Property insurance faces big changes in 2023, says insurance broker
“The fires and storms made 2022 one of the most costly years for the insurance industrywhich led to the bankruptcy of several companies throughout the country”, says Carlos Susman (opens in a new tab), a Los Angeles-based insurance broker. “Unlike ‘what happens in Vegas stays in Vegas,’ when it comes to homeowners insurance, what happens anywhere in the country has the potential to affect the rates we all pay for coverage” .
A longtime friend of this column, Susman has been an insurance broker for more than 30 years, has an MBA from Columbia University, and serves as an expert witness in lawsuits involving coverage issues and agent negligence. .
Increase in rates and reduction of some important coverages
“Dennis, for your readers purchasing a new or renewed property or commercial policy in 2023, you have an important obligation for themselves: It is knowing and understanding the coverage they are paying for. This is a time to carefully not only read, but study your insurance policy, as some coverages that were fairly automatic may no longer be included as standard in your policy.”
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Susman listed several important coverages to consider:
1. Medical cover for guests
Both your homeowners policy and your business policy should absolutely have no-fault medical host coverage. This will pay regardless of why a guest at your home or business gets hurt and incurs medical bills – no lawsuits, no questions asked, her bills are paid.
He stresses: “Take the maximum amount of coverage you can get, since the cost per year will be less than two drinks at Starbucks.”
2. Event insurance and wedding cancellation coverage
What if I am planning to have a large event at my home or business?
“Event insurance coverage is a smart and inexpensive investment ($200-$300) that helps protect you from liability if someone is injured or damages property at the venue. It may also include liability for liquor in case you are serving.
“Most insurers also offer wedding cancellation coverage, which refunds lost, non-refundable deposits if you must cancel or postpone for reasons beyond your control, but not ‘cold feet.’ You can also get coverage for gifts, photos, a wedding dress, tuxedos, and other items.”
3. Coverage suitable for jewelry
“Unfortunately, most people don’t know that jewelry is covered up to $1,500 on most policies, no matter where it’s located. However, it is possible to get a jewelry rider which covers, for example, expensive items kept in a safe that you take out for special occasions. It is extremely important to contact your agent or broker to let them know that you will be removing them from the vault to use them.”
Also, from the accounts of bewildered readers who have had the contents of their safe deposit box vanish, please note that the the contents of a safe deposit box are not insured by the FDIC (opens in a new tab) or the financial institution. And your bank will disclaim all responsibility.
Drugs, Minors, Substances or Illicit Acts
“Keep in mind,” notes Susman, “that, as a general rule, illegal substances or intentional wrongdoing are not covered by insurance. If someone from your family is awaybreaking bad‘, don’t expect your insurance company to step in and protect you.
“Marijuana is a drug, legal or not, and if you provide it to your guests, you take the risk that your insurance company will deny coverage if they get high, damage their stuff, or go off and damage other people’s property or property. people are hurt.
“If you are unsure about the legality of owning or using personal firearms, check with a local firearms office. ATF (Bureau of Alcohol, Tobacco, Firearms and Explosives) (opens in a new tab). Do not look for insurance that will get you out of trouble for something that is illegal.
Practical tips to avoid cancellation
“In order to save on premiums, insurance is a product you should try to avoid and you don’t want to get canceled for something you didn’t do that resulted in a big claim. So offer to pay for Uber or Lyft if your guests have had too much to drink.
“You don’t want anyone driving drunk, for your safety and the safety of others, as there is a chance you could be held liable if you get drunk on your premises. It’s also a good idea and very thoughtful to keep non-alcoholic drinks and mocktails on hand so people can stay sober and avoid the social stigma of not drinking in crowds.”
Susman was quick to stress the importance of dietary restrictions. “If you are told about peanut allergies and decide to ignore the warning, please be aware that a single peanut could cause anaphylactic shock in a guest and a lawsuit is likely.”
Don’t miss a payment and do what is recommended
Most of us have been a day late or even missed a premium payment, received a lapse notice, they quickly made it up and were reinstated. “DO NOT expect that to happen in 2023,” Susman cautions, “regardless of the reason he didn’t make that payment.”
It’s no secret that companies are trying to reduce their risk exposure, given the huge losses in 2022. There are fewer payment plans available, which means you have to write a big check all at once instead of making payments over time. weather. So if you can’t pay in full, for many people this means Uninsured.
Also, as several of my readers have commented, they receive letters from their insurance companies giving them specific instructions on how to make a loss less likely, often involving trees and branches sticking out of roofs.
“This increases the risk of a fire reaching your home, as well as roof damage from branches and foliage. So please make sure this is resolved immediately, or you risk canceling your policy.”
Susman’s advice? “Do what they say. It’s common sense. Don’t be a stingy.”
Increase your limits
Susman concluded our interview with a piece of “chill out” advice.
“Given the rising costs of everything, it’s important to have proper limits. You can easily call your agent and say, ‘Increase my coverage since things cost more money and take longer to repair.’ It’s the safest move you can make right now in a world of insurance uncertainty.”
Dennis Beaver practices law in Bakersfield, California, and welcomes reader comments and questions, which can be faxed to (661) 323-7993 or emailed to Lagombeaver1@gmail.com. And be sure to visit dennisbeaver.com (opens in a new tab).