Flood Coverage and Car Insurance

Posted by on Sep 6, 2017 in Blog | Comments Off on Flood Coverage and Car Insurance

Flood Coverage and Car Insurance

Hurricane Harvey made landfall in Corpus Christi nearly two weeks ago then moved eastward along the Texas coast where it stalled over Houston for several days before moving on to Louisiana and off to the northeast. A one-thousand-year flood resulted from the trillions of gallons of water that fell along the Texas coast, enough to depress the earth’s crust by 2 centimeters. The estimate on the number of cars destroyed by Harvey ranges between 500,000 and 1,000,000. Let’s examine what kind of car insurance covers your car from flood damage.

Comprehensive, or other than collision coverage, protects against a variety of loss types including flooding, fire, falling objects, hail damage, damage from high winds (hurricane, tornado, etc.) and even if you hit an animal that wanders onto the road such as a deer, cow, horse, etc. Examining your car insurance declarations page should confirm if you have comprehensive. This page shows the type of coverage you have, the policy limits, and your policy deductibles.  Comprehensive is usually listed either before or after the collision coverage.

The number shown for each vehicle corresponds to the amount of the comprehensive deductible such as $100, $250, $500, etc.  There should be a deductible amount listed for each vehicle on your policy which confirms coverage is in place.  If one vehicle lists a deductible, but the another one doesn’t, you need to confirm if the coverage is for only one or all vehicles with your agent.

Comprehensive car insurance applies whether your car was parked when it became flooded or you accidentally drove into water which turned out to be deeper than you thought it was.  Driving purposely into high water, though, would be considered insurance fraud and result in your claim being denied.

The claim adjuster will determine if the car is a total loss from the water.  A car trapped in fresh water may be repairable, if not fully submerged, but this ultimately depends on the cost to repair your vehicle versus the depreciated value of your car. For many carriers, if the cost to repair your vehicle exceeds 80% of the vehicle’s value, it will be considered a total loss.

Car buyers should pull the Carfax report on any used vehicles they are considering over the next 12 months to determine if it’s a car which was salvaged from Hurricane Harvey.  Even if it looks great, there can be issues with the engine, electrical system and even mold from the car’s interior. In addition, many carriers will not write a car insurance policy on a vehicle with a salvaged title!

What do you think?  Share your thoughts, experiences, and car insurance questions with me on my Facebook, Google +, and LinkedIn pages.  I’d love to hear from you!

Thanks!

Ed Wise

Wise Insurance Group

A Third Hurricane Related Home Insurance Claim

Posted by on Sep 4, 2017 in Blog | Comments Off on A Third Hurricane Related Home Insurance Claim

A Third Hurricane Related Home Insurance Claim

Last week I wrote about the two types of hurricane related claims, wind and storm surge, which is related to flooding (see http://wiseinsurancegroup.com/two-types-insurance-claims-hurricane-harvey/). A conversation I had with a client reminded me of a third type of home insurance claim, wind driven rain, which can cause significant damage to the interior of your home.

Wind driven rain damage came up in a conversation with a client as we discussed their flood claim. They were staying with friends in their home when it eventually flooded. She mentioned the sheetrock in the ceiling of a couple of rooms was sagging and falling allowing wet insulation to drop into the home. This damage was not caused by the floodwaters entering the home but by wind driven rain.

Wind driven rain occurs when the wind is fast enough to drive the rain sideways. It has enough force behind it to push the rain through small cracks in brick, siding, around windows, doors, and even under shingles. If it lasts long enough, hurricane winds can force literally gallons of water into the home through these small cracks resulting in damage to sheetrock, insulation, cabinetry, flooring, etc.

What’s important about the difference between a flood claim and a wind driven rain claim is the policy which covers it. No home insurance policy covers a flood claim, that requires a flood policy. However, many home insurance policies do cover damage from wind driven rain. This means damage from wind driven rain can be claimed on the home insurance policy, provided it covers it.

I advised my client to encourage their friends to take pictures of the damaged sheetrock and insulation and feel the sheetrock on all exterior walls for dampness. I also suggested they go into the attic and examine all the insulation to determine how much was wet and may need to be replaced. Wet insulation should be removed and rafters and beams allowed to dry before adding new insulation so as not to cause to mold growth within the home. Drying wood beams and rafters may take two to four weeks or longer depending on humidity levels, airflow, and more.

The best way to determine if your home insurance policy provides coverage for wind driven rain is to ask your agent. If you have a question, comment, or experience to share, then please share them with me on my Facebook, Google +, or LinkedIn page. I’d love to hear from you!

Thanks!

Ed Wise

Wise Insurance Group

Returning Home After the Harvey Leaves

Posted by on Aug 30, 2017 in Blog | Comments Off on Returning Home After the Harvey Leaves

Returning Home After the Harvey Leaves

The sun peeked out Wednesday afternoon for a few minutes over west Houston reminding everyone briefly that it still is there. This was followed by heavy rains stretching from Houston to almost New Orleans as Tropical Storm Harvey moved back onshore and headed in a northeasterly direction. The end of the rain may be in sight but it will take weeks or months before all the floodwaters in Houston and elsewhere recede and dry ground reappears.

Homeowners whose homes have been flooded, will be anxious to review the damage as quickly as possible. Here are some guidelines from FEMA I believe is important to share.

  • The floodwater in and around your home is likely polluted and may contain raw sewage, mold, oil, gasoline, and other pollutants. Wear rubber boots or waders when walking through the water to avoid exposure.
  • Wear rubber boots, gloves, and goggles during cleanup of your home.
  • Turn off electricity and gas to avoid risk of fire, shock, or electrocution.
  • Have a licensed electrician check the house before turning power on.
  • If you have flood insurance, photograph all damage before you demo anything to help with claim processing.
  • Contact your insurance agent as soon as possible.

I’ve had several discussions with flood victims, and here’s what I’ve recommended they do once the water has receded from their home.

  • Remove all carpet and padding and throw them away due to the contaminants in the water.
  • Clean all tile, vinyl, hardwoods, and laminate flooring with bleach water.
  • Watch for cupping or warping on any natural wood flooring. If tiles “pop” or vinyl lifts you may have water underneath it which may require the floor covering be removed so the slab can be cleaned and dried.
  • Sheetrock acts as a sponge and floodwater will “climb” up walls as it soaks into it. Find the dry area above the water line, about 2 to 6 inches above the waterline, and remove it. Dispose of it like the carpet and padding.
  • Be careful removing sheetrock around wiring and plumbing in the walls.
  • Remove all wet insulation from exterior walls. Like carpet, it will need to be replaced.
  • Remove baseboards and wipe down with bleach water to clean them and allow them to dry for at least a week before attempting to reuse them. If they warp, replace them with new baseboards.
  • Wipe down all cabinetry with bleach water to clean them.
  • Before attempting to use any appliance (stove, refrigerator, dish washer, washer, dryer, etc.) have it checked by a licensed technician to see if it’s safe to operate.
  • Don’t be in a hurry to hang new sheetrock. The studs need to be treated with bleach water to prevent mold from occurring and allowed to completely dry.

As damaged items are removed from the home, FEMA suggests separating the debris into six categories when you put them curbside.

  • Electronics – TV, computer, stereo, etc.
  • Large appliances – ovens, refrigerators, freezers, etc. (secure the doors to keep children out.
  • Hazardous waste – oil, batteries, paint, etc.
  • Vegetative debris – trees, limbs, plants, etc.
  • Construction debris – drywall, lumber, carpet, padding, etc.
  • Household garbage

Check with local city laws to confirm the above FEMA recommendations are compliant.

Lastly, be wary of hiring anyone to do demo or repair work who knocks on your door. Hire local professionals who have an office. They’ll be around long to help make things right while the out of state person may not be. Have a suggestion, question, or experience you’d like to share? Please share them on my Facebook, Google +, or LinkedIn page. I’d love to hear from you!

Thanks!

Ed Wise

Wise Insurance Group

The Two Types of Insurance Claims from Hurricane Harvey

Posted by on Aug 28, 2017 in Blog | Comments Off on The Two Types of Insurance Claims from Hurricane Harvey

The Two Types of Insurance Claims from Hurricane Harvey

Hurricane, now Tropical Storm, Harvey isn’t done with Texas. It appears it will move away from Houston in the next few days but not before leaving Houston with up to another 18 inches of rain bringing the prospective total to about 50 inches. The winds whipped Corpus Christi, Rockport, and Port Aransas topping out somewhere between 130 and 140 miles per hour. Adding to the destruction was the storm surge which was 6 feet above normally dry ground in Port Lavaca for a whopping 7 hours.

The damage from the storm isn’t over either, due to the flooding and ongoing rain in Houston. This will only worsen in the next few days or week as the Corps of Engineers releases water from the Addicks and Barker reservoirs. Several groups have published early damage estimates ranging from $30 to $100 billion to Texas coastal communities. These estimates include the economic impact from people not working to insurance claims, to damage not covered by insurance. The real numbers, however, won’t be known for several months.

There are two types of insurance claims caused by Hurricane Harvey, hurricane or wind claims and flood claims. Let’s examine both in detail and what policies cover each type.

Hurricane Claims: Hurricanes can cause three types of damage; wind, storm surge, and heavy rains. Home insurance, or separate wind insurance from the Texas Windstorm Insurance Association (TWIA), provides coverage for damage resulting from hurricane force winds or tornadoes spawned by the hurricane. If your home or business suffered wind damage, file your claim with your insurance carrier or TWIA. Cover what you can with tarps to prevent further damage until repairs can be made. Keep copies of all receipts as damage prevention measures are covered by most carriers.

Flood Claims: Storm surge and flooding due to rising water is not covered by home or renter’s insurance policy. Only flood insurance covers damage to your home and/or contents from storm surge or rising floodwaters. Hurricane Harvey reminds us why having flood insurance is so important, even in non-mandatory flood zones. Most people who suffer flood damage don’t have flood insurance. If you have water in your home and have flood insurance, please initiate a flood claim, even if you can’t get to your home.

There is some good news for people without flood insurance. They may qualify for Federal Disaster Assistance. President Trump has agreed to Governor Abbott’s request for many south Texas counties to be officially named as natural disaster areas. This begins the process for Federal Disaster Relief to be made available to victims of the storm.

The next step is for Congress to provide an amount of funds which will be available to Texans in need. It may take days or a few weeks, but I believe Congress will move quickly to provide an initial amount of relief funds. Once that’s done, the process to apply for relief funds will be announced and probably handled by FEMA. If history is repeated, people without flood insurance, as well as those with, may apply for assistance. Keep in mind, these are usually handled as loans, not insurance payments or gifts.

On Thursday, I’ll write about filing a flood insurance claim and steps to take when returning home after floodwaters have receded. If you found this information helpful, share it with someone impacted by the storm. If you have questions, comments, or experiences to share, please post them on my Facebook, Google +, and LinkedIn pages. I’d love to hear from you!

Thanks!

Ed Wise

Wise Insurance Group

Home Insurance Option: Equipment Breakdown Coverage

Posted by on Aug 15, 2017 in Blog | Comments Off on Home Insurance Option: Equipment Breakdown Coverage

Home Insurance Option: Equipment Breakdown Coverage

I am occasionally asked by a new or existing client whether their home insurance policy covers an air conditioning compressor or water heater that’s going bad. In most cases, the answer is no, unless it’s caused by an event justifying a claim such as a lightning strike, a tree limb that fell on it, etc. Two home insurance carriers offer a coverage option worth considering for their policy holders called Equipment Breakdown coverage and it may provide an attractive option worth adding to your policy.

Equipment breakdown coverage from both home insurance companies offers some very attractive coverage including:

  • Repair or replace a major home system such as the central heating and cooling system, swimming pool systems, ventilation, emergency generators, well pumps, air and water filtration, chair lifts and elevators, home entertainment systems and computer equipment.
  • One of the companies extends this coverage to include appliances.
  • One even includes coverage for additional living expenses if the home becomes uninhabitable due to the equipment breakdown.
  • Both offer to replace the failed equipment with greener replacement by paying to replace a non-Energy Star device with Energy Star rated equipment.
  • One won’t surcharge the renewal rate if such a claim is filed and paid.

Where these two home insurance companies differ is in the cause of the equipment failure that may trigger a claim.

  • One company excludes equipment breakdown coverage due to normal wear and tear. It requires a triggering event that is sudden, direct, and accidental such as a broken part or electrical arcing.
  • The other covers a sudden, direct, and accidental failure and goes on to cover failure due to human error such as an improper installation of the unit and improper operation and maintenance of the equipment by the homeowner.

The cost to add this option to either equipment is very affordable depending on the amount of coverage and deductible selected. It can range from $24 to $100 a year which is much less than most home warranties. The biggest difference is the home warranty is designed to cover normal wear and tear.

Equipment breakdown coverage is a fairly new option. Given the competitive nature of home insurance, I expect most companies will provide it within the next couple of years. If offered, would you choose to add it to your policy? Share your “decision” along with your thoughts, questions, and experiences with me on my Facebook, Google +, and LinkedIn pages. I’d love to hear from you!

Thanks!

Ed Wise

Wise Insurance Group

Car Insurance Topics for College Students

Posted by on Aug 9, 2017 in Blog | Comments Off on Car Insurance Topics for College Students

Car Insurance Topics for College Students

There are a couple of car insurance related topics every parent of a college student should discuss with their son or daughter before they head off to school. Both have a financial impact on the family’s car insurance rate. The biggest one is allowing a friend or roommate to drive their car or truck if they take one to school. The other one relates to grades. Let’s review this issue and ways to lower your car insurance rate.

Friends Driving Their Vehicle: Most students don’t think twice about letting a friend or roommate borrow their car. They’re not using it at that moment, so why not? The reason they shouldn’t is what happens if the friend is involved in an accident, regardless of who’s at fault. Any time your son or daughter allows one of their friends to drive their car, they put the family’s car insurance in jeopardy. It will be your car insurance which will pay for damages if their friend is involved in an accident, not theirs. If someone is hurt or injured, you may be found liable for medical expenses or worse.

I recommend all parents advise their student to not loan their car to a friend.

  • The moment a car is loaned to someone else, that driver becomes a permissive driver.
  • Insurance follows the car, not the driver. If the friend is involved in an accident, it will be your policy that’s liable not the friend’s.
  • A permissive driver can also put you at financial risk if someone is hurt or killed because of the accident.

Accidents and injury claims will impact your rate with most car insurance companies for 3 to 5 years.

Grades Still Matter: Why pay more for car insurance than you have too? Remind your son or daughter good grades keep the cost of car insurance lower! Students with an A/B average (they can still have one or two C’s on their transcript) earn a discount while attending college. A copy of the most recent transcript will need to be presented to underwriters to receive this discount.

Students With No Car: Many car insurance companies offer a discount if the student attends a school 100 or more miles away from home and doesn’t take a vehicle with them. The reason for the discount is the student doesn’t have a car with them which reduces their exposure for being involved in an accident.

Geographical Rating: Those students who attend a school in a smaller community than the one they live in may help reduce the premium by rating that vehicle with the new garaging address. For example, if the family residence is in Houston, Austin, or Dallas / Fort Worth and the student attends school in Lubbock, College Station, Abilene, Alpine, Waco, or another smaller community, changing the garaging address of their vehicle will lower the premium based on being in a smaller community with fewer cars, and hence, fewer opportunities to be in an accident. This does not work as well if they attend school out of state (Oklahoma, Arkansas, etc.). The reason is it may be less expensive to keep them on the family policy than rate them on their own policy in another state.

What do you think? Share your questions, suggestions, and experiences with me on my Facebook, Google +, or LinkedIn, pages. I’d love to hear from you!

Thanks!

Ed Wise

Wise Insurance Group

Insurance Considerations for College Students

Posted by on Aug 7, 2017 in Blog | Comments Off on Insurance Considerations for College Students

Insurance Considerations for College Students

Does your college student need property or liability insurance? I’m asked this question by clients who have a son or daughter headed off to college each August, and it is that time again. The answer is it depends more on where they’ll live; whether it’s in a dorm room on campus or off campus in an apartment, condo, or home. Let’s review both scenarios.

Dorm Room: If your son or daughter will live on-campus in a dormitory they don’t need renter’s insurance. Most home insurance policies provide coverage for personal property off premises, or items stored in a dorm room, storage unit, etc. The amount your home insurance policy covers depends on the carrier, but it’s usually 10% to 20% of your personal property or contents.

For example, a home insured for $200,000 will have contents coverage ranging from 60% to 75% of the home’s value or $120,000 to $150,000. The amount of off-premises contents coverage will range from $12,000 to $30,000, which should be more than enough coverage for the typical dorm room.

The only caveat is anything lost or stolen is subject to the home insurance policy deductible. Texas home insurance policies normally have a deductible ranging from $1,000 to 1% of the home’s dwelling value which means the home policy deductible will be $2,000 if there’s a 1% deductible for a home with an insured value of $200,000.

Items such as smart phones, laptops, tablets, and musical instruments can be scheduled on most home policies. Scheduling an item on a home policy simply means listing that item or items for their stated value under the scheduled items portion of the policy. This is optional coverage on the home policy and will have a nominal cost to add it. It also usually means there’s either no or a small deductible such as $100.

Apartments & Rent Homes: Many students move into an apartment or rent a home after the first or second year at school. I recommend a renter’s policy when that happens because the student usually has more personal property than their dorm room accommodates. You’ll need enough coverage to cover more electronics, decorative accessories, furniture and any appliances you own such as a washer and dryer.

Renter’s insurance policy rates are determined by the amount of the contents coverage, what type of home the student is living in, where the home is located and protective devices such as fire and burglar alarms. The cost of a renter’s policy will range from $150 to $300 a year. Common deductibles are stated in dollar amounts such as $250, $500, and $1,000 depending on the carrier.

If they have roommates living with them, each roommate will also need their own renter’s policy, as renter’s insurance only covers the items owned by each separate renter. A renter’s policy will also provide personal liability coverage for your student which is needed should someone get hurt when visiting the apartment or home.

Students attending an out of state school will need to get a renter’s policy specific to that state and from an agent licensed in that state. For those students attending school abroad, they’ll need coverage which is written in that country. Where will your student attend college? Share that with me along with your experiences, comments, advice, and questions on my Facebook, Google +, or LinkedIn pages. I’d love to hear from you!

Thanks!

Ed Wise

Wise Insurance Group

Converted School Buses and Car Insurance

Posted by on Aug 2, 2017 in Blog | Comments Off on Converted School Buses and Car Insurance

Converted School Buses and Car Insurance

I received a call a couple of weeks ago from someone who’d been referred to me. The caller needed car insurance for a Blue Bird bus he and his wife were buying. Their plan is to convert it into an RV and live in it as they drive to different parts of the country where they’ll live and work for varying timeframes. The question is what kind of car insurance would they need and who’d write it?

I initially thought this would be an easy policy to write, after all, I have several carriers who write RVs. None would. I then called the underwriters with the broker firms I work with thinking they could write a car insurance policy for it but they couldn’t either. I struck out with all my carriers but had several interesting discussions which helped me understand the difficulty in writing such a policy. Below are the three issues which resulted in the “no” answers I received.

Commercial vs Personal: Blue Bird buses are recognized as commercial vehicles. Anyone who drives a school bus must carry a commercial driver’s license. A RV, on the other hand, is designed as a personal vehicle to be driven be anyone with a standard driver’s license.

Converting a school bus to a traveling home means changing the vehicle classification from commercial to personal thereby requiring an initial commercial policy until it’s converted to a RV. Once the conversion is complete it needs a personal, or RV insurance policy. No carrier or broker was able or willing to write the vehicle one way and then shift it the other way when the project was completed.

Intended Use: This line of reasoning from a couple of underwriters, is similar to whether this is a commercial or personal vehicle. It’s based on what the Blue Bird bus was originally intended to do, carry people. Converting from a commercial vehicle to a personal vehicle changes its original intended use and caused a couple of underwriters to say no. I run into this with a few underwriters when someone converts a commercial building, barn, etc., into a home. These companies won’t write a home which wasn’t originally built to be a home.

DIY vs Skilled Work: The other problem resulting in underwriters declining to write a RV or car insurance policy is who is doing the conversion work. The couple buying the bus are intending to do most of the work themselves. They will have a skilled electrician and plumber assist them with wiring and adding the kitchen and bathroom, but intend to do the finish out themselves.

DIY projects of this kind, as well as on kit cars, make underwriters decline to write an insurance policy unless the person doing the work has the training to craft such as conversion. The reasoning is an untrained owner who’s watched several YouTube videos does not fully understand all the issues such as weight distribution and its impact on steering, braking, etc. which may result in an unsafe vehicle.

The caller was disappointed I couldn’t find a policy for them, but I haven’t given up hope. We’ve added several new car insurance carriers and I’m hopeful one of them can write it. What do you think? Share your thoughts, questions, and experiences with me on my Facebook, Google +, and LinkedIn pages. I’d love to hear from you!

Thanks!

Ed Wise

Wise Insurance Group

 

 

 

 

Why Home Insurance Rates Change Every Year

Posted by on Jul 31, 2017 in Blog | Comments Off on Why Home Insurance Rates Change Every Year

Why Home Insurance Rates Change Every Year

Many people are surprised to learn their home insurance rate will change from year to year. Many times, there will be an increase as we’ve seen in the past few years, and sometimes there will be a decrease. Rates fluctuate, so let’s examine why!

Inflation: Most home insurance policies include an “inflation protection” component within the policy. This is designed to increase the home’s insured value, what it cost to replace the home in the event of a total loss, each year based on the rate of inflation. The average rate of long term inflation in the United States since World War 2 is 3.76%. If the rate of premium increase for a home insurance policy at renewal is between 3% and 5%, that signals to me the rates are stable and not increasing beyond the rate of inflation. If rates are rising at a rate faster than inflation, as they have been for the past five years, then it becomes increasingly important to review our client’s options each year.

Insurance companies didn’t always include an inflation protection component within their home policies. They depended on the agent and their team to review each client’s insurance policies every year to two and adjust them accordingly. The only problem is it didn’t always happen and resulted in many people having a home which was underinsured for a total loss. Inflation protection protects the client from having too little home insurance coverage to replace their home.

Weather: Texas, especially the Dallas / Fort Worth area, has experienced three continuous years of severe hail storms. Insurance companies have paid billions in claims over this timeframe which has resulted in significant rate increases in the zip codes which have been most impacted by hail. As severe weather frequency increases, rates go up, even if you didn’t file a weather-related claim. When the severe weather abates, rates will drop.

Claims: Home insurance is designed to protect the homeowner from financial disaster by moving the risk for a major claim from the homeowner to the insurance company. When claims for water damage, a fire, theft, vandalism, and other non-weather-related events are filed, rates will increase for the homeowner. Being claim free, helps keep rates lower and enhances your ability to move to a carrier with lower rates.

Competitive Pressure: Rates don’t always increase. Sometimes, they do go down. Texas is the second largest home insurance market in the country which means it’s a very competitive marketplace. Some home insurance companies lower rates to increase their market-share and grow their business. When this happens, consumers benefit, if they are willing to evaluate options!

Complacency: Most people I know really don’t enjoy shopping for insurance! They’re inclined to ignore it until they’re surprised it’s changed, and not for the better. Home insurance companies know this so rates tend to rise every year the longer a person remains with that company. That’s why it’s important to review your home and car insurance every two to three years!

One of the advantages of being an independent insurance advisor is I’m able to find the best rate from all my carriers for a client each year! What do you think? Share your comments, questions, and experiences with me on my Facebook, Google +, and LinkedIn pages. I’d love to hear from you!

Thanks!

Ed Wise

Wise Insurance Group

Business Insurance Considerations for Solopreneurs

Posted by on Jul 26, 2017 in Blog | Comments Off on Business Insurance Considerations for Solopreneurs

Business Insurance Considerations for Solopreneurs

I had a fun phone conversation last week with a social media solopreneur about business insurance. Ruby’s business has grown, the clients are getting larger, and she wanted to get a handle on the business insurance she should be considering for her growing enterprise. I believe our discussion provides a great framework for solopreneurs and small business owners contemplating their business insurance needs.

General Liability (or GL) insurance protects your company in the event someone sues for negligence for reasons such as slipping and falling in your office or shop, a contract breach, or potentially issues with a product or service you provided. One of the things I determine is the location of the solopreneur’s office and whether they are meeting with clients or potential clients in their office.

  • Home office where no clients or prospective clients visit may not need general liability depending on the work or service provided. General contractors and trades should carry GL regardless of where they office.
  • Office or retail space whether traditional, co-located, or an executive suite usually necessitates carrying GL. Most property managers will require it. This even applies if you’re hosting a seminar or training in a rented space such as a hotel ballroom.

Common GL limits may be expressed as a single number ranging from $100,000 to $1,000,000 or more or as two numbers. The first number is the per occurrence limit and the second number is the aggregate limit. For most solopreneurs, a $1 million per occurrence and $2 million aggregate limit are sufficient.

Business Owner’s Policy or BOP, is usually a packaged policy which includes GL and other coverage such as:

  • Business Personal Property (BPP) includes office furniture, phones, computers, office supplies, etc.
  • Personal and Advertising Injury protects you if state something inaccurate in an advertisement, use a photograph not licensed to you, make an unsubstantiated claim, etc.
  • Damage to Premises Rented to You covers you to repair any damage to rented space you or a client caused. If you rent an office or retail space, you need this included.
  • Products and Completed Operations applies if you are selling products as a part of your business including reselling third party products such as appliances you install, computer and networking equipment, etc.
  • Medical Coverage to help pay for initial care for a non-employee injured on your premises.
  • Hired and Non-Owned Auto is an option which should be added if you rent a car while on a trip and take a client or prospective client out for lunch, dinner, etc. It even protects you if you send a limo or chauffeured driver to pick someone up.

Not all BOP policies contain all the above coverage so determine what you need and then confirm whether it’s included.

Professional Liability or Errors and Omissions (E&O) insurance protects solopreneurs who provide a service for a fee.  E&O insurance provides coverage for judgments, settlements, and defense costs if the business owner is sued for delivering or failing to deliver a service that meets the expectations of a client.  I recommend E&O coverage for consultants, wedding planners, freight forwarders, software developers, web designers, web hosting companies, photographers, advertising agencies, public relations professionals, commercial printers, social media firms, and many more.

Many solopreneurs don’t carry business insurance thinking they don’t need it, it cost too much, or they’ll avoid mistakes. Depending on what you do, if you’ve had prior losses, have employees, your annual revenue, and the amount of property your business owns, rates can range from a few hundred dollars to a few thousand. That’s not a lot to pay if something goes wrong!

What do you think?  Share your comments, questions, and experiences with me on my Facebook, Google +, and LinkedIn pages.  I’d love to hear from you! And if you need help with your social media, check out www.socialsuccessmarketing.com or connect with Ruby on Twitter, @SocialSMktg!

Thanks!

Ed Wise

Wise Insurance Group

 

 

 

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