REal Talk Sept 16 2021 – Post Ida Lessons Learned Part 2
The effects of Tropical Storm Ida are still very raw for many of us… this week, we talk to our friends at Goosehead Insurance – David Robinson Agency, who tell us why we may not want to call our insurance carriers when we have a water emergency in our homes.
And register for our upcoming webinar on Sept 30 at 8pm with them where they explain what we mean by “What you don’t know about Homeowners’ Insurance can cost you” Register in advance for this webinar: https://us02web.zoom.us/
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Hey Bonnie, how you doing? Great.
But today we have Jaina and David, and we’re so grateful that you joined us for REal talk.
Yeah, so just a introduction and now there are four of us to talk over each other, so we apologize zoom land, but we just love Jayia and David and Goosehead insurance world that they’re in because they have been an incredible resource of information to us. We had no idea how little we knew about homeowners’ insurance until we met David and Jaina. And they are exceptional at explaining the ins and outs of things that we ought to know that can hurt us, that we don’t know. So we’re gonna let you guys go. We’re, we’re really here to talk about post-Ida stuff, particularly, and how we can prepare for any event moving forward.
All right. So we’ve been talking about this a lot, obviously. We’ve been on the phone a lot. We’ve been on social media a lot, just trying to like trying to prevent anything from getting worse than it is. So really the main, the main goal we’ve had post-Ida is she makes sure that people are taking the proper steps to get to where they need to go to help themselves the best. And and one of those one of the major myths we see being tossed around everywhere, which is why I was on social media, trying to stop everybody was I kept seeing the advice of call your carrier, call your carrier. You gotta call your insurance carrier. And as an insurance broker, I know that this is right now, kind of the opposite of what you want to do, right? Calling your insurance carrier is essentially just you calling up a major company that you pay money to that tracks your behavior in terms of how you treat your insurance and you’re disclosing potentially a giant loss to them.
And so right then and there, you’re already getting yourself into some potential trouble calling your carrier simply to find out if damage like a storm like Ida could create is even covered. Can really get you in some hot water in terms of your insurance credit. It’s, it’s, it’s seen as a loss and it makes the insurance company nervous. If you call and say, I have a foot of water in the basement, and I’m not so sure if my policy covers that. So not only are you causing trouble for yourself in terms of your insurance credit, but you are essentially unsure if you even have a claim to make, because you don’t know if you have that coverage. And that’s what we want to stop people from doing is don’t call your carrier, look at your policy. You need to look to see, do I have water backup, even on my policy?
Is this a water backup situation? So that’s the one thing we want to tell people to stop doing now in terms of a broker, which is what we are, we don’t work for the insurance companies. So if you do have those types of questions, if you did have some water damaging, not sure what to do about it. And if you’re covered, you can call us safely without having to worry that we are recording this all back to the carriers. So we can tell you what your deductible is. If it makes sense, we can tell you if you have that water back-up there and and you can data collect without, without having to reveal too much just yet
Jaina. Can I interrupt you real quick? I have a question. So if someone doesn’t use a broker, which I never knew previous to meeting you, that that was a thing. So if I have insurance and I don’t even know where my policy is, or I’ve somehow find it online and I pull it up and I don’t know what I’m looking at, what does a person like me supposed to do if I don’t have a relationship with you already? And I have a question about my insurance, because it seems like the obvious thing to do would be to call the people that you pay insurance to. Right? It seems obvious. It seems so backwards the way it works. So what should a person do if they’re in that conundrum?
Honestly you’re better off Googling what you’re reading on your insurance policy to find out what that is. I mean, isn’t that silly, that’s really a lack of support right there. There is no way to get out of that. I wish there was but there isn’t, if you can’t decipher what it is, you’d be better off going on Facebook and asking your friends, do any of, you know, what this means. So no way, that’s the thing. There’s just no way to escape that situation. You just can’t do it.
I think the first time we met you guys, you explained which I had never considered that the insurance companies are protecting their assets and their interests. And so a broker is a great idea because you’re protecting your client’s assets and interests. So it’s just a very simple distinction that I think most of us don’t understand, even if your insurance company is terrific in their, you know, the answer, as responsive as mine is they’re still going to be looking out for their risk management. Right. So anyway,
Yep, that’s right. We just, we like to remind people that they’re not, they’re not non-profit organizations. They want to make more than this bend, and that’s not to say that they’re not credible or good at what they do, but we misuse our insurance. We misunderstand what we’re supposed to be doing with it. And that’s kind of how we set ourselves up for that trap of increasing our own premiums.
So Jaina explain what you mean by that. Cause you did on another call we had this week, explained that really well. What is insurance meant to be for and what is it not?
It is for catastrophic events. It is for the big events. Like we just experienced storms burst pipes in our home, you know, sudden and accidental events is really what it’s for. And I feel like unfortunately, a lot of folks really think it’s a home maintenance plan and it’s not it’s, you know, the math doesn’t add up. Our premiums, aren’t really that high. Right? Most of us paying a thousand to $2,000 a year. If we were each making a $5,000 claim every year, all the insurance companies would go bankrupt. They wouldn’t be able to do it. So, but they don’t explain this to us. Right. They price it in such a way that we should be able to figure it out, but they don’t explain this to us. And so really it’s for those big big events, it’s, you know, for something that we’d like to tell people, not sending that it’s going to ruin your week or even your month, it’s something that’s going to ruin your year is really what insurance is for…homeowners’ insurance. The other insurance is that I think people confuse it with, it’s like a home warranty type of insurance. Right?
Right. So as we’re kind of adjusting to this new potentials, sadly new normal of catastrophic type rainfall, flooding, hurricanes, things like that, what should clients be looking for to have on their insurance policy? You mentioned like a water backup. Can you explain to people what exactly we want to add to our policies moving forward, even if we’re not in flood zones and maybe you can touch on that as well.
David, I’m going to let you do that.
Okay, great. So thanks so much for having us. The things that people want to be covered for is water damage in their basement. There’s two distinct types of coverage. One is called flooding, and that’s essentially water coming into the building from outside. And that’s never covered on a homeowners’ policy. And it’s a separate policy that the government has a flood insurance and there’s private carriers as well. You don’t have to be in people that people make the mistake of saying, I’m my house, isn’t in a flood zone. I can’t get flood insurance and I don’t need it. None of those things are true. Every house is in a flood zone. It just depends upon whether the risk is high enough for it to be required for a loan or not about 25% of the claims paid nationally are in those lower risk zones where it wasn’t required for the loan.
So the first thing I would recommend to folks is get a flood policy to cover damage to your home from water coming in from outside. The next type is what we were talking about backup coverage. So that’s not normally included on a homeowners’ policy. And what that means is water coming back in your sewer line or your drain in your basement, or your sump pump overflowing. So essentially water inside the building. So, so those are the two main coverages that folks should make sure they have, and that they make sure they have an adequate amount. One thing to be aware of most flood insurance does not cover anything in the basement except the furnace and the hot water heater. So, so additional coverage is available, but it’s gotta be added on it’s, it’s, it’s always separate and it’s not available on the government only on private flood insurance.
So they’re not going to cover replacing a floor or dry wall or carpet or anything like that generally ever.
Correct. Well within an NFIT national flood insurance program policy, which is the FEMA flood insurance, but coverage for that is available from private carriers. So folks with finished basements should look at private flood insurance.
And that again is the type of thing that it’s good to have a broker for it. And we’re here, we’re not here to be salesy or pitching goose head in any way, but just to distinguish it, like, I don’t want to be doing all that research. And I certainly wouldn’t even know what to be looking for, but that’s what you guys do day in and day out. Right. So it’s really valuable, valuable to have someone doing that research for you.
Yeah, our platform is helpful because we have over 40 different companies in New Jersey that we can compare coverage and cost with. So we’d kind of make the shopping process pretty easy not to try to
Because, because as brokers, we don’t work for our customers for the carriers. We work for our customers. We’re allowed to have this transparency. This transparency is necessary to create equity. And you know, in the insurance markets, people need to know what they’re doing, because if you don’t know, you’re pricing yourself out and you’re paying twice as much as everybody else is for the same coverages. And it’s really just because there wasn’t transparency when this was explained to you, that is crucial to us. That’s kind of our mission is to make sure that you all understand why wouldn’t you, it’s a contract. You are signing a contract with your insurance company.
Another topic kind of ties the two things together that we’ve been talking about multiple claims and water damage. Insurance companies look at water damage in it with a different light than other types of claims, because it seems to be the thing that they write the most checks on, or a large number of checks and multiple water claims on a policy can get someone canceled. So if you have a plumbing issue try not to let the insurance company know, just get it fixed. Cause multiple water claims will get a cancellation and certainly a price hike. So it’s treated much differently than a fire or, or a tree getting knocked down into into our roof. Even though those types of claims can tend to be higher dollar claims than the multiple water leaks from leaky pipes. But don’t let your insurance company know about those.
Yeah. We’ve had some clients experience this and what Susie and I realized is there is so much to know and learn about insurance. It’s t’s a whole another world. And we had before Ida previously planned to do an event with you and we will, we are going to do it on September 30th at eight o’clock. We are going to take a deeper dive with you guys into all of these issues when to call, when not call what coverage you need. Because I would say most of us really don’t know much about insurance other than we pay it and we need it in order to own a home. And that’s about all, that’s really all that.
Yep. And you just hope that when you have something to file a claim on that, they’re going to be there and you’re going to have the right coverage, but you really don’t think about it too much. So we will put your information in the description and so that they can reach that people can reach out to you. Cause I imagine, especially Jaina, some of the stuff that you said in the beginning, if someone has experienced flood issues or water issues, these past couple of weeks hearing that what they’ve done was wrong, it’s probably going to add to their stress, but there’s still certainly help that you guys can provide for the immediate as well as for the future. So we just want to say, you know, everyone take a deep breath. We know that for those of you who are still dealing with these issues, it’s very real and it’s very stressful. So we offer Jaina and David as a resource and we also offer our resources. We’ve talked to roofers and waterproofers and contractors who are all incredibly busy right now, as you can imagine because of the thousands of calls that they’re getting, but they do answer our calls and they do come running. When we tell them that one of our friends or clients need help. So please reach out to us and we are happy to put you in touch with whoever you need.
That’s great, Susie. And we’ll add that on top of what you said is that you do not have to make a decision today. If you want to make a claim, you have time. And I think a lot of people think that they have to just decide on this right away. You don’t photograph everything that’s going on, remediate your space, get the water out of it, get it dry. Talk to your contractors, get quotes. Then it’s time to decide, do I need to make a claim on this? Right? If it’s not, it may not be as expensive as you thought it was going to be. But when we see this, this destruction, we panic and we think we have to deal with it immediately. You can take that deep breath. You talked about, take some time to figure out how you want to proceed.
Speaker 4 (14:06):
And of course we’re happy to answer any questions that folks have. You know, please feel free to call either of us. We’re happy to talk.
Susie & Bonnie (14:14):
Thank you so much.
We really appreciate you guys. And we know that our clients have had amazing experience working with you. And we’re just so grateful to know you and to be in business with you and grateful for your expertise.
Thanks for trusting us. We appreciate it.
Yeah, definitely. All right. Have a good weekend everyone