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“Alarming” Things About Insurance

“Alarming” Things About Insurance

If you have property insurance (and you should) the application may have asked about your security measures. Do you have armed guards? Do you have a sprinkler system? Do you have a burglar alarm system? In some cases your security measures may earn you a discount on your policy premium. However, they probably also include something else: a Protective Safeguards endorsement. What is that, and could it be a problem? Protective Safeguards Endorsement The Protective Safeguards endorsement will look something like this: The premises and building numbers will correspond with the location(s) scheduled on the declarations page of the policy, and each one will have one or more symbols listed next to it, each starting with “P-”. P-1 is an Automatic Sprinkler System P-2 is an Automatic Fire Alarm P-3 is a Security Service that makes hourly rounds P-4 is a Service Contract with a privately owned fire department P-5 is an Automatic Commercial Cooking Exhaust and Extinguishing System P-9 is any other protective system shown and described in the schedule Why List Protective Systems? If you list a protective system on your application, you will most likely receive a discount on your coverage. However, the insurance company will require that the protective system be in complete working order at the time of a loss, otherwise they will not pay on the claim. The endorsement itself includes a provision adding an exclusion to the policy that says if the policyholder knows that the protective system was not working prior to the loss, then there is no coverage. If the protective system fails because it was not properly maintained, there...
Limited By Your Business Insurance?

Limited By Your Business Insurance?

As a business owner, it is natural for you to always be looking for ways to make a profit. Sometimes these ideas come in the form of new products and services that you can provide to customers. Innovation is important in any industry, but there might be one small hitch in your plans. Does your current insurance policy cover the new service or product? How can you tell? General Liability Policy Hazards On your general liability policy (or your package policy that includes liability) there is usually a page that lays out the hazards and rates. This page includes the following: Class Code. This is a five-digit code number that is assigned to each and every industry component. What your business does will fit into one or more class codes. For example: 91560 – Concrete Construction 97447 – Masonry Some are even more specific, such as restaurants, where classification options include whether alcohol is sold, how much is sold, and whether there is table service. Description. This is a brief description based on the class code number. Rating Basis. This is where your premium amount comes from. Each class code has a basis, which can be area, subcontractor costs, payroll or gross receipts. Rate. This is how the premium is calculated. Insurance companies set rates for class codes and then multiply them by the rating basis to get the premium they will charge. It is a good idea to review this page with your insurance broker to be sure that your business is classified correctly and that all components of your business are accounted for. Sometimes insurance companies will...
What Your Property Insurance Doesn’t Cover

What Your Property Insurance Doesn’t Cover

Ask the average homeowner what their property insurance covers and they will probably say “not much”. All too often homeowners make claims against their property insurance for common occurrences that simply aren’t covered by the policy. There are many things covered by property insurance: fire, lightning, explosion, smoke, windstorm, hail, riot, civil commotion, aircraft, vehicles, vandalism, sprinkler leakage, sinkhole collapse, volcanic action, falling objects; weight of snow, ice, or sleet; water damage (in the form of leakage from appliances); and collapse from specified causes (unless, of course, any of these are specifically excluded). However, there are some specific exclusions you should be aware of since claims for any of these will not be covered under your policy. Vermin & Animals The specific property exclusion in the Homeowners 3 – Special Form (HO3) policy form looks like this:     Vermin includes lice, fleas, roaches, bed bugs, and rodents. Damage or infestation by these pests is not a covered peril under your homeowner’s insurance policy. Damage to the home and subsequent repair and treatment of the home would be an out-of-pocket expense. So what is considered a rodent?  According to Wikipedia, the most well-known rodents are mice, rats, squirrels, prairie dogs, chipmunks, porcupines, beavers, guinea pigs, hamsters, gerbils, and capybaras so damage by these would not be covered. What about skunks, bats or raccoons? None of these are considered insects or rodents, so coverage would most likely apply to damage made by these creatures. However, check with your broker or insurance policy for a complete definition. As for part (h) – “Animals owned or kept by an ‘insured’” this means...
State Minimum Auto Insurance

State Minimum Auto Insurance

During every sporting event, there are plenty of ads on TV touting the latest online auto insurance company. Each offers online quoting, low down payments and state minimum auto insurance. Those all sound great, but are they? Remember that old adage that “you get what you pay for”? Let’s talk more about state minimum auto insurance. What is State Minimum Auto Insurance? Nearly every state requires that drivers have insurance or financial responsibility in order to drive a vehicle. Since insurance is mandatory, states have established state minimum auto insurance requirements for drivers. State minimum auto insurance limits are the minimum amount of liability insurance (both bodily injury liability and property damage liability) that the state requires for a driver to be “legal” to drive. These limits vary from state to state. Below are some examples: California $15,000 bodily injury liability per person $30,000 bodily injury liability per accident $5,000 property damage liability per accident Florida $10,000 property damage liability per accident $10,000 personal injury protection Here is a handy guide to the websites and information for state minimum auto insurance requirements by state. What Isn’t Required As State Minimum? State laws require only that drivers have minimum liability insurance limits for bodily injury and property damage. Still others require minimum limits of personal injury protection for insured drivers and their passengers. What usually isn’t required is coverage for comprehensive and collision damage (also known as “full coverage”) or uninsured/underinsured motorist coverage, towing & labor, or rental reimbursement. Should You Purchase State Minimum Auto Insurance? As a law, you MUST purchase at least the state minimum in order to...
Happy Holidays

Happy Holidays

It is the time of year when we all reflect on the past 365 days and look forward to the coming year. Hayes Brokers wishes all of our current and future clients a happy holiday season and a prosperous 2019.