Insurance Archives | Kids Ain't Cheap

What Does Homeowners Insurance Look Like for a First Time Home Buyer?

February 13, 2020 | Leave a Comment

For many, insurance is a daunting topic. Understanding the types of coverage, terms and conditions of the policies, and balancing protection against value. Homeowners insurance intimidates many because it is comprehensive – covering both possessions and physical structure – along with providing protection against injury claims from accidents on your property.

Although it can be intimidating, one of the tips that we provide to first-time homebuyers is that they shop around for homeowners insurance policies before buying property, as many lenders require such policies. Even if it isn’t required, these policies are essential because a home is an investment that you can’t afford to lose.

Those things in mind, below are a few answers to the primary things that homeowner’s insurance entails.

What does homeowner’s insurance cover?

Most homeowner’s insurance policies cover your possessions within the property, and during travel. It also covers the primary residence and other structures on the property such as detached garages, sheds, and in-law units. The third core component of these policies is liability coverage to cover medical and legal costs associated with injuries on your property.

While most of these policies have broad coverage for events such as fire, explosions, hail, and theft, you need to pay close attention to the associated exclusions. For example, homeowner’s insurance policies often cover water damage from faulty plumbing, but coverage for natural floods requires a separate policy.

Other common exclusions include regional-specific issues such as mold, landslides, government action, nuclear hazards, and general wear and tear.

What are the most common homeowner’s insurance policies?

The primary types of homeowner’s policies on the market today include:

HO-2: A basic policy that covers specific problems such as fire, theft, riots, and other events/disasters that have clear definitions.
HO-3: A comprehensive policy that covers named and unnamed risks, except for specific exclusions set by the insurance company.
HO-5: A comprehensive policy that covers both the home and other structures on the property from loss, if it’s not due to what the insurance company excludes.

In addition to standard homeowner’s insurance coverage, you should also explore purchasing an umbrella policy. This coverage comes in handy if you have a claim that maxes out your standard policy. If your property has a swimming pool, for example, these policies can be invaluable

How much coverage do I need?

The amount of coverage carried by homeowners is determined on a case by case basis. Some homeowners only need minimal coverage, while others choose to purchase comprehensive policies. You should consider the value of your home, possessions, and the chances that someone would file an injury claim against you.

Another consideration for property coverage is whether to purchase “replacement cost” or “actual cash value” coverage. The former means the insurance company would pay the full cost to replace a damaged item (within limits) without accounting for depreciation. On the other hand, “actual cash value” accounts for depreciation, but it often is more affordable.

Insurance While Traveling Abroad

July 15, 2019 | Leave a Comment

You are all ready for your European vacation. You have packed your passport, clothing, snacks for the plane ride, and games for the kids. You may have forgotten something important, though. Did you remember to pack your insurance?

Before traveling outside of the United States, it is important to check your insurance policies to make sure you are covered for any unforeseen accidents or injuries.

Health Insurance

Nobody wants to get hurt or ill on vacation. Unfortunately, accidents do happen, and exposure to unfamiliar foods or environments can lead to illness. A trip to a foreign doctor, dentist, or hospital can be very expensive. Many health insurance policies, including Medicare, do not cover medical treatment outside of the United States. Make sure to check your insurance policy before you travel. If it does not cover you outside the country, consider purchasing a separate travel insurance policy that covers emergency medical treatment and medical evacuation so you can return home to recover after an accident.

Auto Insurance

Most automobile insurance policies cover policyholders as a driver or passenger in any automobile, even rental cars, within the United States. Some policies also cover travel to Mexico and Canada, but it is likely that you will not be covered in other countries. As any injury lawyer will tell you, even a minor accident can lead to significant liability claims. You may need to opt for the liability insurance coverage offered by the rental car agency if you are renting a car in a foreign country. To supplement that, look into a personal umbrella policy. Umbrella policies cover you for any losses over and above those covered by other insurance, so you may be able to opt for a less expensive option from the rental car agency if you have umbrella coverage. Always check with your insurance agent to make sure the umbrella policy covers you in the areas you are planning to travel.

Travel Insurance

Chances are, you have purchased non-refundable airline tickets, or placed non-refundable deposits on hotels for your trip. If an unexpected event delays your trip or forces you to cancel altogether, a travel insurance policy can reimburse you for those losses. Travel insurance policies may also cover lost luggage, meals, travel inconvenience if you miss part, but not all, of your trip, and may also cover emergency medical treatment. Most travel insurance policies are relatively inexpensive, but can save you thousands of dollars. Just make sure you do some research and choose a reputable insurer. Read the policy benefits and limitations before you purchase so you understand exactly what you are getting before you have to make a claim.

Pay More Attention to Your Credit Score Following Equifax Breach

September 9, 2017 | 1 Comment

Credit scores have gotten more attention this week thanks to the news of a data breach at Equifax potentially impacting about 44% of the U.S. population. To rein in the damage from this incident, Equifax is offering a free notification service that is essentially a complimentary credit monitoring tool.

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Major Illness/Injury: How to Protect Your Finances…

January 17, 2014 | Leave a Comment

In the past six months, my dad has had an emergency quadruple bypass and an 11.5 hour operation to repair an abdominal aortic aneurysm (look it up on Google – you’ll be shocked that he survived). Needless to say, he’s also been out of work for just about all of that time. However, they’ve managed to survive financially. Could you?

Guaranteeing A Stream of Income

By now I think the duck who touts the importance of short-term disability insurance is basically a pop culture icon. You’ve probably heard him quack away about how this insurance gives you a stream of income to pay everything from medical bills to household expenses. This is the most critical reason why my parents have been able to weather the proverbial storm as my dad has recovered from two major surgeries in such a short period.

A few years ago, my dad’s employer offered company-sponsored short-term disability insurance through another major provider. My dad’s company would pay 60 percent of the annual premiums, leaving my dad with just a $100 tab. My dad never used it, until some routine screening found major blockages in the arteries around his heart. He was out of work for eight weeks, but because of this insurance, he was paid about 55 percent of his typical weekly salary, giving him and my mother more than enough cash to pay the bills. When he had the aneurysm surgery a month later and was out of work for 12 weeks, he was once again sent weekly checks thanks to the policy.

Re-Arranging Your Mortgage

My parents paid off their home loan years ago, but for many individuals who find themselves temporarily out of work, this is the single biggest financial obstacle they encounter.

However, there are ways to lessen this burden. If you can prove that your financial hardship will only be temporary – six months or less, typically – then your lender may allow you to take out a forbearance. This essentially suspends your mortgage payments for six to twelve months while you’re out of work; once you’re back on your feet – and back at work – you’ll have another six to twelve months to repay the principal and the interest you skipped.

Some people may turn to refinancing an existing home loan instead. Using a mortgage calculator can show you how this can reduce your monthly payments, but beware: refinancing also comes with closing costs that may temporarily increase your out-of-pocket expenses before you’ll see a real return on your investment. Play around with a home loan calculator to see whether or not this move could pay off for you.

Taking Out A Personal Loan

If you have to, you may need to take out personal loans or payday loans from a company like LendGreen. This can be a quick way to get the cash you need to pay your medical bills while you’re waiting for insurance to kick in. Remember, claims can sometimes take 8 weeks or longer to be processed, and if you have to pay for things up front, you may need some quick cash.

Asking For Help

When I was working in TV news, I once covered a story about a mother of three with terminal cancer. When her short-term disability coverage ran out – most policies will only let you collect benefits for a few months at a time – her coworkers stepped up to the plate, donating their sick time and vacation days on her behalf so she wouldn’t have to worry about paying the bills in her final weeks. Sometimes, asking your boss or coworkers for help can mean the difference between financial hardship and security.

What have you done to protect your finances from a major disruption in income?

Revisit Your Insurance in the New Year

January 11, 2014 | Leave a Comment

The New Year is a great time to revisit all aspects of your personal finances. However, after budgets and investments, a lot of people forget to re-evaluate their insurance needs.

Not only could your needs have changed, but by shopping around for insurance, you could get a better rate and possibly save some money. Here’s some simple things that you should look for in the New Year.

Home Insurance

Have you moved lately? Have you bought new stuff for the house,mor maybe remodeled? If any of these situations apply, it’s important to remember that your home insurance needs could have changed. You may need to look at increasing the value of coverage, or even adding more personal property.

The worse thing that you can do is be under-insured, and that can happen easily if you don’t make sure that your policy keeps pace with the improvements you make to your home. Just imagine installing a brand new wood deck, having a BBQ accident, and not having enough insurance coverage to have it replaced. That’s not a good thing, and you’ll regret it later.

Auto Insurance

Auto insurance is one of those insurance types where it pays to shop around. The sad thing is that your insurance company typically locks you in at a set amount, regardless of changes that happen in the industry. I recommend calling around to several different companies, or getting quotes online, so that you can really see if you’re still getting the best rate possible.

Plus, if you’ve moved at all, simple changes like your zip code can make a difference in the rate you’ll pay to insure your car.

Personal Property Insurance

Did you get a pretty, shiny diamond for Christmas? Well, if you did, you’re extremely lucky, but you should also consider getting a personal property policy to cover your jewelry. Typically, most home insurance policies don’t cover jewelry, and so you have to purchase an additional policy that just covers the jewelry. They aren’t expensive, but they can help you with the piece of mind that will make you comfortable wearing your new ring or necklace as much as possible.

What other insurance moves do you think people need to make in the New Year?

Life Insurance: A Must Have for New Parents

November 4, 2013 | 2 Comments

If you’re planning to have a baby soon, you may be overwhelmed by the expenses you’re facing. All that new baby gear costs quite a pretty penny! There are so many must-haves: a crib, changing table, bouncy seat, baby tub, just to name a few. Marketers would like you to believe that this is just the beginning of the items you’ll need for the baby.

Don’t forget other necessities like diapers, wipes, formula.

Whew. Are you getting nervous yet?

While you may resign yourself to paying for these items, one important item you may not even consider is life insurance.

If you don’t have life insurance yet, you’ll want to get a policy as soon as the baby is born. Hopefully you’ll live a nice, long life, but if you don’t, you want to leave money so that your spouse or another caregiver can afford to raise your child.

Why Life Insurance Through Your Employer Shouldn’t Be Your Only Policy

You could get a fairly low cost policy through your employer, but this is a risky strategy. Remember, if you leave this job, you’ll forfeit the company’s life insurance policy. While that makes little difference if you’re healthy, if you develop a health condition before you leave your job, you’ll be hard pressed to find an insurer that will issue you a life insurance policy for a premium you can afford.

You could take out employer-based life insurance as a supplemental policy, but it shouldn’t be your only policy.

How to Reduce the Cost of Private Life Insurance

It’s far better to get your own private health insurance.

I know, you may think that is one more expense that you really can’t afford, but the simple truth is that you cannot NOT afford a life insurance policy.

The good news, though, is that if you’re healthy, you’ll likely find that a private life insurance policy is not as pricey as you think. Our friend Jeff Rose has some great tips on how to get the best rates on life insurance.

There are other strategies, too. If you’re overweight when you initially get your policy but you lose weight and get into a healthy weight range, your premium might be adjusted to cost you less (because the insurer’s risk is lower). Usually, you need to maintain this weight loss for at least a year and also have a doctor’s notice that you’ve maintained the weight loss for that duration.

The same consideration might be given to a smoker who has become a non-smoker.

Finally, remember that shopping around for the lowest policy is an excellent way to reduce costs. You’ll likely be surprised how much the same insurance policy’s premium can vary from company to company.

While you likely don’t want to think about life insurance, if you’re having a baby, you must protect yourself and your child with a good life insurance policy.

Do you have life insurance to protect your family?

Funeral Insurance is More Important than You May Think

April 3, 2013 | 1 Comment

Throughout all of life’s ups and downs, there are a few things you can be certain of:

You will have to pay taxes
You will endure many changes and seasons of change as you grow older
You will eventually pass away

While death is certainly a sensitive topic to most, careful consideration should be taken to ensure your final days are spent filled with love, family and friends instead of accountants, bills and funeral directors.

With a bit of pre-planning, you can make sure all of your final arrangements are taken care of long before those emotional last hours. You can also rest peacefully knowing that your loved ones won’t be left with any financial burden by purchasing funeral insurance.

What is Funeral Insurance?

Also known as burial or final expense insurance, funeral insurance is a type of life insurance policy that covers the costs associated with your end of life arrangements. These can include everything from caskets and funeral home costs to flowers and burial plots in the cemetery.

Policies typically range in value from $5,000 to $50,000 and are left in the control of a designated beneficiary who will organize, and pay for, your final arrangements as you specify.

Tips for Buying Funeral Insurance

First and foremost, don’t purchase a policy that’s unnecessary. This may be the case if your current life insurance policy covers funeral expenses (or perhaps you already have money saved for these costs). Once you’ve identified that funeral insurance is a purchase you’d like to make, check the laws in your state and city, discuss your plans with your family, and research a few different brokerages and coverage options before committing to one.

You should also set up a meeting with a funeral director at the home you plan to have your final arrangements carried out. Also, make sure to take advantage of the “free look” period (the first 30-60 days of your policy) so you’re 100% confident this is the policy you need and like. If there’s something wrong or you’ve changed your mind, you can legally cancel the policy and get your money back!

When it’s Time to Buy

The first step of the buying process should be to have everything put into writing. Ensure that your wishes are clearly stated and the various components of your arrangements are clearly listed in the contracts. Finally, make sure all documents are signed in your presence!

Do you have funeral insurance?

Does Insurance Cover Infertility Treatments and IVF?

December 7, 2012 | 1 Comment

If you’re reading this article, chances are you’ve been struggling with infertility for a while. This is such a tough situation to be in, because you know that all of the next steps (no matter how small or big they may be) are going to be hard emotionally, and have the potential to be very expensive, from human egg freezing to IVF. However, what many people don’t realize is that, in many cases, some types of infertility treatments are covered by insurance. This can be a huge benefit to an otherwise dreary situation.

Diagnosis and Treatment of Underlying Condition

This is the phrase that you’ll here the most: Your insurance covers the diagnosis and treatment of the underlying condition of infertility. But the real question is what does this mean when you actually get to see a specialist?

This clause usually means that you get the following covered for the woman (based on your normal plan deductibles):

Exams
Blood Tests
Radiology Tests
Prescription Drugs
Possible Treatments Relating to Infertility (i.e. blocked tubes)

What Insurance Doesn’t Cover

That sounds like it covers a lot of things, and it does. It also covers a lot of the more expensive aspects of treatment, including radiology tests and prescription drugs (like Clomid). However, insurance also doesn’t cover a lot of things when it comes to infertility as well.

For example, it doesn’t cover anything related to the male reproductive system (unless the male is covered under an insurance policy that also has a diagnosis and treatment of underlying condition clause). Some common things that applies to this are:

Blood tests he needs
Sperm Analysis
Hormone treatments or other prescription drugs

It also doesn’t cover anything related to actually getting you pregnant. This means, the following typically aren’t covered:

Insemination
In vitro fertilization (IVF)

The Bottom Line

The bottom line is that if you are going to see a reproductive endocrinologist or other specialist, make sure that you check and see what your insurance company covers before going. You may be surprised to find out that a lot of it will be covered.

Plus, if you have a condition like PCOS (Poly-cystic ovarian syndrom), and everything else is functioning normally, taking a round of clomid and having intercourse normally may be all you need to get pregnant. This also won’t cost you very much beyond your visit copays.

However, if you are going to need much more extensive help, like IVF or even using a surrogate, it can be a large expense. In this case, you should consult with a financial planner or other advisor that can help. Many of the top fertility centers also offer financial guidance if you are in these situations.

What are your thoughts on the cost of care for IVF or other reproductive procedures?

Get Your Kids Covered

February 28, 2012 | Leave a Comment

This guest post was provided by Lynette Argent of Million Dollar Woman, a life insurance company which provide insurance products catered specifically towards the needs of women and their families.

Insurance policies cover those unexpected moments in life. It is the assurance of being taken care of when ill, having the necessary health checks and treatment covered. It could also mean assured financial security in the event of a serious illness or death.

While most adults are keen on finding the best insurance for themselves, they may not be aware they can insure their children as well. Obviously we don’t want to think of the morbid thoughts of a child being ill or passing away but insurance is important for our children and should be considered by every parent. Since our children are so highly treasured, wouldn’t it make sense to get them covered as well?

Accidents Happen

Every parent wishes to see their children develop into healthy and happy adults but we could not always be there with our children, protecting them 24 hours a day, 7 days a week. Unforeseen things do come about and as a parent it is good to be prepared for these kinds of events even though they may never take place.

Injury and Illness

We all wish to keep our children out of harm’s way but at times a misfortune may occur which may result in child’s injury or illness. Getting hold of insurance for your child would ensure that if something were to happen you could be better prepared financially.

Getting your hands on an insurance policy for your children could seem like a complicated task. It is often much similar to acquiring your personal insurance, but with a little more detail involved. When looking for an insurance plan for your children, it is imperative to get more than a few quotes with the intention of price comparison and having the idea of what each company offers.

The importance of insurance for a young child may seem incomprehensible at this moment and the need for it unimaginable, but having some sort of insurance for your precious one may well be the wisest investment you make.

Do you have insurance for your children?