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Things to Know about Coverage for Jewelry and Other Valuables

Your Homeowners Insurance May Cover Only Part of What You’d Pay to Replace High-Value Items

Standard homeowners and renters insurance policies include some coverage for jewelry and other precious items such as watches and furs. Like other belongings, high value items are covered for losses caused by all the perils included in your policy such as fire, windstorm, theft and vandalism.

However, there are special limits of liability for certain items, meaning that the insurer will not pay more than the amount specified in the policy. One important limit is for the theft of jewelry. To keep coverage affordable, because jewelry can be easily stolen, standard policies have a relatively low limit for theft coverage, generally $1,500.

If you own valuable jewelry or other items that would be difficult to replace, there are two ways you can increase coverage: by raising the limit of liability, or by “scheduling” your individual pieces through the purchase of “floater” policies. Raising the limit of liability is the least expensive option in terms of insurance premium cost; however, there is generally a limit on the amount you can claim for the loss of any individual piece, say $2,000, when the overall limit is $5,000.

Scheduling each piece or item may cost more in premiums, but it offers broader protection because the floater covers losses of any type, including accidental losses—such as dropping your ring down the drain of the kitchen sink or leaving an expensive watch in a hotel room—that standard policies do not cover. Before purchasing a floater, the items covered must be professionally appraised. Your insurance company may be able to recommend a local appraisal firm.

Source: Insurance Information Institute

Credit and Insurance Scores

Insurance scores and credit scores differ. Credit scores predict credit delinquency while insurance scores predict insurance losses. Both are calculated from information in a credit report, such as outstanding debt, bankruptcies, length of credit history, collections, new applications for credit, number of credit accounts in use, and timeliness of debt repayment. Insurers or scoring agencies then calculate the insurance or credit score by assigning differing weights to the favorable or unfavorable information in the credit report. Information such as income, ethnic group, age, gender, disability, religion, address, marital status and nationality are not considered when calculating an insurance score.

Credit and insurance scores measure how well individuals manage their money—not how much money they make. And actuarial studies show that how a person manages his or her financial affairs is a good predictor of insurance claims. Statistically, people with a low insurance score are more likely to file a claim.

The good news is, most people have good credit and most people will pay less for insurance than they would if insurance scores weren’t considered.

Source: Insurance Information Institute

Finding Coverage that Matches Your Business Size

Home Business, Small Business, Global Business—Here’s How to Choose the Right Coverage for Your Business

The types and amount of insurance that you need for your small business are based on several factors. What type of business are you in? Where is it located? Do you have employees?

You can evaluate your insurance needs—and start your search for insurance—by first considering the size of your business. These definitions may vary, but are generally based on the number of employees, total sales and earnings. The definitions below can help you determine where your business falls—and your insurance professional can provide guidance as well.

Home-Based Businesses

Many successful business launches start at home. Typically home-based businesses consist of one or no additional employees and have relatively little revenue.

However, that doesn’t mean that the business shouldn’t be insured. Every business—including home-based businesses—should be insured against risk. According to the U.S. Small Business Administration (SBA), more than half of American businesses are based at an owner’s home—and too many fail to carry appropriate business insurance. While a home-based business is almost always by most definitions a small business, its location may require special attention to insurance coverage. Homeowners insurance alone will not necessarily cover your home-based business against business property loss or liability.

Small Businesses

Do you know all of your employees by name? Does your business make less than a few million dollars annually? If so, you’re most likely operating a small business. Some insurers consider businesses with 50 or fewer employees to be small businesses. The SBA defines a small business concern as one that is independently owned and operated, is organized for profit, and is not dominant in its field.

A common small business policy—called a BOP, for “Business Owners Policy”—is usually available only for businesses with fewer than 100 employees and revenues of up to about $5 million or less. While you can purchase customized insurance to cover your specific type of business, insurers offer standardized small business policies that enable you to affordably protect your company against the most common risks.

Medium-Sized Businesses

If your small business is growing and thriving, you may have graduated into a medium-sized company. Again, definitions of business sizes vary, but if your company has between 50 and 1,000 employees with annual revenues between $10 million and $1 billion, you can seek insurance as a medium-sized business. Insurers have special policies designed specifically for this segment that may combine property and liability coverage. If your medium-sized business owns especially expensive equipment or has locations in more than one state, you may also want to seek special customized policies.

Large Businesses

Large businesses have at least 500 employees; revenue requirements are dependent on the type of business.

Large, complex businesses have multi-million dollar risks, and commercial insurance is customized to meet a company’s specific needs. Large companies even have employees dedicated to analyzing the potential causes of accidents or loss, recommending and implementing preventive measures, and devising plans to minimize costs and damage should a loss occur, including the purchase of insurance and managing claims. This practice is known as risk management. If you run a small business, you generally have to act as your own risk manager. Sometimes a small business will hire a risk management consultant. If you’re unsure, ask an insurance professional to help assess the risk for businesses of all sizes.

Source: Insurance Information Institute

Steps to Reduce Workplace Injuries


Injuries to employees can be devastating for businesses, especially small businesses with fewer employees available to take on new roles when an injured worker is on leave. While workers compensation insurance will help pay medical costs and replace an injured employee’s lost income, your business will have to absorb costs associated with reduced productivity, overtime, training replacements, and so on.

The best way to minimize the hidden costs of workplace injuries and related insurance costs is to prevent accidents from happening in the first place. Follow the steps below and consider developing a formal, comprehensive workplace safety program to help reduce the risk of injury:

  • Engage Management and Employees—Businesses are most successful improving workplace safety when leadership and employees collaborate. Responsibility for workplace safety should be part of everyone’s job, and specific employees and managers should be tasked with implementing, maintaining and improving workplace safety program components.
  • Analyze Your Workplace and Operations—Evaluate your business from top to bottom. Review your equipment as well as all workplace activities. As part of your evaluation, talk to your employees to learn their safety concerns. Whenever you add new operations, equipment or facilities to your business, analyze these for risks as well.
  • Mitigate Hazards—Simply identifying and being aware of hazardous practices, equipment and infrastructure is not enough. When hazards are identified, you should seek to remove or control them by replacing or fixing equipment, adding new safety measures or changing workplace operations.
  • Implement Training—Train employees about workplace safety and how to identify hazards. Include workplace safety training as part of employee onboarding and offer refresher training on a regular basis. In addition to injury prevention training, you may want to include first-aid training so that your workforce can respond effectively if an accident does occur.
  • Review, Respond and Improve—Promoting workplace safety is an ongoing process. You should review and improve your program—especially in response to accidents or “near misses.” Employees should always be encouraged to report newly identified hazards or workplace incidents so that you can respond appropriately.

Workplace safety programs provide additional benefits beyond preventing accidents. These programs have been found to increase employee morale, retention and productivity.

 Beyond Prevention: Workers Compensation Insurance

Unfortunately, accidents and injuries do happen. Following the steps above can help reduce workplace injuries, but the risk cannot be absolutely eliminated. To help employees—and your business—recover from a workplace injury, your company will need workers compensation insurance. Workers compensation insurance requirements for employers vary from state to state—and knowing the requirements for your state is essential to protecting your business.

What Workers Compensation Covers

A workers compensation insurance claim can be filed if an employee is injured at your workplace or while on the job at another location. A claim can also be filed if a worker is injured in a vehicle accident while on business. Costs are also covered for employees that develop work-related illnesses. Your workers compensation insurance will cover:

  • Income Benefits–Replaces a portion of an employee’s salary when work is missed.
  • Medical and Rehabilitation Costs—Pays necessary medical care to treat work-related injuries or illness.
  • Funeral Expenses—In the case of death, funeral and related expenses such as burial or cremation are covered.
  • Death Benefits—Paid to a surviving spouse and dependents.

Each state has different laws governing the amount and duration of lost income benefits, the provision of medical and rehabilitation services and how the system is administered. For example, in most states there are regulations that cover whether the worker or employer can choose the doctor who treats the injuries and how disputes about benefits are resolved.

What Isn’t Covered

While workers compensation covers costs directly tied to an injured employee, it does not cover the hidden costs associated with the loss of an employee, including:

  • Business interruption losses.
  • Hiring and training of employees.
  • Overtime costs.

Workers compensation must be purchased as a stand-alone policy, approved by the state in which you do business. This type of coverage is not included in Commercial Package Policies (CPPs) or Business Owners Policies (BOPs).

Source: Insurance Information Institute

What Do Women Business Owners Want? Credible, Accurate Insurance Advice

NEW YORK, February 29, 2016 —Women have made great strides in the business world in the past few decades. And business insurance is essential to protecting their hard-earned capital, according to the Insurance Information Institute (I.I.I.).

Forty years ago women owned just 5 percent of all small businesses in the United States. Today, they own one-third, generating nearly $1.5 trillion in revenue and employing over 7.9 million people. Between 1997 and 2015, the number of women‐owned firms increased by 74 percent, according to the2015 State of Women-Owned Businesses Report. And the majority of new women-owned firms launched in 2014 were owned by minority women.

“Whether launching a new business, growing your business or competing in the global marketplace, it is essential that women business owners get the right type and amount of coverage,” said Loretta Worters, a vice president with the I.I.I. “Without adequate insurance, a natural catastrophe, employee lawsuit or even the death of a business partner could destroy what they’ve built,” she warned.

In recognition of Women’s History Month, the I.I.I. recommends the following six strategies to ensure that your business is financially protected:

1. Assess your risks. What business property, including inventory and equipment, do you own? Do you have employees? What is the nature of your business? This basic snapshot will help an insurance professional provide recommendations about the type of coverage your business needs.

2. Find the right insurance professional. When shopping for insurance most business owners use an insurance broker—you’ll want to find one who is familiar with the risks of your specific business. A qualified broker can help collect all the necessary information and paperwork to apply for a policy, and comparison shop among several options and quotes. Here are some tips for finding the right fit: Finding the Right Insurance Professional for Your Business.

3. Compare rates. As a general rule, you’ll want to get business insurance quotes from at least three different companies. Try to find policies that offer similar coverage so that you can clearly compare prices.

4. Evaluate insurers, policies and services. When purchasing business insurance, price is just one consideration. Make sure a potential insurer is reputable and in good financial condition. In addition, review and compare policies in depth. Does one policy have exclusions that another does not? In the case of litigation, does the insurer provide an attorney or reimburse you for an attorney you choose?

5. Lower your premiums. Choosing a higher deductible can lower your premiums significantly and insurers will often lower your rates for putting in place programs to minimize losses from fire, theft and employee and customer injuries. This is particularly important for start-ups that are low on initial capital.

6. Review your risks and insurance policies annually. Talk to your insurance professional prior to renewing you coverage each year to determine what adjustments should be made to your business insurance policies. If your business is expanding, you have purchased or replaced equipment or have started working with vendors internationally, you may have new liabilities that require higher insurance coverage.

Don’t Overlook These Coverages

Life insurance is vital to any business—both personal and for the company. Should you die prematurely, a personal life insurance policy can replace your income from the business and protect your family. In the event an owner, partner or key employee dies, life insurance will take care of your business.

Another key coverage is disability insurance. More than twice as many people will be disabled during their career as will die before they retire. “Income protection for small business owners is critical for the long-term security of the owner and the company if they cannot work due to an injury or illness,” said Worters.

Find more information about protecting your business, in the business insurance section of the I.I.I.’s website.

Source: Insurance Information Institute

How to Choose the Right Type of Life Insurance

life insurance 2
Choosing the right type of life insurance can be confusing, but it’s also an important decision. Here are some guidelines that can help you narrow down your best life insurance options.

You should consider term life insurance if:

  • You need life insurance for a specific period of time. Term life insurance enables you to match the length of the term policy to the length of the need. For example, if you have young children and want to ensure that there will be funds to pay for their college education, you might buy 20-year term life insurance. Or if you want the insurance to repay a debt that will be paid off in a specified time period, buy a term policy for that period.
  • You need a large amount of life insurance, but have a limited budget. In general, this type of insurance pays only if you die during the term of the policy, so the rate per thousand of death benefit is lower than for permanent forms of life insurance. If you are still alive at the end of the term, coverage stops unless the policy is renewed or a new one bought. Unlike permanent insurance, you will not typically build equity in the form of cash savings.

If you think your financial needs may change, you may also want to look into “convertible” term policies. These allow you to convert to permanent insurance without a medical examination in exchange for higher premiums.

Keep in mind that premiums are lowest when you are young and increase upon renewal as you age. Some term insurance policies can be renewed when the policy ends, but the premium will generally increase. Some policies require a medical examination at renewal to qualify for the lowest rates.

You should consider permanent life insurance if:

  • You need life insurance for as long as you live. A permanent policy pays a death benefit whether you die tomorrow or live to be over 100.
  • You want to accumulate a savings element that will grow on a tax-deferred basis and could be a source of borrowed funds for a variety of purposes. The savings element can be used to pay premiums to keep the life insurance in force if you can’t pay them otherwise, or it can be used for any other purpose you choose. You can borrow these funds even if your credit is shaky. The death benefit is collateral for the loan, and if you die before it’s repaid, the insurance company collects what is due the company before determining what’s goes to your beneficiary.

Keep in mind that premiums for permanent policies are generally higher than for term insurance. However, the premium in a permanent policy remains the same no matter how old you are, while term can go up substantially every time you renew it.

There are a number of different types of permanent insurance policies, such as whole (ordinary) life, universal life, variable life, and variable/universal life. For more details, see our articles on the specific types of policies.

Source: Insurance Information Institute

Tips for Surviving Severe Cold Weather


Much of the country periodically experiences severe and sustained cold weather, with snowfalls interspersed with periods of melting and freezing. This can inflict considerable damage on homes.

Here are some tips and steps you can take to keep your home safe and make insurance losses less likely during extended severe weather.

  • Keep sidewalks and entrances to your home free from snow and ice.
  • Watch for ice dams near gutter downspouts. Keep gutters free of leaves and debris so melting snow and ice can flow freely. Ice dams can cause water to build up and seep into your house.
  • Keep the house heated to a minimum of 65 degrees. The temperature inside the walls where the pipes are located is substantially colder than the walls themselves. A temperature lower than 65 degrees will not keep the inside walls from freezing.
  • Identify the location for the main water shutoff in your home. Find out how it works in case you have to use it.
  • Open hot and cold faucets enough to let them drip slowly. Keeping water moving within the pipes will prevent freezing.
  • If you own a swimming pool and temperatures are expected to dip below freezing, run the pool pump at night to keep the water flowing through the pipes.
  • If you haven’t already, make sure all hoses are disconnected from outside spigots.
  • If your garage is attached to your house, keep the garage doors closed. The door leading to the house is probably not as well-insulated as an exterior door.
  • If ice forms on tree limbs, watch for dead, damaged or dangerous branches that could break and fall because of ice, snow or wind and damage your house, a car, or injure someone walking near your property.
  • If you use fireplaces, wood stoves and electric heaters, watch them closely and make sure they are working properly.
  • Remember to close the flue in your fireplace when you’re not using it.
  • If you have to leave your home on a trip, ask a neighbor to check the house regularly. If there is a problem with frozen pipes or water leakage, attending to it quickly could mean far less damage.
  • If you plan to be away for an extended period of time (or if temperatures are expected to remain below freezing), have the water system, including pool plumbing, have the water system drained by a professional to keep pipes from freezing or bursting.

A Worst-Case Scenario

  • If you discover that pipes are frozen, don’t wait for them to burst. Take measures to thaw them immediately, or call a plumber for assistance.
  • If your pipes burst, first turn off the water and then mop up spills. You don’t want the water to do more damage than it already has.
  • Call your agent or company as soon as you can. An insurance adjuster doesn’t need to see the spill before you take action. However, he or she will want to inspect any damaged items.
  • Make temporary repairs and take other steps to protect your property from further damage. Remove any carpet or furniture that can be further damaged from seepage.
  • Make a list of the damaged articles.
  • Save the receipts for what you spend—including additional living expenses if you must leave your home until repairs are completed—and submit them to your insurance company for reimbursement.

Standard homeowners policies will cover most of the kinds of damage that result from a freeze. For example, if house pipes freeze and burst or if ice forms in gutters and causes water to back up under roof shingles and seep into the house. You would also be covered if the weight of snow or ice damages your house.

However, most policies do not cover backups in sewers and drains or flood damage, which can also happen in winter. To be covered for flooding, you need a policy from the National Flood Insurance Program, while coverage for sewers and drains is generally offered as an endorsement to a standard homeowners insurance policy.

If your home suffers water damage, it is important to make sure that it is properly dried and repaired to prevent any potential problem with mold. Remember, mold can not survive without moisture.

Check with your agent or company so you’ll be sure what your policy covers.

Source: Insurance Information Institute