Home Building Insurance By Fam Fayek
When you purchase a home, which requires Homeowners insurance, you will find that there is a difference between the amount you paid for the home and the actual amount of home coverage without the contents.
This is simply because you paid market value for your home while the insurance company used replacement cost value to estimate what the costs would be to rebuild you’re your home.
The difference between market value and building cost:
Market value is simply the price you paid for your home and most often insurance agencies do not give market value a second consideration because the real estate investment market can fluctuate so greatly.
If you look at a property in 2003 in your area, it may have sold for $100,000 but just three years later in 2006 it sold for $130,000. This has to do with the demand for homes in the area and the rising costs of real estate, but this doesn’t have anything to do with what the actual cost of rebuilding the home would be.
Home owners insurance companies will always look at the cost of rebuilding the exact same home in the exact same location for a certain year with the same materials. This is the definition of replacement cost. So, if you are purchasing homeowners insurance in an area where the market is very high and homeowners are paying triple or double the building value of the home, then your actual replacement cost and insurance coverage may be lower than the market value of the home.
If you live in an area where the market is not so great during that particular year, then what you paid for your home might be less than what the actual replacement cost of the home is for that year. This is essential to keep in mind when calling the insurance company, as many customers are confused or even upset at the differences in price that insurance companies want to charge for coverage.
Keep in mind when receiving quotations from the insurance company that many may give you replacement value insurance coverage costs as well as market value insurance coverage costs, but it is always best to take the replacement value insurance coverage since this is what will be needed to replace your home in the long run. You also want to remember that land or ground value should not be included in the replacement cost assessment, so don’t let an insurance agent suggest otherwise because that will increase the premium for nothing..
Before speaking with an insurance agent, be sure to properly document the square footage of your home and each room, any special amenities that the home has including wood floors, marble or granite countertops, porches, decks or sunrooms, and basements
The insurance company will also want to know major appliances that come with the purchase of the home, as well as the basics of the plumbing system, electrical systems and air conditioning/heating units that are installed. This can help them to assess how much it will cost to replace these items during the current year of your Homeowners insurance policy, so you won’t be left out in the dark!
Thursday, 23 April 2009
Gap Insurance
Car Insurance By Fam Fayek
With the gap insurance, you can ignore the difference between the amount covered by the regular car insurance and the amount you owed to the car loan company. This difference is called a “gap” and the gap insurance bridges it so that you avoid the dilemma of looking for another loan.
When you get a gap insurance, determine how much is offered in the gap policy. You should also know how much will be added to your monthly bill. A gap insurance, for it to be recognized, must be accompanied with comprehensive insurance policies that cover the accident..
A gap insurance may not be needed if the terms in your regular car insurance policy indicated that the company will pay off the full amount you owed from the car loan lender
Gap insurance is also important in case of car leasing contract.
When insuring your car you must consider gap insurance. For gap insurance is considered as a financial safety belt? For it keeps you from being financially ruined when disaster hits your car.
For example you are an situation where you bought a late-model car three months ago using a car loan with a regular car insurance. The car costs $30,000 and you have already made three payments of $900 each month. Then, disaster strikes which caused the car to be beyond repair..
Immediately, you reported it to the car insurance company, which they in turn play with numbers, mileage, depreciation, market values, and other related stuff. After a couple of days, the adjustor informs you that the worth of your car at the time of the accident is $25,000. This is the amount that the car insurance company will provide you. But the finance company that gave you the loan will still consider the car to be worth its original price. They also play with numbers, interest rates, taxes and license fees. Then they come up with the amount of $38,000. This is the amount that you need to pay them. If the car insurance company releases the $25,000, where will you get the remaining $7,000? Your car is already a wreck but you still owe the finance company a lot of money..
Immediately, you reported it to the car insurance company, which they in turn play with numbers, mileage, depreciation, market values, and other related stuff. After a couple of days, the adjustor informs you that the worth of your car at the time of the accident is $25,000. This is the amount that the car insurance company will provide you. But the finance company that gave you the loan will still consider the car to be worth its original price. They also play with numbers, interest rates, taxes and license fees. Then they come up with the amount of $38,000. This is the amount that you need to pay them. If the car insurance company releases the $25,000, where will you get the remaining $7,000? Your car is already a wreck but you still owe the finance company a lot of money..
With the gap insurance, you can ignore the difference between the amount covered by the regular car insurance and the amount you owed to the car loan company. This difference is called a “gap” and the gap insurance bridges it so that you avoid the dilemma of looking for another loan.
When you get a gap insurance, determine how much is offered in the gap policy. You should also know how much will be added to your monthly bill. A gap insurance, for it to be recognized, must be accompanied with comprehensive insurance policies that cover the accident..
A gap insurance may not be needed if the terms in your regular car insurance policy indicated that the company will pay off the full amount you owed from the car loan lender
Gap insurance is also important in case of car leasing contract.
Financial planning and insurance
Financial planning By Fam Fayek
You must have insurance with secured loans, mortgages, credit cards and estate planning. Insurance answers you question: “What if something bad happens?”
Although no one likes to think of this subject yet it is very beneficial. In case of death insurance covers the loan and your beloved ones will be left encumbered with heavy unexpected debt.
What kind of insurance you need to cover your loan?
Determine the length of time that a particular expense will be present in your life time and get insurance that matches the term of the expense. If you have insurance on the mortgage of your house or on the loan of your car these will be paid off automatically at your death. And because you are matching the term of the loan to the term of the insurance, you are only buying insurance for as long as you have the loan or the mortgage.
You must have insurance with secured loans, mortgages, credit cards and estate planning. Insurance answers you question: “What if something bad happens?”
Although no one likes to think of this subject yet it is very beneficial. In case of death insurance covers the loan and your beloved ones will be left encumbered with heavy unexpected debt.
What kind of insurance you need to cover your loan?
Determine the length of time that a particular expense will be present in your life time and get insurance that matches the term of the expense. If you have insurance on the mortgage of your house or on the loan of your car these will be paid off automatically at your death. And because you are matching the term of the loan to the term of the insurance, you are only buying insurance for as long as you have the loan or the mortgage.
Business Insurance
The Business Insurance Financial planning
Undoubtedly the success of a business depends wholly on the hard work of team involved. Nevertheless, one disaster can bring all their efforts to naught and their profit to the drain. To avoid such a disaster from happening you must insure your business whether it is a big corporation or a small enterprise.
There are companies who provide insurance for the major property and liability risks as one package. This is called Business Owners’ Policy (BOP). It includes property insurance for buildings and equipments. It can cover any loss of income due to disruption of operation and accidental damage to business caused by fire for example.
Insurance of liabilities is to cover the company’s legal responsibility for the harm caused to others. It can also include physical injury or property damage caused by defective products or faulty installations or errors in the service provided. But BOP does not cover professional liability, auto insurance, worker’s compensation or health and disability insurance. These need separate insurance cover. Generally floods, earthquakes and terrorist attacks are not covered in the Business Insurance.
Flood Damage Protection
Make your own investigation about the zone area of your company whether it is prone to be hit by flood or it has been hit in the past in which case you must chose a policy that covers against flood. Make sure you do something beforehand otherwise you may face a big trouble.
Earthquake Damage Protection
As this protection not included in most Building (Property) Insurance Policies whether for homeowners or business owners package policies, you must make sure it is included in your policy especially If you live in an earthquake prone area.
You have to remember that Business Interruption Insurance, which reimburses for the loss of income during a shutdown does not apply if the loss is caused due the closure of business because of an earthquake. You must have an earthquake coverage policy to cover such loss.
Terrorists Attack Losses Protection
In the United States, loss cause by terrorism is covered only for the businesses that opted for terrorism coverage. It comes under the Terrorism Risk Insurance Act 2002.There are still exceptions in worker’s compensation that include injuries and deaths caused by acts of terrorism.
Business Insurance Online
By Fam Fayek
When looking for business insurance consider carefully the following important factors:
2- Stability: You have to bear in mind that there are many scams about and u have to be extra careful in making the right decision otherwise u will end up suffering bankruptcy. There are companies such as Standard & Poor’s Insurance rating Services, AM Best, Weiss Research, etc, whom u can consult for sufficient information about the company u have chosen
3- Service: It is well known that everyone tries to get the best value for money and good service is the best value for money with regard to insurance. You can find out about the level of service of the company you have chosen by the way they answer your queries and how far they explain the nitty-gritty of the insurance policy and its alternatives. Another way of finding out about the service of the company is to enquire from their references. Therefore, make enquiries and decide only after u are fully satisfied because once u sign you cannot do much if you find them giving you an unsatisfactory service. So be sure before you sign.
4- Information: Make sure there are no major black spots on the company. Check out whether the has complaints against it from the National Insurance Producer Registry
5- Insurance Agent: If you get insurance through a good agent he can guide you to the best policy and scheme for you. Nevertheless, because he works on commission basis with the major insurance companies he will no doubt be interested in earning the highest amount of money. Therefore he is prone to promote the company that pays him more. So be careful of taking his advice but rather check on the company yourself. If you decide to buy your insurance through an agent ask the agent for at least 5-10 references to check on his integrity. But should he refuses to give you references do not deal with him and find yourself another agent.
When looking for business insurance consider carefully the following important factors:
1- Price: You have to make sure that u r getting the best quote. This can be achieved by getting at least five quotes from five different companies and comparing between them, taking into consideration the pros and cons of each offer. You can also search through the internet to obtain an idea about the current rate. And another way is to ask friends and relatives for recommended companies.
2- Stability: You have to bear in mind that there are many scams about and u have to be extra careful in making the right decision otherwise u will end up suffering bankruptcy. There are companies such as Standard & Poor’s Insurance rating Services, AM Best, Weiss Research, etc, whom u can consult for sufficient information about the company u have chosen
3- Service: It is well known that everyone tries to get the best value for money and good service is the best value for money with regard to insurance. You can find out about the level of service of the company you have chosen by the way they answer your queries and how far they explain the nitty-gritty of the insurance policy and its alternatives. Another way of finding out about the service of the company is to enquire from their references. Therefore, make enquiries and decide only after u are fully satisfied because once u sign you cannot do much if you find them giving you an unsatisfactory service. So be sure before you sign.
4- Information: Make sure there are no major black spots on the company. Check out whether the has complaints against it from the National Insurance Producer Registry
5- Insurance Agent: If you get insurance through a good agent he can guide you to the best policy and scheme for you. Nevertheless, because he works on commission basis with the major insurance companies he will no doubt be interested in earning the highest amount of money. Therefore he is prone to promote the company that pays him more. So be careful of taking his advice but rather check on the company yourself. If you decide to buy your insurance through an agent ask the agent for at least 5-10 references to check on his integrity. But should he refuses to give you references do not deal with him and find yourself another agent.
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