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Insurance:
Frequently Asked Questions
about insurance, risks, coverage...
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Accident With a Borrowed Car
Rental Cars
What to Do After an Accident
Cellular Phone Coverage
Lease Loan Gap Coverage
New Car Selection
Ohio's Graduated Driver
Licensing Law
Uninsured Motorists Insurance
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Accident With
a Borrowed Car: Whose
policy pays?
If you lend your car to a friend and your friend has an
accident, it might be your insurance that's on the
hook. It all depends on the insurance company that issued
your policy. One company’s policy may state:"the insurance
follows the car"; while another company’s policy says the
driver’s insurance is the primary coverage even though you
own the vehicle involved.
Let’s take a look at the two different scenarios:
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If the insurance follows the car
and you lend your car to a friend, your coverage
is considered the primary coverage. If your friend has
an accident, it’s your insurance that will pay the
claim. If the accident is serious enough to use up all
of your policy’s coverage, then your friend’s coverage,
which is considered secondary, might also be used.
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If the insurance follows the
driver, coverage is provided
the other way around. If you lend your car to a friend
and they have an accident, it’s their policy that
is considered primary coverage, meaning their insurance
company will pay the claim. In this case, your policy
would be secondary and wouldn’t pay for anything unless
your friend’s policy limits were used up.
All these rules go out the window in many
cases if the person borrowing the car happens to be a
relative who resides in the same household as the owner. You
should read your policy carefully to see what type of
coverage applies to you.
Remember these two things: First, always exercise caution
when it comes to lending your car. Second, if you're ever in
doubt about whether you or another driver is covered in any
given situation, please call us.
Greenwood Insurance Agency,
330-637-7085
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Rental Cars: Should you purchase
rental agency coverage?
If you have collision and comprehensive ("other than
collision") coverages on your own car, you are most likely
covered if you're traveling in the United States, its
territories and possessions or Canada (for example, travel
in Mexico, the Bahamas or Europe would not be covered).
Most policies (except business policies) cover any rental
car that you drive at no additional premium. Business cars
frequently require an extra premium to afford the same
coverage. Give us a call before you leave for your "fun in
the sun and/or snow" to confirm your coverage.
Greenwood Insurance Agency,
330-637-7085
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What To Do
After an Accident.
You've been in an accident. Here are some general
guidelines about what to do next:
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Stop at once. Never leave the scene
of even a MINOR accident.
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Seek medical assistance and summon
police.
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Do not admit fault. Do not comment
about the accident to anyone but your insurance
representative and the police. Never accept or make an
offer of cash, check or "private" settlement.
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Gather accident information. Note the
date and time of accident.
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Obtain information on the other
driver including: name, address, phone number, make of
car, vehicle license number, insurance company and
agent's name and telephone number.
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Record a description of what
occurred.
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Draw a diagram of the accident
showing the direction of both cars and the point of the
accident. Include street names and location of traffic
signs/signals.
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Report the accident promptly to your
insurance agent.
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Cellular Phone Coverage
Since many of us now have cellular telephones, we thought it
might be worthwhile to highlight a few points regarding how
insurance applies to this technology:
If a cellular phone is stolen from your car (or along
with your car if it is stolen), is the phone covered by your
auto insurance?
No, it is not unless the phone is permanently installed and
powered by the car's electrical system.
Is your portable cell phone covered by your homeowners or
renters insurance?
Sometimes it is, but coverage is subject to the policy
provisions and deductible in your homeowners or renters
policy.
Can you buy broader coverage for your portable cell
phone?
Yes, most companies offer a special, broader coverage for
portable cell phones that can be added to a homeowners or
renters policy. Call us for details.
What if you lease a portable cell phone?
If you lease a phone, check with the company you lease the
phone from to see what (if any) coverage they may provide.
You may then want to check with us to compare coverages and
cost. Greenwood Insurance Agency,
330-637-7085
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Lease Loan Gap Coverage
If you are thinking about leasing or buying a car, you might
consider adding Lease Loan Gap (LLG) Coverage to your auto
policy. LLG Coverage is an extension of your auto's
physical damage coverage.
Ordinarily, your comprehensive and collision coverages
provide you with up to the actual cash value (the vehicle's
cost minus depreciation) in the event of a total loss. When
you sign a lease or loan agreement, you may be obligating
yourself for an amount higher than the vehicle's actual cash
value.
At a cost of approximately 5% of your current comprehensive
and collision premiums, LLG Coverage protects you from
out-of-pocket expense when such a "gap" occurs. Although
there are some limitations, LLG Coverage will pay up to your
lease or loan amount if your car is stolen or if the cost of
repairs is greater than its salvage value. Contact our
office and we'd be happy to discuss this coverage further.
Greenwood Insurance Agency,
330-637-7085
Note: Some car manufacturers may provide gap coverage as
part of the lease agreement --- check your particular
contract for details.
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New Car Selection:
Safety Counts
The Insurance Institute for Highway Safety has published a
shopping guide for those wanting to buy a new car based upon
safety features. While the guide does provide specific car
lists (from station wagons to sports cars) it also reveals
some overall safety basics to keep in mind.
Vehicle size - Quite simply, bigger means safer.
According to the shopping guide, "People in small vehicles
are injured more often and more severely than those in large
vehicles." In relation to their number on the road, small
vehicles account for more than twice as many occupant deaths
as large vehicles. Small sport utility vehicles have the
highest death rates of all, in part because of their greater
involvement in fatal rollover crashes. "While utility
vehicles and passenger vans might go head-to-head in a
popularity contest, passenger vans have good on-the-road
crash experience --- similar to that of station wagons."
Air bags - Serving as a buffer between vehicle
interiors and occupants' heads and faces, air bags provide
automatic protection in frontal crashes. The Institute
advises that although "the speed and force of air bag
inflation may occasionally cause minor injuries such as
abrasions, this slight risk is far outweighed by the
benefits." This type of injury can be reduced by selecting a
seat position that is not too close to the steering wheel.
Safety belts - Remember, the more comfortable the
safety belt, the more likely you are to always use
it. Even though shoulder belts allow some forward movement,
automatic crash tensioners and/or belt webbing grabbers can
reduce the chance of an occupant hitting the steering wheel
or dashboard in a serious frontal crash. And the law
requires seat belt usage, so avoid a fine.
Antilock brakes - Especially designed to avoid
skidding and loss of control, antilock brakes automatically
pump several times a second. Drivers need to become
familiar with the difference in braking style as antilocks
require heavy braking pressure to activate this safety
feature.
Head restraints - Required in the front seats of all
new passenger vehicles, head restraints prevent occupants'
heads from snapping back in a rear-end crash. Look for a
fixed head restraint or an adjustable restraint that is
designed to protect tall and short people even in the "down"
position. Avoid a poorly-designed adjustable restraint that
would only protect the shortest occupants.
Built-in child seats - Several cars and vans offer
built-in child safety seats as options.
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Ohio's Graduated Driver
Licensing Law
A graduated driver licensing law became effective in Ohio on
July 1, 1998. Designed to provide new drivers under age 18
with additional experience and skills when behind the wheel
of a motor vehicle, this law:
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Allows 15 1/2 year-olds to obtain
temporary instruction permits which are valid for one
year.
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Requires a parent, guardian or
licensed driving instructor to accompany the teen driver
at all times.
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Requires the temporary permit to be
held for a minimum of six months before a license may be
obtained.
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Requires permit holders to have 50
hours of driving experience, including 10 at night, with
a parent, guardian or licensed driving instructor.
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Also changes driver education
requirements effective January 1, 1999. New drivers
must have 24 hours of classroom and 8 hours of
behind-the-wheel instruction.
The Ohio Insurance Institute supports this
new graduated driver licensing system. Similar systems in
other states have reduced the number of crashes involving
teens. Call our office or stop by for your free copy of
The Driving Challenge - A Guide to Ohio's Graduated Driver
Licensing Law published by the Ohio Department of Public
Safety. Or for further information call the Department
directly at 1-800-462-2269.
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Uninsured Motorist
Coverage: Do I Really Need It?
You're driving your son to soccer practice when you are
rear-ended at a stop sign. Dealing with the initial trauma
of the accident and injuries and the subsequent disruption
of a period of medical recovery and the inconvenience of car
repairs is bad enough. What if the injuries are serious?
And what if the at-fault driver has no insurance? Where do
you turn?
This is where your Uninsured Motorists (UM) Coverage comes
into play.
What is UM Coverage? The Ohio Insurance
Institute defines it as coverage that "pays the policyholder
and passengers in his/her car for losses sustained by
reason of bodily injury ... caused by the owner or operator
of an uninsured automobile or a hit and run driver."
What is the difference between Uninsured and
Underinsured Motorists Coverage? Underinsured
Motorists Coverage covers you and passengers in your car for
"losses unpaid because sufficient bodily injury liability
limits are not available from the policy of an at-fault
driver." In other words, Uninsured Motorists covers
you if the wrongdoer has no insurance while Underinsured
Motorists covers you in the event that the wrongdoer has
some coverage but not enough.
Many people wonder if UM is really necessary. After all,
isn't liability insurance mandatory? How can there be any
uninsured drivers out there? The problem is not everyone
obeys the law. The Office of Public Safety for the State of
Ohio recently quoted to us in a telephone interview that 7%
of the drivers convicted of moving violations in a recent
six-month period were found to have no insurance. There are
upwards of 11 million automobiles registered in the State of
Ohio. If even 5% of them are uninsured, that's a
frighteningly high number!
Others question the necessity of UM in light of the fact
they have very comprehensive medical coverage. In the event
of an accident with an uninsured driver, they assume their
own medical coverage will fully protect them. Yes, medical
insurance would likely cover most medical expenses. But it
will not generally compensate the injured person for lost
wages, disfigurement, pain and suffering, mental anguish,
and changes in quality of life. For a person permanently
disabled following an accident, even things such as
modifications to make a home and a vehicle more accessible
can cost tens of thousands of dollars. UM can compensate
the victim in these broader areas.
There are ways insurance dollars can be saved, but paring
down or going without UM is one we strongly discourage.
The largest claim in our agency history is not a huge fire
loss or a big liability settlement. It is, you guessed it,
a UM claim.
Uninsured Motorist Property Damage Coverage
It is estimated that one out of every 20 motorists is
driving uninsured. Although this figure represents only 5%
of today's drivers, uninsured motorists are responsible for
approximately 13% of all auto accidents. If you become
involved in an accident with an at-fault driver of an
uninsured motor vehicle there are coverage options available
to ensure that you are adequately protected:
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UMBI-
Uninsured Motorists Bodily Injury Coverage provides
bodily injury coverage for you and for the occupants of
your vehicle. Most policies already provide this
coverage.
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UMPD-
Uninsured Motorists Property Damage provides coverage
for your vehicle. Vehicles without collision coverage
have no protection for damage resulting from an accident
with an uninsured driver. If the optional UMPD coverage
is added to your policy and you find yourself tangled in
an accident with the at-fault driver having no
insurance, you won't be left to pay for the damage to
your car out of your own pocket.
Please contact us if you want to check into
how your particular company's UMPD coverages are structured
and priced. Greenwood Insurance
Agency, 330-637-7085
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Tornado Damage? Is this covered?
Volunteer
Activities-Covered?
Earthquake, Flood and
Sewer Back-up
Your Home Business
Money Saving Tips
Covering Bizarre Losses
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Tornado Damage: Are you
covered?
Does windstorm include tornado?
Since the policy specifically refers to windstorm as a
covered cause of loss, some residents have wondered what
exactly windstorm includes. Tornadoes, hurricanes, high
winds, thunderstorms and blizzards are all included in the
definition of windstorm. Your homeowners policy also
provides 'loss of use' benefits to cover additional living
expenses while repairs are being made to your home.
Please call us with any specific questions regarding your
property coverage. We are always happy to review your
current coverage needs. Greenwood
Insurance Agency,
330-637-7085
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Volunteer Activities: Are
you covered?
You are a volunteer soccer coach, a 4-H advisor, a chamber
of commerce committee member, on the church board, or you
helped raise contributions for the last United Way
campaign. Perhaps you have volunteered hundreds of hours
this year without a thought of insurance coverage. If
someone is injured, who pays for any legal action brought
against you in these volunteer activities? If you serve as
a board member and are sued for breach of duty, imprudent
investments, discrimination in hiring or wrongful
termination, are you covered? To answer these questions,
there are two places to check: your home insurance and the
organization's insurance. Let's look at them:
Your homeowners insurance policy gives you liability
protection for bodily injury and property damage to others
in non-business activities, like a child who is injured when
you are the volunteer soccer coach or 4-H advisor. On the
other hand, no protection is provided if your volunteer
activity is related to a business (chamber volunteer, union,
trade or professional association representative, etc.) or
if you receive any compensation. Any legal action other
than bodily injury and property damage is not covered (an
exception: some homeowners policies cover personal injury
--- libel, slander, false arrest, false imprisonment, etc.).
Also check for coverage under the organization's policy. Ask
the organization leadership for proof of insurance for
general liability, directors and officers liability, and
employment practices liability. Also check to see if
volunteers are covered (named as additional insureds) under
those policies. Some other potential loss situations could
include:
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Failure to examine documents signed
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Silence with respect to improper
conduct of fellow officials
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Improper rejection of bids
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Failure to exercise diligence in
management
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Incurring unnecessary expenses
Communities are fortunate to have so many
volunteers donating their time in a host of different
areas. This discussion is not meant to discourage any
present or prospective volunteers. Rather, our intent is to
help individuals be well-informed, comfortable and
adequately protected when it comes to volunteering.
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Earthquake, Flood
and Sewer Back-up
While not wanting to dampen your anticipation of this
long-awaited season, it is a good idea to review some
optional coverages you may wish to add to your current
homeowners policy. Flood insurance as well as the sewer
back-up and earthquake endorsements are worth a brief
examination.
Flood- Since flood damage is excluded under your
homeowners coverage, you should be aware that flood
insurance is available from the National Flood Insurance
Program. Most Ohio communities have qualified for the
program that provides coverage for surface flooding only.
Structural and contents protection are offered. A $500
deductible applies.
Sewer Back-Up- This endorsement provides protection
for direct loss caused by water that backs up through
sewers, drains or sump pump wells. Just as flood insurance
excludes coverage for sewer back-up, this endorsement
excludes any coverage for damage due to flooding. Coverage
is subject to a deductible.
Earthquake- Coverage is available with the premium
determined by the structure of your home or building.
Because it will better withstand an earthquake, a frame
structure is less to insure than a masonry one. A
substantial deductible (often a percentage of the amount of
insurance that applies to the destroyed or damaged property)
is in effect.
For clarification of your current policy or information
regarding the above coverages, please contact us. We welcome
the opportunity to evaluate your present needs and to
discuss possible insurance improvements for you and your
family. Greenwood Insurance Agency,
330-637-7085
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Your Home Business:
Know Your Coverage
Test your knowledge of your homeowners insurance:
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Are you
covered? |
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While caring
for a child for a fee, the child is injured
in your home. The parents expect you to
cover the hospital bills. |
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You replace
your friend's car brakes for a "few bucks"
and the car is damaged or your friend is
hurt in some way. He expects compensation. |
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A friend
slips on an icy walk or trips on a toy while
picking up the craft item she paid you to
make. She expects you to cover medical
bills. |
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You use your
detached garage for a small woodworking
business and the garage is damaged in a
windstorm. You want your garage rebuilt. |
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You do word
processing for a fee from your home. Your
computer is stolen. You want it replaced. |
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You are a
self-employed sales representative with an
office in the home. While entertaining a
client in your home, the client is injured
and expects compensation. |
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In each situation described, the answer is probably "not
covered" --- unless you have added specific coverage to your
policy for this home business. Take away the compensation,
or business aspect, and each would probably be "covered".
Situations like those described can be covered in one of
three ways:
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Your employer may cover it if your
business is conducted on behalf of your employer.
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A business insurance policy may be
purchased to cover it.
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Your home insurance policy can
sometimes be broadened to cover it.
If you have any concerns about a
business-type activity in your home, call us. We'll be happy
to discuss it with you. Greenwood
Insurance Agency,
330-637-7085
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Money Saving Tips
Controlling household expenses is something we all try to
do. We want to help you reduce your home insurance costs
when possible. Here are some points to consider:
Smoke alarms. Check your policy or contact us to see
that you are receiving a discount. If you don't have
alarms, get them. Not just for the discount, but for your
family's safety.
Higher deductibles. The standard deductible today is
$250. If yours is lower, you are paying an added charge.
If you choose a $500 or higher deductible, more savings are
available.
Delete unneeded coverage. Review your policy. There
may be jewelry listed that has since been sold, endorsements
for businesses in the home that are no longer in operation
or other unnecessary coverages.
Central station alarms. Fire and burglary alarm
systems that automatically dial a central station can
provide both good security and a significant premium
savings.
Combine home and auto insurance in one company.
Companies often offer a discount on the home and auto
insurance or both when carried by the same insurer.
In addition to these money-saving tips, some companies offer
discounts if you have fire extinguishers, deadbolt locks or
a loss-free record. Check with us to see if your plan
offers any of these options.
Remember, under insuring is not a recommended way to save
premium as it can lead to serious problems settling a claim.
Whether it's a question about cost or coverage, we're always
willing to review any insurance concerns with you. Please
call us. Greenwood Insurance
Agency, 330-637-7085
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Homeowners Insurance: Covering the
Bizarre Losses
Just how broad is your insurance coverage? Will it cover
sunken tractors? This true story has occurred several
times: our client parks his riding mower on a hill,
dismounts, and the tractor slips out of gear and rolls into
the pond. Covered? Only if you have an HO15 endorsement on
your policy.
You don't have a riding mower or a pond you say? The HO15
endorsement broadens a homeowners policy so that it also
covers other personal property lost due to extraordinary
situations. Consider these other covered losses:
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Lost jewelry or gemstones falling out
of jewelry not specifically insured (subject to a policy
dollar limit).
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Loss in value when a gemstone is
scratched or cracked (subject to a policy dollar limit)
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Cameras or other personal items
falling overboard from a boat or a capsized canoe.
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A hot iron falling on and scorching
an area rug.
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A deer crashing through a sliding
glass door causing extensive damage to household
contents as it struggles to deal with the unfamiliar
surroundings of a family room.
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Raccoon damage (rodents and vermin
are not covered).
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Lost hearing aids, eyeglasses,
telescopes, cameras, etc.
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Spillage of paint, India ink, nail
polish, acid, bleach, and other chemicals that damage
household contents.
Most home insurance policies list 17 or 18
different perils of coverage for household contents that do
not include the above or numerous other bizarre
possibilities. The H015 will cover most of these ---
subject to your policy deductible.
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Be a Fraud Buster!
Fraudulent insurance claims cost us all money. Toll-free
numbers are available for reporting information concerning
fraudulent insurance claims. The caller's identity is kept
confidential and an individual may talk with a trained
investigator or leave information anonymously on a telephone
answering machine.
Funds spent on fraud detection are a good investment.
According to the National Insurance Crime Bureau, the
property/casualty industry is recovering $3.50 for every
$1.00 it invests in detecting fraud.
If you want to report insurance fraud, please call our
office. You can also contact the National Insurance Crime
Bureau at the number shown below. Be a fraud buster. We can
all help fight insurance fraud.
NICB Fraud Hot-Line: 1-800-TEL NICB
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With costs approaching and frequently exceeding $30,000
annually, this is an area of concern to all, especially
those who have been successful in accumulating significant
assets.
Extensive planning is often done to conserve these assets
and protect them from high estate taxes. It is equally
important to consider the effect a long-term stay in a
nursing home can have on an estate. Death taxes and a
long-term illness can exhaust accumulated assets. To avoid
having to "spend down" assets before government programs
(Medicaid) will pay for long-term care, a long-term plan may
be purchased that will provide the dollars necessary for
care. As with most types of health insurance plans, the
premium increases as we age and the risk increases. The
following chart shows representative annual premiums for
$100/day, 60-day waiting period, 5% compound inflation
benefit at various ages.
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Issue age 50 - $ 552/year
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Issue age 55 - $ 723/year
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Issue age 60 - $ 993/year
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Issue age 65 - $1437/year
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Issue age 70 - $2097/year
Other optional benefits such as home health
care are available for an additional premium. As in any
estate planning situation, with long-term care the earlier
one starts in planning the solution, the lower the cost.
Individuals who have been successful in accumulating an
estate should be careful in planning for estate taxes and
long term care costs. We would be happy to talk with you
about the need, the benefits and the costs as they would
apply to your situation. Please give us a call.
Greenwood Insurance Agency,
330-637-7085
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Why have it? What is it? Who needs it?
Skyrocketing court settlements and medical costs can cause
uneasy feelings about the adequacy of insurance protection.
Liability insurance pays for injuries to others due to
negligent acts by you or another covered person on your
policy. Although the liability insurance provided under a
home or auto insurance policy is adequate for most
situations, in a few instances large lawsuit settlements do
approach or exceed the limits of these policies.
An umbrella liability policy is designed to give you peace
of mind from this concern. It adds one million dollars (or
multiples of $1 million) of protection to the liability
limits of your home and auto insurance policy. * Should a
judgment against you exceed the limits of that policy, the
umbrella picks up the unpaid portion up to the umbrella
policy limit.
Persons most likely to purchase an umbrella policy are:
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"Likely "targets" for a large
lawsuit--professionals, business owners, property
owners, higher income individuals, etc.
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Those who want greater peace of mind
knowing that their life savings will be protected from a
financially devastating lawsuit.
Coverage cost varies, but it is generally
$115 to $150 per year for a $1 million limit. If you would
like more information on this topic, please call us. We
will be happy to discuss it with you.
Greenwood Insurance Agency,
330-637-7085
*The umbrella can
also increase the liability limit for your boat, rental
property, motor home, recreational vehicle, motorcycle,
vacation home and others.
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330-637-7085
3645 State Route 5,
"Where customers become friends..."
Cortland, Ohio 44410
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