Policy


distracted drivingIf you haven’t heard yet, April is “Distracted Driving Awareness” month. Although we aren’t perfect, I think the majority of us consider ourselves to be excellent drivers. Every now and again, however, I think that we can all honestly say that there may be something that causes us to take our eyes off the road, even if it’s just for a few seconds. Whether it’s a text, an incoming call, or even your crying baby in the backseat, it’s a distraction none the less. Although texting is probably the most common thing that you hear about these days, surprisingly, it is not the number one reason with respect to distracted driving.

Using data collected from 2010 and 2011, an analysis was performed by an insurer out of Erie, PA. By using some of the top resources and information such as police report data in the Fatality Analysis Reporting System (FARS), a nationwide census of fatal motor vehicle traffic crashes maintained by the National Highway Traffic Safety Administration, and also the Insurance Institute for Highway Safety, the insurer was able to determine the top ten distractions involved in fatal car crashes.

Still think texting was the number one reason? Think again! The analysis reported that a whopping 62% of distracted drivers were either “lost in thought” or “generally distracted”….aka daydreaming. When I think about it, I can honestly say that I have definitely been guilty of daydreaming while at the wheel. With the busy schedules we keep and the hustle and bustle of getting from here to there, it’s easy to “zone out” while you are driving. Our minds are in a constant state of thought. Whether you are thinking about what you should make for dinner, wondering if you packed everything you needed for your weekend getaway, or simply trying to decide what exit you want to take, you are putting yourself, your loved ones, and others at risk. So the question now is how do you stop daydreaming and stay focused on the road? There are a number of things that you can do to accomplish this.

1 – Control Your Emotions: Do not let a fight with a friend or significant other interfere with your drive. Before you get behind the wheel, make the decision to put your emotions aside and make a plan. For example, tell yourself “When I get home, I’m going to call my friend Jenny to vent, because she gives good advice and perspective”.

2 – Pump Up the Jam: Put together a playlist or cd with music that gets you going. Songs that have 100-175 BPM (beats per minute) can help keep you alert.

3 – Let Some Air In: Open your windows. Seat warmers and heaters during the winter months, although cozy, can relax you right into the thought of being snuggled up in your own bed. Crack the windows, even if it’s just for a few minutes. Just like a cold shower can wake us up, so can a blast of cold air.

Whether it’s daydreaming, texting, or putting on your lipstick, there is no doubt that distracted driving is a growing epidemic. Be mindful of how you are feeling, both physically and mentally, before you start the ignition. Consider your drive a mission, even if it’s just to the grocery store, and get from point A to B in one piece. Carry on and drive safe!

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AccidentsMost of us know that each individual state requires that you carry auto liability insurance. In the state of Arizona, you are required to carry at the least 15/30/10. To break it down, what this means is that you have up to $15k (per person) and $30k maximum (per accident) for BI (bodily injury) should you cause injury to someone during an accident for which you are at fault. The $10k is the maximum coverage for PD (property damage) that was caused by you. Although your premiums for this type of coverage are very cheap and may be within your tight budget, there are several things to consider before making a quick, impulsive decision that might end up haunting you for the rest of your life.

The average cost of a vehicle these days is a little over $30k. Sure, you wouldn’t be responsible for the cost of a brand new vehicle if you caused an accident because we all know that the value of a car depreciates immediately after you drive it off of the lot. In fact, the average cost of an accident in which there is ONLY property damage was $9078 in 2011, according the AZ Motor Vehicle Department. You have $10k in coverage, no big deal, it’s just under your limit right? Keep in mind that this is an average figure only! This doesn’t guarantee that any damages caused by you won’t be over $10k. You should also consider that property damage is not just limited to someone else’s vehicle. You can damage a number of things…a lamp post, a yard, or even a house. PD coverage also pays for your legal defense costs if you are sued as a result of these damages and you don’t need to be an expert to guess how much that could run you.

Now it’s time to get serious and address bodily injury. If you have the required state liability limits in the state of Arizona, then you are covered up to $15k (per person) which maxes out at $30k (per accident). We all know that accidents happen and according to the AZ Motor Vehicle Department, the average cost per incident in 2011 in regards to BI was $22,746 and this was just for Non-incapacitating injuries. The average cost per incident for incapacitating injuries jumps to $70,854 and the average cost per incident for accidents that involved fatalities was $1,438,200. I don’t think anyone is in disagreement that 15/30 is definitely not enough BI coverage for anyone.

What can you expect if your insurance coverage comes up short? It’s simple really. If the amount of BI and/or PD exceeds the limits of your coverage, you are at risk of being sued. Depending on the amount in which you are sued for, you can potentially have your wages garnished for the rest of your life. Think for a moment of the victims as well. Not only have you disrupted your own life financially, mentally, and possibly physically, you have also disrupted someone else’s life in the same manner. Think of it in terms of your family and if the tables were turned. It’s not something we are necessarily comfortable thinking about, but what would the implications be if someone caused an accident involving you or your family members and they did not have the coverage to make you whole again? It’s a disturbing scenario.

We choose not to write state limits for any of our clients. It’s something that we feel strongly about and believe it is in the best interest of our clientele to carry liability limits of at least 100/300/100. If you currently have state liability limits, ask yourself “How much am I really saving in the long run?” There is no better time than now to get with your agent or insurance carrier to discuss increasing your auto insurance limits. Be safe, but most importantly, be protected! Call our office for a free quote today at 480-288-5900!

HomeOne of the most common questions that we are asked in our office is “Why is my dwelling coverage so high?”  We all know that the housing market is not where it used to be. This has been the case for some time and probably isn’t changing any time soon. So why does the insurance company insure your home for more than it’s worth?

Amongst other things, home insurance is there to protect you in event that there is a complete and total loss. Regardless of whether you would purchase a new home or rebuild your home, it doesn’t change the fact that the company who is insuring your home is just that….insuring your home. They aren’t necessarily insuring you to go out and purchase another home, but rather are insuring the home that you currently live in and the coverage is determined by how much it would cost to actually rebuild your home from the ground up.

Here are a few things to keep in mind when considering the differences between Replacement Cost and Market Value:

1. The Market Value for a home generally includes the value of the land on which the home sits. The Replacement Cost of a home does not include any land values, but is only concerned with the home itself.

2. The Market Value for a home is affected by changes in the real estate market. When homes in a particular area are in high demand the Market Value of a home in that area will generally go up. In the same way, when demand for homes in a particular area is low, the Market Value of homes in that area may remain level or even go down. Replacement Cost is not affected by the real estate market but is instead affected by the fluctuations in material and labor costs to build a home. For example, if the cost of material such as lumber, concrete, drywall, and carpet are higher in a particular area, then the Replacement Cost of a home in that area will be higher than the Replacement Cost of the same home in an area where materials are less expensive.

3. The Market Value of a new home generally factors in the cost that was required to build the home new. Replacement Cost, however, is looking at the cost to re-build the home, if it were completely destroyed, using all of the same materials and construction techniques originally used to build the home. The cost to build a new home can be quite different from the cost to re-build a pre-existing home due to access issues, labor efficiencies, economies of scale, debris removal and higher price of materials that may no longer be in common use (such as lath and plaster vs. drywall).

When insuring a home, we always use the Replacement Cost of the home to determine the amount of insurance required as this is what it will cost to replace or repair the home should it be damaged or destroyed. Understanding your coverage and what it means for you is just one of the many things that we offer here at Canyon Lands Insurance. If you are interested in a free quote, please visit our website at http://www.canyonlandsagency.com or give us a call at 480-288-5900. Hope to hear from you soon!

These days you can buy nearly anything online, even your insurance.  Although it may seem like you are saving time and money by obtaining a policy online, it may not be so convenient later.

One of the biggest advantages of working with an agent is that they have time to sit down and talk with you, in turn allowing you to establish a one on one relationship.  Just one visit with an agent can prove to be beneficial in respect to knowing what your options are and choosing the best possible coverage that fits your needs.  In addition to this, based on your answers to a few simple questions, an agent is able to find possible discounts that you may be qualified to receive.  Purchasing insurance can sometimes be stressful and an agent can alleviate some of that stress, if not most of it just by understanding and being able to relate to you.  After all, we are human and it’s comforting to know that someone has your best interest at heart.

Ben Franklin said it best, “Time is money”. Although an online agency provides you with a phone number where they can be reached, you may not be able to speak with a live person. I’m sure that we have all experienced the downfalls of 800 numbers and the “customer service” they provide.  One could spend 30 minutes or more being looped from one automated message to the next only to reach a live person who ends up transferring you somewhere else. Being able to reach your agent by phone without having to guess which automated option to choose can save you both time and aggravation.

One final advantage to working with an agent who is local is that they can work with you in regards to your coverage.  They can adjust your limits and/or deductibles without sacrificing the important coverage that you need resulting in a policy that is tailored just for you and your pocketbook.   Online agencies give you the freedom to choose the coverage you want according to what you can afford, but an agent can recommend coverage that will protect you and your family all while keeping you within your budget.

For example, the required liability coverage amounts in the state of Arizona are 15/30/10.  Sure, you may get a huge savings up front, but will you pay for it in the end?  If you cause an accident which results in bodily injury more than $15,000 or property damage more than $10,000, you are financially responsible.  Just to give you an idea, according to the National Safety Council, the average cost of injury in a car accident is $61,600 and the average price of a new vehicle is a tad over $30,000 according to Forbes.  Saving a couple of dollars by reducing coverage could cost you thousands in the long run.

With all of the decisions that you make in life, don’t let choosing the right policy overwhelm you when you have an agent right who is right around the corner.  Make an appointment today by calling us @ 480-288-5900.  We can help you protect what matters most!

Builder's Risk Insurance

Do you need Builder's Risk Insurance? Photo credit: monivhs1947 on Flickr

Builder’s risk coverage falls under the category of specialty insurance products and provides property insurance for buildings while they are still being built.  Standard property coverage would not cover damage to the building while it is under construction.    Once the building is complete, the property owner would purchase a more standard property insurance policy to cover any damage to the building.  It is kind of like a homeowner-to-be who has to get a construction loan in order to finance the cost of building a house and then get a mortgage once the house is complete.

This type of insurance also covers materials and equipment that are being used to construct the building and may be purchased to cover any loss exposure during renovations, not just for new construction.

Who Needs Builder’s Risk Insurance

During construction, the conditions are very different than they will be once the building is complete and there are more ways that losses can occur.  Building owners are generally liable for anything that happens on their site.  Builder’s risk offers the owner some protection from any loss of property.

What Does it Cover

Most Builder’s Risk coverage protects the land/building owner’s interest against losses resulting from fire, vandalism, lightning, wind, and other non-excluded weather conditions.  Similarly to homeowner’s insurance, Builder’s Risk policies do not generally protect against losses caused by earthquakes, flooding, acts of war, or intentional damage caused by the owner.   The timeframe of the policy generally aligns with the timeframe of the construction or renovation and expires once the work on the building has been completed.  Builder’s Risk coverage would not usually continue to offer protection to the owner after the building is certified for occupancy.

The standard Builder’s Risk policy offers site-specific coverage which means that any materials and equipment that are not onsite would not be covered under the policy.  If there are materials and/or equipment that is being stored in a different location for use on the project, a broader policy would be required.  This type of coverage can be obtained through a Builder’s Risk policy that contains Inland Marine provisions.

Although the type of coverage provided at a high level is common across the majority of Builder’s Risk policies, the actual policies are often very detailed and tailored to the specific needs of the building project that is being insured.  This ensures that the policy meets the specific needs of the individual project but also requires that the building owner and any other interested parties pay close attention to what is covered and not covered by the policy.

Who Buys Builder’s Risk Coverage

In most cases, the owner of the building being constructed would purchase the Builder’s Risk policy.  In some circumstances, building owners may require that the general contractor or the company completing the construction secure this kind of coverage as part of the contract to build the building or complete the renovation.

Sometimes, the existing property insurance will cover any losses during building renovations or while an addition is being built.  However, it is important for the building owner to verify that coverage with their current carrier prior to any work being done.  If the renovation or addition is covered by an existing property insurance policy, there is no need to purchase an additional Builder’s Risk policy.

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Earthquake

Are you protected in the event of an earthquake? image via martinluff on Flickr

No matter where in the U.S. you live, there is a chance that there could be an earthquake in your area.  Of the 50 states, there are only 8 that haven’t experienced a single earthquake in the last 30 years according to the United State Geological Survey (USGS).  But even those states that have been safe the past thirty years are not immune from quakes or from damage caused by quakes occurring in adjoining states.  The simple fact is, if you live in the U.S., you run the risk that an earthquake will cause damage to your home.   If that happens, the only way that your insurance company will pay for the damage is if you have purchased additional coverage specific to earthquakes.

For those living in Hawaii, Alaska, and California, the three most seismically active states, earthquake insurance may seem to be a requirement.  However, even in those states, many homeowners haven’t purchased the extra coverage that would protect them from large losses.  According to the California Earthquake Authority (CEA), which provides the majority of earthquake coverage to California homeowners, only 12% have purchased earthquake coverage.   In Alaska, which is one of the most seismically active areas in the entire world, this number is only a little higher at about 33%.

Why Don’t Homeowners in High Risk Areas Buy Coverage

There are several reasons that even homeowners in Alaska and California don’t have earthquake insurance.  Unfortunately, one of the main reasons is that there are still people who believe that their homeowner’s policy will cover any losses resulting from an earthquake.  In almost every case, this simply isn’t true.  Other homeowners have made the conscious decision not to purchase this additional coverage because they feel the cost of the coverage plus the high deductible that is standard on earthquake policies makes the coverage unaffordable.  Still others believe that if there is a disaster, the government will be there to help make them whole and help them rebuild their house.

So, Why Do I Need it?

There are four reasons that every homeowner should look into purchasing an earthquake policy, even those who live in states that are not high on the earthquake risk list.

1.     If you live outside the big three, coverage is likely much less expensive than you think.

2.     Houses outside of the big three are rarely built with earthquake resilience in mind.  This means that if there is an earthquake, there is likely to be more damage to structures and property than there would be in California, Alaska, or Hawaii.

3.     It doesn’t take a catastrophic quake to cause catastrophic losses.

4.     Between 2001 and 2011, the USGS reports that there were more than 40,000 earthquakes in the U.S., almost 5,000 of which did not occur in the big three states.

5.     FEMA estimates that a major earthquake in a city with a large population could result in damages exceeding $200B.  Without insurance, you will be completely reliant on federal and state disaster relief for any assistance.  As the average award individual/family falls between $2,000 and $4,000 per family and the maximum grant is less than $15,000, you will be hard pressed to rebuild and recover.

Earthquake insurance is the kind of thing that it is easy to convince yourself you don’t need… until you do.  Then, it’s too late.

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Marriage

Are you properly insured after a major life-changing event? Image via cheesy42 on Flickr

Many people don’t realize that different life events can have an impact on their insurance needs as well as their insurance premiums.  You might think that turning 25 will bring your auto insurance down or realize that getting married means you need to combine your coverage into a single policy, but there are many other ways that major life events can impact your insurance.   A survey conducted by Trusted Choice and reported in Insurance Journal found that more than 30 million U.S. households have insurance policies and/or coverage that don’t fit their current needs.

Here are 3 of the major life events that can change what kind of insurance you need, how much insurance you need, or how much your insurance costs.

1.     Getting Married

When you tie the knot, your insurance needs and costs can change in a couple different areas.  First, your car insurance rates may go down because you are married and combining policies may qualify you for a multi-car discount.  If you are purchasing a house, you will need a new homeowner’s policy.  If you are moving in together but renting, you will want to combine your renter’s insurance and make sure the coverage limits of the policy are enough to replace both of your possessions.  Regardless of whether you are a renter or a homeowner, you may want to make sure your property replacement coverage will cover your wedding rings.  Finally, now that you are married, your life insurance needs may be drastically different and should be reviewed.  Even if you have enough insurance, you will likely need to make beneficiary changes at a minimum.  Talk to your insurance agent to make sure the coverage you have is the coverage you need and that you aren’t paying more for it than you should be.

2.     Getting Divorced or Becoming Widowed

A change in marital status can mean that you need to make changes to your insurance coverage.  Going from two cars to one, moving to a smaller house, selling valuables, and splitting assets can all result in the need for less coverage and lower limits.  This can be a big cost savings for you that you may not think of during such a difficult time.  You will also want to change any beneficiaries on life insurance or other policy payouts.

3.     Having Children

Becoming a parent for the first time or the last time is a big change and it can mean you need to make changes to your insurance coverage.  According to a life insurance fact sheet put out by LIMRA, almost 70% of U.S. Households with children under 18 would be in jeopardy and destabilized financially if the primary bread winner died.    If you have added a new family member by birth or adoption, it is a good idea to sit down with your insurance agent and make sure you have enough life insurance coverage to meet the needs of your family and that beneficiaries are designated properly.  You may also want to review your auto and home insurance policies to ensure that coverage limits are adequate for your larger family.

While these are 3 of the major life events that can affect your insurance costs and needs, there are several other events that should trigger a review of your policies with your agent.  If you have a new teenage driver, buy a vacation home, have a significant change in income, buy or inherit valuable property, or as you get ready to retire, sitting down with your agent can make sure you and the ones you love are protected.
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