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    Personal Insurance Blog

    Wind Deductible vs. Hurricane vs. Named Storm Deductibles

    Posted by Geoffrey Gordon

    Thu, Aug 15, 2019 @ 09:40 AM


    You call the insurance company after a big nor'easter or hurricane, with a tree sitting on your house, and they tell you that you have a "wind deductible."  What's that?  

    It's a separate deductible from the one that applies to everything else to lower the cost of storms to insurance companies in wind-prone regions.  There are a few variations beyond just "wind," and we'll look at which are better (if your location limits your choices and have this provision).

    House damaged by tree-927040-edited.jpgWhen a storm hits, the distinction between Named Storm deductibles, Wind storm deductibles and Hurricane deductibles can be important. The distinction is particularly important if you live or own property in a coastal county in Massachusetts, such as Plymouth, Dukes, Barnstable, Bristol, Suffolk and Essex, because all are generally available and choosing the right one might make a difference in the cost to repair your home after a storm. 

    Here's how it works:  these deductibles are applied separately for a higher dollar amount than your standard deductible, known as “all other perils” (AOP) deductibles.  For example, if you have a $1,000 deductible for fire, theft and all other perils and you live on the coast, you may have a $2,000 or higher deductible for windstorm and hail losses.

    More common than dollar amounts however, wind deductibles are often expressed as a percentage of the coverage amount on your home. For example, a 1% wind deductible on a $300,000 home would be $3,000 and a 2% wind deductible would be $6,000.  A 5% wind deductible on a $700,000 home is $35,000!!  Here in coastal Massachusetts counties, 1%, 2% and 5% wind deductibles are common if your property is within a mile of the coast.  

    These deductibles are part of an effort by the insurance industry to limit their storm losses by having homeowners share more of the repair costs when the wind blows.  Informed property owners - that's you - can take steps to protect homes when especially vulnerable to wind damage.  After all, if you have a 5% deductible on half a million dollar house, you’ve got 25,000 good reasons to consider storm shutters, a generator, the highest quality shingles, fewer trees in the yard, and other protections. 

    If you have a wind deductible it normally will appear right on the "declarations" (first) page of your homeowner’s insurance policy.   Different insurance companies use different metrics for these specific peril deductibles. The three most common approaches are:

    1. Windstorm deductibles (the broadest, meaning it will affect the most people)  
    2. Named Storm deductibles (common) and
    3. Hurricane deductibles. 

    The broadest of these three, meaning where it will apply to the most consumer claims, is a Windstorm deductible.  These deductibles apply whenever damage is caused by wind; these include not only hurricanes and other tropical storms but also winter nor'easters and summer thunderstorms.   Any kind of wind damage will prompt this higher exposure to the owner.

    The next category is Named Storm deductibles.  To illustrate, remember the notorious “no-name" storm?  Damage from that storm would not have been subject to a higher Named Storm deductible, but would have under a Wind deductible.  The regular, smaller AOP deductible would have been used for any damage caused by the no-name storm under a Named Storm deductible.    But damage from Hurricane Irene or Hurricane Sandy, or other named storms would have invoked the Wind and/or Named Storm deductible. 

    Finally, there are the most restrictive Hurricane deductibles.  Hurricane Sandy is a good example of the distinction between Named Storm and Hurricane deductibles.  When Sandy made land fall in New Jersey she had been downgraded from a Category I hurricane to a tropical storm. Thus, the lower AOP deductible applied to folks with a Hurricane deductible. Hurricane deductibles have become less common due to the potential for political interference after the fact, as was evident with Sandy.  Some suggested that the downgrade of Hurricane Sandy was precisely announced to shield homeowners from the Hurricane deductible.   Good for consumers with that one event, but insurance carriers quantify risk precisely, and after the fact interference prompted changes for the next event.  Thus what were Hurricane deductibles have morphed into Named Storm deductibles in most coastal regions.

    Many considerations should factor in your choice of insurance companies for selecting homeowners and other property insurance.  But all else being equal, and given the option between Windstorm vs. Named Storm, choose Named Storm as it is more restrictive. Given the choice between Named Storm and Hurricane deductible, you should choose a Hurricane as it’s the least likely to be invoked.  

    For more information on the subject, check out our short but super-informative whiteboard video where we give cost examples of various deductible options near the coast.

    If you've just discovered you have a higher wind deductible than you are comfortable with, contact us at 800-649-3252We can also research better offers for you - just click the link below. 

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    Geoff Gordon

    Tags: insurance, homeowners, storm, deductible, wind, windstorm, Coastal, deductibles, named, all other perils, AOP

    Insurance Haikus

    Posted by Gordon Atlantic Insurance

    Fri, Feb 17, 2017 @ 12:54 AM

    Insure your home with homeowners and enjoy insurance haikus from Andrew Gordon IncYes, that’s right. Haikus. Like the ones you wrote for the much hated poetry projects in English class. These are the result of an attempt to diversify our blog towards other content. So if you like this, drop us a comment (maybe your own insurance haiku).

    Homeowner's

    Keep track of your stuff
    Take video and pictures
    For we will rejoice

    (Seriously, knowing what you own and keeping record will save you time and money if you file a homeowner's claim. Click here for our Homeowner’s Checklist)

    Prepare for storms and hurricanes with homeowners and haikus from Gordon InsuranceHurricanes

    No wind coverage
    Time is ripe for hurricanes
    Sorrow for the coast

    (Get a quote from us, or watch our educational Wind & Named Storm Video)

    It’s an act of God
    Tree bough rains down on your car
    Need comprehensive

    (Comprehensive coverage is designed for just such a situation. Comprehensive Coverage applies when a car’s been damaged by either a natural or civil disturbance (such as a hail storm, a falling tree, or an act of vandalism)).

    Understand driving laws and cover yourself and your automobile with auto and haikus from Gordon InsuranceAuto Insurance

    Failure to signal
    This driver cannot escape
    The standards of fault

    (The operator of a vehicle shall be presumed to be more than 50% at fault when operating a vehicle which is in collision while failing to signal as required by law before turning or changing lanes. Use your blinker!)

    There’s a new driver:
    Junior Operator Laws
    Are strict; drive safely

    (click here to see the Junior Operator Laws and implications)

    A new text message
    While driving on the highway
    Please don’t answer it

    (The new safe driving bill outlaws texting REGARDLESS OF AGE, for the details on this new legislation, click here)

    Andrew Gordon Inc provides all your home auto life and commercial insurance needsInsurance

    Visit our website
    It is Agordon dot com
    You will not regret

    Learn more about personal insurance here.

    Home Quote Request  
    Corbin Foucart

    Tags: rates, insurance, cheap, homeowners, rental, car, homeowner, poetry, haiku

    Pool Laws and Insurance

    Posted by Gordon Atlantic Staff

    Tue, Aug 19, 2014 @ 11:15 AM

    Insure your pool with a personal umbrella liability homeowners policy from Andrew G Gordon IncDo you already have a swimming pool, or are you thinking about getting one? Make sure you're aware of the laws and risks that come with pools. Abiding by the state laws for private pools not only protects the lives of those using the pool, but also ensures that you avoid fines from your homeowners insurance company or the Massachusetts State Board of Building Regulations. 

    Pools must be surrounded by a fence four feet or taller, with a self-closing gate. Doors from your house leading to the pool must be alarmed. Swimming pools must be at least 20 feet away from the borders of the property lot, and they shouldn't be near your septic tank. 

    Did you know that even inflatable pools you buy from Wal-Mart need a building and electrical permit (if they hold 24 or more inches of water in height)? You and your kids should have your outdoor fun, but be careful and contact your city or town hall. 

    To save on your energy bill for your pool, get a solar cover to heat the pool for free and prevent evaporation. Keep your filters clean so that the pool runs smoothly.

    Insure your pool by increasing your liability and home insurance. Pools count as "other structures" under your home insurance policy, which are typically given 10% of coverage for the amount written for your home (if your homeowner's policy is $150,000, then your other structures are covered with $15,000. If this isn't enough, increase it with your home insurance agent). 

    Contact us with any questions about your homeowner's insurance or for a personal umbrella policy quote. Read some more about swimming pool laws and insurance at insureme.com and coverhound.com (thanks to them for supplying much of the information in this article). Have a safe and happy summer!

    Home Quote Request  Top 10 Things about Home Insurance

    Tags: home, insurance, laws, massachusetts, homeowners, pool, swimming, personal umbrella

    How to Lower Your Energy Bill

    Posted by Gordon Atlantic Staff

    Thu, Aug 14, 2014 @ 10:37 AM

    Lower your energy bill and get homeowners insurance from Andrew G Gordon Inc

    Save on more than just your insurance with these energy tips.

    1. Turn your thermostat up two degrees in the summer and down in the winter. About 30% of your home energy bill comes from heating and air conditioning.
    2. Take a shower instead of a bath! (You probably already do this, but isn't it nice to know you're saving money?)
    3. Don't let your water run while you shave or brush your teeth; a little conservation goes a long way. 
    4. Use cold water whenever possible! My family washes all of our clothes in cold water. We also use even less energy by hanging nearly all of our clothes up to dry instead of putting them in the dryer; this helps clothes last longer, too!
    5. Instead of using the oven to heat up every snack, use the microwave, toaster, or something that consumes less energy.
    6. The refrigerator uses more electricity than any other appliance in your house (except for maybe your heater/AC). Even if you just leave the door open to get a glass of milk, close it!
    7. Get drapes with insulating liner for your windows to cut heat loss in half.
    8. If you have a pool, use a solar cover to heat it with the sun and prevent the water from evaporating.
    9. Get energy saving light bulbs (the kind with the twisted pipes)! Not only do these save energy, but I've found them to be brighter and last longer than regular light bulbs.
    10. Wait for full loads with your dishwasher and clothes washer to get the most out of your water use.
    11. *If you opt for online payments instead of paper mail with many insurance companies, you'll get discounts! (This isn't on your energy bill, but it's on your carbon footprint!)

    Contact us with any questions, and learn more about homeowner's insurance on our website. Be smart and go green! Get some more tips at consumersenergy.com.

     

    Read more blogs about going green and saving energy (and money!):

    -Go Green for Safety's Sake

    -Green Discounts

    INSURANCE QUESTION?  Top 10 Things about Home Insurance

    Tags: environment, green, electric, insurance, massachusetts, homeowners, energy, bill, how to lower energy bill

    Insurance Scores

    Posted by Donna Bellavance

    Tue, Nov 12, 2013 @ 09:00 AM

    When writing insurance policies and homeowner policies in particular, agents are now required to obtain much more detailed information than in the past.

    Learn about insurance scores and homeowners from andrew g gordon incPreviously, agents have been expected to gather details about the home, such as year of construction, type of construction, style of home, and updates to the structure and internal systems. This information helps insurance to get a sense of the risk involved with writing a policy for the home.

    While it is still very valuable to insurance agents to know the characteristics of a home before insuring it, especially involving any previous damage it might have incurred, they also must consider human factors when developing your insurance policy.

    Claims history is a very useful tool for agents to understand your history as an insurance customer. Although this does not provide any more information about the structural soundness of the home to be insured, it helps to develop a risk profile of a customer, and how likely they are to place a claim in the future. In the case of home insurance, claims history will be provided for both the insured customer as well as the home itself, so if the home in question has recently been purchased, claims filed by a previous owner will be included in the history.

    Insurance scores are a numerical value determined by certain characteristics of a customer. In many ways, they are comparable to the financial credit scores involved with money lending. However, insurance scores predict the risk associated with a customer, instead of credit, and the values of the two are not necessarily related to one another.

    At this point in time, Massachusetts only requires insurance scores on homeowner policies whereas other states require this on auto policies as well.

    If you have any questions about how these changes may affect you personally, please contact us and we will try to help you. Learn about your home insurance options here.

    Home Quote INSURANCE QUESTION?

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    Tags: claims history, insurance scores, policy change, scores, homeowners insurance MA, homeowners

    What is an Additional Insured?

    Posted by Sue Bird

    Wed, Jun 26, 2013 @ 04:33 PM

    Learn what an additional insured is with homeowners insurance from andrew g gordon incAn "Additional Insured" designation on a Homeowner's policy is used when someone who has a financial interest in the property does not live at the residence. This could be an ex-spouse, relative, or deceased spouse (estate) who's name is still on the deed or mortgage. It provides that entity with coverage the Dwelling and Other Structures coverage as well as Personal Liability and Medical Payments in respects to the residence premises only.

    Keep in mind that the person listed as an Additional Insured on the property would also be sharing the Personal Liability limits on the policy with the Named Insured/Policyholder. It would be wise, if possible, for the Additional Insured to also extend liability coverage from his/her own Homeowner's policy to the property that he/she owns but does not live at so that he/she has the full amount of Liability Coverage afforded under his/her policy.

    Any other questions? Feel free to contact us. Learn more about home insurance here.

    INSURANCE QUESTION? Home Quote Request

    Sue Bird

    Tags: Additional Insured, home insurance, home, homeowners policy, estate, named insured, policyholder, homeowners, insured, dwelling

    Why Do I Need a Home Insurance Inspection?

    Posted by Gordon Atlantic Insurance

    Wed, May 01, 2013 @ 07:16 PM

    Do you need a homeowners insurance inspection? Gordon Atlantic InsuranceHave you been asked to have your home inspected for a new insurance policy? Don't be alarmed. The primary reason is to make sure the policy's dwelling amount reflects the cost to rebuild the home in the event of a total loss. When you receive an insurance offer, replacement value calculation software is used by your insurance representative to estimate the home's replacement cost, or cost to rebuild from the ground up. The software is good, and often draws from public records, but every property is unique so the best way to validate the cost to rebuild for the homeowner is through an insurance inspection.  

    The other reason for an inspection is to see what kinds of hazards might exist, and whether they can be corrected.  Inspectors are trained to recognize those conditions that raise the risk of a loss, such as roofs in need of repair or dangerous conditions not known from a phone conversation or web form.  But as the entity who has the most to lose when risky conditions exist, many carriers insist on inspections to protect their interests. 

    It has become common for home insurance companies to conduct insurance inspections within 30 days of a new policy's inception date. Previously, insurance companies or the agent may have taken exterior pictures and or measurements of the property; today these are available on line.  Now  inspections often include a walk through of the interior as well.

    The home insurance companies often outsource to licensed independent insurance appraisal companies such as Mueller Inspections. The inspection company will contact you directly to arrange for the inspection. Most inspections typically take about 30-45 minutes.  You will need to be home for the inspection and should expect that the inspector will ask to see each room along with the basement and furnace. They will also take pictures of your home from both inside and outside.

    Homeowners insurance inspections Gordon Atlantic InsuranceThere are two primary purposes of a home inspection:

    1. To validate the replacement estimate calculated with a combination of public information and information you’ve provided, and,

    2. To identify conditions where a loss might occur: safety items such as a deck with no handrails; or susceptibility to loss, most commonly water.

    What will be inspected?

    The inspector will generally measure external dimensions; property tax information is not always accurate. They will often ask about the age of the roof, will inspect gutters and downspouts to be sure they are connected properly, and review installation or updates to furnace, electrical system, and plumbing.  If you have a dog, they may also ask questions about his temperament and may even take a picture of the pup if he is photogenic (dogs account for about 30% of personal liability claims payments nationwide).

    If you are buying a house, be honest with your insurance agent if you are moving into the home right after the closing or if you are planning to remodel the home. Both situations can be addressed ahead of time but it is always best to handle while setting up the policy.  An insurance company can cancel a policy for misrepresentation if there is major remodeling and/or you have not moved into the property.  Underwriters don't like surprises.  Honesty is always the best policy.

    Benefits for you

    Other benefits of a home insurance inspection can be that discounts are identified by the inspector that the customer was not aware of. For example, some homeowners with central fire and burglar alarms may also have low temperature sensors. Or the home has an automatic generator that we never knew about.  These situations may prompt additional discounts.

    When the home inspection is complete, it goes to the insurance company. An underwriter reviews the building coverage and will outline concerns (hazards) that need to be addressed with the homeowner.  If action is needed, it is forwarded to the agent, who communicates any changes or concerns or requests from the carrier to the customer.

    Having your home inspected helps keep the cost of insurance down. Companies that conduct thorough inspections get discounted rates on reinsurance which this is passed along to customer Reinsurance is the insurance that companies buy to protect themselves from large individual losses or many catastrophic losses. 

    The home insurance inspection can be a simple process providing peace of mind that your home is properly insured and that losses can be avoided by recognizing risk through the eyes of a professional.

    If you would like to discuss your homeowners coverage with a Gordon Atlantic Insurance professional, please call us toll free at 800-649-3252.  Prefer to type versus talk?  Use the form at the top left of this blog.

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    Tags: house, home, policy, homeowners, insurance cost, water, home inspection, water insurance

    Public Adjustors, Company Adjustors and Independents - Defined

    Posted by Geoffrey Gordon

    Thu, Feb 14, 2013 @ 08:52 AM

    Cover your home and learn about public adjustors with homeowners from andrew gordon incWhen you have a claim, an adjuster will help organize and quantify the payment of your claim.  There are different kinds of adjusters though, and it pays to know the difference.

    Once your claim is reported to the insurance company, they may assign their own staff adjusters.  Carriers don’t have incentive programs for adjusters to pay less than what the contract calls for.  They do of course have a supervisor or auditor making sure they are paying market rates, replacing only damaged items; in short, not overpaying.  Their main job is to get contractors paid for repairing your loss and get you reimbursed for your personal property, so they can move on to the next case they’ve been assigned.

    Some companies use independent adjusters.  It is cheaper not to have payroll between storms when things are quiet, so carriers use independents instead of staff, or just when they need to.  Independent adjusters are vetted by the insurance company to make sure they understand what's actually covered by your insurance policy, as well as the building and trades business. They make sure contractors hired to make the repairs are charging a fair market rate for the work done and they are paid a fee by the insurance company for this service.

    After a big weather event with lots of claims, many companies will hire independents to take up the backlog, so a combination approach is common when it's busy.

    Public adjusters serve a different function. They are paid by the customer via a fee calculated off the total amount of the claim. This is good in the sense that their incentive is to collect as much money as possible from the insurance company so you're on the same side of the table.  But you should be cautious when using a public adjuster, too:

    • A public adjuster's fee may run 5%-10% of the gross settlement depending on the claim. If your house sustains $50,000 in damage, 5% will cost you $2,500 and a 10% rate would be $5,000. It can get expensive.  
    • A commonly heard downside is the time it takes to get work done. Inevitably, with a public adjuster there is a lot of negotiation; their job is to push the envelope to get as high a dollar figure as possible to settle your claim. These negotiations inevitably take more time and work may stop with progress toward returning you to your home or car halted.  
    • If you are going to use a pubic adjuster, read the contract carefully before you sign, and never under undue pressure!  Many PA contracts are exclusive to the job, meaning once you sign up they become your only advocate.  Look for a cancellation provision:  many contracts stipulate you can’t fire them until the job is done. If this is the case, there is no accountability mechanism for poor results. 

    Insure your home and learn about indepent or public adjustors with homeowners from Andrew Gordon Inc

     

     

      5 Things to Know: Home Insurance  

    Geoff Gordon

    Tags: home, company, insurance, homeowners, public, PA, PAs, adjustors, independent

    Winter Storm Nemo

    Posted by Gordon Atlantic Staff

    Wed, Feb 13, 2013 @ 08:13 AM

    If you're reading this, then congratulations, you have power! If you aren't reading this, then you don't!

    Cover your home for winter storms with homeowners from Andrew gordon incWinter Storm Nemo (dubbed so by the Weather Channel) caused a lot of damage. Whether you want to believe this violent storm was named after the cute little clownfish from Disney/Pixar's Finding Nemo, or after Captain Nemo from Twenty Thousand Leagues Under the Sea, or even after the Latin word meaning "no one", absolutely nemo can say that Nemo was just like any other winter snowfall. (Hahaha, see what I did there?)

    However, the effects of Nemo are not a laughing matter. In fact, Nemo caused quite a lot of damage. You can see on the right, a picture of a tree sliced into two from a falling tree branch. (Sorry the quality is bad; I took the pic on my phone.)

    More than 97% of my town went without power for days; some homes still do not have electricity. Trees snapped, branches broke, and for the first time since 1978, the Massachusetts governor, Deval Patrick, banned driving on the roads. The penalty for breaking the ban was heavy- a $500 fine and a one-year prison sentence.

    Personally, I think the driving ban was well within reason. Granted, my neighborhood is enclosed by lots and lots of trees, and the snow piled up rather quickly. I remember hearing copious amounts of snow falling from the tree branches onto my house and listening to trees snapping as if they were only toothpicks. Snow is heavy, and all the extra weight on the trees caused quite a lot of branches (as well as trucks) to fall to the ground, occasionally taking power lines down with them.

    What's even more scary is that trees landed on houses, garages, cars, fences (our fence fell victim to the collapse of a smaller tree) and destroyed A LOT of property. Besides the whole electric inconvenience of not having electricity, the places where people lived got damaged- and that let in even more cold.

    Fortunately, my family invested in a generator after Hurricane Irene two summers ago. Thank goodness we did that. Although the summertime is generally warm, with slight chills in the night, the generator during Irene helped a lot. And now, especially that Nemo took place during the wintertime, the generator provided much needed heat to our home when our fireplace couldn't do the job. So, as a word of advice, I recommend purchasing a generator for the next time there's a power outage. With that generator, make sure you buy gas to fuel it (we had to refill ours two or three times before we got power back). And if you plan on investing in one, be sure to do it sooner rather than later. Imagine all the people who think about purchasing generators immediately before storms, and then imagine the stores being out-of-stock when it's your turn to purchase. Don't be that person left out!

    If you need to file a claim, click here. If you have any other insurance questions or would like some more safety advice, feel free to contact us.

    INSURANCE QUESTION? Winter Storm Center

    Tags: home, winter, damage, insurance, homeowners, storm, weather, snowfall, nemo, blizzard

    Why Did My Home Insurance Premium Go Up?

    Posted by Gordon Atlantic Staff

    Thu, Jan 17, 2013 @ 03:11 PM

    Ice storms, snow storms, tornadoes,  hurricanes- oh my! These were just a few of the catastrophic weather events that Massachusetts homeowners faced over the past few years.  

    Homeowners learn why your home insurance premium may rise with andrew gordon incWhat does this have to do with your  home insurance premium rising?  

    Throughout the insurance industry, these weather happenings resulted in record setting property damage and home insurance claims.  Across the board, insurers evaluated the adequacy of their home insurance pricing  after catastrophic events slammed insurers balance sheets in recent years. 

    What is the net result? 

    Home insurers will be charging more to cover expected claims and the rising cost of reinsurance- the insurance on their insurance. Many insurers rate increases are in the 10% range. In addition, stricter underwriting guidelines are being used to determine eligibility including distance to the coast and timely premium payments.  The net result is the home insurance market is tightening for Massachusetts consumers.

    If you were one of the lucky ones not impacted by weather events and or did not file a claim, a premium increase is a particularly  tough pill to swallow. Or if you did file a claim, a premium increase is still hard to understand particularly if this was the first time that you ever filed a home insurance claim.

    How can I get the best price?

    Our agency www.agordon.com  reviews home insurance renewals for customers to make sure the best priced option and coverage is provided to our clients.  An example, over the past few months, I reviewed several home insurance renewals for four customers. The rates increased in the 10% range for each of these homeowners. None had filed a claim and all were taking advantage of discounts including account credits for bundling auto and home insurance together.  We went to work and compared pricing with more than a dozen companies for each customer. The analysis showed for each of these customers that their current home insurance program was still the best priced option even with the premium increase. 

    For each of these customers, we made other suggestions to save premium. Three of the customers opted for higher deductibles and the other decided to self insure some scheduled jewelry listed on the policy. The net result was all four customers were able to reduce their premium back to the price they were paying the previous year. 

    If you are looking out the window at the moderate temperatures on the thermometer and dry pavements, record setting meteorological events may be a mere memory. It’s not quite the same recall for home insurers as they tally their balance sheets and continue to adjust rates. You can be assured that our agency www.agordon.com strives to assure the best priced option and coverage is afforded to all new and renewing customers. Learn more about homeowners insurance here.

      Rising Insurance Rates Download Home Quote Request

    Tags: home, rates, cost, increase, personal, rising, 2012, insurance, massachusetts, homeowners, premium

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