Tag: insurance

Which Financial Steps Should I Take After a Divorce?

by Advantage One, posted in Budgeting, Lifestyle, News & Events, Saving, Tips & Best Practices, Uncategorized

Q: I’m going through a divorce, and one of my biggest stressors is identifying how I’m going to deal with my finances on my own. What steps do I need to take to ensure ongoing financial stability after a divorce?

A: Divorce can be difficult on many levels, and one of the most formidable challenges for most is the financial strain it causes. Making sense of your finances after a divorce takes work and time, but with proper planning and a responsible approach, it can be done. 

Here are 10 financial steps to take after a divorce:

1. Close all joint accounts

If you haven’t already taken this step, do so immediately. Review all your financial accounts and credit cards and close all the ones that are jointly owned by you and your ex-spouse. In the best-case scenario, failure to take this step can leave your accounts open to fines and maintenance charges for accounts you don’t really use. In the worst-case scenario, your ex-spouse can rack up huge bills on a shared credit card or leave a shared checking account in the red, leaving you to pick up the tab or risk ruining your credit score and financial health. 

2. Change beneficiaries on your savings and retirement accounts

This step is equally important and is also often forgotten about by divorced individuals until it’s too late. Neglecting to change the beneficiaries on your accounts after a divorce can mean your ex-spouse ends up inheriting your IRA, 401(k) or another savings account after you pass away. Changing the beneficiaries on each relevant account can be done quickly and easily with a single form. Look for the designation of “primary beneficiary” and “contingent beneficiary” on each account’s form and list your choice. 

3. Review your living trust and make any necessary changes

Don’t wait to review your living trust and estate plan or you may never make the necessary changes. Speak to your attorney for guidance. If your ex-spouse is the one who primarily dealt with the attorney and you’re looking for a new start, you can ask friends and family to recommend a new attorney you can use. 

4. Open new accounts

Once the divorce is finalized, you’ll want to open new accounts with your name exclusively listed as the owner. This includes credit cards, checking and savings accounts. Once you have new credit cards in your name, take steps to build up your credit quickly, like making regular, small purchases on your cards and paying the balance in full each month.

5. Update your insurance coverage

You don’t want to get stuck paying for coverage you don’t use — or worse, get stuck with no coverage at all. Review all your insurance policies, including life, health, auto and homeowner’s insurance, then change any plans that were shared with your ex-spouse. Pay particular attention to assets you may have listed in your homeowner’s policy as you may not own all of them any longer and each asset can increase your premium. Now that you are on your own, you may also want to consider taking out a disability insurance policy, which will provide you with the monthly equivalent of a paycheck if you become injured and are unable to work for an extended period of time. 

6. Build an emergency fund

Divorce is often expensive, and you may have wiped your savings clean after splitting up with your ex. Now that you are single again, it’s more important than ever to have a safety net that can tide you over in case of an emergency. You can open a new savings account at Advantage One Credit Union for just this purpose and save aggressively until you have enough to cover three to six months’ worth of expenses.

7. Adjust your budget to fit your new financial situation

You may have lost one stream of income in the divorce, but your everyday expenses will likely be considerably lower. On the other hand, you may have new expenses to cover, such as alimony and child support. Take the time to sit down and determine how your income and expenses have changed after the divorce, and then adjust your budget accordingly. 

8. Update all legal documents and records

If you’ve changed your legal name during the divorce, be sure to change the name of record on all your legal documents and accounts, including your driver’s license and Social Security number. You can contact your local DMV and the Social Security Administration for assistance. 

9. Purchase a new safe and shredder

If your ex walked away from the divorce with the safe and shredder, be sure to replace them as quickly as possible. A home safe is the best place to keep valuables and important documents, and shredding any documents containing sensitive information that you no longer need is an important part of protecting yourself from identity thieves.  

10. Analyze your investments

If your ex-spouse handled all the investing in your marriage, you’ll need to analyze your investments and create a new portfolio that fits your own investment style and needs. Consider working with an investment advisor for guidance.

Getting divorced can spell disaster for your finances, but it doesn’t have to be that way. By taking the steps outlined here you can keep your financial independence after a divorce.

Your Turn: Which financial steps have you taken after a divorce? Tell us about it in the comments. 

Step-by-Step Guide for Buying a Motorcycle

by Advantage One, posted in Budgeting, Credit, Lifestyle, Loans, Saving, Tips & Best Practices, Uncategorized

If you’re ready to purchase your first motorcycle, you’re likely thrilled — and more than a little overwhelmed. There are so many factors to consider and dozens of choices you’ll need to make before you pull the clutch. It can all get confusing, fast!

No worries; Advantage One Credit Union is here to help. We’ve compiled a step-by-step guide for buying a motorcycle, complete with useful tips to help you make a purchase you’ll enjoy for years to come. 

Secure financing

A motorcycle can run you anywhere from $2,000 to $16,000, and it’s always best to have the financial details of a large purchase squared away before entering the market so you’ll avoid disappointment later. You can save up for your bike, charge it to a low-interest credit card or take out an unsecured loan from Advantage One Credit Union, where you’ll enjoy affordable interest rates and payback terms to fit your budget. 

Brush up on your motorcycle safety

Before you shop for a bike, it’s a good idea to complete a Motorcycle Safety Foundation (MSF) course. The course is similar to driver’s training and will help ensure you can ride your bike with increased safety. Depending on your state, you may need to obtain a special motorcycle license as well. 

Procure insurance

In some states, motorcycle insurance is required by law, but even if your state does not mandate it, consider purchasing coverage anyway. Insurance will protect you from liability for property damage or personal injuries caused through your vehicle, help cover medical bills in case of an accident, and cover theft and damage to your bike as well. As is the case with auto insurance, you’ll have the freedom to choose how much coverage you’d like to purchase, with more robust coverage directly increasing the cost of your policy. 

Choose between a new and used bike

You’ve got the important stuff taken care of and you’re itching to try out bikes, but before you do, decide if you’re going to purchase a new or used motorcycle. Let’s take a quick look at the pros and cons of each option. 

A used motorcycle can cost thousands less than a new bike and won’t depreciate nearly as much, but finding a used motorcycle in decent condition can be challenging. If you decide to go this route, stay away from bikes that show signs of excessive wear, have mileage exceeding 20,000 miles, and/or have difficulty starting up, running or stopping. It’s also a good idea to get a VIN (Vehicle Identification Number) to check on your potential new bike, have it professionally inspected, and take it for a spin before finalizing the deal. 

A new bike will be blessedly free of mechanical breakdowns in the near future and will look nice and shiny. Of course, you’ll pay for these privileges, so be sure to run the numbers before setting your heart on a particular motorcycle. It’s also important to note that, while you might save on repairs and maintenance, insurance on a new bike will likely be a lot more expensive than coverage for a used one.

Choose a motorcycle type

You’re ready to choose your type of ride. Here are the most popular choices:

  • Sport bikes- equipped with a leaning design that makes them ideal for riding at high speeds, these bikes also have higher foot-pegs and handlebars that are more out of reach than most other bikes. A sport bike can be a good choice for thrill-seekers, but an uncomfortable option for riders planning to take long trips on their bikes. Insurance can also be expensive. 
  • Standard bikes-an upright riding posture and lack of accessories make these a great all-purpose motorcycle. Perfect for beginners and the budget-conscious, but not the best choice for off-road and long-distance riders. 
  • Cruisers-the Harley Davidson standard, cruisers offer a relaxed riding position, comfortable suspension and a V-twin engine. They also tend to be heavy, making them difficult for new or small riders to handle, but an excellent choice for tall riders and those seeking a stylish ride. 
  • Touring bikes-built for long rides, these motorcycles are fully loaded with extra features, including fairings that block the wind, saddlebags to accommodate luggage and large fuel tanks for long trips. A touring bike can be ideal for riders who take lots of road trips, but they can be an expensive choice for city riders. 
  • Dual sport bikes-lightweight and built with high-travel suspension and aggressive tires, these bikes are a great choice for off-road riding. Their tall seat height makes them difficult for short riders to handle.

Once you’ve chosen your ride type, research models from popular brands, including Yamaha, Harley Davidson, Suzuki, Kawasaki, Honda and Triumph. Be sure to check out ratings and reviews from current owners. Once you’ve narrowed down your choice, you’re ready to visit dealerships and private sellers.

Important features to consider

A motorcycle’s seat, handlebars and foot-pegs are not adjustable, so it’s important to choose one that fits comfortably. Take a seat on any bike you are considering. See how it feels, and make sure you can easily reach the handlebars and pedals. If possible, go for a ride around town to get a real feel for it. 

You’ll also want to consider the weight of your bike since a heavier bike can be difficult to maneuver. 

Finally, if you’re a new rider, don’t go overboard on power. It’s best to start with a bike that has a 500cc engine and then trade- in for something more powerful later on, if necessary. 

Choose your bike and finalize your purchase

You’re ready to buy your bike! Be sure to choose carefully and do lots of research so you’ll enjoy your motorcycle for many happy miles. 

Your Turn: Have you recently purchased a motorcycle? Share your tips and advice with us in the comments. 

The Comprehensive Guide to Insurance Coverage

by Advantage One, posted in Budgeting, Credit, Debit, Lifestyle, Saving, Tips & Best Practices, Uncategorized

Insurance premiums can take a big bite out of a monthly budget, but not having enough coverage can be even more costly.  Let’s take a look at the five primary insurance types and the most important information to know about each one.

1. Health insurance

What is it? 

Health insurance is coverage that typically pays for medical, surgical and prescription drug expenses in exchange for a monthly premium. Many states mandate health insurance coverage and will collect fees, along with state taxes, from taxpayers who do not have sufficient coverage.

Types of health insurance plans

Health insurance plans are divided into two primary categories: public and private.

Public health insurance is provided at low or no cost through the federal and/or state government. The most common public insurance plans are:

  • Medicaid – Public insurance plan for low-income families and individuals. Eligibility requirements vary by state.
  • The Children’s Health Insurance Program (CHIP) – A federal and state program designed to cover children below the age of 18 whose families have incomes above the qualifications for Medicaid, but are too low to afford private health insurance.
  • Medicare – A federal health insurance program for Americans age 65 and older.

Private health insurance may be provided through an employer or purchased privately from the insurance provider, or through a broker.

These are the most common private health insurance plans:

  • HMO: Health Maintenance Organization – The most restrictive plans that only work with a network of healthcare providers. The insured must choose a primary care physician (PCP) who is in the network to benefit from coverage. To see an out-of-network specialist, the insured will need a referral from their PCP. HMOs tend to have cheaper premiums than other health insurance plans.
  • PPO: Preferred Provider Organization – The most flexible health insurance plans, which allow the insured to choose an in-network doctor at a lower cost, or an out-of-network doctor at a higher cost. There is no referral necessary to see a specialist. Premiums are generally more expensive than other plans.
  • EPO: Exclusive Provider Organization – A blend of HMO and PPO plans, EPOs do not cover out-of-network physicians, but do not require referrals for specialists. Premiums on EPOs fall between HMOs and PPOs.
  • POS: Point of Service – Another blend of HMO and PPO plans, POS plans will require a PCP on an HMO-style network, while also allowing out-of-network options at a higher cost. A referral is required for specialists. Premiums are generally more expensive than HMO plans but less expensive PPOs.

2. Life insurance

What is it?

Life insurance is a contract between an insurance company and a policyholder that guarantees a sum of money to the policyholder’s designated beneficiaries when the policyholder dies, in exchange for monthly premiums paid during the insured’s lifetime.

Types of life insurance

These are the five most common kinds of life insurance plans:

  • Term insurance – The most basic form of life insurance, with a predetermined term, usually ranging from one to 10 years. Plans are renewable at the term’s end, but the premiums will increase with each renewal. Term policies generally have the cheapest premiums, but no cash value.
  • Whole life insurance – Offers policyholders a cash-value component coupled with increased protection. Premiums can be locked in throughout the term, and a portion of premiums goes toward the policy’s cash value. The insured can borrow up to 90% of the cash value, tax-free, but loans reduce the policy’s death benefit.
  • Universal life insurance – Offers increased flexibility for policyholders. Premiums can go up or down, or even be deferred within certain limits. Cash values can be accessed and withdrawn, though this directly decreases the death benefit. Face values can be modified as well.
  • Variable life insurance – Fixed premiums and investment options make this policy the choice for true risk-takers. The policyholder’s cash value will be invested in the insured’s choice of stock, bond or money market portfolio. Cash values and death benefits will fluctuate along with the investments’ performance. These policies usually have higher fees than universal life insurance, but all cash value accumulation grows tax-free.
  • Universal variable life insurance – A blend of universal and variable life insurance, these policies offer flexible premiums and the ability to modify face values, along with investment options.

3. Auto insurance

What is it? 

Auto insurance is a contract between a policyholder and insurance company, protecting the policyholder from financial loss in the event of an auto accident or theft. The coverage is provided in exchange for a monthly premium. Some form of auto insurance is required in all 50 states.

Types of auto insurance policies

These are the primary categories of auto insurance coverage:

  • Liability coverage – Includes coverage for bodily injuries, property damages or auto damages to another motorist if the policyholder is at fault.
  • Comprehensive coverage – Pays for damages and losses to the car that were not caused by another driver.
  • Personal injury protection – Covers medical bills for the policyholder and their passengers in the event of an accident.
  • Collision insurance – Covers damages to the policyholder’s car if it’s involved in an accident.
  • Uninsured/under-insured motorist protection – Pays for damages caused by another motorist who does not have sufficient (or any) coverage.
  • Gap insurance – Pays the difference between what the policyholder owes on a financed or leased vehicle and what it is valued at when there’s a total loss of the vehicle.

4. Long-term disability insurance

What is it?

Long-term disability insurance is an insurance policy that provides income replacement for workers if they are unable to work due to a debilitating illness or injury.

Types of long-term disability insurance

There are two primary types of long-term disability insurance policies:

  • Own-occupation disability insurance defines a disability as an inability to work at your regular occupation. Benefits are paid even if the policyholder can work at another job.
  • Any-occupation disability insurance defines a disability as an inability to work at any occupation. These plans are generally cheaper, but claiming benefits can be more difficult.

5. Homeowners/renter’s insurance

What is it?

Homeowners insurance is a policy designed to protect homeowners and their families from liability and financial loss in case of damage to their home and belongings in exchange for monthly premiums. Renters insurance is purchased by tenants and only covers damage or theft of their personal property.

Types of homeowners insurance policies

  • HO-2 – A policy that only protects against 16 specified perils.
  • HO-3 – A broad policy protecting against all perils other than those excluded in the policy.
  • HO-5 – A premium policy that usually protects newer homes and covers all perils, except the few excluded in the policy.
  • HO-6 – Insurance for co-ops/condominiums, which includes personal property coverage and liability coverage.

Each plan type will also include some extent of liability coverage. Most policies will only cover events if they are sudden and accidental. Some natural disasters, like earthquakes and floods, require a separate policy for coverage.

Types of renters insurance policies

Renters insurance policies will generally fall within either:

  • Replacement-cost plans – Will pay for the full cost of replacing your damaged or stolen belongings up to a predetermined cap. This plan offers more robust coverage, but premiums are generally higher.
  • Cash-value plans – Will only offer payouts to cover what the damaged item was worth at the time of the disaster.

Insurance is a big part of financial responsibility. Use our guide to help you make the right choices in all major types of insurance coverage.

Your turn: What are your best tips for buying insurance?

Learn More:
policygenius.com
smartasset.com
iii.org
allstate.com
nerdwallet.com
investopedia.com

How will my Insurance Premiums be Affected by a Car Crash?

by Advantage One, posted in Budgeting, Tips & Best Practices

two men involved in a minor car accident exchange insurance informationQ: I’ve recently been involved in a car crash and I’m wondering what to expect as far as my insurance rates. How big of an increase can I expect to see in my monthly premiums?

A: In most cases, car insurance providers will add a surcharge to your monthly premiums following a car accident involving one of the drivers on the plan; however, the exact increase you’ll see, and whether you will see one at all, varies by the driver, insurance carrier and state.

Here are the answers to all your questions regarding vehicle accidents and insurance rates.

What should I do after an accident?
If you’ve been in a car accident, you may be wondering whether you should involve your insurance provider and the authorities at all. If only minor vehicle damage was sustained in the accident at costs that are below or just above your deductible, it may be smarter to pay for the repairs on your own and not to involve your insurance provider. Before you decide to take this route, though, check your policy to see if there is a caveat requiring you to report all accidents.

When you need to file an insurance claim, you’ll also have to file a police report. Be sure to do so as soon as possible after a vehicle accident. You can find the information needed for filing an insurance claim on the insurance documents that you should have in your vehicle at all times. Exchange the following information with the other driver while still at the scene of the accident:

  • Name of driver
  • Name of car owner
  • Names of any passengers in the car at the time of the accident
  • The vehicle make, model and license plate number
  • The driver’s insurance company name, policy number and contact number for claims filing
  • If the police are at the scene of the accident, ask for an official police report right then as well. If you are incapacitated because of the accident, you may need to do some follow-up work when you are back on your feet to get this information. You should be able to access it through your local police department.

How much of an increase in my monthly premiums can I expect to see after an accident?
The exact increase (if any) you will see in your monthly premiums depends largely on what kind of accident you were involved in and whether you were at fault. Other factors that come into play when determining this number include your particular policy and the state where you live. Another crucial point that insurance providers consider is whether this is your first at-fault accident while on the plan. Some providers will allow one minor accident to slide without any lasting impact, while a second crash can raise your rates up to a whopping 80 percent.

A joint study between Insurance Quotes and Quadrant Information Services, which looked at data in all 50 states, found that drivers who made a single insurance claim worth $2,000 or more saw their premiums increase on average by 44.1%, or $371 a month.

Is there any way I can guarantee that my insurance provider will look away from the accident?

If you’ve been with the same insurance provider for a while, you may qualify for accident forgiveness, or a program many insurance providers offer in which they waive the usual post-accident surcharge for qualified drivers. In general, only drivers who’ve been insured by the carrier for a lengthy period of time and who have excellent driving records will be eligible for this free program. Some carriers allow other drivers to join the program for an additional monthly fee. If you are not enrolled in accident forgiveness and you think you may be eligible, speak to a representative of your insurance company to see if you can enter the program.

What if the accident isn’t my fault?
If you’ve been involved in an accident that was clearly not your fault, your rates may or may not increase, depending on your carrier, state and whether this is your first no-fault accident. If you’ve been involved in several no-fault accidents, you may see a significant increase in your premiums. Your insurance provider can also refuse to renew your policy at the end of its life.

Will the car accident affect my credit score?
Your accident and the consequent higher insurance premiums will not affect your credit rating; however, a lower credit score can result in higher monthly premiums, and the reverse is true as well.

Is there any way I can lower my rates after a surcharge?
Implement some or all of these tips to lower your rates:

  • Improve your credit score. Increasing your credit score by paying your bills on time, keeping your credit utilization low and working on paying down your debts can help you earn a lower insurance rate.
  • Increase your deductible. If your insurance premiums have become unaffordable, you may want to increase your deductible. It will mean paying more out of pocket if you are involved in another accident, but you’ll be able to lower your monthly premiums to a more affordable rate.
  • See if you qualify for any discounts. Lots of car insurance companies offer rate discounts for customers who qualify for a specific criteria, such as a multi-policy discount for bundling different kinds of insurance policies, or a good student discount for students who maintain a high academic average in school.
  • Shop around for another policy. If you can’t find a way to lower your premiums, you can look into rates being offered by other carriers. With a bit of research, you might find a provider offering a much better rate for the same amount of coverage.

Your Turn:
Have you recently been involved in a car accident? Tell us how your insurance premiums were affected in the comments.

Learn More:
bankrate.com
carinsurance.com
thesimpledollar.com
moneyunder30.com

5 Ways to Trim Your Fixed Expenses

by Advantage One, posted in Budgeting

Monthly expense sheet with glasses and claculator on deskWhen trying to trim a monthly budget, most people don’t consider their fixed expenses. These recurring costs, which include mortgage payments, insurance premiums and subscription payments, are easy to budget and plan for since they generally remain constant throughout the year. While people tend to think there’s no way to lower fixed expenses, with a bit of effort and research, most of these costs can be reduced.

Here are five ways to trim your fixed expenses.

1. Consider a refinance
Mortgage payments take the biggest bite out of most monthly budgets. Fortunately, you can lower those payments by refinancing your mortgage to a lower interest rate. The refinance will cost you, but you can roll the closing costs and other fees into your refinance loan. Plus, the money you save each month should more than offset these costs. A refinance is an especially smart move to make in a falling-rates environment or if your credit has improved a lot since you originally opened your mortgage.

2. Lower your property taxes
Taxes may be inevitable, but they aren’t set in stone. You may be able to lower your property taxes by challenging your town’s assessment of your home. Each town will have its own guidelines to follow for this process, but ultimately you will agree to have your home reappraised in hopes of proving its value is less than the town’s assessment. This move can drastically lower your property tax bill; however, if you have made improvements to your home, it may be appraised at a higher value, which could raise your taxes.

3. Change your auto insurance policy
The Geico gecko and Progressive’s Flo, who love disrupting your favorite TV shows, actually have a point: You may be overpaying for your auto insurance policy.

If you’ve had the same policy for several years, speak to a company representative about lowering your monthly premiums. By highlighting your loyalty and having an excellent driving record, you may be able to get a lower quote. You can also consider increasing your deductible to net a lower monthly premium.

If your insurance company is not willing to work with you, it might be time to shop around for a provider that will. A few minutes on the phone can provide you with a significant monthly savings for a similar level of coverage. Once you have a lower quote in hand, you can choose to go back to your original provider and tell them you’re seriously considering a switch; they may change their mind about their previous lowest offer.

4. Consolidate your debts
If you’re carrying a number of outstanding debts, your minimum monthly payments can be a serious drain on your budget. Plus, thanks to the high interest rates you’re likely saddled with, you might be feeling like that debt is going nowhere.

Lucky for you, there is a way out. If you have multiple credit cards open, each with an outstanding balance, you might want to consider a balance transfer. This entails opening a new, no-interest credit card, and transferring all of your debts to this account. The no-interest period generally lasts up to 18 months. Going forward, you will only have one debt payment to make each month. Plus, the no-interest feature means you can make a serious dent in paying down that debt without half of your payment going toward interest.

Another way to consolidate debt is to take out a personal loan at Advantage One Credit Union. Our personal loans will allow you to pay off all of your credit card debt at once. You’ll only need to make a single, affordable monthly payment until your loan is paid off.

5. Cut out subscriptions you don’t need
Another fixed expense most people mindlessly pay each month are subscriptions. Take some time to review your monthly subscriptions and weed out those you don’t really need. Below, we’ve listed some of the most commonly underused monthly payments:

  • Gym membership
    Are you really getting your money’s worth out of your gym membership? It may be cheaper to just pay for the classes you attend instead of a full membership. Or, if you have a favorite workout machine at the gym, consider purchasing it to use at home for a one-time cost that lets you to drop your gym membership.
  • Cable
    Why are you still paying for cable when you can stream your shows for less through services like Netflix and Hulu? If you don’t want to cut out cable entirely, consider downgrading to a cheaper plan that drops some of the premium channels you don’t watch much.
  • Apps
    How many apps are you signed up for? You may not even remember signing up for an upgraded version of an app you rarely use. A quick perusal of your monthly checking account statement or credit card bill can help you determine how much these subscriptions are costing you. Drop the apps you’re not using for more wiggle room in your monthly budget.

Your fixed monthly expenses are actually not as “fixed” as you may have thought. By taking a careful look at some of these costs, you can free up more of your monthly income for the things that really matter.

Your Turn:
How have you lowered your fixed monthly expenses? Share your best tips with us in the comments.

Learn More:
debtroundup.com
experian.com
thesimpledollar.com

Your Complete Guide To Renter’s Insurance

by Advantage One, posted in Lifestyle

Nicely manicured female hand with expensive pen signing rental insurance policy agreementQ: I’ve just signed a lease on a new apartment and I’m wondering if I should be taking out a renter’s insurance policy as well. What do I need to know?

A: Purchasing a renter’s insurance policy when signing a lease on a new apartment is a good idea.

Thanks to rising market prices and stricter loan qualifications, more people are choosing to rent living space instead of buying. Renting affords you mobility and the freedom from stressing over costly household repairs and maintenance.

One downside to renting, though, is if something catastrophic happens to your rental property, your landlord bears no responsibility toward having your damaged belongings replaced or repaired. This is where renter’s insurance comes in.

Renter’s insurance involves paying a monthly premium toward coverage against financial responsibility and liability in the event of an accident, theft or natural disaster. Specifically, renter’s insurance offers three aspects of financial protection: coverage for personal possessions, liability protection and additional living expenses (ALE).

Renter’s insurance is fairly inexpensive and the payoff can be tremendous. The National Association of Insurance Commissioners estimates the average monthly premium for renter’s insurance is $15-$30 a month. When you think about the peace of mind and financial cushion renter’s insurance provides, taking out a policy is a no-brainer.

Despite its convenience, renter’s insurance policies can be confusing to navigate. No worries, though, [credit union] will walk you through it!

Read on for all your questions about renter’s insurance answered.

Should I choose replacement-cost coverage or actual cash-value coverage?
You can choose to purchase a policy that covers the cost of replacing a damaged or stolen object, or one that offers you the actual cash value of the damaged or lost item(s). To illustrate, if your flat-screen TV is stolen, a replacement-cost coverage plan will fund the purchase of a new TV, while a cash-value coverage plan will only pay you what the used TV was worth at the time of the theft.

Replacement-cost plans will have pricier premiums, but the robust coverage they offer is usually worth the extra expense.

How much coverage do I need?
When considering policies, you’ll need to decide how much coverage you actually need. Each policy will offer coverage to replace your possessions up to a certain limit. It’s best to take out a policy that will protect the full value of your belongings.

The only way to determine how much coverage you actually need is to take a complete inventory of your assets. If you’re choosing a replacement-cost plan, you’ll need to note how much it would cost to replace each item. If you’re going with a cash-value plan, note each item’s current worth. Tally up the total and, when purchasing a policy, be sure to choose one that provides sufficient coverage for your belongings.

Are all disasters covered by renter’s insurance?
Most renter’s insurance will cover damage caused by the following circumstances:

  • Fire or lightning
  • Accidental discharge or overflow of water or steam from an appliance or plumbing system
  • Freezing of a plumbing system or of a household appliance
  • Windstorm or hail
  • Explosion
  • Riot or civil commotion
  • Damage caused by aircraft
  • Damage caused by vehicles
  • Smoke
  • Vandalism
  • Theft
  • Volcanic eruption
  • A falling object
  • The weight of ice, snow or sleet

The two major events that most renter’s insurance policies do not cover are floods and earthquakes. If you live in an area that is prone to any of these happenings, you may want to purchase a separate flood or earthquake policy.

Should I choose a policy with a lower deductible?
Like all insurance policies, the deductible for your renter’s insurance is the amount of money you are responsible for paying in the event of disaster before your policy kicks in.

Many people automatically choose a policy with a lower deductible, but that is not always the smartest choice. A high-deductible policy will give you a lower monthly premium. The amount you save each month will likely offset the cost of the higher deductible if you need to file a claim.

Do I need a floater?
A floater, also known as a rider, will provide additional coverage for pricier items if they are lost or stolen. Most policies will include a cap for replacing a specific kind of lost or stolen items. This includes expensive jewelry, furs, collectibles, heirlooms, costly sports equipment and musical instruments. If you own one or several of these items, it may be worthwhile for you to add a floater to your policy.

Does my insurance offer any coverage outside damage to my possessions?
Your renter’s insurance policy will also offer you liability protection to cover you against lawsuits for bodily injury or property damage caused by you, your family members or your pets. This coverage will pay for legal counsel in a court of law and no-fault medical coverage for anyone who gets injured on your property.

What is ALE?
Additional living expenses (ALE) refers to any extra expenses you may have, such as hotel bills, food costs, etc., if your home is destroyed or otherwise unlivable because of a disaster that is covered in your policy. If you have ALE, you won’t need to worry about these extra costs while you wait for your home to be repaired.

A renter’s insurance policy will help you recover from a disaster until you can get back on your feet. With the affordable monthly premiums and generous coverage, it’s a wise investment in your financial future.

Your Turn:
Do you have a renter’s insurance policy? Tell us what you love about it in the comments.

SOURCES:
https://smartasset.com/mortgage/top-5-tips-for-buying-renters-insurance

https://www.iii.org/article/your-renters-insurance-guide

https://www.nerdwallet.com/blog/insurance/what-renters-insurance/

https://www.google.com/amp/s/www.zumper.com/blog/2017/09/heres-everything-you-need-to-look-for-in-a-renters-insurance-policy/amp/

Choosing the Best Renters Insurance Policy

by Advantage One, posted in Tips & Best Practices

What’s the best renters insurance policy for you?Portion of a renter's Insurance form , keys and a pen on a desk
Whether it’s a busted pipe that floods your apartment, smoke damage from a neighbor’s kitchen fire or a broken window caused by a windstorm, renter’s insurance can mitigate your risk of losing valuable possessions due to events outside your control.

Renters insurance is a smart and surprisingly affordable way to protect your belongings when the unexpected happens, but there’s no one-size-fits-all policy. To determine the policy that best fits your material life, consider the following tips.

Take time to comprehend the contract
Although a renters insurance policy might be a dull read, it’s important to sift through the entire policy and understand it completely before signing off.

“When you have a renters policy, an insurer typically pays for damage to your personal property, the cost of staying elsewhere if your place is inhabitable (say, from smoke damage), and accidents for which you might be legally liable—for example, if a visitor gets hurt or has property damaged at your place and sues,” explains ConsumerReports.org writer Barbara Kiviat. “Make sure any policy you buy covers all three.”

For greater liability protection, Nerdwallet.com writer Juan Castillo recommends investing in “umbrella insurance, which gives you an additional layer of liability coverage above the limits of renters insurance.”

Kiviat also recommends paying special attention to the “perils” covered in the policy. According to Kiviat, you’ll be covered by most policies if your belongings are impacted by vandalism, smoke, riots, explosions, fire, hail and theft, but damage incurred due to floods and earthquakes typically require additional, distinct insurance policies.

Let circumstances dictate choice
Although renters insurance is considered an overall affordable expense because of the protection it provides, your budget still might be less than accommodating. If your budget is rigid, Castillo recommends you “consider increasing your deductible. But first ask yourself: ‘How much can you pay out of pocket in the event of a damage claim?’”

Your dwelling would not be a home without your furry best friend, and although a dog is usually a source of unconditional love, sometimes your precious Fido can exhibit Cujo-like behavior.

“A lawsuit against you over a dog bite could ruin your finances for years. If you want coverage for this, make sure dog bites are covered by the liability portion of your renters insurance policy,” advises Castillo.

The philosophy of “what’s mine is yours” is an amiable way to live with a roommate, but it probably shouldn’t extend to insurance matters.

“Before you sign a policy, have a frank discussion with your roommate about how to share insurance payments—especially if your roommate has a lot of stuff that could drive up the cost of the quote. Be sure you agree, too, on the type of renters insurance coverage you’ll get,” advises Castillo.

Do the math
Since most items lose value over time, it’s important to understand the difference between cost and value.

“Policies cover either the replacement cost of property or its actual value. The latter takes into account that older items may have lost value over time. You might save on your premium by opting for actual-value coverage, but it’s usually well worth the price to go with a policy that covers replacement cost, because that’s what you’ll have to pay to buy new things,” explains Kiviat. She also notes that you can purchase additional coverage if you posses high-ticket items that your policy won’t provide full replacement cost for.

Renters insurance is a must-have budget item, and with solid research and a thorough assessment of your belongings and lifestyle needs, you will be able to buy the right renters insurance policy.

Used with Permission. Published by IMN Bank Adviser Includes copyrighted material of IMakeNews, Inc. and its suppliers.

Legal Forms Every College Student Should Fill Out

by Advantage One, posted in Tips & Best Practices

Health documents your child should complete before starting school

At times itcollegeforms_featured can seem like the road to college is paved with paperwork. In addition to the roommate questionnaires, room and board forms and other administrative paperwork, there are three other forms that should be taken care of before your child starts college, and they are probably not ones you’ve thought of before.

When your children go off to college, chances are they are or soon will be 18. When your children become legal adults, you and your spouse’s legal rights in matters that concern them become limited. If you aren’t prepared for that change, you could run into some unexpected legal complications.

Below are the three legal forms your college-ready child needs to fill out to ensure that you are prepared for any legal situation ahead:

1. HIPAA Release Form — HIPAA is the Health Insurance Portability and Accountability Act of 1996. It lays out the regulations that doctors, insurance companies and other healthcare providers must adhere to in order to protect a patient’s privacy. These regulations apply to all adults, so once your child becomes an adult, you are no longer entitled to special parent privileges, like overriding the child’s right to privacy before the age of 18.

“If your student ends up in the hospital, this document, a permission slip of sorts, will allow the doctors to share information with you,” stated Accredited Investment Fiduciary Charles C. Scott, president of Pelleton Capital Management Ltd. “And if your student is on your family health insurance plan, and you need to deal with your health insurance company about any medical claims for your student, this form is very important.”

2. Healthcare power of attorney — A healthcare power of attorney can also be known as a medical power of attorney or healthcare proxy.

“You will need it to make health-care decisions if your student ends up in a medical crisis or has some mental health issues that make him or her unable to communicate or understand their own wishes,” Scott said. “Some states will allow next of kin to make basic decisions, but if it’s a critical situation, such as removal of life support or advanced mental health issues, without this POA, you would have to get a court order to take care of things.”

If there is a medical situation serious enough for a HIPAA release form and a healthcare POA to be applicable, you will be glad that the paperwork has already been taken care of, enabling your child to get the care you know they want as efficiently as possible and with decreased stress.

3. Living will — A living will is a form that helps ensure your child’s medical wishes are carried out no matter what. Because students typically have few possessions of substantial net worth or other assets, a will is far from their mind; however, a living will is a different matter entirely. It deals with medical issues, such as whether or not life-extending medical treatments and resuscitative measures should be used.

“Don’t find out too late that your student has been admitted to a hospital and you’re not authorized to discuss treatment plans or make urgent decisions regarding care,” states Ray Martin, CBS MoneyWatch contributor. “A living will outlines the student’s wishes about life-extending medical treatment and addresses other intentions, such as organ donations.”

It is an exciting time for you and your child, so get these forms taken care of and out of the way now so you can get back to shopping for dorm supplies and celebrating the new chapter ahead.

Used with Permission. Published by IMN Bank Adviser Includes copyrighted material of IMakeNews, Inc. and its suppliers.

Do You Need Renters Insurance While in College?

by Advantage One, posted in Lifestyle, Tips & Best Practices

Protect your belongings with renters insurance

If you are currently attending college, RentersInsurance_Featuredit can be a good idea to look into purchasing renters insurance, which protects a person’s belongings in the unfortunate event of theft, fire, vandalism or water damage.

So, for instance, if your laptop is stolen, you’re covered. If a pipe bursts and damages your furniture, you’re covered. If a window breaks during a rowdy party, you’re covered.

It sounds pretty good, right? The thing is, it seems that most college students don’t think to purchase renters insurance, one reason being they think that they’re already covered on their parents’ insurance.

“The college students always assume that their parents have this coverage,” says Mercury Insurance Regional Marketing Director David Suarez. “But that coverage changes the minute they move away, even while they are at school. If they are living off campus, they no longer have that coverage. This is something that college students have never had to think about before.”

So the age-old question: Is it worth it to purchase renters insurance? Experts say yes — especially for the inexpensive cost. In fact, renters insurance goes for about only $15-$30 a month, according to the National Association of Insurance Commissioners.

“All college students living off campus should have renters insurance,” says Brainy Chick Finance blog founder Kelly Fisher. “Say a party gets out of hand and damage is done, you do not want to be paying for that out of pocket. If there is a leak or pipe issue and your items are ruined, renters insurance would cover your belongings.”

One of the biggest reasons experts preach for renters insurance is that damage is unpredictable. For example, unless you know your roommate extremely well, which most college students don’t when they first attend school, this person can be unpredictable.

“Roommates can be a huge unexpected security risk,” says SafeWise.com’s Community Outreach Director Clair Jones. “Many college students have no control over the person they share a room or apartment with. It’s definitely a good investment to take out a renters insurance policy that covers their laptop and any other items necessary for their schooling so that they aren’t stuck taking out an unnecessary loan to replace them.”

In addition, Suarez notes, it’s even more important to look into renters insurance if you or your child are living in an off-campus residence, which is more unlikely to offer any protection than on-campus residency.

Many college students will wave off renters insurance with the logic that their belongings aren’t expensive enough to justify protecting. However, Suarez says, this type of thinking is wrong.

“It’s really a matter of their ability to replace items,” he says. “The coverage pays to replace items. Start with clothing and add in electronics of different types. You can easily get up to a few thousand dollars in replacement costs. College students can buy renters insurance at very affordable rates to make sure that they can replace these items if they need to.”

Another factor in renters insurance is liability coverage, which college students can pay to include. Liability coverage protects students if someone is hurt while in their residence or if the student accidentally injures another person. This kind of insurance coverage varies among different policies, so be sure to read the details on whichever plan you choose.

If you or your child needs renters insurance, contact us or stop by today to see how we can help.

Used with Permission. Published by IMN Bank Adviser Includes copyrighted material of IMakeNews, Inc. and its suppliers.

How Car Insurance Varies by Location

by Advantage One, posted in Lifestyle, Tips & Best Practices

Where premiums are highest and lowest, and why

If you’ve lived in differentCarInsurance_Featured states or regions of the country throughout your life, you may have noticed something about your cost of living — the price you pay for your auto insurance varies drastically by location. These differences are not arbitrary, however; several factors go into determining insurance rates:

Legal environment – “Next time you’re in your car driving down the road, take a look at the billboards. Do you see a lot of ads for what are known as ‘ambulance chasers?’” queries Gigi Douban of Marketplace.org.

Robert Hoyt, a risk management and insurance professor at the University of Georgia, explains that rates are higher in areas where residents tend to sue each other often, thus creating an ideal environment for lawyers who specialize in cases seeking damages for personal injury. Insurance companies track litigation rates, how often juries award for damages and other factors when setting insurance rates in any given area.

State laws – Varying insurance regulations also contribute to the difference. Hoyt says that in his experience, states in which drivers have the highest auto insurance costs are the no-fault states, meaning the insurance company covers your injuries in those states.

Population density – People in urban areas tend to pay more for car insurance. “The more cars, the more accidents that happen,” explains Laura Adams, senior analyst with InsuranceQuotes.

Other sociopolitical factors – The level of competition among insurance providers is another factor that is taken into consideration; think of it as supply and demand.

Also, Forbes reports that rates are costlier in states that have a higher-than-average percentage of uninsured and underinsured motorists (largely because of economic reasons) who cause crashes for which they aren’t covered and can’t pay. One other way prices can vary by state is if you are in an area prone to storms and thus storm damage. Rates increase if there was severe weather the previous year that produced more claims than normal the year before that.

Put into practice
A 2015 report from InsuranceQuotes shows that drivers from North Carolina, Wisconsin and Maine pay the least for auto insurance. North Carolina’s rates run 41 percent less than the national average, while Michigan’s rates are more than double that average.

According to Insure.com, Falmouth, Maine, has been known to boast the lowest premiums in the country, a fact largely accredited to relatively low traffic density, active competition among carriers, low crime rates and the absence of recent natural disasters.

“Many of these problems are outside the control of drivers,” says Amy Danise, editorial director of Insure.com. “But even if you live in an expensive state, you can hold down your insurance costs by keeping your driving record as clean as possible and selecting a car that is cheap to insure.”

Whether it’s automotive or anything else, stop by today to see if we have any insurance products that can be of assistance to you.

Used with Permission. Published by IMN Bank Adviser Includes copyrighted material of IMakeNews, Inc. and its suppliers.