Multifamily Insurance Trips and Traps

Surely every property owner’s nightmares must include finding out in the aftermath of a hurricane, fire or a lawsuit that insurance does not cover the costs. What a disaster! Apartment owners must be very careful to risk-manage properly and make sure their assets have the correct insurance policies.

Experts’ advice for ensuring proper insurance protection for apartment properties typically fall into three categories: Making sure that the right type of insurance is purchased, ensuring that enough coverage is purchased and selecting the right insurance broker.

Simply opting for the policy with the lowest premium “just because they are trying to save money” is one of the most common pitfalls of apartment owners, says Carlton Einsel, executive vice president of The Donaldson Group, a third-party apartment manager. “But people do that,” he adds.

According to attorney Barry Fleishman, partner at Kilpatrick Townsend & Stockton LLP, the most typical missteps apartment companies can make include not adequately understanding the coverage, not reviewing the actual policy terms with their brokers and legal counsel, and failing to compare losses in the past to their current coverage. Insurance is a very difficult and complex field, says Fleishman, and the risk manager or CFO should work closely with the broker and/or an insurance attorney to make sure there are no unintended gaps in the protection.

What type of insurance to purchase

First, apartment owners need to ensure the correct type of insurance is acquired. Experts advise that owners purchase all-risk—rather than named-peril—insurance, whether the insurance is third-party property insurance or general liability insurance. This is because named-peril insurance covers only risks that are specifically named, whereas all-risk insurance covers all risks except those explicitly excluded. Property owners should also be careful to have policies that reimburse at replacement cost—and that cover business interruption.

“Buy broad, all-risk, policies, rather than named-peril policies,” says Steve Cataldo, director of risk management at Greystar, which oversees insurance for a management portfolio of more than 48,000 apartment units.

Property insurance coverage generally applies to “all risks,” such as  fire, explosions, earthquakes, tornados and hurricanes, with the exception of specific exclusions. Fleishman, a legal specialist in policyholder insurance coverage, says it’s important that the apartment company review the risk history of the property and the areas in which losses were suffered in the past, and then ensure that none of these exposures are excluded from coverage.

The terms of the insurance, naturally, will be influenced by the location of the property. If the apartment asset is close to a disaster prone area, such as a flood or an earthquake zone, the insurance policy will likely contain sublimits that may be much lower than the coverage for the basic perils.

Certain perils such as windstorms and earthquakes may also carry higher deductibles, depending on the location of the asset, adds Derek Ramsey, Greystar CFO. The apartment owner needs to determine its ability to fund the deductible if a loss occurs. If available cash will be insufficient to meet that deductible, then the owner may want to consider paying a higher premium in order to obtain a lower deductible, he points out.

If coverage for particular risks-—such as flood, pollution or earthquakes in certain regions—is not found in traditional types of policies, the property owner may be able to look to alternative instruments for managing risks. These alternative instruments, which can be very sophisticated, include specialty risk policies (such as pollution liability policies), catastrophe bonds, self-insurance supported by re-insurance, or industry risk retention pools, says Fleishman.

As regards both liability and property insurance, Fleishman advises that apartment owners ensure that all layers of insurance—primary, umbrella and excess—be consistent with each other. For example, property owners should make sure that certain excluded losses in primary layers are not also excluded in umbrella or excess layers. In such cases, there would be a gap in coverage.

“Sit with your broker (or attorney) and go through the policy page by page(it takes one day or so), and understand what is in the policy: what is covered and what is excluded,” he says. “The broker should make sure the policy is consistent in each layer of insurance or tell the client where it is not.”


Source

Restaurant Insurance Basics

One area in the restaurant business you do not want to skimp is insurance. Insurance can protect you and your business for a myriad of problems, from broken equipment to liability lawsuits. Depending on where you live, you will need certain types of insurance for your restaurant. You will also need to carry certain types of insurance to satisfy your bank loans and mortgage.
The most common types of restaurant insurance available include:
• Property Insurance- – Protects your property in case of fire or other events. It may not cover natural disasters, such as floods or earthquakes (see below for a policy that does.) If you have any kind of mortgage on your business and/or equipment, then you should carry a property insurance policy.
• General Liability – This is the umbrella policy that protects you in the event someone slips and falls in your restaurant, gets sick after eating there (whether it was your fault or not). This is a must have in today’s sometime sue-happy world.
• Liquor Liability – Most states require that any establishment holding a liquor license carry liquor liability as part of their insurance. It helps protect you if a customer has too much to drink and drives and hurts themselves or someone else.
• Automobile Liability – If you have a company vehicle, this is a good insurance to have. It may be covered in your general liability, but always check with your insurance agent first.
• Workers Compensation – Protects you if an employee is hurt at work. Most states require that all employers carry some type of workers comp.
•Unemployment Insurance– Is for your employees who no longer work for you until they find employment.
• Life Insurance – Depending on your mortgage and financing you may need to carry a hefty life insurance policy to satisfy your lender. It is also a good idea to have life insurance, in case something does happen to you and your family isn’t left with a restaurant they don’t know how to run and bills they can’t pay.
There is insurance for just about any object, action or person out there. Here are some other types of insurance you can purchase for your restaurant.

• Loss of Business Insurance – If you lose sales through a specific cause, this type of policy can recoup some of the income. Keep in mind the premiums and deductible may make you break even, depending on how much you lose.
• Food Contamination Insurance - If you lose power, because of fallen power lines or a storm, and the entire contents of your walk-in and freezer spoil, this policy would pay to replace the food.
• Specific Peril InsuranceThis covers many natural disasters that general liability insurance doesn’t. Events like earthquakes, floods or power outages due to either, may be covered under this insurance.

Use a trusted insurance agentwhen buying insurance when you are opening a new restaurant. They will know the local and state laws pertaining to how much insurance you need and can help you decide how much more you want to carry.

Source

Does Homeowners Insurance Cover Theft Outside the Home?

Many losses of personal property due to theft outside your home may be covered by off-premises coverage. This type of coverage is included standard in many policies, however off-premises policies may not be available in all areas, particularly areas with high crime rates.  But many insurers will add an off-premises rider to your coverage for a small extra charge if it’s not included in your policy.

Your off-premises coverage isn’t a panacea for all your losses to theft, however. Your policy won’t cover the loss of an automobile--although your auto policy might--or CDs, stereos or MP3 players stolen from a car. Your homeowner’s policy usually won’t cover the loss of a boat, an outboard motor or other items from a boat that isn’t parked at your home, either. The claims limit of some high-ticket items, such as jewelry, electronics or collectibles, may be much lower than the item’s actual value.

If your children are college students, your homeowner’s policy may even extend to losses from theft they suffer. Many policies’ off-premises coverage extends to the homeowner’s children who are students if they live in the dorm, so property stolen from a dorm room or when they’re studying -- such as a laptop stolen while they were at the library -- may be covered. When your child moves out of campus housing and into her own apartment or house, she’ll probably need to carry her own renter’s policy to cover thefts.

Source: http://homeguides.sfgate.com/homeowners-insurance-cover-theft-outside-home-53333.html

Main Line Insurance Office has been providing service to our customers since opening our doors in 1974. We are licensed in and serve businesses and individuals in PA, DE, NJ, MD, VA, and FL. Our staff will help you analyze your insurance coverage issues to develop insurance policies for your specific requirements.

The 10 Most Stolen Vehicles

The National Insurance Crime Bureau (NICB) recently released its annual list of the most frequently stolen cars in the U.S., and the 1994 Honda Accord topped the list for the fourth year in a row.

Though late-model sports and luxury cars tend to be swiped intact and sold with swapped identification numbers and laundered titles or sent to other countries, more-common models (like the Honda Accord, Honda Civic, and Toyota Camry – especially older examples that lack newer key-code anti-theft technology) are usually driven or towed away and immediately dismantled at so-called “chop shops.” While the recoverable value of any of these dated models tends to be comparatively minimal, they’re worth far more as an amalgam of salvaged used parts sold by unscrupulous vendors.

The NICB reviewed vehicle theft data submitted by law enforcement to the National Crime Information Center during 2011 to produce the following list of the 10 most-stolen vehicles during 2011:

1. 1994 Honda Accord midsize
2. 1998 Honda Civic compact
3. 2006 Ford F-150 pickup
4. 1991 Toyota Camry midsize
5. 2000 Dodge Caravan minvian
6. 1994 Acura Integra compact
7. 1999 Chevrolet Silverado pickup
8. 2004 Dodge Ram pickup
9. 2002 Ford Explorer SUV
10. 1994 Nissan Sentra compact

Source: http://www.forbes.com/sites/jimgorzelany/2012/08/20/the-10-most-stolen-vehicles/

Main Line Insurance, located in Paoli, Pennsylvania, serves businesses and individuals in PA, DE, NJ, MD, VA, and FL. Our staff will help you analyze your insurance coverage issues to develop insurance policies for your specific requirements.

Liquor Liability Insurance

Liquor Liability is an essential type of restaurant insurance for establishments that sell alcoholic beverages. Selling alcoholic beverages carries with it a risk of irresponsible behavior by intoxicated patrons. Property damage, personal injury, or service of alcohol to underage customers could result in lawsuits being brought against a restaurant, club, or bar who serves alcohol.

In the eyes of liquor liability and restaurant insurance providers, some business types and business practices are more risky than others. Factors such as the average age of the patrons, type of entertainment provided, drink promotions, and age verification procedures can have a great effect on the level of liquor liability the business requires.

Source: http://theliquorlicenseadvisor.com/blog/?cat=9

Main Line Insurance, located in Paoli, Pennsylvania, has over 35 years of experience providing restaurant insurance to food and drink establishments ranging from the corner deli to the large fine dining five star eatery.

What Can You Do If Your Sandy Insurance Claim Is Denied?

November 13, 2012
By Michael L. Diamond, Asbury Park Press, N.J.
The townhouse at 2 Vista Shores Drive in Union Beach lies in a crumpled heap with a lifetime of Susanne Bannon's belongings -- photos from a childhood in Ireland, Waterford crystal from her wedding, the bed she slept in last month -- now in one pile.
What is less clear is what caused the structure overlooking the Raritan Bay to topple over the night superstorm Sandy struck. Was it the wind, or was it the flood?
It's a distinction that for many homeowners at the Shore is at the heart of whether they can recoup their losses. Most every household has a homeowner's policy that covers damage by wind, rain and fire. Fewer have policies that cover flood damage.
It has sent Bannon, at least, scrambling to figure out her options after her homeowner's insurance claim was denied. And it has set the stage for a fight between homeowners and insurance companies that, if Hurricane Katrina is a sign, could wind up in court for many years.
"Most of the time (with Katrina), most of the problems were which (natural disaster) came first," said Mark Mese, an attorney who specializes in insurance for Kean Miller, a law firm in Baton Rouge, La. "It looks like there's going to be the same problem with Sandy."
Bannon was told by her insurance company, Allstate, that her home was brought down by the flood. It could cost her more than $100,000 -- the difference between what Allstate pays for her contents and what her flood policy pays through the federal National Flood Insurance Program.
Bannon, now in her late 60s, moved to Union Beach in 1999, downsizing from her home in Hazlet a few years after her husband died and her two children went out on their own.
She found an end unit in a townhouse complex, which, on clear days, came with a picturesque view of the bay and Manhattan.
With Sandy approaching, Bannon heeded evacuation orders and stayed at the Keyport home of her daughter, Maureen. The next day, she returned to Union Beach. By habit, she walked into the end unit. It belonged to someone else. Her home was nothing more than debris.
"It was devastation in Union Beach," Bannon said, standing outside what was left of her home. "I walked by this and said, 'Thank God this is a pile of rubble.' I walked in this door and said, 'This doesn't look like my unit.' "
Are you selling the #1 Critical Illness Product?
Maureen Bannon said Allstate had claims adjusters on the scene quickly, and they were nothing but sympathetic, leading the Bannons to believe that Susanne's homeowner's policy would cover the damage. But four days later they got a call; Allstate said the damage was caused by flood and was closing the claim.
It left Susanne Bannon to turn to her flood policy, where she quickly found the problem. Her homeowner's policy reimburses her up to $146,000 for contents. Her flood insurance policy reimburses her up to $12,800 for the same, she said.
Tracy Owens, a spokesman for Allstate, said he couldn't discuss individual homeowners' policies. But he said tidal waters can cause floods, which would not be covered by homeowners' policies.
The issue of what caused the damage first -- wind, fire or flood -- is one that homeowners and insurers fight over after virtually every hurricane. And Sandy with its 80 mph sustained winds and huge tidal surges offers more complications than normal, said Leslie Knox, a public insurance adjuster with Andrew K. Knox and Co. in Toms River.
Some damaged properties are easier to assess than others. Property insurers can point to a discolored line on the wall as evidence of where flood waters reached and conclude they won't pay for damage, say, on the first floor, Knox said.
If the building isn't standing?
"It makes it pretty hard to develop an argument when the building has been demolished," Knox said.
Homeowners who find themselves in disputes have some options:

• They can hire a public insurance adjuster who can assist the property owner in preparation, presentation and adjustment of Sandy-related losses. While insurance claims adjusters work on behalf of the insurance company, public insurance adjusters work on behalf of consumers. The two sides may be able to meet and iron out differences.
• Policyholders who don't agree on the settlement amount can avoid litigation and demand an appraisal. Both sides hire appraisers. They meet to discuss differences. And if they can't agree, it is sent to an umpire to decide.
• New Jersey policyholders whose claims are denied can appeal to their insurer's ombudsman who would review the decision.
• Policyholders can hire an attorney and take the case to court -- a move that wasn't uncommon after Hurricane Katrina hit the Gulf Coast.

The Bannons have hired an attorney and now are looking for clues to piece together an expensive question: What caused 2 Vista Shores Drive to collapse?
Learn more about our wide range of solutions
All around the borough are crumpled homes gutted by floods. But here, every other townhouse is standing. The attic is on the bottom of the pile. And all of the contents -- the oven, the exercise ball, the kitchen table -- aren't washed away, but lie in one neat heap.
At stake is whether Susanne Bannon rebuilds here, or begins to search for a new place to live.
"This is the only logical spot for her to be happy, content," Maureen Bannon said. "It fits her."

Source

Vehicle History May Become Another Insurance Rating Factor

November 16, 2012
Calumet City, Illinois (PRWEB) November 16, 2012
Auto liability insurance rates are generally expressed as a function of applicant's credit score, ZIP code, age, gender, marital status, driving history, besides certain surcharges and discounts. Physical damage car insurance rates are based, generally speaking, on the value of the insured vehicle. While most standard carriers have been using the CLUE reports in their underwriting, a couple of new patents have been filed by CARFAX to incorporate the vehicle history data in the auto insurance rating models.
Auto insurers have been using the C.L.U.E. reports and VIN reports for a while. CLUE auto reports offer a seven year history of automobile insurance losses associated with a person. The paid service is offered by LexisNexis. CLUE reports include the following data: date of auto loss, loss type, and amount paid along with general information such as policy number, claim number and name of insurer.
The U.S. Department of Justice in partnership with the American Association of Motor Vehicle Administrators (AAMVA) run a governmental body called the National Motor Vehicle Title Information System (NMVITS) to identify vehicle history pertaining damaged vehicles in order to prevent fraud. There are few other paid services in the private sector that compete with CARFAX in providing vehicle history data reports from the NMVITS. These include Auto Data Direct, Check That VIN, CVR, Experian, InstaVIN, and VIN Smart. Information included in the NMVITS includes current and previous state of title data, title issue date, latest odometer data, theft history data (if any), any brand assigned to a vehicle and date applied, as well as salvage history, including designations as a "total loss" (if any).
Ed Snenneh of Insurance Navy, a leading provider of auto insurance in Chicago said that the "new CARFAX patents are aiming at incorporating the vehicle history data, using quantitative models (scores), in the pricing models of auto insurance. Currently some carriers use the vehicle history information for reasons other than pricing. It is unsure how insurers will use the information. For example, if the data reveals lower value for a particular vehicle, will the insurer charge less physical damage premium to insure that particular vehicle because the amount at risk is lower?"
"The biggest issue we see is the cost vs benefit resulting from using the new models. Insurers will incur additional costs for ordering these reports. Will the increase in revenues from using these additional pricing factors justify the cost of obtaining the data for each vehicle to be insured? This question is yet to be answered by the insurers," Mr. Snenneh added.

Source