THE TOPIC

With the recent earthquake in California, we through we would share some insight into earthquakes and insurance.  Earthquake, at least for insurance purposes, is defined as a sudden and rapid shaking of the earth caused by the shifting of rock below the earth’s surface.

Earthquakes are not covered by a standard homeowners insurance policy.  Coverage must usually be purchased via an endorsement or on a separate policy.  Also, according to the U.S. Geological Survey the U.S. experiences approximately 20,000 earthquakes a year.

As development increases in seismically active areas so does the risk for loss when an earthquake hits.   In July 2014 the U.S. Geological Survey updated its U.S. National Seismic Hazard Maps. The new maps reflect the best and most current understanding of where future earthquakes will occur, how often they will occur, and how hard the ground will likely shake as a result.

The new maps show that 42 states are at risk, with 16 states that have experienced earthquakes with a magnitude 6 or greater and which are considered at high risk.

Earthquake hazard is especially high on the West Coast, the intermountain west and in several active regions of the central and eastern U.S.

EARTHQUAKE INSURANCE COVERAGE

As there are no national earthquake programs, coverage is usually purchased through a private insurance company.  (However, some states, like California, have put together state programs.)

  1. Private Insurance Company:  Just like with flood insurance, there are several insurance companies that have put together programs for earthquake insurance you can purchase separately or in conjunction with flood and landslide coverage.
  2. Your Current Homeowner’s Policy.  There are some states where you are actually able to purchase earthquake coverage through your homeowners insurance policy.

Items to Note:

    • Your deductible is almost always a percentage of the coverage limit (typically 5%).
    • Pay special attention to your policy if you purchase earthquake coverage through your homeowners insurance company.   While you will have coverage for earthquakes, your policy will most likely exclude everything else related to land movement, including landslides/mudslides.

If you would like to find out more about earthquake insurance, please contact our office.

If you have children, it’s so important that you have them properly secured in their carseats while driving.   While child safety seats are wonderful at preventing potential injuries in an accident, wrong usage of them is very common.  When you think about it, even a small error in how the seat is used versus how it should be used can be the cause of serious injury or accident.

The following list of tips will help ensure you are using your carseat safely:

  1. Never put an infant in the front seat of a vehicle with a passenger air bag.
  2. Route harness straps in lower slots at or below shoulder level.
  3. Keep harness straps snug and fasten the clip at armpit level.
  4. Make sure the straps lie flat and are not twisted.
  5. Dress your baby in clothes that allow the straps to go between the legs. Adjust the straps to allow for the thickness of your child’s clothes.
  6. To keep your newborn from slouching, pad the sides of the seat and between the child’s legs with rolled up up diapers or receiving blankets.
  7. Put the car seat carrying handle down when in the car.
  8. Infants must ride in the back seat facing the rear of the car. This offers the best protection for your infant’s neck.
  9. Recline the rear-facing seat at a 45-degree angle. If your child’s head flops forward, the seat may not have reclined enough. Tilt the seat back until it is level by wedging firm padding such as a rolled towel, under the front of the base of the seat.

Do not use a car seat if any of the following apply:

  1. It is too old. Look on the label for the date it was made. Most carseats now have an expiration date where you are not supposed to use the seat past that date.
  2. It does not have a label with the date of manufacture and model number. Without these, you cannot check on recalls.
  3. It has been in a crash. If so, it may have been weakened and should not be used, even if it looks all right.
  4. It does not come with instructions. You the instructions to know how to install and use the car seat properly. Do not rely on the former owner’s instructions. Get a copy of the manual from the manufacturer.
  5. It has cracks in the frame of the seat.
  6. It is missing parts. Used seats often come without important parts. Check with the manufacturer to make sure you can get the right parts.

What does my credit rating have to do with purchasing insurance?

Everyone knows that credit scores are an evaluation of your payment history on a variety of consumer debt items like your home, credit cards, auto loans, etc.  Credit scores are also used for a variety of other purposes such finding a place to live, getting a cell phone, and, most recently, buying insurance.
Insurance companies have found a direct correlation between one’s credit score and likelihood of filing an insurance claim at some point in the future.  According to the actuarial tables and statistics the lower your credit score, the more likely you are to file a claim. So insurance companies are knowing using credit scores to generate an “insurance score” as part of the underwriting process.  Your insurance score plays a large role in determining the premiums charged by your homeowners and auto insurance companies.
Therefore a solid credit history can go a long way to decreasing your insurance premiums.  We recommend checking your credit score regularly and requesting that any discovered errors are immediately corrected.
The Fair Credit Reporting Act (FCRA) requires each of the nationwide consumer reporting companies—Equifax, Experian, and TransUnion—to provide you with a free copy of your credit report, at your request, once every 12 months. For more information, go to the Federal Trade Commission’s Web site on credit.


Insurance doesn’t only just have to be for protecting your home, auto, family or your business.  Insurance is available for protection against almost anything as long as it poses a potential financial impact and you are willing to pay the associated premiums.

Below are five examples of the most unusual types of insurance policies ever written.  They range anywhere from insuring a mustache, catching the Loch Ness Monster, or unexpected twins.

While we would certainly welcome the opportunity to write insurance for catching mythical creatures, our expertise will always be in protecting you and your family.

If you ever have a question or concern with your own policy, please don’t hesitate to reach out to our office.


1. Protecting Your Investment
It’s not uncommon for companies to pay celebrities a lot of money to promote their products.  However, did you know those same companies often take out insurance policies on the endorser just in case something happens?
For example, Head & Shoulders insured Troy Polamalu’s hair for $1 million and Braun insured Heidi Klum’s legs for $2 million.
Also, while playing on Australia’s national cricket team from 1985 to 1994, Merv Hughes took out an estimated $370,000 policy on his trademark walrus mustache
2. Insuring Against the Improbable
There are a variety of strange policies available to protect yourself, your family or your company from improbable events. For example, expectant parents have taken out insurance policies to cover the potential financial impact of surprise twins or triplets.
One company purchased an insurance policy as a hedge for a promotion that offered one million pounds for anyone who could capture the Loch Ness Monster.There are even policies available for employers where two or more of their staff win the lottery and do not return to work.  The coverage helps the employer to replace them.
 3. Safeguard the Senses
In 2008, Dutch winemaker Llia Gort insured his nose for $8 million.  Gort claimed his nose could distinguish millions of different scents.  As a condition of the policy, Gort is prohibited from winter sports, boxing or fire breathing (yes, fire breathing).
Not to be outdone, chief taster Gennario Pelliccia insured is tongue for $14 million in 2009.
4. Preserving Valuable Assets
Entertainers and professional athletes will often take out insurance policies against the potential loss of income if they’re unable to perform due to injury or other accident.
Soccer star David Beckham had his legs insured for $70 million while “Lord of the Dance” Michael Flatley insured his for $40 million.
Music legend Bruce Springsteen insured his voice for $6 million and KISS front man Gene Simmons covered his tongue for $1 million.
5. Insuring A-Listers
Award shows consist of much more than just the red carpet and acceptance speeches.  For example, Lloyd’s of London not only insures the Oscars show itself, but also provides over $40 million in coverage for the jewelry adorning all of the guests.
They have also insured a variety of unique items for movie stars.   They have provided coverage against an actor’s eyes becoming uncrossed (they never did), actresses’ legs, a waistline, and even a mustache.
One studio even took out an insurance policy against the possibility that one of its actresses would get married before her contact was up.

Did you know there are different types of home insurance.   Each policy type varies dramatically in the coverage it provides.  The following types of homeowners policies are fairly standard across the country though they might differ slightly in coverage or name across different states.

If you own the home you live in, you have several policies to choose from. The most popular policy type is the HO-3, which provides the broadest coverage.
Policy Types: 
HO-1: Limited coverage policy
This “bare bones” policy covers you against 10 named disasters (fire, lightning, and wind to name a few). It’s no longer available in most states.

HO-2: Basic policy

A basic policy that provides protection against 16 named disasters instead of 10. There is a version of HO-2 designed for mobile homes.
HO-3: The most popular policy
This “special” policy protects your home from all perils except those specifically excluded.

Coverage Levels
Besides the different policy types, there are also varying degrees of claim payment.  The following list outlines each one.

  1. Actual cash value.  
    This type of policy pays to replace your home or possessions minus a deduction for depreciation.
  2. Replacement cost.  
    The policy pays the cost of rebuilding/repairing your home or replacing your possessions without a deduction for depreciation.
  3. Guaranteed or extended replacement cost.  
    This policy offers the highest level of protection. A guaranteed replacement cost policy pays whatever it costs to rebuild your home as it was before the fire or other disaster–even if it exceeds the policy limit. This gives you protection against sudden increases in construction costs due to a shortage of building materials after a widespread disaster or other unexpected situations. It generally won’t cover the cost of upgrading the house to comply with current building codes. You can, however, get an endorsement (or an addition to) your policy called Ordinance or Law to help pay for these additional costs. A guaranteed replacement cost policy may not be available if you own an older home.Some insurance companies offer an extended, rather than a guaranteed replacement cost policy. An extended policy pays a certain percentage over the limit to rebuild your home. Generally, it is 20 to 25 percent more than the limit of the policy. For example, if you took out a policy for $100,000, you could get up to an extra $20,000 or $25,000 of coverage.Even though a guaranteed/extended replacement cost policy may be a bit more expensive, it offers the best financial protection against disasters for your home. These coverages, however, may not be available in all states or from all companies.

One of the questions we frequently receive from our Denver and Arvada clients is what coverage their homeowners insurance policy specifically covers.
A standard homeowners insurance policy includes four essential types of coverage:

  1. Coverage for the structure of your home.
  2. Coverage for your personal belongings.
  3. Liability protection.
  4. Additional living expenses in the event you are temporarily unable to live in your home because of a fire or other insured disaster.

1. THE STRUCTURE OF YOUR HOUSE

This is the primary coverage provided by a homeowners insurance policy and pays to repair or rebuild your home if it is damaged or destroyed by a covered claim.  It’s important to note that damage caused by a flood, earthquake or routine wear and tear and not included in standard homeowners policies.  Also, when purchasing coverage for the structure of your home, it is important to buy enough to rebuild your home.

2. YOUR PERSONAL BELONGINGS

Your furniture, clothes, and other personal items are covered if they are stolen or destroyed by a covered claim on your policy.  The limit of insurance provided is usually a percentage (typically 50 – 70%) of your home’s dwelling limit.

Most insurance companies include off-premises coverage as part of the policy. This means that your belongings are covered anywhere in the world. Some companies limit the amount to 10% of the amount of insurance you have for your possessions.

It’s also important to note that expensive items like jewelry, furs and silverware are covered, but there are usually dollar limits if they are stolen. Generally, you are covered for between $1,000 to $2,000 for all of your jewelry and furs. To insure these items to their full value, purchase a special personal property endorsement or floater and insure the item for it’s appraised value.

3. LIABILITY PROTECTION

Liability covers you against lawsuits for bodily injury or property damage that you or family members cause to other people. It also pays for damage caused by your pets.

The liability portion of your policy pays for both the cost of defending you in court and any court awards—up to the limit of your policy. You are also covered not just in your home, but anywhere in the world.

Your policy also provides no-fault medical coverage. In the event a friend or neighbor is injured in your home, he or she can simply submit medical bills to your insurance company. This way, expenses are paid without a liability claim being filed against you. You can generally get $1,000 to $5,000 worth of this coverage.

4. ADDITIONAL LIVING EXPENSES

This pays the additional costs of living away from home if you cannot live there due to damage from a fire, storm or other insured disaster. It covers hotel bills, restaurant meals and other expenses, over and above your customary living expenses, incurred while your home is being rebuilt.

Coverage for additional living expenses differs from company to company. Many policies provide coverage for about 20 percent of the insurance on your house. You can increase this coverage, however, for an additional premium. Some companies sell a policy that provides an unlimited amount of loss-of-use coverage, but for a limited amount of time.

If you have any additional questions on homeowners insurance; or, if you would like to receive a FREE insurance quote, please don’t hesitate to contact our office.

Over the past few weeks we have been providing tips and tricks for saving on auto insurance.   So this week we thought we would provide the top ways you can save money on your home insurance.

1. Ask for discounts

The quickest way to save money on your home insurance is to take advantage of the discounts available to you.   For example you may be able to add the following discounts to your policy:

  • Multi-policy discounts
  • Senior citizen discounts
  • Nonsmoker discounts
  • Claim-free discounts
  • Marital status discounts

Every insurance company offers different discounts, so we recommend working with an independent insurance agent to find out the what discounts are available to you.

2. Install security features

In 2009, burglary victims (in all structures, including homes) lost an estimated $4.6 billion to property damage and theft, according to the FBI.
Your insurance provider may offer discounts if you install safety features. For example, security features like deadbolts, fire extinguishers, and security alarms can add discounts anywhere from 5 percent to 20 percent.
3. Raise your deductible

Raising your deductible is one surefire way to lower your monthly homeowners insurance premium.  If you can afford to go slightly more out of pocket in the event of a claim, then you could potentially save another 10 to 15 percent.

4. Disaster-proof your property

Adding stronger weather-resistant features to your home like storm shutters or better roofing material can lead to dramatic savings on your insurance premiums, especially in areas that are prone to disasters like high winds or flooding.

5. Review your insurance policy

We recommend reviewing your insurance policy every year to ensure that you not only have the right insurance coverage, but that you also aren’t purchasing unnecessary coverage as well.

6. Double check your property limits

This may sound obvious, but if you paid $200,000 for your house, you don’t need to have $200,000 worth of coverage, because part of the purchase price included the lot your house sits on. You should carry insurance coverage equal to the cost of rebuilding the structure.

7. Inventory your possessions 

Understanding the right limit to use for your stuff can save you money on premiums and help you tremendously in the event of a claim.

Final Note
While it’s always nice to save money on your insurance, we don’t ever recommend purchasing liability and property limits  at lower amounts than what will sufficiently protect you and your family.   It’s never a good idea to put your personal assets in jeopardy to save $50 on your premiums.

If you would like to see where you can save more on your insurance premiums, or if you would like some insurance quotes on your home, please don’t hesitate to give us a call.

Customers often ask us exactly what each coverage on their auto insurance policy does.  As policy language can be complicated and confusing, it can be difficult to understand how your policy is supposed to react in the event of a claim.

The Insurance Information Institute put together a nice infographic that outlines what each coverage is on an auto insurance policy and how it is designed to react in the event of a claim.  As always, if you have any coverage questions at all, please feel free to give our office a call.

We know that homeowners insurance is designed to cover your home and it contents.  Additionally, it provides liability protection for bodily injury and property damage for claims against you or members of your family.   It may also provide coverage for the loss of use of your home in the event of a claim.

However, there are some unusual items that you may not realize might also be covered by your homeowners policy.   The following seven claims are the most interesting claims we have seen successfully reimbursed by insurance companies.

It’s important to note, though, that every policy is different in coverage and the claims below may or may not be covered by your specific policy.  If you have a question or concern in regards to your coverages, limits, etc., please feel free to give our office a call.

1. Eaten Jewelry
Although animals are typically excluded from coverage, there was a case where a dog allegedly ate a piece of jewelry and the insurance company offered to buy the dog at an unbelievably high price in an effort to salvage the jewelry.

After the owner refused, the insurance company finally relented and paid for the lost jewelry, which may or may not have been sitting in the dog’s stomach.

2. Bug-Repellent Basement
A homeowner had pesticide stored in the basement of his home. After a fire at the home, the homeowner noticed that swarms of flies would come in to the basement die almost immediately. After experts from Cornell University were brought in to assess the damage, it was determined that the chemical, when heated by fire, actually dissolved into the concrete and became even more potent. As the pesticide was also toxic to humans, the house had to be demolished and rebuilt from the basement up.

3. A Dump Truck
A homeowner owned a full-size dump truck that he used for nothing else but to move firewood to and from his wood-burning stove. As the vehicle was not registered for the road and used for property maintenance, the vehicle was covered by the homeowners policy as personal property after it was destroyed.

4. A Wedding Relocation
A homeowner was supposed to have a wedding in his backyard for his daughter. However, a fire forced them to relocate the wedding to a hotel. The homeowner was able to claim the increased cost of the wedding under the ‘loss of use’ coverage on his policy.

5. Bad Wine
After a backup of a sewage pipe caused flooding to home, the repair crew used heat to speed up the drying process. The homeowners’ wine cellar was heated to approximately 85 degrees for almost 10 days while the repairs were done.

The effect of the heat destroyed all of the wine and the insurance company reimbursed the homeowner.

6. Expensive Ingredients
Expensive cooking ingredients such as imported olive oil are covered at full value, as long as the homeowner is not running a business out of the home.

So if you’re doing a lot of shopping at Whole Foods, we recommend you keep your receipts.

7. Animal Stampede
A homeowner lived next door to an individual that owned cows, horses, and goats. One day something spooked the animals so bad that they ran through the neighbors fence and actually destroyed part of the insured’s home.

As the animals were not the homeowners, his insurance policy paid for the damage caused by the animals.