Flood Insurance

 


Headlines from August 2021
  •        Record Rainfall Causes Flash Floods in Flagstaff Burn Areas, Arizona
  •        98 Rescued, 35 Missing in North Carolina Floods After Rain From Tropical Storm ‘Fred’
  •        State of Emergency After Flash Floods in Steuben County, New York
  •        More Deaths Reported Following North Carolina Floods
  •        10 Dead, More Missing After Record Rainfall and Catastrophic Floods in Tennessee
  •        Death Toll Rises in Tennessee Floods, Over 20 Still Missing

Many of these areas had never seen flooding before, or at least, not flooding to this level. Both global climate change and population expansion are combining to flood (pun intended) the news with reports of lives lost and property destroyed by rising waters.

For decades, all flood insurance policies were written by the federal National Flood Insurance Program (NFIP). A change in 2021 allows private insurance companies to now offer a second option that may provide the same insurance at a lower cost for many homeowners.

Before calling your local agent, though, understand some of the key differences between private and NFIP coverage. For one thing, where the NFIP guarantees renewal of its policies, a private insurer has the right to decide not to renew a policy, or outright cancel it. As private flood insurance represents new products, there’s uncertainty about what policies might cost in the future and which companies may still be writing them.

National Flood Insurance

The NFIP, established by the federal government in the 1960s, was intended to provide flood insurance and to establish floodplain standards for the country. The 1960s was a time of expanding suburbs and settlement of exurbs, with folks choosing to raise their families outside the city.

Many of those areas, were in flood plains, with a history of 100 year flooding. Meaning, once in 100 years, the flood plain would again flood as heavy rains and storms caused rivers and stream to rise above their banks.

Around 90% of residential flood insurance in the U.S. is provided by the NFIP. 

Federal flood insurance includes two coverage types, each with their own separate out-of-pocket deductible.

  • Building property coverage: Pays to repair flood damage to your home or garage. Maximum building coverage limits for residential property is $250,000, which was more than needed in the 1960s, but with today’s real estate market, may not be enough to fully repair damage caused by flooding. 
  • Personal property coverage: Pays to repair or replace flood damaged furniture, electronics, appliances, and other personal property. The maximum personal property coverage limit is $100,000. 

Prior to July 1, 2019, if your mortgage was federally backed and you lived in a high-risk flood zone, the mortgage company could require flood insurance purchased exclusively through the NFIP. As of July 1, 2019, mortgage lenders were required to accept private flood insurance, as long as the policy had at a minimum of the same quality coverage as provided by NFIP.

Standard homeowner’s insurance policy does cover certain types of water damage, but will not cover damage from natural flooding, which is why mortgage lenders often require separate flood insurance for homes in special flood hazard areas. And now, coverage may be available on the private market.

While private flood insurance makes up a tiny fraction of the market, it’s becoming an increasingly popular, and occasionally cheaper, alternative to the NFIP. Private flood insurance tends to have a wider array of coverage options and higher limits of protection than the NFIP plan. 

NFIP vs Private Insurance

Coverage Differences

A significant difference between NFIP and private insurance is coverage options.

The NFIP maximum building coverage limit is $250,000. Private carriers can offer up to $1 million in coverage, with some companies offering higher limits. As the replacement cost for houses continues to increase, it may be worth purchasing that additional coverage.

Private flood companies also offer coverage not available through NFIP. Replacement cost under NFIP is only offered for primary residences. Other property types and contents are only covered at actual cash value. Private flood carriers can offer the option to add replacement cost coverage for both contents and secondary residences. 

Other optional coverages available only through private flood are:

  • Additional living expenses – coverage for temporary housing while the primary residence is under repair and restoration
  • Pool repair and fill – covers damage to the pool itself, as well as filtering equipment
  • Business income coverage – lost income while recovering from damage
  • Enhanced coverage for detached structures – for example, garages, offices, carriage houses

Waiting Periods

Another major difference between NFIP and private is the policy waiting period.

NFIP has a mandatory 30-day waiting period from the date of payment to the date coverage begins, with exceptions for loan closing requirements. However, the maximum private flood policy waiting period is only 15 days. And some companies allow coverage to go into effect immediately. 

Final Consideration 

With the rising number of flood emergencies, (six in August of last year alone affecting the entire country from California to Alabama, Georgia, Virginia, and Rhode Island), flood insurance helps protect your property.

The NFIP is required to be reauthorized by the government every so often (the most recent reauthorization was extended to February 18 of this year). If the NFIP were to expire, no policies through the program could be written or renewed, leaving private carriers as the only option.

As private flood carriers do not have to follow FEMA regulations, coverage rates can fluctuate. As there are multiple carriers, there is the option to shop coverage with multiple companies. Competition is always in the best interests of the consumer.

Aspen Insurance Agency is a family-run business in Denver, Colorado servicing clients nationwide. We work with multiple insurance carriers to offer our customers a wide variety of risk reduction coverage at the lowest possible cost. We offer a wide range of personal, auto insurance, commercial and professional insurance to residential and commercial insurance customers enabling the cheapest rates available. Call to speak to one of our professionals for home or business insurance and see how painless insurance shopping can be.

Social Media Privacy

It is no secret how pervasive social media has become in our society. Facebook, Instagram, Twitter, Linkedin, TikTok all worm their way into our day-to-day consciousness demanding we post text and pictures describing our current exploits. Even something as mundane as last night’s dinner or someone else’s cute kitten at play must be posted, shared, and commented upon (and hopefully, “liked”).

However, our social posting addiction has a potentially negative side effect. Artificial intelligence (AI) combined with the harvesting of photos, videos, and postings can discern buying patterns and recommendations for further purchases. Although marketing products may be relatively benign, there are other purposes that may be gained from the skillful use of data, photos, and other personal information we freely give to the gaping maw of social engagement.

TikTok Privacy Violation

The design and technology site Gizmodo reported that TikTok had attempted to modify its privacy policy allowing TikTok to automatically collect mountains of voice and face data from U.S. users. In a series of 21 lawsuits, many filed on behalf of minors, plaintiffs accused TikTok and a now-defunct sister app, Musical.ly, of using a “complex system of artificial intelligence to recognize facial features in users’ videos”.

The AI used that collected data to determine a user’s age, race/ethnicity, and gender in order to recommend content and profiles for the user.

TikTok agreed to settle a $92 million class action lawsuit allowing any TikTok user prior to Sept. 30 to apply for restitution. Court documents related to the case state:

“By utilizing this private and biometric information, TikTok maintains a competitive advantage over other social media apps and profits from its use of improperly obtained data, all while failing to comply with the minimum requirements for handling users’ biometric data…”

Suits were filed in Illinois where the Biometric Information Privacy Act grants the right to sue companies accessing biometric data without consent.

TikTok’s parent company, ByteDance, denied that it ran afoul of the law, agreeing to settle the suits in order to avoid going to trial. In a statement, ByteDance said:

“While we disagree with the assertions, rather than go through lengthy litigation, we’d like to focus our efforts on building a safe and joyful experience for the TikTok community.

As part of the suit, TikTok has also agreed to stop disclosing users’ personal data to third parties like Facebook and Google, according to NBC News, and will also cease to record users’ facial features and track their location using GPS.

The questions each social media user should be asking right now are:

  • What are companies doing with my photos, videos, and online presence?
  • Is my personal information being used for something I approve of?
  • Am I protected from misuse of my personal information?

For a great many of us, our answer to all three questions would be the same: “I don’t know”.

Aspen Insurance Agency is a family-run business in Denver, CO servicing clients nationwide. We work with multiple insurance carriers to offer our customers a wide variety of risk reduction coverage at the lowest possible cost. We offer a wide range of personal, auto insurance, commercial and professional insurance to residential and commercial insurance customers enabling the cheapest rates available. Call to speak to one of our insurance advisors and see how painless insurance shopping can be.

Small Business Cyber Losses

It should be no surprise that cyber-attacks are on the rise. Many small business owners may feel they do not need to worry as cyber losses “only” affect large companies. Though, nearly 60% of small business owners have had data compromised, experienced a security breach, or both. This is according to a survey by The Identity Theft Resource Center (ITRC).

25% of survey respondents reported an incident in the past 12 months. 54% experienced a cyber event during the past two years. These survey findings confirm that small businesses are frequently targeted. Hacker attack methodologies are automated searching any publicly accessible website (and what company does not have a public-facing site?) for a possible entry point.

Not only have more than one of half survey respondents experienced an incident; three-fourths reported more than one cyber event and one-third have had at least three, the center reported.

Cost of Cyber Recovery

Survey results also show the cost of recovering from cyber events: 44% of small businesses spent $250,000-$500,000 to cover the costs, while for 14%, the cost to recover was between $500,000 to $1 million. For many small business owners, having the capital to cover these expenses required 36% of businesses owners to borrow, 34% to raid cash reserves. Less than 30% turned to their cyber insurance to help cover the expenses.

More than 40% of businesses needed one or two years to recover, while over 25% said it took three to five years to recover.

While hackers and external threats launch most incidents, the survey found only 40% of breaches were a result of external actors.

Malicious employees and contractors accounted for 35% of incidents, while remote workers were responsible for 25%. Third-party vendors, failure to secure cloud environments, software flaws, and phishing schemes were also leading causes. The source of 3% of data and security breaches is unknown.

Small business owners should take positive steps to combat the threat of hacking and protect the business from external and internal threats.

Aspen Insurance Agency is a family-run business in Denver, CO servicing clients nationwide. We work with multiple insurance carriers to offer our customers a wide variety of risk reduction coverage at the lowest possible cost. We offer a wide range of personal, auto insurance, commercial and professional insurance to residential and commercial insurance customers enabling the cheapest rates available. Call to speak to one of our insurance advisors and see how painless insurance shopping can be.

Work-At-Home Workers Compensation Claims

Work-At-Home Workers Compensation Claims

Working from home became mandatory for office workers during the Covid Pandemic. To prevent illness and the spread of disease, workers were sent home, with computers in hand, to maintain company and employee safety.

And for many workers, what a great thing it was! Commuting as far as the kitchen for a cup of coffee saved American workers hours in commute time and, for many, the cost of business clothes.

However, just because work was performed from the safety of the home did not eliminate worker on-the-job injuries. The fact is, from using ergonomically challenged workspaces to changing mind frames, working from home hosts a range of risks for soft-tissue injuries.

Location, Location, Location

The modern office work environment includes ergonomically friendly desks, keyboard trays, supportive chairs, and safe walking spaces, meant to reduce the potential for injuries. Sadly, working from home may mean, working at the kitchen counter from a stool. Or perhaps propping the laptop on a coffee table working from the couch. Whatever the setup was, and perhaps still is, those on-the-fly, makeshift work-from-home setups are leading to an increased risk of soft tissue injuries.

While the dining room table and chair set might be a great place to share a meal, it isn’t designed to support someone throughout a workday, The same goes for those couch potatoes slouched over a laptop or hovering above a coffee table.

“There is also a blurring of lines of when we work and don’t work,” explains ergonomic experts. “The computer is sending out messages to us, ‘a little more time, a little more time.’ Even if you had a work setup at home, and not many did, they weren’t set up to take the breaks you normally would during the day.”

This always-on mind frame can also lead to employee burnout.

Over time, typing away with inappropriate posture and ergonomically unfriendly spaces — combined with employees not taking breaks or doing exercises — increases strain on the back and that can lead to neck and back pain.

For those employees experiencing back pain, getting an accurate diagnosis early is critical to achieving better outcomes. However, diagnosing and treating soft tissue injuries is difficult, as they are very subjective.

“Relying on someone self-reporting an injury, especially when not in the workplace, presents an extra challenge for employers,” says Mary Reaston, founder and CEO of Emerge Diagnostics, a medical diagnostic technology company helping clients in multiple industries diagnose soft tissue injuries.

On the Clock? Or, Around the House?

This also presents a predicament for workers’ comp: how do you determine if a self-reported remote work injury was an on-the-clock incident or an “around the house” injury?

“That is the billion-dollar question. There is no good way to tell,” Reaston says. “If you reach behind you to grab a bag of Cheetos or a file and are injured, no one is going to be able to tell.” She notes the key is to get early intervention and a detailed history of how the employee describes the incident.

While it is not possible to eliminate these risks, they can be reduced. For instance, if the workforce is small enough, an employer could supply more ergonomically friendly working surfaces and tools, such as home office setups including worktables and ergonomic chairs.

“I think employers have to be tuned into their remote workforce and realize the same set of risk factors they have in a controlled setting, like an office, still apply with remote workers,” she says. “They need to talk to employees that are working from home and set some boundaries. Tell them not to let the lines blur (between work and home life). And tell them to report any injury early.”

Aspen Insurance Agency is in Denver, CO, and services clients nationwide. We are a family-run business working with multiple insurance carriers to offer our customers the coverage they need at the lowest possible cost. We offer a wide range of personal, auto insurance, commercial and professional insurance to residential and commercial insurance customers enabling the cheapest rates available. Call to speak to one of our insurance professionals and see how painless insurance shopping can be.

Protecting Small Business From Lawsuits


America is a litigious society: attorney TV commercials abound screaming “I can get you money!” The last thing you want is your business is being sued. Lawsuits are costly in money, time, and reputation, let alone the stress of fighting for your business as many times, lawsuits can put you out of business.

So, how can we minimize the risk of lawsuits?

Have Written Agreements: Keep Accurate Records

Signed agreements and good record keeping can be a business lifesaver, helping to resolve disputes and clarify the rights and duties of each party, if you’re sued.

Attorneys can advise the types of formal contracts you need, such as employment contracts and general sales and supplier agreements and, you will also want to capture the scope of services and products you promise to provide. For example, accurately and thoroughly record the scope of services or products you’ll provide, along with price and delivery date. Many disagreements arise when both parties misunderstand the scope of services or the accuracy of products to be delivered.

Make sure to retain all related records, including emails and notes from phone conversations, and make every effort to ensure those product or service details are part of the approved and final scope, in the event a conflict does arise.

Protect Your Reputation

A Marketing adage states: “a happy customer tells 3 of his friends: an unhappy customer tells 30”.

Businesses run on reputation. Complete every transaction with integrity in all dealings with customers, competitors, and the community. If you say you are going to do something, do it. If you make a promise, keep it. Bending the rules or misrepresenting your business, products or capabilities could come back to haunt you in the form of general mistrust, lost business, and potential lawsuits.

Acting with honesty and integrity helps lay a foundation for a business to prosper.

Employ Sound Employment Practices

There are many state and federal laws that govern the workplace, laws regarding workplace harassment, discrimination, or the privacy rights of your employees. Familiarity with and adherence to these laws is important. Employment Practices Liability insurance can help protect you if an employee claims you engaged in wrongful employment practices.

Be sure you recognize which laws apply to your business and learn about the requirements of each. Then create and enforce policies to ensure you are complying. A human resources consultant or an employment lawyer can be a great advisor in this area.

Treat your employees fairly and honestly. Expect a good day’s work in exchange for paying a decent living salary and benefits.

Be Prepared with an Experienced Lawyer

When legal issues do come up in your business, consult with a lawyer you know, who knows you and your business practices, on those questions which could lead to a lawsuit.

Look for a reputable lawyer with expertise in matters associated with the size and your type of business. For instance, if you run a trucking company, working with an attorney knowledgeable on the issues facing logistics and delivery companies can proactively help you stay in compliance with the law and spot potential legal issues early.

One of the best ways to avoid a lawsuit is to evaluate your current practices looking for areas where you may have improvement opportunities.

Separate Your Personal Finances from Your Business

Many small businesses operate as sole proprietorships. Though the easiest and least costly way to set up and run a business, sole proprietorships also come with what some might consider a significant disadvantage. As the owner, you are personally liable in the event of a lawsuit.

Structuring your business as a limited liability company (LLC) or corporation is a protective measure allowing you to separate your personal assets from any liability-related lawsuits to your business.

Explore the benefits of this type of structure with your legal advisor.

Be Aware of Your Insurance Coverage Needs

Insurance is another way to reduce the financial impact of a lawsuit. General Liability Insurance, typically part of a Business Owners Policy, or BOP, covers small business risks, including claims related to bodily injury (for instance, injuries from customers or employee slipping and falling), property damage, and even advertising injury (copyright infringement in one of your advertisements). 

Commercial Auto Insurance can help protect your business and your employees against liability for driving-related accidents and protect your business autos for physical damage. Depending on your business, you may also need more specialized insurance.

For instance, if your business offers professional advice or services to clients, Professional Liability insurance can help cover the cost to defend your business against a lawsuit claiming damages resulting from an error or omission in providing your services.

An additional layer of protection comes from purchasing Umbrella Insurance, additional coverage over and above the coverage limits of your primary liability policies. Umbrella Insurance helps defend against large, unexpected losses which are not entirely covered by your basic professional liability coverage.

Speak to your Aspen Insurance advisor to review your current coverage and determine if it is sufficient. Most liability policies only cover half of the liability judgments. Be prepared as if your business depends on it: as it might!

Aspen Insurance Agency is in Denver, CO, and services clients nationwide. We are a family-run business working with multiple insurance carriers to offer our customers the coverage they need at the lowest possible cost. We offer a wide range of personal, commercial, and professional insurance to residential and commercial customers enabling the best rates available. Call to speak to one of our insurance advisors and see how painless insurance shopping can be.

Is Real Estate Investing Boom or Bust?


Is the real estate market about to bust? Blackstone Group Inc. President Jon Gray doesn’t think so. He has advice for investors looking to make sense of the U.S. real estate market. “Don’t fear a bust anytime soon.

Home prices surged to their highest levels since 2005. Cheap mortgage interest rates are encouraging buyers toward new homes, while building costs are spiking due to rising raw material prices. Meanwhile, a worker shortage has reduced new construction. In commercial real estate, the wider acceptance of remote work during the Covid-19 pandemic is creating office vacancies across the country.

Despite all that, now’s a pretty good time for the market, according to Gray, who has been at the center of the biggest booms and busts in the industry over the past three decades.

The market isn’t showing the typical warning signs — too much leverage, too much capital, too much building, Gray said. There will be a “rediscovery” of cities such as New York and San Francisco, fueled by immigrants, creativity, entrepreneurship, and technology.

The billionaire also spoke about where he’d put $100,000 today, what to avoid pouring money into, the best way to invest in real estate, and how President Joe Biden’s tax policies could affect property owners.

Gray’s journey at the New York-based firm began in 1992 and by 2005, was running the real estate investment unit. Over the next 13 years, Gray built it into a behemoth with $115 billion of assets. The below is a condensed version of the Q and A between Gray and Bloomberg Wealth.

Question: The economy has been pretty good, but will probably head down at some point, so is this a good time to invest in real estate?

Answer: It’s still a pretty good time for real estate for a couple of reasons. There are two warning signs; one is too much leverage and too much capital, and neither is really the case in the real estate system today. The second is too many cranes and too much building, and we’re actually below historic levels in terms of new supply.

The other thing I’d point out is that the S&P 500 delivered something like four times the return of public REITs since the beginning of 2020, before Covid. So real estate is lagging coming out of the recovery because obviously people have been concerned about the physical world. As the economy reopens, people go back into spaces, real estate will see a little bit of a bounce. I think the risk is if interest rates move a lot.

Another positive thing about real estate is inflation drives up the replacement cost of buildings. And that gives you a little bit of a cushion on existing real estate.

Question: Is residential less or more risky than commercial real estate?

Answer: If you mean for-sale, single-family housing, there’s probably more risk in the sense that you’re building something and you’re selling it, and it’s a function of the market. If you’re talking about rental housing, such as an apartment complex, that tends to be less risky because it’s less cyclical. People don’t give up their apartments. There’s some volatility but nothing like, say, office buildings or hotels.

And then commercial real estate involves office buildings; warehouses, which has been the biggest theme for us over the last 10 years; hotels; shopping centers; senior living facilities. And all of them have different risk returns, depending on geography.

Question: New York City has seen a lot of people leave during Covid. Do you expect that people will come back, work five days a week, and use all the office space in New York or similar cities that they did before?

Answer: There is a sort of recency bias because we’ve been home, we assume that’s the way it will continue. When I think about our company, we know we’re better together. We’re better at being creative, we’re better at solving problems, we’re better at training our young people. It’s really an apprenticeship business, learning how to invest. We have a lot of smart, talented people who are connected by culture. Being together matters.

Some companies will conclude they don’t need quite as much space, so that’ll create some additional vacancies. People will be concerned about owning office buildings, and that may create an opportunity. There will be some headwinds for a number of years and then, over time, things will recover.

I would point out, though, outside the U.S., for instance, in China, buildings are back to full capacity. In Europe, people don’t have as much living space in their homes. So not all geographies are the same. And even here, I think there’ll be a bias toward going back to the office, even though it won’t be like it was before.

Question: A lot of people have moved to Florida and Texas, maybe for warm weather, maybe because those states don’t have income taxes. Do you think that trend will continue? And is that a good place to invest in real estate now?

Answer: It’s a bit of both. The weather, the lower cost of living, lower taxes, concerns about the quality of life. Texas is one of the fastest-growing states in the country, even though it’s enormous. I think that will continue, and it was accelerated a bit by the pandemic. On the other hand, New York City, San Francisco, are amazing places. And when you think about technology and innovation, entrepreneurship, immigrants, there will be a rediscovery of these cities. But, yes, Texas and Florida are well-positioned.

Aspen Insurance Agency is in Denver, CO, and services clients nationwide. We are a family-run business working with multiple insurance carriers to offer our customers the coverage they need at the lowest possible cost. We offer a wide range of personal, auto insurance, commercial, and professional insurance to residential and commercial insurance customers enabling the cheapest rates available. Call to speak to one of our insurance professionals and see how painless insurance shopping can be.

Seeing Through Auto Windshield Repair

Auto windshield repairs are the number one auto insurance claim in the United States representing 30% of all auto claims. 70-80% of those claims are for “edge cracks”: cracks affecting the initial two inches of the windshield perimeter. As windshields are made of multiple fused together layers of glass (“annealed”), windshields may have a manufacturing defect known as “residual stresses”, created during the annealing process.

Not surprisingly, the major cause of windshield damage is flying rocks, creating windshield chips. Gravel is everywhere on the road, and cars and trucks traveling on the highway can kick rocks up. Rocks traveling at a high rate of speed meeting your windshield while you are also traveling at a high rate of speed can chip the top liner or carry through into both the outer and inside glass, causing cracks. Semi-trucks and construction vehicles carrying gravel are the two largest causes of airborne rock debris.

Which prompts questions for auto owners. If my windshield is damaged:

  • Should I replace the windshield?
  • Should I have my windshield repaired?
  • Can I just leave the crack alone?
  • If I do repair or replace the windshield, can I claim the repair on my insurance?

Repair? or Replace?

Federal law holds that cracks and chips smaller than 3/4 of an inch are permitted if they’re three inches or farther from other chips or cracks and, are not located within the driver’s view. While most police officers probably won’t stop you specifically because of a cracked windshield (which is not to say they absolutely won’t), there is the possibility of a second violation added onto another ticket.

Even if the chip or crack is located out of the drivers’ view, you may not be safe from receiving a traffic ticket. States carry their own specific laws: for example, the state of Illinois prohibits anything that obscures the view through the windshield or impedes the function of windshield wipers.

Recognize that small chips or cracks could easily grow into long cracks. Normally, a crack shorter than six inches and chips or dings fitting under a credit card can all be repaired. Cracks longer than twelve inches may require a windshield replacement, although some manufacturers have developed compounds successfully repairing cracks up to twenty-four inches in length. Repairs should be done as soon as possible to prevent cracks from getting worse.

Replacing the Windshield

Windshields are an indispensable component contributing 70% of the structural integrity and safety of a vehicle’s passenger compartment. Consumers should be cautious as a replacement may not match the structural support of the original installation, resulting in injuries and fatalities.

According to a report by ABC’s 20/20, 75% of windshield installations are done incorrectly, because of the lack of industry regulations and requirements:

  • Glass installers do NOT have to be licensed to be in business.
  • Anyone can legally install auto glass regardless of knowledge or training.
  • Some companies use inferior products or cut corners to save money.

All of which could lead to costly and fatal consequences:

  • Roof Cave in During a Roll-Over Accident:  As the windshield supports the structural integrity of the vehicle during a rollover accident, if the windshield doesn’t stay in place, the roof will collapse.
  • Airbags Not Working: Your car’s airbags bounce off the windshield when deployed. If the windshield was improperly installed, it can cause the airbags to blow the windshield out of the vehicle instead of bouncing off it, increasing the driver’s danger.

This is not to say, the windshield should never be replaced. There are times the windshield damage is severe enough the windshield must be replaced. If you must replace your windshield, find a reputable installer who uses quality materials and employs trained and experienced installers.

When a windshield is replaced, expect to be able to drive within an hour. However, it may take 8-24 hours for the adhesive to fully dry, meaning 8 – 24 hours before the windshield is fully set and will not pop off in the event of an accident.

Can I Repair My Windshield?

Windshields should be repaired when:

  1. The glass is tempered, not laminated.
  2. The crack is longer than a dollar bill.
  3. The crack or chip is deep enough that it goes more than halfway into the windshield.
  4. The crack or chip extends to the outside edge of the windshield.

Windshields should be repaired as soon as is practical as a small chip can spread across the windshield upon hitting a big pothole, or when driving on a bumpy road, or if making an aggressive turn. In several states, it is illegal to drive a car with a cracked windshield.

Originally, damaged windshields had to be replaced, which became quite expensive. As the technology evolved to repair windshields, insurance companies chose to cover the full cost of repair, as it was much cheaper than replacing the windshield. Repairing is also desirable because it maintains the original factory installation (and structural integrity) of the windshield. Repairing also helps the environment by reducing trash.

You may wonder which is safer: repairing or replacing? In the 30-year history of windshield repair, there has never been an injury or lawsuit from a windshield repair. There has been a number of injuries and deaths caused by windshield replacements.

How Much Does It Cost to Repair a Windshield?

Repairing typically costs about $50 for the first chip, plus about $10-$15 per additional chip. Cracks are more expensive to repair. Depending on the length, a crack could cost up to $100-$150. Replacing a windshield is significantly more expensive; the average price is commonly around $400 and can be well over $1,000 if an OEM windshield is used.

When looking for repairs, always get multiple bids and use reputable installers. We also recommend:

  • Look for companies affiliated with the Auto Glass Safety Council.
  • Ask what kind of warranty covers the work.
  • Get more than one written estimate when you’re looking for a repair company.
  • Pay only once the work has been completed.

How Does My Car Insurance Help?

Normally, cracks in windshields are covered under the Comprehensive section of your car insurance policy. Not all policies include comprehensive coverage, so you do want to confirm your coverage. Also, the cost of repair may not be covered by your deductible (the normal deductible amount being $500). However, some states require no deductible (in which case you pay nothing), and others have lower deductibles.

Some insurance companies encourage motorists to repair rather than replace windshields by covering the full cost of repair (far cheaper for the insurance company than paying for replacement). If the windshield does need to be replaced, be advised you can open a claim, and you will be subject to paying your deductible.

Always feel free to speak with your Aspen Insurance advisors for expert advice on handling windshield problems.

Aspen Insurance Agency is in Denver, CO, and services clients nationwide. We are a family-run business working with multiple insurance carriers to offer our customers the coverage they need at the lowest possible cost. We offer a wide range of personal, commercial, and professional insurance to residential and commercial customers enabling the cheapest rates available. Call to speak to one of our insurance advisors and see how painless insurance shopping can be.

Avoid Business Insurance Purchasing Mistakes – Part II

Continued…..

Owning and operating a business takes a lot of time and energy: satisfying customers, attracting, finding, and retaining talented employees, marketing products and services. The list goes on and on, and on. One responsibility which may not receive the attention it should is ensuring your business has appropriate insurance coverage.

Here are some of the mistakes made by businesspeople when choosing insurance.

Failing to Read Your Policies

Your insurance policy does not make for exciting reading but knowing what is and is not included is crucial.  It is the only way to know what risks are covered and which are excluded. Looking at your policies after a loss occurs is not effective timing. You cannot buy coverage for a loss that has already taken place.

While many insurance policies are written in simplified language, they still contain some “legalese.” If you have trouble comprehending the wording, ask your trusted insurance advisor or attorney to explain the policy wording.

Buying Too Little Property Insurance

When insuring buildings and personal property under a commercial property policy, make sure to have adequate limits. This is essential even if your policy includes replacement cost coverage. While the replacement cost coverage will automatically cover the cost to repair or replace your damaged property, it will not pay more than the limit of insurance. If the cost to repair or replace your property exceeds the limit, your policy will only cover that portion of the loss within the policy limits.

Watch out for coinsurance clauses and agreed value provisions, which are often found in property policies. Both impose a penalty for underinsuring your property. If a loss occurs and you have failed to maintain a minimum amount of insurance, your insurer will not pay the full amount of the loss. Deliberately underinsuring your property is not a good way to save money on property premiums.

Failing to Insure Potential Income Losses

Many business owners are careful to insure their company’s physical assets but fail to consider a common consequence of physical losses, namely a loss of income. A company will lose income if its premises suffer a physical loss and the business cannot operate until the damage is repaired.

Business Income insurance is intended to help companies survive an interruption in operation by reimbursing the company for the income it would have earned if the loss had not occurred. It also covers continuing expenses like rent or electricity regardless of whether your business is operating.

Your business may also need Extra Expense insurance: which covers expenses you incur to avoid or minimize a shutdown when property has been damaged by a covered peril.

Failing to Accurately List Entities or Locations

Under most liability policies, only the people or entities shown in the declarations qualify as named insureds. People or entities not listed on the policy generally are not covered.  Failing to list a business entity on a general liability, commercial auto, umbrella, or other liability policy can have disastrous consequences.

For example, for tax reasons, you transfer ownership of all your business property to a newly created subsidiary. However, your liability policy only lists your company name as the named insured, not the new subsidiary. Were an accident to occur on the property and the subsidiary sued, your insurer can refuse to cover the claim as the subsidiary was not named on the policy.

Similar problems can occur if business locations are omitted from a commercial property policy. Most property policies cover physical loss or damage to covered property at the premises described in the declarations. If damaged property is situated at premises not shown on the policy, the damage may not be covered.

Sticking With the Same Insurer or Policy for Too Long

While a long-term relationship with an insurer can be an asset, avoid staying with an insurance company no longer meeting your needs. An insurer (or insurance policy) that was suitable for your business in the past may no longer provide adequate coverage.

Insurers do change over time. Some grow and expand their product offerings, some improve the quality of their service while others allow theirs to decline. You can determine whether your insurer is still competitive in the marketplace by asking your trusted insurance advisor to obtain quotes from other insurers.

The best advice is to meet with your trusted insurance advisor every few years for a full assessment of your risks and insurance needs to determine you have the most appropriate coverage for your current and future business needs.

Aspen Insurance Agency is in Denver, CO, and services clients nationwide. We are a family run business working with multiple insurance carriers to offer our customers the coverage they need at the lowest possible cost. We offer a wide range of personal, commercial, and professional insurance to residential and commercial customers enabling the cheapest rates available. Call to speak to one of our insurance advisors and see how painless insurance shopping can be.

Avoid Business Insurance Purchasing Mistakes – Part I

Owning and operating a business takes a lot of time and energy: satisfying customers, attracting, finding, and retaining talented employees, marketing products and services. The list goes on and on, and on. One responsibility which may not receive the attention it should is ensuring your business has appropriate insurance coverage.

Here are some of the mistakes made by businesspeople when choosing insurance.

Buying on Price Alone

When shopping for any form of insurance, it makes sense to shop around. Some insurers provide better value than others, meaning the policy which costs the least will not be a bargain if you and your business are left vulnerable to costly claims.

Obtain quotes from multiple insurers and compare the proposals in detail, line by line of offered coverage. Be sure to consider the types of coverage and the coverage amounts listed in a quote. Here is where your trusted insurance advisor can help you by explaining what is covered and what your level of risk exposure might be.

Always know what exclusions and limits exist in any policy under consideration.

Buying Too Little Liability Insurance

Every small business can be hit with a lawsuit, costing anywhere from $3,000 up to $150,000 or higher. Legal actions can threaten your company’s financial stability and its reputation. One large claim could put your company out of business. Don’t skimp on coverage limits when buying general liability or auto liability insurance.

Many businesses will not employ you as a sub-contractor until you provide proof of liability insurance, with a minimum coverage amount specified in the contract. A landlord may refuse to lease property unless your business has purchased sufficient liability insurance. 

 Automatically Choosing a Low Deductible

A deductible can reduce the cost of insurance premiums as it enables the business owner to pay small losses out of pocket as a form of self-insurance.

Do not automatically select the lowest deductible when buying commercial property or auto physical damage insurance. Rather, consider how much premium you will save by raising the deductible. Generally, choose the largest deductible the business can comfortably absorb in the event of an accident.

Failure to Adjust Your Coverage as Your Business Changes

Most businesses change over time: small companies may grow adding locations and hiring additional employees. The mix of products or services offered may expand into new potential business areas. As businesses change, insurance needs change as well.

When making a major change to a business, such as acquiring a new company or location, notify your agent or insurer right away. Any other changes should also be reported before policies renew. Plan to talk with your trusted advisor annually to review business insurance coverage and limits to determine if your insurance needs have changed.

Your agent can help you decide whether your insurance coverages or limits should be adjusted.

Plan to meet with your trusted insurance advisor every few years for a full assessment of your risks and insurance needs to determine whether you have the most appropriate coverage for your current and future business needs.

Aspen Insurance Agency is in Denver, CO, and services clients nationwide. We are a family run business working with multiple insurance carriers to offer our customers the coverage they need at the lowest possible cost. We offer a wide range of personal, commercial, and professional insurance to residential and commercial customers enabling the cheapest rates available. Call to speak to one of our insurance advisors and see how painless insurance shopping can be.

Teen Drivers

Freedom of the Road

One of the great moments in a teenager’s life is receiving their driver’s license. For parents, it is a moment of pride in their son or daughter growing up. That pride is quickly overcome by fear, doubt, and uncertainty. What of their child’s safety? Will their teen be one of the many teen driver accident statistics? What will having a teen driver in the household do to my car insurance rates?

Parents primary concern is, of course, for the safety of their first-time driver and others sharing the road. With little prior driving experience, inexperienced drivers are at an elevated risk for accidents. Although safety certainly is a main concern, controlling cost and confirming sufficient coverage to protect against liability claims is also a major consideration. Even in the absence of any claims, many parents might also be concerned about the increased cost of auto insurance.  

Auto insurance, whether acquired through an insurance broker or insurance agent, can be expected to increase between $100 to $250 a month or more once a teen driver is added to the policy.

Parents should also take proper steps to further reduce risk by understanding how teen driving affects car and home policies. Working with your Aspen Insurance advisor is a great place to consider available options in coverage and in reducing financial exposure.

Include Your Teen in Car Insurance Discussions

Begin by making teens fully aware of the potential consequences of their actions. No one sets out to hit another car, hence the reason they are called “accidents”. Your teen should recognize driving is a privilege, a privilege which comes with responsibility.

Driving a car is piloting more than 3,000 pounds of steel and gasoline. A collision even at a slow rate of speed can cause a great deal of damage, including severe bodily injury. Teens should be aware that 98% of the time, driving is a low-risk endeavor. However, that risk increases greatly when drivers are distracted by high rates of speed, mobile phones, friend’s conversations or altered states.

As a result, automobile accidents can have far reaching financial consequences affecting your family’s financial future. As parents, we should continually reinforce driving safety and alert our teen to the negative consequences of receiving a driving citation or being at fault in an acciden, both of which result in insurance rate increases.

Teen Driving Statistics

Younger drivers may feel invincible, as in: “I can text and drive”, “I’ll keep my phone handy in case someone calls”. Statistics demonstrate something very different:

  • In their first year of driving, 1 in 5 16-year-old drivers will have an accident!
  • In 2019, distracted driving was a reported factor in 8.5% of fatal motor vehicle crashes.
  • Over 74,000 young people die or are injured each year by not wearing seatbelts.
  • 42% of high school students across the United States admitted that they text or email while driving.
  • Two-thirds of teen passenger deaths are in vehicles driven by other teenagers.
  • In 2018, 2,500 adolescents (ages 12-19) died and approximately 297,000 had nonfatal injuries resulting from motor vehicle crashes according to the most recent teen driver safety statistics compiled by the National Highway Traffic Safety Administration.
  • Underage drinking and drug use is illegal. Your automobile policy may be void if a car accident involves illegal activities.  

Taken together, these statistics show an alarming pattern of risk for less experienced drivers. In-car distractions and inexperience all contribute to a higher rate of accidents for teenagers.

Distracted Driving

According to the CDC, eight people are killed in the US each day in crashes reported to involve a distracted driver. Although not just a problem affecting teen drivers, teens are over-represented in distracted driving statistics. We should remind our teens that in three seconds, a car travels over 170 feet at thirty-five MPH.

There are three main types of distraction:

  • Visual: taking your eyes off the road
  • Manual: taking your hands off the wheel
  • Cognitive: taking your mind off driving

In the U.S. in 2018, over 2,800 people were killed and an estimated 400,000 were injured in crashes involving a distracted driver. About 1 in 5 of the people who died in crashes involving a distracted driver in 2018 were not riding in vehicles: they were walking, riding their bikes, or standing in their front yard.

Have frank discussions with your teen about the dangers of distracted driving and what distractions they need to prevent. Both holding a mobile phone or texting while driving are distractions, as is having a phone conversation while driving. Not only is cell phone use a distraction, but it is also against the law and a citable offense in many states.

Twenty-five states, D.C., Puerto Rico, Guam and the U.S. Virgin Islands all prohibitdrivers from using handheld cellphones while driving. All are primary enforcement laws; a traffic officer may cite the driver for using a cell phone. Thirty- states and D.C. ban all cellphone use by novice drivers, and 23 states and D.C. prohibit it for school bus drivers.

Currently, forty-eight states, D.C., Puerto Rico, Guam, and the U.S. Virgin Islands ban text messaging for all drivers.

Cell phones are not the only possible in-car distraction. Driving large groups of friends may cause the driver to lose road awareness for a few seconds: in those few seconds, a car traveling at 60 MPH will have traveled close to 200 feet!

Teen Education Discounts

One way to reduce the increased cost of auto insurance is with education discounts. Many insurance companies offer premium reductions for teens maintaining good school grades. Some discounts your teen driver may be eligible for include:

  • Students maintaining an average of “B” or above.
  • Teens completing a recognized driver training course, either through AAA, school or through local programs.
  • College students attending school a minimum of 100 miles away from home who do not bring their car to campus.
  • Teen (and adult) drivers using SafeDriving or TeleTrack applications receive discounts for verifiable safe driving habits.

Choose the Appropriate Auto Insurance Company

It will normally be cheaper to add teenagers to an existing parent policy rather than having teens purchase their own. Adding an additional automobile to an existing policy may enable a multi-vehicle discount.

Different insurance companies use proprietary methods for pricing young driver policies. Ask your insurance agent to research alternative possible policies, searching for the best fit for your specific circumstances.

Assigning Your Teen to the Correct Car

Some insurance companies will “assign” the most expensive-to-insure driver to the most expensive-to-insure car, increasing the total cost of your auto insurance. One possible way to reduce your insurance cost is to have the company assign your teen to the least expensive car. This will reduce the potential cost of damages and lower the monthly fees.

However, your teen must use the car to which they are assigned. If your teenager is involved in an accident driving a car they were not assigned to, there could be penalties, premium increases or negate the policy coverage.

Increase Liability Insurance for Greater Protection

Be advised that state minimums for liability insurance may not be sufficient to fully protect from lawsuits, were your son or daughter to be in a collision. It may be in your best interest to purchase umbrella policies with higher amounts of coverage for increased financial protection. If your teenager is involved in a collision and is found to be negligent, the damages could easily exceed the state minimum liability.

If you (or your teen) are found financially responsible, you could be sued in court for the amounts above and beyond your coverage maximum.

Changing Conditions

Depending on your state of residence, teens may have to contend with driving in changing conditions. The road to your house on bright, sunny can easily be navigated at 50 MPH. In high winds, or heavy rain, that same road may be unsafe at 35 MPH. Let your teen know of the varying road conditions which could impact speed and safety:

  • High water
  • Hydroplaning
  • Bright sun shining on the windshield.
  • Snow
  • Ice

All the above conditions change the operating safety and should also alter rate of speed. Teens should be advised of the increased caution required for driving in adverse conditions and the appropriate response to such conditions. They should know how to control a skid on snow, ice or mud, and proper driving speed for weather conditions.

These are all things which may not have been taught in driving classes and could increase the possibility of sliding into either other vehicles or stationary objects on the side of the road.

21st Century Driving

Cars continue to get larger and heavier, with the ability to cause considerable damage even at the lowest rates of speed. Cars are safer, and that safety engineering comes at a cost of more expensive auto repairs. Cell phones, text messages, after-school friends, dating, unfamiliar roads are all common situations which could cause your son or daughter to lose concentration with devastating results.

Make sure you and your family are protecting your financial security while minimizing the risk for your driving teen.

Aspen Insurance Agency is in Denver, CO, and services clients nationwide. We are a family run business working with multiple insurance carriers to offer our customers the coverage they need at the lowest possible cost. We offer a wide range of personal, commercial, and professional insurance to residential and commercial customers enabling the cheapest rates available. Call to speak to one of our insurance professionals and see how painless insurance shopping can be.