Umbrella Insurance Policies: Not just for the wealthy

While you most likely have insurance on your home and car — and you do, don’t you? — you may not be completely covered. If you were the target of a multi-million dollar liability lawsuit, what would happen when your insurance coverage was exhausted? Could you lose your home and all your assets? The answer to the last question, sadly, is yes and that is the point of umbrella insurance policies – they kick in after traditional insurance policies have been exhausted. An umbrella insurance policy helps to protect you from being completely wiped out even if you get sued for an automobile crash or an accident at your home that costs more than your liability insurance company is willing to pay.

Traditionally, these were the choice of wealthy individuals and families, but umbrella policies are gaining in consumer popularity and are increasingly being purchased by the middle class. In this litigious society, a nip from the family hound or a fall on the family trampoline can lead to enormous liability lawsuits that can quickly exhaust even comprehensive insurance policies.

Who should have umbrella coverage? Some experts recommend that anyone with dogs, teenage drivers in the family or high risk yet attractive recreational facilities like pools, trampolines or ATVs should consider an umbrella policy. We recommend that you talk to your independent insurance agent in the context of your total coverage needs, which should be reassessed periodically. Your agent can help you assess whether such a policy would us right for you and can find the right insurance policy, if so. Sometimes, you can even cover the cost of an umbrella policy simply by raising the deductible on your home or auto policies.

According to the Insurance Information Institute, umbrella policies are typically sold in $1 million increments and cost on average between $150 to $300 a year for the first $1 million in additional coverage. The next million will typically cost about $75 annually and about $50 for every million after that. Most insurance companies will not write one unless you already carry liability insurance of about $250,000 on your auto policy and $300,000 of liability insurance on your homeowners policy.

Just like knowing that you always have an umbrella in the car on a rainy day, an umbrella insurance policy can give you extra peace of mind. In this uncertain world, that might be worth a couple hundred dollars a year.

Rains bring a reprieve, but it’s still good to prep for wildfires

Did you hear a loud whooshing sound when the rains began this past weekend? If so, it was probably a collective sigh of relief by fire marshals and emergency workers throughout New England. We had a bad few weeks of drought. With any luck, it’s over, but time will tell. We were at heightened fire risk because there is a high level of dry, felled tree debris from the freak Halloween storm and some high wind events over the winter.
Wildfires are fires that start outside developed areas. Also known as brush fires, grass fires, vegetation fires and Smokey the Bear’s nemesis, forest fires, uncontrolled wildfires have been making headlines in recent years as they devastate increasingly large portions of the USA. Wildfires have long been a huge issue for the Western states, but widespread drought conditions over the last few years have made them a real hazard on the East coast as well. Many New Englanders were startled by the odor of smoke and the pall in the air from last May’s huge Quebec fires. And this season has begun ominously with the recent spate of wildfires up and down the East coast.
A wildfire differs from other fires by its extensive size, the speed at which it can spread out from its original source, its potential to change direction unexpectedly, and its ability to jump gaps such as roads, rivers and fire breaks. The primary cause of wildfires in the US is lightning, although many wildfires are attributed to human sources such as arson, discarded cigarettes, sparks from equipment, and power line arcs. Prolonged drought dramatically increases the risk of wildfires, as underbrush becomes tinder dry. The past winter saw record low amounts of snowfall in New England, leading to much dryer vegetation than usual and an accompanying greater risk of fire. Human development can also add risk factors, as was an issue in last spring’s Texas fires, centering around the rapidly growing city of Austin.
While wildfires are unpredictable by their very nature, you can take steps to minimize your risk and possible fire damage. First of all, be aware of any current risk factors. You probably are already familiar with NOAA’s severe weather warnings but did you know they also have fire risk watches and warnings? Keep this fire risk map bookmarked and check it now and then to assess your community’s risk. The goal of an effective wildfire protection plan is to keep the fire from coming dangerously close to any structure on the property. Any structure or planting that’s too close to your home or business can act as a wick, drawing fire to the buildings.
Follow these simple steps to minimize your possible damages.
Roofs: Choose a Class A rated fire covering for your roof and keep the roof and gutters free of debris.
Attics and Vents: Attics and vents can serve as entry points for windblown embers. Cover yours with 1/8 inch metal mesh screens.
Attachments: Awnings, decks, patios and porches can act as a wick bringing flames to the building. Consider taking down any awnings and clearing all decks or patios if the fire risk is currently at warning level or if any fires have been reported in your area.
Windows: Radiant heat from a wildfire can break single-pane windows; instead, choose dual-pane windows with tempered glass for increased protection. Make sure to close all windows before evacuating for a fire or, in areas of fire warning, keep them closed.
Plantings: Be extremely careful with landscaping within 15 feet of your home or business. Avoid plants that generate ground litter from bark, leaves, or seeds that slough off and those that have very low moisture content or small branches and needles that can easily ignite. Regularly prune all underbrush and consider using rock or gravel mulch, particularly directly by your building.
Outbuildings: Storage buildings, trash bins, pergolas, playground equipment, boats, RVs, and other combustible items can allow fire to reach the building. When possible, relocate these at least 30 feet from your home or business. And, while it should go without saying, be sure that propane tanks are located at least 30 feet away from any structures.

Insurance on the High Seas

As you doubtless know from the media coverage, the Titanic sank 100 years ago last week. That disaster was long considered to be the most costly maritime insurance loss although the sinking of the Concordia Costa last year in Italy seems to have surpassed it. It’s interesting, therefore, that a Titanic insurance document has just surfaced for the first time in a century. The document, which records the total pay out of £4,000 (an estimated £263,000 or $419,432 in today’s money) by Royal Insurance, now part of the RSA Insurance Group has never before been seen by anyone outside RSA. This was only a small portion of the total insurance payments. As the ship’s hull and machinery was valued at £1 million, owners White Star Line would have had hundreds of different insurers.
The Encyclopedia Titanica has over 100 articles about insurance claims on the Titanic. Initial estimates two weeks after the disaster were that life insurance payouts totaled around $2.1 million, and accident insurance payouts came to a little more than $1.5 million. The industry estimated that life insurance losses would end up at $4 million, accident insurance losses at $2 million. Many passengers carried specific life insurance and travel policies while the survivors of other lost passengers filed claims against White Star Lines. One Mrs. Irene Harris claimed $1,000, 000 for the loss of her husband, a theatrical manager. The first claim settled was for a Mr. Ervin G. Lewy of Chicago and in a morbid note, the article comments that without a death certificate, the company had to “strain certain points” to allow the payment. Eventually, White Star paid $664,000 to settle all the claims.
In a fascinating look back at the insurance industry of a century ago, this New York Times article from April 1912 is highly complimentary to the insurers who settled the Titanic claims so quickly. It also notes that while in the age of sail, a ship was never declared lost until a year and a day after it was expected in port, modern technology – i.e., radios – had changed that age old rule and now ships were considered lost almost immediately upon the disaster.
While the golden age of ocean liners is undoubtedly past, cruise ships are at sea in record numbers. While the chances of anything happening on a modern cruise are so slight as to be almost nil, you, like John Jacob Astor, may want to consider buying travel insurance if you’re planning a voyage on the ocean deep. And you should periodically evaluate your life insurance coverage – a good idea whether you’ll be taking any ocean cruises or not. Your independent Renaissance Alliance insurance agent can help!
*Image source: PD-US – The Titanic

Increase in Off Site Workers Intensifies Small Business Data Risks

Small businesses have become more aware over the years of the importance of data protection and backup. It’s a rare company that doesn’t have backup procedures in place, but it’s always a good idea to make sure those policies and procedures are up to date. Since surveys show that the average data breach costs a company $7.2 million, or $214 per breached record, properly protecting your company’s data should always be one of the top items on your priority list. Plus, many states are enacting laws about customer data privacy and security, and at this writing, 46 states, the District of Columbia, Puerto Rico and the Virgin Islands have enacted legislation requiring notification of security breaches involving personal information.
Experts recommend that you routinely back up your data, develop data and disaster recovery plans and educate your employees to the importance of customer data security.
The last is crucial in today’s increasingly mobile society. A recent survey has found that up to 80% of workers in small to midsize businesses routinely use their own portable devices such as laptops, iPhones and iPads to work from home or on the road. Although most companies have formal policies in place to protect their vital data in the office, a surprising data protection gap has emerged with the growth of off site workers. Fully one third of companies let employees make their own decisions about how -or whether – to back up company and client data on their own devices and as a result, valuable data could easily be lost or compromised. Instead of these informal arrangements, it’s a good idea to implement a formal Acceptable Use Policy that may include installing security software on the employee’s device.
If your business entails storing personal customer data electronically, you should talk with your independent insurance agent about exactly what your business liability insurance covers and discuss whether you need a specialized product to cover data loss coverage and electronic data liability to deal with the aftermath of a data breach. And while you’re having that discussion, you might also inquire about cyber liability coverage for protection against various legal liabilities related to disseminating information via the Internet.

Insurance 101: What is “other structures” coverage?

This is a guest post from Renaissance Alliance member agency Encharter Insurance.
Are you in the market for a home insurance policy? While talking with agents you may hear terms that don’t sound familiar to you and wonder why they are a part of your coverage package. While each homeowner’s insurance policy is designed to best suit you and your family’s unique needs, one type of coverage that you may come across is “other structures coverage.” Individuals frequently ask what other structures coverage is and why it is automatically included on their policies. Those “other structures” include items such as pool houses, cabanas, and garages. Typically this coverage will go further and even cover things such as fences, sheds, barns, and in-ground pools. Considering all of the other structures on your property, this aspect of your home insurance may oftentimes be too easily overlooked.
Other structures coverage makes up 10% of your dwellings coverage and you do have the ability to increase it. For more information about your other structures coverage, or if you would like to increase the coverage, talk to your independent insurance agent. Talking with an expert is a great way to make sure you know exactly what your insurance covers and that it is taking care of the needs of you and your family.