April 20th, 2010
The MCCA will raise its cost by 14% on July 1, 2010. The MCCA increased its assessment following its annual actuarial evaluation required by Michigan law. The fund provides lifetime medical benefits to people who suffer catastrophic injuries in car accidents. Under the state’s no-fault insurance law, the MCCA must charge insurers a premium sufficient to cover expected losses and expenses that the MCCA will likely incur during the coming fiscal year. The law also requires the MCCA to address some or all of its current deficit. MCCA said the assessment increased primarily because of longer periods of treatment for injured persons and lower long-term investment assumptions.
Michigan is the only state in the nation that mandates unlimited lifetime medical benefits for people injured in auto accidents. It is estimated that almost 1,200 Michigan insured’s will be catastrophically injured in auto accidents next year. Estimating the projected claim payments for long term claims in which medical benefits are unlimited is complicated due to the difficulty in predicting life expectancies, medical cost inflation, investment returns, and the number of claims. The $143.09 assessment represents $116.84 to cover claims, $26.00 to address the $2 billion estimated deficit and $.25 for administrative expenses. The current deficit is estimated at $290.71 per insured car. The MCCA said it paid out $811 million (more than $115 per insured car) in 2009 for claim costs resulting from catastrophic injuries. The majority of these catastrophic injuries involve closed-head injuries, paraplegia, quadriplegia and burns. Since 1979, there have been over 24,500 claims reported to the MCCA, which will cost an estimated $71 billion.
The MCCA was created by state law in 1978. All insurance companies that write auto insurance in Michigan are required to be members. The MCCA reimburses members for Personal Injury Protection claims that have exceeded the statutory threshold. That amount increases to $480,000 effective July 1, 2010.
Thanks hope all is good with you, let me know what else I should or could do. By the way the leads seem to be picking up a little and I’ve done a few chats on line with prospects, pretty cool.
Tags: auto insurance, auto policy cost, car insurance, Insurance Costs, insurance coverage, MCCA insurance, Rising Auto Insurance
Posted in Michigan Auto Insurance, Millennium Insurance Agency News | No Comments »
April 20th, 2010
In this crazy upside down real estate market most home buyers are confused and upset with regards to the amount of insurance coverage they need on their homes. After purchasing a home with a real estate agent, acquiring a loan with a mortgage professional, it’s now time to purchase home owners insurance from an agent.
Most people are in disbelief when they learn that they need $300,000 of insurance on a home that they just purchased for $150,000. Why can’t they have insurance for the amount they just bought their house for? Why have more insurance then the purchase price? This is a typical discussion I have with clients several times a week. The fact of the matter is, the way the current housing market sits today, it cost more to build a new home then it does to buy an existing home complete with landscaping and other features.
Usually, my conversation with these clients revolves around clearing up some common myths. First of all, even though home prices have fallen, the price of building materials has not. Over the past couple of years materials have stayed level and in some cases they have actually increased. Demand for supplies has gone up around the world. And when demand goes up, so do prices. Secondly, even though we might think there would be an abundance of labor to rebuild homes this is simply not the case. With the building market slow, many contractors have left the building field altogether, switched from residential to commercial construction or left the area to find work in another state. A surplus of contractors ready to work at discounted prices is simply not the case.
All insurance companies use sophisticated replacement cost calculators to determine the replacement cost of a home. But, using some simple math it’s easy to understand the final result. Take a 2000 sq’ brick ranch home, finished basement with a 2 car attached garage. At basic construction cost, no upgrades, $110 per sq’ X 2000 sq’ = $220,000 + $35,000 ( finished basement) + $25,000 ( attached garage ) + demolition and salvaging costs. You can easily see how a home purchased for $150,000 to $200,000 would need to be insured for $300,000.
So, even though you may be frustrated that you need more insurance then the market value of your home, make sure that your home is insured properly. An insurance professional should be able to guide you into finding a product that has the proper protection and your might be pleasantly surprised with an affordable rate. Also, take heart, the low market values will not last forever and your home values will rise again!
Tags: home insurance, Insurance Costs, insurance coverage, insurance options, insurance plans, property insurance
Posted in Michigan Home Insurance, Millennium Insurance Agency News | No Comments »
March 17th, 2010
During these trying financial times, you may be looking for ways to trim the monthly expenses of your small business – perhaps you’ve thought of the idea of cutting back your insurance coverage. Think twice when you are looking to make this big change. Most businesses operate day to day making just enough for ends to meet. Just think if you have a disaster that would interrupt your business, and you just removed business interruption coverage to save a few dollars. You just lost more than a few dollars in loss of income. The removal of coverage could be the difference of staying in business or closing the doors. While this coverage may increase your premium payment, it can make the difference between survival and failure if your business can’t operate because of a disaster. It’s never wise to decide against the coverage you need to help your business survive. Before making what seems to be money saving changes with your insurance, review your policy with a professional insurance agent. They can assist you in determining what coverage’s can be reduced and what coverage’s are critical for your businesses protection.
Tags: business insurance, commercial insurance, insurance agent, Insurance Costs, insurance coverage, loss of income insurance, rising insurance costs, small business
Posted in Michigan Business Insurance | No Comments »
March 17th, 2010
The key to minimizing your insurance cost is to shop around and obtain several options and quotes. An independent commercial insurance agent is able to access multiple carriers and will be able to provide you with the best price for the coverage you need. Another way to keep costs down is to review your coverage’s yearly. Changing deductibles, removing old employees as drivers, adding new employees as drivers can reduce costs. The more diligent you are in updating your business insurance policy the better the company can take care of you. In addition most insurance companies give discounts for belonging to building association, local chambers, or other business associations. Insurance companies also may give discount for having a formal safety program in force and regular safety training for employees. When you have a safe work environment, it pays!
Ask your independent agent today if there are group discounts out there for your business!
Tags: business insurance, commercial insurance, rising insurance costs, Rising Insurance Premiums
Posted in Michigan Business Insurance | No Comments »
March 17th, 2010
You have a machine that makes your product, it breaks down and now you cannot fill your orders….what do you do? Without business interruption coverage you may not have the correct coverage to sustain your business. Business interruption insurance is probably the most valuable coverage your business can have. It is also coverage that is frequently overlooked by businesses and business owners. A main reason for the oversight is because it is easy to forget that income cannot be produced without an operating business. Or, the business owner believes property insurance will cover all losses. Most people do not realize that property insurance only covers the physical loss or damage to the location and contents of a business. It does not cover the loss of income while the location is being repaired or the continual fixed costs while the location is being repaired. The next time your policy is up for renewal take a look at your policy to see if you have business interruption coverage, this may help save your business hundreds if not thousands of dollars in lost income.
Tags: business insurance, commercial insurance, contractor insurance, equipment insurance, interruption insurance, property insurance
Posted in Michigan Business Insurance | No Comments »
March 17th, 2010
So, you are a contractor and have decided to start your own business. I find that one thing that most contractors do not think about is coverage for their tools and equipment needed to perform their every day jobs. Every day I receive calls from prospective contractors who tell me stories involving theft of tools and equipment and proper coverage was not on their current policies. Many times this coverage is looked over and not seen as important. However when your tools are stolen and you need to replace them, this coverage will come in handy.
Things to keep in mind: Take an inventory of all of your tools and equipment including descriptions and values of the tools. Make sure that you discuss this coverage with your insurance agent to see if your company offers these types of coverage’s. Also, make sure that you update the listing of tools and equipment when you purchase a new piece of equipment of if you replace a piece of equipment. Communication between you and your insurance agent is an important part in keeping you business properly insured and protected. Make sure you review your coverage periodically or when changes occur so that your agent can make the proper recommendations. Remember, a little bit of planning ahead of time will prevent a large headache and expense in the future.
Tags: business insurance, commercial insurance, contractor insurance, equipment insurance, Insurance Costs, insurance options, insurance plans, subcontractors, tool insurance
Posted in Michigan Business Insurance | No Comments »
March 3rd, 2010
NO HEALTH INSURANCE, THINK YOU CANT AFFORD IT?
YOU DO HAVE OPTIONS!
Having trouble affording the health insurance you have now of any health insurance plan? Limited benefit plans maybe right for you. Limited benefit health insurance plans are an excellent option for many consumers who can’t afford the premiums or deductibles on traditional health plans. They are as they suggest, limited in the amount they cover for services, procedures, tests, surgeries or hospital stays.
As an insurance professional with 18 years in the industry, I have seen many changes in the medical insurance arena. Unfortunately the changes have meant more premium for less benefits and much stricter underwriting guidelines. The increases in rates have far out paced average inflation and personal income. There in lies the problem, and the reason many Americans have decided to go without medical insurance or take out very high deductible plans.
Unlike the HAS, or high deductible plans which pay benefits only after you have met a family deductible, limited benefit plans cover the first dollar claims with little or no deductible, but could leave you exposed on the back end of very large claims. A typical plan might limit hospital coverage to $200,000 per year. So if your claim exceeds $200,000 you are on the hook for claim amounts over that limit, but if you and your family are currently without coverage, isn’t this a better alternative?
Also, the underwriting on limited benefit plans is much less stringent, as long as you do not have any current major medical conditions you are accepted into the plan.
Limited benefit plans are certainly not for everyone. If you can easily afford your current premiums or if you have serious medical conditions, you may not be a candidate. However, for many of my clients and many Americans, limited benefit plans are an option worth exploring.
Tags: benefit plan, health insurance, health premium, health premiums, hospital coverage, insurance options, insurance plans, limited benefits, medical condition, no medical insurance, rising insurance costs
Posted in Michigan Health Insurance | No Comments »
March 3rd, 2010
INCREASING INSURANCE RATES
Did You Know…
Rising Medical Insurance = Higher Auto Insurance Premium
The auto insurance laws in Michigan require that every person riding in an automobile be completely covered under the Personal Injury Protection, or PIP, part of their policy. I recently overheard an insurance underwriter say “If I ever get hurt in a car accident I sure hope it’s in Michigan. Its true, Michigan has the best medical benefits in the country if you are injured as a result of a car accident. Michigan has unlimited medical coverage, for the rest of a persons lifetime if need be, and of course we pay for it.
It amazes me at the number of people that I speak with daily that are unaware they have a medical benefit in their auto insurance policy, let alone it is one of the driving forces in the increases in their premiums. To the average person it might be a boring subject, but in looking at the topic closely, we can see how important it is for consumers to understand their policies.
This increase is coming at policyholders in two ways. First, the skyrocketing costs of medical insurance in general through out Michigan and the rest of the country, directly impact the PIP part of the auto policy. The losses that are attributed to PIP are some of the largest claims expenditures to a company. And if rates for medical insurance are going up in general they’re going up inside the auto policy. Second, to make matters worse, we are seeing a growing trend that many medical plans that provided consumers with their primary medical coverage, and in the past covered you in the event of an automobile accident, are now excluding this coverage in order to save money. That’s right, they’re shifting the cost to the auto insurance company. Auto insurance companies are aware of this and are requiring policyholders to carry full medical benefits on their auto insurance policies and therefore increasing their premiums.
Unless insurance laws change the increase in premiums will continue. Consumers would be wise to research carefully when choosing an auto insurance company. A good start would be to get the help from an experienced independent agent that can shop the market for you.
Tags: auto policy cost, Insurance Costs, Medical Insurance Costs, premium increase, Rising Auto Insurance, Rising Insurance Premiums
Posted in Michigan Auto Insurance, Michigan Health Insurance | 7 Comments »
February 17th, 2010
Electricians, plumbers, heating and cooling professionals, carpenters and many other contractors eager to land jobs and start making money must make sure they protect themselves for the long run.
It is often overlooked, however extremely important, that when an owner or general contractor hires a subcontractor to do work on their behalf they should provide satisfactory documentation of workers’ compensation insurance. Most states mandate by statute that employee’s of subcontractors be provided workers’ compensation benefits if an injury were to occur.
We have found clients who have performed the role of general contractor, hired subcontractors to carry out the jobs they were contracted to do, have not provided worker’s comp insurance, and have failed to require these individuals to provide proof of workers’ comp insurance. These clients were required to pay additional premiums after the fact, which cut heavily into the profits they had thought they earned. A potential far serious problem could also occur. That in the event of an injury the general contractor could be held responsible for damages and be liable to pay huge settlements.
Any of these issues can be easily avoided with some solid and simple planning. A consultation with an insurance professional on the proper programs for their situation is a good first step.
General contractors should contractually require any person or entity
with which they contract to provide proof of workers’ compensation. This will avoid any question of whether an employee/ employer relationship exists. By the person or entity purchasing and providing this proof shows the type of relationship that exists.
Tags: business insurance, commercial insurance, general contractor, liiability, subcontractors, workers comp, workers compensation
Posted in Michigan Business Insurance | 3 Comments »
