FREQUENTLY ASKED QUESTIONS

For your convenience, our most common customer questions are answered here. If you do not find the answers you are looking for, please reach out directly and we will be happy to assist you.

HOMEOWNERS INSURANCE FAQ'S

Unlike driving a car, you can legally own a home without homeowners insurance. However, if you finance your home with a mortgage, your lender most likely will require you to have home insurance coverage to protect your home in case of damage cause by unforeseen circumstances, such as fires or natural disasters.
A flood certification indicates if the subject property is located within a designated flood zone. If the property is located within a flood zone, the borrower must obtain flood insurance.
An Elevation Certificate is an important tool that documents your building’s elevation. If you live in a high-risk flood zone, you should provide an Elevation Certificate to your insurance agent to obtain flood insurance and ensure that your premium accurately reflects your risk.
Florida insurance companies are not required to automatically sinkhole coverage on new or existing homeowners’ insurance policies. However, they are required to inform homeowners that sinkhole coverage is available for an additional premium.

1. Insurance companies must include “catastrophic ground cover collapse” which means: The abrupt collapse of the ground cover;

2. A depression in the ground cover clearly visible to the naked eye;

3. Structural damage to the building, including the foundation; and

4. The insured structure being condemned and ordered to be vacated by the governmental agency authorized by law to issue such an order for that structure.

Dwelling coverage, sometimes called “dwelling insurance,” is the part of your homeowner’s insurance policy that helps to pay for the rebuilding or the repair of the physical structure of your home if it’s damaged by a covered hazard.
Covers other structures around the property that are not used for business, except as a private garage. Typically limited at 10% to 20% of the Coverage A, with additional amounts available by endorsement.
Covers personal property, with limits for the theft and loss of particular classes of items (e.g., $200 for money, banknotes, bullion, coins, medals, etc.). Typically 50- 70% of Coverage A is required for contents, which means that consumers may pay for much more insurance than necessary. This has led to some calls for more choice. There are two types of policies for personal property: cash value policy and replacement cost policy. Cash value policy will pay the cost to replace belongings, minus deprecation. Replacement cost policy will reimburse the assured for the full, current cost of replacing belongings.
Covers expenses associated with additional living expenses (i.e. rental expenses) and fair rental value, if part of the residence was rented, however only the rental income for the actual rent of the space not services provided such as utilities.
Covers damages which the insured is legally liable for and provides a legal defense at the insurer’s own expense. About a third of the losses for this coverage are from dog bites.

HOMEOWNERS INSURANCE POLICY TYPE FAQ'S

A form that provides coverage on a home against fire, smoke, windstorm, hail, lightning, explosion, vehicles, and civil unrest. It does not cover the assured’s personal property, personal liability, or medical expenses. It is the type of policy a mortgage lender will buy for a borrower if the latter’s homeowner policy lapses.
A basic policy form that provides coverage on a home against 11 listed perils; contents are generally included in this type of coverage, but must be explicitly enumerated. The perils include fire or lightning, windstorm or hail, vandalism or malicious mischief, theft, damage from vehicles and aircraft, explosion, riot or civil commotion, glass breakage, smoke, volcanic eruption, and personal liability. Exceptions include floods, earthquakes. Most states no longer offer this type of coverage.
A more advanced form that provides coverage on a home against 16 listed perils (including all 11 on the HO1). The coverage is usually a “named perils” policy, which lists the events that would be covered.
The typical, most comprehensive form used for single-family homes. The policy provides “all risk” coverage on the home with some perils excluded, such as earthquake and flood. Contents are covered on a named peril basis. (Note: “all risk” is poorly termed as it is essentially named exclusions {i.e., if it is not specifically excluded, it is covered}.)
The Contents Broad or Tenants form is for renters. It covers personal property against the same perils as the contents portion of the HO2 or HO3.[10] An HO4 generally also includes liability coverage for personal injury or property damage inflicted on others.
Covers the same as HO3 plus more. On this policy the contents are covered on an open peril basis, therefore as long as the cause of loss is not specifically excluded in the policy it will be covered for that cause of loss.
The form for condominium owners. It insures personal property, walls, floors and ceiling against all of the perils in the Broad Form. The rest of the condo is covered by a separate policy purchased by the association.
The form is for the owner-occupied older home whose replacement cost far exceeds the property’s market value.

AUTO INSURANCE FAQ'S

These cover your legal liability, up to the limit you select, for damages caused in a covered vehicle accident. Under BI/PD, we pay for damages to an injured person and for property damage that you are legally obligated to pay as a result of an accident. If we cover an accident for which you are sued, we pay for a lawyer to defend you. You choose your BI/PD Limits of Liability as either Split Limits or a Combined Single Limit (CSL).

Split Limits divide bodily injury liability limits per person and per accident. We pay up to the limit you select per person, but we only pay up to the total limit you select per accident. For property damage liability, we pay up to the limit you select per accident. CSL combines your liability coverage into one total limit per accident.

Personal Injury Protection (PIP) coverage, commonly referred to as “no-fault insurance,” is available in certain states. If you are disabled or unable to work as a result of an accident, PIP covers your medical bills and often lost wages. In addition, it usually covers the cost of personal services you must now pay someone else to do for you. PIP coverage is subject to a limit, which is specified in the policy if available in your state.
Medical Payments coverage applies no matter whom is at fault and covers the cost of reasonable and necessary medical care provided to you as the result of a car accident. The coverage is often limited to a specified time period following the accident (usually three years) and the amount of coverage you chose when you purchased the policy.
Uninsured/Underinsured Motorist coverage pays for damages that you are legally entitled to recover for your bodily injury. In general, this coverage provides what you would have received from the other person’s insurance company had that person been insured. This coverage may also protect you if the person who caused the damage does not have enough insurance. Uninsured Motorist Property Damage coverage is also available in some states and provides protection for damage to property caused by a person without insurance.
Under Collision coverage, we pay for damages if your vehicle overturns or if it collides with another vehicle or object. Collision coverage involves a “deductible” amount you select when you purchase your policy. This amount, typically $250 or $500, is the amount you are required to pay in the event a claim exceeds the deductible amount.
Under Comprehensive coverage, we pay for damage caused by an event other than a car collision, such as fire, theft, vandalism, hail, or flood damage. Comprehensive also covers damages from an animal hit. Additionally, if your car is stolen, Comprehensive will cover the cost of a rental (subject to a daily limit). Like Collision coverage, a deductible usually applies.
Collision and Comprehensive coverage each provide up to $1,000 of coverage for custom parts or equipment. Custom parts or equipment are accessories and enhancements permanently installed in or on your vehicle. Parts and equipment offered by the manufacturer or installed by the dealer at the point of sale are not custom parts or equipment, but are included under your standard Collision and Comprehensive coverage.
If you buy Rental Reimbursement coverage, we will reimburse you for rental car charges incurred while your vehicle is being repaired. You can only buy Rental Reimbursement coverage if you buy Collision and Comprehensive. Rental Reimbursement coverage is limited to 30 days and subject to the maximum per day amount shown on your Declarations Page.
Loan/Lease Payoff coverage helps protect you when your covered vehicle has been deemed a total loss and you owe a lender more money than the vehicle is worth. If you buy Loan/Lease Payoff and your vehicle is declared a total loss, Loan/Lease Payoff will pay the difference between the vehicle’s actual cash value and the amount you owe to the lender. However, the maximum we will pay under this coverage is 25 percent of the actual cash value.
Roadside Assistance coverage covers labor costs incurred at the place where your vehicle becomes disabled as a result of a mechanical/electrical breakdown, dead battery, flat tire, and/or lock-out. We will also help if you run out of gas or other fluid or become stuck in snow or mud within 100 feet of a road or highway. And, if necessary, Roadside Assistance will cover towing to the nearest qualified repair facility.

COMMERCIAL INSURANCE FAQ'S

A BOP typically covers three major items:

  • Property damage. Similar to a homeowner's insurance policy, this covers damage to your building (owned or leased), equipment, furnishings, fixtures, displays, and inventory.

  • Business interruption. If a covered loss strikes your store or warehouse, forcing you to stop operating for a period of time, your revenue stream is protected from lost business income. You can also choose optional protection that covers you in case a major supplier is affected.

  • Liability insurance for your business. Covers damages paid in judgments or settlements, and legal defense costs, if you are sued or held liable for accidental bodily injury or property damage arising from a covered cause
    • Businesses often need to carry more than one type of insurance, and your business' insurance needs may be highly individualized. A knowledgeable agent can help you find the right solutions. For some states, carrying insurance is a requirement. Requirements may also vary by the type of business you own and the number of employees; however, worker's compensation is required by law in most states, and highly recommended if not.

    In addition to the BOP, you may need other types of small business insurance coverage based on the kind of work you do, the size of your company and your location. These could include:

  • Professional liability insurance. This may be required as a separate policy, in addition to the BOP, to cover losses related to liability claims arising from mistakes or lapses of professional duties. Businesses offering professional services to their customers will often purchase this type of policy.

  • Commercial auto insurance. Company-owned vehicles will need to be insured through a commercial auto policy.

  • Health insurance. As a self-employed person, you may need to provide health insurance for yourself, your family and your employees.

  • Cyber insurance. Internet-based businesses or businesses that store their records online may need additional cyber protection against the risk of data breaches and malicious computer intrusions.

  • Commercial umbrella insurance. Provides liability coverage beyond the basic business insurance policy limits in the case of a catastrophic auto or business related event.

    • As your business expands, you may outgrow the standard Business Owners Policy and require more protection. It's a good idea to review your insurance coverage annually and determine if any additional policies would offer a more beneficial level of risk protection.

  • 1. Does my business need (EPLI) employment practices liability? If your business has employees then you are exposed for a loss related to employee practices. This isn’t just sexual harassment, it also includes unfair hiring/ firing practices, discrimination as well as unsafe work environment. Losses from a 3rd Party are also included.

    Did you know that If someone enters your business and harms your employee you can be sued by your employee? This is not covered under your general liability insurance.

  • 2. What is hired and non-owned auto liability insurance? Hired and non-owned auto liability insurance is a coverage found most often on business auto policies or the business owner policies (BOP). The coverage provides protection for the business in the event an employee gets into an at-fault auto accident while driving their own personal vehicle or any other vehicle not owned as well as a rented vehicle over the course of their workday.

    Example: You send your assistant out for stamps at the post office. She runs a red light which in turn causes bodily injury. If the business is sued, hired and non-owned auto insurance coverage responds.
    • This coverage pays compensation and other benefits required of the firm by the workers’ compensation law or occupational disease law of any state listed in the policy. The coverage applies to bodily injury by accident and by disease arising out of and in the course of an employee’s employment.

    CO-INSURANCE FAQ'S

    Many commercial property policies contain a coinsurance clause. This clause imposes a penalty when a policyholder suffers a partial loss and has failed to purchase an adequate limit of insurance.

    In property insurance, coinsurance is based on the concept of insurance to value,meaning the ratio of your limit of insurance to the value of your insured property. For example, suppose that you own a small office building. After consulting a building contractor, you estimate the replacement cost of your building to be $2 million. If you insure the building for that amount under a commercial property policy, your insurance to value ratio will be 100%. Alternatively, if you insure the building for $1.8 million, your insurance to value ratio will be 90%.

    Coinsurance clauses encourage businesses to buy adequate insurance. Most property insurance claims involve partial losses. If coinsurance clauses did not exist, many policyholders would try to save money on premiums by insuring their property for only a portion of its value. These policyholders would have insufficient insurance to cover large losses.

    A primary function of commercial property insurance is to protect businesses against catastrophic losses, such as the total destruction of a company-owned building. For many businesses, the loss of a building would be devastating. If the building isn't insured for its full value, the business might lack enough funds to reconstruct the building. This could impact the company's ability to survive.

    Co-insurance clauses encourage policyholders to insure their property at or near its full value. When most policyholders buy full limits of insurance, insurers collect more premium dollars and can charge lower rates overall. This helps ensure property ratesare equitable.

    Co-insurance works by imposing a penalty on policyholders that fail to purchase enough insurance to satisfy the coinsurance percentage shown in the declarations. The penalty applies to partial losses only. It is not relevant to total losses.

    The coinsurance clause will have no effect until you suffer a property loss. When the loss occurs, the insurer will compare the limit of insurance on your policy to the amount of insurance you are required to purchase based on the coinsurance percentage. If the ratio is less than 1, you will be subject to a penalty.

    In a commercial property policy, the coinsurance clause is typically found in the policy Conditions section. The fact that your policy contains such a clause does not mean that your policy is subject to coinsurance. Coinsurance applies only if a coinsurance percentage is shown in the policy declarations.

    Suppose that "80% coinsurance" appears in the declarations of your commercial property policy. The following example demonstrates what this means. You own a building that will cost $1 million to replace. Because the coinsurance percentage is 80, you must insure your building for at least $800,000 (80% of $1 million) to avoid a penalty. You want to save money on insurance premiums so you insure your building for only $700,000. Your policy has a $5000 deductible. A fire breaks out in your building and causes damage that costs $200,000 to repair. At the time of the loss, your limit of insurance was $700,000. To satisfy the 80% coinsurance requirement, you needed to purchase at least $800,000. The ratio of the amount you carried divided by the amount that was required (700,000 / 800,000) is .875. While your loss was $200,000, your insurer will pay you only $175,000 (200,000 X .875) minus the $5,000 deductible or $170,000. Your coinsurance penalty is $25,000.

    Ordinance or Law Coverage

    Coverage for loss caused by enforcement of ordinances or laws regulating construction and repair of damaged buildings. Older structures that are damaged may need upgraded electrical; heating, ventilating, and air-conditioning (HVAC); and plumbing units based on city codes. Many communities have a building ordinance(s) requiring that a building that has been damaged to a specified extent (typically 50 percent) must be demolished and rebuilt in accordance with current building codes rather than simply repaired. Unendorsed, standard commercial property insurance forms do not cover the loss of the undamaged portion of the building, the cost of demolishing that undamaged portion of the building, or the increased cost of rebuilding the entire structure in accordance with current building codes. However, coverage for these loss exposures is widely available by endorsement. Standard homeowners policies include a provision granting a limited amount of building ordinance coverage; this amount can be increased by endorsement. Also referred to as building ordinance coverage.

    Ordinance or Law coverage is available by an endorsement. It covers losses caused by building code enforcement if the building has suffered damage by a covered cause of loss, such as a fire.

    Ordinance or Law insurance consists of the three coverages described below. You may purchase any or all of them.

  • Coverage A: Loss of Undamaged Portion. Applies when one portion of a building has been damaged but the code requires demolition of the entire structure. Covers the loss in value of the undamaged portion of the building.
  • Coverage B: Demolition Costs. Covers the cost to demolish and clear the site of the undamaged parts of the building.
  • Coverage C: Increased Cost of Construction. Covers the cost to repair or reconstruct damaged portions of the building. Also covers the costs to reconstruct or remodel undamaged portions of that building, whether or not demolition is required.