Saturday, March 23, 2019

Do You Have The Personal Liability Insurance You Need?

There is a widespread assumption that only those who are wealthy and have business interests need to worry about personal liability issues. The reality is very different. Society has become increasingly litigious, and you could suddenly be faced with a liability claim that could bankrupt you.

From a visitor’s suffering an injury in your home to serious but unintentional damages you could have caused – the areas of what a person may be held liable for keep expanding rapidly. Your homeowners insurance and auto insurance may provide you with some degree of liability protection; however, this must be clearly mentioned in the policy.

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The eligibility should not be taken for granted. It is advisable to contact an insurance professional to check on the amount of liability coverage you currently have.

A common mistake

A common mistake people often make is to presume that their current assets are not enough to warrant paying for liability insurance. The problem is that if a liability claim against you is upheld, you may lose part or all of your savings, investments, home, other property and so on.

Moreover, your future earnings may be garnished and assets may be impacted. Personal liability insurance protects you when you are at fault. Furthermore, your coverage will pay for your legal defense, in case you are falsely accused of an injury or loss.

How big is the risk?

The risk is greater than you may presume. It is an old truism that “most accidents occur at home.” To put that into perspective, the National Safety Council says that in 2013, one in sixteen persons suffered an injury at home that required specialist medical treatment.
If that one person happens to be a visitor in your home, you would be liable to pay for the accident.  Looking at it from a different angle, one in fifteen homes has an injury-related insurance claim each year.

Customer attitude is a major reason why the issue of personal liability coverage is ignored more often than not, or the coverage that may exist is too low to safeguard against a crisis. For instance, when buying a car or home, your focus is primarily on damage or loss; the liability aspect is rarely given the thought it deserves.

Liability could arise anytime from anywhere. For example, suppose that your child hits a ball in a game that flies through an open car window; the driver ducks the ball, loses control and suffers an accident; the liability could be massive, although it was inadvertently caused.

Protect what you have

A liability claim upheld against you could wreak havoc on your life. A reliable protection is in the form of personal liability insurance.  Liability is a complex legal matter and that is the reason why you hear about a very large number of court cases.

Personal liability insurance too is a complex matter. It is important to have the right amount of personal liability coverage; it is equally so to know what your coverage includes and excludes. The best person who can help you get the right coverage is an experienced insurance agent.

Saturday, March 9, 2019

Insurance Agents and Brokers: What makes them Different?

The terms ’insurance agent’ and ’insurance broker’ are often used interchangeably. To most people, they mean the same – people who sell insurance to customers.  It is generally true of course; however, there are a few important differences you need to be aware of. That information will help you decide on who to contact for your insurance needs. There are a few commonalities between the two:
  • Agents and brokers both require a license from the regulatory agency of the state in which they sell insurance.
  • Both receive their compensation from the companies whose insurance policies they sell.
  • They both need to acquire necessarily a few from many accreditations; a customer has the right to know which ones the agent needs to acquire, and which others the broker needs to. The customer has the right to be familiar with what those accreditations entail.

Insurance agents

An insurance agent is a representative of an insurance company: he works on behalf of that company to sell their insurance policies to customers. Agents are bound by contracts with the companies they work for. The contracts define what they can sell, say or do; they specify clearly the compensation an agent receives for policies sold.

There are two types of agents: a ‘captive agent’, who works for only one company, and an ’independent agent’, who works with multiple companies.  It may appear that independent agents are better off, but this is not always the case. Captive agents often have access to policies and terms reserved only for them. Independent agents, of course, have a wide range of policies they can offer from different insurance companies.

Insurance brokers

Insurance brokers do not represent insurance companies; they represent insurance buyers. They are not contractually bound to any insurance company, and so they are completely independent. They do receive compensation from insurance companies for the policies they sell, but their success and business growth come from the services they provide the buyers.

Which one is right for you?

Insurance is a highly competitive business. You do find many variations between all types of policies with reference to the terms, conditions and exclusions, and deductibles and premium amounts. A policy that costs more may not provide the type of coverage your specific circumstances demand. A policy that costs less than others may have the coverage you need, but the limits may be too low.

It is difficult for you decide whether higher deductibles and lower premiums are right for you, or the contrary is more suitable for your needs. An accurate comparison of policies, their benefits and their reliability requires a great deal of expertise and experience in matters of insurance.

Insurance brokers are in a better position to offer you a wider range of policy choices, and guide you to the options that suit your needs the most. Remember that insurance agents work for the benefit of insurance companies, and insurance brokers work for the benefit of insurance customers. The success of the brokers, both professionally and financially depends on the quality of their services to customers and customer satisfaction.