Does My Credit Affect My Insurance Rate?

March 31, 2011 at 3:10 pm | Posted in Insurance | Leave a comment

Have you ever been told that your credit score affects your insurance rate and wondered why?  Simply put there is a correlation between a consumer’s fiscal responsibility and the number of claims submitted to insurance companies.  Consumers with good credit history benefit from lower insurance premiums because the Insurance Companies are better able to identify low risk individuals and reward them with lower policy premiums.  

In 1970, Congress passed the Fair Credit Reporting Act, which gave insurance companies permission to use credit information to establish underwriting guidelines and rates. 

  • Insurance credit scores are not the same as the more common credit score.  Insurance companies are only provided with credit related information enabling them to predict the probability of insurance claims individuals will file.
  • Insurance credit scores drastically improve the accuracy of the insurance company loss predictions meaning consumers pay premiums that more accurately reflect their individual risk experience.
  • The formula created by the insurance companies is applied to each individual in the same manner so that the process is objective and fair.  The Equal Credit Opportunity Act prohibits the use of gender, race, religion, marital status or place of birth in the insurance company calculations.
  • Insurance Credit Scores are NOT the only factor used in determining rate.  Other factors include but are not limited to: driving records, coverage limits, property value, loss/accident history.
  • Credit inquiries from insurance companies (non-lending type inquiries) do not adversely impact your credit score.

Several independent studies support research showing that individuals who manage their financial responsibilities well also manage other important aspects of their life well.  Responsible consumers are generally safer drivers and maintain their property more responsibly than consumers with a poor credit history. 

One last thought:  a periodic check of your credit report is a wise habit to establish.  The three major credit reporting companies are Equifax, Experian and Trans Union.

This information is intended for educational purposes only.  As always, please feel free to comment on this or any other NSA Group blog post.

 **For additional information refer to the following brochures on our website page http://www.nsainsure.com/index.cfm?pageid=191

  • “What’s Credit Got To Do With It?” from Property Casualty Insurers Association of America.
  •  “Credit Matters” from Peerless Insurance company which outlines ten steps to improve your credit history.
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Are You Fulfilling Your Responsibility as a Board Member?

March 24, 2011 at 12:46 pm | Posted in Religious Institution | 1 Comment

As a church board member there are many obligations to fulfill during the course of a year. Your responsibilities often reach beyond the spiritual well-being of your congregation to things like insurance. 

This project can be one of the most valuable tasks you perform all year. Protecting your religious institution comes down to more than just dollars and cents; it is also about proper, specialized and high-quality insurance coverage and an insurance agent that is an expert in writing this class of business.

 Important Factors to Consider

 Building and Property

  • Has the square footage changed?
  • Have building updates or improvements been made in the past year? Are you planning to do so?
  • Has there been a change in business personal property?
  • Have structures been purchased, sold or rented?

 Workers Compensation

  • Have staffing levels changed?
  • Do class codes need to be updated or changed?
  • Is appropriate documentation maintained and up-dated for any independent contractors? 
  • Are you requesting Certificates of Insurance for all?

 Liability

  • Are there newly added special events that need special coverage considerations?
  • Do they lease or loan space to outside organizations?
  • Is there a daycare, preschool or school established onsite? 
  • Do you have Umbrella coverage?

 Additional Coverage

  • Have changes been made to the automobile schedule?
  • Is the directors & officers coverage rated for the appropriate number of participants, if applicable?
  • Is the umbrella coverage adequate?
  • Do mortgagees need to be added or deleted from a policy?

We understand that updating your insurance policy might not always be a priority for discussion among your board members, but it should be a discussion with your insurance church specialist every time decisions are made that affect your exposures to a potential risk.  

Remember, in the event of a loss, a properly tailored, updated and well understood insurance policy may be your best friend.

This information is intended for educational purposes only.  As always, please feel free to comment on this or any other NSA Group blog post.

Why is a Home Inventory so Important?

March 17, 2011 at 6:43 pm | Posted in Uncategorized | Leave a comment

Possessions; if you’re like most of us you don’t realize how many possessions you have accumulated over the years.  Now imagine you have to prove you owned all of those accumulated items.  Could you?

If the unthinkable happens and your home is destroyed by fire, you loose your engagement ring at the beach or damage occurs to your property from a covered loss (insurance lingo), what would you do?  You’d call your insurance agent.  And what would your agent ask you for?  Proof!

New homeowners, now is the time to create this list as you are either beginning the accumulation or have it all neatly boxed and itemized for your move.  If you’ve been living in your home for quite some time don’t be discouraged.  Start with your most valuable items and steadily add to the list.  Your list should include:

  • A description of each item
  • Make and model number if available.
  • If you are able to attach sales receipts, or better yet appraisals, all the better.

Be sure to pay special attention to valuable items, especially those listed below.  It is very important to make sure you discuss these items in particular with your insurance agent to make sure they are covered properly and that the value hasn’t increased since you purchased them.

  • Jewelry
  • Artwork
  • Silverware
  • Collectibles (Stamps, first edition books, guns, sports memorabilia, cameras, etc…)

 A video recording of your house or apartment describing the above is a great start as well.  It’s bad enough to have a total loss but to not be properly compensated because you lack the proof would be even worse.  Take the time and protect your possessions!

 For more information visit our site at:  http://nsainsure.com/index.cfm?pageid=195 and slide down to the Auto/Property Valuation Websites section.

 This information is intended for educational purposes only.  As always, please feel free to comment on this or any other NSA Group blog post.

 ** Information gathered from:

http://http://www.assetarchives.com/blog/bid/57687/9-Reasons-Why-You-Need-a-Home-Inventory

http://www.iii.org/articles/how-do-i-take-a-home-inventory-and-why.html

Is Your Church Ready for a Workers’ Compensation Audit?

March 8, 2011 at 8:57 pm | Posted in Religious Institution | Leave a comment

The thought of a Workers’ Compensation Audit for your Church may seem like a confusing, time consuming and somewhat cumbersome feat; however preparation is the key for an accurate and positive audit experience.

For starters knowing what a Workers’ Compensation Premium Audit Is

When a policy is issued, usually on a one year term, the premium is based on the annual compensation that is anticipated at the beginning of the year. The premium audit is the process that determines how much the compensation has changed by year end so a final premium paid can be made proportionate to the actual compensation amount.

Most insurance carriers use the following information in determining the workers’ compensation premiums.

  • The amount of payroll generated by the employer
  • The classification assigned to the employee based on business operations
  • The past loss experience of the employer

 Information to have ready for your Audit

  • Job Descriptions documenting your Employee’s Duties
  • Employee Tax information

             – Form 1099 for any employee who has an employment relationship

             – Employer’s Quarterly tax return form 941

             – Employer’s Annual Federal Tax return form 944

             – Accounting records of payroll – Make sure that the payroll information is related to the term of your workers’ compensation policy.

              – Any Financial transactions related to employees – this includes housing, travel, or any other expenses made on behalf of an employee.  Compensation not included in payroll should be broken out by each individual employee.

               – A listing of all Contractor payments, including general and independent contractors, visiting pastors and or a music/worship team.  Certificates of insurance for all contractors must be available for the auditor.  Failure to provide a certificate may result in an additional charge to you on your policy.

This information is intended for educational purposes only.  As always, please feel free to comment on this or any other NSA Group blog post.

Is Your Contractor Liability Policy Full of Holes?

March 2, 2011 at 6:41 pm | Posted in Business Insurance | Leave a comment

Ok Contractors, you’ve just gotten a new job; contracts will be signed, subs hired, orders placed and insurance certificates gathered or provided.  The question is do you have a Swiss cheese policy, full of holes, or a cheddar policy, that covers all the gaps?  General Contractors will be requiring their subs to provide evidence of insurance or certificates of insurance as we call them in the insurance world and subcontractors will have to provide them.  In either case here are some important questions you should ask your insurance agent.

  • Review the endorsement and/or exclusions on your insurance policies.  Make sure they are not “Swiss cheese” policies with lots of holes in coverage.
  • Make sure your policy includes contractual liability.  The NY State Labor law 240/241 allows for litigation upon injury to a construction worker and you should have the proper liability protection.
  • General Contractors should have a hold harmless agreement in place and all subs should be required to sign the agreement before starting any job.
  • Be sure your policy and those of your sub contractors has a per project aggregate instead of a per policy limit.  This will make sure funds are available even if there are other claims on the policy at the time.
  • Specifically request that no exclusions for NY Labor/ 3rd Party Action Over are on your policy or that of your subcontractors.

Proper liability protection for contractors can mean saving thousands/millions of dollars in litigation expenses.  Many times adding these coverage’s to your policy is not as costly as you might think.  Please speak with an insurance professional and/or legal council for details.  And if you are told by your insurance carrier or your subcontractors that these coverages cannot be added, look elsewhere for your insurance coverage.  There are plenty of carriers that will provide the proper coverage.

This information is intended for educational purposes only.  As always, please feel free to comment on this or any other NSA Group blog post.

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