Home Maintenance Tips

Home Maintenance

Home Maintenance

At this time of year many people perform their “spring clean”, when they go through the house and make sure everything is clean from roof to floor. Now is a great time to also perform some basic preventative maintenance on you house, and address any issues which may damage your home and cause you to eventually make an insurance claim.

There are actually many insurance claims that can be avoided by using preventative measures, thinking ahead and identifying potential problems early on. Here is a list of the easiest preventative measures that you could incorporate into your spring clean to save you a lot of money!

Check your yard for any trees or shrubs that are getting out of control
Anything that might knock against the wall or windows should be trimmed back. This will also help prevent mold problems in your home and prevent damage to the building during storms.

Check the batteries in your smoke alarms
Make sure all of your smoke alarms are functioning correctly and change the batteries if you need to. Use this time to consider buying more smoke alarms, which can not only save your home from destruction, but can save your life.

Wash the outside of your house
Hire or buy a pressure washer and wash the exterior of your home to remove dirt and mold. Check for any damage to the house while you do it and check the condition of the paint. If you have a timber home, look for any split timber or water damage to the exterior which can grow to be a problem.

Wash the inside of you house
Wash the walls, paying close attention to any indications of mold or dry rot. If you notice a mold problem, chances are there is an issue with your roof, drainage or cracks in your concrete, letting water into the structure of the house. The sooner you spot that, the better.

Clean your gutters
Clean out any leaf litter in your gutters and make sure the guttering is still in good condition. Make sure there is no evidence of water building up in the gutters, or corrosion. Check that the downpipes are draining correctly and that the water isn’t winding up in the basement.

Check the condition of the roof
Look for cracked tiles, loose tiles or damage of any kind to the roof. Eventually your roof might have to be replace, but with some simple maintenance you can avoid a common insurance claim that people make when their roof leaks.

Check the concrete around the house and in the basement
Look for any cracks or damage that indicates the house is moving. These cracks could be responsible for water damage and any issues need to be detected as early as possible. Check the basement for any problems and fill them with a concrete or silicon crack filler.

Clean your carpets
Hire an industrial strength steam cleaner and clean the carpets. It can help reduce any mold problems and make your house much healthier, reducing the chance of health insurance claims.

Clean ceiling fans
Check the condition of your ceiling fans. Again, removing mold and dust is beneficial for your families health and can reduce the risk of health or household insurance claims.

Umbrella Insurance Explained

Umbrella Insurance

Umbrella Insurance

Umbrella Insurance is a form of liability insurance that will protect your assets and income in addition to any primary insurance policies you may have. That means that it provides cover additional to any property, automobile or watercraft policies you might have. Liability insurance is the portion of the insurance policy that covers for expenses associated with any injured parties and pays for their medical bills, rehabilitation and lost wages.

The term umbrella refers to the fact that the insurance covers all of your assets and income where other policies alone might not provide enough cover – it provides additional cover to all of the policies underneath it. It is different to “excess” insurance because it does not require that all other policies be exhausted before coming into effect.

Usually umbrella insurance is sold in increments of 1 million dollars. As an example of how other insurance policies with with it, if you had an automobile insurance policies which had a liability limit of $300’000, with the umbrella insurance, your total coverage is $1’300’000. If you had a home insurance policy with limits of $500’000, with the umbrella insurance policy it would become $1’500’000.

With some insurance policies, you might not be entirely covered if you acted in a way that voided the policy, but umbrella insurance will often provide coverage. So if you are involved in a automobile accident, and for some reason your primary insurance provider refuses to pay out, you still have $1 million of coverage from the umbrella policy.

In addition, umbrella insurance is particularly useful because our society is so litigious now, and any automobile accident or incident involving your home can turn into a large lawsuit. If you are sued for $1 million dollars and your automobile policy will only payout $300’000, then umbrella insurance can be used to cover the remainder.

The umbrella insurance coverage will provide for legal representation if the matter goes to court. Once you combine an injured person’s medical bills and any legal action they might take, it’s quickly apparent that the standard automobile insurance or household insurance does not include enough liability insurance.

In nearly every state of the United States, there are laws that hold drivers responsible for all bodily injury and property damage should they be at fault, so the risk is very real that you could lose everything without sufficient insurance.

Examining Funeral Insurance

Funeral Insurance

Funeral Insurance

It’s often difficult to think about your own mortality and the people you are leaving behind. However if you think about those you are leaving behind for a moment, it’s much easier to get motivated and prepare for your own passing. Will your family be able to afford the various funeral expense, will they struggle to pay the expenses your passing will incur or are they financially secure? When you do pass away your family will be under enough stress mourning their loss, so adding a financial burden is a concern that many people wish to avoid.

Many older people have decided that they don’t want to place any additional financial stress on their family so have opted for a funeral insurance product. Funeral insurance is a payment that occurs on your passing to pay for funeral related expenses such as the cost if a casket or internment, and any related ceremonies.

This article will examine the risks and benefits of obtaining a funeral insurance policy, highlighting what you should be looking for in a policy to obtain value for money and examining if funeral insurance is good value for money at all.

Funeral Insurance is actually a very old form of insurance that can be traced back to ancient Greece when guilds called “benevolent societies” cared for surviving relatives and paid a death benefit to the family. The tradition went on in the middle ages and Victorian times with “friendly societies” taking up the cause.

In modern times, funeral insurance has been a part of many life insurance policies, adding sufficient compensation to cover the cost of the funeral in the life insurance payout. In recent years, companies have started heavily promoting funeral insurance as a separate policy at a substantially reduced price compared to life insurance, and with different eligibility requirements so older people could obtain it. Funeral insurance also pays out much quicker than many life insurance policies, which need sometimes need to establish cause of death before paying.

Before you buy into a funeral insurance policy you have to consider the value for money you receive. Under some funeral insurance plans you can end up paying more in premiums than the value of the cover, so you might pay $10’000 in premiums for a $5000 funeral eventually. Based on the average life expectancy, economists have calculated that taking out funeral insurance at the age of 65, your premiums will be much higher than the value of the insurance by the time you are 91. So you should think about your family history and current health situation before jumping into a policy.

With most insurance policies, you will only pay funeral insurance until age 90, then coverage becomes free. Most Funeral insurance premiums will be more expensive the older you are, so it’s inexpensive when you are 25 but much more expensive when you are 72. Some policies have fixed premiums for the entire duration of the policy.

It really pays to read the fine print of insurance policies because they can vary a great deal in regards to other specifics. With many policies the benefit amount increases over time but some have a fixed benefit throughout the entire policy. Some policies have a restriction on accidental death in the first couple of years of the policy. Some polcies are more expensive if you are a smoker or more expensive if you are a male (because they die earlier than females).

Instead of a funeral insurance policy (or in conjunction with one), there are other ways to cover funeral expenses that should be considered:

Prepaid Funerals will pay for a part or all of the funeral costs, at todays prices. That means if it costs $5000 to bury you today, despite possibly costing more in the future, you are still covered. There are a number of ways to pay for a prepaid funeral:

  • Pre-purchased funeral items: you pay for small parts of the funeral individually. Buy a tombstone first, then buy a plot and so on.
  • Contributory Funds: you make small regular payments that add up over time and contribute to the cost of your funeral, this may be a partial payment
  • Prepaid Funerals: You choose the specifics of your funeral and make small payments over time

Funeral Bonds are also offered by insurance companies and some friendly societies. You can make a lump sum payment or pay by installments and the money is invested, to be paid out when you pass away. It cannot be accessed for any other purpose and can only be paid to the name you specify.

Life Insurance may also be an option instead of funeral insurance, depending on your age and ability to qualify. It will be more expensive than life insurance but if it is not cost prohibitive it can be of great benefit to a family after your death.

Doing the sums

So how does funeral insurance come up against these other options? Well it will largely depend on the specifics of the policy and your personal details. Taking a run of the mill funeral insurance policy with an increasing premium and payout, if you are aged 65 when you take out a policy for $6000 of funeral insurance (numbers rough estimate):

  • If you die at 66 you will have paid $500 in premiums and will be paid $6000 by insurance (roughly +$5500 difference)
  • If you die at 71 you will have paid $3830 in premiums and will be paid $7600 by insurance (roughly +$3800 difference)
  • If you die at 76 you will have paid $9560 in premiums and will be paid $9770 by insurance (roughly +$200 difference)
  • If you die at 81 you will have paid $20,300 in premiums and will be paid $12,400 by insurance (roughly -$7840 difference)
  • If you die at 86 you will have paid $40,900 in premiums and will be paid $15,900 by insurance (roughly -$25,000 difference)

So as you can see, there quickly approaches a point where funeral insurance is not providing good value for money compared to other methods for paying for your funeral.  If you consider yourself somewhat healthy and have a good family history of long living it may be wise to consider other methods for covering funeral expenses.

Marine Insurance in Detail

Maritime Insurance

Maritime Insurance

Marine Insurance is insurance aimed at protecting everything associated with shipping on local and international waterways. That includes insuring the ships themselves, the cargo, the shipping terminals, and all of the infrastructure involved in shipping property from origin to destination.

Cargo insurance is considered to be a part of marine insurance and is fairly detailed itself because of all of the logistics and possible risks involved in transporting cargo.

Marine Insurance can actually be traced all the way back to the ancient Romans with historians finding evidence of a maritime loan which was payable should a vessel not return to port. Risks to vessels at that time ranged from weather scuttling the ship, to pirates, to mechanical issues on the ship and even mutiny! In modern times, some of these issues are less likely but entirely possible. In modern times, maritime insurance developed in England where laws were developed to guide maritime insurance including the 1906 Maritime Insurance Act.

Maritime insurance covers a number of problems and accidents that can involve a ship. Maritime Insurance includes various types of collision damage such as collision with other ships, collision within harbors involving damage to infrastructure, collision with natural hazards like reefs and wreck removal. The wreck removal protection is particularly important because after an incident in a harbor, often the wreck needs to be removed immediately so normal shipping can continue.

Most maritime insurance policies only cover 75% of the insured parties liabilities in these circumstances, so many ships are required to purchase additional insurance to cover the remaining 25%.

Two important terms in maritime insurance are “total loss” and “constructive total loss”. Total loss refers to an incident where damages or repair costs exceed the value of the property. For example when a ship is involved in the collision and it is less expensive to buy a new ship rather than repair it. A constructive total loss refers to a situation where the repair cost and the salvage cost combined equal or exceed the value. The terms rely on the ship still being available to ascertain damages. In some situations the ship may have completely sunk.

There are additional specialist policies available under the maritime umbrella.

Increased Value insurance will add additional coverage to protect against the loss of ships which are worth more now than they were originally.

War Risk Insurance is more expensive and covers ships entering into territories that the Joint War Committee consider involved in a war. An example of this would be ships that enter the Persian Gulf during the Iraq War.

New Building Insurance covers damage to the hull while the ship is being constructed. If there is an accident in the shipyard that severely damages the hull this extension to normal maritime insurance will be required.

Cargo Insurance is available at a number of different levels, classified as A, B or C cargo coverage. C is the most limited and A is the most comprehensive. Additionally special clauses are required for certain kinds of cargo, like oil, coal, frozen food and meat. There are additional risks involved in transporting that kind of cargo and as a result, higher premiums.

Term Life Insurance in Detail

Term Life Insurance

Term Life Insurance

The Term Life Insurance policy is one of the most common types of insurance policies in the market. It is a life insurance policy that provides coverage for a fixed term at a fixed rate of payments. So you can obtain a policy agreement for a certain number of years at a fixed cost.

After that fixed period expires, the coverage expires and the insured party must reapply for coverage and must renegotiate the rate of premiums. If the insured party dies during the term of the life insurance policy, a payout is given to the beneficiaries of the policy.

Term Life was the original type of Life Insurance available for sale. Nowadays you can obtain other variations of life insurance including permanent life insurance policies like whole life insurance and variable universal life insurance. Those forms of policies extend over your entire life and have established premiums over that entire period. In contrast, term life insurance providers can refuse to renew your policy once you reach a certain age or have a certain type of illness occur.

Term life insurance is most often used as a income replacement strategy, so when the insured party dies, the income that would have been provided throughout their working life is covered by the insured amount. It is useful to insure the bread winner of the household, so if they pass away, the family has enough money to pay off their mortgage and cover living expenses. Other costs that the insurance might need to cover include car repayments, college debt, funeral costs and the ongoing costs associated with dependents.

The smallest amount of term life insurance provided by most companies is a single year. The level of premium is based on the probability of the insured party dying in the time period.

Providing proof of insurability

There are various restrictions as to the people that insurance companies will accept as term life insurance policy holders. You will have to demonstrate your “insurability”. For example, if you had a serious terminal illness which meant you had a high chance of dying within the next year, the insurance company would not accept your application.

You will have to see a doctor to determine if you are an eligible candidate for term life insurance. However some term life policies guarantee insurability after your first policy. That means that if you have a 10 year term life insurance policy, they will automatically allow you to renew the policy regardless of medical condition. However, even that sometimes has limitations, so they might accept you even if a medical doctor has diagnosed you with heart disease, but they won’t accept you back if you have terminal cancer.

Annual Renewable Term
Even though the policies can sometimes stretch over many years, most insurance companies allow you to pay for it on a yearly basis, the “annual renewable term”. Even though you are paying on a yearly basis, the length of the policy could be as long as 10 or 20 or 30 years. However with this kind of term, the cost of premiums can rise each year as you get older.

That is in contrast with level term life insurance, which has fixed premiums over the entire length of the policy. So even a 30 year policy with have the same level of premiums (adjusted for inflation) every year. With level term life insurance, the cost of premiums is higher in year one compared to an annual renewable term policy, however you know that premiums won’t significantly rise as you get older.

Most level term insurance policies also allow you to extend the policy at a set rate if the initial policy expires. Some long term policies give you the option to convert the policy into a “whole life policy” or “universal life policy”.

All forms of life insurance use mortality tables to calculate the cost of your insurance. The payouts from life insurance are considered death benefits, so are income tax free.

Cheaper Home Insurance Premiums

Home Insurance

Home Insurance

In recent years the number of natural catastrophes that have occurred world wide has increased. Some scientists suggest that this is due to increasing global temperatures and related climate change. Whatever the cause, it has had a dramatic effect on the cost of insurance premiums as more natural disasters occur.

Everyone wants to make sure that their home is covered by insurance that handles natural disaster incidents but it is increasingly difficult to do so with high premiums. Fortunately there are a number of ways to obtain insurance for natural disasters and lower the cost of premiums.

A lot of people simply choose an insurance policy from the Internet and hope that it covers all of the natural disasters appropriately. Others just walk into an insurance agency and hope that the insurance agent gives them the right insurance at a good price. Unfortunately you may not get the best deal and may not have the most comprehensive cover against natural disasters. You need to scrutinize the policy in it’s entirety and look at ways you can lower the premium.

One way to save on premiums is prepare your home for natural disasters. If your local area experiences a lot of storms, you could install measures which prevent damage, like storm shutters. Then you could find an insurer that gives you a discount on your premium for having those shutters installed. In the long run the money saved is substantial. You can also install security devices or get a dog to save money on your home insurance as it reduces the chances that your home will be burgled.

You can also combine, or consolidate your insurance policies. You can obtain a discount on your insurance costs if you combine policies, so get you car insurance, home insurance and life insurance through the same company. Discuss a discount with the insurance company directly or ask your insurance agent to negotiate on your behalf.

It’s also a great idea to exclude the value of your land from any insurance policies. Natural disasters won’t affect the land (unless you have a property built very close to the coastline). So if the insurance company asks you for the value of your property, just include the price of rebuilding the home and the value of the contents of the home.

By using these three simple tips, you can save a great deal of money on the cost of insurance in the long term. With the increase in natural disasters it’s more important than ever to have sufficient insurance.