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About: Dave

Name  :  David E. Young
E-mail  :  dave@brown-ohaver.com
Website  :  http://adjusteradvocate.com/
Profile  :  David E. Young, CPPA, SPPA Certified Professional Public Adjuster Senior Professional Public Adjuster Mr. Young is one of the very few individuals throughout the world who has passed both the Certified Professional Public Adjuster (CPPA) Examination and the Senior Professional Public Adjuster Examination (SPPA). He is a nationally recognized expert in the appraisal of insurance claims, having been retained by a national publisher to author writings to train attorneys in this provision of insurance law.

Posts by Dave:

Understanding the Deductible in Your Insurance Policy

The deductible in your insurance policy is often misunderstood. The deductible is the amount of money that you will have to pay out of pocket on each claim. Some policies provide for no deductible and others, such as some State Farm policies, have policies that tie the deductible to the limit of the policy.

I once assisted an insured in a $ 30,000.00 claim that had a deductible of ten percent. The policy limit was $ 280,000.00 so the deductible was $28,000.00 leaving the insured with just $ 2,000.00 to repair the damage to her home. She was surprised that she had that ten percent deductible and frankly, there are many people like her that do not even know what their deductible is. In order for some insurers to remain competitive, they structure their deductibles in order to decrease their claim payouts. That way they can reduce premiums. This is a good reason for insurance consumers to check their policy for the amount of deductible shown, or call their agent right away.

Generally, the higher the deductible the less the premium will be. A policy with a $ 500.00 deductible will cost more than a policy with a $ 1,000.00 deductible but sometimes the price difference is so small that you might just consider the lower deductible.

We must note that the deductible only applies to the damage, not the policy limit. For example let’s use a deductible of $1,000.00 with a $100,000 policy limit and you have a $ 90,000 loss, the amount the insurer will pay you is $89,000.00. But here is the kicker, if your loss is $105,000, and your deductible is $10,000, your insurer should pay you $95,00000 because the deductible is taken from the amount of the loss, not the policy limit. If your loss is $110,000.00, with a $10,000 deductible, the insurer will pay you $100,000.00. Many insureds and some claim representatives do not understand this but at Brown – O’Haver, we do. We will always do our best to collect the amount your insurer owes you for a loss. No more and no less.

What is an Inflation Guard Endorsement?

One of the things that we find insureds’ miss in settling their insurance claim is the Inflation Guard Endorsement. Many have this in their policies but are not exactly sure what it means.

Basically, an inflation guard endorsement insures you for the increasing value of your property. If the value of your property is increasing, your policy must be periodically increased to maintain proper coverage. Even though the amount of coverage is adequate at the time of inception of the policy, it may not be enough in the future.

To aid you in keeping coverage at an adequate level, some companies offer an Inflation Guard Endorsement. This endorsement allows your insurer to automatically change your policy limit during the policy period. Normally, the higher premium is not paid until the time of renewal. The insurance companies like this because they get to increase their earnings.

Even if you have this endorsement in your policy, you should check your coverage limits periodically to make sure you are adequately insured. As Public Adjusters, Brown – O’Haver wants you to insure your property adequately but not excessively. We recently assisted an insured get his claim settled and his insurance was twice the value of his property. Insuring your property too much is like putting more stamps on an envelope than your need. In some states, such as Montana, such a total loss will trigger payment for the policy limit. Many others, such as Oklahoma or Arizona, do not. Your loss in these states and others are computed and paid at the amount of the loss.

Not all companies offer this endorsement so review your policy or check with your agent. If you have issues, we would like to assist you. Considering the fact that congress is spending money like a drunken sailor, inflation is inevitable. Get ready for this inflation and “gird up your loins”. Brown – O’Haver Public Adjusters recommends that you obtain an Inflation Guard Endorsement if you don’t have one.

Optional Insurance Coverage

Recently one of our clients discovered that he did not have insurance for something he thought his premiums paid for. What a disappointment! It would be wise for everyone to review their policies and look for the following optional coverage you might want to consider. Here are a few:

Guaranteed Replacement Cost Coverage. This is insurance coverage that pays to replace your home even if the loss exceeds the policy limit.

Inflation Guard Endorsement . Since the replacement cost or your home is increasing with inflation so will your policy limits. This coverage periodically increases to maintain your coverage.

Mold Coverage. Most insurers (with the exemption of State Farm which does not) offer a limited amount of mold insurance in the policy. You can usually increase this with a simple and inexpensive endorsement.

Earthquake insurance. Yes, with the exception of Arizona which deals with other issues, every State is subject to a potential earthquake as we have seen recently in Oklahoma. Earthquake insurance is normally issued as an endorsement and attached to your home insurance policy.

Flood insurance. Standard home insurance policies do not cover flood damage although we recently helped an insurance consumer who had purchased a flood insurance endorsement as part of her policy. The next best option, and it is an inferior one, is to get a policy through the National Flood insurance program (NFIP). Your agent can help you do this. The NFIP Claim process is so flawed that we do not take NFIP claims any longer but hopefully you might fare well with this very difficult government insurance on your own. After all, as bad as some things are, they are generally better than nothing.

Increased limits on Money and securities. This endorsement increases the coverage on money, bank notes, securities and deeds.

Scheduled Personal Property Endorsement. This endorsement is sometimes called a “personal article floater”. A personal article floater covers things of value you own that might exceed coverage policy limits, such as a Rolex watch or your stamp collection or your fur coat. We have such an endorsement for a painting we own. There is typically no deduction applied to this coverage.

Theft Coverage Protection Endorsement. As a result of this endorsement, your theft protection is broadened. Theft claims are one of the most difficult claims that Brown – O’Haver works. The contents of your motor vehicle or watercraft without proof of forcible entry would be covered but such coverage is not generally available to all policies.

You can insure most anything. Rumor has it that Mariah Carey insured her legs for 675 million dollars! Look at your policy closely to see what is insured. Get a good insurer and only pay for what you need. Look for the policies with similar coverage that costs the least amount of money. If you have any questions, call Brown – O’Haver and ask an adjuster for an opinion. We love to give opinions and welcome your calls.