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New York State Disability Benefits Law – Is Your Small Business in Compliance?

by Michael Cohen, The DBL Center

NYS DBL

Surprising numbers of New York small business owners are unaware of an important mandatory insurance benefit, New York State Disability Insurance or Disability Benefits Law (NYS DBL). You probably already know you are required to pay unemployment insurance and to provide workers’ compensation coverage to employees. But NYS DBL, or disability insurance, often flies under the radar. Yet it applies to most New York businesses with at least one employee. And business owners who don’t comply could face fines and even (in a worst-case scenario) imprisonment.

That’s the scary news. The good news for business owners is that disability insurance in New York is extremely affordable. You can even enrich your disability benefits package beyond the minimum coverage levels as part of a generous ancillary benefits package that can help you recruit and retain top talent.

What Is Disability Benefits Law?

NYS DBL is mandatory insurance that covers employees who are ill or injured, replacing a portion of their income until they are well enough to work again. Disability insurance does not cover employees who are hurt on the job. It is workers’ compensation that covers medical expenses and replaces income lost for on-the-job injuries. DBL insurance is only for employees who have an illness or injury that is not work-related. In addition, disability insurance replaces a portion of lost income; it does not cover any medical expenses.

Employers in New York State can provide mandatory DBL coverage through the New York State Insurance Fund (NYSIF) or can choose to write their disability insurance policy through a private insurance broker, such as Coastal Agency.

Who Needs to Provide Disability Benefits Law Coverage to Their Employees?

Any business owner who has at least one employee working more than 30 days is required to provide DBL coverage to their employees who:

  • have worked full-time for a covered employer for four consecutive weeks
  • have worked part-time for a covered employer for 25 business days
  • return to work after receiving unemployment benefits
  • work as personal or domestic employees for the same employer in a private home at least 40 hours per week

When determining DBL requirements, the size of the company or number of employees it has does not matter. This makes disability insurance one of the widest reaching employee benefits mandated in New York State. Only a few exemptions apply.

For instance, employees of the government, railroad, or maritime industries are not eligible for DBL coverage. In addition, employees of not-for-profit religious, charitable, or educational institutions may not require disability benefits law coverage in New York State. Partners in corporations with no other employees, as well as sole proprietors, do not require coverage, either.

In short, if you own a business in New York, from a pizzeria on Main Street to a large manufacturing facility in an industrial park, you need to know about New York State Disability Insurance, where you can purchase it, and how you can leverage this mandatory expense to your advantage as part of a robust benefits package.

Who Pays for DBL Coverage?

Disability Insurance New York

Disability insurance in New York is an employee-funded benefit, which means employers are authorized to deduct pre-tax dollars from an employee’s paycheck to cover the premiums. The maximum allowable employee contribution for the state-mandated minimum disability coverage is one-half of 1 percent of wages, but no more than 60 cents per week. Employers may also opt to cover the state-mandated minimums themselves, waiving all employee contributions.

The statutory coverage provides injured or ill employees with a maximum of 50 percent of an employee’s average weekly wage, up to $170 per week for 26 weeks, as salary replacement while they are on disability leave. Maximum allowable contributions rise if an employer opts to enrich the benefits package beyond the statutory minimum.

As far as benefits go, state-mandated DBL and enriched DBL benefits packages don’t cost much, at all, but the income they provide can help ill or injured employees through difficult times until they can work again.

New in 2018: Paid Family Leave as a Rider to Disability Benefits Law

In 2018, New York State blazed a trail with a new employee benefit that is mandated as a rider to Disability Benefits Law coverage. The New York State Paid Family Leave Act provides paid leave and job security to employees who have a newborn, adopted a child or taken a child into foster care within the past 12 months, are caring for a seriously ill family member, or have a military spouse who has been deployed. Unprecedented in the U.S., this generous mandatory benefits package helps support family-friendly workplaces and improves retention amongst workers starting families or caring for older family members.

In 2018, PFL pays out 50 percent of an employee’s average weekly wage, up to $652.96, for up to eight weeks. The benefit will increase for the next four years, until, in 2021, it eventually pays 67 percent of the employee’s average weekly wage for up to 12 weeks.

Unlike DBL coverage, Paid Family Leave is an employer-funded benefit. In 2018, deductions equal 0.126 percent of the employee’s weekly wage, capped at $85.56 annually.

It is important to understand PFL coverage, because Paid Family Leave insurance is written as a rider to your New York State disability insurance policy.

What’s the Difference in Purchasing Disability Insurance Through the State Fund or a Private Broker?

If DBL and PFL are mandatory benefits required by the state of New York, with set premiums and allowable deductions, why should it matter where you purchase your disability insurance?  When you purchase your disability insurance through a certified insurance broker, instead of the New York State Insurance Fund, you’ll enjoy a number of advantages. Although the rates and premiums are the same for state-mandated DBL coverage, you won’t be left to navigate the complicated application process on your own.

Your Coastal Insurance representative can bind your policy, providing the necessary paperwork to help you avoid fines that could come with non-compliance.

Should You Provide Enriched DBL Coverage to your Employees?

Disability Insurance Coverage

When you write your New York State disability insurance through a private broker, you also have the option to purchase enriched DBL insurance, which covers up to 60 percent of an employee’s salary, with weekly maximums up to $850.  Since $170 weekly is not a living wage for any Long Island employee, including covered business owners, enriching DBL provides a benefit that can help employees through a difficult time, improving retention of employees after an injury or short-term illness.

Many employers feel if they are providing a generous benefit to employees on Paid Family Leave, they should do the same for employees who may be ill or injured. As benefits go, it does not cost a lot to enrich DBL coverage. A small investment can go a long way toward providing your employees with peace-of-mind if they should be unable to work for a time.

If you bundle enriched DBL coverage with ancillary benefits, such as vision and dental insurance, you can put together a robust benefits package that could help entice, and retain, employees.

Of course, only a licensed and knowledgeable New York State insurance broker can advise you on the best coverage for yourself and your employees. Do not trust the NYSIF, a government agency, to act in the best interests of your New York small business. Let Coastal help you find the best benefits package for your budget and help ensure you are in compliance with New York State disability benefits law.

Michael Cohen is President and CEO of The DBL Center, a general wholesale insurance agency serving more than 4,000 insurance agents across 15 states, with a luxury premium block of $50 million. The DBL Center specializes in temporary disability insurance in New York, New Jersey, and Hawaii, as well as ancillary benefits that include vision, dental, and life insurance.

Tips on How to Get the Right Coverage for Your Home

The reason why homeowners purchase insurance is to protect themselves from disaster. According to a recent survey people who filed insurance claims during the last couple of years feel their insurance did not meet their expectations-particularly if they had a big claim of $20,000 and over.

The survey found that if your damage is greater, this increases the possibility of disagreeing with your insurer about the value of the loss. 6% of those who claimed less than $20,000 said that they disagreed with the insurance company about the claim amount. But when the damage was worth $20,000 and over, 10% of the respondents differed with the insurance company’s assessment of their claim. In addition, 3% of these individuals said the insurance company delayed when settling their claims. This was three times the rate for respondents whose losses were valued under $20,000.

Insurance companies shift the risk to you

The usual deductible for standard homeowner’s insurance policies varies between $500 and $1,500. But for claims arising due to harsh weather conditions like hail, wind storms and hurricanes, you might be required to pay as much as 5% of the insured value of your home to cater for damage costs. This amount can rise to 10% if you live in Florida. Therefore, if your home’s insured value is $235,000-the median price as at November 2016-and there is a 5% hurricane deductible in your policy, you will be required to pay a sum of $11,750 from your pocket for a claim that is storm-related.

A lot of insurance companies have pulled out of areas that are susceptible to hurricanes and they are avoiding paying other types of claims using contract language. For instance, although you might have hail coverage, your roof can be excluded if it is over 10 or 15 years old. Other times you may buy a typical homeowner policy that provides coverage against an overflowing bathtub or frozen/burst water pipe, but you are still in trouble if your sump pump cannot deal with a backed-up sewer or a huge downpour. To avoid such problems, you will have to fork out from $40 to $50 annually for an endorsement that covers that scenario.

Regrettably, many people treat shopping for insurance as a one-time thing which they quickly forget about. To start with, home-loss claims are rare, and 50% of them are for $8,000 and below. As a result, consumers do not get an opportunity to improve their skill when shopping for the service and they seldom get a chance to evaluate its performance before they buy. This is precisely why we use the claim-filing experience of our subscribers as the basis for our ratings.

Having outmoded assumptions about your insurance coverage can be quite costly. Here are a few tips that will assist you to find the best and most cost-effective coverage for your home:

Find the right insurance coverage

The true test of an insurance company’s credibility and suitability is its handling of claims. Some leading insurance companies offered considerably better satisfaction when handling claims when compared to the rest. The biggest indicator of customer satisfaction was demonstrated when it came to the issue of damage estimates. Generally, a larger percentage of customers of the poorly-rated insurers disagreed with the damage estimates they were given, and they believed the money they got after the final settlement was too little.

If you are dissatisfied, challenge the claim amount

Do not hesitate to file a small claim. There was no price increase for 57% of our subscribers when the value of their claim was below $5,000. For those clients who saw an increase, on average the amounts involved did not exceed $150 annually.

For the most part, the respondents in our survey agreed with the insurer, regardless of the size of the claim. However, customers disagreed with their insurers regarding the damage amounts in 6% of the cases. Our survey found that disagreements were more frequent after the occurrence of massive hurricanes.

In such circumstances, it might be beneficial to negotiate with your insurance company. Those who were dissatisfied and contested a claim were paid $6,000 more than the ones who did not. In case the adjuster states that your insurance policy does not cover a particular damage, request them to show you the specified contract language.

If you are disputing the damage amount, ask for a discussion with the insurer and adjuster so you can read the estimate word-for-word. If you are still not satisfied, request an independent contractor to give you a second opinion. It is important for you to be patient and tenacious and to put in a lot of effort to get a few estimates.

In case you are deadlocked, think about getting a public adjuster to conduct negotiations on your behalf. You will pay them a fee of between 10% and 25% of your payment-subject to state limits and depending on whether the insurance claim is linked to a publicly-announced emergency.

People who engaged a public adjuster got higher settlements (between 19% and 747% higher) on claims related to hurricanes than those who did not. For claims that did not involve disasters, the settlements were higher by 547%. However, closing such cases take longer.

In case you have been misadvised by insurance sales personnel regarding the wording in your policy, talk to a lawyer who is an expert in insurance law. While lawsuits are not common, courts have regularly sided with policyholders when it comes to such ambiguities. You can also opt to go for arbitration.

Search for a more favorable deal

While home insurance companies do not use price as a basis for competition as frequently as auto insurance companies, you may still save up to $1,000 annually in premiums if you shop around.

Inhabitants of Florida, California and other states where the insurance departments publicize rate comparisons for normalized coverage can pinpoint the lowest-cost insurers and then get in touch with them for tailor-made quotes. In case your state does not provide such assistance, talk to an independent insurance agent who deals with multiple insurers.

As you shop around for a more affordable insurance company, consider purchasing your auto and homeowners insurance from the same carrier and you can realize savings of up to 30%. And bear in mind that most of insurance companies use insurance scores that are credit-based when determining premiums and qualification for coverage. By and large, having a good credit score means you will pay a lower premium.

Avoid underinsuring

It is also possible to save money by not paying out-of-pocket costs due to coverage that is insufficient from the outset. People who made claims discovered they were in fact underinsured. This problem is aggravated when a wildfire, hurricane, earthquake or tornado renders a home a complete loss.

Avoid making the mistake of presuming that the coverage limits for your insurance policy will readjust automatically to match the falling and rising market value of your house. What you need to consider is the replacement value (the cost of materials and labor needed to rebuild). The replacement value can be considerably higher than the price your home will fetch on the market.
Request your insurance company to give you a personalized estimate of your house’s replacement cost. The figure should take into consideration its age, construction details, distinct features and cost of adhering to new building regulations. You need to reevaluate your insurance coverage needs after every couple of years.

Even where your level of coverage is appropriate, a normal homeowner’s insurance policy is still inadequate. If you wish to get protection against the sharp upsurge in labor and material costs that usually follow a natural calamity, you will need to purchase an extended replacement cost coverage rider which normally pays an extra 30% of your policy’s limit.

There will also be an additional payment for a law or ordinance endorsement rider that pays the extra home rebuilding costs in conformity with the building codes in your locality. A standard policy does not include coverage for a sewer backup, but you can pay more for it. To avoid incurring out of pocket costs for damage, you require additional coverage for earthquakes and flooding. Furthermore, you might need separate coverage for wind, hail and hurricanes if you reside in a high-risk area.

Insurance coverage for your clothing, electronics, furniture and other personal possessions is standard. However, if you own expensive jewelry, silverware, artwork or furs, the coverage for them is limited. You require to buy a floater or special endorsement so that they are covered for their full value.

Liability protection for the damage that you, your pets or your children may cause to other people is also standard. The guests that may be injured in your home are also covered. Whereas coverage normally starts low (at $100,000), it is advisable to raise it to $300,000 and over. As the assets you own increase, it is recommended that you purchase an excess liability or umbrella policy with coverage of over $1 million.

As might be expected, all these add-ons raise your total premium. However, you can compensate for a portion of the cost by increasing the deductible on your policy to $500 or even $1,000-and this lowers your premium. Ensure that you have adequate savings to cater for the deductible if you run into financial difficulties-and that includes increased deductibles for hurricanes, wind and hail.

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Minimize your risks

Losses lead to out-of-pocket costs and higher premiums in 29% of cases. You therefore need to prevent them by lowering your risks.

Begin by doing what insurance expressly offer discounts for. Installing burglar alarms, dead-bolt locks and smoke detectors can result in a 5% discount. A state-of-the art sprinkler system that is connected to first responders can get you a discount of between 15% & 20%.

Using fire- and impact- resistant roofing materials designed using rubber, cement, metal and asphalt can get you additional discounts because they can withstand debris, hail and embers-which are the root cause of damages due to wildfires. Fire-resistant siding offers extra protection.

In zones that are susceptible to hurricanes, storm shutter for windows and doors, code-standard roofing that can tolerate 130 miles per hour winds and hurricane-resistant siding will assist your home to weather a storm. Fortified houses have the capacity to withstand category four hurricanes.

In 2011 lightning, debris removal and fire are responsible for the highest claims among all insured risks-an average of $27,700 per claim. The major cause of house fires is cooking equipment; therefore, you must avoid leaving a stove untended. In addition, ensure that there is a fire extinguisher in your kitchen.

If the area you reside in is earthquake-prone, the building frame of your home must be correctly anchored to its foundation. For additional information on how you can minimize risks from freezing weather, wildfires, earthquakes, lightning and so on, visit disastersafety.org

Insurance companies recommend a simple solution to avert a minor disaster that can result in damage worth thousands of dollars if there is nobody at home: instead of continuing to use the regular rubber hoses in your washing machine, replace them with reinforced stainless-steel washer hoses that cost only twenty dollars each.


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Insurance 101 – Homeowners Coverage

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 Get 10 FREE QUOTES from Top-Rated Insurance Companies

 

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The Importance Of Shopping Around For Home Insurance Quotes

You have heard people repeatedly emphasize the importance of shopping around before purchasing an insurance policy.

The reason why this is said time and again is that it is sound advice-and you can realize huge cost savings. This is amply evidenced by a recent simplified and unscientific survey on home insurance quotes that concentrated on sample addresses in fifteen cities spread throughout the US.

The survey looked at the websites of four leading insurance companies and collected quotes for annual homeowner’s insurance for each address. The insurance quotes were collected in the month of June 2013 and were based upon full replacement insurance coverage worth $250,000 for a single-family house and a liability insurance coverage worth $300,000. Each of the policies had a $500 deductible, $500 property damage replacement limit and a medical insurance coverage worth $1,000 per individual. Some companies in the survey did not give quotes for some locations.

Even though the survey was quite limited, it still shows that there can be significant difference in insurance costs. Therefore, it is crucial to get and compare a number of quotes when purchasing insurance.

The variation in rates was as high as 188%

In one address in Chicago, the difference between the highest and lowest home insurance rates among the four companies was 121%. This means that one policy cost double the other one, and yet both offered similar coverage.

In an Indianapolis address, quotes from three of the four companies indicated a 56% difference between the highest and the lowest. For another sample address in Roanoke, Virginia, the rates given by three of the four companies showed a variation of up to 67%.

One address in Wichita Kansas showed the biggest difference of a whopping 188% between the lowest and highest among rates provided by three companies. This basically means that one insurer would charge almost three times the rate of another company for the same coverage.

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HOMEOWNERS INSURANCE QUOTE

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 Why the price variations?

According to a spokesman of a trading group known as the Insurance Information Institute that is based in New York, home insurance rates are approved by State insurance departments every year based on expected and actual losses within that state. Whereas insurers should produce actuarial data to explain their proposed rates, both insurers and regulators have the same goal of making sure each company has the financial ability to pay for any insurance claims.

One likely explanation for the wide variations in the quotes that you might get when shopping around is that insurance companies allocate different weights to the factors used in determining the rate of your homeowner’s insurance. These factors include the risk of natural disasters (such as tornadoes, hail storms and hurricanes), crime rates and the cost of building in your locality.

The impact of severe weather on insurance companies

The variation in rates probably indicates the differences in how insurance companies are holding up against recent catastrophes, the pattern of inclement weather in states such as Minnesota, Missouri and Oklahoma have caused sizable insured losses.

The city of Moore has been struck by massive tornadoes two times in the last 14 years. Minnesota has experienced snowstorms and flooding-most memorably the blizzard that led to the collapse of the roof of the Metrodome in 2010.The tornado that hit Joplin, Missouri,in 2011 was the largest insurance event in Missouri’s history.

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Harsh weather is the main contributor to rising home insurance rates. Other factors include diminished rate of returns on the investments of insurance companies, increased rebuilding costs, higher re-insurance (the insurance that protects insurance companies) rates and regulators allowing small rate increases over several years instead of the necessary larger ones.

 Do huge storms immediately translate to higher rates?

Increases in insurance rates do not immediately come after disastrous events, even though it seems that way. As a matter of fact, future events are reflected as much as past events in the home insurance quotes you get.

Insurance companies increasingly apply models. For instance, when it comes to hurricanes, they use about 10,000 years of forecasted data, trying to incorporate each kind of storm that is likely to occur using an expected frequency. For example, there are storms that may occur once in a thousand years while others happen every ten years. The insurance companies try to use all this information when pricing their insurance policies.

This might explain why inhabitants of New Jersey and New York can relax for now.

Projected data before New York was hit by Superstorm Sandy occurred, and the expected losses were greater than actual losses. Models provide more stability when it comes to pricing the insurance policies. Consequently, insurance companies had no reason to hike the rates after Superstorm Sandy because it was already included when pricing the policies. Such disasters should not lead to a massive change in the rates.

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Insurance 101 – Homeowners Coverage

How Do Insurance Escrow Accounts Operate?

Escrow Account

Escrow Account

Insurance Escrow 101

An escrow account is established to collect payments such as your homeowner’s insurance, property taxes and other items in equal installments over the year. The bills are then paid as they fall due. If the lender agrees you can pay the bills yourself.

The mode of payment is at the sole discretion of the lender or the investor who finally purchases your loan. Because it is in the interests of the investor that you pay all the bills as required, they always prefer an escrow arrangement. For example, you fail to pay your property taxes, at the end of the day this will lead to a tax lien against the property (which ranks higher than theirs). If you are behind in your insurance payments and a major fire destroys the house, there will be no protection to cater for rebuilding costs, yet the house is the basic collateral for your home loan.

If you are a first-time homebuyer, a little explanation is in order. Lenders are the primary funders of mortgages, they normally sell their loans soon after closing to other investors trading on the secondary markets. Examples of such investors include banks, pension funds or investment entities. The final buyer of your loan typically engages a third-party servicing firm to collect your payments and distribute the funds. So, the term lender may refer to your lender or servicers or investors.

Dealing with escrow taxes and insurance fees

Most people prefer escrow accounts because they find it easier to pay their insurance and taxes monthly. It is harder to set aside funds for these obligations each month on your own, so you can pay when they become due every year. You may also be tempted to use the funds to settle these bills if the money was lying in a bank or even your desk drawer. An escrow is like a type of forced savings that ensures that the bills will be paid promptly, and you will not incur late fees and penalties

The law restricts the amount of money a borrower should pay where the lender asks for an escrow account. Usually the lender will divide the total cost of your expected property tax by twelve and this is the money they will collect in addition to the interest and principal payment. This also how your homeowner’s insurance and any other items requiring an escrow like flood insurance and homeowner’s association dues will be treated. These combined costs will be your escrow payment.

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Establishing the amount of money to be placed on escrow

To get a rough estimate of your monthly escrow payment, just add these charges together and divide them by twelve. For instance, if you have an annual tax bill of $2,000 and the insurance cost is $600 per year, then your monthly escrow payment shall be $2,600 divided by twelve which comes to $216.67. Note that lenders are legally required to keep a cushion of up to one sixth of the total money paid from the account or money equivalent to two months payment to ensure the escrow account always has a balance. In addition, bear in mind that your escrow payment can change annually when your insurance or taxes increase, or if it becomes necessary to adjust the cushion amount.

While this is done automatically, mistakes do happen, and you need to monitor your account from time to time. If you receive a late notice from your insurance or county, then you will know there is something wrong. But you need not worry because the lender is required to pay all penalties for being late in payments. For this reason, the law stipulates that you be given a full breakdown within 45 days of setting up an escrow account, showing the projected amounts to be paid during the following year. You should also be given a free annual statement that highlights the activities in the account, for example which bills were paid, and an explanation regarding the amount of money you must pay in the next one year to ensure your account stays current.

If the loan is new, lenders have a tendency of underestimating the money they collect for insurance and taxes mainly because they are only able to estimate these costs. In addition, it means your initial payments become more affordable. Therefore, prepare for a rise in the escrow part of your payment-the tenant improvement (PI) portion of your principal, interest, taxes and insurance (PITI)-after the first year. Sometimes the increase may be big enough to shock you, so you need to get ready.

Escrow deficits and surpluses

In the event there is a deficit in your escrow account in a year, your lender might give you several options to settle the difference. For instance, you may pay for the full shortfall immediately or using twelve equal payments during the next year so that the deficit is cleared by the time the next anniversary of the loan comes around. At other times, the lender can give you a combination of the two methods which means you pay some money now and spread the remainder over the next one year.

If your escrow account has a surplus where the lender collects too much during the preceding year, the lender might do one of two things, based on the size of the surplus. If it is an over a specific amount, the lender will write you a check. If the surplus is smaller, it will be applied to the escrow payments for the following year. If you are told to choose, know that what the lender gives in one year will probably be taken away the following year in form of increased insurance premiums or higher taxes. It is always advisable to let it slide unless you direly need the money.


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15 Ways To Reduce The Cost Of Your Homeowners Insurance Policy by 20%

home-If you own a home or are in the process of buying your first house, you must know by now how expensive home insurance premiums can get depending on the size, content and insurer of the home.

How much you pay for your homeowners insurance may differ by hundreds of dollars. Just by making some small changes to your home insurance policy, we can help you reduce this fee. We have put together a list of the most important factors that will lower your home insurance premium by at least 20%.

15 Ways to Save 20% On Your Homeowners Insurance Premium:

  1. Shop around
  2. Increase your deductible
  3. Leave out the value of land when assessing the insurance need
  4. Buy several policies from one insurer
  5. Reinforce & upgrade your home
  6. Update the security of your home
  7. Search for discounts
  8. Maintain a healthy credit score
  9. Remain with the same insurer
  10. Reassess your policy and values annually
  11. Get private insurance in case you are covered by government insurance plan
  12. Think about homeowners insurance whenever you are purchasing a home
  13. Call your current agent or broker
  14. Add an umbrella policy
  15. Ask for a list of discounts your homeowners insurance company offers and compare that to the list applied to your policy

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1)Shop around

It might be time consuming, but you can save a sizable amount of money. Get help from your friends, talk to the insurance department in your State or browse the yellow pages. The National Association of Insurance Commissioners possesses information that might help you out when selecting an insurance company in your particular state. You can also go through their site (www.naic.org) and get information relating to the insurer, including any complaints relating to them. States frequently reveal information relating to the standard rates charged by the leading insurers and a lot of states provide lists detailing the rate of customer complaints per insurance company.

look-around-home-insuranceIn addition you also need to look at online insurance quote services, information concerning agents and companies as well as consumer guides. This will let you have a rough idea of the range of prices available and reveal the insurers with the most affordable prices. However, you must consider other things besides the prices. The company that you choose must give a reasonable price and provide the level of service you would hope for if you needed help when filing an insurance claim. Therefore, as you evaluate the quality of service, utilize the complaint information mentioned above and speak to several insurance companies to get an idea about the type of service they provide. Request them to explain what action they would take in order to reduce your costs.

Analyze the financial solidity of the companies you are thinking about using consumer magazines and rating firms like Standard & Poors (www.standardandpoors.com/ratings) and A.M. Best (ambest.com). After you narrow down your choices to three insurance companies, ask them to give you price quotes.


2) Increase your deductible

increase deductibleA deductible essentially refers to the specified sum of money that you must pay towards covering a loss before your insurer starts to pay, as stated in the terms of the policy. When you pay a higher deductible, this means that you will pay less premium. Many insurance companies these days advise that you increase the amount to over $500. It is possible to lessen your insurance costs significantly if you could manage to increase your deductible to $1,000. Note that if you reside in a region that is disaster-prone, your policy could have a separate deductible for specific types of damage. In case you live near the Eastern coast, you could get a separate deductible for windstorms. Where your home state is susceptible to hailstorms, you could have a separate hail deductible. In the same vein, if your locality is vulnerable to earthquakes, your earthquake policy may contain a deductible.


3) Leave out the value of land when assessing the insurance you need

Your land cannot be endangered by windstorm, fire, theft or other perils defined in your homeowners insurance policy. For that reason, disregard its cost when working out how much homeowners insurance coverage you need to buy. When you fail do that, you may find yourself suffering higher costs than necessary.

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4) Buy several policies from one insurer

Savings ProtectionSome insurance companies that deal with homeowners, liability and auto insurance coverage will reduce your premium by five to fifteen percent if you purchase more than one policy from them. However, make sure that the unified cost is less than buying individual insurance policies from various companies.

 


5) Reinforce and upgrade your home

reinforce-homeRequest your insurer or insurance agent to advise you on the best course of action so as to ensure that your home can resist windstorms and other such natural calamities. You might lower your policy premiums by installing shutters that are storm-resistant, reinforcing your roof or even procuring more robust roofing materials. Older houses can be modernized to improve their ability to resist earthquakes. Additionally, think about upgrading your electrical, plumbing and heating appliances so as to bring down the risk of water and fire damage.

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TOP HOMEOWNERS INSURANCE CARRRIERS

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6) Update the security in your home

update-home-securityNormally, you can obtain discounts of more than five percent for installing dead-bolt locks, burglar alarms and smoke detectors. Several companies offer to reduce your premium by about 15 or 20 percent if you put up an advanced sprinkler, anti-fire and anti-burglar system that is connected to the fire and police stations or other monitoring services. Such systems can be expensive and not every system makes you eligible to be awarded a discount. Prior to installing such a system, get recommendations from your insurer regarding the best device, the cost and how much savings you will realize on premiums.


7) Search for discounts

Insurance companies give different kinds of discounts which vary in amount and depend on the particular state. For instance, retired people are at home more than working people. This lowers the likelihood of getting burglarized, and they can detect fires earlier. In addition, they have more time to maintain their houses. As a result people who are more than 55 years old and have retired can qualify for at least 10 percent discount by various insurers. There are professional bodies and employers insurance plans that can offer better bargains than what is in the market.

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8) Maintain a healthy credit history

several-policies-one-insurerBuilding a strong credit history can lower your insurance costs. More and more insurers are using credit data to set the price homeowner insurance policies. The majority of states require the insurer to advise the insured about any unfavorable action, for example when charging a higher rate. When that happens, you are supposed to ascertain the accuracy of the data used by the insurer to justify the increase. In order to safeguard your credit rating, pay your bills promptly, do not apply for more credit than you need and maintain your credit balance as low as you can. Monitor your credit record frequently and get any errors rectified immediately so that your credit record stays accurate.


9) Remain with the same insurer

If you have maintained your insurance coverage with the same insurer for a couple of years, you may get a special discount as a reward for being a good customer. Some insurance companies cut their premiums by five percent in case you remain with them for three to five years and ten percent if you stay with them for a period of six years and over. However, it is important to compare the cost of their policies with those of other companies from time to time.

Get-10-Free-quotes-Renters-Insurance


10) Reassess your policy limits and the value of your assets annually

Home Contents InsurancePreferably, your policy ought to take into account any significant purchases or upgrades to your home. Obviously, it is imprudent to spend money on insurance coverage that is not really necessary. If you have a fur coat that you bought for $5,000, it might not be worth that much today. It is therefore advisable to lower or scrap your floater (additional insurance for articles whose total value is not covered by normal homeowners policies- for example precious artwork, high-end jewelry and expensive computers) and keep the extra cash.


11) Get private insurance in case you are covered by a government insurance plan

If you reside in a region that is dangerous, for example one that is susceptible to crime, coastal storms or fires and you have been purchasing your homeowners insurance policy using a government plan, it is important to reach out to the sales department of your insurance company, insurance agent or the staff at your state department of insurance and get the names of insurers who may be keen to get your business. You might learn that there are things you can do to purchase insurance at reduced cost in the commercial market.


12) Think about homeowners insurance whenever you are purchasing a home

purchasing-home-insuranceYou can lower your insurance cost by buying a home that is adjacent to a fire hydrant in a neighborhood that is served by a professional (not voluntary) fire department. It can also be less expensive if the plumbing, heating and electrical systems in your home were installed less than ten years ago. If you reside in the eastern section of the country, consider buying a home that is constructed using brick since it has more wind resistance. If you reside in a zone that is susceptible to earthquakes, consider getting a wooden frame home since it can tolerate earthquakes better. Making a smart selection can lower your premiums from five to fifteen percent.

Study the Comprehensive Loss Underwriting Exchange (CLUE) report of the house you intend to buy. Such reports detail the insurance claim history of the property you intend to buy and it can help you as you evaluate some of the issues in the house.

Flood InsuranceNote that a normal homeowners policy does not cover earthquake damage and flood insurance. In case you purchase a home in a region that is susceptible to floods, you will have to take out a flood insurance cover that goes for about $400 per year. The Federal Emergency Management Agency offers beneficial information concerning flood insurance on their website page (fema.gov/nfip). An individual earthquake policy is offered by the majority of insurers . The cost of the insurance policy will be determined by the probability of experiencing earthquakes in the region you live. In California, this coverage is provided by the California Earthquake Authority.

Assuming that you have any queries pertaining to the insurance needs of any of your belongings, remember to ask the sales representative of your insurer or agent as you are searching for the best policy. As an illustration, when you conduct your business from your home, see to it that you talk about insurance coverage for such a business. The majority of homeowners insurance covers protect the business equipment in your home-but coverage is capped at just $2500. Furthermore, they do not offer any business liability insurance coverage. Even though you want to reduce the price of your home owners insurance, it is also important to ascertain that you have all the coverage you require.


13) Call your current agent or broker

Contact home Insurance AgentMany times, your current agent or broker may have an inside scoop on a new product or program that has become available in your area. Give them a call and ask them to look over your policy and make suggestions on ways to lower your premium without sacrificing coverage.

 


14) Add an umbrella policy

It may seem silly to add coverage to save money but many insurance companies offer large discounts to clients that have a homeowners policy and add an umbrella policy. The reason is retention. Data shows that clients with two or more insurance policies in force with the same company are less likely to put in a claim and more likely to remain a client of theirs.


15) Ask for a list of discounts your homeowners insurance company offers and compare that to the list applied to your policy

reassess-home-policyMany companies are required to offer discounts to clients when they request them but they aren’t upfront about which ones are available. For instance, are you a non-smoker? Does your policy show a non-smoker discount? Lots of insurance companies offer a discount for being a non-smoker but either forget to offer it or never ask the client. Getting a full list of discounts offered by the insurance company and comparing those against the discounts listed on your current policy is one way to ensure you aren’t missing out.

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