Summertime and the livin’ is easy-
IF YOU HAVE INSURANCE

By Alan Plafker, PRESIDENT & CEO
Member Brokerage Service, LLC
A Melrose Credit Union Service Organization

Summer is a time for getting away or enjoying the comforts of your backyard. And, just as sunscreen should protect you from a terrible sunburn, your insurance policies should protect you from summer’s unique risks. But are you covered? We can help answer that question.

Vacations.

Thinking of taking a vacation this summer? Travel insurance will provide you with peace of mind offering coverage to protect against trip cancellations and delays due to:

• unexpected illness, injury or death of a family member;
  
  
  
• financial default by a tour operator;
  
  
  
• bad weather or natural disasters that close travel services; and
  
  
  
• other circumstances that could not have been reasonably foreseen.

Lost luggage may also be covered under a basic policy, but expensive items such as jewelry or sport equipment may not.

Summer transportation.

If you are renting a car your own automobile insurance policy should cover you in the event of an accident or other damages. (See related section below.) However, if you’ve decided this is the year to purchase that boat you’ve always dreamed about, remember they need their own insurance policies. Most boats are not covered under homeowners or automobile insurance policies.

Backyard fun.

Thinking of staying close to home this summer? There still are insurance issues you need to consider. Pools, trampolines, hot tubs and grills may be the definition of summer fun, but they can be huge liabilities if preventative care is not taken and insurance turns out to be inadequate.

Make sure your homeowners policies offer you the proper protections in the event of an accident. And remember, most insurance companies aren’t too fond of trampolines; so if you haven’t purchased it yet, think about whether you really want to assume the risk.

We don’t want to take the fun out of your summer. We want you to have the protections you need so you can concentrate on your tan rather than your liability coverages. Give your agent or Broker a call today, and start enjoying the warm weather tomorrow.

Renting a car on vacation?

You may not need the extra insurance offered by the rental car company. If the rental contract does not exceed 30 days and the rental car will not be driven out of the United States, its territories and possessions, and Canada, then the extra “collision damage waiver” insurance and the “liability” insurance are unnecessary. However, if your travel plans include Europe, then we’ll need to talk.

When you have a New York personal auto policy you automatically receive rental car protection with that policy. This is not typical of policies issued in other states which is why the rental car company in Florida may attempt to convince you that you need the extra protection. However, in most cases, you don’t need it. So spend the cost savings on extra fun instead of extra insurance!

When in doubt, call your insurance agent before you reserve a rental car. Just give them the details of the trip you have planned and they’ll help you determine whether you need the extra insurance before you pick up the car.

Did you know? Retirement

You’ve saved and saved, and finally it’s here—retirement. But, before you say “Sayonara” to your job and book that cruise to the Caribbean, stop and think ... Have you really planned for everything?

What about medical expenses? Do not rely solely on Medicare to cover your medical expenses. Medicare wasn’t designed to pay your full health care costs. In fact, according to the American Association of Retired Persons, “on average Medicare pays for just 56 percent of your health care expenses.” That leaves 44 percent coming from your savings. What about deductibles? Twenty dollars a visit can add up quickly. With hospital visits your savings can drain even more quickly.

Even these costs make the assumption that you will never come down with a chronic illness or suffer a disability that requires long term care, medical and nonmedical support services that can be provided at home in an assisted living facility or a nursing home. But, according to the U.S. Department of Health and Human Services, “this year, about nine million men and women over the age of 65 will need long term care. By 2020, 12 million older Americans will need long term care.” The need for long term care clearly is not rare, but it is expensive. Depending on where you live, a year long stay in a nursing home can cost anywhere from $30,000 to over $100,000 dollars.

But the news is not all dire. The proper insurance coverage can help prepare you for the true costs of retirement.

Medicare supplemental coverage

Medicare is a valuable service. But, there are some gaps:

• a per incident hospital stay deductible ($992 for 2007),
  
  
  
• hospital coinsurance payments after the first 60 days ($248 per day in 2007),
  
  
  
• an annual prescription deductible ($131 in 2007),
  
  
  
• a 20 percent prescription coinsurance payment and more.

Long term care insurance

We may not want to think about it, but the odds of any one of us needing long term care aren’t nearly long enough to comfortably gamble our golden years, especially, when even a short stay in a nursing home or assisted care facility can drain a savings account. Long term care coverage can help pay for assistance with activities of daily living, eating, bathing, dressing, etc. in a nursing home, assisted living facility or at home without cleaning you out.

If you’d like more information or advice specific to your particular situation please call your insurance advisor, and make sure your retirement is your dream and not a financial nightmare.

If you build it, the building inspector will come

The building inspector will show up whether you are building a new home, adding to your existing home or rebuilding after loss by fire. Local governments enforce building codes that establish minimum standards for construction that ensure our safety and protect our investment.

This becomes an insurance issue when compliance with the new standards adds cost to the rebuilding of your home and the homeowner policy you purchased covers only replacement of the home that previously existed. The typical policy promises to pay for costs to rebuild the dwelling as it existed when the loss occurred and generally allows only an extra 10 percent of the dwelling coverage limit to pay the extra costs generated by an updated building code. Under most building codes, if damage to a dwelling exceeds 50 percent, the undamaged portion must be demolished and rebuilt.

Suppose your existing home can be replaced for $250,000 and it will require an additional $37,500 to construct it to current building code. If half the home were damaged, the typical homeowners policy would pay $125,000, allowing only an additional $25,000 for the cost to demolish and reconstruct the other half of the house and to pay the $37,500 cost of bringing the whole house to code. You would, then, be short about $137,500.

These extra uncovered expenses can be insured with an “ordinance or law” endorsement for additional premium. Even if your policy insures your dwelling on the basis of replacement cost you still need this specific coverage. Please call your insurance agent's office if you would like a quote for the additional premium for this protection so that all the costs to rebuild are covered.

Safeguard your property against arson

Did you know the cost of insurance losses from fires far exceeds the expenses associated with any other catastrophe? And, did you also know that arson is the second most frequent cause of all fire damage in the United States? It resulted in more than $909 million worth of property damage in 2006.

Property owners face an average potential loss of about $13,325 per incident creating significant financial burden on homeowners not only through direct property damage. Increased frequency of arson ultimately results in costlier insurance premiums for everyone due to the greater cost of fire protection.

Though your home’s insurance policy most likely provides coverage for arson, it is imperative that homeowners take notice of this growing problem and the threat it poses to property, profits, jobs and lives. You can lessen your risk with a few simple, preventive steps:

• Invest in fire safety. Purchase and continually maintain fire alarms and extinguishers. Consider having a sprinkler system installed. Be sure your family is prepared with a fire escape plan
  
  
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• Keep things clean. Dry, combustible materials on your property cause fires. Remove weeds and brush near your home. Do not allow trash to collect on your property.
  
  
  
• Consider enhanced security measures. By keeping unauthorized people off of your property you greatly reduce your risk of becoming a victim of arson as well as other crimes. Enclose your yard with a fence. Install automatic, outdoor lighting to deter potential criminals. Be sure to replace any missing or broken window panes.
  
  
  
• Know the statistics. Over half of all arsons are committed by juveniles for the purpose of vandalism. If you suspect someone is setting fires or see any suspicious activity be sure to report it to your local police or neighborhood watch program, and request a regular patrol in your neighborhood. The best protection against arson and general fire safety is an awareness of the activity around your home,

Your Professional Insurance Agent . . .
We want you to know about the insurance you’re buying.

Alan Plafker is President of Member Brokerage Service LLC, a Melrose Credit Union Service Organization. He is a licensed Insurance Broker and serves on the Board of Directors the PIANY (Professional Insurance Agents Association of NY) and on the Board of CIBGNY (Council of Insurance Brokers of Greater NY). His Agency insures thousands of polices for TLC Insurance as well as many policies for all types of insurance. You can reach him in his Briarwood, Queens office at (718) 523-1300 ext. 1082.

Information for this article was developed by Edward Huttick, CFP (at ext # 1136) who heads the Life, Health & Financial Planning Department at Member Brokerage Service LLC.

© 2015 TLC Magazine Online, Inc.