A FREE analysis tool for you to find out if you have the right amount of coverage
My FREE gift to you!
Weekly I sit with businesses as we analyze their commercial business insurance. The goal is to make sure they understand what insurance they have, what insurance they might need, and we find the best rate possible.
I have discovered when meeting with families they sometimes do not understand their own insurance. It has never been explained to them so they might not know what they need or want. We should treat personal insurance like business insurance to make it work for us. I have created an analysis tool for you to use ABSOLUTELY FREE!
FREE Insurance Analysis Tool
On the sample image here we have a sample Declarations page or Dec page as it is called, for home insurance. This is the page that will spell out and declare the coverages by the insurance company.
The top will have basic information like the agent, the policy number, the policy period, the address to be insured, and eventually you get the premium that will be paid for this insurance.
Now we get into a section called liability coverages for the property or the limits.
A.) The dwelling- the property. Your home. This is the amount of money the insurance company feels that is needed to rebuild and clear the land if there was a catastrophy. If you have been with your insurance company a long time, this number might not have grown enough to keep up with current values and costs.
B.) Other structures- look around your home outside. Do you have a patio, a deck, a fence, a shed, a hot tub, dog house, barn, detached garage, etc? Would this amount be enough to rebuild or replace those items?
C.) Personal property- pretty self explanatory, but use this example when you think about it. Pick up your house and shake it. Whatever falls out on the ground, this is personal property. Does this value equal enough to replace those items?
D.) Additional living expenses- if a fire or storm destroyed your home and you needed to live somewhere while it was rebuilt. Could you rent a place for a year or two for this amount?
E.) Personal liability- someone gets hurt on your property, they sue you or their insurance sues you. Is this enough based on what the judge says they can sue you for? Most policies are $300,000 or $500,000. But did you know you could easily have $1.3 million or $1.5 million for hardly any money? On average you could spend $10-$65 a month an add a $1 Million dollar umbrella policy to guarantee you have enough coverage against the judgement.
F.) Medical payments- this is to the person hurt on your property, not for you. With options like $1,000, $5,000, $10,000, $15,000 etc. Look at your policy and ask yourself if you have enough. With rising medical deductibles being $8,000 or $12,000 can you imagine if you only had $1,000 coverage?
Deductibles: $1,000 or $2,000 is the average, but $2,500- $5,000 is becoming increasingly more common to reduce rates.
Wind and Hail could also be a %. Your policy could say 1% or 2%, which in our example above could be $3,457 or $6,915. You can request to set it at a dollar amount like $2,500 instead.
Coverages that Apply:
This last section is to spell out any additional things covered or maybe excluded in your coverages.
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Personal Property- Full replacement cost or used value?
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Water backup- what if your toilet or drain or sump pump backed up. How much would they pay for water damage to items?
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Identity theft- Will they pay for all the costs to repair the damages?
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Increased cost endorsement- Our example of 25% of the dwelling, means that if it took more that quoted in coverage A. for the dwelling they will pay an additional 25% increasing the amount your home is insured for.
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Ordinance or law- Could be that your home needs to be brought up to new building codes after destruction, things change. The insurance company will pay the increased amount stated. Our example here is 10%. Also HOA fees continue to come in so they would be covered in this section.
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Mold, wet, rot- pretty easy to understand. It takes extra work to get rid of mold.
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Equipment breakdown- If your home was struck by lightning or a reason other than wear and tear. The equipment would be replaced such as the furnace, air conditioner, fridge, etc.
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Service line- Did you know if your water/sewer pipes between your home and the connection to the water company busted you are the one to pay for it. That means digging up your yard and running new water or sewer lines to your home. Service line coverage is what would pay for that instead of you paying out of pocket.
On the right we have a sample of a Dec page of an auto insurance policy. This will breakdown the coverages you have on yourself or vehicle. The top will have basic information about the agency or the insurance company. There will be a section with the policy number, the date the policy renews.
Your information such as mailing address will be displayed.
There will be a section about the premium, now some insurance companies will have the premium or period of insuring for 6 months or 12 months. You can pay your premium in many ways such as monthly, quarterly, 6 months, or 12 months.
Now we get to the vehicle being insured. The vehicle or vehicles will be listed with the vehicle's VIN number. You will want to keep an eye on this section as we move into coverages. Deductibles and other specifics can be different from vehicle to vehicle. They are not required to match, such as some people have liability on one vehicle and full coverage on another. Many times a client will have $500 deductible on one car and $1,000 on another car. For the most part it's common for the coverages to match on all your vehilcles.
A) If you were to cause bodily injury this policy would payout $100k per person until the $300K max is reached. If 4 people are hurt and the first 3 get $100K the 4th person gets nothing. Now they can go after you for money, which is why having an umbrella policy for $1 million or increasing your coverage to $500K might be smart.
B) Property damage is at $100K in this policy. If you hit a home or a couple cars, is $100K enough? Some people will notice in their policy they only have $50K coverage here. Others will have $250K or $500K. Try and think of what cars cost these days or home damage or light poles. You could easily out do your coverage here. Hitting a $60K Tesla and a $80K Suburban, you have easily maxed out coverage and owe out of pocket. Personally I have witnessed a person with $50K coverage hit a $150K sports car. The person with the sports car refused to turn it into their insurance and bankrupted the young lady with $50K coverage. Umbrella policy would kick in here or having enough coverage.
C) I won't spend too much time here but this is the coverage if someone doesn't have enough coverage or no insurance for the damage to you. If you have $75K in a hospital bill and they have $25K your insurance kicks in.
D) This is if the person with no insurance does damage to your vehicle or property. In this policy we are looking at a $100K would cover most average vehicles, but is it enough to cover your vehicle and possible property? Maybe you have $50K, is that enough? Also some policies have a deductible and some policies have no deductible here.
E) Medical payments. This is normally to help cover the person's deductible. With today's high deductibles a $1,000 might not cover enough or even $5,000.
F) Comprehensive Deductible. Things not involving a collision. These are more things considered "act of God or nature." Hail, animals, etc.
G) Collision Deductible. Here we have what you would pay if you are in an accident that is your fault.
H) Rental coverage if your car is in the repair shop from some type of accident. There will be a dollar figure they pay each day and a max dollar figure. If your car is in the shop for 14 days and you have about 10 days worth of rental coverage. You are paying the extra 4 days. In some situations clients might have $25 a day/max $1,000. But if the rental company only has vehicles as low as $35, the client would owe $10 a day. Make sure you have enough each day and a max long enough to cover 10 days.
I) Towing. If you do not have a roadside coverage club like AAA or another version. Your insurance policy can have towing coverage. You can pick an amount of money such as $200 or $400 for towing if you were to need it. This can pay even if you are just broken down and not in an accident.
There are a ton of discounts with auto policies, way more than homeowners policies. Ask to see a list so you can make sure you get all the discounts you qualify for.
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Deductibles used to be $100 in the 70s or 80s. In the 90s it became more common to have deductibles of $500 to keep insurance premiums down. Today it is more common to see deductibles of $1,000-2,000 as vehicle costs have increased. Some insurance companies do not even offer deductibles below $1,000.
My advise... Pick a deductible you feel you could comfortably get your hands on if you had an accident. Don't go any lower because you could be wasting money on higher premiums.
Umbrella Policy:
This is an additional policy that acts like an umbrella over your home and auto. You can customize the amount like $1 Million, $5 Million, etc. If you have $300K liability on your home but someone falls and sues you. You actually have $1.3 Million worth of coverage. If you were to hit 3 cars and slide into a business in an auto accident your $100K per person/ $300K max would become $1.3 Million max. If 8 people were hurt all 8 people would be able to get $100K because you now have $1.3 Million Max instead of $300K max.
COST: They can range from $120 a year to $600 a year on average. Each company is different, but for $15-50 a month what a great safety net.
