Military Officer - May 2007 - (Page 42)

financialforum Just in Case Protecting your assets is a wise investment. Phil Dyer, CFP, has four suggestions that will ensure you get the most out of your property and casualty insurance. L Same Company, Different Price? ■ Insurance rates for the same company can vary by geographical location and the individual company’s claims history in that area. So don’t assume your current company has the lowest rate in one area of the country just because it does in another area. et’s be honest: A discussion about property and casualty (P&C) insurance — which encompasses auto, home, watercraft, aircraft, renter’s, and excess liability insurance — won’t be the highlight of any cocktail parties. Nonetheless, keeping this critical insurance updated is important to insure against an unexpected loss. Here are some important tips to follow. Review your coverage regularly. You should review your P&C coverage at least every three years and anytime you move to a new geographical location. Don’t just assume that your current agent/company is giving you the best deal because they say so — keep them honest and “shop” the coverage. Let your current insurance provider know you are reviewing your coverage and getting competitive bids from other companies. If you have been a good customer, this often can result in an additional discount. Choose the right deductibles. It costs an insurance company several hundred dollars in paperwork and personnel time just to initiate a small claim. As a result, those customers who choose a low deductible, such as $100 or $250, generally pay more in premiums to “protect” the insurance company. You are better off choosing a higher deductible, such as a minimum of $500 on auto coverage and $1,000 on homeowner’s coverage, and self-insuring small losses. You want the coverage in place for a catastrophic loss, such as totaling your car or losing your house to a ﬁre, not nickel-and-dime claims. Choose adequate coverage levels. The minimum coverage level required by most states might not be sufﬁcient, particularly for automobile coverage. Many basic auto policies provide property damage coverage of only $25,000, which might not be enough to cover many of today’s more expensive cars (especially if multiple vehicles are involved). If you live in an area that has experienced rapid home appreciation, double-check with your agent to ensure your homeowner’s policy covers you in the case of a total loss. Check out umbrella or excess liability coverage. Many P&C experts recommend lia- bility coverage — which protects your assets if you are sued and found negligent or liable for an accident — equal to two times your net worth. It is usually very expensive to increase the limits on auto and homeowner’s insurance individually, but an umbrella liability policy provides an inexpensive mechanism to increase liability coverage as your net worth increases. Most insurance companies require you to carry both auto and homeowner’s policies with them before they will issue an umbrella policy. With tax season out of the way, now is an excellent time to review your P&C coverage. When you do, use these tips. MO — Former Army Capt. Phil Dyer, CFP®, is deputy director, Beneﬁts Information and Financial Education. To ﬁnd a ﬁnancial planner near you, contact Garrett Planning Network at (866) MOAA-GPN (662-2476) or www.moaa .org/garrett, or visit www.moaa.org/ﬁnancial center for other resources. PHOTO: SEAN SHANAHAN 42 MILITARY OFFICER M AY 2 0 0 7 http://www.moaa.org/garrett http://www.moaa.org/garrett http://www.moaa.org/financialcenter http://www.moaa.org/financialcenter

Table of Contents Feed for the Digital Edition of Military Officer - May 2007

Military Officer - May 2007 Contents From the Editor From the President Your Views MOAA Directory Rapid Fire Washington Scene Financial Forum Ask the Doctor Chapter Activities Cover Story: Back Home Capt. David Porter, Pirate Hunter Where Valor Rests Emblems of Courage MOAA Member Services Pages of History Information Exchange Advertising Index Member Books MOAA Calendar MOAA Scholarship Donors Sounding Taps Encore

Military Officer - May 2007

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