Life events that should trigger a call to your insurance agent

All too often, people only think about insurance when they have a loss or when it’s time for an annual insurance policy such as auto or homeowners to renew. That’s just human nature. Yet insurance is an important part of financial planning and deserves more consideration than a quick search for the cheapest quote come renewal. As with any other purchase, cheapest is not always the best purchasing criteria – you get what you pay for. While there is certainly no sense in spending more than you need to, you should be sure that the insurance package you buy will provide sufficient coverage for your particular situation. The question lies in what’s sufficient coverage – and that may very well vary over the course of your life. Insurance is essentially a form of financial risk management that is designed to protect an individual or a business from loss resulting from adverse life events. A single person in their 20s will have very different coverage needs than a middle-aged parent who owns a home and has several dependents.

When certain major life events occur, they should trigger a review of insurance coverage. You may need to add a new type of coverage, you may want to raise or lower deductibles on an existing policy, or there may be opportunities for savings or discounts. Your independent insurance agent will be able to inform you about various coverage options – but can only advise you based upon what he or she knows. It’s good to keep insurance coverage in the back of your mind, and get in the habit of making a call or dropping a note to your local agent when you experience a major life event, such as any of the following:

  • Marriage
  • Divorce
  • Birth or adoption of a child
  • Death of an immediate family member
  • Military deployment
  • Purchasing a new home, condo, or a second home
  • Home renovation
  • Adding buildings to your property
  • Renting out your home
  • Moving to a new geographic area
  • Renting an apartment
  • A teen child getting an auto license
  • Changing jobs and job benefits
  • Starting a small business
  • Acquiring expensive electronics, antiques, jewelry, furs, or specialty collections
  • Acquiring a recreational vehicle – boat, motorcycle, snowmobile
  • Joining a carpool
  • Retiring

Insurance issues for U.S. military service members & their families

On this Veteran’s Day 2009, we recognize and salute all U.S. veterans. We appreciate your service to our great country – thank you! For those who would like to show appreciation in a concrete way – why not hire a vet? And we also call your attention to a worthwhile cause that helps to address some of the seriously wounded veterans of recent conflicts: The Wounded Warrior Project provides services and programs to ease the burdens of the most seriously wounded and their families, to aid in the recovery process, and to smooth their transition back to civilian life.
Insurance issues related to the military
The National Association of Insurance Commissioners (NAIC) has put together a great resource on insurance issues as they specifically relate to U.S. military service members and their families, noting that insurance coverage can often be affected when someone moves out of state or spends an extended period of time away from home. NAIC suggests that military members talk to their agents before deploying to make arrangements for insurance renewal and payment to ensure that they do not lose important coverage. The site covers life insurance issues specifically as they relate to military service members, including buying tips and red flags for deceptive practices. The site also addresses other types of insurance coverages, including homeowners, rental, auto and health insurance. There are many considerations and issues to discuss with your agent: if your home will be vacant, check to see if your insurer has a vacancy clause that would limit your coverage; find out how your homeowners insurance will cover any possessions you have with you while deployed; and check to see if your auto policy will allow you to suspend some or all of your coverage.
NAIC also suggests that deploying service members may want to consider assigning power of attorney to a spouse, family member, or trusted friend who could act on your behalf in insurance, financial, personal, or legal matters. The site offers a list of links to helpful resources for other sources of benefits and assistance.
Avoiding insurance & investment scams and ID theft targeting military families
Service members and their families are good targets for fraud: they are away from home for extended periods while mobilized in service; families are often transient; paychecks are regular and predictable; and returning service members often have extra cash from combat pay. In TRAPPED! Financial Scams Are Targeting Military Families, Kimberly Lankford of Military Money discusses common scams and offers tips and resources to help you avoid becoming a victim.
To minimize the risk of identity theft while deployed, military members may want to place an “active duty alert” in credit reports. According to the Federal Trade Commission (FTC), the alert would require creditors to verify your identity before granting credit in your name. Active duty alerts on your report are effective for one year, unless you request that the alert be removed sooner.
The FTC also encourages service members to file complaints through the Consumer Sentinel Military Network, a secure online database of complaints from the military community. While the FTC doesn’t resolve individual disputes, complaints help the effort to target cases for prosecution, shut down scammers, spot patterns of fraud before they become widespread, and alert the military community to scams.
Workplace issues
Employers need to be aware of their legal obligations to employees on military leave as well as legal obligations to veterans under the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA). In addition to legal obligations, it’s important for employers to take steps to help service members make the transition back to the workplace. Also, the Insurance Information Institute offers advice on What employers and their insurers need to know about returning veterans. There are many issues that may relate to overall benefits, workers compensation, and the Americans with Disabilities Act (ADA).

Scammers thrive in bad economy, recessions

When times are tough, rest assured there are always scam artists around to try to make things worse. The Federal Trade Commission recently announced that it is launching a major sweep to target fraudsters and scammers who proliferate in economic downturns. Scammers thrive on people’s very human vulnerabilities: fear, stress, anxiety, greed, vanity, honesty, and compassion. Where once scammers would use mail, phone, or even local solicitation, today easy to e-mail and websites allows scammers another avenue, one that can deploy pitches widely and quickly. Common schemes in this economy include get-rich-quick schemes, debt-reduction scams, job recruitment scams and work-at-home scams. Authorities warn people to beware of any jobs that require fees: “Pitches for bogus work-at-home opportunities involving medical billing, rebate processing, “mystery shopper” positions that promise to pay you for buying products anonymously for companies, and money-order processing jobs also are on the rise, say Better Business Bureau and consumer-protection officials.”
Then National Consumers League has recently released its semi-annual ranking of the top telemarketing and Internet scams:
Top Scams, Jan. – June 2009
1. Fake Check Scams
2. Internet: Gen Merchandise
3. Prizes/Sweepstakes/Free Gifts
4. Phishing/Spoofing
5. Nigerian Money Offers (not prizes)
6. Business Opportunities/Franchises/Distributorship
7. Advance Fee Loans, Credit Arrangers
8. Friendship & Sweetheart Swindles
9. Internet: Auctions
10. Lotteries/Lottery Ticket Buying Clubs

  • If it sounds too good to be true, it most likely is
  • Be super cautious in giving out personal information to anyone, particularly online
  • Learn how to protect against phishing and other online scams designed to get your personal information or your money
  • Don’t send money to anyone you don’t know
  • Avail yourself of consumer protection tools and resources – we’ve compiled some below

Consumer Fraud Resources
FBI Scam Alerts
Federal Trade Commission Bureau of Consumer Protection
Federal Citizen Information Center – Consumer Action Website
Better Business Bureau
State Attorneys General – site links and telephone numbers
State, County, and City Government Consumer Protection Offices
Insurance Scams
Identity Theft Resource Center
National Consumer Law Center

Vacation and second home insurance

If you’re planning a trip to a vacation home, it’s a good idea to think about insurance coverage before you go. Whether you plan to vacation in a second home or visit a time share, a rental property, or a home exchange, the National Association of Insurance Commissioners (NAIC) offers useful vacation home and property insurance considerations.
It’s a good idea to check your policies to be clear about the extent of what they will and won’t cover while you are traveling and staying in some type of temporary lodging – generally, a Homeowners policy will extend some coverage for your personal belongings. Also, be sure to review any trip or travel benefits or coverage that might be available from your credit card.
If you have a second home for vacation use, the insurance issues require more consideration. Homeowners coverage for a second home can vary significantly from the terms in your principal home’s insurance policy and requirements may be different if you are in a different state or a different area. Your coverage needs will vary depending on how often your home is occupied and whether the home is for your own use – owner occupied – or whether you rent it to others. You may need additional coverage if your vacation home is a waterfront property or if it is located in an area that is subject to natural disasters such as hurricanes or floods. You may also need additional coverage such as boat insurance or “named peril” insurance.
We often don’t think about insurance until we need it – and then, it can be too late. If you haven’t considered the insurance issues related to a second vacation home or to temporary vacation lodging, you might want to give your agent a call.