Ooops! I dropped my smartphone over the side of the boat!

Stuff happens when you’re on vacation. If you’re like my son-in-law and granddaughter, you walked into the ocean with your smartphone in the pocket of your shorts. If you’re like a former client, you dropped it over the side of your boat when cruising the lake.

Does your homeowners insurance policy cover the loss of your phone? Well … maybe.

If you have the kind of policy without any bells and whistles, it probably doesn’t. Most homeowners policies provide much broader coverage for your home than they do for your belongings.

In fact, while your home is covered for anything that happens to it other than events that are specifically NOT insured (i.e., excluded), your belongings are only insured for about 18 different events. Unfortunately, drowning is not one of them.

If you want to be sure your most valuable belongings have the broadest coverage available–either all the time, or when you travel–you have 3 different options:

-1- Add open perils coverage to your homeowners policy. It will provide essentially the same coverage for your stuff that it provides for your home. This is the most expensive option, and the policy deductible will apply to any claims.

-2- Purchase an inland marine policy, or floater. This policy is designed for property that moves around, has only a few exclusions (based on the type of property you insure), and usually does not apply the policy deductible to any claims. You can buy two types of floaters for your stuff while traveling:

-a- One type of policy is designed specifically for those who travel with their belongings. It does not cover property that typically remains at home.

-b- The other type of policy is designed to insure items that are specifically listed on the policy, with their value. The value of the property is established based on criteria for that type of property.

Most insurance companies also allow coverage for one or both floaters to be added by endorsement to your homeowners or renters policy.

So … if my son-in-law, granddaughter, and client had one of these floater policies or endorsements, YES, their policy would have provided coverage. And my sister’s policy would have provided coverage for her camera if she dropped it out of the hot air balloon while she was on safari in Africa – once she added the floater, that is. And yes, her asking me how to arrange for coverage before her trip really happened. Don’t wait until AFTER your trip to call your own agent.

How Big is Insurance Fraud?

How big is insurance fraud? It’s this big.

It’s so big, it’s difficult to understand. Take, for instance, the largest national health care takedown in U.S. history. According to the DOH, it took place last month:

More than 600 people were charged, including 165 doctors, nurses, and other medical professionals

162 people (including 76 doctors) were charged with prescribing and distributing opioids and other dangerous narcotics

The total amount of fraudulent billings to Medicare, Medicaid, TRICARE, and private insurance companies exceeded $2 billion

The DOJ press release reported that many of the billings were for medically unnecessary treatments, prescriptions, and medications that were neither provided nor obtained by the individuals who were insured … and in whose names they were ordered. Other defendants are accused of paying kickbacks for providing personal information of insured persons to providers so they could submit phony billings to Medicare.

How much of our heath insurance premiums do you think foot the bill for this?

Our Last Classroom CE Event in Montana: August 23 and 24

Regretfully, I’ve decided to scale down my full-time insurance endeavors. The insurance continuing education event scheduled  in Missoula next month will be the last live classroom CE event I’ll be hosting in Montana as Faulkner Education Services.

As much as I love visiting Montana and my wonderful clients and business associates in that state, retirement age is approaching and I’d like to spend more time doing other things I love–none of which involve the insurance industry to which I’ve devoted 44 years of my life.

I will continue my partnership with A.D. Banker & Company, both developing/writing CE courses for them and teaching their CE webinars. I will also consider opportunities to teach and conduct insurance CE classes and trainings on a contract basis, so long as my duties are limited to teaching, instruction, and/or consultation.

I welcome your calls and emails to keep me updated about what’s going on with you and in the last best place, and I plan to visit simply for fun, so please do keep in touch.

Click here for more information about the August CE event in Missoula

Click here for a copy of my most recent newsletter

Beginning in September, my newsletter will be published quarterly, instead of monthly. Click here to subscribe, if you haven’t already done so. If you want to keep track of my fiction writing, you can subscribe to that newsletter by clicking here.

I also plan to be available on Thursday evening, August 23, to say hello and goodbye to anyone who cares to visit. Time and place to be announced, so shoot me an email if you want that info.

July Newsletter

The July newsletter went out today. You can click the following links to:

Read the newsletter online

Subscribe to the current, and past, newsletters

Newsletter content includes: my insurance CE webinar and classroom schedules for July and August, insurance news, and a personal note from me, along with 3 of my favorite beach photos. (The picture shown here is a view of the Cape Cod Canal, something I posted just for you–it’s not in the newsletter!)

 

Why Not Reporting the “Little” Changes Can be a HUGE Mistake

People are required by all insurance policies, including their auto and homeowners policies, to report changes to their insurance companies or agents–usually within 30 days. Often, the failure to report a required change within a specific time period results in the denial of a claim.

Example:  Your son got his driver’s license 3 months before your policy renewed and you forgot to tell your agent and/or insurer. When the policy was ready to renew, you glanced at the renewal form you received in the mail and, because you still insured the same vehicles, tossed it away because you thought, Nothing has changed.

Unfortunately, something HAD changed: you had a new licensed, family member–something you are required to report. If your son drove your car and was involved in an accident after the policy renewed, your insurer could deny the claim for misrepresentation (i.e., lying).

Although you didn’t lie intentionally, the fact that you forgot to report the change, twice, might be interpreted as if you had lied because you didn’t comply with requirements of the policy (a requirement that would increase your premium) . Of course, your insurer may believe you and may simply charge you premium retroactively to the first day you son was licensed. But it doesn’t have to.

One of the changes on homeowners insurance policies that often go unreported involve different family members moving into and out of the home. Technically, a homeowners insurance policy is only intended to provide coverage for the resident owner(s) of the home–the people whose names appear on the deed AND who live there.

Example: Dad moved out of the home and into a nursing home permanently, and you moved from your apartment into his house. The homeowners policy wasn’t designed to provide coverage for this situation because you are NOT the owner. The change should be reported to the insurer and the company will cancel the policy and either issue a dwelling fire policy in Dad’s name or require coverage to be issued on some other type of policy that insures tenant-occupied buildings. Even if you are not paying rent, you need to buy a renter’s policy.

I know, I know, that’s more expensive for everyone and you and Dad don’t want to pay more money–things are already tight. But the reason it’s more expensive is because a loss is more likely to occur when a home is not occupied by the person who owns it.

If an insurance company learns someone other than the owner his living in a home (especially shortly after the policy is written), it will issue a cancellation notice for the homeowners policy. In the same way an auto insurer will deny a claim if a change isn’t reported on a renewal form, a homeowners carrier will refuse to provide insurance.

Please report all changes to your agent promptly. He or she will help you find the most cost-effective way of making sure your coverage does apply in the event of a loss. Think about it: if you save $100 a year by not reporting a change and the insurer doesn’t pay a claim afterwards, you not only didn’t save $100, you incurred a much higher cost.

Pardon the pun, but honesty IS the best policy!

Have You Registered YOUR Drone?

We see them everywhere these days, pieces of machinery zipping by overhead, buzzing like a swarm of bees. Drones, referred to as Unmanned Aircraft Systems by the Federal Aviation Administration, are not only used recreationally, they are also used by an increasing number of businesses. Insurance companies are currently using drones during claim processing and undewriting.

But did you know that most drone operators are required by the FAA to register their drones? And that different rules apply to the recreational and commercial operation of drones?

No? Well, ere’s a quick lesson about what you need to know along with a link to the FAA’s UAS webpage that will answer all your questions.

Drones weighing more than .55 pounds, MUST be registered. You can fly your drone recreationally for hobby or recreation ONLY by flying under the Special Rule for Model Aircraft (Section 336). If you don’t qualify as a modeler under Section 336, you can operation your drone recreationally or commercially under the Small UAS Rule (Part 107).

FAA rules and restrictions include flying at or below 400 feet, keeping your drone within your visual line of sight, not flying your drone in any airspace restricted by the FAA, not flying your drone over people or public events, and not flying your drone near emergencies.

If your drone weighs more than 55 pounds, you cannot fly it–either recreationally or commercially–unless you receive a waiver from the FAA. In addition, you need a waiver from the FAA if you want to fly your drone under Part 107 in any of the normally restricted ways if you believe you can do so safely … and for a good reason.

The cost to register each drone is $5 and registration lasts for 3 years. Drones must be labelled with their registration numbers.

Drones operated commercially require the operator to be at least 16-years-old, be issued a remote pilot certificate issued by the FAA, and undergo TSA security screening; other requirements also apply.

The FAA also offers a free downloadable smartphone app for Apple and Android devices, B4UFLY, that helps operators determine if restrictions or requirements apply in a location where they want to operate their drones.

Happy and safe droning!

Linda’s July Webinar Schedule

Here is Linda’s schedule of insurance CE webinar presentations for A.D. Banker during the month of July:


July 3 | 8:30 a.m. EDT – P&C Risks and Catastrophes

July 11 | 8:30 a.m. EDT – Personal Auto Coverages & Claims

July 19 | 8:30 a.m. EDT – 4-Hour Annuity Suitability

July 25 | 8:30 a.m. EDT – P&C Risks and Catastrophes

July 26 | 8:30 a.m. EDT – Disability Income Planning


To register for any of the webinars Linda is presenting in partnership with A.D. Banker & Company, click here.

Note: Some webinars are not available in all states. All times shown are EASTERN time.

#1 Thing to Know About Renting a Car

Did you know that when you sign a rental car agreement, you obligate yourself legally to be responsible for ANYTHING that happens during the term of the rental–even if you would not otherwise be liable if you hadn’t signed the agreement?

Yep. Read the agreement. Each rental car company phrases its contract differently, but every contract I’ve ever read says that when you sign the agreement you agree to pay for everything that happens to the car, or involving its use, while you’re renting it. Even if you’re not at fault and even if the event that causes damage or injury is outside your control.

Example: You’re driving your rental car down the street and a drunk driver rear-ends you, pushing your car onto the sidewalk, where you strike a pedestrian. If you did not purchase additional insurance or the LDW/CDW, you are contractually and legally responsible not only for the damage to the rental car but also for the injuries sustained by the pedestrian and any other fees and costs incurred by the rental company, including attorney fees if the pedestrian files a lawsuit. Yes, I know the drunk driver was at fault. But you signed a legal contract that said you agreed to be legally responsible for everything, no matter what. So you are.

There is a way to avoid this situation. At the time you rent a car, rental car companies offer a Loss Damage Waiver or Collision Damage Waiver provision that can be added to the rental contract, in the same fashion that any amending provision can be added to a contract. The purchase is like adding a codicil to a will or an endorsement to an insurance policy. The LDW/CDW provisions remove some or all the language in the rental agreement that requires you, the renter, to be 100% responsible for any losses and damages that occur.

A full or comprehensive waiver generally states the rental company removes the rental agreement’s provisions deeming the renter legally responsible for damages and costs. A partial or limited waiver states the rental company waives the renter’s responsibility up to a certain dollar amount (e.g., $25,000) and/or only for certain types of loss or damage (e.g., damage to the rental car).

Of course, the good news comes with a cost. The price tag for a LDW/CDW ranges from $15 to $25 per day, on average. As far as I’m concerned, that’s a small price to pay for the peace of mind knowing you don’t have to handle any insurance claims on your own (or pay the rental company’s costs and attorney fees) if your rental car is involved in a loss. Especially since every auto policy I read does NOT extend all the coverage necessary, in the manner required by the rental agreement, if you wreck the rental car. But that’s a story for another day.

Free advice: If you become a member of the car rental company’s rewards program, the savings you realize on the daily cost of a rental offsets some or all of the extra cost you incur when purchasing a LDW/CDW. As a licensed insurance agent, I haven’t EVER rented a car without purchasing a full LDW/CDW. You shouldn’t either.

P.S. Thanks to my Enterprise associates, Rebecca and Keith, for the photos taken at the IAIP convention earlier this month.

When is CMS Mailing New Medicare Cards?

https://www.medicare.gov/forms-help-and-resources/your-medicare-card.html

Everyone knows  the Medicare program sustains the highest fraud losses of any other insurance program in the U.S. Well, CMS is attempting to repair that problem.

The Centers for Medicare &  Medicaid Services (CMS) is changing beneficiaries’ Medicare numbers from Social Security numbers to a new 11-character number referred to as a Medicare Beneficiary Identifier (MBI). The new MBIs will contain numbers and uppercase letters, no special characters.

https://www.medicare.gov/newcard/

New Medicare enrollees will automatically receive cards with the new MBIs. Existing beneficiaries will receive their cards in the mail from the Social Security Administration (SSA) and can provide Medicare with their email addresses so they can be notified when their new cards are mailed.

New cards are being mailed during the month of May to beneficiaries in the following states: Delaware, District of Columbia, Maryland, Pennsylvania, Virginia, and West Virginia. The beneficiaries living in the remaining states and territories will receive their cards over the next year.

Important: Medicare is NOT contacting beneficiaries to verify information before mailing the new cards; they are being mailed automatically. To prevent being scammed, keep in mind that the ONLY time Medicare will call a beneficiary to ask for personal information is in 2 situations:

(1) A Medicare health or drug plan can call members of their plans.

(2) A customer service rep from Medicare can return a call when a beneficiary has called Medicare and left a message asking for a callback.

If you are not sure whether the caller is legitimate, hang up and call 1-800-MEDICARE (1-800-633-4227)

For more information about the new Medicare card, you can visit Medicare.gov.

 

What’s the difference between brand name and generic drugs?

During the Medicare webinar I presented yesterday for A.D. Banker & Company, we were talking about Medicare Part D and prescription drugs. When I explained the differences between brand name and generic drugs, nearly everyone was amazed that there were differences–they thought brand name and generic drugs had to be the same, but only with different names. Wrong.

One of my students suggested I write a blog post about the subject, so, thanks to her, here is some information you may not have known:

Brand name drugs are designed and manufactured by pharmaceutical companies that obtain patents for the drug. Once the company files for the patent, no other company can manufacture the drug for the term of the patent, which is 20 years from the date of filing. These drugs are issued two names: the brand name and a generic equivalent. For example, Tylenol® is the brand name drug and its generic equivalent is acetaminophen.

Generic drugs are similar, but not identical to brand name drugs. They’re required to have the same active ingredients and different inactive ingredients. Once the brand name drug’s patent expires, other companies are able to sell the generic equivalent. That’s why your RX migraine tablet is blue and round one month, and a different shade of blue and in an oblong shape the next month–your pharmacist used generic drugs from different manufacturers when filling your prescription.

Similarities

Brand name and generic drugs must:

a) Have the same ingredients

b) Have the same dosage strength and form

c) Be administered in the same way

d) Deliver similar amounts of the drug to the bloodstream

Differences

Brand name and generic drugs:

a) Must look different, as required by law

b) Must have different inactive ingredients

Generics may vary by manufacturer and usually cost less than their brand name equivalents because much the costs of R&D have been recouped by the original manufacturer during the 20-year term of the patent. Once multiple companies are legally permitted to sell the drug, the single company holding the patent now has competition, which causes the price to drop.

Sometimes the difference in inactive ingredients affects a patient, either because of their interaction with other drugs being taken or side effects. In this case, a doctor might prescribe the brand name drug, rather than its generic equivalent.

Click here to see what the FDA has to say about generic drugs. Obviously, I am not a doctor or pharmacist and you should direct your medical inquiries about the differences between brand name and generic drugs to the appropriate medical professional.

I hope you found this information interesting. Bet you didn’t know how easily so many things in our society affect the cost of insurance!