Our March News & Happenings

March brings longer days and hopes for some warmer weather. We have some essential items regarding current and upcoming insurance risks. Take a quick read about how to protect yourself further.

IN THIS ISSUE:

1. Our new Magazine!

2. Snow Melt & Flood Insurance

3. Inflation & Economic Volatility

4. Life Insurance

OUR MAGAZINE!

Spring brings change, and change we did. We now have our very own business magazine. We send it out bi-monthly. Please let us know if you would like to receive one. They are great to have in your waiting room at the office or on the coffee table at home.

For our clients, I would love to feature you in the magazine. Let me know if you have something you'd like published. It can be anything from business, ranching, home & family, non-profits, and more. Let me help promote you!

SNOW MELT & FLOOD INSURANCE

Do you have mounds of snow behind your home? Do you live near river bodies? We could see Ice Jams, which divert the water where it usually would not flow. Heavy spring rain and fast melt, snow has to go somewhere, and I hope it isn't into your buildings. Look around your neighborhoods, especially those with a lot of new development. With the change of the land, the water will flow differently. Get ahead of the melt and consider flood insurance. We offer both FEMA and Private Programs. It is great peace of mind to have coverage in place. Let me help you navigate your risk of potential flood damage. FEMA has a 30-day waiting period, and the Private Program has a 15-day wait Let's chat soon. A phone consultation usually will take about 15-20 mins of your time.

307-655-8001x3 and ask for Jessica.

INFLATION & ECONOMIC VOLATILITY

We have received calls about increasing insurance rates during the "covid" era. Many of our clients didn't turn in claims. Nothing changed, except higher premiums. Sadly, every single account we have has increased. I wish I could say we have a magic button on the computer that lowers it down, but we are not gifted that by the insurance companies. I want to share some key points to consider. The following are ideas to help lower your premiums back to better rates. If they apply to you, please call us so we can work on your behalf.

1. Did your credit score improve? If so, this is a substantial contributing factor to lower rates. Some companies do not re-run your credit score at renewals; this process is manual. Contact your agent to ask for the form to sign to approve the credit authorization.

2. Did you update your home?

   1. New Hot Water Heater?

   2. New Furnace?

   3. New Roof?

3. Do you bundle your home and auto with us?

   1. Many carriers provide significant discounts for doing so

   2. Your total out-of-pocket is significantly lowered during a loss IE: Single Peril Deductible - Let's chat more about this

4. Smart Driving Discounts - Up to 30% off based on driving habits.

5. Home Reconstruction Costs - You might notice a significant increase in Coverage A - Dwelling limit, from last year. This is to protect you from the massive inflation we saw with covid. Let's see what your reconstruction cost is today and possibly see if it makes sense to lower it back down. We will compare it to what we had last year, and make an informed decision to decrease or leave it alone. Coverage A - Dwelling is the driving factor behind your homeowner's premium. A review is healthy. Please consider one in 2023.

I've included a link to the market analysis that explains what the industry finds as driving factors in insurance rate increases.

Market Analysis

LIFE INSURANCE

This is the #1 protection you can provide your family or business. We all have had loved ones pass early, suddenly, or know of a friend or acquaintance that has. It's shocking; sometimes, lack of planning has left their family or business in despair. Please let us provide you with this critical coverage. This includes coverage for stay-at-home spouses, not just those who produce income. Becoming terminally ill has left families in bankruptcy because the co-insurance on hospice or hospital stays can be exponentially expensive.

A quote can be your tool and guide in budgeting your income to allow for this expense. We offer term life, whole life, annuities, and business key person, and if you need group protection, we also have those programs available. Please reach out to us. We are here to help you find coverage that fits your current and future financial well-being.

CONNECT WITH US

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Our February 2023 Newsletter

In this issue

• Last Minute Valentines Outings

• Easy Plumbing Fixes

Last Minute Valentines Outings

Love and restaurants, bars, and other indoor locations are in the air. While you might have ventured inside for a candlelit dinner last year, your options were probably limited. This time should be different, even if you're just now making plans.

If you're staying warm and cozy, try these romantic ideas:

• Ice Skating - Indoors doesn't have to mean warm! Try a skating rink for some winter fun.

• First Date Revisited - Wow, your date will love returning to the place you first met - unless it's an embarrassing story.

• The Hard to Get - Don’t miss the restaurant you've been dying to visit. Use an app like Open Table and find an early or late seat.

• Two by Train - Go "All Aboard" and take a last minute day trip via loco-motion.

Easy Plumbing Fixes

We know that every plumber reading the subject line spat out their coffee in disgust.

And for a good reason! Plumbing is no joke. But that doesn't mean you can't get a little hands-on.

Even if all that means is knowing what to do in the event of a plumbing emergency, here are some helpful tips for getting hands-on:

• Snakes Ahoy - For a sluggish drain, use a snake - a device used for just such occasions.

• Elbow Grease - Leaky pipe? Check to see if the line needs to be tightened.

• Tape It - A short-term fix is a waterproofing tape to plug that hole until real help arrives.

• Deep Trouble - Clogged toilets usually yield to a plunger's gentle use. Emphasis on gentle!

When in doubt, watch a video on YouTube. When in real doubt, call a plumber!

Actual Cash Value vs. Replacement Cost - What's the difference?

My oh my... a HUGE difference!

These little acronyms (ACV & RCV) make up for some heated claim situations. What do they even mean? Let me explain.

Agents must come up with a rough estimate for reconstructing their client's dwelling or building before submitting it to the insurance company for pricing and policy issuance. Depending on how thorough the agent is, the closer and more accurate the estimate for rebuilding will be. We (insurance companies, adjusters, and agents) use a software program called Marshall & Swift Boeckh or MSB program (Corelogic). It is a cost-estimating software that, when imputed with structure features including but not limited to the substructure to the roof covering, your specific location (which could estimate higher due to travel for a contractor, materials, etc.), the program then calculates with all overhead, architectural fees, engineering, labor, materials - today's cost to rebuild your structure. This does not include the contents within. Only items that are permanently installed. (That is another topic!)

Why did I mention this process? It's a critical and fundamental step to insuring a structure and for you to understand how ACV and RCV come into play.

ACV = Actual Cash Value or "Depreciated Value."

RCV = Replacement Cost Value or "Without Depreciation."

ACV Situation:

Your insurance policy will pay to replace or fix the structure. However, they WILL SUBTRACT money due to the age of the structure, wear and tear, etc. Why is it applied to policies? Some property features require it. It might not be favorable, insurable, aged, or poor repair, or the agent undervalues the property with the client's approval.

(Photo credit to Corelogic)

RCV Situation:

Your insurance policy will pay to fix or replace your structure but WILL NOT subtract money because of age, wear and tear, etc. This is the most common and desirable outcome with your property insurance. As long as the property is in good repair, within the appetite of the insurance company, and valued appropriately, underwriting has approved it to be insured; you will receive Replacement Cost Valuation. There are exceptions to this, but you could expect RCV in most cases.

The difference could be a large sum of money. Let's look at an example.

Your home's current replacement value today is set at $450,000. If you had a total loss, you could expect to be paid $449,000, assuming you had a $1000 deductible.

In the ACV scenario, a depreciation of -$169,186 is due to poor repair, or undervaluation by the agent/client, leaving you with only $279,814 (less the $1000 deductible) to rebuild your 4-bedroom home. In 2023, it would be very tight to build a 4-bedroom home for $279K.

The policy lists $450,000. However, it doesn't always mean $450,000. We joke about reading your policy when you can't sleep at night, but you should read your policy every morning with a cup of coffee. It's a great way to start the day! (In my humble opinion)

The basics of understanding those differences are essential to the property owner. Other policy features are taken into consideration during a loss, like co-insurance, endorsements, and exclusion, but for this post, we are simply giving an example of ACV vs. RCV.

Guess what? We didn't discuss Market Value!! That, my friend, is for another discussion. Please click here if you wish to read more about Market Value vs. other valuations.

ACV and RCV are solely focused on rebuilding the existing structure with or without depreciation. So, when you see ACV, pick up the phone, give your agent a call and have a chat. If it cannot be changed, at the very least, you will not have any surprises during a claim!

Thanks for reading!

Jessica J Weaver, CIC

Agency Owner