Vic Alemania looks at 5 aspects of home businesses where losses may not be covered by your homeowner’s insurance. If you do anything for compensation from home, please contact your insurance agent before a loss, so you know what would be covered and what might not.
By Lorie Ham
Another fall is upon us, which for some, means sending our kids off to college. If they are living away from home, it can bring a lot of changes to your life—an emptier house, less food to cook, and perhaps some extra quiet time. It can also bring other changes that need to be considered—such as, does your insurance need to change?
Mennonite Insurance agent Michelle Heinrichs faced those same questions recently. The first thing they did was review their contents and liability coverage under their renter’s policy to make sure that the policy coverage would extend to their son while in the dorms.
”We confirmed that while he considers our home his primary home—comes home at Christmas and Summer vacations—he can be considered an insured under the policy until he is 25. When he moves into an apartment at the beginning of the next school year, most companies would consider him on his own and this will not allow him to fall under our policy. So, we plan to get him his own contents policy then.”
So what if your student is living in an apartment already? Mennonite Aid Plan offers a Renter’s policy if the student lives in a home. If a student needs coverage for living in an apartment, they can offer them coverage through their agency side. “Just note that coverage is for the named insured and not the roommate,” continues Michelle. “A common misunderstanding is that the policy coverage extends to all residents of the home/apartment. These policies are not able to be written that way. Each roommate would need their own coverage for their own risk exposures.”
Another insurance question may come up if the student has their own car. Michelle’s son does have his own car, and he took it with him to school. What they did in this instance was to update their auto policy to show the new “garaging address.” According to Michelle, all vehicles should have an accurate garaging location. “There are possibly different risks depending on locations.”
However, many kids do not take a car to college with them. In trying to save on their premium, their parents might choose to remove them from the policy while they are away at college. “If there is ANY chance a student might drive a friend’s car, the exposure is still there, and it is best to not exclude them from the policy,” shares Michelle. “If an accident occurs while the student is driving, it could be catastrophic if no coverage is in place on their behalf. If you are wondering, review this with your own insurance agency.”
So make sure that you do your homework so your college student has all of the coverage they need. If you have questions about any of these situations, feel free to reach out to Mennonite Insurance Services and they will be happy to help. Mennonite Insurance offers coverage for all of these needs. Be sure to visit their website, and give them a call with any questions at (559) 638-2327.
Vic Alemania explains why your Homeowner’s Insurance contains a Workers Compensation section and who it covers.
By Lorie Ham
The cost of everything seems to have gone up during the pandemic. According to an NBC News Consumer article in March of 2021, Price Index data for the month of January found that the cost of food eaten at home rose 3.7 percent from a year ago — more than double the 1.4 percent year-over-year increase in the prices of all goods included in the Consumer Price Index.
Everywhere you go now you see higher prices—whether it be at the fast food drive through, picking up groceries and other supplies, or getting take-out from your local restaurant. A shortage in workers, a shortage in products due to temporary shutdowns of businesses, and a higher demand for some products due to a change in lifestyle caused by the pandemic, are just some of the many reasons for the spike in costs.
Another area that has seen a significant price hike is in building or repairing a home. The cost of lumber alone has gone up significantly. According to the Trading Economics website, since last spring lumber prices have risen more than 180% as the stay-at-home lifestyle has encouraged homeowners to expand or remodel their existing dwellings, and low mortgage rates exacerbated the home-building spree. The sustained rush of lumber buying caught sawmills and wholesalers by surprise at a time when Covid-19 restrained production, pushing prices up to record levels.
According to an article on the e2Value website, the pandemic has brought about an increased demand for home improvements/remodeling and a focus on outdoor areas of the home. Because people have been traveling less, they are spending less so they have more money to do these improvements. They also have more time to do the work themselves rather than bring contractors into their homes.
The National Association of Home Builders (NAHB) produces a quarterly Remodeling Market Index to assess remodeling activity among its members. The 2020 Q4 results showed significant increases over the 2020 Q1 results.
Chuck Bohn, one of the owners of Reedley Lumber, has seen this all first hand. “The building material that by far has increased the most has been lumber. The price of lumber overall has tripled in about 14 months. Lumber prices are based on supply and demand and the pandemic hurt the supply side in several ways, mill shutdowns, trucking shortages, etc. The demand increased, more homes being built because of low inventories of existing homes, [and] do it yourself home and yard projects increased greatly.”
Other building supplies have gone up in price as well. “If you leave lumber out of the equation I would estimate a 15-20% increase on hardware and other building materials,” continues Bohn. “Steel products have gone up considerably but maybe not all pandemic related. We saw a lot of steel price increases due to trade issues before the pandemic started.”
Unfortunately, the rising costs aren’t a trend that will be changing any time soon, even though more things are opening up. To be prepared for the high costs of repairing your home due to an emergency, make sure you have the insurance coverage that you need. Give Mennonite Insurance a call and we will be glad to help 559-638-2327. Or find out more information about what types of insurance you may need.
Vic Alemania of Mennonite Aid Plan explains how coinsurance affects the settlement amount on a loss. Vic also notes that coinsurance for property policies is completely different from coinsurance in health insurance policies.
To obtain the full policy benefits, your policy coverage limits must be at least the percentage (typically 80%, 90% or 100%) of the full replacement cost required by the coinsurance clause of your policy. The example in the video below is the easiest way to understand coinsurance.
By Lorie Ham
On top of everything else going on in 2020, California has been besieged by wildfires, and this fire season has shattered records. Mennonite Disaster Service (MDS) has been helping people affected by fires and other disasters for many years.
Founded 70 years ago, MDS is a volunteer network of Mennonite, Amish, Brethren in Christ, and other Anabaptist churches dedicated to responding to natural and man-made disasters in Canada and the United States. “Our aim is to assist the most vulnerable community members, individuals, and families who would not otherwise have the means to recover,” states Steve Wiest, Regional Operations Coordinator for Region 4.
When asked about the recent Creek Fire, Steve states even before it was fully contained MDS volunteers were working to find a way to help. “When a disaster is close to where MDS volunteers live the response is natural and appropriate because of personal connections. When we don’t live near by we usually wait for the local officials to invite us in.”
One thing that Steve feels MDS does well is rebuilding complete new homes after a disaster. “Many MDS volunteers come from the building trades and farming and those folks come with good skills. Whatever skills a volunteer will bring, there will be a place for them to make a meaningful contribution to the project. If the disaster survivor owns the property and if there is money for materials, subs and permits, then MDS will provide free labor to build the house. If they have insurance, they usually don’t need our help.”
A home that MDS rebuilt in Lake Isabella east of Bakersfield came with some added excitement. “As we worked on the second house we watched airplanes diving from the sky to drop fire retardant in the direction of the first home we had just finished. A fire was threatening the new house and had started less than a half mile from the house we had just finished. The next day I asked the homeowner if he had fire insurance and he did not. He said he could not find any. I called Jerry Linscheid and Jerry pointed me in the right direction to help get insurance. I was able to tell the homeowner that the new house was built with the latest California building codes and was much more fire resistant than the old house.”
The goal of MDS is to build homes that will withstand the next disaster, when possible.
The current building code has a section called WUI, Interface.” This is to make the house resistant to wildfire, but the main goal is to give occupants time to get out of the house,” continues Steve. “To make a house be able to survive a fire is a very tall order. The exterior construction is aiming to survive a 20 minute exposure to fire. To increase that to one hour could raise the cost of a 1,000 square foot house by nearly $100,000. The methods and materials of construction is only part of the plan. Keeping flammable material away from the house is just as important. Trees, shrubs, and landscape that allows fire to jump from fire source to fire source invites disaster. We have even seen that the patio furniture can be an ignition point.”
Equally important to MDS as getting people back into their homes, is the emotional and spiritual wellbeing of the disaster victims. Steve says that their volunteers are encouraged to put down their tools and visit with the homeowners, encouraging them to tell their story as they just listen. “The homeowners that we are building for are invited to have dinner with the group and tell their story. By telling their story, it helps them to heal. When they tell their story over and over again, we can see the healing take place.”
MDS is also involved in helping to prevent fires. In one instance, volunteers went to Camp Keola at Huntington Lake to remove dead trees and fuel from the forest floor. The camp is owned by the MC-USA Mennonite Conference and serves many children with disabilities. “Dozens of MDS volunteers spent a week in the fall of 2018 and the spring of 2019,” shares Steve. “The camp survived the fire because the fire fighters made a decision to protect that section of the fire line and that was possible because of the new water system the camp had installed. It is possible that the lower fire risk of having the reduced fuel on the camp grounds helped save the camp.”
To learn more about MDS and see how you might be able to help them with their work, check out their website. If you would like to learn more about fire insurance, please give us a call 559-638-2327.