I’m gonna save you a ton of bucks right now, and maybe if you are really unlucky, a few $100,000.
In one of those odd confluences of fate, I heard two really awful insurance related stories yesterday, neither of which had to be so painful.
Learn from them.
Ugly Story One: A relative has her condo up for sale. Long story short, jewelry was stolen during one of the showings. A few specific expensive pieces were pilfered.
Here’s the insurance info you may not know: Unless you specifically have a rider for individual items on your Home Owner’s policy, you are likely looking at a $3,000 limit (it varies by policy).
Not per piece — without a rider, that may be the total limit on personal items. EVEN IF $50K IN GOODS IS STOLEN (Ouch)
Important Lesson: Buy a rider for specific items worth more than $3k in value: Rings, Bracelets, Earrings, Watches, even Plasma Screens. I assume the same applies to any Art items — paintings, lithos, etc. Of course, save reciepts and place copies in a duplicate locations.
Also, one can never go wrong with an Umbrella Liability Insurance policy; $3 Million is actually prettty cheap coverage.
Ugly Story Two: You have fire insurance, which you assume covers rebuilding your home in the event of a total loss. Not true. As one of my neighbors discovered, their insurance is for a specific dollar amount — NOT REPLACEMENT VALUE.
So if you bought a house 10 years ago for $300k, your insurance today (likely $150k — it covers the home, not the land) is likely totally inadequate to replace the home in the event of a total loss.
Important Lesson: Periodically review the replacement cost of your home(s). Get builder/contractors estimates of a total rebuild costs; Upgrade your coverage to full replacement cost.
Pay attention: I declare today CALL YOUR INSURANCE AGENT AND COVER YOUR ASS day.
Feel free to share insurance horror stories — as well as good coverage tales — in the comments below.
Lately, I have been noticing that many economists, analysts and strategists have been having some sly fun by naming their research after songs.
My own contributions to the space have been the past two commentaries: Bad Moon Arising, and Been Down So Long (It looks like up to me).
But I also noticed that John Roque’s past two comment’s were titled BRIC House, and R-E-S-P-E-C-T. AndMorgan Stanley asked: Will the Real Slim Saving Rate Please Stand Up?
Most of these players came of age during the Golden Age of Rock-N-Roll (Disco era aside) in the 60s, 70s, and 80s. I’m bettting that most of this crew (present company included) are in their 30s or 40s.