2015 | Boizelle Insurance Partnership
When Should You Buy Insurance For Business?
Sometimes businesses just happen. You’re providing care, making clothing alterations or offering writing advice to friends, families and neighbors—just because it’s what you do. Then, one day, someone recommends you and someone you don’t know asks, “How much for your service?” Are you ready to charge? How much will you have to pay taxes? And when should you buy insurance for business?
These questions, when they come up, are both exciting and daunting. But whether you’re an accidental entrepreneur or one who’s driving a startup with a business plan in mind, insurance should be top of mind. It’s a financial tool that can help you protect your investment and manage your liability.
Here are five types of insurance to consider:
Property and General Liability – Property insurance helps protect the business’s property, such as computers, equipment and building. It can also protect your income against unexpected loss due to fire (for example). Liability insurance protects business owners from claims of injury or property damage incurred by others as a result of your operations.
Auto Coverage – Just like you insure your personal vehicle, you may need coverage on vehicles you use for business.
Business Catastrophe Liability – These polices extend the amount of coverage on your general liability, commercial auto liability, professional liability and employers liability policies so you’ll have more protection in case of a catastrophic situation where you’re held liable. (AKA, someone decides to sue you.)
Employment Practices Liability – This is an endorsement you can add to your property and general liability insurance to protect you specifically in case an employee sues you for sexual harassment, discrimination or other common employment issues.
Workers’ Compensation Coverage – This insurance provides coverage for injury or disease sustained by your employee arising in the course and the scope of their employment, regardless of negligence on your part and may be required to comply with your state’s workers’ compensation law.
When insurance isn’t required by law, it’s up to you to decide how much coverage you need and for what assets. But navigating the choices can be difficult. The 2013 U.S. Small Business Commercial Insurance Study from J.D. Power and Associates reports that face-to-face consultation positively impacts a small business’s experience when it comes to insurance.
If you’re an accidental entrepreneur or a startup looking for help, contact Boizelle Insurance Partnership at 800-783-2421.
By: Catherine Amick, Erie Insurance
Read more6 Scary Insurance Misconceptions
There are lots of spooky things about Halloween. Just a few include ghosts, goblins and the unfathomable: running out of Halloween candy.
Not many people add insurance to this list, despite the fact that a coverage gap could leave you and your family in serious financial trouble.
Read on to learn about six of the scariest insurance misconceptions and how you can protect yourself.
Six Scary Insurance Misconceptions
- Your home insurance policy automatically includes flood and earthquake insurance.
Insurance companies can’t cover floods and earthquakes at reasonable rates since they tend to be so devastating. Fortunately, there are options for both risks. Earthquake coverage is typically offered as an endorsement while the federal government offers flood coverage through the National Flood Insurance Program (NFIP). It’s definitely worth considering since people who live outside of high-risk flood areas file more than 20 percent of NFIP claims. What’s more, just one inch of water can cause major damage to your home.
- Your homeowners and personal auto policies will cover you if you use them to operate a small side business.
Your homeowners and personal auto policies may not adequately cover your business activities. If you operate a home-based business or another small business, explain your situation to your insurance agent. He or she can advise you about any additional coverage you may need.
- Your homeowners policy will automatically replace your lost or damaged items in today’s dollars.
There is a big difference between actual cash value (ACV) and replacement cost. ACV reimburses you based on how much an item is worth after factoring in depreciation. Guaranteed replacement cost is much better: with it, your policy pays the cost of rebuilding or repairing your home or replacing your possessions without a deduction for depreciation.
- Only millionaires need a personal catastrophe liability (PCL) policy.
Anyone can be involved in a serious accident. Most of the time, incidents are caused by simple negligence like forgetting to lock the fence surrounding your pool before a child finds his way to it.
Accidents of this nature have the potential to cause financial catastrophe to people of any financial means. Without proper coverage, you could also lack the resources to compensate someone for their injury and hardship.
- I’m not responsible if my friend wrecks my car.
If your car is involved in an accident, it’s your responsibility since you granted permission for someone to use your car. So your insurance will cover the damage, and the accident will go on your insurance record. This could result in a higher premium. The lesson? Limit how much you loan your car—and only choose trustworthy drivers.
- You only need life insurance if you have kids.
Parents—both those who are employed and stay-at-home—aren’t the only ones with a need for life insurance.
Does anyone else (like a parent) depend on your income? Then life insurance is probably a good option for you. Do you own a home with someone else? If so, could the surviving partner carry the full load of the mortgage? Or maybe you simply want to leave money to your favorite charity or relative. It’s also wise for business partners to take out life insurance on each other so they could afford to purchase a deceased partner’s outstanding shares.
There’s no need to fear a potential coverage gap. Simply give Boizelle Insurance Partnership a call. We can tell you about affordable options that give you the protection you need. Don’t worry–we won’t try to sell you ghost insurance (a real insurance coverage).
By: Amanda Prischak, Erie Insurance
Read moreWhose Insurance Pays When Your Friend Crashes Your Car?
Auto insurance typically follows the car rather than the driver. This means that your insurance will likely pay if your friend crashes your car.
There are two exceptions. The first is when the damage and/or injuries exceed the available limits on your policy. In this instance, it’s possible that your friend’s insurance would kick in to cover the outstanding balance.
Another exception can occur when someone drives your car without your permission. “This can get confusing,” says Dave Freeman, Vice President, Personal Lines Underwriting at Erie Insurance. “For example, imagine a college roommate grabs the keys and borrows another roommate’s car. Some courts say permission was implied; others say express permission was necessary. It really varies by jurisdiction.”
Will the Accident Go on My Record or His?
When you let someone else drive your car, you are taking responsibility for their behavior. So the accident becomes part of your insurance history.
It’s also possible that your rate may go up. Your insurer bases the rate on your likelihood of filing a claim; when you loan your car to someone who may not be as careful or have as much experience driving as you, your rate needs to reflect that.
If you’re with ERIE, you can help avoid a rate increase with the ERIE Rate Lock® feature.* (Not available in New York or North Carolina. Limited to three years in Virginia.) Even if you have a claim, your rate won’t change unless you add or remove a vehicle from your policy; add or remove a driver from your policy; or change your primary residence. Boizelle Insurance Partnership can tell you more about ERIE Rate Lock®.
The accident may also show up on your friend’s driving record. This is especially likely if a police report gets filed after your friend crashes your car.
The Lesson
Freeman advises drivers to be selective when loaning their cars. He also says it’s important to let your insurance agent know if someone else regularly drives your car. “If someone is a regular operator of your vehicle, you should add him or her as a driver on the policy,” says Freeman. “If you intentionally fail to disclose the person as a driver, the claim could potentially be denied if that person has an accident.” (The only exception is a spouse who lives in the same household— he or she is automatically a “named insured” on the policy.)
To learn more about auto insurance and ERIE Rate Lock®, contact Boizelle Insurance Partnership at (301) 948-2010.
*ERIE Rate Lock® does not guarantee continued insurance coverage. Insured must meet applicable underwriting guidelines. Premium may change if you change policy coverages, deductibles or pay plan. Patent Pending.
By: Amanda Prischak, Erie Insurance
Read more8 Homeowners Insurance Coverages You Need
When it comes to homeowners insurance, not all policies are created equal. And that’s important to remember when it comes to protecting what could very well be your biggest asset.
Check out the list below to see what you need in homeowners insurance.
The right limit: You need enough insurance to let you rebuild if you have a total loss. So don’t risk it by choosing a lower limit in an effort to save a few dollars.
One thing to remember when it comes to the right limit is the increased value your home may have after a home improvement project. Always report any home improvement project ASAP to your insurer so they can adjust the limit if necessary.
Guaranteed replacement cost: When you have guaranteed replacement cost, you can rest easy knowing that you could rebuild your home after a major loss without worrying about depreciation, policy limits or insurance construction costs once you’ve repaired or replaced the damaged property. This is definitely a better option than actual cash value, which takes depreciation into account when calculating the amount of your reimbursement.
Enough liability coverage: Your homeowners liability coverage protects your assets in the event someone gets hurt on your property. It also offers coverage for some incidents that happen away from your home (for instance, if you run your bike into someone).
Lawsuits aren’t as uncommon as you might think, and they have the potential to wipe out many people’s net worth. That’s why most people will want to have at least $300,000 of liability coverage. You might also consider a Personal Catastrophe Liability policy, which adds an extra $1 to $5 million of coverage to your homeowners as well as your auto insurance.
Loss of use: If your home was a total loss or became uninhabitable after a covered loss, do you know where you would stay and how you would pay for the extra expense? Loss of use coverage offers you reimbursement for costs to stay at a hotel or rent an apartment in the event of a covered loss.
Endorsements that let you customize your coverage: Everyone’s risk factors are different. That’s why you’ll want the option of adding earthquake coverage along with inland marine coverage for high-value items you may own. Another important coverage that many homeowners need is flood coverage, which is offered as a separate policy by most carriers.
Two other endorsements that many homeowners find beneficial are Identity Recovery coverage and Sewer & Drain Backup coverage.
A reliable deductible: Many homeowners recovering from a disaster such as a hurricane get sticker shock when they learn their deductible isn’t a dollar amount that they chose, but rather a percentage of the limit on their policy. These named-storm percentage deductibles are almost always higher than dollar-amount deductibles—and sometimes significantly so.
Unlike many carriers, ERIE’s named-storm deductible is a specific dollar amount rather than a percentage of your homeowners limit. What’s more, you also have the option of choosing different dollar-amount deductibles for different causes of loss.
The backing of a financially sound company: If you have a claim, you want the backing of a company that can pay it. One way to find out if your company is financially sound is to check the rankings from Ward and A.M. Best that are released each year. In addition to earning an A+ rating from A.M. Best and ranking among Ward’s Top 50 performing property/casualty insurers, ERIE also earned kudos for being among America’s 50 most trustworthy financial institutions.
A knowledgeable local insurance agent: It’s no secret insurance that can be complicated. To simplify things and get trusted advice, it’s a good idea to work with an insurance agent you trust. Boizelle Insurance Partnership is an insurance expert you can count on to help you get the right coverage at the right price. Call us today at (301) 948-2010 to review your homeowners insurance and ensure you are protected.
By: Amanda Prischak, Erie Insurance
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