January 2018

Get Covered: Your 2018 Insurance Check-up

Author: Linda S. Hopkins

While insurance may not be your favorite cocktail party conversation starter, it’s a topic that is on most people’s minds. The recent storms we have weathered locally and the changing status of healthcare in America are just two reasons why ears are perking up, existing policies are under the microscope, and pencils are being sharpened in the insurance industry. “It’s not cookie-cutter,” said Kinghorn Insurance partner, Missy Layman. “That’s what makes what we do so wonderful and so relevant and important.”

Whether you are a millennial just getting your feet wet in the world of adult responsibilities, one of the last standing of The Greatest Generation, or somewhere in between, one of your goals for 2018 should be to become more educated and informed regarding your insurance options. Some types of personal insurance, such as automobile liability insurance and, under the Affordable Care Act, health insurance, are required by law. Others, such as comprehensive and collision automobile insurance and homeowners insurance, can be required by lenders when property is used as loan collateral.

Businesswise, South Carolina requires that anyone who employs four or more persons, whether full- or part-time, carry workers’ compensation insurance. Large businesses (over 50 full-time employees) are required by federal law to either offer qualified and affordable health benefits or pay a tax penalty, referred to as the employer mandate.

“The question is, what do you have to have; but the bigger question is how do you buy it and how do you assess it?” Layman said, cautioning against choosing minimum limits. “We could all get away with checking the box, but what we recommend to you will be based on your individual needs. That is the value of your insurance agent. People need to be smarter about their insurance options, and the agent or broker needs to explain the differences.”

It’s complicated
People in all walks of life need insurance, and products are available to suit every individual circumstance. Like the handy overhead oxygen mask on an airplane, you hope you never need to use it, but if you do, you’ll be happy it’s there.

Insurance policies come in a variety of shapes and sizes and boast many different features, benefits and prices. “The key to making good decisions is finding an agent who asks the right questions,” Layman said. “Every risk is unique, and a reputable insurance agent must know how to evaluate those risks and figure out which carriers and policies are the best fit.”

Ray Craver of Seacoast Insurance advises consumers to read their policies and talk to the agent to be sure they understand the contract. When insuring property, he recommends not only covering the cost of replacing the dwelling, but the contents and loss of use. “If there is a storm or a fire and you have to rent another place to live, that’s an expense that a lot of people don’t really pay attention to,” he said. “Understand what your deductibles are,” he added. “They can vary widely, especially when it comes to wind,” e.g. hurricane deductibles, named storm deductibles, wind and hail deductibles. He also urges all coastal area property owners to carry flood insurance, regardless of their flood zone rating.

Health insurance is another sticky wicket and bears careful consideration. The insurance industry can get a bad rap for overselling people, and seniors are particularly vulnerable to slick salesmen on the phone, especially regarding Medicare coverage. “As you get older, the options become more complicated; you’ve got your whole alphabet!” Layman said. “Some of the smartest people in the world are confused by Medicare.” She advises against comparing coverage with your neighbors and friends. “Just know that your situation is different. Maybe they have more assets or different needs. Every situation is different and coverages are different. It’s very personal.”

Regarding Open Enrollment and private health insurance, Layman added, “The government says you have to have it, but somebody’s gotta help you understand your options. Most people want someone to tell them, but they don’t want to understand. That’s kind of the trap. It’s great for someone to make a recommendation, but that’s only in their world. Ideas and options are out there from different carriers, and an educated marketplace is always the best.”

She also cautions against making hasty insurance decisions on the Internet. “You can be misinformed or confuse yourself. The Internet is a lovely place to be, but it’s not going to be there when you have a claim.”

Accountability is a huge advantage to working with an insurance agent you trust—someone who is looking you in the eye. Many claims go smoothly, but sometimes there is a gray area or you need someone to go to bat for you—to mediate between you and the insurance carrier. “If something goes down here, is the lizard going to show up? Or is Flo down at 1-800 going to help you? It’s a 360-degree circle from the way you buy your insurance to the end result when you have a claim,” Layman said.

“Based on the caliber of agents in this community, there is no reason to go elsewhere to get the products and services you need from an insurance agency, but you really need to get educated and do due diligence on your coverage, your carrier and your agent,” she continued. “There is a relationship with the insured and the agent or broker. It doesn’t mean you have to be friends, but they have to be good at what they do.”

“I think the general public here is pretty well-educated,” Craver said. “But people became a little bit more aware after the recent storms.” His best advice: “Ask questions. Don’t be afraid or embarrassed to ask about terminology you don’t understand.”

What to insure
You can insure just about anything for a price. Celebrities and athletes might insure body parts; owners of exotic pets might carry animal liability coverage; wealthy businessmen sometimes insure themselves and their families against kidnapping and ransom; and as bizarre as it might sound, some people insure themselves against alien abduction—just in case. Luxury items such as jewelry, art, antiques, designer goods, etc. that are not covered under your homeowner’s policy can also be insured.
If you are in business, commercial lines protect against potentially devastating financial losses caused by accidents, lawsuits, natural disasters and other adverse events. Coverage available and premium costs vary by business type, size, and location.

Personal lines insurance includes products such as homeowners insurance, flood insurance, earthquake insurance, renters insurance, automobile insurance, life insurance, disability insurance, umbrella insurance and health insurance. These products protect you and your family against potentially devastating financial losses caused by fire, theft, natural disasters, death, accidents, lawsuits and illness.

The Insurance Information Institute recommends reviewing all your insurance policies at least once a year. In the meantime, if you have a major life change, you should contact your insurance agent or company representative immediately, because that change may have a significant impact on your insurance needs. Life changes may include marriage or divorce; the birth or adoption of a child; significant changes in your health or that of your spouse/domestic partner; taking on the financial responsibility of an aging parent; a loved one who requires long-term care; purchasing a new home; refinancing your home; or coming into an inheritance. If you modify your property—say by adding a pool or a fire pit—or should you purchase a golf cart, a trampoline, or an aggressive breed of dog, you may need to modify your insurance to cover additional risks of loss and/or liability.

“Like a routine physical, you need to do a check-up on your insurance,” Layman advised. “It’s pretty tough when you go in after you don’t feel good.”

  1. Excellent piece. I’m out of your market, but your advice travels well. I think it will serve me well here in FL. Thanks.

    — Frank Babbitt    Jan 29, 10:25 pm   

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