How to Choose the Appropriate Home-Based Business Insurance

How to Choose the Appropriate Home-Based Business Insurance

It isn’t hard to see why home-based businesses are becoming increasingly popular as time goes on. They’re inexpensive, simple, and have a number of benefits and write-offs that can be taken advantage of come tax season. Unfortunately, recent estimates reveal that most home-based business owners are grossly under-insured –  and that’s a big problem. A lot of people who start these businesses are under the impression that since the business is located within the home, their homeowners insurance policy will cover their business as well. What some unfortunate folks have discovered, though, is that this is not the case. Regardless of the fact that your business is located in the home, separate business insurance coverage is still necessary. Fortunately, there are several affordable policies available for home-based businesses of all sizes. The most basic form of business insurance for a home-based business is going to be a homeowners insurance rider. These are often the cheapest type of business insurance you can get, and they don’t cover much. The coverage amount will vary, but it typically runs between $2,500 to $5,000. The rider’s primary purpose is to cover equipment and provide a little coverage for liability as well. It will not cover things like loss of income, workers’ comp., or other potential issues. The next step up in home-based business insurance would be a home office policy. This policy provides the protections listed above as well as protections for lost income, business liability, theft, personal liability and fire. A home office business insurance policy usually won’t cover damaged or lost inventory. Finally, there is the business owners policy, or BOP....
If You’re Buying A Home, Be Cautious When It Comes to Seller Rent-Back

If You’re Buying A Home, Be Cautious When It Comes to Seller Rent-Back

So you finally bought your dream home, but now the seller wants to rent it back from you. What do you do? You could always say that you promised the local Boys & Girls Club that they could hold a fundraiser there next week. But chances are, the seller wouldn’t believe that. Some sellers put this rent-back option in their sales contract. From their standpoint, it can be a useful option because sometimes the home a seller plans to move into isn’t available yet. And you may have signed this clause as part of the purchase agreement when you bought the home because you didn’t want to rock the boat. But how does this affect your homeowners insurance? You have to remember that homeowners insurance is written specifically for homes that will be owner-occupied, not tenant-occupied. Fortunately, most insurance companies are OK with this. They understand that there can be delays in the availability of a home when a seller is planning to move. But this kind of arrangement is typically limited to two or three weeks – 30 days at the most. If it extends beyond that you’ll have to get a tenant-occupied landlord policy, and that’s not going to fly with your lender. Once you finally do move in, your agent will have to write an owner-occupied homeowners policy. If you find yourself in a position where you’ll have to do a seller rent-back arrangement, the best course of action is to be honest with your insurance agent from the start. Your agent will relay this information to the carrier’s underwriter. And they want to accommodate you...
Breaking Down Renters Insurance

Breaking Down Renters Insurance

Before you purchase a renters insurance policy, you’ll need to take an inventory of everything you keep inside your home and get an idea of its value. You’ll have to make an important choice between two options that will greatly affect your premium and payout; knowing what your stuff is worth can help you decide. The first option is to receive the actual cash value (ACV) of your personal items in the event of a theft, accident, or natural disaster. When you choose to receive the actual cash value, your insurance company will determine what the actual value of one or more items that were damaged/stolen and pay you that amount. For example, suppose you bought a $600 television three years ago that was recently stolen. Your insurance company will take the retail value of the tv, account for its age, and then pay out an amount that the item would be worth today. The other renters insurance option you have is to receive the replacement cost value (RCV) for your items. If you choose to receive the RCV, your insurance company will pay you out what it costs to replace an item that was damaged or stolen. An individual in the same example above who had an RCV renters insurance policy would receive an amount from their insurance company based on what it would cost to purchase a new version of that $600 tv, with the same specifications, as opposed to what a used tv would be worth. Both insurance policies have their ups and downs, but generally, an RCV renters insurance policy will pay out more than...
Will My Car Insurance Cover a Bad Engine?

Will My Car Insurance Cover a Bad Engine?

Engine and trouble are two words that no motorist wants to hear together, but almost certainly will at some point in their lives. Unfortunately, your auto insurance will only cover engine trouble in certain cases. For example, depending on the kind of auto insurance you have, your insurer may cover damages to your engine if you’re in an auto collision, someone has vandalized it, or if it was damaged during a flood. Other than that, if your engine needs work, it’s probably going to have to come out-of-pocket. The reason for this is that, while engines are designed to run for hundreds of thousands of miles, they’re not intended to last forever. If you purchased your car new and your engine goes bad relatively soon after, your warranty may cover it. Most new cars come with a standard 100,000-mile or ten-year warranty on the drive train and a 5-year, 50,000-mile bumper-to-bumper warranty. Many used cards also come with a warranty, though it’s mainly just whatever is left over from the original warranty from when the car was new. Aside from the warranty, the best thing you can do to try and avoid costly engine damage is to service your car regularly. Cars are complex machines, but to keep them in the best shape possible, you need to take care of them. Regular service check-ups can find potential issues before they occur – saving you time and money down the road. Additionally, putting quality fluids in the engine as opposed to cheaper alternatives is also beneficial. Your auto insurance policy is primarily designed to provide you with coverage in the event...
Does Homeowners Insurance Cover Damage from Wild Animals?

Does Homeowners Insurance Cover Damage from Wild Animals?

If you own a home in an area that’s a little outside of town, near mountains or a forest perhaps, you’re probably aware that wild animals pose an issue. You’re probably also aware that the damage these wild critters can cause your home can be considerable. For example, people living near mountains as well as state and national parks in Southern California have to be on the lookout for bears during certain months of the year. Bears looking for food have been known to rip open flimsy garage doors or smash their way through screens and sliders with ease. It may seem far-fetched, but in some areas, it happens almost every year. When and if a home incurs damage from a wild animal, many home insurance policies will cover the damages so long as the animal isn’t a rodent (rats and mice). Therefore, if an animal such as an opossum, raccoon, bird, bear or mountain lion damages your home, your homeowners insurance policy may cover the damages. For a home insurance policy to cover damage caused by a wild animal, it’s important that the damage stems from a single, identifiable event. If the damage accrues slowly over a period of time in which something could have conceivably been done to mitigate the damage, homeowners insurance probably won’t cover it. It’s good to keep in mind that while many home insurance policies do cover damages from wild animals, not all of them will. If you live in an area that’s known to have wild animals come through from time-to-time, it would be wise to consult your insurance agent about whether or not...