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ARE YOU 100 PERCENT COVERED?
NEW YORK, NY -- Kiplinger’s Personal Finance reports that Marshall & Swift/Boeckh, a company that compiles construction cost data and provides software to help insurers estimate replacement value, found that up to two-thirds of homes in the U.S. are underinsured, by an average of 27 percent. The figures highlight the need for homeowners to make sure they have enough coverage on their homes to replace them if they are destroyed. One problem is that many homeowners who have replacement cost coverage mistakenly believe they will receive enough compensation from their insurer to replace a home no matter what. This is the case if coverage is up to date, but if homeowners have remodeled or added an addition and failed to bump up their insurance limits, they could receive less money than needed to rebuild. This consumer article explains one way to estimate a home’s current value and advises homeowners to buy policies with an annual inflation adjustment provision (or an endorsement) only if it is tied to regional, rather than national, building costs and to purchase “extended coverage,” which provides a buffer of 20 percent or more above replacement value coverage, if it is available.
IGNORANCE IS NOT BLISS WHEN IT COMES TO KNOWING CREDIT SCORE
WASHINGTON, D.C. -- USA Today advised consumers this week that credit scores can have an influence on everything from mortgage interest rates to auto insurance premiums. However, two recent surveys highlight most consumers’ lack of information about and understanding of the scores. One is a recent survey by TrueCredit.com, which found that only one American in 10 knows his or her score, and the other is a Consumer Federation of America survey, which found that four Americans in 10 didn’t even know that they could improve their scores by paying off large balances on credit cards, among other things. The article briefly explains how the scores work and provides tips on how consumers can improve their scores.
HEAVY RAINS PUT CALIFORNIANS AT RISK FOR FLOODS AND MUDFLOWS
WASHINGTON -- Recent severe storms have brought an early start to California's rainy season and have put areas already ravaged by past year's wildfires at particular risk. Residents living near wildfire burn areas are especially vulnerable to flooding and to mudflows that occur when fire-scorched earth saturates, liquefies and gushes down hills.
"California's winter rains can be sudden and surprisingly intense," said Under Secretary of Homeland Security for Emergency Preparedness and Response Michael D. Brown. "Residents should know how to prepare for these storms, and should be aware that their homeowners insurance does not cover flood and mudflow damage." Flood insurance policies offered through the National Flood Insurance Program do cover damage from both flooding and mudflows. However, it is important to act now since there is a 30-day waiting period with new flood insurance policies.
No California county is immune from the risk of flooding. In the past 10 years alone, there have been three large scale, widespread, federally-declared flood disasters in California. And the risk could be higher than usual this year for the southern part of the state. The National Oceanic and Atmospheric Administration warns that an El Nino may bring heavy rains to Southern California this winter.
To help teach consumers how to protect their homes and property against flooding, the Department of Homeland Security's Federal Emergency Management Agency (FEMA) is sponsoring the FloodSmart campaign. Consumers can learn more about their flood risk and the protection offered by flood insurance at http://www.floodsmart.gov, or can call 1-800-427-2419 to locate a nearby insurance agent.
Under the National Flood Insurance Program, federally backed flood insurance is available to homeowners, renters and business owners in communities that adopt and enforce floodplain management ordinances to reduce future flood losses by regulating new construction in high flood-risk areas. Currently, more than 4.4 million flood insurance policies are in approximately 20,000 participating communities nationwide, representing nearly $637 billion worth of coverage. The National Flood Insurance Program is self-supporting; claims and operating expenses are paid from policyholder premiums, not taxpayer dollars.
On March 1, 2003, FEMA became part of the U.S. Department of Homeland Security. FEMA's continuing mission within the new department is to lead the effort to prepare the nation for all hazards and effectively manage federal response and recovery efforts following any national incident. FEMA also initiates proactive mitigation activities, trains first responders, and manages the National Flood Insurance Program and the U.S. Fire Administration.
MOTORING DEATHS DROP FOR THE FIRST TIME IN SIX YEARS; SEAT BELT USE IS CITED
NEW YORK – A story in the New York Times reported this week the National Highway Safety Administration said that the total number of motor fatalities in the U.S. declined in 2003, after five consecutive years of steady increases in the death toll on the nation's highways. The number of deaths per miles traveled fell to a record low and the number of injuries also declined. The improvement is attributed primarily to greater use of seat belts. While fewer vehicle occupants and pedestrians were killed last year, the number of motorcycle fatalities increased by 12 percent. The latest death toll from motorcycle accidents was 73 percent higher than in 1997. The trend reflects the increased popularity of motorbikes along with the declining use of helmets. Jeffrey Runge, the highway safety agency's chief administrator, said that the 42,643 deaths on the nation's highways last year, adding that more needed to be done to improve safety.
FEAR OF SCHOOL SUITS HAUNT TEACHERS AND ADMINISTRATORS
WASHINGTON, D.C. – An article in the National Law Journal reported that a Harris Interactive poll of public school teachers and principals from around the country found that 82 percent of the 800 respondents agreed that the fear of being sued has created a defensive teaching mode. The poll also found that 62 percent of principals who responded said that they had been threatened with lawsuits by a parent. Nancy Udell, general counsel and policy director for Common Good, a bipartisan group dedicated to reforming America’s lawsuit culture, says that suits run the gamut from complaints over poor grades to charges of excessive punishment to anger over children not being chosen for extra-curricular activities. The article discusses a few cases and their outcomes. Perry Zirkel, a professor at Lehigh University who has tracked suits against schools over the past 60 years, disputes the contention that they are on the rise. Zirkel’s research found that such suits actually peaked in the 1970s and have been dropping since. He also says that the vast majority of these suits have been won by the schools.
PANEL FINDS MOLD IN BUILDINGS IS NO THREAT TO MOST PEOPLE
NEW YORK -- The New York Times reported that on May 25 a panel of the Institute of Medicine, part of the National Academy of Sciences, reported that toxic mold in homes was not likely to cause serious health problems for most people. The panel of epidemiologists, toxicologists and pediatricians said that respiratory problems and symptoms of asthma in some cases could be linked to mold and dampness, but the panel found no evidence that neurological damage, reproductive problems or cancer could be associated with mold. Although the government experts reviewed hundreds of scientific studies, they agreed that the research was limited and more studies were needed. The study comes amid increasing public concern and litigation about health problems linked to mold. U.S. insurance companies paid approximately $2.5 billion in claims related to mold in 2002.
10 TIPS FOR SUV SAFETY: PASS IT ALONG
PLEASANTON, CA - A recent story on the website http://www.Bankrate.com featured the following tips for SUV drivers. With the summer driving season starting, the WI was inspired to pass these suggestions along so you could share them with your auto insurance customers.
According to the story, many drivers mistakenly assume that SUVs are safer than cars. On June7 the National Highway Traffic Safety Administration released the results of a series of new rollover tests conducted on 17 passenger cars, six sport-utility vehicles (SUVs), three pickup trucks, and one minivan. The federal agency reported that four popular SUVs tipped over in the tests -- the rear-wheel-drive version of the Ford Explorer, the Chevrolet Tahoe, the GMC Yukon and the rear-wheel-drive version of the Mercury Mountaineer. The results confirm experts’ concerns that consumers are not fully aware of the safety problems related to SUVs and pickup trucks, which ride higher than passenger cars.
Steve Mazor, principal automotive engineer for the Automobile Club of Southern California, says SUV problems are not limited to the hardware -- operator error also plays a significant role. "Drivers have got to avoid what I call a 'road warrior' mentality," explains Mazor. "Some SUV drivers believe they can ignore common rules of caution because they're protected by a bigger vehicle. What they seem to forget is that SUVs, minivans and pickup trucks have different handling characteristics and overconfidence on the part of drivers can lead to serious consequences."
But the grim stats from crash studies indicate otherwise. Says Russ Rader, a spokesman for the Insurance Institute for Highway Safety, "Pound for pound -- when you compare SUVs with vehicles of a similar weight -- SUVs tend to be less safe than cars."
But here are 10 safety tips for SUV drivers:
• Learn to drive it. Just because your state allows you to drive SUVs without added training doesn't mean you're qualified. Practice driving in an empty parking lot or other open space under different conditions to get used to the brakes, steering and overall handling.
• Avoid sudden or sharp steering changes. Recognize an SUV is not designed to make fast, sharp turns, and it handles differently than a low-slung sports car or the family sedan.
• Consider other drivers. While your driver's position may have been improved -- allowing you to see farther ahead -- drivers behind and alongside you can see much less. Drivers behind you cannot see 'through' your windshield. They are driving blind to a certain extent and have much less warning that you're going to stop -- making you more likely to be hit in the rear. Be aware of all the vehicles around you in traffic, especially the smaller ones.
• Recognize visual limitations. Many SUVs are equipped with dark-tinted windows, making it difficult for an SUV driver to know what's traveling alongside or behind. Check your SUV's mirrors to make sure they minimize your blind spots on either side. Because of the SUV's width, the mirrors may require a more outward adjustment. The adjustment may also help to spot smaller vehicles more readily.
• Brake better. SUVs often require greater braking distance than automobiles, especially in bad weather. Choose a vehicle with anti-lock brakes and use them properly -- maintaining firm and constant pressure on the brake pedal, not the 'pumping' technique for older vehicles.
• Buckle up. It's clear that with the rollover issue, SUV drivers should be especially careful to wear seatbelts.
• Slow down. Most people, not just those who own SUVS, drive too fast. Drive defensively. It gives you more time to react in an emergency.
• Avoid overloads. Remember that cargo or even passengers further raise the center of gravity, so slow down even more when the vehicle is full.
• Don't carry too much weight. Overloading also causes wear and tear to brakes, and can overheat tires, increasing the risk of a blowout.
• Maintain regularly. Have the vehicle serviced periodically and pay close attention to your tires and tire pressure. Under-inflated tires can contribute to blowouts.
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