Is your home OVERinsured?

“Your life is not stagnant, therefore, your insurance shouldn’t be either.”

Of course we are always more concerned if we are underinsured, it’s always the question you ask yourself. Do I have enough insurance? Will I be covered in the event of a loss? What happens if I make a claim?

These are all important questions, even more important is to be given the correct answers.

What homeowners don’t know is that their homeowners insurance policies need to be evaluated annually. Without doing so your home could currently be UNDERinsured, and believe it or not, OVERinsured.

Properties are evaluated for a “reconstruction cost” or “replacement cost” valuation which in basic terms: is the cost to rebuild your home based on cost of material (boards, nails, shingles, etc.) and labor. This coverage is a dollar amount listed on your homeowners declaration page. This amount is referred to as Dwelling Coverage and/or sometimes Coverage A.

This amount is not always determined properly. I’ve seen countless declaration pages that are tens of thousands of dollars undervalued. I have also seen many who are tens of thousands OVER valued. I’ll tell you how this happens.

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Under Valuation

When your homeowners policy is not adequately insuring the replacement cost or reconstruction cost of your home there are many factors that could have led to this. One, and the one I see more prevalently, is that your home was insured during the sale/escrow for the market valuation. Market value is the estimated price at which your property would be sold on the open market between a willing buyer and a willing seller under all conditions for a fair sale [1] Market value is not an accurate representation of what your home should be insured for.

  1. Market value has nothing to do with the actual cost it would take to rebuild your home.
  2. Market value fluctuates throughout the year, and is based on supply and demand, along with comps in your area.

As you can see, market value has no bearing, whatsoever, on the cost associated to reconstruct your home. Yet, so many insured’s properties are covered for the market value, not the reconstruction cost.

Perhaps you purchased your home during a “buyers” market, and your insurance company has you valued for market value. Your coverage amount may need to be re-evaluated. If these things aren’t regularly looked at you could end up with a partial or total loss of your home and not have adequate funds to reconstruct your investment/home.

Over Evaluation

Yes, this is an issue to. From time-to-time you can find homeowners policies that have overvalued the cost to reconstruct your home. When I determine the reconstruction cost of a property I use a valuation system that takes into consideration every aspect of your property. This includes information from, what type of roof you have, the size of your kitchen, whether you have upgraded rooms or not, the percentage of carpeting, to tile, to hardwood flooring, etc. I then review the average dollar per square foot it costs to reconstruct property within your zip code/area. Based on these two valuations I develop a median, which is what I insure my properties at. This gives an accurate representation of where your property valuation on a reconstruction/replacement cost basis should be.

You don’t need to be paying for coverage you don’t need. If your home doesn’t take $400,000 to rebuild, then you don’t need $400,000 in dwelling coverage.

Vice versa, if your property requires $400,000 in Dwelling coverage and you currently have $320,000 you’re looking at ending up with a severely smaller house if you have a total loss of your home.

On average, based upon a home located within a mid-range residential area a 2,000 square foot home should be insured from anywhere between $360,000-$400,000 (Please note, this is a rough approximation, and does not take into consideration specialty systems).

A 1,500 square foot home is in the range of $270,000-$300,000 (Please note, this is a rough approximation, and does not take into consideration specialty systems).

How we fix this…

We take steps to accurately evaluate each and every property to guarantee proper coverage is put into place to protect you and your family. My agency is concerned for the well-being of you and your family and we take pride in knowing that your coverage will restore you to the place you were prior to a claim/loss.

My agency performs annual, if not biannual reviews of all my client’s policies. We review all figures, coverages, and confirm that everything is still relevant, and make changes as necessary. Your life is not stagnant, therefore, your insurance shouldn’t be either.

Liar, liar, pants on fire…


With the mass majority of us utilizing social media like Facebook, Instagram, Twitter, and various blogging websites the chances of saying something that either offends or defames another person are likely. These types of lawsuits are referred to as libel, meaning defamation created by written word.

There has been a significant amount of lawsuits founded off of Facebook posts that individuals found offensive or degrading to them personally. Perhaps it was purposeful, perhaps not.

We do have freedom of speech in our country, however, defaming individuals and causing personal loss to them due to a statement can be grounds for lawsuits.

Most would have to cover the costs for attorneys out-of-pocket, but Farmers clients have the option of having “Personal Injury” protection endorsed on their homeowners policies. Personal injury covers you during defamation of character, libel and slander claims made against you. This coverage costs on average $3-8/ a YEAR.

Face it, were humans and with being humans we aren’t always perfect. Social media is a two dimensional form of communication and without voice, body language and actual face-to-face contact comments can be misconstrued or misrepresented. Don’t find yourself uninsured, when you found yourself misunderstood.

Call me today and let’s talk about your options, don’t risk thousands if not tens of thousands of costs related to a lawsuit because you didn’t call to discuss coverage.

John F. Kennedy

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On This Day in History!

On March 1, 1961 newly elected John F. Kennedy issued an executive order establishing the Peace Corps on a trial status.

President Kennedy’s intent was to have volunteers from our country to travel to underdeveloped countries and support the people of those nations who were “struggling for economic and social progress.” [1]

“Our own freedom,” Kennedy continued, “and the future of freedom around the world, depend, in a very real sense, on their ability to build growing and independent nations where men can live in dignity, liberated from the bonds of hunger, ignorance, and poverty.” [2]

During the 1960’s and 1970’s thousands of Americans served in dozens of underdeveloped countries. The majority of these countries included: Latin America, Africa, Asia, and the Middle East. Working with the people of these nations, Peace Corp helped build sewer, water systems, they helped teach in schools, helped the people develop new crops and agricultural methods to yield higher production to support their country.

Today

220,000 Americans have served in the Peace Corp to date, they have helped 141 host countries, they currently have 6,919 volunteers and trainees, and are currently in 63 host countries.

Did You Know?

“• In March 2015, President Barack Obama and First
Lady Michelle Obama, along with the Peace Corps
and other federal agencies, launched Let Girls
Learn, a collaboration to promote education and
empowerment for girls worldwide. In the first nine
months, the effort had already inspired 105 projects by
Peace Corps Volunteers in 32 countries, from building
libraries to hosting technology camps, and enabled
new training for 700 Volunteers to date.

• In 2015, more than 23,000 people applied to be
Peace Corps Volunteers—a 40-year high. The record
came a year after the agency implemented historic
application and recruitment reforms, including the
option to choose your country of service and program
area, and shortening the application so it can be
completed in under an hour.

• The Peace Corps Prep program, which prepares
college students for international development
work, now boasts 39 college and university partners.
Founded in 2007, the Peace Corps Prep curriculum
combines undergraduate coursework, foreign
language study, and community engagement.
• In 2015, the Peace Corps expanded the innovative
Global Health Service Partnership to four countries,
working in conjunction with partners Seed Global
Health and PEPFAR, to increase training for doctors
and nurses abroad.” [3]

Things to do for Spring!

Spring is around the corner! Well, that’s what they say anyways…from the amount of rainfall we continue to have, I’m not sure if I believe them! Nevertheless, the season will come soon enough…

It’s time we start putting together our list of “Things-To-Do” for when the weather gets, well, less wet…

The high winds and heavy rain this winter have left a lot blown down fences, blown off roof shingles, yards full of leaves and other debris…and hopefully little to no water damage to your home and property.

It’s time we start compiling a list of things to fix, upgrade, or just nice/fun projects to improve your home.

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Here is a small list I’ve comprised for you to give you a jumpstart!

Spring Cleaning

 

Inside:

  1. Change your air filters
  2. Clean any mold in bathrooms from condensation and replace fans/exhausts if needed
  3. Replace any cracked caulk in showers, windows, etc.
  4. Check that your air conditioner is in good working order
  5. Check that all emergency systems: smoke alarm, carbon monoxide, etc. are in working order.

Outside:

  1. Check/repair your fences
  2. Inspect your roof for loose/worn/lost shingles or tiles
  3. Inspect for any water damage
  4. Clean yard
  5. Remove any trees that are dead or sick
  6. Replant trees/flowers, etc.
  7. Replace any cracked caulk in roof of trailers/motorhomes, etc
  8. Power wash sidewalks/patios

 

This is just a list to spark ideas and make sure some of the necessities get taken care of. Spring is a beautiful time, and it’s nice to get outside and enjoy it.

On an important note! As our homes age, they need some TLC. After storms, and the winter we’ve had our neglected properties could use some good ‘ole tender loving care.

This spring should bring beautiful flowers and green grass, lets enjoy the beauty and add a little to our lives.

 

 

Pets are family too!

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“…your auto insurance may not cover injuries your pets endure due to an automobile accident…”

 

I’m an animal lover. I’ve had birds, cats, and dogs throughout my life. They are family. I currently have a lab, two toy fox terriers, and two boston terriers. I take them pretty much everywhere. I’ve flown on airplanes with them (in the cabin with me), they go camping, and four wheeling with me. They travel to the snow and run and play with other canine friends. I’ve taken them to the ocean, to the dessert, to different states, and have traveled in long car rides with them (over a 1,000 miles). My pups, are my family, and I care about protecting them as I would any two legged family member.

Farmers offers Pet Insurance through Pets Best. There are a multitude of options that can help with expenses acquired from vet bills due to accident/illnesses, to routine vet visits. For as little as $9/month you can rely on a policy to help with the unexpected and sometimes large veterinary costs. When your four legged family member gets sick or injured the last thing you want to be concerned about is cost. So why not have insurance to help with the financial burden.

You can’t always sock away enough cash to help pay for unexpected vet bills, Pets Best insurance helps alleviate the burden of the unexpected.

On another note, were you aware that your auto insurance may not cover injuries your pets endure due to an automobile accident?

Well, Farmers does!

How often does your pet ride in your car with you? I know mine do weekly, and I love that my fur babies are protected too.

“Household Pet coverage has been automatically included in the new California Personal Auto Policy, which provides coverage for household pet losses or injuries during comprehensive or collision losses.” – Farmers SPA

If you’d like to discuss your options, and what’s best for your pet, call me. We can find a plan that suits your pocket book, as well as protecting your four legged family member.

Your pet’s health is important too!

 

What’s your life worth?

“Driving in your car everyday without the proper coverage is the same thing as driving around with a trunk full of cash. When you get hit, money will start flying…”

Over 30,000 people killed in crashes every year in the United States (cdc.gov)
Top 10 cause of death among people ages 1-54.
In 2013 deaths from car accidents resulted in $44 BILLION in medical and work loss costs.

Automobile crashes result in big $$. The judgments are comprised of the victim’s loss wages, medical bills, and pain and suffering.

Who pays for this, your insurance does. But, not over your coverage limits. In 2013 $996 million was given to victims of car accidents who were occupants in the vehicle, another $677 million to motorcyclists, $997 million to pedestrians, and $222 million to bicyclist.

Auto accidents in California are more prevalent than any of other state in our region. We had 3 times more crash-related deaths in 2013 than Arizona, and 12 times more than Nevada.

If you only have state minimum requirements on your auto insurance (which is $15,000 in liability coverage for bodily injury and uninsured motorist), who do you think is going to be liable for everything over the $15,000?

YOU

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Becoming safer drivers is always key to decreasing your risk on the road, and decreasing your financial liability. However, there are situations outside of your control, in these times, or in times of accidents you need to rely on your insurance.

Do you feel confident that your insurance would handle 100% of the judgment if you caused injury to another person with your vehicle?

Because if you don’t, you could lose your house (California state law designates that an injured party in a motor vehicle accident who is innocent is due damages by the guilty party and your home, your 401K, your pension plan and 25% of your income can be garnished or taken from you). In some situations you only have to be 1% at fault to lose EVERYTHING you ever worked hard for.

In California 40% of all accidents are caused by individuals WITHOUT insurance, another 40% are caused by individuals with state minimum coverage. Which means, good drivers and responsible drivers have an 80% likelihood of being hit by someone who does not have the proper (if any) insurance to take care of their medical bills, lost wages, and pain and suffering.

If this was you, and you were injured in an accident by an uninsured motorist, would your policy pay enough to handle your medical bills, pay for your lost wages and income, cover your mortgage so you and your family don’t lose your home, what if you need handicap accessibility at your home? Would your insurance cover you for that? Most policies I review wouldn’t. 99% of customers that come to me seeking advice do not have coverage that would take care of them in the event of an accident. Most have such decreased coverage that their homes, income, and everything they have worked so hard for are at jeopardy.

Insurance is not standardized, one policy does not fit every person, it is not a cookie-cutter-process, and if you are looking for the cheapest insurance over quality and coverage then you are putting a price on your own livelihood.

There are ways to make insurance affordable without having to have low liability limits. However, to do this, you need to discuss options with a professional.

Ask yourself these three simple questions:

  1. Would you seek medical assistance from the internet?
  2. Would you seek legal help from an online legal chatroom?
  3. Would you invest your money over the internet without speaking to a financial advisor?

If the answers to any of the above are “No”, then find an insurance advocate that you can trust and go over your options. Insurance is just as vital as your attorney or financial advisor. For the simple reason that if you face a claim, or lawsuit who is going to pay for the damages? Most likely not the attorney…you need an advocate that can work with you and for you to protect your life.

There are options for you that will protect you, your family, your assets, and future without gouging your pocket-book. Better yet, it’ll give you peace of mind and security.

Driving in your car everyday without the proper coverage is the same thing as driving around with a trunk full of cash. When you get hit, money will start flying…

 

Don’t tell me your family isn’t worth the cost of coffee…

It’s true! It can be as little as your monthly cost of coffee…

life in·sur·ance
ˈlīf inˌSHo͝orəns/
noun
noun: life insurance
  1. insurance that pays out a sum of money either on the death of the insured person or after a set period.
Auto insurance and health insurance are mandatory policies every household must have. However, would you deny that they are necessary?
While life insurance isn’t mandatory, how do you feel about it? Do you think it’s important?
1. Do you have debt?
2. Do you have property?
3. Do you have family that you love?
4. Would loved ones be financially strapped if you weren’t here tomorrow?
If you answered “yes” to even one of the above you should have life insurance. Life insurance is mortgage protection, it is family protection. Life insurance is what continues protecting your family, long after you can’t.
It’s not a fun subject, but it is a necessary one.
Now, for the good stuff! Life insurance can actually EARN you $$$. There are options for life insurance that actually accrue up to a 12% interest rate, inevitably growing your money for your retirement. (Better yet, its not taxed $$)
Oh! The good continues, life insurance can save you money on your monthly auto insurance expenses.
PLUS, there are so many options available. There are even policies that can cost you less than your monthly coffee bill. Ask yourself this, is your family’s well-being and security worth the cost of a cup of joe? If the answer is yes, then we need to talk about options and find a policy that is practical for you.
I know your family wants you with them, life is unpredictable, and the most you can do for them is make sure you leave them with a peace of mind.
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