Builder’s Risk Insurance –What Is It & Who Needs It?

Builder’s Risk Insurance:

Insurance provides protection against most risks and no doubt that insurance is the most powerful weapon for a risk manager to indemnify the damages and losses. Builder’s risk insurance is such a specialized property insurance which covers a building or other type of structure while that is under construction. It is so crucial that many of the lenders don’t dare to finance a construction project without the presence of builder’s risk insurance. Generally this specialized insurance policy gives protection against the damages or losses resulting from acts of vandalism, fire or wind. If required or needed other types of risks such as terrorism, earthquake and flood may be added to the builder’s risk insurance policy.

As buildings are subject to a number of risks especially while they are under construction, builder’s risk insurance should be given the first priority to ensure the safety and investment guarantee. According to the common law the improvement to land or any new construction becomes the property of the owner of the land. But in the case of damages or losses due to the negligence of the contractor, the contractor will be responsible for that but for most other losses or damages the owner of the land will be responsible. So, the owner of the land is actually responsible to get the builder’s risk insurance but the contractor can also be added as a named insured to the policy.Under this specialized insurance policy the structure or building itself is insured against damages and any supplies or materials will also be covered by the policy while it is in action.

The builder’s risk insurance policy should be managed by a skilled and experienced insurance broker. At times the coverage level of policy may cross several million dollars. So, there is no alternative to assign an experienced insurance broker to get the policy prepared properly so that the owner of the property can get the appropriate level and type of protection from the policy. To do this the broker should be given the exact project details including the value of the completed building, labor and material costs of the building and other necessary information.

Who Needs Builder’s Risk Insurance:

Though the builder’s risk insurance is usually bought by the owner of the building, other persons or parties such as the contractor, sub-contractor, home builders, real estate developers and others with a financial interest in that construction project can buy this policy. Some financial lending corporations or trade associations may also have financial interest in million dollars projects and they may also require such builder’s risk insurance policy. This policy may be needed to comply with the local state, country or city building codes.

But whoever buys this policy the person or party has to provide accurate and reasonable information to the broker to maximize the safety coverage. Some phases of the construction have higher risks and some may have lower risks but it needs to measure the risks effectively for the best result.

 

Source:  http://www.canoninsurance.com/builders-risk-insurance.php

The Risks of Cheap Car Insurance

The cost of car insurance has always been a big headache for all of us. To most of us it seems something like wasting money until we actually need it. Naturally the car owners have a common tendency of finding out cheap insurance for their cars. I am not saying that this is wrong because certainly there is no harm in trying to save money. But, if you focus more on price than the safety and coverage then it may result in serious harm to you in near future. So, you should keep in mind some particular facts while finding or dealing with any cheap car insurance.

It is known to all that the cost of car insurance mainly depends on the type of coverage and safety offered by insurance companies. Depending on the car usage pattern and coverage requirement we may need different types of insurance coverage. However, there are number of companies who offer only basic coverage at a very lower price to attract us. But the wisest decision is to stay away from such policies as they are not effective enough and will not provide enough coverage while needed. I am suggesting this because I believe that coverage should be given equal importance to price, if not more.

As the competition in the market is increasing, the smaller and weaker companies are offering surprisingly cheaper car insurance policies just to survive. But, they are not capable enough to provide quality service and coverage. The problem is that all of them seem the same until you apply for a claim. But once you will face such situation that will be too late and understanding the fact at that time will not bring any good result for you. So, it’s better to be careful in advance. Even if you get coverage to some extent, that will take months to be processed because of the poor quality service. So, my suggestion will be to get coverage from a well-known company which may not offer you such cheaper policy but you will be provided the best possible services and coverage.

Another issue with the cheap car insurance companies is that most of them don’t have 24/7 live customer support. Perhaps they can offer you chat-support because they are always trying to save money by compromising service quality. Always remember that the insurance companies are here to do business, not to help you without interest. So, you will always get what you will pay. If you pay less you will get less. It’s a simple formula.

Remember that the companies offering cheapest deals are also following the same strategy you are.  They want to cut their costs and what they pay out just like you do.  There is the very real risk that they will try to keep the amount they pay out in if you have an accident to the absolute minimum.

So, don’t go for a cheaper policy without having enough understanding. First of all evaluate all the related facts and proceed with caution so that you can ensure the best coverage for your car.   Make sure to choose the most suitable car insurance policy according to your requirements and capability and if you do go with a super cheap company for your automobile insurance make sure that you read the fine print and understand exactly what they will pay out if you have an accident.

The Pros and Cons of PPO and HMO Health Insurance Policies

Health insurance has become a major concern for all and no doubt there are strong reasons behind that. But the effectiveness of insurance directly and indirectly depends on selecting the appropriate policy. So, choosing one among the available options is crucial to ensure the coverage and safety you want to get from your policy. As there are several factors to be considered and number of issues to be fixed it may be a hard task to find out an appropriate health insurance policy for you. Here I am describing the pros and cons of two most common health insurances HMO and PPO so that you can develop a clear idea about them and can select the most suitable one for you.

Preferred Provider Organization (PPO): PPO is one of the most popular health insurance plans. Let’s see what are the advantages and disadvantages you may have to face if you decide to get a PPO policy.

Pros:

• You will not have to choose and be tied to any particular primary health care physician.
• You will have access to a large number of facilities and physicians.
• You will be able to choose whatever physician or doctor to see for medical care.
• Having a referral to any specialist is not needed at all.
• While using a participating provider you will be able to fix a negotiated amount which will be less than the amount you would have to pay without the plan.

Cons:

• Almost always there will be a deductible to be met.
• There will be a co-insurance amount after the deductible is met which you will have to pay.
• PPO will cost you more compared to other plans because of the deductible, co-insurance and other out-of-pocket costs.

Health Maintenance Organization (HMO): Being different from PPO plan HMO health insurance plan has some pluses and some minuses which are needed to be considered with importance to determine whether it is appropriate for you or not. Let’s evaluate the pluses and minuses of HMO.

Pros:

• The premium you will have to pay for the HMO plan is comparatively lower.
• You will have to pay smaller co-payment for every visit which will fall in the range of $5-$20.
• Another benefit of HMO policy is that you will not have to pay any deductible which is a great way of going.

Cons: Besides these plus points there are also some minus points which you can’t overlook. The points are-

• The main disadvantage of HMO is less accessibility. As it offers lower premium you will have to face limitations in accessing doctors.
• There are also some limitations in services provided by HMO policy.
• HMO plans are more restrictive than the PPO plans.
• Lack of privacy is another drawback of HMO plan as the employees of HMO can review your record without your permission.

Choosing an appropriate health insurance plan really matters. So, evaluate all the factors and determine the most effective one to ensure maximum coverage at minimum cost.

The Most Common Types of Health Insurance

Now-a-days people are more health conscious and this is one of the major reasons behind the increasing popularity of health insurance. If you decide to get a health insurance policy you will find a number of options to choose from and there will be some crucial factors which you will have to consider. You will want to choose one which provides you the coverage and care you need at a cost you can afford. Some most basic facts which you will need to consider are your health history, kind of coverage the policy offers, affordability, whether the plan allows the option of choosing your own physician and so many other factors.

However, these factors may differ slightly depending on the types of insurance you will choose. Basically, there four major types of health insurance available in the insurance market. They are –

• Health Maintenance Organization (HMO)
• Point of Service (POS)
• Preferred Provider Organization (PPO) &
• Traditional

• Health Maintenance Organization (HMO): HMO insurance provides you the opportunity of choosing your primary physician who will be a part of the HMO network. The primary physician will be there by your side to fulfill all your immediate medical needs. HMO insurance also lowers your hospital visit cost and if you are admitted in that case your deductible will not have any limit. Under this policy if you need more extensive medical service then your primary doctor or physician will be responsible for referring you to another doctor.

• Point of Service (POS): POS insurance and HMO insurance are very similar. Here you can choose your own primary physician like the HMO insurance policy but the additional benefit you can get from POS insurance is that you will have the right to choose another physician who is out of the network or is not affiliated with the insurance network. The disadvantage of POS insurance is that you will have to pay a part of the physician’s charge from your pocket and this percentage may vary according to your policy rate. Generally the premium for POS insurance is higher than for other health insurance.

• Preferred Provider Organization (PPO):  A PPO insurance policy is slightly different from the HMO and POS policy as you will not have to choose your primary care physician in PPO and are not required to use only the network’s physicians.  Also, you do not have to get a referral from your primary doctor in order to visit another doctor or specialist.  You are also allowed to visit a physician who is out of the insurance network but in that case you will have to pay an extra amount from your pocket over what your company would pay if you went to one of their providers for the same service.   In PPO you can enjoy the no limit deductible cost. The main benefit of PPO is that if you get involved in a serious accident and taken to a medical service or hospital out of your network, you will not be punished financially rather the PPO will help you to cover your medical cost. But, in HMO and POS you will have to bear the total cost of medical emergency.

• Traditional: A traditional health insurance policy lets you to customize your plan according to your wishes.  This type of policy costs you a much higher deductible and has higher premium than the other plans. Though this is the most flexible of all plans, you are required to pay service upfront.

Take all of the factors and pros and cons for the different types of insurance plans into effect when choosing the policy that’s best for you.

Life Insurance – Why Everyone Needs It

Life insurance can be said both an investment and an insurance due to its characteristics. A life insurance is also an important part of all our financial planning. When you sign up for the life insurance, you get the financial protection against financial losses caused by the early or unexpected death. The life insurance policy guarantees to pay your beneficiary (spouse or others) the specific amount of money after you die and in exchange you pay premiums on a regular basis.

Reasons to Have Life Insurance:

There are number of reasons why everyone should get a life insurance without wasting time. Consider reading the most important reasons why life insurance is beneficial to you, me and everyone else.

• Assurance:This is a common fact that rainy days will come and go away in life but are you always ready to meet those days, maybe not. So, what will happen when you will pass away? This is the point why everyone needs life insurance. Because, when you have a life insurance you are assured that the needs of your beloved persons will be cared and your family will not have to face any financial hardship even after your passing away.

• Saving Your Family from Stress: Funerals requires lots of money and emotional strength. But at that time when your family will lose you forever they may be lacking of both strength and financial capability. So, it’s better if you make all the arrangements earlier by yourself to make them a bit stress free. You can do it with the help of life insurance. So, be practical and help your family while they will be helpless.

• Ensuring Future Income for Your family: No doubt all of us are afraid of death but the reasons are not the same. There are people who are afraid but not because of the afterlife, they are afraid of thinking what will happen to his or her beloved family after his/her passing away. But if you have a life insurance you are free from this tension. With life insurance you know how much your family will get even after you are gone. You can also arrange investment with your premium according to your own wish to ensure greater profit for your family. So, options are open for you. Make you beloved one’s future secured and get satisfied.

• Ensuring Permanent Care for the Dependent Family Members: If you have any beloved one in your family who is handicapped or dependent on other, it is obviously a matter of worry for you. But you can ensure his/her permanent care for the rest of the life even after your life leaving enough money for her/him by getting a life insurance.

• Eliminating Chance of Debt: Death can be expensive as there may have medical expenses, burial and funeral expenses. It means your family may sink into debt if you don’t have enough arrangement for that. Getting a life insurance you can eliminate this chance of your family’s sinking into debt quite easily.

So, what are you waiting for? Go and get your life insurance to secure the future of your beloved one.

Is Travel Insurance Worth It?

You have been dreaming of an adventurous vacation full of excitement and thrill to somewhere far-away for years and finally you are very close to make your dream turn into reality.

What happens if at the last moment an emergency arises and you have to cancel your trip?   At that point you would lose most if not all of your money.  This is the point where travel insurance comes into action. Travel insurance has been around for longer than you might think. Travel insurance helps travelers by covering various last minute emergencies and cancellations.  Be aware though that not all policies are the same.  Checking exactly which areas a particular policy covers is important so you know what exactly is covered under the policy and what isn’t.

Starting from forced-to-work cancellations to medical emergencies there are wide varieties of coverage in travel insurance and these can range from $40 to several hundred dollars. You may be thinking why should you increase your expenses by buying a travel insurance policy when the tour itself is a costly one and you are certain you will be taking it.   That’s common thinking, but travel insurance may be required for a number of reasons such as work interruption, weather, medical and others and the cost of policy varies according to reasons of coverage.   Things happen.  Even fluke events.  Remember a few years ago when that volcano erupted in Europe and all of those people were stuck for weeks?

While purchasing a travel insurance policy read the terms and conditions properly to make sure that you are not paying for getting coverage for those areas which are already covered by other insurances you already have such as that through a credit card provider. You can take help from your insurance agent in this regard so that everything is done perfectly. You can also obtain your policy through your travel provider or travel agent.

When You Need It: Just imagine that you are going overseas to attend an important event but due to some unexpected reasons your flight is delayed and you are going to miss the event totally. It’s really frustrating but if you have travel insurance you can cover the expenses (at least some of them) associated with the delay.

You may also face activity related injuries and rental car damages which are also covered by a travel insurance policy. If you want to cover the rental car damage with your auto insurance it will increase your auto insurance premium. So, it’s better if you pay a bit more for travel insurance to get rental car damage coverage. But, the more areas you will want to cover with the policy the higher the policy will cost you. So, be selective and make logical assumption which areas you should give more importance for coverage.

How to Get Affordable Life Insurance

Can you guarantee that you will be alive tomorrow, next week or even next year? You can’t.  No one can.  None of us know exactly how much time we have left.   Now just think what would happen to those near and dear to you if you are no longer there in their lives.  While it’s true that you can’t escape from death, you can still you can help them without being in this world by making sure that you have life insurance to provide for them when you are gone.   Though life insurance can’t save your life, it can help your family and loved ones in the event of your death – perhaps the insurance will help your family remain in the house or even help your children afford to go to college.

So, no doubt taking life insurance policy is a wise decision, but the question you probably want to know is how can you get an affordable life insurance policy.  Affordable life insurance is readily available everywhere. You just have to understand your basic requirements and then have to select the one which suits you most in terms of both premium expenses and how much coverage you want it to provide.

Here are some tips for you which will help you get affordable life insurance.

• The world economy has become quite unpredictable. So, it’s important that you choose an insurance company which has been in service for at least 20 years or longer and has proven they have the ability to survive in critical situations.  You don’t want to pay in to a policy and have it not be there when your family needs it to be.

• Understanding the terms and conditions of the policy is crucial. Don’t hesitate to ask your agent whatever you want to know.  You want to make sure that you understand what is covered under the policy (ex: what causes of death are covered) and what is not.

• You will find number of insurance companies over and they all sound the same.   Don’t fall into trap of being taken in by a great ad. Compare the details of policies offered by different companies, talk to people personally who have experience of purchasing such policies and carefully analyze the before sales and after sales service quality of those companies. Doing this you will have a clear idea and your own point of view regarding these policies.

• An issue you should take into consideration that the healthier you will be the more affordable the life insurance policy will be.  So, try to purchase life insurance policy as early as possible. You can also put all your insurance policies in the same company which is also a wonderful way of getting affordable policy with cheaper rate.

So, take a bit stress, do simple research and make a wise decision to ensure your loved ones stress free and secure future. It’s your turn, do it now. Who knows that tomorrow will give you a chance or not.

Course of Construction Insurance – The Facts You Need to Know

The course of construction insurance  policy, also known as the builder’s risk insurance policy, is a specialized property insurance policy designed and developed for providing coverage for the buildings or structures while under construction. The value of the building or property which is being constructed is covered by this policy until the building is ready for occupancy. This policy can be placed either for protecting or covering the whole project of constructing new building or for rehab project. As the course of construction is very important to protect the property, you may need to know some facts which will help you to handle the policy effectively and efficiently. Here are some facts which you should keep in mind while dealing with a builder’s risk policy or course of construction insurance policy.

• Understanding Project Cost vs. Replacement Cost:While going to start a renovation or construction project you first need to understand the actual differences between the budget of the project and the project’s value of replacement. Anticipated finished replacement cost is an important factor to prepare the policy. So, understanding this fact will help you understanding the insurance process. Most of the time the owners overlook the associated costs such as permit fees, property’s foundation cost, design fees etc. but that is not a good practice at all.

• Security Measurement:Another crucial fact you should consider while beginning a construction project is the security measurement. The extent of the security arrangement and precautionary initiatives depends on the anticipated cost of replacement of the property at the end of the construction project.There should be fire extinguishers on every 1000 square feet in the property. Temperature alarm, perimeter fencing, motion censored lighting and fire alarm should also be placed on the construction site to ensure the safety which is also included into the policy.

• Potential Coverage Gaps:While some insurance policy carriers ensure the construction project on the basis of anticipated cost of replacement of the property at the end of the project, some carriers may ensure the project on the basis of the current replacement cost. So, it’s important for you to know which method your carrier is using to give you protection. If any wrong or incomplete information is conveyed to the agent o carrier regarding the project, there may create some gaps in the coverage.So, carefully maintain the communication and the flow of information for maximum coverage from the policy.

• Other Areas of Concern:Besides these there are some other issues and facts which you should consider to avoid unexpected coverage gaps.  Workers compensation, unlicensed contractors and waiver of subrogation are such facts which should be given importance.

The process and procedure of ensuring your renovation or construction project may seem to be a daunting one but if you understand the actual replacement value and budget of the project it will make your job half done. So, maintain timely and clear communication with your agent and carrier and maximize your coverage removing potential gaps.

Disability Insurance – Who Should Get it?

Every insurance policy is designed to give the policy owner financial protection against disastrous events. If I ask you what your most valuable asset is, you will mention your home, your car, jewelry and other possessions. But, is any of them more valuable than your ability to earn a living; probably not. We often get our assets insured but forget to insure our income. Just think what would happen if you no longer be able to work? How would you –

• Pay your bills?
• Save for retirement?
• Make loan payments?
• Bear children’s education expenses?
• Buy groceries?
• Make car payments?

Yes, those are the points you should think about now. According to National Underwriter Field Guide 2004, at the age of 40-65 the chance of your becoming disable for 90 days or more is almost 43%. But, unfortunately most of us don’t feel or realize the risk of being disable at all. However, if you can now feel the necessity of being insured then the best solution to this issue can be ‘Disability Insurance’.

Disability Insurance: Disability insurance (also known as disability income insurance) is a special form of insurance which insures the beneficiary’s timely income against the risk that disability will make working impossible, painful or uncomfortable. During the period of disability the insured gets regular compensation from the insurance company. The amount of pay out may be stated as a fixed amount or a percentage of the income. The amount and period you will be provided compensation will depend on the policy. The longer the benefit period will be, the higher the premium will be.

Benefits of Disability Insurance: The protection and support provided by disability insurance to the policy owner is priceless in a word. It helps the injured to maintain the standard of living close to what it was before the accident. According to some policies the rehabilitation process may also be covered by disability insurance.

Who Needs Disability Insurance?

If you are one who is directly or indirectly dependent mostly on his income, then you are a candidate for disability insurance. So, everyone with a job needs disability insurance. In future if you lose your working ability due to any disastrous event make sure that you will have enough money to support yourself, your family and other needs until you make a comeback in work.

According to National Safety Council 2008, the total cost of unintentional injuries was $652.1 billion in 2006. There occurred a disabling injury in every second which was 26.2 million in number and 3.7 million of those were related to work. 96% of all claimants in USA have reported that they might have suffered badly due to financial hardship without their disability insurance coverage. I hope this information will change your idea about the issue to some extent and will make you a bit more conscious about disability insurance and its importance.

So, what are you waiting for? Change your mind and protect your income before any unexpected event changes your life forever.

10 Tips for Lowering Car Insurance Rates

Car insurance policies can be costly these days.  Given the economy now it just makes sense to try to lower your car insurance rates if possible.   There are number of factors which determine the annual rate of car insurance such as the type of insurance policy, the type of car which is being insured, the year of experience of the driver, the age of the driver and so on.   Still, there are some very effective factors which can help you lowering your car insurance rate.

Here are 10 tips for you on how to lower the car insurance rate effectively.

1. Higher Deductible: This is the amount the car owner pays upfront before the insurance company settle a claim when an accident takes place. If you pay a higher deductible your yearly car insurance rate will go down substantially.

1. Keep Exploring the Market: Keep searching for a suitable company that offers a lower rate until you find one.  You may not find a well-known one with cheapest rate but still there will be some with an impressive background and relatively lower rate.  If you go this route check with the Better Business Bureau to make sure that the company has a good rating and actually pays out if you have an accident.  Some super cheap companies do everything to avoid having to pay if there is an accident.

1. Getting Multiple Policies: If you need other insurance policies also then try to get them all from the same company. This is a good way of getting some discounts in rate. Ask your company what type of multiple policy discounts they offer.

1. Maintain a Good Driving Record: Maintaining good driving record is a great way of lowering annual car insurance rate because  it’s the greatest factor in determining the rate of insurance.

1. Good Credit: Nowdays many of the insurance companies look at your credit score to determine if you are a good risk or not.  Try to improve your credit as it can save your money in the long run.

1. Determine the Amount of Coverage You Need: If your car is totally paid off and an older one, is it needed to have full coverage for that car? If you drop some of the coverage it may benefit you financially.

1. Compare Cost of Insurance Before Purchasing Your New Car: Call your insurance agent while purchasing a new or used car and ask him to determine what the rate would be. Now consider the rate whether it is appropriate for the car or not.

1. Complete a Driving Education Course:  Completing the driving education course through your insurance company  can help lower your car insurance rates.  Check with your agent to see if your company offers such a course.
2. Get a Low Miles Discount: You can get a discount in your car insurance rate if you don’t drive for long distances and maintain a low mileage rate.

1. Anti-Theft Device: If you have an anti-theft device installed in your car it may help you lowering your annual car insurance rate so make sure to let your agent know.  Many cars these days come with some form of protection.

Using even some of these simple tips can help you save hundreds of dollars each year on your car insurance.  It’s important to check at least once a year with your agent to see if rates have gone down or the insurance company is offering any other driver discounts that you may qualify for.