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Hard Times for Auto Thieves

Wednesday, June 9, 2010

Auto thefts nationwide are decreasing quickly. Based on the FBI’s estimates, auto theft rates are down 20 percent from last year! As new technology and dedicated cops are cracking down the bad guys, this means two things for you: 4685240585_490e434406.jpg

1)      you don’t need to worry so much about your car being stolen, and

2)      this could mean cheaper insurance rates for you. 

Most insurance companies calculate their rates based on the number of claims made within a certain ZIP code. It’s fairly simple; more claims mean higher costs while fewer claims mean lower costs. However, if you’ve ever had a car stolen, you know that higher premiums aren’t the only way consumers pay; you’ve also got insurance to cover deductibles plus incidentals, annoyances and lost time. 

Most cars equipped with anti-theft technology receive a two to ten percent discount from their insurance companies. So, if your vehicle has a car alarm, keyless entry system or a steering-wheel disabler, you should be racking in a few discounts. Better yet, if you install the LoJack vehicle recovery system or have GM’s OnStar navigation system, which helps cops to track a stolen vehicle, you can bank on a few more generous discounts.                                                         

Can’t afford a fancy car security system? No problem. Many car manufacturers are using other measures to make their vehicles less appealing to auto thieves - from tinted glass to covered storage areas and louder car alarms. Law enforcement have also been putting these thieves behind bars thank to their use of ‘bait cars;’ decoy vehicles equipped with GPS tracking, audio and video surveillance and remote engine-kill switches. Watch out car thieves! I think it’s fairly safe to say this; auto theft is a dead-end job. Literally.

Do I need Business Interruption Insurance?

Friday, April 30, 2010

Business interruption insurance can be as vital to your survival as a business as fire insurance. Most people would never consider opening a business without buying insurance to cover damage due to fire and windstorms. But too many small businessowners fail to think about how they would manage if a fire or other disaster damaged their business premises so that they were temporarily unusable. Business interruption coverage is not sold separately. It is added to a property insurance policy or included in a package policy.

A business that has to close down completely while the premises are being repaired may lose out to competitors. A quick resumption of business after a disaster is essential.

  1. Business interruption insurance compensates you for lost income if your company has to vacate the premises due to disaster-related damage that is covered under your property insurance policy, such as a fire. Business interruption insurance covers the profits you would have earned, based on your financial records, had the disaster not occurred. The policy also covers operating expenses, like electricity, that continue even though business activities have come to a temporary halt.
  2. Make sure the policy limits are sufficient to cover your company for more than a few days. After a major disaster, it can take more time than many people anticipate to get the business back on track. There is generally a 48-hour waiting period before business interruption coverage kicks in.
  3. The price of the policy is related to the risk of a fire or other disaster damaging your premises. All other things being equal, the price would probably be higher for a restaurant than a real estate agency, for example, because of the greater risk of fire. Also, a real estate agency can more easily operate out of another location.

Extra Expense Insurance

Extra expense insurance reimburses your company for a reasonable sum of money that it spends, over and above normal operating expenses, to avoid having to shut down during the restoration period. Usually, extra expenses will be paid if they help to decrease business interruption costs. In some instances, extra expense insurance alone may provide sufficient coverage, without the purchase of business interruption insurance.

What can I do if I'm having trouble settling my claim?

Wednesday, April 28, 2010

If you are unsatisfied with how your insurance company is handling your claim, you have several options:

Talk to the agent or company representative who sold you the policy 

Let the agent know that you are dissatisfied and explain the specifics of your problem. 

Contact the claims manager of the company

Provide a written explanation of your problem with copies of supporting documentation. Remember to send only a copy and not any original documentation. If you are insured with a smaller company, consider writing directly to the president. Going to the top can sometimes speed the process. 

Contact your state insurance department

Insurance is a regulated industry and your state department of insurance should be able to help you resolve your problem.

Consult an attorney

If you have tried all four of the above tips and still can’t resolve the claim, you may want to talk to an attorney. You may have to pay a consultation fee for your initial visit, so make sure you know how much this will cost. Meet with an attorney who has solid references or get the name of someone from your local bar association. Prepare for the visit by bringing a copy of your insurance policy and other relevant documents. Get the fee structure in writing before you decide to pursue the case.

What is an Annuity?

Tuesday, April 27, 2010

In its most general sense, an annuity is an agreement for one person or organization to pay another a stream or series of payments. Usually the term “annuity” relates to a contract between you and a life insurance company, but a charity or a trust can take the place of the insurance company. 

There are many categories of annuities. They can be classified by:

  • Nature of the underlying investment – fixed or variable
  • Primary purpose – accumulation or pay-out (deferred or immediate)
  • Nature of pay-out commitment – fixed periodfixed amount, orlifetime
  • Tax status – qualified or nonqualified
  • Premium payment arrangement – single premium or flexible premium

An annuity can be classified in several of these categories at once. For example, you might buy a nonqualified single premium deferred variable annuity. For brief definitions of these categories, click here

In general, annuities have the following attractive features:

  • Tax deferral on investment earnings
    Many investments are taxed year by year, but the investment earnings—capital gains and investment income—in annuities aren’t taxable until you withdraw money. This tax deferral is also true of 401(k)s and IRAs; however, unlike these products, there are no limits on the amount you can put into an annuity. Moreover, the minimum withdrawal requirements for annuities are much more liberal than they are for 401(k)s and IRAs.
  • Protection from creditors
    If you own an immediate annuity (that is, you are receiving money from an insurance company), generally the most that creditors can access is the payments as they’re made, since the money you gave the insurance company now belongs to the company. Some state statutes and court decisions also protect some or all of the payments from those annuities. And your money in tax-favored retirement plans, such as IRAs and 401(k)s, are generally protected, whether invested in an annuity or not.
  • An array of investment options, including “floors”
    Many annuity companies offer a variety of investment options. You can invest in a fixed annuity which would credit a specified interest rate, similar to a bank Certificate of Deposit (CD). If you buy a variable annuity, your money can be invested in stock or bond (or other) mutual funds. In recent years, annuity companies have created various types of “floors” that limit the extent of investment decline from an increasing reference point. For example, the annuity may offer a feature that guarantees your investment will never fall below its value on its most recent policy anniversary.
  • Tax-free transfers among investment options
    In contrast to mutual funds and other investments made with “after-tax money,” with annuities there are no tax consequences if you change how your funds are invested. This can be particularly valuable if you are using a strategy called “rebalancing,” which is recommended by many financial advisors. Under rebalancing, you shift your investments periodically to return them to the proportions that you determine represent the risk/return combination most appropriate for your situation.
  • Lifetime income
    A lifetime immediate annuity converts an investment into a stream of payments that last as long as you do. In concept, the payments come from three “pockets”: Your investment, investment earnings and money from a pool of people in your group who do not live as long as actuarial tables forecast. It’s the pooling that’s unique to annuities, and it’s what enables annuity companies to be able to guarantee you a lifetime income.
  • Benefits to your heirs
    There is a common misconception about annuities that goes like this: if you start an immediate lifetime annuity and die soon after that, the insurance company keeps all of your investment in the annuity. That can happen, but it doesn’t have to. To prevent it, buy a “guaranteed period” with the immediate annuity. A guaranteed period commits the insurance company to continue payments after you die to one or more beneficiaries you designate; the payments continue to the end of the stated guaranteed period—usually 10 or 20 years (measured from when you started receiving the annuity payments). Moreover, annuity benefits that pass to beneficiaries don’t go through probate and aren’t governed by your will.

What is in a basic insurance policy?

Thursday, April 22, 2010

Your auto policy may include six coverages. Each coverage is priced separately.

1. Bodily Injury Liability

This coverage applies to injuries that you, the designated driver or policyholder, cause to someone else. You and family members listed on the policy are also covered when driving someone else’s car with their permission.

It’s very important to have enough liability insurance, because if you are involved in a serious accident, you may be sued for a large sum of money. Definitely consider buying more than the state-required minimum to protect assets such as your home and savings.

2. Medical Payments or Personal Injury Protection (PIP)

This coverage pays for the treatment of injuries to the driver and passengers of the policyholder's car. At its broadest, PIP can cover medical payments, lost wages and the cost of replacing services normally performed by someone injured in an auto accident. It may also cover funeral costs.

3. Property Damage Liability

This coverage pays for damage you (or someone driving the car with your permission) may cause to someone else's property. Usually, this means damage to someone else’s car, but it also includes damage to lamp posts, telephone poles, fences, buildings or other structures your car hit.

4. Collision

This coverage pays for damage to your car resulting from a collision with another car, object or as a result of flipping over. It also covers damage caused by potholes. Collision coverage is generally sold with a deductible of $250 to $1,000—the higher your deductible, the lower your premium. Even if you are at fault for the accident, your collision coverage will reimburse you for the costs of repairing your car, minus the deductible. If you're not at fault, your insurance company may try to recover the amount they paid you from the other driver’s insurance company. If they are successful, you'll also be reimbursed for the deductible.

5. Comprehensive

This coverage reimburses you for loss due to theft or damage caused by something other than a collision with another car or object, such as fire, falling objects, missiles, explosion, earthquake, windstorm, hail, flood, vandalism, riot, or contact with animals such as birds or deer.

Comprehensive insurance is usually sold with a $100 to $300 deductible, though you may want to opt for a higher deductible as a way of lowering your premium.

Comprehensive insurance will also reimburse you if your windshield is cracked or shattered. Some companies offer glass coverage with or without a deductible.

6. Uninsured and Underinsured Motorist Coverage

This coverage will reimburse you, a member of your family, or a designated driver if one of you is hit by an uninsured or hit-and-run driver.

Underinsured motorist coverage comes into play when an at-fault driver has insufficient insurance to pay for your total loss. This coverage will also protect you if you are hit as a pedestrian.

If You Have a Pet, Advanced Evacuation Planning Is Key When Preparing for a Hurricane

Tuesday, April 20, 2010

All too often when disaster strikes pets are left to fend for themselves and end up lost, injured or are even killed. Making your pets a part of your family disaster preparedness plan is an essential step toward ensuring their safety, according to the Insurance Information Institute (I.I.I.).

“Planning for a disaster is the best way to survive one. In addition to keeping your insurance up-to-date and having important papers ready to go, if you are a pet owner, you should make plans for your animal friends when creating an evacuation plan," said Jeanne Salvatore, senior vice president and consumer spokesperson for the I.I.I. “In a disaster, no one should have to decide between their life and that of a beloved pet.”

The I.I.I. offers the following tips for protecting your pets during a disaster.


Most of the public shelters that are set up for disaster victims will not accept animals other than service animals, so make sure you have lined up somewhere for your pet to stay.

  • Contact hotels and motels outside your immediate area to check their policies on accepting pets.
  • Make a list of boarding facilities and veterinarians outside your area that might be able to shelter your pets in an emergency. Include emergency phone numbers.
  • Ask your local humane society or emergency management agency for information regarding community disaster response plans that include pets.In the event you are not home when disaster strikes, make advance arrangements to have a friend or neighbor pick up your pets and meet you at a specified location.


Just as you have a disaster kit for your family, you should prepare a similar kit for your pets containing:

  • Medication and medical records (including proof of rabies vaccination) in a waterproof container.
  • Leashes, harnesses and carriers for transporting pets.
  • A muzzle, if your pet requires one.
  • Food and water for three days; a manual can opener.
  • Cat litter and litter box.
  • Current photo and description of your pet in case you become separated.
  • Name and phone number of your veterinarian.
  • If you have pet insurance, the insurance company contact information and policy number.


  • Be prepared to leave early; don't wait for an official evacuation as you might be ordered to leave your pets behind.
  • Keep pets on leashes or in carriers at all times.
  • Make sure your pet is wearing up-to-date identification. Include the phone number of a friend or relative outside your area in case your pet gets lost and you cannot be reached.
  • Birds should be transported in a secure travel cage or carrier. During warm weather, carry a plant mister to mist the bird's feathers periodically. Do not put water inside the carrier during transport; instead provide a few slices of fresh fruit or vegetables with high water content.


  • Once you return to your home, don't allow your pets to roam loose right away. While you assess the damage, keep dogs on a leash and other animals in their carriers.
  • Familiar landmarks and smells might be gone, and your pet may become disoriented. Pets can easily get lost in such situations, so give them some time to get used to their “new” surroundings.
  • Be patient. Try to get your pets back into their normal routines as soon as possible, and be on the lookout for stress-related behavioral problems; if these persist, talk to your veterinarian.

To learn more about protecting your pets during a disaster, visit the Humane Society of the United States; the American Red Cross; and the Federal Emergency Management Agency.

For related videos and podcasts, go to Evacuation: The Ten Minute Challenge and Evacuation (Podcast).

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