Let’s face it, insurance can be confusing. Many of you reading this may not understand the policy you have, and more importantly, may not have a proactive agent working on your behalf. In today’s marketplace with many local agencies being bought up by out of state venture capital and online companies hiring relatively unseasoned help, it can be difficult to get good advice. The lowest cost policy could be the costliest in disguise. After all, you wouldn’t go to a drive thru for your next physical. Instead, you’d schedule an appointment to meet one on one with a reputable, licensed, and educated medical professional to advise you on next steps. The same can be said here: if you don’t KNOW insurance, KNOW your agent!
I explain to my clients there are 3 values when looking at a building:
The Market Value - What someone is willing to pay to purchase it
The Assessed Value - What the town will tax you based on
The Replacement Value - What it would cost today to rebuild your property
With building costs literally through the roof, it’s time to review what you have in place for your property. Why you ask? Property insurance policies have a co-insurance clause which will substantially reduce the claim payment if your property is insured for less than 80% of its current replacement value. This clause can cost you $1,000s and agents today aren’t talking about it.
The mechanisms in the policy meant to keep pace with inflation have not done so. Insurance companies include an Inflation Guard rider in their policies which will automatically increase your building coverage by a set percentage, usually 4%, each year the policy renews. Unfortunately, that percentage has not kept pace with where costs are now. As a result, we are seeing many insurance carriers increasing the inflation guard riders on their policies at renewal, some at 8%, others even higher at 11%. This will result in a bump in coverage and subsequently pricing on your home or building insurance with little to no warning. Adding more salt to the wound, that bump will occur in each year subsequent year. While this helps get the coverage more in line with recent trends over time, it is a reactive approach to your insurance needs.
We are not a reactive agency . . . For those of you who do not know me, my name is Michael Hughart. I am a Senior Account Executive at Kinney Insurance Agency and I’ve been helping people like you for nearly 16 years. I work with both Business and Personal clients identifying and advising them of their risks, while leveraging our carrier partners to provide a cost-effective solution. As trusted advisors our work does not end there. Our team conducts regular reviews with our clients ensuring the programs, we put in place stay up to date and remains the top strategy. If you have not heard from your agent in the last couple years, call us. We’re here to help.