Friday, February 23, 2018

Insurance Basics for the Newly Married

Typically, an unmarried person has only minimal insurance coverage; even that is often limited to what is mandatory, such as auto insurance for purposes of legal driving. The whole picture changes once you get married. You need to be responsible for another person. There is a spouse now and a family that will grow and hence you should reconsider your insurance cover.

Even if both spouses are working, the loss of a car, a home or one income could be catastrophic. Of course, with two people involved, the risk of sickness or injury becomes much greater, no matter how healthy you are. For all these reasons and more, it becomes critical to consider the right insurance coverage in order to protect your future with your partner.

The four main areas of insurance that you should act on as soon as you get married are the following.

1 Life Insurance

You didn’t need life insurance when you were single, with no dependents to support. Now, post marriage, should you die, your spouse could be in serious financial difficulties, if your life insurance is not enough. For example, the sudden loss of income could cause a financial disaster because:

                v  both incomes are needed to pay bills.
                v  one income is not enough to cover the mortgage payments 

                v  debts and liabilities are there to be dealt with.

Life insurance will provide crucial financial security for the surviving spouse.

2 Health Insurance

Generally, there is a fixed period each year, when you can buy or change health insurance. It’s called ’open enrollment’. However, when you get married you are usually entitled to buy health insurance even if it is not ’open enrollment’ time.

The rule is that you should have 60 days to enter into a new individual health plan, or 30 days during which you can become part of your spouse’s employer-based health insurance plan. Examine how satisfied you are with the policies you both have and the costs involved.

If you find that both are satisfactory, you could continue with separate health plans. However, in many cases, both spouses being on the same policy may be more economical and helpful in reaching sooner your annual deductible.

3 Homeowners and Renters Insurance

Presume that your spouse and you both had individual renters or home insurance coverage before you got married. Now that you are married and going to live together, one of the two policies can be canceled. The retained policy will cover both spouses but the insurance company must be kept informed so that the spouse’s name can be added to the policy.

4 Auto Insurance

In a similar way, compare the individual car insurance policies you both had before marriage to find which one offers the best rates. Also, check out other insurance companies for better options available for the two of you.

Any new policy must be effective from the day an old policy ends. If this is not done, future insurance costs could be higher. Look for discounts that may be available with a multicar policy or a bundled car and homeowners policy.

Life after marriage is very different from that before. It is essential to understand the nuances of the insurance needs of a single person and those of a couple. It is even more essential to plan and cover your obligations and liabilities.

Do seek the guidance, at the earliest, of an experienced insurance professional; arrive at the right kind of protection you need at the right cost. 

Fire Risks and Home Insurance in California

According to reliable news sources, insurance companies are in the process of reclassifying high bush fire risk areas in California. The object of this exercise is to provide homeowners in the state with the information they need to understand and evaluate the risks they face from bush fires.

With this information, they will be able to make informed decisions on the actions they need to take to protect their property and belongings. While the results of reclassification may be good news for some homeowners, it may not be so for others.

Risk level of your home

Obviously, insurance companies are reluctant to issue policies in high-risk areas. If they agree to issue policies, the premiums will be rather high. Furthermore, policyholders in high-risk areas fear the prospect of cancellation of their insurance policies. This could happen of course, but no insurance company can afford to carry out unilaterally the cancellation en-mass of policies in these high-risk areas.

In order to cancel or refuse renewal of a policy, the company has to inspect first each home. The policyholder has to be provided with reasonable justification for its decision. The company must point out the problems that can increase the risk of damage or loss. In addition, policyholders will have to be given adequate time to take action to fix those problems.

Common causes for cancellation

The most common reasons for cancellation or non-renewal of insurance policies include the following.

      v  Old or poorly maintained roofs

v  Trees overhanging the roof

v  Less than 500 feet of defensible space and clearance from trees and brush

v  Poorly maintained yards

v  Plants like ivy growing on the side of the home

v  Homes that are vacant, under construction, being used for home stays by agencies like Airbnb, or rented when it is listed as owner-occupied

Your home insurability may suffer from any of the causes listed above or others. It will therefore be a good idea to take pre-emptive action to fix the issues before the insurance companies start raising them. An insurance company that is eager to offer a policy is much easier to deal with than the one that is reluctant to do so because of the inherent risks involved.

Insurance companies can refuse to renew the policy, in case the problems that increase the risks are pointed out, but not fixed by homeowners. Additionally, the companies can refuse to take on new customers in areas where they feel the risk is too high.

Knowing your real situation 

As a homeowner, you wouldn’t certainly like your insurance company’s intimation that your policy will be canceled or not renewed because of high bush fire risks. You would try your best to protect your home from those risks, and satisfy conditions that would facilitate sufficient insurance cover for your home.

It would be best to seek, at the earliest, a professional insurance agent’s expert guidance on where you stand and what you are required to do to ensure that your home stays properly insured.