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Category: Risk Management

Insuring Condos is Just Like Insuring Any Other Home – Right?

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Owning a condominium is a big investment, and it’s important that you take the necessary steps to protect it. And while condos do have many of the same risks as houses, there are also other risks you need to be aware of – and coverages that can protect you. There may also be less that needs to be covered than a traditional house, but it’s important to understand what that really means. Let’s take a look!

What Kind of Insurance Do I Need?
As you might expect when insuring a condo, there are three common types of coverage: dwelling, liability, and personal property. Dwelling coverage typically covers any repairs or replacements needed due to fire, theft, or specific natural disasters. Liability coverage is to help protect you from lawsuits that may arise from an accident in or around your condominium. And finally, personal property coverage is used to cover items inside your condo if they are damaged or stolen.

However, condos are typically insured on an “HO6” policy. The main difference in that and a “regular house” policy (typically covered by an “HO3” policy) is that condo owners are not usually responsible for the “common areas” around their condo. As examples, the hallways, land, parking areas, etc. are usually the responsibility of the company that owns or manages the condo – or the condo owners’ association.

So, as a condo owner with an HO6 policy, you may have “less” to cover. But that doesn’t mean you have less to protect. HO6 policies don’t typically protect you against losses from earthquakes, sinkholes, floods, and municipal water/sewers.

What Other Coverages Do I Need?
To fully protect your condo, you should discuss additional coverage options with your insurance agent. Coverages for flood, water backup, earthquake, and umbrella policies for additional liability may make sense depending on your specific risks.

Another coverage to review is “unit assessment” insurance, which can reimburse you for your share of an assessment charged to all unit owners as a result of a covered loss. For instance, if there is a fire in the lobby and all the unit owners are charged the cost of repairing the loss.

Insuring condos, like most property, is often unique to the risks you face. Contact Brandon Patterson at 865.453.1414 or email brandon@ownbyinsurance.com and let him help you determine your risks and understand your coverage options!

Would You be Covered if Santa’s Sleigh Damaged Your Roof?

Posted on by Ownby-Client-Login

Have you ever thought of the possibility that Santa’s sleigh might cause damage to your roof? It’s hypothetical of course (or is it?), but if a large sleigh filled with gifts and a crew of flying reindeer landed on your roof, it’s hard to believe they wouldn’t ever leave behind some damage. So, if some tiles were damaged – or worse, you have a Santa’s sleigh-shaped hole in your roof – what would you do?

Would Home Insurance Cover It? Maybe.

Homeowner’s insurance generally covers any damages caused by sudden and accidental events. This includes damages from storms, fires, theft, vandalism, accidents, and more. The key here is that the incident must be sudden and accidental. So, what does this mean for Santa’s sleigh? Well, if it suddenly crashes into your roof and causes damage then it would likely be covered by your homeowner’s insurance policy.

It is important to note, however, that most policies have exclusions for any kind of intentional or expected damage. That means if Santa was aware of the potential for his sleigh to crash into your home but decided to risk it anyway then your insurer may not cover the damage costs as they are expecting him to take reasonable precautions when travelling around homes on Christmas Eve! In addition, some policies also exclude all kinds of “acts of god” type events so in that case even if Santa was unaware of the potential for crashing into your home your insurer could still choose not to cover the costs associated with repairing the damages.

How Can You Protect Yourself?

The best way to protect yourself against any unexpected events like this is to make sure you have adequate coverage in place with a reliable insurer who will provide prompt service when needed. Make sure you are familiar with all of the exclusions listed in your policy so that there are no surprises should something happen. Additionally, always keep detailed records including photos and video footage just in case you need them down the line (Plus, we want to see the sleigh!).

Lastly don’t forget about preventive maintenance – if there are any issues with your roof make sure they get fixed before Christmas rolls around; after all it wouldn’t hurt for us all to do our part in helping out old Saint Nick!

Contact Brandon Patterson at 865.453.1414 or email brandon@ownbyinsurance.com and let us help you plan for any unexpected events.

Are Your Cabin & Vacation Rental Risks Higher During Winter?

Posted on by Ownby-Client-Login

Over the past decade, Cabin and Vacation Rentals have continued to increase in popularity, and winter has quickly become one of the busiest times of year for these properties. However, with the colder weather comes a unique set of risks. So, are there greater insurance risks during the winter months? Let’s take a closer look at this important question.

Winter Weather Risks

One of the biggest risks during winter rentals is weather-related damage. Snowstorms can cause roofs to collapse, ice dams can form on gutters, and freezing temperatures can cause pipes to burst – all of which can lead to costly repairs or replacements. If you or a renter isn’t occupying the cabin, even more damage can occur while these damages go unchecked.

Higher Risks for Fire

Another risk associated with renting out a cabin or vacation home in the winter is the potential for a fire. Many people who rent cabins are looking to enjoy activities that involve open flames such as fireplaces, candles, campfires, fire pits, etc., which carry an inherent risk of fire damage. Additionally, bad weather can make roads impassable or make it difficult for emergency services to reach their destination.

Insurance Fraud Issues

It’s also important to be aware of potential insurance fraud when renting out your property in the winter months. Unfortunately, some unscrupulous individuals may try to take advantage of your generous hospitality by claiming damages that never actually occurred or inflating their claims in order to receive more compensation than necessary from your insurer.

Preparation is the Key

Preparing your property for these risks and having the right coverages in place should an issue occur is critical. Some steps for preparation to consider include:

  1. Take steps to winterize your property, including cleaning gutters, changing filters, checking pipe insulation, and inspecting roofs.
  2. Post clear instructions for renters on using fireplaces, candles, and open flames near any flammable materials.
  3. Review potential renters’ profiles and previous “reviews” if available. Compile all the appropriate information to contact them should an issue occur.
  4. Having cameras on your property to keep up oversight may also be a good idea, but be sure to be mindful of privacy and appropriate locations for monitoring.

With a little bit of foresight and preparation, cabin owners can enjoy peace of mind knowing that their rental properties are properly insured during the potentially hazardous winter months. By researching different policies and understanding what types of risks are associated with renting out a cabin during this time period, you can ensure that you are adequately protected against any unforeseen events that might occur while renting out your property during this season. Let us help you review these options and determine the coverages that are best for you! Contact Brandon Patterson at 865.453.1414 or email brandon@ownbyinsurance.com and let us help you get started.

Your Business’s Workers’ Compensation Rates: How Are They Determined?

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If you have a business with employees, you certainly want to protect them in case they get injured on the job. But workers’ compensation insurance can sometimes be confusing, especially when it comes to understanding how your rates are determined. There is a general formula we will discuss, but the unique characteristics and financials of your business play a key role. The following are the basics of what you need to know.

 

Your Payroll: The payroll for your business is the starting point for calculating your workers’ comp premiums. For every $100 of taxable wages you pay on payroll, you will be charged an amount for work comp coverage. What amount? Let’s take the next step to find out.

 

Your Employee Class Code/Rate: For every employee, there is a 4-digit class code assigned to work they perform. In Tennessee, the rates for those codes are determined by the National Council on Compensation Insurance (NCCI). In theory, the rate should correspond to the risk the employee has based on their job’s tasks. For example, an office worker may have a rate of $0.15, while a manufacturing worker may have a rate of $15.00.

 

Your Experience Modification Factor: Also known as an Experience Mod or just a Mod, this factor is based on the comparison of your business to others in your industry. How old is your business? How frequently have you had work comp claims? How severe are those claims? These are factors that will impact your Mod.

 

The average Mod is 1.0, so your business will be higher or lower depending on the circumstances. If you have a good business history with minimal and less severe claims, you will likely have a Mod lower than 1.0. For example, a 0.90 Mod would give your business a 10% credit. Conversely, a 1.10 Mod would add a 10% debit to your work comp rates. Other factors, like the Loss Cost Multiplier an insurance company applies to the rate, may also have an impact.

 

The Formula:  Class Code Rate X Experience Mod X (Payroll/100) = Rate Estimate

 

Workers’ comp can be a complicated coverage, but it doesn’t have to be. Contact Brandon Patterson in our office at 865.453.1414 or email brandon@ownbyinsurance.com to discuss your risks and options for coverage.

What You Need to Know About Insuring Classic Cars

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If you have a classic car, chances are you’ve invested a good amount of time and money into its appearance, performance, and maintenance. And you definitely want to protect that investment. Having the right insurance for your vehicle is one of the best ways to do that. Let’s take a look at what coverage for classic cars entails.

Classic Versus Vintage Auto

Did you know there is a difference in what is considered a classic versus a vintage car? In order to qualify as vintage, a vehicle must be at least 25 years old. However, it can still be considered classic if it’s 15 years old or older and is a limited edition, rare find, or has high market value.

The “Need to Know” for Insuring Classic Cars

When you insure a classic car with most insurers, there are some key factors you’ll want to know about your coverage:

Agreed Value: Most classic cars are worth more than the average vehicle. This is taken into account when finding coverage, but in the case of your classic or vintage car, there may be other circumstances that make your vehicle even more valuable than its counterparts. Special modifications, unique history, clean title – these all can matter. That is why “agreed value” is such an important part of these coverages. You and the insurer agree on a value of the vehicle for which the coverage is then based.

Usage of the Car: How you use your classic car will affect how it’s insured. For example, if you only drive it to car shows, you’ll most likely have a different policy than if you drove it as your daily driver. Some insurers have mileage limits, potentially as low as 2,000 miles per year. Make sure your use matches up with any limit or look for a policy without that limit.

Increased Replacement Cost: Some insurers allow for greater replacement cost coverage in cases where value or cost of replacement parts has increased beyond the agreed value of the policy.

No “Attendance Required”: If you frequently display your vehicle at car shows, there may be times where you are not monitoring people around your car. If an incident occurs during one of these times and your vehicle is damaged, have “no attendance required” coverage may allow you to be reimbursed for your claim.

Spare Parts Coverage: If you have specialty tires, extra engine parts, etc. for your classic car, some policies extend coverage to these parts. If damage or theft occurs, you may have coverage under these policies.

When you’re insuring a classic car, it’s important to take all of these factors into account. These vehicles often have special meaning to their owners that goes beyond their value. Contact Brandon Patterson at 865.453.1414 or email brandon@ownbyinsurance.com and make sure that your classic is protected as much as possible.

When Your Business Equipment Breaks Down, Will You Be Prepared?

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When you think of business equipment “breaking down”, you probably bring images to mind of large manufacturing machines and big warehouses. And while this can sometimes be the case, more “everyday” equipment should also be in this conversation, including electrical and mechanical equipment, air conditioning and refrigeration systems, communication equipment and computers, boilers and pressure equipment, and even new technology.

Having insurance for equipment breakdown may seem like it has pretty self-explanatory coverages. But you might not have thought about some of the ways this coverage could support your business when things aren’t running.

Repair and Replacement
Likely the most obvious use for this coverage is to repair or replace the equipment that isn’t working. But that also takes the labor to complete the process. Having this coverage may also help you have the funds to pay for this labor.

Business Interruption
Your business may not be able to fully operate without this equipment, or it may not be able to operate at all. If the work outage meets the parameters of your policy’s language, you may be able to recuperate revenue loss that occurs as a result of the equipment’s failure.

Damaged Products or Goods
If the equipment’s malfunction causes damage to your business’s products or goods, your policy may provide you compensation. Think about issues with refrigeration or damages due to lack of power. These are examples that might come into play.

Third Party Damages
What if your equipment breakdown causes damages to other businesses? Or what if their equipment failure has an impact on your business? Having the right coverage in place might protect you if either of these scenarios occurs.

Part of running a successful business is planning ahead. And when unforeseen issues occur, good planning is critical. Contact Brandon Patterson at 865.453.1414 or email brandon@ownbyinsurance.com and he’ll be happy to discuss the insurance aspect of your plan and provide you info on the coverage you need.

Don’t Let ATV Risks Ruin Your ATV Fun

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Fall is a great season to get those 4-wheelers, UTVs, and other specialty off-road vehicles out to explore. And while all these types of vehicles can be fun, they also have risks that you need to be prepared to face. Having the right insurance in place is a big part of that preparation.

Some of those risks and coverages may be obvious, like collision coverage for accidents and comprehensive coverage for incidents of theft, fire, animal collisions, etc. But what about some of the less thought of risks you may face? Let’s take a look at a few:

Accessory Coverage
Many people add accessories to their ATV/UTV like trailer hitches, hunting equipment, custom seats, etc. This non-manufacturer-standard equipment may not be covered on your current policy. It may, however, be an option to be added or included in a different policy option. Even helmets, riding gear, radios, etc. may have the option to be covered if used exclusively for the insured vehicle.

Uninsured/Underinsured Motorist
Many people don’t insure their vehicles, especially if they are specialty vehicles like ATV/UTVs. If your vehicle is damaged in an accident with an uninsured or underinsured vehicle, you may not have coverage on a “standard” ATV/UTV policy. Adding this coverage, and/or potentially extending coverage to your ATV/UTV on a personal umbrella policy, may protect you from this type of liability.

Transport/Trailer Damage
Do you transport your ATV/UTV to other locations to ride? What about locations like trails, state/public parks, or hunting properties? If you do, you may have coverage limits, or a lack of coverage, that you’re not aware of having. Some state and public parks require ATV/UTV insurance for riders, meaning that if your vehicle is included under your home/auto policy, you may have coverage in these parks. In addition, the limits for damage to your ATV/UTV while it is trailered may not be enough to coverage damages in case of a severe accident.

As you can see, there is more to think about when covering these specialty vehicles. Contact Brandon Patterson at 865.453.1414 or email brandon@ownbyinsurance.com and he’ll be happy to discuss it and provide you info on the coverage you need.

It’s Fall! Are There More Risks in Store this Season?

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There is a large contingent of people that excitedly await the Fall season. In our region, the turning leaves, crisp weather, and seasonal décor make for a pretty sight. But this season also brings some risks for you and your property, and it’s a good time to prepare and avoid these potential issues.

Wild Animal Incidents
As the weather changes, the habitats for deer, bears, foxes, and more change. Their food may be scarcer, causing them to wander further than normal. This can lead to them walking on roadways and exploring more populated areas. In fact, statistics show that the majority of vehicle accidents involving animals occur between October and December. These are even more common at dawn and dusk, so be vigilant when you’re on the road this season.

Fire and Smoke-related Incident
We get it, a cozy fire can sound very nice when the evenings cool down. But fireplaces, candles, and wood stoves can lead to issues. Almost a third of smoke and fire claims occur during the Fall and Winter months, and Ready.gov stats show that over $7 billion per year of property is lost in house fires. Please make sure fireplaces and chimneys are clear, candles are kept in occupied areas, and wood stoves are monitored.

Leaves Can Be a Culprit
The colors of Fall can be beautiful, but they call it Fall for a reason. The leaves that collect on roofs, gutters, yards, sidewalks, and roads can cause damage – both directly and indirectly. Clogged gutters can lead to water damage, sidewalks and roads can be slick with wet leaves, and uncleared leaves on the ground can damage grass and landscaping. Be sure to clear your gutters, rake your yard, and be careful on those leaf-covered passages.

Have other questions about your seasonal risks? Contact Brandon Patterson at 865.453.1414 or email brandon@ownbyinsurance.com and he’ll be happy to discuss it and provide you info on the coverage you need.

Who Needs a Commercial Umbrella?

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You can probably guess pretty quickly that the “commercial umbrella” we’re referring to isn’t some industrial strength rain shield. In the case of insurance, a commercial umbrella can extend the protection your business has from certain limits of liability on other coverages.

For example, if you your business had a large legal claim against it, your businessowners policy might not cover all of the legal expenses, medical costs, damages, and/or legal judgements imposed. Most commonly, this is seen with general liability policies and commercial auto policies. And there must be an “underlying” policy to extend – you can’t just buy a commercial umbrella without base coverages. The reason for that is these policies are triggered by specific policy language. Something must occur with your other policy(ies) for this policy to “kick in”.

So, who needs one? While most businesses could benefit from having one in place, a commercial umbrella is especially needed for businesses that frequently interact with their customers in-person. This is especially so if equipment/machinery is involved – think of pest control, dry cleaning, restaurants, landscapers, and hardware stores as good examples. The key is to understand where you have the highest risk for a claim. As further examples – landscapers may cause property damage more frequently by flying debris, and a hardware store may be operating a forklift around walking patrons in risk of bodily injury.

The limits and costs of these policies vary of course, but they can be a very wise investment. You may be able to increase the amount of your “total” coverage by $1 to $15 million (more in some cases), allowing you to “customize” your business’s insurance plan.

Have other questions about protecting your business with an umbrella? Contact Brandon Patterson at 865.453.1414 or email brandon@ownbyinsurance.com and he’ll be happy to discuss it and provide you info on the coverage you need.

Minor Auto Accidents – Do you Need a Police Report?

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Recently, the Knoxville Police Department announced that they would no longer respond to “certain non-injury car crashes.” In other words, if you are involved in an auto accident and it doesn’t involve injury and/or leave a roadway blocked, an officer will not likely be on-site. The situations where they will respond include crashes that:

  • Result in injury or death
  • Involve a suspected intoxicated driver
  • Involve an unlicensed or uninsured driver
  • Result in a disabled vehicle on the road
  • Involve a disorderly or uncooperative party
  • Involve a hit-and-run with injury
  • Involve a Hazmat situation
  • Result in damage to other property

When these are not part of the scenario, what do you do? What about an accident report? Do you need one to file a claim? Take the steps if you are involved in a “minor” crash:

  1. Report it to the police. Use the local non-emergency line or call 911 if needed.
  2. Move your vehicle(s) to a safe area out of the road and exchange contact information and insurance information with the other driver(s).
  3. Take photos of any damage to the vehicles involved.
  4. The Tennessee Department of Safety requires you to complete an accident report if the damage is likely to exceed $400. You may complete a report online at https://www.tn.gov/content/dam/tn/safety/documents/owneroperator.pdf
  5. Contact your insurance agent to notify them of the claim. They’ll let you know the next steps to take to file the claim with the insurance company.
  6. While a report is not necessarily required for an insurance claim, it will help the process. And if there is more than $400 in damage (which is a very low threshold), Tennessee requires a report anyway.

With the above in mind, how can you be sure that you will not be incorrectly assessed fault for an accident? We recommend dash cams for personal vehicles, as that will likely help you capture footage in most accident scenarios. Having that footage should help clarify the accident cause and who is at fault, and there are many camera options available – some around $50 or less.

Have other questions about your auto coverage or claims scenarios? Contact Brandon Patterson at 865.453.1414 or email brandon@ownbyinsurance.com and he’ll be happy to discuss it and provide you info on the coverage you need.