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Steve Brooks Insurance Services eNewsletter
Phone: 800-915-3090 |
Safeguarding the interests of you and your family
April 2009 |
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Dear Friends,
It's April - the perfect time for spring cleaning! And while you're sorting and organizing, why not take stock of what you own? A home inventory will save you a lot of hassle in the event of a burglary or disaster. Go to www.knowyourstuff.org for details, or watch this video to see how Know Your Stuff works: www.youtube.com/watch?v=zIq6sUXIysE
Meanwhile, what is this recession doing to people? In these dire times, it's causing some to commit insurance fraud. From setting their own cars on fire to sudden missing jewelry, desperate folks are lying on insurance claims, a risky (and illegal) move to land some quick cash.
And finally, while a big fluffy bunny gave out Easter eggs, the California Department of Insurance served a lovable lizard with a stack of cease-and-desist documents. That's further proof that you can't trust those fictional characters with your insurance policies! We at Brooks Insurance Services are real-life agents who consistently make sure you are correctly protected.
With kind regards and thoughts of safety,
Steve M. Brooks, CIC, CPIA
Founder/President
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| Feathering the Nest? Update Your Insurance |
Consumers spend billions on their homes. Home improvement projects tallied to a whopping $280 billion in 2005, according to research from the Joint Center for Housing Studies at Harvard University.
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The center forecasts that home renovations will grow at a steady 3.7% rate annually through 2015, after inflation.
What shouldn't be lost in the excitement of adding a bedroom, finishing a backyard, or updating the kitchen, is your financial security. The risk management and insurance tools available through Brooks Insurance Services are indispensable when you're renovating.
Be aware that home renovations add to the risks you're facing as a homeowner, including injuries to family, contractors and delivery workers; fire, theft, and vandalism; and water damage.
What's more, know that you must protect yourself from financial liability for anything that goes wrong.
It's imperative that your homeowners and umbrella insurance coverages are set up correctly before, during and after your renovation project. The time and paperwork required may seem a distraction when you're eager to upgrade an older home, install an energy efficiency retrofit, or renovate a rental property. But it's every bit as important as buying the building materials or choosing the contractor.
Before renovations start:
Require contractors to provide proof of insurance for workers compensation and liability coverages. Brooks Insurance Services can guide you on how to do this and what to ask the contractor to provide.
Workers compensation insurance pays for medical and rehabilitation expenses (and covers lost wages) if workers are hurt on the job. Workers who are injured in your home can sue you or claim damages from you if the contractor they work for does not have adequate coverage.
If you need to move out during construction, notify your agent so you can be certain that you have proper coverage for a temporary residence such as a hotel or rented home.
During construction:
With the added risks-such as construction accidents, fires due to power tools and open utility lines, and strangers in the house who may be tempted to steal your property or your identity-you may want to consider temporarily increasing homeowners and/or umbrella policy limits and/or changing the deductible.
After the project is finished:
Home improvements can increase the market value and replacement cost of your home. Your agent can guide you to proper insurance coverage levels for homeowners and umbrella policies. At that time, you may want to also ask about guaranteed replacement cost coverage for your homeowners policy.
The renovated or expanded space in your home may fill up with new furniture, exercise equipment, electronics, and appliances. Track those purchases with receipts and a written or electronic home inventory. Additionally, check the coverage in your homeowners policy for personal property.
Talk to your agent at Brooks Insurance Services to be sure your home is properly insured at all stages of a home renovation project.
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| News Oddities |
Mom allegedly drives son, friends to car break-ins
GREAT FALLS, Mont. A 37-year-old woman was accused of driving her son and his friends around the city as the teens stole items from cars. Police
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learned about the case Saturday morning when the woman's husband called authorities to report he found a pile of stuff in his back yard that he suspected had been stolen. Court records said over $3,000 in items were stolen, including a set of golf clubs and power tools.
The woman was charged with accountability to theft and accountability to criminal trespass to a vehicle, along with endangering the welfare of children.
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Insurance Increasingly Important for Rock 'n' Roll Band Tours
The Irish mega-rock band U2 is slated to begin its latest series of concert dates, named the "360 |
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Tour", in Barcelona on June 30. The event has "created a storm of expectation among the band's fans," said Lloyd's. "Details of the band's mammoth globetrotting trek give a revealing insight into how music tours have changed dramatically in the past 20 or 30 years.
The tour, sponsored by handheld electronic-device maker Blackberry, will see U2 play 14 stadiums in Europe before rolling on to numerous dates in North America.
It may allow the band to reclaim its crown of the highest-grossing tour, lost to the Rolling Stones, whose 'A Bigger Bang' tour raked in an astonishing $558 million, shattering the previous record held by U2's Vertigo Tour, which made $389 million.
Lloyd's also notes that tours, such as U2's, "not only earn bands as much money as medium-sized companies," but also "have a similar sized workforce, employing a small army of technicians, crew, dancers, backing singers and musicians.
"The demand for insurance has gone through the roof because of the value of tours that now go on the road." The biggest claim he has dealt with was for $82 million, when a performer was forced to miss a number of concerts.
"With bands now signing '360 deals' worth tens of millions of dollars with a worldwide promoter, giving it rights to the band's performances recorded material and merchandise, all parties look to insurance to protect their investments," Lloyd's explained.
"Insurance is now prerequisite for touring," Taylor stressed, indicating that most of the business will make its way to Lloyd's, which is the acknowledged center for underwriting cancellation and non-appearance insurance for the music business.
Lloyd's also noted: "Though shows are no longer cancelled because an artist drove their Rolls-Royce into a swimming pool, performers can fall victim to bizarre events. Silcock cited a case where "on the eve of a tour the bass guitarist of a band shut his fingers in a car door and the tour had to be called off".
Even more bizarre was Taylor's recounting of a claim concerning a band's cancellation of a gig in a US city. The reason? The band didn't play cities that began with the letter M. "The lead singer said it came to him in a vision," says Taylor. Unfortunately, non-appearance insurance only covers circumstances outside the performer's control."
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Facebook Party Pics Lead to Eviction
A British landlady said she has evicted two tenants who posted pictures of the house being trashed during wild parties on Facebook. Carolyn |
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Lorimer, 26, said the tenants, a couple in their early 20s, fled the Folkestone, England, home after hearing of the eviction and left her with thousands of dollars worth of damage to the house and unpaid bills for rent and utilities, the Daily Mail reported Monday.
"When I logged on to Facebook and saw the pictures I was absolutely shocked," Lorimer said. "I recognized it as my flat straight away and I couldn't believe what I was seeing -- people jumping on the furniture, dancing on the kitchen table, holes in the walls and smashed TVs. It looked like a slum."
The landlady said the damage included holes in the walls and the destruction of a recently installed carpet. "It's the first flat I have ever let out and I never expected it to go wrong like this -- it's just been a total nightmare," she said.
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| Recession Increasing Insurance Fraud |
Does a bad economy increase crime? Analysts have debated that question for years, according to Mike McKee, senior special agent for the National Insurance Crime Bureau.
"The special agents at NICB have been seeing some effect from the current economic situation on insurance fraud," McKee said. Additionally, he said the recession is affecting fraud enforcement
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efforts in several ways. For example, the FBI is aligning a lot more investigators to look into actual economic fraud investigations versus insurance fraud investigations. All of the bank problems, mortgage fraud, things like that are detracting from the investigations of fraud."
The Coalition Against Insurance Fraud is seeing an uptick in different types of fraud such as auto give-up's and arson, said Howard Goldblatt, director of government affairs. "Fraud bureaus are telling us this, we're hearing it from the state fire marshals, and we're hearing about it anecdotally through news stories. It's clear that as the economy has gone down, the opportunity to commit fraud, to recover monies they think they need, has increased."
And with anywhere from $80 billion to $200 billion lost to fraud each year, affecting all lines of the insurance business - health, property, casualty, life and disability - it's no wonder that states are concerned with combating it.
Cashing in on Cars
Typically, insurance fraud is more prevalent in large, metropolitan areas. Large states such as California, Florida, New York and Texas also see more than a normal amount of fraud, McKee said. Yet across the nation, from Louisiana to California, insurance departments report they've seen an increase in vehicle give-up's, where the owner alleges that a vehicle theft has taken place, but in reality the owner has gotten rid of the vehicle.
"When the owner is involved, they'll often report the car stolen but actually take it out to the desert and set it on fire, then go back home and call the police, collect the insurance money, then pay off the car and make a profit," McKee said. "Here in California, we've got a lot of waterways where they drive it into the water and just sink the vehicle."
In some cases, with vehicle sales down and dealerships closing, another trend NICB sees occurring in Nevada and California is car dealership fraud. In this case, employees of car dealerships sometimes facilitate the theft and/or burning of vehicles to help the car owner pay off their old car and, in turn, have them purchase a new one from the dealership.
"CNN reported on March 17, 2009 that in the 4th quarter of 2008, 9 percent of all auto loans were one or more payments behind," McKee said.
In California, John Standish, bureau chief for the fraud division, southern region at the California Department of Insurance, said staged accident rings are increasing. Criminal rinks are finding it easier to recruit alleged victims for insurance scams because of people being in dire straits, needing money and not having the capability to function, he said.
Personal Assets
When people are in economic straits, they also try to unload other valuable assets, such as classic cars or jewelry. New Hampshire's Fraud Unit Director Barbara Richardson said her state's Insurance Division has seen tons of jewelry go lost or missing in recent months.
Cindy Schmell, fraud bureau chief for the Iowa Division of Insurance, said her department has seen an increase in arson of both vehicles and homes.
"Desperate consumers also are torching homes, seeking an insurance bailout from foreclosure or general financial distress," McKee added.
And, in California, he said the NICB has seen a "tremendous increase in alleged smoke and ash cleanup, where three to six months after the wildfires, people are coming in and saying, 'I had to spend thousands of dollars to cleanup my house for this ash and smoke.'"
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GEICO Charged by California DOI for Steering and Underpayment
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The California Department of Insurance (DOI) has charged GEICO with steering and underpayment in a "show cause" order. The insurance company now will be required to appear before the court, on a date to be determined, and show cause as to why the DOI should not order another cease-and-desist order against them.
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In 2007, California insurance commissioner Steve Poizner issued an order for GEICO to cease and desist unfair or deceptive acts or practices. He also required the company to submit a labor rate survey that would be compliant with the California Insurance Code (CIC) and the California Code of Regulations (CCR) and fined them $60,000.
The documents address the issue of steering and claim there were 10 instances in which GEICO required, suggested or recommended that the customer go to a preferred repair shop, which is in direct violation of Insurance Code section 758.5.
The documents also include several allegations involving a labor rate survey conducted by GEICO that was deemed non-compliant.
The commissioner is asking the courts to order a cease and desist for these new charges and for violating the previous 2007 order. Poizner also is requesting that there be a suspension of GEICO's certificate of authority for up to a year and a monetary penalty for each act mentioned in the documents.
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| Rumors of the Road - True or False? |
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TRUE or FALSE?
I left my wedding ring near the sink when washing my hands and it accidentally fell in and was washed down the drain. My homeowners insurance policy will cover the full replacement cost.
False.
Most homeowners policies do not include coverage for 'mysterious disappearance'. This can be solved by 'scheduling' or buying a rider for your jewelry. Once scheduled, then the jewelry is covered for 'all risk', and if it goes down the drain it would be covered!
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I'm now renting a home. The owner of the home (my landlord) has insurance to cover my personal belongings in case of a burglary, fire or flood.
False.
The owner of the property (landlord) has a policy that covers the home, but would not cover any of your property or personal belongings.By getting a very inexpensive Renters policy (sometimes as low as $10 a month) that would cover all of your belongings in case of fire, theft, vandalism. Also in case of the home being burned in a fire, the renters policy will pay for you to stay in a hotel and pay for your meals, as you don't have a kitchen to cook!
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I'm going out of town next week and will be renting a car. I can decline all the insurance they try to sell because I am fully covered from my own personal auto insurance policy.
True and False.
Your auto insurance policy does give you some coverage for the rental car, but rental car companies have very one-sided contracts.
If you crash one of their cars, your current auto insurance policy will most likely fix the car, but the rental car company can charge you for 'loss of rents'. If their car is in the shop for three weeks and they rent that car out for $39.95 a day, you might get a bill for $839 and loss of rents is not covered by your auto insurance policy.
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Steve Brooks Insurance Services, Inc. is a full service, Independent Insurance Agency, offering California Automotive Insurance, California Homeowners Insurance, as well as Renter, Condo and Earthquake coverage. We have access to the products and services of over 20 A+ Rated Insurance Companies.
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sent by: STEVE BROOKS INSURANCE SERVICES, Inc.
340 N. WESTLAKE BLVD SUITE 210
WESTLAKE VILLAGE, CA 91362
Phone: (800) 915-3090 Fax: (805) 496-4822
info@brooksins.com
www.brooksins.com
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