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Home Owners Insurance

Discussion in 'Sidewinders Bar & Grille' started by 33db, Jul 31, 2019.

  1. davidKOS

    davidKOS still at it Strat-Talk Supporter

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    As long as I was not a professional, homeowners covered my instruments.

    BUT - and I do not know about now, as this was some years ago -

    The best insurance I got was through the AFM. Then it covered almost all working situations for gigging musicians at a very modest rate.

    "Maybe you could classify them as hobby equipment? "

    Talk to your agent, it may be that you need a rider, but if you do not gig, that should be OK. as I said, I am not sure about the current issues.
     
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  2. nadzab

    nadzab Peace & Love, my Brothers & Sisters... Strat-Talk Supporter

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    Well, I'm in claims, I have nothing to do with sales...

    About the Jem...the whole point of this thread is that musical instruments typically aren't covered by standard HO policies. When you pay for your HO insurance, you're buying insurance for your entire home...so I'm not sure saying that you would regret ever buying homeowners insurance just because it doesn't cover your guitar makes total sense...maybe it does, I dunno. But your statement about the actuarial process (the statistics involved in underwriting) is inaccurate - it little to do with the cost of replacing one single insured's property.

    And as far as saving the money instead of paying the premium...basically "self insuring": if a policy to cover your collection of music gear that's worth $10,000 costs $125 a year, you'd have to save up that premium for 80 years to be able to to replace your gear. I'd much rather pay the premium and have the peace of mind knowing that if I have a loss in year 2, 10 or 20, I've got the coverage - it's all about different peoples' risk tolerance, but that's where the gambling aspect comes in. Look at auto insurance - very expensive, because cars are expensive to repair, and liability claims claims for personal injury can reach astronomical levels - but you can bet that I'm going to carry collision insurance on my car, and (even if I lived in a state that didn't require it) liability insurance, because to downside of being uninsured can be disastrous.
     
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  3. fezz parka

    fezz parka Making a record.... Strat-Talk Supporter

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    Same here. :)
     
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  4. mistermikev

    mistermikev Strat-Talker

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    i (respectfully) beg to differ, my statement is accurate. policies are based on statistical data. you are insured against the statistical likelihood that the insurance company will have to pay out more than they take in. this is obviously averaged across multiple customers... but if you understand the math... you probably aren't a gambler. That said, no one wants to risk loosing their house... so you gamble. I suggest that you gamble as little as possible. There is a reason insurance companies posting record profits in a down market... and I don't hate them... just have more sense than that.

    afa self insuring... if I self insure for ten years and nothing happens to my jem: I just get to keep a grand. If I pay insurance and after a year my jem is destroyed... and the insurance company says "sorry we don't cover that for x"... then I've spent a grand and have nothing. It is only the scenario where I buy insurance, my jem gets destroyed before I have paid in enough insurance to make it a wash... and then the insurance covers it... but that is the exact scenario that the insurance company does statistical analysis to prevent/underwrite your coverage. So if they are doing their job, it is pretty unlikely. we haven't even considered the deductible.
    long story long: I still have insurance - but I don't fool myself of what it is.
     
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  5. Stratoskater

    Stratoskater Most Honored Senior Member

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    I pay $4 a month ($48 a year) extra on my Home Owners policy for a $20,000 personal articles floater that covers all my gear at home, in transit and at a gig. It would take the company 416 years to get enough premium out of me to fund a total loss claim so that completely disproves your statement of " if you saved the money for the insurance premium, 94.999% of the time you would end up having more money than you need to cover the entire expense", since I would need to save for over 416 years to have more than $20,000 at $48 a year. I got my buddy who gigs and owns a studio $125,000 of coverage (again at home, at studio, at gig, in transit) for $425 a year. In his case it would take him 294 years of premium to save up $125,000.

    Sure I am likely to never have a loss and the company will keep my premium but it goes into a risk pool to fund losses other will have just like their premiums help fund me having a total loss month one and the carrier only having collected $4.

    I have been in Commercial Insurance for over a decade, my father was the top Construction Risk Management producer in the SE from the late 70's till 2013 when he retired and was part of a three man team that drafted the forms and got carriers to enact the first ever policy for Contractors Professional Liability and my wife runs the personal lines insurance program for the second largest Credit Union in the US so I am very familiar with how insurance and carriers operate. Your comment that a carrier does analysis to prevent your coverage from paying is not correct. They do analysis and loss picks to set a premium to adequately fund potential losses. They then invest those premiums to create a further cushion for payouts. Now policies do have exclusions and the insured must read them and make sure what they are buying actually covers what they are wanting it to. And like everything else in life you pay for what you get so a lower premium will mean a higher deductible and likely more exclusions.

    My favorite story of insurance is in 1979 my grandfather purchased one of those $10,000 life insurance policies they advertised back then that had 10 cent premium for the first payment then it adjusted to the correct underwritten premium in the following months. He bought the policy on a Wednesday and died that Saturday. He paid 10 cents and my grandmother got $10,000.

    And @nadzab is correct in how premiums are figured. It is a rate per $100 or $1,000 of coverage so the value does play into it but the rate is not higher for higher amounts. The rates are determined by loss frequency and not the value of the property insured.
     
    Last edited: Aug 9, 2019
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  6. Stratoskater

    Stratoskater Most Honored Senior Member

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    This is a broad and rude statement to make about my and others on here industry. I'm sure if you tell me what you do for a living I can come up with some disparaging broad generalizations about that field of work too even without me having nay real world experience working in that industry. Sorry if that sounds too rude or harsh but I get pissed at people making general statements about insurance when the number one reason a claim is denied is for an exclusion of coverage that was right there in the policy forms but then that person decides to naysay the insurance industry as a whole because they did not read their policy and understand what coverage they did or did not have. This is why a good independent agent (note I said a good one) is worth their commission and then some.

    For those of you in the dark about how it works, insurance coverage is a contract period end. The insured pays a premium and agrees to abide by the terms and conditions of the policy such as preservation of property after a storm or other loss (their side of the contract) and the carrier agrees to pay claims up to the policy limits within the conditions of the policy (their side of the contract). It is up to the purchaser (with help of an agent if you use one) to read the contract and understand what they are buying. The carrier can only deny a claim if there is a clause or exclusion in the contract (policy) allowing them to. Otherwise they have to pay.

    Now there definitely are crooked and lazy agents out there (as there are crooked and lazy folks in every industry on the planet) who lead their clients astray but that is why we all have to carry errors and omissions liability insurance so and insured has recourse against an agent if they mislead them about coverage.
     
    Last edited: Aug 9, 2019
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  7. albala

    albala Most Honored Senior Member Strat-Talk Supporter

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    I have been an independent insurance broker for over 25 years. If it has the word 'insurance' in it, I can sell it.

    Even though I disagree with him, I don't blame @rocknrollrich for feeling this way. Most of my clients do too and they've never had a claim, but a handful of them are thankful each and every day for having had the right insurance in place when something bad happened and their insurance carrier kept their promise.

    These are the ones who've filed claims. I've had very few clients who's claims were denied when they should have been covered.
     
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  8. mistermikev

    mistermikev Strat-Talker

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    well when you put it that way... yes, the insurance industry is not about profit... they just want to ensure my losses are covered. (does it sound funny coming out of MY mouth?)
     
  9. Stratoskater

    Stratoskater Most Honored Senior Member

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    That was a typo. It has been corrected to read Fund potential losses. And yes of course the insurance industry is here to make a profit. So were the guys who first started the modern insurance we know today back in the Lloyds Tea Hose in London when they would write their name and amount of coverage they would provide under the shipping cargo manifest for a vessel (this is where we get the term underwriter from) and they were clearly hoping that the cargo would make it safe so they could keep the full premium and make a profit. I have been to Lloyds of London several times and got to see the old ledgers where a Mr. John Smith would underwrite 100 lbs. of tea being sent to Spain or a shipment of silver to India.
     
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  10. rocknrollrich

    rocknrollrich Senior Stratmaster

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    That was a very broad and generalized statement. I also apologized a few posts later.
    I don't mean to say that everyone involved in the insurance business is dishonest and out to "take advantage" of me.
    HOWEVER..... two points I'd like to make regarding insurance.
    1). Insurance companies are in business to make money, not to better people's lives through insurance products.
    2). Health insurance, especially in America, is broken, and full of a lot of bad actors (to use an insurance term).
    I don't have the answers for the health insurance crisis (and that's what it is, a crisis), but i do know there are some particularly evil practices in this industry. I can give examples, but some are personal, some are political, and some are too involved to type out over an internet forum.

    Not everyone in the insurance industry is bad. I know that. I apologized for implying that.
    But you must realize that you work in an industry that lends itself to criticism, much of it is deserved.

    Dont get me started on the banking industry.
    And telemarketers..... they are all indeed bad people. Every last one of them.
     
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  11. mistermikev

    mistermikev Strat-Talker

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    oh... so they DO want to make money. whew, thank for clearing that up.
     
  12. rocknrollrich

    rocknrollrich Senior Stratmaster

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    Also I'd like to add that the problem with insurance is, you (the customer) don't know what you don't know.

    "My policy doesn't cover that?"
    An act of God? Suddenly my insurance company believes in God, and it doesn't cover what God does to your house.

    Let me pose a question.
    Joe lunchbox buys life insurance.
    One year later, he's involved in a fatal crash, which turns out to be his fault.
    Does the insurance company have to pay? Joe lunchbox was clocked doing 110mph when he crashed.

    Same scenario five years into the policy, does the insurance company pay? And why is Joe's protection bullet proof at that point in the policy, but not 6 months after he bought it?
     
  13. Stratoskater

    Stratoskater Most Honored Senior Member

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    Yes insurance companies are in it to make money but so is Fender. Does this mean Fender is not making guitars to better people’s lives by providing instruments? I don’t believe that just because a company seeks profits that they are not out to help people too. In the guitar industry there are plenty of companies that rip of designs (Joyo for instance) but plenty of folks on here buy there stuff and people say wow awesome pedal.

    The health insurance industry is a different animal than P&C and much of thier current issues are due to the ACA. I do agree with you that there are bad apples in every industry though. Also before coming to insurance 10 years ago I was in banking and finance for 13 years and worked for several reputable and socially and community minded companies so again stating the whole industry is bad is a crass generalization.

    I must again ask what field do you work in that is perfectly upstanding and cares not for profit.

    I have said that 2 times already. Can you name any business that is not out to make a profit? I have worked for three credit unions which are non profit organizations. The largest I worked for has over $23 billion in assets. Sure they zero out the profit on the year end balance sheet but not by giving the money back to its members. One year they had about $1.3 million to get rid of at year end. Know what they did, they bought giant 15x15 mirrors for the entrance to each branch that had writing that said “our members look good”. They have 1,000,000 members and could have given each back just over $1 but instead they spent $1,000,000 on mirrors.

    Acts of god are covered for the vast majority of the acts. This is the main purpose of property insurance. They cover fire, wind, lighting and many other perils depending on the policy form you purchase. Some have exclusion for weight of ice and snow or wind at the coast but this is due to those perils not being able to have proper rates developed using actuarial data.

    I have never heard of a life insurance policy with a speeding or at fault accident exclusion so yes they would pay the claim. Now many do have a suicide clause to nullify coverage but many waive that for minors these days.

    Your comments implying that acts of god and speeding cause coverage to be denied shows how little you understand about insurance and why you should be using a knowledgeable and reputable agent to help advise you.

    What you guys need to understand is the basic premise of any insurance is risk of loss. There are two types of losses, pure loss and speculative.

    Risk refers to the chance of a loss occurring. The two types of risk are pure risk and speculative risk. Where pure risk is involved, there is no chance of a gain. The only two possibilities are that nothing happens, or a loss occurs. Examples of pure risk are the risk of unanticipated death, illness, or disability.

    Speculative risk, on the other hand, comes with the possibility of a gain as well as a loss. For example, an individual may speculate on the stock market. In this scenario, it is possible for the invested funds to increase in value. Of course, it is also possible for them to decrease in value. So speculative risk includes a possibility of gain in addition to a possibility of loss. Speculative risk is not insurable. Some pure risk is insurable, though not all.

    Here is tne full article that may help many of you understand what insurance is designed for and how it works.
    http://www.crockerlife.com/education/risk-and-loss-in-insurance/

    What you guys also need to understand is that the vast majority of carriers have shareholders who they must give a ROI to or risk losing their investment. The root issues in many financial companies being profit hungry is the stockholders so I guess we should get rid of all publicly traded companies and shut down the NYSE so companies won’t chase profit so much. Oh wait then we can’t invest our 401K or IRA and retirement would be a dream very few would ever achieve. Wonder how Fender would be behaving if their IPO had happened several years ago? Would we be boycotting thier guitars and bashing them as profit hungry jerks? Oh wait I just remembered that one of Leo’s main reason for creating a bolt on guitar was the assembly line production he could use and it was cheaper, guess Leo was a greedy profit whore too.

    Bottom line is we live in a very capitalistic world and the greed ship sailed many many years ago. No amount of ranting about it will change that and every business on this planet is thier to make money, even that 5 year old with their lemonade stand. There will always be unscrupulous people in this world and they will seek to take advantage wherever they can.
     
    Last edited: Aug 9, 2019
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  14. Bcorig

    Bcorig Strat-O-Master Strat-Talk Supporter

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    I took out a “Personal Items” Policy for r $300/yr State Farm. Covers my Studio
     
  15. rocknrollrich

    rocknrollrich Senior Stratmaster

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    Please tell me you weren't ever a telemarketer. Can i at least hate that industry?
     
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