Rates do not always increase after a claim, but claims do factor into your risk score and can result in increases in premium. Rate increases after a claim are typically a result of the insured being seen as an increased risk to the insurance company and a high loss ratio on the account. The effect claims have on your premium will decrease over time and the more you pay in premium the more claims you can have without having a premium increase.
We work with our clients to proactively take steps to prevent claims from happening in the first place.
A loss ratio is calculated by taking the premium paid for the last 3 or 5 years and then dividing that by the amount of money paid out in claims. The higher the loss ratio the higher the insurance cost will be.
If you pay $2,000 per year for insurance and have a claim during your 2nd year of coverage for $3,000. Your 3yr loss ratio would be 75%. This is because over the past 3 years you have had coverage for 2 of them and paid $4,000 in and had claims of $3,000. After 3 years pass with no more claims your 3-year loss ratio will be 0% and your 5-year loss ratio will be 30%. (5 years of coverage at $2,000 per year with a $3,000 claim occurring in year 2 of the past 5 years of coverage.)
This is why the effect of claims on your premium will typically decrease over time.
The farm insurance policy I am able to offer my clients covers the residence as well as the farm, packaged together into one policy to streamline billing and make it so you have less paperwork to go through. If you own multiple residences on or off the farm, we can also include those residences on the farm policy.
Flooding is not covered by any companies' farm, homeowners, or business insurance in order to get coverage for flooding you will need to purchase a flood insurance policy. (We do sell these and can help find you the needed coverage for your property.)
Natural disasters such as wind, hail, tornados can be covered by the policy.
All of our life insurance products are underwritten on a case-by-case basis and as a result some life insurance cases can be issued without a medical exam, but others require a medical exam. This is so we can offer the best pricing to the client with the lowest level of inconvenience. If we are able to get the best rates without a medical, then no medical will be required. Medical exams are only required when we are unable to get you the best rate without one.
Term life insurance is purchased for a set time period or "term" of your life, while whole life insurance is purchased for your whole life.
Term is typically used for protecting your loved ones from debts that you have or loss of income that is needed for a set period of time. Examples of this are a mortgage, car loans and other types of debt or buying a policy to replace your income when you have kids or when you get married. This makes it so that if you do pass unexpectedly, your income will be paid to your beneficiaries, and you will not leave behind a financial burden on your loved ones.
The contestable period is the time that the insurance company has to determine after a policy is issued if there was any fraud or willful withholding of information on a life insurance application. If you lie on a life insurance application and the insurance company finds out during the contestable period, the company will not pay out the death benefit and will instead refund you your premium. This is because the withholding of any information on a life insurance policy is considered fraud and so the insurance company no longer has a legally binding contract with you from the moment the fraud occurs forward.
The contestable period typically lasts 2 years and would restart anytime a new policy is issued or a lapse in coverage occurs.
Some types of business insurance are required by law and others are not. This is dependent upon permits, licenses, and other requirements of the industry you are in. Call one of our licensed professionals today to determine if you are covered for everything you are legally required to have coverage for.
Yes, your business insurance is almost always a tax-deductible business expense.
Business insurance is there to protect you against unexpected catastrophic events. Having insurance allows you to not need to have as much cash on hand in order to be prepared for the unexpected. This allows you to invest that money into your business and have lower cash reserves than you would have if you were self-insured.
Self-insurance is when you decide not to have an insurance policy in place to cover the risk of loss. This requires an individual to pay for all of the expenses associated with repairing, fixing, or replacing what was damaged.
It is not financially reasonable to insure against every risk your business has and as a result most of our client's insurance plans consist of a combination of self-insurance and insurance policies. We work with you and your specific business needs to determine what is best covered by a policy and what is best self-insured.
Homeowners insurance has 6 major coverage parts to it.
- Dwelling - this part covers the structure of the house. The walls, roof, and any permanently affixed equipment or furniture.
- Other Structures - This part covers detached garages, she-sheds, and buildings on the property of that nature.
- Personal Property - This covers the contents of the house. If you could hold the house in your hand, take off the roof and then flip it over and shake it, everything that would fall out is personal property.
- Loss of Use - This pays for a hotel or rental in the event that there is damage to the house, and you are no longer able to live there.
- Personal Liability - This covers you in the event that you are personally in a lawsuit for damages you or your kids caused to someone.
- Medical Payments - This will pay for medical expenses if someone gets injured on your property regardless of fault, so long as they sign papers agreeing to not sue you for further damages.
A renter's policy has all of these same coverages except numbers 1 and 2, because the renter does not own the building or structures there is no need for those coverages.
The policy will pay for these things if there is a covered event, such as fire, wind, lightning, vandalism, etc. etc.
Review your specific policy with your agent or schedule a meeting with one of our agents to review what each part of the policy is specifically covering and for what amount.
Auto insurance has 5 major coverage parts to it.
- Liability insurance - this covers the damage you cause someone else if you are at fault or are the one who caused the accident.
- Collision - this covers your vehicle if you are in a collision minus your deductible.
- Comprehensive - this covers your vehicle if there is a fire, vandalism, falling object, etc. etc. minus your deductible. This is also where you get your class coverage, and you want to make sure your auto policy is endorsed to have full glass coverage. Full Glass coverage means there is no deductible on any glass claims.
- Personal Injury Protection - this is more commonly referred to as NO-FAULT insurance - this helps pay for medical bills, lost wages, funeral expenses, etc. etc. for individuals in your vehicle no matter who is at fault.
- Uninsured/Underinsured Motorist Protection - this covers individual in your vehicle in the event you are in an accident that is caused by someone who does not have insurance or does not have enough insurance to pay for the damages caused to you and your passengers. This coverage cannot be higher than your liability limits (#1 on here) but should always match your liability limit.
Even if you do not get a quote from us or contact us, we strongly encourage you to go check your Uninsured/Underinsured Motorist Protection and make sure it matches your Liability limits, and if it does not call your agent immediately to have it updated. The cost is minimal, but the impact in the event of an accident on your financial situation can be massive.
The easiest way to think about personal property coverage on a homeowners or renters insurance policy is as contents coverage. So, if you could hold your house or apartment in your hand and take the roof off, if you flipped it over and shook it, everything that falls out is contents and is insured under personal property.
This is subject to policy limitations. You should review your policy with your agent or with one of our agents for specifics, but limitations typically exist for jewelry, furs, coins, cash, firearms, collectibles, antiques, etc. etc.
A deductible is the amount you will have to pay in the event of a claim. This is a form of self-insurance that allows you to take on a portion of the risk without taking the full risk. A higher deductible requires you to have more cash in the bank to be prepared for a claim, but also lowers your insurance premiums. Having the correct deductible is essential to having an insurance plan that will work properly for you in the event of a claim.