What is the difference between an insurance broker and an insurance agent?

Insurance brokers are independent. They work for their clients, the insured, as opposed to insurance companies that employ agents to represent them.

 

Does Independent Insurance Agents of California provide free policy evaluations?

Yes.

 

Will OTC Insurance Services suggest reasonable insurance limits for liability insurance?

No. The decision on how much liability insurance to carry is a decision for every owner to make. The amount of a liability claim by a plaintiff cannot be predicted and therefore damages claimed cannot be predicted. All owners must determine how much risk they are willing and able to assume and then obtain the amount of liability insurance they believe is prudent. No professional insurance agent or broker will attempt to make this decision for their clients.

 

Is it possible to join your company as a part-time insurance agent?

Yes, provided that your long-term goal is to become a full-time agent and you are willing to partner with one of our full-time agents so that your clients can always reach you or your partner.

 

If we hire a nanny to watch our child, is it necessary for us to obtain any form of insurance?

Absolutely. A nanny is an employee so you will need to put him or her on payroll, pay all required payroll taxes and obtain workers' compensation insurance. You should also seriously consider employment practices liability insurance (EPLI).

 

Why do some insurance brokers that sell HOA master policies refuse to sell condominium owners individual insurance policies on their homes?

We believe they prefer not to sell these policies because the commission on an Individual condominium policy is very small. Some say there is a conflict In doing so, but we completely disagree and are pleased to write these small policies

 

When you review an insurance policy, what are the primary things you are evaluating?

The primary items are: (1) Does the policy provide comprehensive coverage? (2) Is the amount of coverage reasonably adequate? (3). Are unnecessary coverages included? (4) The reputation of the insurance company for paying claims, and (5) The cost of the policy.

 

What happens if after you evaluate a policy, you find that all is in good order?

We will advise you of that fact and suggest another evaluation in the future since circumstances, including prices for insurance, is constantly changing.

 

I am a newly retired business executive looking for a second career. Does becoming an independent insurance broker make sense and is it practical?

Absolutely. We can refer you to a company that will assist you in getting licensed. From there, we can help you with our in-house training program. Experience as a retired business executive will help you immensely.

 

Why do I pay a brokerage fee?

In the insurance industry, a brokerage fee or broker fee is what insurance brokers charge clients in exchange for finding an insurance policy at the best price with the greatest benefits.

 

What is the significance of the Agent of Record?

The agent of record is the person or company that has the legal authority to represent the insured in maintaining, serving, and/or purchasing an insurance policy.

 

What obligations does an insured have when making a claim?

An insured must: (1) Submit the claim timely, (2) Provide all information reasonably requested, (3) Provide a statement under oath concerning the claim, and (4) Reasonably cooperate with the insurance company.

 

What is an insurance binder?

An insurance binder is a contract that provides an insured proof that he or she has insurance. Binders are intended to be temporary documents issued while the full policy is being prepared and delivered. Binders state the terms of the insurance policy, the types of risks covered, any time limits, and other essential terms. Binders are issued by insurance companies and authorized agents. As soon as the policy is issued, the terms of the policy prevail over the terms of the binder.

 

We own a small property management company that manages condominium associations, apartments, and rental homes. We are excellent property managers, but we are not insurance experts. Are you available to be a part-time insurance administrator?

Yes. We are available to be your part-time in-house insurance administrator. As your insurance administrator, we review all insurance policies covering the properties you manage and all insurance policies covering the contractors that perform work on the properties you manage. We then provide recommendations for saving premium dollars and improving coverage. Your clients will appreciate what we do.

 

Our law firm represented a plaintiff in a case that went to trial. The jury gave our client an award of well over one million dollars, which was paid. The client took the position that the judgment should have been far greater and sued our firm for malpractice because we could not convince the jury that the damages were greater than one million dollars. Fortunately, we had professional liability insurance, but not enough. Does this happen often?

Yes. Unfortunately, in California, this is a common situation. It appears that juries in general are hostile toward attorneys and law firms. The best protection is to make certain you have enough coverage to protect all of your assets.

 

Does my homeowner insurance policy cover me for the risk of flooding?

Almost never. Flood insurance policies are stand alone insurance policies that provide comprehensive coverage for losses caused by flooding including runoff of surface water from rain, broken irrigation lines, and other sources. According to the Federal Emergency Management Agency (FEMA), flooding is the nation's number one natural disaster. It accounts for 25% of all flood claims in low-risk areas. In high-risk areas, the probability is 25 % that a home will experience flooding during a 30-year period. Even one inch of water can cost a homeowner thousands of dollars.

 

Is water damage covered by most homeowner insurance policies?

While not all homeowner insurance policies are the same, most cover sudden, accidental water damage. For example, most policies cover damage caused by storms, burst pipes, and drain line backups, but do not cover damage caused by failure to maintain. See: Flood Risks and Insurance.

 

What is Water Damage Legal Liability Insurance and how does it work?

Water damage legal liability insurance is a critically important coverage for owners of both residential and commercial condominiums, especially if the units are multi-level or stacked units. See: Water Damage Legal Liability Insurance

 

What is a Difference in Conditions Insurance Policy?

A difference in conditions (DIC) insurance policy is a type of policy that provides expanded coverage for defined perils not covered in standard insurance policies. They are most commonly purchased by people facing the possibility of a catastrophic loss. DIC policies are also designed to increase coverage for perils that can result in severe losses from floods , earthquakes, fires, and other catastrophes. DIC policies are often purchased by people forced to buy home insurance under the California Fair Plan.

 

Why did the cost of insurance on homes increase so dramatically after 2020?

The cost of insurance on homes is tied to the rate of inflation. As the price of lumber and other building supplies increase in price, the cost of home insurance follows. Inflation increased dramatically starting in January of 2020 and has continued to be very high due to high federal spending.

 

What is Forced-Placed Insurance?

Forced-Placed Insurance, also known as lender-placed insurance and creditor-placed insurance is an insurance policy placed by a lender in the event that a property owner's insurance has been cancelled or has lapsed. The purpose of the insurance is to protect the interest of the lender should their collateral be damaged or destroyed. The cost of forced-placed insurance is always passed on to the property owner.

 

How are insurance companies rated for safety?

Insurance companies are rated by several rating companies. Factors they consider include: (1) The amount of cash reserves, (2) The diversity of their income, (3) Their debt ratio, and (4) The types of risks assumed. See: Insurance Company Ratings.

 

What is subrogation and how does it work?

Subrogation is the right to sue a third party to recover money paid by an insurance company on a claim. The right may be exercised when an insurance company pays a claim and then sues the person that caused the loss. The process is usually reserved for significant dollar claims.

 

What is a claims-made policy?

A claims-made policy is an insurance policy that provides coverage when a claim is made against it regardless of when the claim event took place. However, the policy covers claims made only while the policy is in force or active. Another type of policy is an occurrence insurance policy.

 

What is an occurrence insurance policy?

An occurrence insurance policy is a policy that covers claims made for injuries or damages sustained during the life of the insurance policy. Under an occurrence insurance policy, the insured can make a claim for damages that occurred during the time the policy was in force, even if time has elapsed and the policy is no longer in force. Liability policies generally are either occurrence policies or claims made policies.

 

What is the difference between an occurrence limit and an aggregate limit?

An occurrence limit is the maximum an insurance company will cover per claim. The aggregate limit is the total claim costs an insurance company will pay during a policy period which is usually one year.

 

What is prior acts insurance coverage?

Prior acts coverage offers protection from events that occurred before an existing policy is purchased, up to a particular retroactive date.

Prior acts coverage protects the insured from incidents that happened before the policy was purchased, as long as continuous coverage is maintained. It is typically included in claims-made liability policies, such as errors and omissions insurance (also called E&O or professional liability insurance).

Prior acts coverage offers protection that starts at a specific retroactive date, typically the date from which you have maintained uninterrupted insurance. With any claims made policy, it's important to maintain continuous coverage, Full prior acts coverage does not have a retroactive date. That means the insured will have complete protection for a previous incident no matter when it took place.

Most insurers are not likely to offer full prior acts coverage to businesses that have never had claims-made liability insurance policies. The reasoning is that the business might already be aware of a risk, prompting it to file a claim under the new policy.

 

What is insurance tail coverage?

While prior acts are events that took place before a policy is purchased, tail coverage is the opposite: it protects the insured once a policy has expired.

Tail coverage, also known as an extended reporting period coverage, is an addition to a policy that extends the amount of time the insured has to report a claim after a policy has been canceled. In short, if an incident occurred during the time the insured had the policy, but a claim wasn't filed until after the policy had expired, the insured would still be protected for a certain period of time. Most claims-made policies will offer tail coverage as an addition to the policy.

Tail coverage is an endorsement (or an addition) to your insurance that allows the insured to file a claim against the policy after it expired or was canceled. It applies to claims-made insurance policies and typically involves paying the insurer an additional premium.

 

What is strict liability?

Strict liability is a legal standard that places absolute liability on a party for damages, regardless of fault. For example, in California, if an owner's dog attacks someone, the owner is strictly liable even if they were not negligent.

 

Can punitive damages be covered by insurance in California?

Not at this time. Punitive damage coverage is determined by each state's legislature and is subject to change. Punitive damages are awarded for intentional bad conduct or extreme reckless behavior.

 

What are punitive damages and why and when are they awarded?

Punitive damages are money damages awarded by a judge or jury to punish bad actors engaging in reckless, willful, malicious or wanton conduct, and to deter similar wrongful conduct in the future. Punitive damages differ from compensatory damages, which are intended to compensate a victim or claimant for injuries or harm sustained. Generally, punitive damage awards require a compensatory damage award.

There are two types of punitive damages: direct and vicarious. Direct punitive damages are assessed for a defendant's wrongful acts. Vicarious punitive damages are imposed against a defendant if he, she, or it is liable for acts of another. For example, an employer is said to be vicariously liable for the acts or omissions of an employee when the employee engages in wrongful conduct while within the scope of employment.

 

What is a consequential loss?

In the insurance industry, a consequential loss is an indirect or secondary loss caused by damage to or the destruction of business owned property. Typically, a consequential loss will be lost business income. A consequential loss insurance policy or clause can compensate the owner of the damaged or destroyed property for lost income. This type of policy is called a business interruption policy or business income policy. Consequential losses are not the same as consequential damages as defined in the legal profession.

 

What is the significance of the term: Coordination of Benefits?

Coordination of benefits refers to the policy provisions that determine the primary insurer and the secondary insurer when an insured has two more policies covering the same risks. It prevents insurance companies from overpaying on claims. Coordination of benefits is commonly used when there is water damage in a condominium unit.

 

What is an assumed liability?

An assumed liability is contractual liability. It exists when one party to a contract accepts a liability as part of an agreement. Insurance policies are available to protect against most assumed or contractual liabilities.

 

What is Additional Living Expense Insurance?

Additional living expense (ALE) insurance is included in most, but not all homeowner and renter's policies. ALE covers additional costs of living incurred by a policy holder if they are temporarily displaced from their residence due to a fire or other named peril. Covered expenses usually include, hotel costs, a food allowance, moving costs, storage costs, laundry costs, and pet boarding. Since not all policies are the same, it is important that an insured review any policy under consideration and discuss the coverages with an independent insurance broker.

 

What is Loss Assessment Coverage and why is it important?

Loss Assessment Coverage is very important Loss Assessment Coverage is designed to protect the owners of condominiums against special assessments resulting from liability claims or covered losses when the claim or loss is specifically insured against in the policy. It is coverage obtained by individual owners. See: Loss Assessment Coverage for Condominium Owners.

 

What is an Insurance Endorsement-Rider?

An insurance endorsement is a change in a policy that adds to or deletes a provision in the policy. Endorsements change the amount of the premium. The provision added is called a rider. The endorsement is attached to the original insurance policy.

 

What is a home insurance inspection?

A home insurance inspection is not the same as a home inspection which is generally made by a private inspector in connection with the sale of a home. A home insurance inspection is made by an insurance company representative often before they commit to insure a home, particularly if at is located in an area that's high risk for fires, earthquakes or other natural disasters. These inspections help the insurer determine the replacement cost of the property and it's contents so they can determine whether or not to insure and how much premium to charge.

 

How can I save money on our HOA master insurance policy?

Do not automatically stay with one insurance company and don't automatically renew your policy. What was a good rate last year might not be a good rate now. The market is competitive. What is important is that it takes about three months to shop for a policy so boards should not wait too long to get started. Also, remember that only an independent insurance broker-agent will shop for you. Captive agents for Farmers, Allstate, or State Farm represent only their company and will not be able to shop for you.

 

Is it possible to finance a large insurance premium?

Yes. Contact us if you would like to finance a policy. There are many premium finance companies in California. See: Insurance Premium Financing for a list of companies that operate in California.

 

Do the CC&Rs of a condominium association determine the type of insurance the association is required to purchase?

Almost always. Insurance brokers that provide HOA insurance should always have someone on staff that is an expert on insurance for all types of common interest developments.

 

How can a homeowner association board determine if it's properly insured and protected?

The board should ask its broker-agent the following questions: (1) Has the policy been updated to reflect current construction costs? (2) When was the last time the insurance broker shopped rates? If the HOA is using a captive agent, he or she will not shop rates, (3) Does the HOA have workers' compensation insurance to protect the association and its members from uninsured contractors? (4) Is the HOA covered by an Umbrella Liability Policy to cover gaps in coverage?, (5) Has the broker-agent informed the homeowners that their personal property is not covered by the master policy?, (6) Have the homeowners been informed about the need for loss assessment coverage?, and (7) Did the broker-agent determine whether the existing insurance policy meets the requirements of the association's CC&Rs?

 

What is non-owned auto insurance and when does it apply?

Non-owned auto insurance coverage provides liability protection if a vehicle you haven't leased, hired, or rented is driven for your business or homeowner association and is involved in a vehicle accident. This could apply to an employee or a homeowner association board member or committee member.

 

Do HOA boards have a fiduciary duty to purchase earthquake insurance?

Most attorneys are of the option that HOA boards do not have such a fiduciary duty but each board should check with their own legal counsel to obtain his or her opinion. See: Earthquake Insurance for Homeowner Associations and Voting for Insurance. Condominium unit owners should also read: Earthquake Insurance for Owners.

 

What is the California Earthquake Authority (CEA)?

The California Earthquake Authority is a nonprofit, privately funded, publicly managed organization that sells earthquake insurance in California through participating insurance companies working through insurance brokers and agents. Call for a no obligation quote and protect yourself from loss.

 

I am on the board of directors of a homeowner association that is facing its third insurance policy cancellation because of excessive claims. We have not been able to find an insurance company that will accept us. Can you help?

Probably. As an independent broker, we work with many insurance carriers. Some will accept high risks for a higher premium. Sometimes there are conditions and exclusions attached to these policies, but they are available except In extreme situations.

 

May a homeowner in an HOA make a direct claim to the association's insurance company under the association's general liability policy, even though they are not named on the master policy?

Unfortunately, yes. Under California law, upon,recelving notice of a claim, every insurance broker or agent must immediately provide notice of the claim to the insurer. Also, when a homeowner makes a claim without notifying the board or management company first, it can place the board and/or management company in the difficult position of not being able to determine whether the claim should have been made, who or what caused the damage, whether the claim is excessive, and much more.

 

Can a member of the board of a homeowner association, or association's management company, talk to the association's insurance agent or broker to inquire whether a matter is covered under its policy and how such a claim might affect its premium, without the conversation constituting a claim on the policy?

Yes, but it is important for the caller to be very clear when he or she makes the call.

 

What is an Earned Premium and an Unearned Premium?

Policyholders usually pay their premiums in advance. However, insurance companies do not immediately account for these premiums in their earnings. Rather, they earn the premium at even rates throughout the term of the policy. Therefore, the portion of premium that applies to the expired portion of the policy becomes the earned premium. Similarly, the portion of premium received that applies to the remaining term of the policy becomes the unearned premium reserve.

 

What is the definition of a peril in the insurance industry?

A peril is an event such as a fire , earthquake, water damage, or theft that may damage your property or cause you to suffer a loss. Perils are listed in insurance policies. Not all policies are the same.

 

What is floater insurance?

Floater insurance is a type of insurance policy that covers easily movable, valuable, personal property such as jewelry, watches, furs, antiques, cameras, musical instruments, firearms, paintings, sculptures, and collectibles. Not all floater policies are the same. These policies generally cover only one item such as a stamp collection. This often makes it necessary to obtain multiple floater polices.

 

Other than age, what are the major factors that determine the cost of life insurance?

The factors include: (1) The type of policy, (2) gender, (3) blood pressure, (4) height and weight, (5) occupation, (6) physical health history, (7) mental health history, (8) family health history, (9) history of surgical procedures, (10) tobacco use, (11) cannabis use, (12) illegal drug use, (13) driving record, (14) criminal record , (15) travel to dangerous countries, (16) bankruptcy, and (17) high risk recreation.

 

What is Long-Term Care (LTC) Insurance?

Long-term care insurance is a form of private insurance that generally provides coverage for all or part of the cost of assisted living facilities, in-home care, or adult day care for people who are 65 or older with chronic health conditions that require constant care. Long-term care insurance is very expensive which means that most people must acquire the coverage when they are between the ages of 45 and 55. Long-term care is not provided by standard health insurance policies, Medicare, or Medicaid. In many cases, the adult children of older parents are paying the premiums for their parents. Alzheimer's is becoming a significant motivating factor. See: Sell Your Life Insurance Policy.

 

What is a copay?

A copay is a fixed out-of-pocket amount paid by an insured for covered services. It is a standard part of many health insurance plans. Insurance providers often charge copays for services such as doctor visits or prescription drugs. Copays are a specified dollar amount rather than a percentage of the bill and they are usually paid at the time of service. Not all medical services require a copay.

Plans with relatively high premiums are likely to have low co pays while plans with low premiums are more likely to have high copays.

 

What is the Medical Information Bureau?

The Medical Information Bureau is a nonprofit organization that stores the health and medical information of people who were previously insured. Insurance companies have access to this information and use it to determine the premium price for individual life and health insurance policies.

 

What Is a ViaticaI Settlement?

A viatical settlement is an agreement in which a person who is terminally or severely ill or generally over the age of 85, sells their life insurance policy at a discount from its face value for immediate cash. In exchange for the cash, the seller of the life insurance policy relinquishes the right to leave the policy's death benefit to a beneficiary of their choice. The buyer of a viatical settlement pays the seller cash and pays all future premiums left on the life insurance policy. The buyer becomes the sole beneficiary and receives the full amount of the policy when the original owner dies. See: Sell Your Life Insurance Policy.

 

What is an incontestability clause?

An incontestability clause is a common clause found in life insurance policies that protects the insured against the insurance company refusing to pay a claim due to a mistake on the application for insurance. For example, if the insured stated he weighed 189 pounds but actually weighed 192 points, the insurance company cannot refuse payment. Most incontestability clauses specify that the policy will not be voidable after two or three years and cannot protects the insured against a clear case of fraud.

 

Is life insurance a financial asset?

Permanent life insurance policies that build cab value are definitely assets. Other insurance policies with face amounts of $100,000 or more, including term policies, may be saleable after the insured reaches the age of 70 or more depending upon his or her health. See: Sell Your Life Insurance Policy to obtain a free quote.

 

What is an annuity and how do annuities work?

An annuity is a contract issued and distributed by life insurance companies through brokers and agents. The contracts payout invested funds in a fixed income stream usually for retirees. The payments may be for a fixed period of time or for the rest of the life of the annuitant. Annuity products are regulated by the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA).

 

What is a Collateral Assignment of Life Insurance?

A collateral assignment of life insurance is a conditional assignment appointing a lender as an assignee on a life insurance policy up to the amount owing on the loan at the time of death. The death benefit becomes security or collateral for the loan. A collateral assignment is commonly required for business loans as opposed to secured real estate loans. A collateral assignment is usually irrevocable until the loan is paid.

 

I am buying a large parcel of land in the Antelope Valley that I intend to leave as a legacy for my young grandchildren. I will be paying for the land over 10 years. Is it possible to buy a declining term insurance policy that will guarantee the property is inherited debit free?

Absolutely. For information see: Declining Balance Life Insurance Policies.

 

What is Final Expense Life Insurance?

The advantage to final expense life insurance is that the benefits are paid to the named beneficiary almost immediately, whereas most life insurance companies take several weeks to pay the beneficiary. Unless a beneficiary has cash available to pay final expenses, a final expense life insurance policy is an excellent choice.

 

My spouse recently passed away and is no longer in need of the insurance we have on my life. The policy is expensive and I would like to stop making the payments. Do you have any suggestions?

Yes. Many life insurance policies can be sold for many times the cash surrender value. In fact, term policies with no cash surrender value can often be sold . Do not let the policy lapse without first obtaining information on the value of the policy. It may be worth more than you realize.

 

What is the American Agency System?

The American Agency System is a method of selling insurance in the United States. The American Agency System is an insurance system made up of independent insurance agents or brokers who sell insurance policies offered by many companies rather than by captive agents who can only sell insurance policies offered by their employers. Examples of captive insurance agents include Farmers, Allstate, and State Farm. Independent agents or brokers represent their clients, the policy buyers, and owners. Captive agents represent their employers, the insurance companies.

 

What is the California Insurance Guarantee Association and how does it work?

The California Insurance Guarantee Association (CIGA) and the California Life and Health Insurance Association are funds that provide limited guarantees to policy holders in the event that an admitted insurance company becomes insolvent. It does not provide protection for the insolvency of non-admitted carriers. For information, consumers should visit the California Department of Insurance which provides coverage amounts and exclusions.

 

What is Lloyd's of London and how does it operate?

Lloyd's is not an insurance company. It is an insurance and reinsurance marketplace that operates as syndicates to provide insurance coverage. The syndicates specialize in different types of risks and consist of both individuals and companies. Based in London, it is the oldest active insurance marketplace in the world. Lloyd's writes a highly diverse range of unusual insurance risks. See: Admitted Insurance Carriers and Non-Admitted - Surplus Lines Insurance Carriers.

 

What are Lloyd's Organizations and how do they operate?

Lloyd's organizations are insurance syndicates modeled after Lloyd's of London, but they are not affiliated with that organization. They are sometimes referred to as American Lloyd's.

 

What is a direct writer in the insurance industry?

A direct writer IS an employee of an insurance company, who like captive agents, represent only one company. Unlike independent insurance brokers, they do not shop for the best rate and terms but sell only the products offered by their employer. See: Independent Insurance Brokers vs. Captive Agents.

 

What is self-insurance?

Self-insurance means no insurance. It is a decision to rely on one's own resources to cover 100% of all future losses, which may include the cost of defending a lawsuit, instead of buying insurance from an insurance carrier. Some individuals and businesses set aside a contain percentage of their income to cover eventual losses. Self insurance or no insurance is an extreme form of gambling. Even large insurance companies protect themselves by acquiring reinsurance.

 

What is an insurable interest?

When someone has an insurable interest, it means they have a financial stake in a person or property, such that any damage or loss would cause them a monetary loss. A person must have an insurable interest in another person in order to buy a life insurance on that person must have an insurable internet in property in order to buy insurance on that person. In short, a person must have an insurable interest and mortgage lender must have an insurable interest. Renters do not have an insurable interest in rental property, but they do have an insurable interest in their personal property.

 

What is the Line of Sight Rule in California, how does it work, and when does it apply?

The Line of Sight Rule applies when repairing property that is partially damaged. It requires the insurance company to restore the damaged item to its pre-loss condition, or to a reasonably uniform appearance. The California Insurance Code states.

"When a loss requires replacement of items and the replaced items do not match in quality, color or size, the insurer shall replace all items in the damaged area so as to conform to a reasonably uniform appearance."

Uniform means repair work should not be unreasonably noticeable after completion. The results should be identical or better than before the damage. For example, they can't replace a few broken white tiles with off-white tiles. Even if they were to find white tiles, it's not uncommon for all of the tiles to be replaced due to natural variations in tile, the way in which colors and surfaces change over time, and the difficulty in matching new grouting to old. Having even slightly different colored tiles would make the area no longer "conform to a reasonably uniform appearance."

Line of Sight means an area in your field of vision and applies to interior walls, exterior walls, siding, brick, paint, moldings, cabinets, counters, carpeting, hard surface floors, and more.

 

We will be contacting you shortly to make a claim on a life insurance policy that was purchased through your firm. Can you recommend an attorney that can assist us with probate questions?

Absolutely. We regularly work with probate attorneys, estate planning attorneys, and Realtors that specialize in the sale of real estate and businesses that are in probate. Contact us by phone or email.

 

How important is it to have insurance on vacant land in a remote area?

It is highly important for many reasons and is quite inexpensive. See: Vacant Land Liability Insurance.

 

How often are life insurance claims denied?

Not all life insurance policies are the same. There are some situations under which a life insurance company may be excused from paying a death benefit. Reading and understanding the policy terms is the only way to be certain of its terms and exclusions. Most insurance companies will not pay a death benefit if the cause of death is suicide and the suicide is committed within two years of the inception of coverage. Death resulting from engaging in defined dangerous activities such as skydiving, scuba diving, or auto racing may be excluded. Death resulting from participation in criminal activity is usually excluded. If you are engaged in dangerous activities, you should read your policy carefully to see if they are excluded from coverage. Far less than 1% of all claims are challenged by life insurance companies.

 

What is the Business Judgment Rule?

According to the California Corporations Code, even though officers and directors are deemed fiduciaries, boards are not required by law to make the "right" decision. The California Corporations Code protects directors from personal liability if they make informed decisions that result in damage or loss to others, provided their decisions were made: (1) In good faith, (2) In a manner which the directors believe to be in the best interests of the corporation, and (3) With such care, including reasonable inquiry, as an ordinarily prudent person in a like position would use under similar circumstances. The rule does not apply to self-dealing, fraud, conflicts of interest, bad faith, or corporate waste.

 

Office Hours

Our regular office hours are from Monday through Friday 9:00 am to Noon and from 1:00 pm to 5:30 pm. We are closed all legal holidays. Clients are provided cell phone numbers so you can reach us 24/7/365.

 

What is AM Best and why are they important?

AM Best, established in 1899, is the world's largest credit rating agency specializing in the insurance industry and insurance-linked securities. Best's credit ratings are an essential tool for assessing an insurer's financial strength, credit worthiness, and ability to honor obligations to policy holders.

 

What is a mutual insurance company?

A mutual insurance company is a private insurance company that is owned by its policyholders. Mutual insurance companies provide insurance coverage to its members who are policyholders at or close to its costs. Any profits from premiums and investments are distributed to the policyholders as dividends or by a reduction in premiums. Mutual insurance companies are not listed on stock exchanges since they are privately owned companies.