Homeowner’s insurance gives you peace of mind that your personal belongings and property are protected in the event of damage and loss, and is also meant to prepare for those unforeseen accidents and emergencies. It is extremely beneficial to have homeowners insurance to replace personal property and/or defend against a liability suit. For example, if a tree falls on your roof, a fire destroys your kitchen, or a friend injurers himself/herself slipping on your rug, the insurance policy pays for your loss when you file a claim.
How Does Homeowner’s Insurance Work?
Your home insurance can help pay for many costly problems including:
• Damage to the building you live in or to other structures (such as sheds or garages) on your property.
• Improvements you have made, such as appliances or fixtures, that are considered part of your residence.
• Fire or lightning
• Power outage.This benefit is often limited to your personal property coverage amount and may be even lower for items such as spoiled food.
• Wind or hail. Wind and hail are among the most common and costly insurance claims.
• Theft. Your tangible personal property is covered by hour home insurance (liability), but there are limits on reimbursement for money, bank notes, gold, silver and other items.
• Dwelling coverage is based on replacement cost of the home NOT market value. Replacement cost includes the cost to demolish and remove the existing structure.
Be sure you have enough homeowners insurance to rebuild a house of similar quality and/or replace your belongings in the event of a serious disaster. There are different Homeowners Insurance Coverage options.
Common Personal Property Coverage Levels:
• Actual cash value: Replaces possessions at their current value, deducting depreciation for items you have owned for a long time, up to your policy limit.
• Replacement cost: Covers the current cost of replacing your possessions, without any depreciation deduction, up to your policy limit.
• Guaranteed replacement cost: Covers the current cost of replacing your possessions, without any depreciation deduction, up to about 20 percent above your policy limit.
Generally, personal property is covered between 40 and 75 percent of your structure’s rebuilding value.
Home Insurance Add-Ons
Beyond standard homeowner’s coverage, you may consider buying separate insurance for the following:
• Flood insurance is a separate policy that protects against flooding. Most people in Illinois only carry flood insurance if/when the mortgage company requires it.
• Sump Pump/Sewer Back Up coverage protects against water damage due to sump pump failure or sewer back up due to excessive rains. Often, the coverage is a separate rider added to your policy.
• Valuable articles coverage provides additional coverage for your “valuable possessions” such as jewelry, art work, collector items (stamps, coins, guns, etc.). The added coverage allows coverage of the item, such as a ring with no deductible. An appraisal may be required for items over $10,000 value. I highly recommend keeping a receipt or having an appraisal done and kept outside of the home.
Renters and Landlords
Today’s renters may find that they are required to buy renters insurance as a matter of course, and it’s not a bad idea to protect your personal property even if you aren’t responsible for the structure of your dwelling.
• Renters Insurance covers personal possessions and liability. This includes losses due to fire, theft, etc.
• If you are a landlord, require your tenants to carry rental insurance. In doing so, this can protect you (the Landlord) from having to file a claim against your own policy. If the tenant has coverage, the claim will first go through their coverage. A perfect example is dog bite claims. If the renter has insurance the claim will be paid by their insurance company. If they do not, the claim will be paid by the Landlord.
There are so many different factors to consider for a Homeowners Insurance policy and what is best for you, your family and your assets. Contact me to learn more about how to save on your home insurance, list of discounts worth pursuing, including bundling your home and auto insurance.
Tips to Protecting Your Home and Your Possessions
Having an up-to-date home inventory of your valuables will help get your claim settled faster. You can do it the old-fashioned way, with a pen and paper and make a list of all items, or there are now mobile apps that are available that can easily help you create and store records of all of your belongings.
Some inexpensive recommendations are Nest Egg for iOS or Sortly for Android, iOS and web). Some apps also allow you to store images of purchase receipts to record the original value of the item.
When you’re just starting out, it often seems that a dollar never stretches far enough. And with new commitments, such as buying your first home or having children, comes the responsibility to make sure your loved ones will be provided for financially, no matter what life may bring.
If you were to die unexpectedly, life insurance is there to make sure your loved ones can maintain their standard of living, stay in your home, send your kids to the same schools and keep their plans for the future on track. It also gives the grieving spouse or partner time to make decisions, or in some cases find work outside the home, without worrying about finances.
But common misconceptions often prevent young families from purchasing the life insurance they need.
Myth 1: I only need life insurance if I’m the primary breadwinner in my family. Whether you bring home the largest paycheck in your household or a smaller one, your family relies on your income to maintain its quality of life, and it would be missed if something were to happen to you. Even if you don’t work outside of the home, having life insurance is a smart choice. Stay-at-home parents perform valuable services such as childcare, cooking, housecleaning and household management, which can be costly to replace for a surviving spouse or partner.
Stay-at-home parents perform valuable services such as childcare, cooking, housecleaning and household management, which can be costly to replace for a surviving spouse or partner.
Myth 2: If I buy a term life insurance policy and find that I still need protection when the term ends, I can always renew the policy. Term policies are quite popular with many young families, and for good reason: They typically offer the greatest coverage for the lowest cost. Term insurance provides protection for a specific period of time (the “term”), and can be ideal for people who feel they have financial needs to cover that will disappear over time, such as a mortgage or a child’s education.
However, many families realize that even after the kids are grown and the mortgage is paid off, their need for insurance continues—to provide income for a surviving spouse, eliminate debts, pay taxes, etc. Because life insurance premiums increase with age, renewing your policy when the term expires can be very expensive. Moreover, poor health may make renewal impossible.
Myth 3: I only need term life insurance. Term life insurance makes sense for many young families because their need for coverage is great and their budgets are often limited. But that doesn’t mean it’s the only type of insurance you should consider.
Permanent life insurance policies provide a death benefit as well as other unique features such as lifelong protection and the ability to accumulate cash values on a tax-deferred basis, similar to assets in most retirement-savings plans. You can access the cash values for important uses like a child’s education or a business opportunity. (Keep in mind, however, that withdrawing or borrowing funds from your policy will reduce its cash value and death benefit if not repaid.)
If any of this sounds daunting, just know that it does’t have to be. You can start by doing a quick calculation on your own to see if you need life insurance with this Life Insurance Needs Calculator (or just click on “What’s Next” below). And just know that you can also talk things through with Kelly Burk Insurance at no cost. We will help you figure out how much you may need, and also find a policy that fits into your budget.
2017. A Year of Challenges and Great Rewards!
The year started with me barely making it through the day at 8 months pregnant. At that time, the days were pure torture. I could not get comfortable in any position…sitting or standing. On February 7th a new kind of challenge was introduced with the birth of my 3rd child. Jameson completed our family with 2 girls and 1 boy, however this also meant an extended maternity leave.
I was off February 5th-May 1st; returning on a part-time basis and adjusting to the demands of family and work. Sadly, once I came back full time, it was time to say goodbye to my assistant of 2 years, Amber. Amber decided to go back to school on a full-time basis and felt it was too difficult to balance the demands of Open Enrollment and school. Naturally, I agreed as Open Enrollment is a very demanding time of year.
On a positive note, this also allowed me the opportunity to find a new candidate to fill her spot. I welcomed Patti to the agency in October and immediately threw her into Open Enrollment with little training. Patti has been FABULOUS. She’s eager to learn and great at figuring things out on her own.
2018. New Beginnings!
To provide better options and to better serve you, we will be researching and training with each of our carriers to learn about best business practices and offerings. Patti will be contacting you to discuss these findings and changes. In addition, we will also be working on rounding out our accounts. Although it is not discussed during Open Enrollment, I provide a vast network of carriers that offer GREAT rates on home and auto insurance. Patti will be calling and emailing you to gauge interest on receiving home/auto insurance quotes.
As for me, I will be catching up on paperwork. Sadly, I’ve gotten behind on reviewing renewals. Don’t be surprised if you receive a call from me in the next couple of weeks discussing options to reduce your existing home/auto insurance rates.
I’ve also made the decision to take a step back from some of my networking obligations, and focus more on my business and family. Although it has been a rewarding 8 years with the Dynamic Professional Women’s Network, I will no longer be a member or Chapter Director. I will still provide some assistance to the Tinley Park Chamber of Commerce. My 3-year term as Treasurer will be up the end of this year.
Finally, I will continue my passion for fitness by training for a marathon this year. Although this is not my first marathon, it is my year to make a comeback as I am officially DONE having babies.
Thank you for being such a valued client. I look forward to working with you more in 2018.
On October 12th, President Trump signed an Executive Order, forcing changes to be made toward some of the rules of small business health insurance plans, short-term health insurance policies, and cost-sharing reduction payments (aka subsidies).
What does the Executive Order mean
- Broader rules for AHP’s (Association Health Plans), allowing small businesses to purchase plans across state lines. By joining an AHP, small employers within the same line of business could purchase plans collectively.
- Increase the policy period on short-term plans from 3 months to 12 months with the option to renew. These plans are not required to follow the rules of the ACA mandate (i.e. they do NOT provide coverage for pre-existing conditions)
- Cost-sharing reduction payments (aka subsidies) will no longer be funded by the government. Insurers are required by law to offer assistance to low-income individuals. Customers who are currently receiving assistance through the Marketplace will likely see little change.
- Rates have not been released and likely will not be released until November 1st. This means renewals will not be available until November 1st.
How to Avoid Rate Increases:
- Be prepared to discuss your household, estimated adjusted gross income for 2018. This will be used to determine if you qualify for assistance.
- Those without pre-existing conditions should consider temporary insurance. The premium is much lower and all plans offer a PPO network. Wellness visits are not included with these plans.
- If you are going to opt to self-insure, protect yourself with an accident or critical illness plan. The plan works separate from health insurance and pays you based on a diagnosis of a critical illness (cancer, heart attack, or stroke) and in the event of an accident (slip, fall, and break an ankle) the plan will pay you a certain dollar amount. The purpose is to use the funds to pay towards the unexpected hospital or urgent care visit.
- Review ALL of your insurance policies. As a broker I have access to multiple carriers which allows me the opportunity to find the best plan based on your needs. I’ve saved people thousands by reviewing rates with multiple carriers. Personal lines insurance (auto, home, life, and health) is my area of expertise!
Homes often grow and change alongside the people living in them. If you’ve added expensive furnishings or made substantial upgrades, it’s important to re-evaluate your homeowners insurance and make sure your policy reflects those changes. Here are four instances when it may be beneficial to review and adjust your coverage.
Remodeling or Renovation Work Home improvement projects typically increase the value of your home, which usually calls for more coverage. But that doesn’t necessarily mean your insurance rates will automatically increase. In fact, some projects, like adding a new roof, may help you save on your monthly home insurance premiums. Just be sure to notify your provider before any work begins.
Adding a Pool or an Outdoor Trampoline Because these fun home features come with increased risk of injury, they’re labeled an attractive nuisance. Upping your liability insurance can help keep you protected if there’s ever an accident on your property and a subsequent lawsuit.
Acquiring New Valuables Whether you inherit them or purchase them, expensive goods such as jewelry, art, rugs and antiques should be added to your policy. Increasing your coverage is the only way to safeguard them in the event of damage or theft.
Starting a Home Business Many home-based business owners don’t realize they have little, if any, coverage from a homeowners or renters insurance policy. Since a new home business likely means purchasing new technology and expensive equipment, you may need to get additional protection.
You worked hard for your home. Secure your belongings by updating your coverage to match your circumstances.