There are so many things that should be considered before you purchased insurance. For example; you already know that every community has building ordinances or zoning laws that affect how houses are built or updated. But did you know that there are also laws and ordinances that govern how or whether a house can be repaired after a loss? When you have a loss that damages part of your house, the repairs, in many situations, must be made to the specifications of any regulations that are in effect at the time of the loss. It doesn’t really matter if everything met code when your house was built. What matters now is the new building code. Even more important than that, there are regulations that may compel you to tear down the house if the damage is more than 40–50 percent of its value. You’re probably thinking: “So how does that affect me? Isn’t that what insurance pays for?" Well…the answer is yes and no at the same time! Insurance pays for the cost to repair or replace the damaged part of the building. Think of it this way: if the value of your house is $200,000 and you have $100,000 in damage, insurance pays for the damage (minus your deductible, of course). But now that your house has sustained damage equal to 50 percent of its value, the law kicks in and requires you to tear it down—damaged and undamaged parts—and rebuild the whole thing! Now, since insurance pays for the damaged part of the building, but even the undamaged part has to be torn down, where does the other $100,000 come from? Well, that’s where Ordinance or Law coverage comes in. There are very few total losses; partial losses are far more likely. But a partial loss could trigger the enforcement of an ordinance or law that could cause you to have to pay more than the amount of loss covered by your policy. Additional coverage may be purchased that would help pay for the value of the undamaged part of the house and the increased cost to rebuild according to the new code. Replacement value doesn’t mean upgrade cost what if this happened to you…A fire causes major destruction to your building. Because more than 50% was damaged, a local by-law requires the building to be torn down and rebuilt to current building codes. You’re a responsible person and take the necessary steps to maintain your property. You have replacement cost value on your policy, so you’d be fully covered…right? Not necessarily. Property insurance policies generally have an “Ordinance or Law” exclusion, which means that the policy covers the building as it exists, but it does not cover the cost to upgrade the building to current building codes and ordinances after a loss. Therefore, having “replacement cost” coverage for your building does not mean that you have “upgrade cost” coverage, unless you purchase an “Ordinance or Law endorsement” for your property. Even if a property policy offers some built-in Ordinance or Law protection, often the amount of coverage isn’t sufficient in a major loss. Building codes and zoning laws affect every piece of property no matter how big or small. These laws are continually changing…requiring new or improved features such as better wiring, handicap access, sprinkler systems and more. If a loss situation triggers code upgrades, it could be financially devastating unless you have Ordinance or Law coverage. While some regard this coverage to be important only for older buildings, laws are always changing, and newer buildings can be affected. This is an area of concern for all building owners. How ordinance and law coverage protects you:
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As hurricane season approaches we want to remind you that hurricane preparedness is of the utmost importance. Hurricane Sandy, the second costliest storm in U.S. history causing an estimated $50 billion in damage certainly show how devastating a storm can be and reminds us that we should not be complacent, but be prepared for severe weather events. We urge you to take the time to put together your personal hurricane kit to protect your family and property in the event that a storm impacts us this year. In addition to preparing for the safety of your family, it is a good time to review your homeowners policy with us to make absolutely certain that you have the coverages you need to protect your property. Replacement Cost - the differences between the replacement cost of your home and its market value in today's economy is a prevalent topic of discussion. With today's depressed market values, it i even more important that your Homeowners Coverage A limit is insured for 100% of the replacement value of your home. Deductibles - your homeowners policy has two deductibles, one for 'all other perils' (AP) and one for 'hurricanes' or it may be for all 'wind damage.' Your MPIUA policy will have a higher deductible for any 'wind' damage. But your UPC Insurance policy would have a 'Hurricane' deductible that applies only during a 'named hurricane.' Otherwise, your lower 'all other perils' deductible would be applied. Flood - we want to remind your that your homeowner's policy does not cover flood. Should a storm occur and your property becomes flooded, in order for you to have coverage you must have a separate flood policy. 3x TIMES the MONEY that CALFEE raises will go to 'ONE FUND' So here's the scoop- The Arthur D. Calfee Insurance Agency, Inc. is proud to join the business community to support those most affected by the tragic events at the Boston Marathon. The Arthur D. Calfee Insurance Agency, with offices located in the Homeport Office Complex at 336 Gifford Street in Falmouth and across the street of the North Falmouth Ball Field at 121 County Road will be raising money for the Boston Strong - 'One Fund.' From now, April 29th to June 1st, 2013, the Arthur D. Calfee Insurance Agency will be raising 'One Fund' to turn in to 'One' large supporter who has agreed to match 3x TIMES the amount raised by Calfee Insurance, meaning they will match donations on a $3 to $1 basis up to $1,000 in total from the supporter. Massachusetts Governor Deval Patrick and Boston Mayor Tom Menino have announced the formation of 'The One Fund Boston, Inc.' to help the people most affected by the tragic events that occurred in Boston on April 15, 2013. AP | By LINDSEY TANNER Cost of amputating a leg? At least $20,000. Cost of an artificial leg? More than $50,000 for the most high-tech models. Cost of an amputee's rehab? Often tens of thousands of dollars more. These are just a fraction of the medical expenses victims of the Boston Marathon bombing will face. The mammoth price tag is probably not what patients are focusing on as they begin the long healing process. But friends and strangers are already setting up fundraisers and online crowd-funding sites, and a huge Boston city fund has already collected more than $23 million in individual and corporate donations. No one knows yet if those donations – plus health insurance, hospital charity funds and other sources – will be enough to cover the bills. Few will even hazard a guess as to what the total medical bill will be for a tragedy that killed three people and wounded more than 260. At least 15 people lost limbs, and other wounds include head injuries and tissue torn apart by shrapnel. Please visit www.CalfeeInsurance.com for more details. Wind deductibles from $500 - $2,500 Special Tree Removal Protection Ultra Coverage Program Never get a late fee again! Sign up for Automatic Payments online through UPC Insurance.
By Todd Wallack | BOSTON GLOBE STAFF JANUARY 28, 2013 Competition in the state’s car insurance market has yielded an unexpected benefit: Thousands of residents who once had to buy expensive home coverage from the Massachusetts FAIR Plan are increasingly able to find policies through other insurers, saving them hundreds of dollars a year on premiums. The FAIR Plan, known as the insurer of last resort, provides home insurance in high-risk areas, including neighborhoods that have high crime rates or sit perilously close to the ocean. Home insurance companies have traditionally been reluctant to do business in such locations. But since the state gave insurers more freedom to set their own auto insurance rates, starting in 2008 — something it calls “managed competition” — 13 more auto insurance companies have set up shop in Massachusetts, with most also selling homeowners policies or partnering with firms that do. Over that time, the FAIR Plan lost nearly 27,000 homeowners insurance customers, or 16 percent of its base, an exodus few in the industry predicted. “It is all driven by this shift in the competitive marketplace,” said Robert Tommasino, general counsel for the Massachusetts Property Insurance Underwriting Association, better known as the FAIR Plan.
Some insurers, including Narragansett Bay Insurance Co., also decided the escalating prices of premiums for coastal properties made it worth their while to start selling policies in those locations. Their strategy has been to undercut the FAIR Plan rates while still charging enough to turn a profit. Bob Inello, whose waterfront home in Nahant is exposed to the wrath of storms, said he was forced to buy Fair Plan coverage for more than a decade. But three years ago, Inello said, his agent said he could switch to Narragansett, cutting his bill by $570 a year — more than 20 percent. “I don’t feel like I am being held hostage anymore,” Inello said. “It’s very liberating.”
The risk of catastrophic loss during hurricane season requires an innovative approach to property coverage—and a rapid response when losses occur. For over 40 years, Lexington Insurance Company has helped our brokers and clients prepare for, protect against, and recover from catastrophic losses. We are the leading U.S.-based surplus lines insurer, and a property and casualty market leader. Make sure you’re a step ahead of risk this hurricane season. Watch LexTV for the latest on hurricane risk and coverage solutions. Hurricane 2012 Update Dr. Phil Klotzbach updates his 2012 seasonal hurricane forecast and shares his outlook for the remainder of the season. This episode also introduces Lexington's new Hurricane Infographic which will help streamline the understanding of a hurricane event. |
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