Monday, September 7, 2009

Insurance Is a Contact Sport

Fall is here and football is back! However, football is not the only contact sport this time of year. Many people have experienced summer storm damage resulting in insurance claims.

Remember, insurance, like football, can be a contact sport or, at least, an extremely adversarial endeavor.

Your insurance company does not want to pay full value for claims. You have a contract with your insurance company and you are entitled to everything that contract provides. This is a great time to go through your insurance policy and, if you're involved in an insurance claim, make sure you're getting everything you're entitled to. has a number of free podcasts which can help you get the most from your insurance claim. Ultimately, it is your responsibility to take charge of your claim. Take the time to educate yourself and be aggressive! Good luck!

Monday, August 10, 2009

Paper Trails

A recent employment article on protecting employee rights raised an interesting question. How do you protect yourself when dealing with big businesses? The best way is to think like a big business.

Insurance companies keep a paper or electronic trail of every transaction, claim, complaint or communication with their customers. If you have an insurance claim, you need to do the same thing. From the very beginning of your claim, record every communication.

It is especially important to keep notes regarding telephone conversations with insurance company adjusters or employees. Keeping good notes also helps you establish a timeline in the event you ever need to seek legal help with your claim.

Your insurance company has a duty to resolve your claim both fairly and quickly. Sadly, this rarely happens. By keeping good notes and establishing a timeline you can prove that any delays in the claim process were caused by the company, not you.

Finally, if you ever have to file a complaint with your state Department of Insurance to protect your rights, your notes will be invaluable. Remember, insurance is a business and you need to work to protect your rights. A little bit of knowledge goes a long way.

Friday, July 24, 2009

Depreciation Traps

Insurance companies love depreciation.
Depreciation is a loss of value to property because of age or obsolescence. In order for something to depreciate, it must actually lose value over time. Things like paint, roofs, fences and siding all depreciate. How much depends on how well you keep your property.
Insurance companies will pay damage to your property based on a depreciated amount. For instance, if you have a roof with a 20 year lifespan in a storm destroys it when it's 10 years old your insurance company will only pay you 50% of the value of the roof.
Sounds reasonable. It rarely is. If your property is well-maintained your depreciation is probably a fraction of what your insurance company wants to charge you. Also, insurance companies depreciate things such as demolition, debris removal and furniture moving on a regular basis. These are services which cannot be depreciated.
If you have a property loss, carefully review your insurance companies estimate of damages. Challenge any depreciation you think is unfair. Insurance companies save millions of dollars by wrongfully depreciating just about everything. Remember, never except the first estimate, always challenge the insurance companies numbers and, if the company cannot prove its numbers, don't take no for an answer. A little bit of knowledge goes a long way.

Monday, July 13, 2009

Summertime and Storm Damgage

Summertime and storm damage go hand-in-hand. Thunderstorms, flooding, hurricanes and wind can all wreak havoc on your property. You need to be prepared.

This is a great time to read your insurance policy, photograph and record items in your home and make sure you get any insurance questions you have answered before a loss occurs.

Make sure you have adequate insurance. You need to have enough insurance to actually replace your home and property. This typically means that you will need more insurance than the market value of your property in the event your home is destroyed.

If you have a claim, report it to your insurance company immediately. If your claim involves water, get emergency help fast. Water claims turn into mold claims within 24 to 48 hours.

Don't let your insurance company delay your claim. Insist on prompt responses. Document every contact with your insurance company and its adjusters. Remember, you need to be your own best advocate.

Have a safe summer! If you need help with any aspect of an insurance claim go to A little bit of knowledge goes a long way.

Thursday, June 18, 2009

June 18, 2009

Yesterday we talked a little bit about how the insurance companies use the news, including bad news, to justify rate increases. Today, I'd like to talk a little bit about the commercials we see on television from the insurance industry.

We have all seen the TV commercials where your local adjuster not only sells you insurance but, immediately takes care of your claim when bad things happen. In reality, the insurance adjusters have little to no ability to resolve any accident or claim issues. Almost all insurance agents, including agents for State Farm, Allstate and many other big companies are not even company employees. They are independent contractors who sell insurance. Nothing more.

Some of the television commercials act as though the company is doing you a favor by hiring an attorney if you cause an accident and get sued. This is part of your insurance contract. They have to provide you with legal representation. This is one of the types of propaganda insurance companies years to convince you they're taking special care of you when they're really just complying with the contract of insurance you have bought and paid for.

We could talk for hours about this; however, it is much easier to simply take everything you hear from any insurance company with a very large grain of salt.

Wednesday, June 17, 2009

Insurance Propaganda

Wednesday June 17, 2009

A recent round of newspaper articles and other media reporting claims that individuals are burning their automobiles and turning in false insurance claims in order to collect money because of the miserable state of the economy. Only three instances were cited where this may have actually been done. The articles went on to say that this will cost the insurance companies billions of dollars which the public will have to pay for through increased premiums.

This reminds me of the mold scare in the late 1990s which resulted in homeowners across the country having huge increases in their policy premiums because the insurance companies were theoretically going to be paying billions of dollars on mold claims. It never happened.

Once the insurance companies convinced the state regulators to allow increases of up to 60% for homeowners premiums, the companies then put exclusions into all of their policies eliminating any exposure to mold claims. Within two years the maximum amount most people could claim for mold was $5000 or less. Consequently, mold was one of the best things to ever happen to the insurance industry. Incidentally, the insurance companies never gave back the 60% increases.

Now the insurance companies are using the economy to justify rate increases because of alleged fraud. This goes to show that the insurance companies will use anything at any time, no matter how bad the economy is, or how much the rest of the country is suffering to increase their profits.

If you receive a premium increase for your automobile policy, go directly to your insurance agent and demand to know why. Remember, the insurance companies are not your good neighbor, they are not on your side and it is up to you to protect yourself.

Finally, don't believe what you read and do not believe what you see if an insurance company is sending the message.