Rescission – meaning your insurance carrier “rescinds” your insurance contract or terminates it as if it never existed – is serious for any business owner. While rare, a rescission means an insurance carrier is not obligated to pay your claim, even if it would normally be covered under your policy.
Insurance companies have the right to terminate a policy if the insured conceals, misrepresents or deceives the carrier during the application process. This can occur in many types of coverage, from health coverage to fidelity protection.
To prevent rescission, your coverage application must be accurate. Your ethical duty when applying for coverage is to disclose to your insurer all “material facts”, that is any circumstances that might make an underwriter hesitate or refuse to write your business.
For example, if an employee steals from petty cash but subsequently repays you, you may be satisfied to let the matter drop. However, when you later apply for fidelity coverage, you must disclose this; failure to do so may invalidate your coverage for any future theft committed by this employee. In rescission cases, the court will look at what you as the policyholder knew when you applied and whether you acted in good faith.
Rescissions are not a common occurrence, but what business owner can afford an uncovered loss? As you complete your policy applications, bear in mind that honesty is always the best policy. Armed with all the facts, your insurance advisor will be able to find the policy that’s right for you.
Today’s long-term care insurance policies are more flexible than the plans of several years ago. In the past, most long-term care plans only paid for services received in a skilled nursing facility, and benefit triggers were much more stringent.
The long-term care insurance plans of today cover a wider range of services. For example, many policyholders are now covered for care received in assisted living facilities and their own homes as well as in skilled nursing facilities.
In putting together the long-term care insurance policy that is best suited to your needs, you have a number of options to choose from, including:
Length of Coverage
You can choose the duration of coverage – the number of years you wish to be covered under the policy – including a lifetime option covering you for the remainder of your life, providing you continue to meet the criteria necessary to qualify.
Amount of Coverage
Typically you can choose the actual dollar amounts of daily or monthly benefits you wish to receive.
A long-term care policy’s elimination period works like a deductible in other types of insurance; you can choose the number of days that you pay out of pocket for your care until the policy benefits start. Depending on the policy, this can range from a low of 0 days to a high of 365 days.
You can also choose to add inflation coverage. With this option, the benefit amount will increase by a certain percentage each year in order to help keep up with inflation.
The flexibility of today’s long-term care insurance policies means that you now are able to pick and choose from options that weren’t available in the past. It’s important to work with your insurance professional in order to tailor those options to most closely meet your care expectations when the need arises.
The definition of an asset is “a useful or valuable quality, person or thing.” Many people, when asked what they consider their most important asset, cite their homes or their savings. However, while these are certainly high priorities, the fact is that everyone’s key asset is the ability to earn an income. Without it, you likely wouldn’t have a home or savings.
It is essential to protect that asset with disability insurance. Disability insurance is designed to replace some or all of your income if you become disabled and unable to work due to illness or injury, as covered by the policy. A disability insurance policy usually provides benefits in monthly increments, so you are able to pay your regular living expenses and maintain your standard of living.
There are many variables involved in a disability insurance plan, but the key components consist of the following: the amount of income to be paid when a triggering event occurs, how long those payments will continue and how long you must wait for the benefits to start after the triggering event happens.
When you purchase an individual disability insurance policy, the premiums are typically paid out of pocket with after-tax dollars. Discuss with your insurance professional the tax ramifications of this; it is likely your benefits will be tax free.
Unquestionably, your ability to earn an income is of vital importance. Ensure that you protect this vital asset with disability insurance but also be careful to select the plan that will work for you. Insurance professionals can help.
Many people who formerly owned or rented are moving in with relatives to save costs in this troubled economy. This means many rental properties and single-family homes are sitting vacant and awaiting sale or foreclosure.
If you own a property that is vacant, is your insurance coverage adequate? Vacant houses have higher risks of vandalism, arson and other losses; if a property is unoccupied for a certain length of time, usually 30 to 60 days, your insurance coverage may cease or offer only limited coverage in the event of a loss.
To determine if you should update your insurance information with your agent, ask yourself these questions:
Is your homeowner’s insurance still working for you?
Here are some things to consider before you purchase or renew your homeowner’s coverage.
If your home is a total loss, do you have enough coverage to rebuild? The majority of property claims result from partial damage to a home. If your home is completely destroyed, you want to have enough coverage to totally rebuild it.
Homeowner’s policies limit personal property coverage. Homeowner’s policies place limits on many types of personal property. If you have valuable guns, jewelry, watercraft and trailers, or computers, consider purchasing additional coverage.
Does your policy provide replacement cost coverage? Personal property is valued at replacement cost or at actual cash value. Replacement cost replaces your old damaged or stolen items with new at no extra cost to you. Actual cash value considers the age and condition of the item. Replacement cost coverage doesn’t increase your premiums by much but provides better coverage.
Are my children’s possessions covered while they are away at college? Your homeowner’s policy may provide limited coverage for your college student while he or she is living on campus; however, once your child rents an apartment in his or her own name, consider purchasing a tenant homeowner’s policy.
Do you work at home? Your policy may only provide limited coverage for equipment provided by your employer so you can work at home. Additionally, if customers or business associates come to your home on business, you may want additional coverage for this.
Is my boat covered? It depends. A small boat like a kayak should be covered under your policy, but for a larger boat you may need extra property and liability coverage through a boat policy.
Each company’s coverage differs slightly so it’s important you consult an insurance professional to be sure you get just the right policy for your own circumstances.