You’ve Got Questions. We’ve Got Answers.
We’ve listed some of the most commons we are faced with below, but we believe every circumstance is unique and as a client of ours we love to give personal insurance advice based on your unique circumstances and insurance needs. Please feel free to call us and learn more about how we can help provide guidance and clarity.
Personal Insurance FAQs
Business Insurance FAQs
- Business Property FAQs
- Business Auto FAQs
- Workers Compensation FAQs
- Professional Liability (E&O) FAQs
- Employment Practices Liability (EPLI) FAQs
Q: What are the benefits of purchasing insurance through an independent agent?
A: An independent agent offers personal service that is hard to come by these days. An agent will shop your insurance policies with multiple top rated insurance carriers to find the best coverages at the lowest price. Plus, in the event of a claim, it’s nice to hear a familiar voice on the other line who you know will go to bat for you, instead of being introduced to someone you’ve never met before in a time of crisis.
Q: Why should I include Uninsured Motorist coverage in my Auto policy?
A: The obvious answer here is that Uninsured Motorist coverage will pay for damage you suffer if you are hit by someone without auto insurance. But did you know that it will also pay if you are the victim of a hit and run? You’d like to think that anyone who hit you would stop, but at least with Uninsured Motorist coverage, if they don’t, you can still recover money for the damage caused.
Q: What’s the difference between Collision and Comprehensive Physical Damage coverages on an Auto policy?
A: Collision coverage will pay for a loss to your car if it collides with another car or object. This will pick up your repair shop bill after an accident. Comprehensive coverage will pay for a loss to your car for things other than collision. This includes theft, fire, explosions and even cracked windshields (Dang dump trucks on the highway!).
Q: What factors can affect the cost of my Auto insurance?
A: Here’s a brief list:
- Your age
- Type of car you drive
- Your driving record
- Where your car is garaged
- Your marital status
- The purpose your car serves
Q: What’s the difference between Actual Cash Value and Replacement Cost?
A: Let’s use an analogy: If your 10-year-old home were like a BMW and it suffered a total loss, an Actual Cash Value policy would replace it with something like a Honda Civic, whereas Replacement Cost would give you a brand new BMW. Actual Cash Value is a form of insurance that pays damages equal to the replacement cost of damaged property minus depreciation. Replacement Cost is insurance that pays the dollar amount needed to replace your damaged property without deducting for depreciation, up to the maximum insurance limit on your policy.
Q: Is my personal property covered when I travel with it?
A: A resounding Yes! Personal property (except property that is specifically excluded) is typically covered anywhere in the world. So that new iPad or iPod or iWhatever that accidentally got crushed underfoot while running with the bulls in Spain is covered. Heck, even if the Persian rug you purchased while in Turkey get’s snagged and unraveled in the airport escalator, you’re covered. Even if it hasn’t made it to your home yet, its still covered.
Q: Does my Homeowners insurance policy cover flood?
A: No! No!…and No! Sadly, many people have suffered enormous losses to their personal property because they thought it was included in their Homeowners Policy. Whether you’re in a high risk flood zone or not, it’s a good idea to have flood insurance.
- Floods and Flash Floods can happen anytime and anywhere.
- Federal assistance may not be enough to cover damage cause by a flood.
- Flood insurance may be more affordable than you think.
Flood insurance isn’t just for property owners living along the coast. Recently, even North Georgia and Tennessee saw historic flooding in unlikely places.
Q: Doesn’t my landlord’s insurance cover me?
A: No! Your landlord may have coverage that protects the building you live in, but not your belongings. If someone breaks into your apartment and steals your stuff, you’re out of luck, Chuck. That is, unless you have renters insurance.
A typical Renters Insurance policy includes coverage for:
- Fire, theft or vandalism of your personal belongings
- Items like laptops or bikes, wherever you take them
- Increased cost of another place to live if your apartment becomes uninhabitable
- Injury you cause to another person
- Damage you cause to another person’s property
Not bad, especially for a policy that costs less than you probably think.
Q: What if I have a roommate? Do we need separate renters policies?
A: A typical renters policy covers only you and relatives that live with you. So unless you’re married to your roommate or you carpool to family reunions together, you both need to have your own renters policy. This way, you’ll each cover your own property and your own actions (You party animals, you!).
Q: What is a personal Umbrella policy?
A: You fall asleep at the wheel and have a head-on collision with another vehicle injuring several people. It reminds you of the good ol’ days when you see all the neighborhood kids play in the oak tree in your front yard (Johnny, look out!). These are situations in which injured parties may sue you for more money than your Auto or Homeowners Insurance covers. A Personal Umbrella policy picks up where your other insurance policy limits leave off. It creates an “umbrella” over all of your other personal liability policies (home, auto, boat, RV, etc.).
A typical Personal Umbrella policy includes:
- Payment for medical expenses of the injured party
- Payment for property damage caused by you
- Legal defense costs
- Worldwide coverage
Q: How much Life insurance do I need?
A: According to many experts, the best way to decide how much insurance you need is by performing a “needs analysis”. This isn’t as complicated as it sounds and while it will take you longer than multiplying your salary by seven, it’ll give you a much more accurate result.
Step One: Short-term Expenses
These fall into three categories—expenses that would need to be paid if you died (including medical, funeral, and legal expenses), your outstanding debts, and emergency expenses (such as for emergency medical treatment or unexpected car repairs).
Step Two: Long-term Expenses
Your long-term expenses include the balance on your mortgage and college tuition for your children. If your kids aren’t yet at college age, estimate their tuition costs by finding out current annual education costs. Then add five percent per year for each year until they attend college.
Step Three: Day-to-Day Expenses
These are the expenses involved in family upkeep, such as food, utilities, entertainment, travel, and clothing. Calculate one year’s worth of expenses, then multiply that figure by the number of years you want your insurance to provide this level of income.
Step Four: Financial Resources
Next, determine what resources you currently have to meet those expenses. This includes your current salary, savings, investments and any existing insurance you have, as well as Social Security. Do not include the sale of any assets that would change your family’s lifestyle if they were sold, such as your home.
Step Five: Add it Up
Add your totals from steps one to three. Then subtract your resources calculated in step four from your expenses total. The figure you end up with is a good estimate of the amount of life insurance you need.
Don’t be discouraged if you end up with a much higher figure than you were expecting, or can afford. If this happens, run through your calculations again and try to find ways to cut expenses. For example, by paying debts early you can reduce your short-term expenses.
Because your insurance needs will change over the course of your life, experts recommend that you review your insurance every three years to ensure that you’re adequately covered.
Q: What is the difference between Term and Whole Life Insurance?
A: Term Life Insurance
- Pays a death benefit if death occurs during a set term of your life (ex: 20 yrs, 30 yrs)
- Lower premiums for more coverage
- Rates can change after each term expires
Whole Life Insurance
- Generally covers you for your entire life
- Can build equity and have a cash value
- Higher premiums, but can accrue more value as time goes on
Q: Should my spouse and I both purchase Life insurance?
A: It depends. If you are both working jobs to provide income for your family, yes. In this case, if your spouse dies, assuming you share your income, you would now have to make up for their portion of it in order to maintain your lifestyle.
If your spouse stays home with the kids and does not provide monetary income for your family, Life insurance for both of you is still a good idea. If your spouse dies, who will take care of the kids and provide the household services that they used to take care of? Would you need to begin paying for daycare or a nanny so that you can continue to go to work?
Even if you do purchase Life insurance for your non-wage-earning spouse, it is critical that you purchase it for yourself in the event of your own death.
Q: Are business computers covered on a Commercial Property policy?
A: Typically, yes. However, you may want to insure them separately on a computer schedule which provides broader coverage. On a computer schedule, you’ll have coverage for things like power surges and loss of data that your Property policy by itself won’t cover.
Q: What is Business Interruption insurance?
A: A Commercial Property policy will pay to repair or rebuild your building after a covered loss occurs, but how will you keep your business afloat while repairs are being made? Rebuilding after a complete loss can take months. That’s where Business Interruption coverage comes in.
A Business Interruption policy is like short-term disability coverage for your business property. It reimburses you for lost revenues and profits while repairs are being made to your building. And, just because your building is damaged, doesn’t mean you’re allowed to stop paying your bills. That’s why Business Interruption also pays for your continuing expenses.
You can also purchase Extra Expense coverage that will pay for things like a temporary location for your business operations and advertising costs to get the word out that your business has a new home for the time being. This is especially important for businesses that are heavily dependent on their location like grocery stores, restaurants or warehouse operations.
Q: Does Business Auto insurance cover my employees while driving their own cars on the job?
A: Not automatically. Ask your agent to include Hired & Non-Owned coverage on your Commercial Auto policy. This will provide your business with auto liability coverage for vehicles it does not own but that your employees use in the course of business. So, your outside sales team and the person who drives to pick up the mail every day will have liability coverage in the event of an accident. Hired vehicles, or rental cars will also be covered as part of the Hired & Non-Owned auto liability.
**Liability is the key word here! This coverage will only pay for damage to a third party that was caused by an employee driving their own car or a rental car for work. That’s why it’s important to make sure your employees have their own personal auto insurance to cover damage to their own car. When renting a car, you may want to purchase the extra collision coverage that will cover damage to the rental car itself.**
Q: If Workers Compensation premium is based on annual payroll estimates, what happens if my best guess is wrong?
A: In the course of a year, it’s natural for businesses to hire or terminate employees, as well as adjust existing staff salaries. That’s why Workers Compensation policies are subject to a final audit at the end of the year to adjust for payroll changes. So, if you overestimate your payroll at the beginning of your policy term, you could get money back from your insurance carrier sometime after your policy’s renewal date. On the other hand, if you underestimate payroll at the beginning, you’ll owe extra premium after your final audit determines that your payrolls increased.
Some new business owners think they’ll save money on their Workers Compensation policy by intentionally underestimating their payrolls at the beginning of their policy term. If their agent didn’t discuss the audit process with them, they are typically in for a shock when they have to pony up the extra premium after their policy’s renewal. With Workers Compensation, it’s either pay now or pay later. Don’t be fooled that there isn’t a later waiting down the road!
Q: Aren’t my professional services covered under my General Liability policy?
A: No! Professional Liability, sometimes called Errors & Ommissions insurance (E&O), covers the mistakes your company is accused of making in relation to the services you provide.
Some examples of the need for Professional Liability insurance include:
- A printing company fails to complete an order of programs in time for opening night at the local theater.
- An architect’s miscalculation causes his clients to pay their builder extra money in order to start over on the front staircase of their new luxury home.
- A website development company misrepresents what they’re capable of producing in order to land a big client, only to find themselves taking shortcuts and delivering an inferior product.
Unlike a General Liability policy which responds mainly to bodily injury or property damage your company causes, Professional Liability insurance provides coverage for claims that allege:
- Violation of good faith
- Inaccurate advice
- Failure to provide services
If you provide services for clients on a fee basis, you have a Professional Liability exposure that needs to be covered.
Q: Can I buy insurance to cover lawsuits filed by employees against my company?
A: Yes. More than ever, employees, former employees and even prospective employees are bringing lawsuits against companies alleging Harassment, Discrimination or Wrongful Termination.
Employment Practices Liability Insurance (EPLI) provides legal defense costs whether your company wins or loses in court. EPLI coverage will also pay for judgments and settlements as long as they are non-punitive.
A typical EPLI policy includes coverage for lawsuits alleging:
- Sexual Harassment
- Discrimination (age, sex, race, disability)
- Wrongful Termination
- Breach of Employment Contract
- Failure to Employ or Promote
- Mismanagement of Employee Benefit Plans