up for text alerts. Many insurance companies offer text alerts to keep you appraised on the status of your claim. Typically, insureds get messages when the claim is first reported, when the estimate is available, and when payments are made.
  8. Be prepared to negotiate. In some cases, your repair or replacement estimate may exceed your claim settlement offer. Don't automatically accept the first offer you receive from the adjuster. It may be wise to ask your contractor and adjuster to talk about the repair costs to come up with a solution. The same process applies to working with your auto body shop and auto adjuster concerning damage to your vehicle.
  9. Explore options if dissatisfaction arises. First, make sure you are providing all the information and documents your insurance company requests in a timely manner. Also, keep your claim log handy when calling to document the results of the call. If you have problems or unreasonable delays, ask to speak to a supervisor or manager. Another option to consider, prior to hiring an attorney, is contacting the appropriate state department of insurance (DOI) to file a formal complaint (this is free and often helpful). See the insurance complaint sections of your state DOI website for details. In many cases, you can file the complaint online.
  10. Find a reputable contractor. Consider the following tips when hiring contractors.

·         Be wary of contractors who solicit business door-to-door or via cold calls. In addition, contractors should be avoided if they quote a price that will automatically go up the next day or week if the property owner does not accept it immediately.

·         Avoid contractors who promise to handle all of the insurance issues for you and ask you to assign the insurance benefits directly to them.

·         Request recommendations from friends, family members, and business associates for reputable contractors who have performed excellent work for them.

·         Ask the contractor for a written estimate that includes any oral agreements he or she makes in this process. The estimate should contain a line-by-line breakdown of costs, including materials and labor. In addition, there should not be a charge for an estimate. Avoid dealing with contractors who attempt to charge for estimates.

·         Obtain at least three estimates along with the names and phone numbers of two former customers of the contractor. The property owner should contact these customers and ask about the work performed.

·         Verify that the contractor is licensed, bonded, and properly insured. Obtain certificates of insurance for workers compensation and general liability policies from the contractor.

·         Contact the Better Business Bureau (BBB) to see if complaints have been filed against the contractor. This step can be performed via the BBB's website.

·         Avoid contractors who ask for payment for the entire job before the work begins. The standard practice is to pay 25–33 percent of the job up front. After the initial payment, only pay for work after it is completed. The final payment should not be made until you are satisfied with all of the work performed.

·         For major work, get an experienced attorney to review the construction contract.


Copyright 2017
International Risk Management Institute, Inc.


Protect Your Identity

Identity theft is one of the fastest growing crimes in America. It happens when a criminal wrongfully obtains and uses the personal information belonging to someone else. Such personal information may include your Social Security number (SSN), credit card numbers, or the personal identification number (PIN) code for your bank account at the automated teller machine (ATM). Although you may think that you are careful with this information, identity thieves are clever and can obtain this information in any number of ways.

So, following are some tips for you to reduce your chances of becoming victims to this insidious crime


- Avoid carrying a Social Security card—or anything bearing an SSN—in a wallet or purse unless specifically needed.


- Never give out an SSN, credit card number, or other personal information over the phone unless there is an established, trusted business relationship with the organization and you called them.


- Do not list an SSN, driver's license number, or home phone number on checks.


- Check Social Security Earnings Statements each year for signs of fraud via www.ssa.gov.


- Invest in a high-quality crosscut shredder, and use it.


- Shred everything that has a name, address, or any type of account information on it.


- Do not use the last four digits of an SSN, date of birth, middle name, child's name, pet's name, mother's maiden name, or anything else easily discovered or guessed.


- Discourage banks from using the last four digits of an SSN as a default PIN. If they do, change it.


- Use "strong" passwords of seven characters or more with a combination of upper- and lowercase letters, numbers, and special characters—and change them periodically.


- Do not use the same user IDs and passwords for high-risk transactions like online banking, brokerage, and PayPal as you do for lower-risk activities like online subscriptions and social networking sites where security may not be as robust.


- If you cannot remember all your passwords, consider using a secure, encrypted password protection device or                software that is available as a stand-alone device or application for many computers and smartphones.


- Password protect computer files that contain sensitive personal or account data, and make use of available encryption technology for your computers and smart devices.


- Shield the keypad when using an ATM.


- Never open attachments or links in unsolicited e-mails.


- In general, use caution regarding e-mails containing links.


- Do not respond to suspicious e-mails in any manner.


Copyright 2017
International Risk Management Institute, Inc.


Choose Safety Features on New Cars Carefully

Safety features and semiautonomous features on new automobiles are growing at a breakneck speed. Although they are not foolproof (e.g., bike lanes and snowstorms cause all sorts of visual recognition difficulties), the automotive jury so far is giving many of these features a solid thumbs up. Car and Driver magazine has test-driven many of these autos, and it reports that the autonomous sensors and algorithms are making tremendous strides in their sophistication and reliability.

Last year, Car and Driver compared the autonomous features of four luxury automobiles: the Tesla Model S, BMW 750i, Infiniti Q50S, and Mercedes-Benz S65 AMG. And the winner was The Tesla Model S. Unfortunately, these cars all cost north of $100,000. So what type of autonomous car feature recommendations can insurance professionals make to their colleagues and friends that don't break the bank? The following are some tips to pass on concerning the selection of a newer model automobile regarding safety features and affordable autonomous features.


- Go online and check out the Insurance Institute for Highway Safety (IIHS). The IIHS tests analyze two aspects of auto safety: (a) crashworthiness (how well it protects the occupants in a crash) and (b) crash avoidance and mitigation (technology that can prevent or mitigate a crash). Their website provides a list of its Top Safety Picks (under "Ratings"). For example, under midsize cars, the 2017 Honda Accord sedan earned the highest safety marks. Under small SUVs, the 2017 Nissan Rogue earned the top grades. The best marks are indicated by the symbol TSP+ (Top Safety Pick Plus). These autos can be used to create your shopping list. The website also has a nice selection of videos that vividly illustrate many of the autonomous features, such as crash avoidance.

- Another worthy website is that of the National Highway Traffic Safety Administration. This governmental entity performs exhaustive tests on crash protection and rollover safety of new vehicles beyond what federal law requires. Its 5-Star Safety Ratings program ranks vehicles from one star to five stars.

- As far as "must have" autonomous features are concerned, one that stands out is the forward collision warning feature (also called smart cruise control). These systems sense slowing or stopped traffic in front of your vehicle. If the algorithm determines that you have not slowed down in the proper time, it sounds a warning. And if you still do not respond quickly enough, the car's brakes are automatically applied for you—thus avoiding a rear-end collision.

- Another vital autonomous feature is blind spot monitoring. As the name suggests, a light on the side-view mirror is activated when traffic is coming up beside your car, reminding you not to change lanes. This is especially helpful for senior drivers who lack the neck-twisting capability of younger drivers.


A rearview video system is also highly recommended. Also known as a backup camera, this technology helps prevent back-over crashes and protects vulnerable people such as children, senior citizens, and those with disabilities.


Select Home Contractors Prudently

American spending on home renovations and repairs is expected to peak at $327 billion in 2017, according to the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University. A large percentage of this spending is for the services of general contractors and subcontractors. Yet home owners are often unaware of the large exposures that could result in hiring an unlicensed or uninsured contractor, particularly for large projects. For example, an uninsured roofer working on a home may sue the home owner for damages if he is injured on the job. The following tips should be passed on to home owners to help them select contractors to work on their home, especially for major projects.

  • Be wary of contractors who solicit business door to door or via cold calls. In addition, avoid contractors who quote you a price that will automatically go up the next day or week if you don't accept it immediately.
  • Obtain recommendations from friends, family members, and neighbors about experienced and reputable contractors who have performed excellent work for them.
  • Ask for a written estimate from the contractor that includes any oral agreements the contractor makes in this process. The estimate should contain a line-by-line breakdown of costs, including materials and labor.
  • Verify that the contractor is licensed, bonded, and properly insured. Ask for certificates of insurance for workers compensation and general liability policies. You should also receive these certificates for any subcontractor the general contractor may hire to work on your home.
  • Contact the Better Business Bureau to see if complaints have been filed against the contractor. This can be performed via the bureau's website at www.bbb.org.
  • Obtain a copy of the proposed contract. Ideally, it should include a hold harmless clause in your favor, particularly for major work such as when heavy equipment will be used in constructing a swimming pool. A hold harmless clause specifies that the contractor will indemnify you with respect to your liability to members of the public who are injured or whose property is damaged during the course of the contractor's operations. The contract should also explicitly establish an independent contractor relationship.
  • Ask an experienced attorney to review the home repair contract before you sign, particularly for large remodeling projects. 


Don't Become an Auto Insurance Fraud Victim

The Insurance Information Institute (I.I.I.) reports in its August 2016 article, "Insurance Fraud," that property and casualty insurance fraud costs our society approximately $32 billion annually, which is about 10 percent of the industry's incurred losses and loss adjustment expenses. According to some estimates, this insurance fraud adds about $200 to $300 annually to total insurance premiums for the average household. Auto insurance fraud accounts for a large segment of these losses, which are ultimately passed on to you, the auto insurance consumer, in the form of higher insurance premiums.


Auto insurance fraud can occur in a variety of ways. For example, unethical groups of doctors and lawyers can team together to overtreat patients and thus exaggerate claims. Staged accidents are also a common problem, in which a conspirator's car pulls in front of an innocent driver's automobile and stops suddenly. This action causes the innocent driver to rear-end the conspirator's vehicle. Thus, the innocent driver often believes he or she is negligent. Typical victims are usually driving alone in new and expensive vehicles. In many cases, the criminal driver uses a large, older sedan with several passengers inside.

There are several ways by which you can avoid becoming a victim of these "staged accidents," including the following.


  • Avoid tailgating at all times and focus on driving defensively.
  • Obtain the names and driver's license numbers of all occupants in the other car.
  • Attain the names and key information of witnesses.
  • Take photos of the damage to the autos.
  • Report your suspicions immediately to your insurance agent. You can also report your concerns to the National Insurance Crime Bureau's toll-free hotline at (800) 835–6422. Your call can be anonymous, and you could be eligible for a reward.



Protect Your Interests after an Auto Accident 

While we certainly hope that you are never involved in an auto accident, we realize that they do happen. That's the reason we're in business; that's the reason you trusted us to find the right auto insurance for you. If you are ever involved in an accident, the following suggestions will help the claim process move ahead smoothly. Please print this out and keep a copy in your glove box.


· Make sure that everyone is unhurt—in your car and any others involved. If anyone is injured, call 911 immediately. Even if you think your injuries are minor, it is probably a good idea to have them checked out—either at the hospital or with your family doctor. A seemingly minor injury could turn out to be more serious.

· Call the police. They can help defuse a difficult situation and ascertain who is at fault. Make sure that police on the scene get the names, addresses, and phone numbers of all other involved parties. Ask for a copy of the police report from the officer.

· If you happen to have a camera with you—or a smart phone—take some photos of the vehicles involved, the general area where the accident occurred, and skid marks.  (And don’t forget license plates, drivers’ licenses and proof of insurance cards).

· If possible, safely move the cars out of the way of traffic.

· Do not admit or discuss liability with anyone other than staff at our office or your insurer.

· Get the following information about everyone involved in the accident: name, address, driver's license number, license plate number, description of car, e-mail address, all phone numbers (home, work, and cell), and auto insurance information. Also, obtain contact information from any witnesses to the accident.

· Get the following information about everyone involved in the accident: name, address, driver's license number, license plate number, description of car, e-mail address, all phone numbers (home, work, and cell), and auto insurance information. Also, obtain contact information from any witnesses to the accident.

· Report the accident immediately to our office (916)236-3351, or directly to your insurance company.

· While the details are still fresh in your mind, write your own account of the accident. Be sure to make note of anything the other involved parties said about their injuries or about how they may have contributed to or avoided the accident.


How Safe Are Your Holiday Decorations?

Each year, holiday season fires in the United States claim the lives of more than 500 people, injure 2,200 more, and cause more than $500 million in damage, according to the American Red Cross's "Holiday Home Fires Fact Sheet." And the top 3 days for home candle fires are Christmas Eve, Christmas Day, and New Year's Day. Yet, there are simple lifesaving steps you can take to ensure a safe and happy holiday. By following some of these precautionary tips, you can greatly reduce your chances of becoming a holiday fire casualty.

Christmas trees. When buying a live tree, make sure the needles are green. The needles should not break if the tree is freshly cut. If you bounce the tree on the ground and needles fall off, the tree is too dry and should not be used. When you put the tree up in your home, be sure to keep it away from heat sources. Don't put it up too early, and don't leave it up for more than 2 weeks. Always be sure that it has plenty of water. When you take the tree down, do not burn it in the fireplace. Recycle it or have it hauled away by a community pickup service.

Holiday lights. Before using your lights, inspect them for bare spots or frayed wires, and use only lights that a testing lab has approved. Be sure not to overload your circuits; the best way to do this is to avoid stringing together more than three strands of lights. And never leave your holiday lights on when you are away from your home.

Holiday decorations. All holiday decorations should be flame resistant. Be sure to place them away from heat sources. You should not burn wrapping paper in your fireplace. Such a fire may throw off sparks or produce a chemical buildup that could cause an explosion.

Candles. Always place candles in steady holders where they cannot be easily knocked over, and do not go out of the house with candles burning inside. If you do use candles during the holidays, be sure to have a fire extinguisher nearby. And never use candles near a flammable source, such as paper or curtains.

Smoke alarms. December is an excellent time to change the batteries in your smoke alarm, which should be done annually. If your smoke alarm is hardwired into the home's electrical system, be sure that it is working.

Copyright 2016
International Risk Management Institute, Inc.

Bump Up That Deductible

Insurance consumers are constantly looking for ways to save on their personal lines insurance costs. Some of these ways are smart; some, not so much.

Many consumers request reductions in the dwelling limits on their homeowners policy or reductions in the policy's liability limits. Some customers even request reductions in the limits of liability on their auto insurance policies. In most cases, these types of requests are not wise. We cannot stress enough how much you have to lose if a liability judgment goes against you -- for example, in an auto accident or if someone is injured while at your home.

A wiser way to save money on your insurance premiums is to increase your property deductibles. On a homeowners policy, going from a $500 to a $1,000 deductible (or a 1 percent of the dwelling limit deductible) may result in a savings of between 10 and 20 percent on the premium. This savings can be set aside to handle the higher deductible should a loss occur.

Higher deductibles on the physical damage section of your auto insurance are also a good way to save some money on the premium. A $500 deductible on both comprehensive and collision can save you up to 30 percent on these coverage lines. A $1,000 deductible would result in even greater savings.

Another advantage of higher deductibles is that you will handle smaller losses on your own, increasing the chances of a pristine loss record. This type of clean record can result in lower insurance premiums down the road.

Lastly, with more "skin in the game," you will be more likely to practice safe driving and to make sure your home is in tip-top shape. Switching to higher deductibles is a much smarter risk management choice than reducing coverage limits.

Copyright 2015
International Risk Management Institute, Inc.


Thwart Dog Bites

Did you know that dog bites cause over 2,000 injuries that require immediate medical care in the United States each day? You can be held legally liable if your dog bites someone. Fortunately, this loss is usually covered by the homeowners policy, with some exceptions. In fact, around 33 percent of all liability insurance claims paid by homeowners policies are for dog bites! Even if your insurance covers the claim (and any ensuing lawsuit), however, imagine the personal grief you and your family would feel for the injured friend, not to mention the time and trouble you would incur in cooperating with your insurer in defending the claim following a tragic event involving your pet.

Therefore, thwarting such an ill-fated occurrence should be your primary objective, and there are steps you can take to reduce or prevent dog bites. Here are some suggestions from the professionals.

  • Consider dog breeds carefully prior to selecting a pet. Some breeds are more aggressive than others, and a veterinarian can help you decide which breeds might best fit your lifestyle.
  • Spay or neuter the animal, as this often decreases the aggressiveness of dogs.
  • Seek a veterinarian's advice quickly if your dog becomes aggressive.
  • Socialize your dog from an early age to encourage appropriate behavior.
  • Never leave dogs alone with small children.
  • Avoid aggressive games with puppies and dogs, such as tug-of-war.
  • Do not place your dog in situations where he or she can be teased or feel threatened.
  • Train your dog to obey commands.
  • If your dog does bite someone, a board-certified plastic surgeon should treat this person to minimize scarring and potential disfigurement.

There is one other loss exposure concerning dogs you should consider. You may face liability claims if your dog gets out into the road and causes or contributes to an auto accident. You can be sued for violation of leash ordinances by allowing your dog to "run at large." Use a well-maintained and sturdy fence or other safeguards to reduce this exposure.

And if your dog does injure someone despite all your efforts to avoid it, report it to your insurance company immediately to assure your coverage is not jeopardized for late reporting.

Copyright 2016
International Risk Management Institute, Inc.

Are You Smart with Your Smartphone?

A Dallas insurance professional was recently mugged in broad daylight at a Dallas Area Rapid Transit station. As he was checking his iPhone for messages, two teenagers ran up to him, grabbed his brand-new phone, knocked him over, and sprinted away. He had 12 stitches on his face and 7 on his arm. His knee was also severely bruised. A Dallas police officer told him that they field 2–3 incidents like this per day.

A 48-year-old Dallas woman was looking at her cell phone as she began to cross the street a couple of months ago. She was fatally struck by a motor vehicle, with two witnesses stating that she failed to look for oncoming traffic before stepping into the intersection.

The driver of a Tennessee school bus that crashed last December, resulting in the death of two students and a teacher's aide, was reportedly receiving and sending texts just before the accident. The US Department of Transportation reports that cell phones are involved in 1.6 million auto crashes each year, causing hundreds of thousands of injuries and costing 6,000 lives.

With these unfortunate situations in mind, here are some cell phone safety tips to remember and share with others.

  • Keep your cell phone out of sight while in public settings. When there are lots of people milling about, your cell phone should not be in your hands.
  • Put your cell phone in your pocket or your purse if you are a pedestrian. Paying close attention to your surroundings is vital when walking or jogging the streets of a city.
  • Do not write, send, or read a text or talk on your phone while driving. These actions put you (and those around you) in harm's way. You may also be breaking the law, especially in school zones.
  • Share your location mindfully. More apps now allow you to pinpoint your friends' locations. If you use an app like this, do so only with trusted friends and family.
  • Use your smartphone's security features and activate the "find my phone" feature. Check out these links for details.

 Apple device: Find My iPhone Activation Lock

Android device: Turn Android Device Manager on or off


Fend Off Those Home Burglars

The Federal Bureau of Investigation reports that there are over 2 million burglaries per year in the United States. Nearly two-thirds of these burglaries occur in residences. Approximately 30 percent of all burglaries happen through an open or unlocked window or door. A home burglary occurs every 13 seconds in America.

There are numerous things a home owner can do to reduce his or her chance of being a victim of this unfortunate crime, including the following.

  • Keep your windows and doors locked, since burglars obviously prefer easy access.

  • Install heavy-duty exterior doors.

  • Safeguard doors with extra-long screws and high-quality door locks.

  • Utilize a motion-sensing switch for your outdoor lights.

  • Trim your shrubs and bushes so that windows and doors can easily be seen from the street.

  • Ask for a crime assessment inspection of your home from your local police department. They are typically available free of charge.

  • Keep your garage door closed, even when you are inside your residence.

  • Utilize a property identification marking system for your valuable possessions.

  • Store small valuables, such as rare coins and expensive jewelry (that you do not typically wear), in a safe-deposit box at your bank.


Copyright 2016
International Risk Management Institute, Inc.