Wednesday, December 12, 2012

Insurers Step up to Help Sandy Victims

As a result of Superstorm Sandy, insurance companies we represent have pledged more than $123 million to support recovery efforts throughout the East Coast. Two thirds of the corporate aid comes via direct monetary donations to charity organizations, like the American Red Cross.

The following is a partial list of our companies that have contributed monetary and other aid to Sandy storm victims:
  • The Travelers Companies announced a donation of $200,000 to each of the following organizations: the Mayor’s Fund to Advance New York City, the American Red Cross on Long Island, Hurricane Sandy New Jersey Relief Fund and the American Red Cross of Connecticut.
  • Nationwide Insurance sent humanitarian relief teams to New York and Pennsylvania to provide water, antibacterial wipes, personal hygiene items and other goods. The company also donated $300,000 to the American Red Cross Disaster Relief Fund.
  • The Hartford made a $250,000 contribution to the American Red Cross disaster relief efforts.

Monday, December 10, 2012

What Does The Election Mean For Employers And PPACA?


Now that President Obama has been re-elected, the Patient Protection and Affordable Care Act (PPACA) will move forward largely as the law was passed in 2010.

The law left the task of working out many of the details to various regulatory agencies and with many questions remaining unanswered, employers can expect that an enormous number of regulations will be issued between now and the end of 2013.

Of great interest to employers is the employer shared-responsibility ("play or pay") requirement. As of Jan. 1, 2014, employers who have 50 or more full-time employees must offer "minimum essential" (basic) medical coverage for their employees who work more than 30 hours per week- or pay a penalty of $2,000 per full-time employee, excluding the first 30 employees.

Employers who offer coverage that is not "affordable" or fails to provide "minimum value" must pay a penalty of $3,000 for each employee who receives a premium tax credit. Coverage is not "affordable" if the employee's cost of single coverage is more than 9.5 percent of income. Coverage does not provide “minimum value” if it is expected to pay less than 60 percent of anticipated claims.

Regulations are still needed to provide details on how the penalty will be determined and collected for employers who do not provide health coverage to their full-time employees, what exactly is the "minimum value" coverage that must be provided to avoid the penalties, and when dependent coverage is "affordable."

The health insurance exchanges are also scheduled to begin operation in January 2014. While PPACA is a federal law, the health insurance exchanges were designed to be operated by the states. If a state is unable or chooses not to create an exchange, the federal government will run the exchange on the state's behalf.

In addition to deciding whether to "play" (provide health coverage) or "pay" (the penalties), employers (including those with fewer than 50 employees) have a number of compliance obligations between now and 2014, including:


  • Distributing medical loss ratio rebates if any were received from the insurer
  • Expanding preventive care to include a number of women’s services
  • Issuance of summaries of benefits and coverage to all enrollees
  • Reducing the maximum employee contribution to $2,500, if the employer sponsors a health flexible spending account (FSA), beginning with the 2013 plan year
  • Withholding an extra 0.9 percent FICA on those earning more than $200,000 beginning in 2013
  • Providing information on the cost of coverage on each employee's 2012 W-2 if the employer issued 250 or more W-2s in 2011
  • Providing a notice about the upcoming exchanges to all eligible employees in March 2013
  • Calculating and paying the Patient Centered Outcomes Fee in July 2013 if the plan is self-funded
  • Working with the exchanges to identify those employees eligible for premium tax credits
  • Reporting to the IRS on coverage offered and available- first reports due in 2015 based on 2014 benefits
  • Limiting eligibility waiting periods to 90 days, beginning with the 2014 plan year
  • Removing annual limits on essential health benefits and pre-existing condition limitations for all individuals, beginning with the 2014 plan year


If you have questions about how these new regulations will affect your business, call Allied Brokers today. Visit our website at www.alliedbrokers.com for information about all the types of insurance we offer. Or call 1-888-505-7988 for a free rate quote.

Information provided courtesy of AEIS 306 6th Ave. Ste. B, San Mateo, CA 94401


Sunday, November 18, 2012

Suze Orman Thinks Long-term Care Insurance is a Good Idea - And You Pick the Best Option to Pay for It


In a recent “Ask Suze Orman” column, Suze discussed the limited-pay option for long-term care insurance (LTCI). She explained that many people don’t know about this option and recommended it as a great way to pay off your premiums while you are still healthy and in your wage-earning prime.

We agree. A big advantage of paying off your premium costs in 10 years is that you will avoid the nasty surprise many LTCI policyholders with ongoing payments are encountering: Their premiums can rise sharply over time. A 10-year plan insulates you from that risk.

Keep in mind that if you buy a regular LTCI policy, it should include an annual inflation adjustment for the simple reason that costs rise over time and you are buying something today that you may not use for 20 or 30 years.

On the other hand, a limited-pay plan will be more expensive than a longer premium schedule, and adding inflation coverage will increase it even more. But if you can afford both the limited-pay and the inflation option, you will be in great shape.

You can save money by skipping the cash-back option that would pay the “return of premium” to your heirs after your death. It is an expensive option and the money is better spent on an inflation rider. 

Call Allied Brokers for details about LTCI and the best option for your particular needs. Visit our website at www.alliedbrokers.com for information about all the types of insurance we offer. Or call 1-888-505-7988 for a free rate quote.

Suze’s full article appears in the November 2012 Costco Connection

Thursday, November 15, 2012

How to Deep-fry a Turkey without Burning Down Your House

You’ve seen the TV commercial about the annual spike in insurance claims due to fires caused by people trying to deep-fry turkeys for Thanksgiving. Although deep-fried turkeys taste terrific, it’s not a method for amateurs or friends who want to stand around the backyard drinking and cooking.

The deep-fat turkey fryer is dangerous in itself; the pot is filled with 3 gallons of boiling oil and it’s easy to tip over, spilling hot oil over a large area. Inserting the turkey without splashing oil on yourself is very tricky- and if you dribble some onto the burner, it can cause an inferno. Also, without thermostat controls, deep-fryers can overheat the oil to the point of combustion.

Here are some tips to minimize the dangers of deep-frying your turkey:
  • Fryers should always be used outdoors, on a solid level surface a safe distance from buildings and flammable materials.
  • Never use a fryer on a wooden deck, under a patio cover, in a garage or enclosed space.
  • Do not overfill the fryer.
  • Never leave the fryer unattended because the oil will continue to heat until it catches fire.
  • Never let children or pets near the fryer when in use or after use as the oil can remain hot for hours.
  • Use well-insulated oven mitts and wear long sleeves and safety goggles to protect from splatter.
  • Make sure the turkey is completely thawed before placing it in the fryer.
  • Keep all-purpose fire extinguishers nearby.
  • If a turkey fryer fire occurs, call 911 immediately.
If you plan on deep-frying your turkey this Thanksgiving, you should call Allied Brokers to review your homeowners’ insurance policy. We can help you be sure that any gaps in your coverage are filled in case something goes wrong.

Visit our website at www.alliedbrokers.com for information about all the types of insurance we offer. Or call 1-888-505-7988 for a free rate quote.

Wednesday, November 14, 2012

Protect Your Small Business from Disaster

With unpredictable weather on the rise, the time for small business owners to plan for disaster is now. Being unprepared can be costly- an estimated 40% of businesses don't reopen after a disaster. Of those that do reopen, 25% fail within one year.

Here are some key tips to protect your small business:
  • Recognize the potential threats that nature poses in your geographical area. Consider the usual types of events for your region, like earthquakes, as well as the freak ones that may not be the norm, like tornados in Palo Alto. Then take measures to reduce or eliminate your exposure. A structural engineer or your community building or zoning offices can identify ways to shore up your facility against the effects of earthquakes, high winds, flood and fire.
  • Make sure you have protective systems in place. For example, an emergency generator can provide power during outages. Surge protectors can prevent damage to electronic equipment.
  • Back up your computer data – regularly. This is a critical risk management step that most small business owners overlook. Make computer backup part of your daily operations and store copies of your files at an offsite location.
  • Develop a business continuity plan that identifies the specific steps your business will take to return to operation after a disaster. It requires time and effort, but in the long run, it can help reduce loss, save lives and speed your business' recovery.
  • REVIEW YOUR INSURANCE POLICY! Many businesses don’t discover that they're not properly insured until after they've suffered a loss. The results can be financially devastating.
Call us at Allied Brokers to review your insurance coverage, especially if you haven't done so in a while. Together we can determine if you have the right coverage – and the right amount of coverage – if your facilities are damaged or operations are interrupted for a period of time. This could include coverage for loss of business income or loss of perishable stock as well. Plan today to stay in business tomorrow.

Visit our website at www.alliedbrokers.com for information about all the types of insurance we offer. Or call 1-888-505-7988 for a free rate quote.

Wednesday, November 7, 2012

Fireman's Does the Right Thing for Its Clients

Fireman's Fund Insurance announced last week that it will provide a Blanket Extension of Coverage for policyholders who were hit by the storm. Customers get temporary leniency on premium payments and non-pay cancellations. They have until November 30, 2012 to pay insurance premiums due on or after October 27, 2012- without any late fees, penalties, or cancellation due to nonpayment. In addition, Fireman’s Fund is waiving deductibles for clients hurt by the storm.

Sunday, November 4, 2012

Beat the Tax Man with a Living Trust



Living trusts are all about avoiding probate fees, which can be in the tens of thousands of dollars. Basically, you appoint a trustee before your death who transfers ownership of your estate to the beneficiaries you’ve  already selected. In many cases, the whole process takes only a few weeks and there are no attorney or court fees to pay.


Here are answers to common questions about living trusts:

Is it expensive?
The cost of creating a living trust depends on what you want to achieve. The more complicated a living trust is, the more expensive it will be. The value, however, is in the money and time you will save by avoiding probate court.

Is a trust document ever made public, like a will?
A will becomes a matter of public record when it is submitted to a probate court, a living trust does not.

Does a trust protect property from creditors?
No, a creditor who wins a lawsuit against you can go after the trust property just as if you still owned it in your own name.

After your death, however, property in a living trust can be quickly and quietly distributed to your beneficiaries. By the time creditors find out about your death, your property may already be dispersed. Trusts are not public record so, except for real estate, creditors have no way of knowing exactly what you owned and are unlikely to go after the beneficiaries.

Probate, on the other hand, can offer a kind of protection from creditors. During probate, known creditors must be notified of your death and given a chance to file claims. If they miss the deadline, they're out of luck forever.

Do I need a trust if I'm young and healthy?
If you don’t own real estate, probably not; a will and perhaps some life insurance is sufficient.

Can a living trust save taxes?
A simple probate-avoidance living trust has no effect on either income or estate taxes. More complicated living trusts, however, can greatly reduce your federal estate tax bill if you expect your estate to owe estate tax upon your death.

If you're wondering whether you need a living trust, call Allied Brokers. We'll help you figure out the answer.

Visit our website at www.alliedbrokers.com for information about all the types of insurance we offer. Or call 1-888-505-7988 for a free rate quote.

Woman Commits Insurance Fraud From Ambulance


A Philadelphia woman was arrested last week in a very unusual case of insurance fraud. She wrecked her car and did not have comprehensive or collision insurance. Although injured, the woman called her agent from her gurney, en route to the hospital, to increase her coverage.

In an attempt to get her insurance company to pay for the damages to her car, she reported a claim shortly after the incident. The woman lied about when the accident occurred, claiming it was after she obtained the additional coverage. The story didn’t fly and the woman was arrested and charged with one count of insurance fraud and one count of “attempt to commit theft by deception”. She was released on $10,000 bail.

Repairs after an auto accident can be expensive; call Allied Brokers today to review your policy and fix any gaps in your coverage.

Wednesday, October 17, 2012

Capital Insurance Group (CIG) Increases Auto Rates 12%

Due to the higher costs of doing business in California and the increase in the number of uninsured/underinsured drivers, CIG is raising its liability rates. Effective December 1, 2012, these changes will take effect:
    • Average liability rates up 12%
    • Average physical-damage rates down 10% 
    • Transportation expense-extended coverage rate up $2 per vehicle 
    • Roadside protection plan up $1 per vehicle
There will also be some auto program enhancements:
    • Good student discount of 3% available for any student 25 or younger who maintains at least a B average
    • Smart Teen Driver discount of 5% for anyone 19 or younger who completes the CHP’s Smart Teen Driver Program
    • New cost-saving deductible options of $5,000 for Comprehensive and $10,000 for collision
Most insurance companies are raising rates because they are currently losing money. Call us for a full review of your policy- we can look at ways to lower your rates or switch you to one of our other companies.

Five Important Tips on Gambling Income and Losses


Whether you roll the dice, bet on the ponies, play cards or enjoy slot machines, you should know that as a casual gambler, your gambling winnings are fully taxable and must be reported on your income tax return. You can also deduct your gambling losses...but only up to the extent of your winnings.

Here are five important tips about gambling and taxes:

1. Gambling income includes, but is not limited to, winnings from lotteries, raffles, horse races, and casinos. It includes cash winnings and the fair market value of prizes such as cars and trips.

2. If you receive a certain amount of gambling winnings or if you have any winnings that are subject to federal tax withholding, the payer is required to issue you a Form W-2G, Certain Gambling Winnings. The payer must give you a W-2G if you receive:
  • $1,200 or more in gambling winnings from bingo or slot machines
  • $1,500 or more in proceeds (the amount of winnings minus the amount of the wager) from keno
  • More than $5,000 in winnings (reduced by the wager or buy-in) from a poker tournament
  • $600 or more in gambling winnings (except winnings from bingo, keno, slot machines, and poker tournaments) and the payout is at least 300 times the amount of the wager
  • Any other gambling winnings subject to federal income tax withholding
3. Generally, you report all gambling winnings on the "Other income" line of Form 1040, U.S. Federal Income Tax Return.

4. You can claim your gambling losses up to the amount of your winnings on Schedule A, Itemized Deductions, under 'Other Miscellaneous Deductions.' You must report the full amount of your winnings as income and claim your allowable losses separately. You cannot reduce your gambling winnings by your gambling losses and report the difference. Your records should also show your winnings separately from your losses.

5. Keep accurate records. If you are going to deduct gambling losses, you must have receipts, tickets, statements and documentation such as a diary or similar record of your losses and winnings. 

This article was provided courtesy of Orlando, Mitts, Moore and Company Certified Public Accountants of San Jose. If you have questions about gambling income and losses, call them at: 408 278-0300.

Dog Buries Itself Alive to Win Coveted Swag Bag


Last October, Peanut, a dachshund-terrier mix with a hard-wired grudge against rodents, managed to bury itself alive in the dirt below the deck of its owner’s house following an epic battle with a skunk. It’s not clear what enraged Peanut the most; the skunk’s arrogant “don’t even think about it” attitude or the humiliation of getting sprayed in the face, but in the end, Peanut dug so furiously that all that could be seen of him was one paw sticking out of the dirt.

The owner had to call the fire department to dig Peanut out, administer oxygen and rush him to the vet, where he made a full recovery in two days. There was no word on the fate of the skunk; however witnesses reported seeing what looked like a skunk doing an end-zone dance not far from the incident.

Peanut’s owners faced big vet bills. They also had to repair the parts of their deck that the firemen tore up to rescue their dog. Fortunately, they had a policy with Veterinary Pet Insurance (VPI), a subsidiary of Nationwide Insurance.  This claim won Peanut VPI’s 2012 Hambone Award.

The Hambone Award is given to VPI’s most unusual pet claim of the year. Peanut received a bronze trophy in the shape of a ham, a VPI swag bag filled with toys and lots of treats.

Allied Brokers does not offer pet insurance, but call us for all of your human insurance needs. Visit our website at www.alliedbrokers.com or call 1-888-505-7988 for a free rate quote.

Wednesday, October 3, 2012

Mercury Insurance Boosts Auto Policy Rates 4.3%

On renewals effective October 26, 2012 or later, Mercury Insurance is revising its California Private Passenger Automobile program, resulting in a 4.3% overall rate increase. These rate increases are statewide averages, so each policyholder will be affected differently - your rate may go down or it may go up. If your rate goes up more than 4%, call us! Most companies are in the process of raising rates because they are all currently losing money. Call us for a full review and we can look at ways to lower Mercury's rates for you or switch you to one of our other companies.

Allied Insurance Offers Blanket Personal Property Policy

All homeowner's policies have limited coverage for valuable items that are likely to be stolen - sometimes as little as $1,000. Protect your jewelry, watches, furs, guns, cameras, musical instruments, golfing equipment - or whatever you value most- with Allied Insurance Company's new Blanket Personal Property Endorsement. It gives insureds the option to insure personal property, such as jewelry and fine arts, without having to specifically schedule each individual item or provide appraisals - with no deductible.

Sunday, September 30, 2012

Back to School Coverage for Your College Student

Allied Insurance makes sure that your child in college has all the coverage from your homeowner policy- so you’ll have peace of mind. The HO-27 endorsement extends liability and personal property coverage from your homeowner policy while your child is attending college away from home. If your child has access to a vehicle while away, auto coverage can be continued through your Allied auto policy at a discounted rate. Allied also offers an endorsement that covers theft and physical damage of your child’s computer. Call us today to discuss your options.

Thursday, September 27, 2012

Avoid Insurance Surprises When Buying or Selling a Home


Don’t let insurance surprises blow your real estate transaction! Here are some common deal-breakers:

1. You don’t pre-qualify for home insurance before escrow close.

Before escrow close, the title company will request proof-of-insurance from your insurance agent. If the amount of insurance does not meet the lender’s guidelines, you could lose the house of your dreams.

Let Allied Brokers review your policy well in advance of escrow close and the deadline for waiving the insurance contingency. And if your insurance agent is an employee of the insurance company that wrote the policy, he may not be able to do anything to solve the problem. Oops!

 As an independent insurance broker, we work with ten different carriers and will be able to get you the coverage you need- whatever your situation.

2. You don’t run an insurance claims history report on the property you are buying

If there are previous insurance claims against the property you want to buy, your insurance agent needs to know about these risks before escrow close. Some big companies, like State Farm, will not insure properties with any claims history. Your realtor should run a “clue report” to learn about previous claims.

Multiple claims guarantee difficulty getting insurance and higher premiums. Allied Brokers had a client in La Honda whose house was damaged twice by large trees falling on it. Since the house was in a forest and the surrounding trees were not chopped down, it’s likely the next big windstorm will cause more damage. Insurance companies won’t touch a property where future damage is so clearly predictable. Conversely, remedied claims are not much of a concern. If you were robbed but afterwards installed a burglar alarm, insurers won’t expect this claim to be made again.

3. If you, the buyer, have reported insurance claims at your prior residence

Two claims in a short period of time is a red flag to insurance companies and puts you in the top 5% of homeowners that will file a claim. If you have more claims within 5 years, you will be cancelled. We advise you to raise your deductible to $5,000 and spend the money you save on lower premiums to pay for repairs yourself. Insurance is for big risks you can’t afford to cover, not maintenance or the small stuff. If you are going to have a claim, have a big one.

4. If you are selling a home with the following conditions:
  • No electrical, plumbing, heating or roof upgrades in the last 20 years.   
  • Old wood roofs in wooded areas.
  • Fuses.
  • Galvanized plumbing.
  • No earthquake retrofitting if your home was built before 1960.
Most insurance companies decline coverage for these conditions. Some companies will give you time to make the proper repairs.

5. What about occupancy?

Will the home be owner-occupied, a vacation home or a rental? Will it be vacant or under construction? These all make a difference in what type of policy you should have and your agent needs to know this before placing the coverage. If not, you could be declined, or worse, your claim will not get paid.

Call Allied Brokers to avoid nasty surprises that can break a real estate deal. We provide free clue reports to realtors. Consult with us well in advance of escrow close to learn what the required coverage amounts are and then get pre-approved for them. We have the resources to solve any insurance problem.

Visit our website at www.alliedbrokers.com for information about all the types of insurance we offer. Or call 1-888-505-7988 for a free rate quote.

Health Plan Survey Cites Key Trends in Employer Health Plans



In spite of the passage of health care reform efforts, the 2012 United Benefit Advisors (UBA) Health Plan Survey says health care costs will continue to increase for both plan sponsors and their employees. The UBA is the nation’s largest independent benefits advisory organization. Here are some other trends in employer health plans:



1. Consumer driven health care plans (CDHPs) declined for the first time since 2007.

2. UBA Member Firms clients’ average renewal for all plan types increased 5%.

3. The average monthly employee contribution for plans with contributions for all plan types is $126 for single and $494 for family.

4. The average employers contribution to a health reimbursement arrangement (HRA) was down from 2011 for a single employee and up for a family. Employer health savings account (HSA) contributions continued to decline.

5. 81% of all wellness plans offered a health risk assessment.

6. 91% of all plans now offer an unlimited lifetime maximum benefit compared with 81% in 2011 and just 16% in 2010.

7. 48% of all covered employees also elected to cover their dependents, a 1.9% decline.

The intent of the survey is to provide employers of all sizes with the data they need to manage their health care benefit programs effectively- according to Ronald Bland of AEIS in San Mateo. Ron is a full service benefits broker with 30 years experience serving clients in the Bay Area. We have worked with him for 10 years and refer many of our business owner clients to him. Since all group health salespeople have access to the same products, Ron provides extra value with his service, support and know-how.

Ron can be reached at:  office: 650 348-6234 fax: 650 401-8261 ron@blandaeis.com | www.aeisadvisors.com

Sunday, September 16, 2012

Workers’ Compensation and the Independent Contractor Myth


As an employer, you may think your employee is an independent contractor based on IRS rules and payroll withholding. But under workers’ compensation rules, your independent contractor is considered an employee. If you don’t have a workers' compensation policy for that contractor, you will be on the hook for all the benefits due to injury, death, disability and lost wages.

The government wrote the rules to force employers to pick up the tab for these costs- not the state. The state almost always sides with the victim/employee against the employer. Protect yourself and buy a workers’ compensation policy.

A true independent contractor is an established business which has:

1. Their own general liability and workers’ compensation policy.
2. Their own business license.
3. Advertises their services to the public and has other customers.
4. Performs work not normally performed by you.
5. Supplies their own tools and materials.
6. Charges a fee rather than an hourly rate.
7. Has complete control of how they do their job.

Any one of the following may cause the Workers’ Compensation Commission to decide that an employee relationship exists:

If the independent contractor:

1. Is furnished and office.
2. Is given business cards that indicate they are part of your company.
3. Is paid hourly rather than a fee for a contract service performed.
4. If you supervise their time.
5. If you supervise how they do their job.

The state is forcing employers to pay more for employees’ care and there is no way around it. As deficits rise, look for more aggressive enforcement by government agencies. For questions about workers’ compensation and other business insurance, call Allied Brokers.

Visit our website at www.alliedbrokers.com for information about all the types of insurance we offer. Or call 1-888-505-7988 for a free rate quote.

Monday, August 27, 2012

Common Misconceptions About Probate

As you know, probate is necessary when an individual dies without the proper estate planning documents and his/her assets exceed $100,000. What you pay is based on the estate’s gross asset value, which means all that you own, not just what you owe. For example, if your home is worth $800,000 and your mortgage is $790,000, the gross asset value is $800,000.


This chart shows the minimum probate costs set by California law and do not include any special fees such as the sale of assets, tax preparation and litigation.


Gross Asset Value of Entire Estate
Probate Fees without Estate Planning
$400,000
$22,000
$500,000
$26,000
$750,000
$36,000
$1,000,000
$46,000
$2,000,000
$66,000
$3,000,000
$86,000
$4,000,000
$106,000

Did you know…?
  • A will is different from a trust.
  • If you have recently refinanced your home you have to put it back into your trust.
  • Without an Advanced Care Health Directive your family may not be able to manage your medical care.
  • Joint Tenancy, the way many couples hold property, does not avoid probate.
  • Joint tenancy may cost the second-to-die thousands of dollars in capital gains tax.
  • The inheritance tax exemption allowed by the IRS may be lowered from $7,000,000 to $1,000,000 in 2013.

THIS IS NOT THE TIME SKIMP, hire a professional estate planner! Allied Brokers can recommend several experts that we work with. You have been in control and protected your family your whole life, why stop now? MAKE SURE THE FRUITS OF YOUR LABOR GO WHERE YOU WANT IT GO- SMOOTHLY, PRIVATELY AND INEXPENSIVELY. Avoid a family fight by taking care of your business before you die.

Call Allied Brokers to learn about ways you can control the distribution of your assets from beyond the grave. We can help you estimate your estate tax liability and fund the tax debt for less than 5% of the amount you would have paid. What better investment can you make for your family?

Visit our website at www.alliedbrokers.com for information about all the types of insurance we offer. Or call 1-888-505-7988 for a free rate quote.

Demystifying Car Rental Insurance

Car rental insurance sometimes feels like a shake-down. You think your auto policy covers it, but you’ve never read the fine print and you really don’t want to end up in a Mexican jail, so you buy it anyway and drive away feeling like you’ve wasted money. Have you? Here’s what you need to know:

Domestic car rental:  Most personal auto insurance policies will extend the liability limits of your policy to protect you when you drive a car you own or when you drive a car you don’t own; (like a rental car or a friend’s car you borrow) when you drive in the US and Canada. Insurance in Mexico is a special problem and to play it safe we are recommending that you buy Mexican Auto insurance before you enter that country.

Foreign car rental:  If you rent a car in a foreign country, your US policy will NOT cover you for:
-          Liability
-          Comprehensive and collision
-          Medical
-         Uninsured and underinsured motorist coverage.

A client once emailed me from London to tell me that he had crashed his rental car. He hadn’t purchased insurance from the rental car company and wanted to know if he was covered by his US auto policy for collision coverage. He was NOT.

There are only a few companies that offer worldwide coverage; whereas this type of coverage may be right for the international business traveler, it’s expensive for those of us who seldom take a vacation abroad. For the infrequent foreign traveler, we recommend you buy complete insurance from the rental company you use and make sure it covers any and all drivers.

Credit Cards Most credit card companies provide domestic and worldwide coverage for damage to rental cars- IF YOU USE THEIR CARD TO PAY FOR THE RENTAL CAR. Luckily for my client in London, he had paid for his rental with his American Express card and they paid for the majority of the claim.

Credit card coverage has many restrictions, so READ THE FINE PRINT:

  •  Many countries are excluded, i.e.: My client was covered in England but not Ireland.
  •  If you get a DUI, your insurance may be invalidated.
  •  There are usually many restrictions regarding accidents.
  •  Platinum cards are important; the better the card, the better the coverage.
  • Credit card coverage usually excludes liability for injury to the other driver and damage to his car.

Before you plan a trip, call Allied Brokers. We can review your auto policy, answer your questions and make sure you are covered. We are here to help you solve all your insurance problems!

Wednesday, August 22, 2012

4 Business Insurance Pitfalls to Avoid

Business interruption insurance
More than 50% of businesses never reopen after a fire because fire insurance does not cover income downtime". It also does not cover temporary relocation, salaries for key employees, or the additional costs involved in rebuilding. “Business interruption” is optional coverage that you should seriously consider adding if your business will be destroyed by being closed. Most business income policies only pay for 12 months of lost income but longer terms are available.

Actual cash value versus replacement cost
Most business policies cover a fire loss with “actual cash value” instead of “replacement cost”. Not good. Actual cash value pays the amount of the property less depreciation. This can be devastating if your business relies upon high value equipment that has a long life, but would be prohibitively expensive to replace. Replacement coverage, on the other hand, pays whatever the lost property’s replacement cost is today.

Coverage to rebuild according to current building code
Many businesses work in structures that are older than current building codes. In some cases, the structures are "grandfathered" and do not have to comply with current modern standards. When a fire occurs, however, the new construction must meet those standards and the extra cost is not covered. If you have a historic building, make sure you buy a rider to cover the cost to rebuild to current codes.

Always insure for 100% of your business value
If your business is insured for less than it’s worth, and a loss occurs, a penalty is applied to the settlement amount. This penalty will almost always exceed the amount of money you saved on premiums and will come at a very bad time. Have an independent appraiser evaluate your business each year and adjust coverage as necessary.

Could you rebuild your business if it burned to the ground? Come into Allied Brokers for a review of your current policy. We’ll point out gaps that could put you out of business for good.

Visit our website at www.alliedbrokers.com for information about all the types of insurance we offer. Or call 1-888-505-7988 for a free rate quote.

Tuesday, August 21, 2012

Triple Tax Whammy Looms for Business Owners

Small business owners face a potential triple-whammy in 2013 if Congress doesn’t renew the Bush-era cuts. The first smack is the estate tax exemption which is scheduled to drop from $5,120,000 in 2012 to $3,500,000 in 2013, and the estate tax rate is scheduled to jump from 35% to 45%. Similarly, the current lifetime gift tax exemption will drop from $5,120,000 to only $1,000,000.

If your estate planner tells you that this is a good year to die, it’s no joke; starting in 2013 your heirs may have to sell the family business you’ve left them in order to pay estate taxes.

The second punch is the Affordable Care Act’s 3.8% tax individuals who make more than $200,000 per year and couples, $250,000 per year. Add that to the proposed capital gains tax increase from 15% to 23.8% for those with incomes over $250,000, and business owners are really kicked where it hurts. (Capital gains are defined as income from sources other than wages, such as business income, bonds, dividends and interest.)

To push more people into “top 2%”, Obama is taking aim at estate planners. Currently, the law treats a grantor and a trust as the same person when it comes to paying income tax. If there are transfers between the two, no income tax is paid. In addition, some grantor trusts are considered to be separate from the person who created the trust, so there is no estate tax on the trust assets when the creator of the trust dies. All this will change if Obama is successful in merging income tax rules and estate tax rules.

Over the years, more and more people will be caught by the new taxes because the adjusted gross income level that triggers them doesn't rise with inflation. What can you do? First, meet with a professional estate planner to learn how the new laws might affect you. If you don’t know any, Allied Brokers can refer one.

Then call Allied Brokers to learn about insurance options that can protect your heirs from both capital gains and inheritance taxes after you die. For example, there is inheritance tax insurance that pays back your family trust the amount it loses to the IRS when you die. Let us help you control the distribution of your assets from beyond the grave.

Visit our website at www.alliedbrokers.com for information about all the types of insurance we offer. Or call 1-888-505-7988 for a free rate quote.

Monday, August 20, 2012

Protect Your Business with the Right Insurance

Having the right kind of insurance is critical to your business and multiple policies should be in place before you even open your doors. These policies should also be reviewed every year or whenever a business change occurs, like a move or a new product.

Allied Brokers offers all of the following kinds of business insurance:

Commercial Business Insurance

Commercial Property Insurance policies protect your office and its contents from damage caused by natural disasters, fires, or vandalism. They are either all- inclusive or risk specific.

Product Liability Insurance is necessary if you manufacture or sell products- it safeguards you if a product defect injures someone.

For protection against lawsuits related to negligence claims, you need to consider both General Liability Insurance and Professional Liability Insurance.

Other types of insurance your business might need include:

  • Coverage that protects Directors and Officers from personal liability
  • Key Executive Life Insurance
  • Business Interruption (covers lost profits and expenses)
  • Commercial Vehicle Insurance
  • Website Insurance (protects you from legal claims)

Employer-Related Insurance

Workers' Compensation Insurance and Unemployment Insurance (under certain conditions) are mandatory. California also requires employers to provide Disability Insurance to employees who are unable to work because of illness or injury. Some tips to make sure you get the correct insurance for your business:
  • Don't under-insure, but don't over-insure either.
  • Assess your liability risk honestly and thoroughly.
  • Ask your lawyer for advice.
  • Get quotes from several companies.
  • Ask how you can minimize risk and premiums.
Allied Brokers is your ally if you encounter legal problems because of an accident or injury that happens to someone on your property, to an employee doing business for you, or if a service you provide causes harm to someone. Avoid lawsuits- come in and let us help figure out the best kind of insurance to protect your business!  

Visit our website at www.alliedbrokers.com for information about all the types of insurance we offer. Or call 1-888-505-7988 for a free rate quote.  

Information for this article was provided courtesy of Orlando, Mitts, Moore & Company financial planners: 408 278-0300

Thursday, August 2, 2012

Covered or Not Covered...?

State Farm Insurance recently filed a lawsuit against former Penn State assistant football coach Jerry Sandusky. Sandusky, the convicted child molester, had asked the insurer to pay for the legal costs of his criminal defense.

State Farm said NO WAY! They argued that although homeowners’ insurance can offer coverage for claims arising from the insured’s negligent acts, it does not cover intentional ones. The lawsuit is still under litigation but it’s pretty clear that Sandusky doesn’t have a chance with State Farm. The outcome is a little murkier for Federal Insurance, the second insurer Sandusky asked to pay for his defense costs.

Federal had issued a directors-and-officers liability and employment practices liability policy to The Second Mile, a youth charity group founded by Sandusky. The challenge here will be defining exactly at what point, and in what situation, negligence become intention. Isn’t directors-and-officers liability insurance all about bad behavior, like sexual harassment? And isn’t all bad behavior intentional? Surely hairs will be split.

Tuesday, July 24, 2012

Don’t Sabotage Your Escrow Close

Listen to your realtor and mortgage broker- they are the experts! Last week a realtor recommended that her client call us to review their policy well in advance of escrow close and the deadline for waiving the insurance contingencies.

The realtor, being an experienced professional, wanted to get her ducks in a row. She did not want to risk her client being denied the LOAN and risk losing the 3% DEPOSIT and the HOUSE, just because they did not get insurance on time.

The client never called us, choosing instead to use their current agent, who said everything was fine and not to worry. BIG MISTAKE- 24 hours before escrow close, the title company requested proof-of-insurance from the client’s agent. The company refused to meet the lender’s requirements. Since the agent was a company EMPLOYEE, he could not do anything to solve the problem. WHOOPS!

The realtor called Allied because we are an independent insurance broker. Since we work with, NOT FOR, over ten different carriers, we were able to get coverage for her client just in time. Whew, disaster averted!

This happens all the time. There are other insurance pit-falls that can break a real estate deal. We run all the required reports in advance for all our customers. Brush proximity, earthquake and flood exposure as well as prior claims are nasty surprises that buyers and sellers can avoid. Consult with Allied Brokers in advance of escrow close to find out what the required coverage amounts are and then get pre-approved for them. We have the resources to solve any of these problems. That’s why so many realtors and mortgage brokers recommend us to their clients.

Visit our website at http://www.alliedbrokers.com/ for information about all the types of insurance we offer. Or call 1-888-505-7988 for a free rate quote.

Top 5 Reasons Why People Don’t Buy Earthquake Insurance

As a Californian, you are always waiting for the other shoe to drop. Sure, you’ve thought about earthquake insurance, but you talked yourself out of making the call because you assumed…

It’s too expensive-Insurance is meant to cover the losses you can’t afford to pay. $1,500 for insurance to rebuild a $600,000 home is a reasonable price for such a big risk. Our company’s biggest insured loss was with Fireman’s Fund for $900,000. It happened in Los Gatos during the Loma Prieta quake when a Victorian jumped completely off its foundation.

The deductible is too high - Yes, 15% is high, but insurance companies would go broke fixing every piece of cracked stucco. Earthquake insurance is for major damage only- like when the same quake caused another client’s swimming pool to empty completely into his house.

The state will bail me out - Seriously? The State’s broke- don’t count on it.

Insurance companies will go bankrupt - Ok, some might. 21st Century almost did after the 1995 Northridge quake and pulled out of the California homeowner’s market. Allied Brokers, however, represents the only strongest companies in the industry and we steer our clients away from “shaky” carriers.

It will never happen to me - Maybe… or maybe not; how lucky do you feel? Case-in-point: an Allied Brokers client bought a house in Santa Cruz just one month before the Loma Prieta quake. He purchased a normal homeowner’s policy but passed on the earthquake insurance. He gambled that he would never need it. His chimney collapsed and his floors and foundation were severely damaged- to the tune of $60,000. Don’t let the Big One get you! Call Allied Brokers today.

Visit our website at http://www.alliedbrokers.com/ for information about all the types of insurance we offer. Or call 1-888-505-7988 for a free rate quote.

Buy Local, Hire Local, Support Local: Say NO to Call Centers and Outsourcing

Time Magazine recently reported that Aetna, the US’s third largest health insurer, has partnered with Costco to offer individual health care policies to its customers in nine states- Connecticut, Illinois, Texas, Michigan, Virginia, Georgia, Arizona, Pennsylvania and Nevada- as well as lower co-pays for customers who use Costco pharmacies. Aetna says its Costco plans are about 5% cheaper than the individual policies it normally offers and intends to add more states later this year.

Insurers, financial firms and retailers are anticipating that millions of uninsured people will have to buy health care by 2014 under the new Affordable Care Act and have been experimenting with ways to attract new customers. Humana now offers prescription drug plans through Wal-Mart and Aetna has also teamed up with Best Buy to sell supplemental wellness plans. Health insurance has become the Wild West and major carriers will continue making land grabs at big-box stores.

Unfortunately, Progressive and Hartford AARP have also joined in on the commoditization of what remains a complicated and personal product. Service and expertise will soon be a thing of the past. Buyers beware- anyone who chooses a carrier based on price alone deserves what they get when they submit a claim that is not covered.

Allied Brokers hires and trains the best local professionals so we can provide top-notch service and expert advice for our clients. Call us if you want a dedicated agent who knows you and can educate you on the  best choices for your unique insurance needs. You will get a real person who remembers your name and your previous conversation. We have an office on Cowper St. you can visit- and if you want to talk to the owner, he is there every day. Availability and accountability are among our core values.

By working with us, you are also supporting a local merchant that pays local taxes and rents, supports local charities and patronizes local businesses. Allied Brokers has been part of the Palo Alto community for over 50 years and although we won’t stuff you with mini quiche samples like at Costco, your agent will always be available when you need help.

Visit our website at http://www.alliedbrokers.com/ for information about all the types of insurance we offer. Or call 1-888-505-7988 for a free rate quote.

Friday, July 20, 2012

Allied Brokers Supports Prop. 33

Current California law allows a loyalty discount if a customer stays with the same insurance company over time. The insured, however, cannot take that discount with them if they want to switch to another auto insurer. Prop. 33, the 2012 Automobile Insurance Discount Act, will reward Californians for maintaining car insurance, and allow them to take their loyalty discount to competing insurance companies.

Allied Brokers supports Prop. 33 because we feel it will level the playing field for consumers. As it is now, our clients who want to get a better rate cannot take their renewal discount with them when they switch between the 10 insurance companies we represent. If the rules changed, our customers could save big money. Putting your customers first is good business.

Consumer Watchdog opposes Prop. 33 because they think it will result in rate hikes for consumers that don’t have prior insurance. This makes no sense because this is already happening to people without prior insurance. Under the current law, they pay 20% more than someone who has stayed with the same company over time. Prop. 33 would just allow people with insurance to move freely between companies to save money.

Most insurance companies oppose Prop. 33 because they like things the way they are. Their customers are trapped. If Prop. 33 passes, insurance companies will have to lower prices and run a leaner business to retain customers.

Mercury Insurance is one of the few carriers that supports Prop. 33. Mercury is the most efficiently managed auto insurer in the world and they have the lowest internal costs in the industry- which they are able to pass on to customers as savings.

Call Allied Brokers for personal, expert advice about the best choices for your unique insurance needs. Or visit our website at http://www.alliedbrokers.com/ for information about all the types of insurance we offer. Or call 1-888-505-7988 for a free rate quote.

Friday, July 6, 2012

Weird, Gross and Ridiculous Claims

Abby Normal’s brain melts down in lab mishap

In May this year a freezer malfunctioned at a Harvard-affiliated hospital that oversees the world’s largest collection of autistic brain samples, damaging a third of the scientifically precious specimens. The Harvard Brain Tissue Resource Center is the largest and oldest federally funded “brain bank’’ in the United States. It provides thousands of postmortem brain tissue samples annually to researchers across the nation.

Covered or not covered? The exact cause of the meltdown is still under investigation. If it turns out that there was a “malfunction” of the refrigeration unit, this type of loss could be covered under an Equipment Breakdown Policy. The big question, of course, is the damage to the contents in the refrigerator. The EB policy does pay for resultant damage to the property but the problem is placing monetary value on the “spoiled” brains AND the business income resulting from the loss of the brains in the research process. This claim will probably fall through the cracks but maybe it will inspire Mel Brooks to produce another Young Frankenstein movie.

Hall of Shame award goes to NJ woman who sues 11 year old Little League player

A New Jersey woman who was struck in the face with a baseball at a Little League game is suing the young catcher who threw it. Elizabeth Lloyd is seeking more than $150,000 in damages to cover medical costs stemming from the incident at a Manchester Little League game two years ago. She’s also seeking an undefined amount for pain and suffering.

Lloyd was sitting at a picnic table near a fenced-in bullpen when she was hit with the ball. Catcher Matthew Migliaccio was 11 years old at the time and was warming up a pitcher. The lawsuit alleges Migliaccio’s errant throw was intentional and reckless, “assaulted and battered” Lloyd and caused “severe, painful and permanent” injuries.

An attorney representing the boy's family says the count alleging negligence and carelessness is covered by homeowner's insurance, but other counts are not.

A second count alleges Migliaccio’s actions were negligent and careless through “engaging in inappropriate physical and/or sporting activity” near Lloyd. She continues to suffer pain and anguish, incur medical expenses and has been unable to carry out her usual duties and activities, the lawsuit says. And Lloyd’s husband, in a third count, is suing for the loss of “services, society and consortium” of his wife.

Covered or not covered? The count alleging negligence and carelessness is covered by homeowner’s insurance but the other counts are not. Little League has denied any coverage. A spokesman for Little League said each local league is required to have accident insurance, but that only covers coaches, players, and concession stand workers but not cover spectators.

Matthew’s parents said they would love to beat the charges in court, but it could cost tens of thousands of dollars and they also don’t want to put their son and other kids on the team through all the questions and depositions a trial would bring.

The real Hall of Shame winner is the Lloyd’s ambulance- chasing lawyer.

Sunday, June 24, 2012

Key Figures in Organized Auto Insurance Fraud Ring Nabbed

Teddy Marks, 41, of Morgan Hill, CA, who the California Department of Insurance (CDI) is calling a “key figure” in an organized auto insurance fraud ring, has been arrested on two felony counts of insurance fraud and one felony count of grand theft, according to CDI.

Bail has been set at $1 million. If convicted, Marks could face up to five years in prison and $50,000 in fines for each insurance fraud count, and up to three years in prison and a $10,000 fine for the grand theft count.

A second suspect is outstanding and believed to be in New Jersey. Louis Miller, also known as “Skippy,” also has a $1 million arrest warrant issued by the Santa Clara County District Attorney.

“Marks and Miller are believed to be the patriarchs of a criminal family that specializes in auto insurance fraud,” CDI said in a press release.

An investigation revealed that Marks, in collusion Miller, conducted a staged auto-versus-pedestrian collision in the parking lot of Artichoke Joe’s Casino in San Bruno, according to CDI.

During the claims process Marks and Miller denied knowing each other, and after the collision, Marks, the driver, and Miller, the pedestrian, proceeded to defraud the insurance carrier and three different hospitals in excess of $200,000, according to CDI.

“Insurance fraud directly affects each of us-the costs to the insurance companies are passed along to consumers through higher insurance premiums,” Deputy District Attorney Charlotte Chang, who prosecuted these cases, said in a statement.

Visit our website at http://www.alliedbrokers.com/ for information about all the types of insurance we offer. Or call 1-888-505-7988 for a free rate quote.

Friday, June 22, 2012

Blue Shield Accused of Culling the Herd

Last week in San Francisco a consumer advocacy group called Consumer Watchdog filed a lawsuit against Blue Shield of California. They accuse Blue Shield of a pattern in which it stops selling a policy and then raises rates for those who are left in the plan. Those who stay tend to have more health problems because they don't have many other options for coverage.

The lawsuit argues Blue Shield is violating a 1993 state law that requires health insurers that intend to stop selling a type of policy to "pool" the health history of the members in the closed block of business with other enrollees to minimize rate increases for those left in the old policy.

The 1993 law also requires insurers to offer members the option to switch to a comparable policy that is accepting new members. But the consumer group's attorney, Jerry Flanagan, said offering members another policy with a deductible more than twice as high as the old policy and fewer benefits isn't "comparable."

"You can't close out older policies for the purposes of kicking out sick people," Flanagan said. "You buy insurance when you're healthy, you pay into it, and eventually people are going to get sick and are going to use their health insurance. That's how it works." He claims Blue Shield is trying to force policyholders out of older, more comprehensive individual plans into newer options that offer less coverage with higher out-of-pocket costs.

Blue Shield officials denied wrongdoing.

When this happens to your pool, call Allied Brokers. There are things you can do to avoid paying the increased rates. Blue Shield establishes lower rates within the same pool for those who are in better health. This is called “tier rating” and it is normally in five different levels.

If you are in good health, you can apply for one of the new plans that have lower rates. Or you can apply for a change to a lower tier premium rate for your present plan.

Another option is to change your deductible and/or drop some of the coverage. One Allied Brokers client saved $4,800 per year by dropping some coverage and raising his deductible from $750 to $2,000.

If you are in poor health, you can apply for a change to a lower tier rate level premium as your health improves. If you do not re-apply to prove you are healthy enough to change tiers, you are stuck. Most people do not know they can transfer to get a better deal. Call us- this service is free.

Visit our website at http://www.alliedbrokers.com/ for information about all the types of insurance we offer. Or call 1-888-505-7988 for a free rate quote.

The original article, by Victoria Colliver, can be found on SFGate.com

Friday, June 15, 2012

The Lean New Reality Tarnishes Golden Years

The bad news: Many baby boomers are likely to get less money from Mom and Dad than they thought. The worse news: They may have to help their parents financially instead.

For years now, boomers have expected getting tremendous windfalls as their parents pass on. Many boomers, in fact, have been lagging in their savings and betting on big bequests, especially since many of them suffered big losses in 2008.

But for a growing number of boomers, things aren't going according to plan. The postwar generation is living longer and many are spending their savings along the way.

How much longer? Thanks to medical gains, a 65-year-old man has a 60% chance of living to age 80 and a 40% chance of reaching 85. For women, the odds are 71% and 53%, respectively. All of this has made the 85-and-over age bracket the fastest-growing segment of the population.

The result is that, as a group, boomers likely won't be getting as much of an inheritance as they hoped. Even worse, far from receiving a bequest, a growing number are tapping into their own savings to help their cash-strapped parents make ends meet.

For families, the result is often a lot of scrambling, dashed dreams, conflict and anger as parents and children try to come to grips with the lean new reality-and divide up a smaller pie.

Not surprisingly, many families are loath to discuss these issues. In addition to serving as a reminder of the older generation's mortality, a conversation about inheritance or Mom and Dad running out of money can provoke anxiety in parents. Many are uncomfortable disclosing the details of their finances in the first place, even more so when they're worried about disappointing their children.

Adult children, in turn, aren't eager to ask their parents about money for fear of coming across as greedy. Some feel guilty for thinking about their own financial needs at a time when parents could be facing steep medical or long-term-care expenses.

Nonetheless, financial advisers say, it is important for families to talk-if only to establish realistic expectations.

If parents anticipate running short of money-and if they and adult children are able to start a dialogue-there are several measures families can take. Among them: Have parents recalibrate their budgets, downsize to a smaller residence, buy an annuity or longevity insurance to lock in a lifelong income, or take out a reverse mortgage.

In situations where children have adequate financial resources, they can pay a parent's health-insurance premiums, purchase a long-term-care insurance policy for him or her, give a set amount of money each month or purchase the parent's home to generate cash for living expenses.

Before implementing any strategy however, talk with your financial and tax advisers.

If you are interested in learning more about long term care, disability, life, home and umbrella insurance, call Connie Prince at Allied Brokers. Connie is our in-house expert with 26 years of industry experience and strong relationships with major carriers such as Mercury, Travelers, CIG, Hartford AARP, Glenworth, Prudential and Banner.

Visit our website at http://www.alliedbrokers.com/ for information about all the types of insurance we offer. Or call 1-888-505-7988 for a free rate quote.

A version of this article appeared in the June 11, 2012 edition of The Wall Street Journal, with the headline: Counting on an Inheritance? Count Again...

Monday, June 4, 2012

Car Rental Insurance

I recently received this inquiry regarding rental car insurance and foreign travel:

“Hello, I am from New Zealand and my girlfriend and I are planning on travelling across country (US) in a hire car for around 40 days. I have travel insurance but that only covers me for excess on insurance of up to $5000. Basically, I want to know if you can offer either a daily rate or a fixed period rate for this trip. I will need liability insurance/3rd party (coverage up to US $1,000,000) and coverage for damages to the car. Obviously, my excess can be up to $5000. Also, we will be covering many states. I look forward to your reply. “ - Regards, S M.

S.M., “We do not provide short term policies but you can buy coverage through the rental car agency you use, but they may not have the high limits you desire. Check with your New Zealand policy to see if they will endorse it. International companies that do this, that I know of, are USAA, Fireman’s Fund (owned by the Swiss firm Allianz), AIG (called Empcompass] and Chubb- they offer international car rental insurance to their current policy holders. I do not know if they do business in your country. “ - Chris Grammar

If you want to buy USA insurance, go to http://www.car.progressive.com/ Progressive Online will insure a foreign licensed driver driving a rental a car in the United States. Also the credit card you use to rent the car may provide additional coverage to cover the cost of your deductible. AMEX, Visa and MasterCard usually provide some coverage for damage to the rental car. For answers to all your insurance questions, call 1-888-505-7988 for a free rate quote or visit our website at http://www.alliedbrokers.com/.