Is Landlord Insurance Needed if You Rent Out Your Home?

So you’ve decided to rent out your home. Perhaps you’re moving to a bigger place or taking an extended trip. Whatever the reason for your decision, should you get landlord insurance?

What is landlord insurance?

Sure, homeowners insurance will cover you if your house burns down or if there’s a break-in, but it might not cover you for damage incurred while renting your home to someone else. Landlord insurance covers exactly that, including the house itself, sheds or other structures and the owner’s possessions, but not the tenant’s possessions. It also covers lost rental income if the house is damaged and uninhabitable, and, in the case of a lawsuit or injury, there is some liability protection for the owner. There are also specific policies, such as a dwelling fire policy or special perils policy, that cover you in the event of fire, storms or ice damage.

What’s the risk in renting out your home?

Homeowners insurance covers an owner-occupied single-family residence. If this doesn’t sound like your current situation, you’re probably not covered. The reason is it’s a much higher risk for the insurance company. Insurance companies experience more claims on tenant-occupied property as opposed to owner occupied. Your risk also rises as you are now responsible for any damage done to the property by a third party.

Will I pay more?

Yes, expect to pay 15-20% more than your current homeowners policy. This cost is even higher if you’re only renting out your property short-term. However, the risks are higher, so the cost becomes worth it.

If you’re about to start renting out your home and still not sure if you need landlord insurance, call or email us. We can walk you through the process and find the best policy for you and your specific circumstances.

Protect Your Home with These 6 Wildfire Prevention Tips

A spark is all it takes for your home to go up in flames and all your belongings with it. A wooden deck or porch can make it even more likely, especially during those summer months. How can you make your home less likely to catch fire? Here are some wildfire protection tips.

Check your smoke and carbon monoxide detectors

Do this often, and make sure they work. It can be the difference between life and death.

Get fire extinguishers

And make sure you check them regularly.

Clear the yard of debris

Fallen leaves, dead wood, or parts from a broken jungle gym are all kindling to a fire already raging. If a fire threat is imminent, move the outside furniture somewhere where it can’t ignite, and make sure you remember to move the welcome mat, too.

Remove tree branches lower than six feet

Don’t plant bushes directly beneath trees. This is literally adding fuel for the fire to reach higher.

Use non-flammable fencing

It’s worth investing in a fire-retardant fence if you live in a fire threat area.

Make sure your insurance policy is up to date

Even if you take all the necessary precautions, a fire can still do a lot of damage to your home. Make sure your insurance policies are up to date and include damage from fire.

If you live in a fire hazard area and are wondering if your insurance acknowledges this, get in touch. We will be happy to talk to you about your policy.

Do Your Loved Ones Know about Your Life Insurance?

The purpose of life insurance is to provide for your loved ones after you have passed on, but for that to happen, your loved ones need to know about the insurance.

It seems obvious, but some people do not communicate about their policies to their loved ones: what companies their insurance policies are with, what those policies cover and who to contact in case of an untimely death. And if your beneficiaries do not know a policy exists, they cannot obtain the money you intend them to have.

The problem is so significant some states have looked into measures to prevent life insurance from being forgotten. For example, some states may require life insurance companies to pay the beneficiaries of policies that are no longer active if they are dated after a certain year.

But not all states have such requirements, and life insurance companies, while they try to contact your beneficiaries, do not take extreme measures (such as hiring private investigators) to track down your beneficiaries if they cannot easily find them.

Imagine if your beneficiaries found themselves in this situation. Perhaps they moved to another state, or perhaps they changed phone numbers, and after your death, they could not be found. The money you intended them to have (money that could make a big difference in their lives, whatever the sum) could not get to them. Your efforts in buying life insurance would have proven fruitless.

So talk to your loved ones today. Let them know you have life insurance and that they are the beneficiaries and what to do in the event of your death. They should know the name of the insurance company, the amount of the policy and ideally even the policy number.

If you decide you need life insurance, talk to us. Call or email us and we can discuss your options.

Group Health Benefits for Your 1099 Contractors

As many of us struggle to find the right people to add to our professional teams, benefits continue to be at the top of the list for prospects. Health insurance is a key benefit that everyone is searching for. Can you extend these benefits to your 1099 contractors?

What is the difference between 1099 contractors and W-2 employees? A 1099 contractor is defined by the IRS as self-employed. Many states do not require businesses to offer health insurance to non-employees. With a W-2 employee, the employer has more control over the scheduling and work output of their employees. W-2 employees also have their wages and taxes paid communicated to Social Security by their employer.

Why should I offer 1099 contractors health benefits? Most employers contribute to their employees’ healthcare premiums as a benefit. A 1099 contractor may not want to claim this benefit, since it is considered taxable income. An advantage of offering benefits and contributing to the benefits you offer may allow your business to qualify for coverage. This may also reduce the healthcare premium of your existing plan due to the increase in the number of eligible participants. Offering benefits can make for a happier and healthier workforce.

What do I need to qualify for a group plan? A small group has between two and 50 employees, including the owners. You will need to prove you are a legitimate business. This is easily accomplished by having a business license or articles of incorporation. When considering how many individuals will be affected, it is important to know that when you offer insurance, you need to offer it to everyone you determine to be qualified. If working 30 hours a week qualifies someone, then anyone who works 30 hours a week needs to be offered coverage.

We are a phone call away when reviewing your 1099 contractors and have questions about adding them to your group health benefits.

Did You Know These 4 Facts about Medicare?

Do you receive calls or sales material because you are turning 65 soon? Are your friends trying to educate you on Medicare, but everyone tells you something different? Here are four things you should know about Medicare.

There are two parts of Medicare. Part A is hospital insurance. Part B is medical insurance. When you have Part A and Part B, you are considered enrolled in Original Medicare.

Medicare is free. Typically, you do not pay a monthly premium for Part A, based on contributions you or your spouse made to Medicare while working. However, there is a cost for Part B. Most people will pay the minimum monthly amount of $170.10 for 2022. Some will pay more, and this is referred to as an Income Related Monthly Adjustment Amount (IRMMA).

What are my Medicare options? You have several choices. You may retain your original Medicare and add Part D drug coverage and/or also add a supplemental medigap policy. Your other option is to select a Part C Medicare Advantage plan, which bundles your Part A, Part B and, in most cases, Part D, too.

What if I am still working? If you are continuing to work beyond age 65, you are not required to enroll in Medicare during your initial enrollment period of seven months. When you are ready to retire and lose active employment group coverage, you will have a special enrollment period to enroll in Medicare at that time.

We are here to help you navigate the ins and outs of Medicare. Call or email us today and we can find what is best for you.

Business Income Insurance and Why You Need It

Business income insurance, which is also known as business interruption insurance, is a type of coverage that replaces the income you lose if your company is unable to operate as usual.

What does a business income policy cover?

This type of insurance covers lost income while you are recovering from a covered loss, such as a fire or theft. For example, it might be used to cover mortgage or rent, supplies, payroll, loan payments or tax payments during a restoration period, which is the period when your business is shut down due to physical damages. Covering your lost income until you can reopen again can help you continue to pay your operating expenses.

Business income insurance exclusions

Business income insurance doesn’t cover damages to physical property; it pays for your loss of income when you are repairing or replacing damaged property. That’s a fine distinction, but it’s important. You will need another type of coverage to pay for the damaged property itself.

Additionally, business income insurance may not cover income losses incurred during certain extreme events or “acts of God,” such as pandemics. That might not have concerned you several years ago, but we all know why it should now.

Who needs business income insurance?

Business income insurance is important in a number of circumstances. Almost all businesses (except those that are home based) pay rent or mortgages. If you’re a manufacturer, you likely have rental payments for heavy equipment, such as forklifts. If you’re a retail clothing company, you likely have inventory. If you’re a software company, you may rely on computers, servers and cloud storage. And in all cases, you may have employees who need to be paid.

How does business income insurance work?

To ensure your coverage is comprehensive, most insurers offer a broad range of insurance options and so-called extensions or riders, which are intended for those with unusual circumstances.

How unusual? Say your storefront is the site of a serious crime and authorities shut it down while they investigate. A “civil authority” extension or rider might provide you with lost income during the time you are not allowed to access your business.

You might also be able to obtain a rider that will let you continue operations when employees are unexpectedly absent—not because of run-of-the-mill accidents or illnesses but due to extreme circumstances.

Or if you rely on cloud-based storage to maintain data or transfer important files to vendors, clients and employees, a special type of coverage can reimburse you for income due to an unexpected outage of your cloud service.

You can even get coverage that helps cover lost income and additional expenses that result from an interruption in utility services, including power, communications, and water services.

How can you get business income insurance coverage?

Business income coverage may be included in another type of policy, or you can purchase it on its own. You can also add a variety of optional coverages, as detailed above. But the best way to find the right coverage is to discuss your specific needs with us so you can get coverage tailored to your circumstances. To get started, please call or email us today.

The Basics of Business Owner Insurance Policies

A business owner’s policy (BOP) combines two types of insurance (property and general liability) into one policy, helping you efficiently manage claims resulting from disasters, theft, fires, bodily injury and more.

Who needs a BOP?

A BOP can help your business if you have a physical location, regardless of the type (a home, a rented or owned office, a storefront or even a garage), because those locations are subject to damage.

A BOP can also help your business if you have assets that could get stolen or damaged. These can include physical assets, such as equipment, furniture and inventory. But they can also include digital assets. If someone steals or loses customer data, for example, a BOP can help pay expenses involved in notifying clients.

You could also benefit from a BOP if there is any chance that you could be sued. Say a customer slips and falls in your retail storefront or office. Without the proper coverage, you could face significant medical expenses.

Why consider a BOP?

A BOP is more affordable than buying separate business property and liability policies. You can also tailor a BOP to help meet your business’s specialized needs by adding optional coverages, such as data breaches and business income loss. A BOP policy can also be customized to certain industries.

How can you get a BOP?

Proper insurance coverage is an important part of being prepared. Call or email us today to review your policies and determine if a BOP is a good fit for you.