CYBER RISKRead Now
Data breaches and cyber attacks have increased 42%.
40% of all breaches involved smaller companies.
All industries are vulnerable.
Average cost of data breach has risen to $5.4 million.
Tue, Nov 26, 2013Read Now
Why an individual would buy cash value life insurance. Quick tip:
• Life Insurance is the rich man’s Roth IRA
Think about that for a moment. With a qualified Roth IR,A a married person earning more than $188,000 a year cannot contribute to a Roth IRA. A single person earning more than $127,000 would also be ineligible for a Roth IRA.
Life Insurance has qualities similar to a Roth IRA in that money grows tax deferred, and can be withdrawn income tax-free (if structured properly). The two main advantages with life insurance is you do not have a contribution limit, and there is no contribution phase-out based on income.....
Thanksgiving fun facts - 2013Read Now
Here are a few facts about Thanksgiving that may be new or interesting to you:
Happy Thanksgiving from Stinson Insurance Services!!
Why I Don't Want to Buy Life Insurance
If you're like most people, it's not that you don't appreciate the value of life insurance. In fact, many people believe they need more coverage. You probably wouldn't mind owning additional life insurance. It's just that you don't want to buy it.
Thinking about buying life insurance, talking about buying life insurance, discussing the reasons for buying life insurance--all of this makes many people feel uncomfortable. Here are just some of the reasons why you may be putting off buying the life insurance you know you need.
You'll get around to buying life insurance, but not today. With all the things you've got to do, buying life insurance can come off as a low priority--just one more thing you ought to do. Plus, the whole idea of discussing life insurance isn't a whole lot of fun. Who wouldn't rather take the dogs for a walk on the beach, attend a child's softball game, or spend those precious few hours of free time in the evening visiting with friends?
Nonetheless, buying life insurance is really an important task that should be addressed. Life insurance can help ensure that your family will have enough money to meet their financial obligations in the event of your death.
If you really don't like to think about death, you're not alone. Death is an unpleasant subject, and life insurance raises issues of our own mortality. Some people say that the very thought of starting the life insurance buying process makes them feel stressed out. There's no great appeal to contemplating our own mortality. It's a subject we'd rather ignore than address. The result can be inertia or denial.
It doesn't have to be that way. People who do act on their life insurance needs tend to focus on the positive aspects: the idea of meeting their responsibilities to provide for, and care for, their loved ones. They think of it as contingency planning, protecting their families against the uncertainties of life. They also recognize that life insurance is really about life and love, about helping to ensure a positive quality of life for their spouse and children if they die prematurely.
If you don't have a clue about which type of policy is right for you, or how much life insurance you need, join the club. Few of us truly understand life insurance: why we need it, what type of policy is best, how much we need, when and how benefits are paid, how benefits may be taxed, and more. That's okay. It's not your job to know everything about life insurance. That's the job of an insurance professional.
Thinking you need to have all of the answers about which type of life insurance is best for you is sort of like needing surgery and thinking you need to know which type of scalpel to use. That's the surgeon's job. In the same respect, the right insurance professional can guide you through the process of selecting the policy that best suits your needs, budget, and objectives, and can answer your questions.
For many underinsured people, it's not so much that they don't want the life insurance they need; it's just difficult to find the extra dollars to pay for it.
Buying life insurance you can't afford benefits no one. If it causes your family hardship or requires you to make choices that seem incongruous ("Gee kids, I'd love to take you on vacation, but our life insurance premium is due"), you'll eventually discontinue the policy. Then you lose, and your family loses.
That's why it's important to purchase a policy that meets your needs and your budget. Fortunately, there are many types of life insurance available. These include term life insurance policies and various types of permanent (cash value) life insurance policies. Term policies provide life insurance protection for a specific period of time. If you die during the coverage period, your beneficiary receives the policy's death benefit. If you live to the end of the term, the policy simply terminates, unless it automatically renews for a new period.
Permanent insurance policies offer protection for your entire life, regardless of future health changes, provided you pay the premium to keep the policy in force. As you pay your premiums, a portion of each payment goes toward building up the policy's cash value, which may be accessed through loans or withdrawals. (Keep in mind, though, that loans and withdrawals will reduce the cash value and the death benefit, and could cause the policy to lapse). The cash value continues to grow--tax deferred--as long as the policy is in force.
The bottom line
It's easy to understand why people tend to put off purchasing the life insurance they know they need. But look at it this way: buying life insurance is one way you can help secure your family's financial future. And what could be better than knowing your loved ones will be protected, even if you're no longer around to take care of them?
Do your homework when buying insurance..
As you search for the best insurance for your needs, examine these myths about insurance.
Myth #1: All insurance companies are basically alike.
Truth #1: Insurance companies vary in the financial strength that backs your policy, assuring they can meet their obligations to pay claims. Look for an insurer that is financially strong and consistently qualifies for a high financial strength rating from A.M. Best Co., an independent provider of insurer ratings.
Find a local independent agent who lives in your community. An independent agent has a long-term stake in protecting you by following through to your satisfaction
Myth #2: All insurance policies provide the same coverage.
Truth #2: While many insurance policies contain similar coverages, each company provides unique policy conditions and limitations. Policies that look alike can be changed by a single exclusion or endorsement. Read your policy carefully.
Myth #3: All insurance companies provide the same level of service or claims service.
Truth #3: Your state department of insurance and the National Association of Insurance Commissioners can tell you which companies have the fewest complaints and resolve them effectively. Look for a company that provides personal treatment, prompt contact and fair settlement.
Myth #4: You have no control over the cost of your insurance.
Truth #4: An independent agent can pinpoint exactly how changes in your deductible or your lifestyle can lower your insurance costs. He or she can propose safety measures that earn discounts or tell you how to package one policy with another to save money and improve coverage.
Independent insurance agents make a living by knowing which companies act responsibly and which policies are best for a specific client’s needs. Your local agent can help you make an informed insurance purchase that provides stability, quality and convenience.
Covered by homeowners insurance? Don't be so sure
NEW YORK (Money Magazine)
Bought or renewed a homeowners insurance policy lately?
You've no doubt noticed that premiums have gotten pretty pricey. Rates have climbed 69% over the past decade to an average of $1,000 a year.
What you may not realize is that you could be facing another vast expense. Insurers have also been quietly hiking deductibles, scaling back basic coverage, and adding new restrictions.
Coverage now varies widely among carriers, but that's not always clear when you're shopping around, says Daniel Schwarcz, a University of Minnesota professor who has studied hundreds of policies.
"Consumers shop almost entirely on price and reputation," notes Schwarcz, and exclusion clauses are often written in legalese and buried in a policy that runs dozens of pages. Moreover, comparison shopping is difficult, since consumers rarely get a copy of the policy before they buy.
When disaster strikes, you could get hit with tens of thousands of dollars in costs for damages that you thought were covered.
The reasons for the changes are complex. Homeowners is one of the least profitable types of insurance; on average, over the past 10 years firms have lost money on these policies, according to the National Association of Insurance Commissioners (NAIC).
Insurers say that's largely because of unpredictable weather. There were 953 "weather events" insurers considered catastrophes in the U.S. in the past five years, compared with 602 in the previous five, according to industry data.
In 2011 the amount insurers paid out for the average claim was nearly double the amount in 2002, according to the Insurance Research Council. More trouble: Firms make money in part by investing your premiums; that means at times they can recoup higher claims costs with market returns. The financial crisis and low interest rates haven't provided much relief there.
To cope with squeezed profits -- and so they could beef up their reserves to pay for freak massive storms -- insurers stopped writing new policies in some disaster-prone areas in recent years and pushed for higher premiums. Regulators pushed back on the prices. "If we allowed the rate increases companies wanted, nobody would be able to afford insurance," says Kevin McCarty, Florida's insurance commissioner and a past NAIC president.
So insurers made up the gap by cutting coverage, leaving homeowners in a precarious position, say consumer advocates. "It's easy to think you're covered when you're not," says Amy Bach, executive director of advocacy group United Policyholders, which has lobbied the states to reject stripped-down policies and make coverage more transparent.
For the foreseeable future, however, the onus is on you to make sure your biggest investment is fully protected. In the following you'll find out where your coverage most likely falls short and learn the best way to plug those holes.
MORE: Water damage
WATER: Coverage is thinner than you think.
A shower pipe bursts behind the bathroom wall -- you're covered, right? Maybe not.
In the past decade insurers have scaled back significantly on covering that cracked pipe, leaky toilet, and clogged drain.
Water coverage began getting less generous after a jury in a 2001 Texas lawsuit involving toxic mold awarded a family more than $30 million (later slashed). Toxic mold grows in the damp, and nowadays payments for mold claims are all over the map: 60% of the insurers that Schwarcz studied in a recent analysis of 60 policies in six states capped mold coverage at $2,500 to $50,000; another third paid nothing.
The cutbacks now extend to broader water damage. In Texas, for example, the insurance department found that nine of 10 policies in 2010 were less generous than the state-approved "prescribed" policy (a benchmark created by regulators), nearly double the number in 2002. Your policy probably used to exclude claims from water leaks that occurred over a period of weeks, months, or years. Now it probably specifies that the leak can't have lasted longer than 14 days -- even if the source was hidden, say, behind a wall or under a foundation.
Those limitations snagged Fredi Cohen, who is suing a Florida insurer over its refusal to pay for a burst shower pipe in her late mother's condo that caused an estimated $35,000 in damage in June 2011. Three weeks later an engineering firm hired by the insurer found that the plumbing had been leaking for more than 14 days. By that time, Cohen says, the damage was so old it was impossible for her to dispute the firm's findings. "I was astonished," Cohen says.
Up your protection. Get a rider that covers sewer and drain backups -- generally excluded from policies -- especially if you have a sump pump. Expect to pay 10% to 20% of your premium for such a package. On a Seattle home insured with Safeco for $400,000, $20,000 in such coverage costs $146 a year, according to NRG Insurance.
Be vigilant about prevention. Place wireless water alarms ($25 for three) under your sinks and behind the water heater and washer -- they'll go off at the smallest leak. Eye your water bill for unusual activity, which could alert you to a larger problem (say, a leaky hose in the yard).
REPAIR: Real-world costs may exceed your check.
Insurers used to provide a guarantee that they'd pay to fix your home no matter what. But after so many widespread catastrophes, they've pared back.
One reason is the "demand surge." After a big storm, contractors and building supplies are in unusually short supply. The temporary shortage drives up prices. Today you'll rarely find guarantees, and certainly not in disaster-prone states (instead, your policy will simply say it covers "replacement costs").
If you want better protection, you need to buy optional extra insurance, or "extended" replacement, which kicks in to deal with unforeseen costs. Also, insurers have added lots of caps and limitations. For example, many eliminated coverage for screened-in pool enclosures and patios after Hurricane Wilma in 2006 tripled the price for those items. Allstate's new House & Home policy says the older the roof, the less Allstate pays toward replacing it.
Even if your replacement benefit will pay for your losses, you may be subject to picky rules for filing claims. Your insurer first will hand you a check for what it calculates is the actual cash value of what you've lost, accounting for depreciation. Then, once you actually replace the items or rebuild, insurers pay the extra cost. Specific requirements vary among carriers. Some say only that homeowners must notify their insurers of their intent to replace within six months. Others mandate that the work must be completed in six months. Policies also differ by state; some require insurers to offer more time, such as Maryland (two years) and California (one year).
Paula and Michael Sher were tripped up by this kind of fine print after a fire severely damaged their Long Island home in July 2008. Between getting permits and winter storm delays, they say rebuilding took more than two years, but their Allstate policy said they had to have been finished within six months to claim $97,000 in extra replacement-cost benefits. The Shers sued, saying the requirement is unreasonable. An Allstate executive says the company has found that 180 days is "more than enough time" in the majority of cases. After discussions with regulators on multiple complaints, however, Allstate changed its New York policies, so it now allows two years for rebuilding (the Shers' case is pending).
Get extended replacement coverage. A typical rider costs about 10% of your premium and will tack an extra 25% onto your replacement benefit, enough to cover most situations. Also buy replacement-cost coverage for your personal property (about 10% of the personal-property premium); basic policies typically reimburse based on the depreciated value.
Understand what you're getting. Few homeowners take the time to read their policy and, even if they do, may not realize how one phrase -- sometimes one word -- can mean thousands of dollars come claim time.
Gregory and Moira Taylor, for example, thought they were covered when a heavy 2010 storm caused the carport at their Maryland home to collapse. Their State Farm policy included the "sudden, entire collapse of a building"; plus, their agent told them it was covered, according to state insurance department documents. State Farm, however, denied the $1,706 claim, saying a carport does not meet the criteria for a building (which must have a roof and at least three walls). The Maryland insurance department agreed with State Farm, but the assistant attorney general is appealing the decision to the state supreme court.
Get it in writing. Make sure to document your steps in rebuilding, such as interviewing contractors and applying for permits.
Ask for an extension. Think you won't meet the time limit? Call your insurer and request a reprieve. If you're denied, file a complaint with your state insurance department and ask it to intervene on your behalf.
Make a thorough home inventory. Document every inch of your home and you lower the chances you'll have to fight over coverage for your personal property. Use the free app from knowyourstuff.org, or hire a home inventory professional (find one through nahip.com) for $300 to $600.
MORE: Wind damage
WIND: Insurers make use of lots of loopholes.
Homeowners' deductibles typically run $500 to $2,500 -- unless damage is due to a windstorm.
Special wind deductibles were first introduced after Hurricane Andrew in 1992, and they've now been extended to 19 states plus the District of Columbia -- and in some cases to tornadoes and hailstorms.
Instead of a set amount, you can opt for a percentage of your property coverage, typically 2% to 5%. Put another way, for a home insured for $400,000 with a 5% deductible, you'd be out $20,000 before your insurer forks over a dime.
Related: Hurricane deductible could cost homeowners thousands
Stay with a 2% deductible. Upping to 5% will offer only minimal savings on premiums, says agent Billy Wagner of Brightway Insurance in Florida.
Know where you'll get the cash. You need enough cash in reserve to cover the largest deductible you will incur if a windstorm hits. If it would take a while to save that much cash, open a home-equity line of credit to draw on when you need it, says Dallas financial planner Michael Anderson.
REBUILD: Your policy may not pay for an up-to-date dwelling.
Insurance is designed to rebuild the home you have. But especially with older homes, newer, tougher building codes can make an exact replacement impossible unless you pay more than the cost of your original home. Historically a typical policy allotted 10% of your dwelling coverage toward the extra expenses of satisfying modern building codes.
These days policies vary widely, Schwarcz has found. In his analysis, 20 didn't cover the extra costs at all unless you had added a rider on your policy; another eight offered coverage that wouldn't cover the full expense.
Opt for extra coverage for an older home. If your home is less than 10 years old, 10% of dwelling coverage for code updates probably suffices -- verify that your policy includes it.
For older homes, and in disaster-prone areas where codes change more rapidly, upgrade your policy to include 20% for "ordinance and law." Costs depend on location, says Kurt Thoennessen of Ericson Insurance; for a home insured for $400,000, going from 10% to 20% may cost $25 a year in Connecticut but $200 in Florida. The cost also varies widely by carrier; some price it high because they would prefer not to insure older homes, he says.
To help pay for this, you may want to increase your basic deductible. Going from a $500 to a $1,000 deductible will cut your homeowners premium at least 10% (it's not worth making a bunch of small claims anyway; you risk your carrier dropping your coverage).
FLOOD: Coastal dwellers are taking a big risk.
Private insurers long ago stopped covering flood damage, so homeowners have to purchase it through the National Flood Insurance Program.
There are two problems with that. One, many people outside high-risk zones don't have it -- including some who probably should. Two, the federal program maxes out coverage at $250,000 for the dwelling and $100,000 for your personal property, which could easily fall short of the amount needed to rebuild your home.
Flood insurance also has its own restrictions. Among them: It won't replace trees, decks, and pools, or help you fix your finished basement. It won't pay for personal property or for living expenses you incur while your home is uninhabitable. And as homeowners affected by storms Irene and Sandy in the Northeast have discovered, some claims are being denied if even an inch of the first floor is below ground.
Getting stuck with only $250,000 in coverage could happen more often than you imagine. When damage results from both wind and flooding -- as in most big storms -- insurers want proof that they, and not flood insurance, should pay. After Hurricane Katrina reduced thousands of homes to mere slabs, insurers simply denied claims because there was no proof the damage wasn't caused by flood (courts overturned most of those denials).
Pony up for flood coverage if you live near any body of water. Even melted snow can cause a flood, says the Insurance Information Institute. Rates depend on your home's age and location.
Live in a high-risk zone? Though expensive, you may want "excess" flood insurance, sold by only a few insurers. Another $250,000 in dwelling coverage and $100,000 in contents might run about $1,000, says Wagner.
Finally, be realistic. Before deciding to transform your basement into the man cave of your dreams, understand that you'll have to foot the bill for flood damage. Avoid keeping valuable belongings there if you live near the water, or at least plan to remove them before a storm, says the III's Jeanne Salvatore.
Looking to buy a coastal home? Keep in mind that by drastically cutting back coverage or refusing to write policies at all in some highly storm-prone areas, insurers have effectively declared these places too risky to inhabit. Says Salvatore: "Insurance costs are something people really need to think about to begin with when they buy a house."
HOW TO SHOP FOR A POLICY
The myriad ways insurers now offer homeowners insurance makes comparison shopping challenging—but critical. Use the four tips below to help you get the best possible deal.
Get five quotes. Agents may be tempted to quote cheaper policies in their eagerness to land the sale. So talk to three, including at least one who can give you multiple quotes. (Find one at iiaba.net; click on Contact Us.)
Compare. A few state insurance departments, such as Nevada's, post sample policies online; Texas has a policy comparison tool at opic.state.tx.us (click on Compare Policies). Your state's policies will be similar.
Ask the right questions. Your agent should give you a list of all the riders each carrier provides; bundling riders may earn you a discount. Ask how replacement-cost coverage is handled.
Request a sample policy. Many agents will provide them in advance, even though they don't have to. And once you buy, make sure you read the policy. You can always cancel and get a refund.
By Lisa Gibbs, April 12, 2013: 07:09 AM ET
Healthy consumers could see insurance rates double or even triple when they look for individual coverage under the federal health law later this year, while the premiums paid by sicker people are set to become more affordable, according to a WSJ analysis.
Having a car emergency kit in your car is sort of like having good insurance. You hope you'll never need it—but boy are you glad it's there on road trips if you have an accident or need to help others.
If you become stranded, it can be critical to have the right supplies to speed up being rescued, say driver-safety experts. This is especially true in winter weather, when having the right supplies could also mean your survival.
It's easy to be prepared for road trips. Auto emergency kits with most of these essentials cost $30 to $100 at stores that sell auto accessories. But you can also assemble your own car emergency kit. To be ready for any roadside emergency, here's what you should include.
What Belongs in the Trunk
Use a sturdy canvas bag with handles or a plastic bin to store your auto emergency kit, and secure it so it doesn't roll or bounce around when the car is moving. Include the following:
Inventory your items in the winter and spring, and include these six items before the winter months:
Not all emergency equipment should be behind the backseat or in the trunk. Here are three essential items to stow within the driver's reach:
Whether you're headed out on the road for a weekend drive or a longer vacation, there are some car trips we simply wouldn't think of making without including the four-legged member of the family.
Just as you make plans for a safe and comfortable trip for your family and friends, it's a good idea to do the same for your pets to help your travels go smoothly.
Preparing Ahead of Time
While On the Road
Write something about yourself. No need to be fancy, just an overview.