Q: How much life insurance should an individual own?
A: Rough "rules of thumb" suggest an amount of life insurance equal to 6 to 8 times annual earnings. However, many factors should be taken into account in determining a more precise estimate of the amount of life insurance needed. Important factors include:
- Income sources (and amounts) other than salary/earnings
- Whether or not the individual is married and, if so, what is the spouse's earning capacity
- The number of individuals who are financially dependent on the insured
- The amount of death benefits payable from Social Security and from an employer sponsored life insurance plan
- Whether any special life insurance needs exist (e.g., mortgage repayment, education fund, estate planning need), etc.
|
|
|
Q: Suppose I lend my car to a friend, is he/she covered under my automobile insurance policy?
A: Whenever you knowingly loan your car to a friend or an associate, he or she will be covered under your automobile insurance policy. In fact, even if you do not give explicit permission each time a person borrows your car, they are still covered under your automobile insurance policy as long they had a reasonable belief that you would have given them permission to drive the car.
|
|
|
Q: Should you purchase rental agency coverage
A: If you have collision and comprehensive ("other than collision") coverages on your own car, you are most likely covered if you're traveling in the United States, its territories and possessions or Canada (for example, travel in Mexico, the Bahamas or Europe would not be covered). Most policies (except business policies) cover any rental car that you drive at no additional premium. Business cars frequently require an extra premium to afford the same coverage. Give us a call before you leave for your "fun in the sun and/or snow" to confirm your coverage.
|
|
|
Q: If a cellular phone is stolen from your car (or along with your car if it is stolen), is it covered by your auto insurance?
A: No, it is not unless the phone is permanently installed and powered by the car's electrical system.
|
|
|
Q: What is Lease Loan Gap Coverage?
A: If you are thinking about leasing or buying a car, you might consider adding Lease Loan Gap (LLG) Coverage to your auto policy. LLG Coverage is an extension of your auto's physical damage coverage.
Ordinarily, your comprehensive and collision coverages provide you with up to the actual cash value (the vehicle's cost minus depreciation) in the event of a total loss. When you sign a lease or loan agreement, you may be obligating yourself for an amount higher than the vehicle's actual cash value.
At a cost of approximately 5% of your current comprehensive and collision premiums, LLG Coverage protects you from out-of-pocket expense when such a "gap" occurs. Although there are some limitations, LLG Coverage will pay up to your lease or loan amount if your car is stolen or if the cost of repairs is greater than its salvage value. Contact our office and we'd be happy to discuss this coverage further.
Note: Some car manufacturers may provide gap coverage as part of the lease agreement --- check your particular contract for details.
|
|
Q: What is Business Interruption/Extra Expense coverage?
A: Business Interruption/Extra Expense coverage provides coverage for income loss and the expense of establishing a temporary site during repairs due to damages related to a fire or compensable loss. |
|
Q: What is a peril?
A: A peril is the cause of a possible loss (examples include fires or windstorms). |
|
Q: What is the difference between Replacement Cost (RC) and Actual Cash Value (ACV)?
A: Replacement Cost is the current cost to replace property. Actual Cash Value is the replacement cost less depreciation. |
|
Q: What does 80% co-insurance mean?
A: Insurance carriers require that an insured party pay 80% of the replacement cost in order to collect a partial loss in full. This is the way the insurance company encourages all insureds to adequately insure their property in relation to other insureds. |
|
Q: Can other people drive my business vehicle?
A: Other people may drive your vehicle with your permission. It is important that they be listed on your policy if they are regular drivers of the vehicle. |
|
Q: Why do I need certificates of insurance from sub-contractors?
A: An audit may require you to show proof that sub-contractors had their own insurance coverage. The sub-contractors' certificates of insurance will prevent you from being charged for their exposure. |
|
Q: What if I share my apartment with a roommate? Do we both need to have renters insurance?
A: Standard renters policies cover only you and relatives that live with you. If your roommate is not a relative, each of you will need your own renters policy to cover your own property and to provide you liability coverage for your own actions. |
|
Q: How do I know if I need a personal umbrella liability policy?
A: It used to be that the only people who needed personal umbrella liability policies were wealthy individuals who had sizable amounts of personal assets that would be at risk in a lawsuit.
However, in our very litigious society, many people are realizing that they have a need for more liability insurance than what is provided under their homeowners and automobile insurance policies. The personal umbrella policy is ideally suited to provide this protection.
|
|
|
