Commercial Auto Insurance in Oregon

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Commercial Auto Insurance has five different sections: Covered Autos, Liability Coverage(s), Physical Damage Coverage(s), Conditions, and Definitions. You will find these all inside your policy agreement. This type of policy can be written as a stand-alone policy or included in Commercial Package Policy.  Today, we will be discussing Section I- Covered Autos.

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WHAT AUTOS ARE COVERED IN A COMMERCIAL AUTO INSURANCE POLICY? 

The following Autos are ones that may be covered in a Commercial Auto Policy:

  1. Any “Auto”
  2. Owned “Autos” Only- Only those autos you own. Even autos you purchase/acquire after your policy has started. Also, if you use a non-owned trailer, but, it’s attached to a vehicle you own that’s covered- the trailer is covered in this case as well. 
  3. Owned Private Passenger “Autos” Only- The private passenger autos you own- including ones acquired after the policy began. 
  4. Owned “Autos” other than private passenger “Autos” Only- Only those “Autos” you own that are not of the private passenger type, also, again, including autos you acquire after the policy began. And non-owned trailers pulled by your owned vehicle that’s covered (trailers are covered in this case)
  5. Owned “Autos” Subject to No Fault- The autos you own that are required to have No-Fault benefits in the state where they are licensed or principally garaged. This includes those autos you acquire after policy began provided they are required to have no-fault benefits also.
  6. Owned “Autos” subject to an Uninsured Motorist Law- Only those autos you own that because of the law in the state where they are licensed or principally garaged are required to have and can’t reject the uninsured motorist coverage. Again, if you acquire an auto that is subject to this law after policy begins, it is covered. 
  7. Specifically Described Autos- Only those autos described in the Declarations for which a premium charge is shown and also for non-owned trailers attached to covered auto.
  8. Hired “Autos” Only- Only those autos you lease, hire, rent or borrow. This does not include any auto you lease, hire, rent or borrow from any of your employees, partners (if you are a partnership) members (if you are an LLC) or members of their household. 
  9. Non-owned Autos Only- Only those autos you don’t own, lease, rent or borrow that’re used in connection with your business. This includes “autos” owned by your “employees”, partners (if you are a partnership), members (if you are a limited liability company) or members of their households but only while used in your business or your personal affairs.

If an auto is not specifically described, newly acquired autos are automatically covered for the remainder of the policy period. For a specifically described auto a newly acquired auto will be considered a covered auto only if: 

  1. Insurance companies covers all autos the insured owns for that coverage or it replaces an auto that had that coverage. 
  2. The insured informs the insurer within 30 days of acquisition.

FOR OREGON BUSINESS AUTO INSURANCE, THE FOLLOWING INSTANCES ARE EXCLUDED FROM COVERAGE: 

  1. Nuclear Hazard: The explosion of any weapon employing atomic fission or fusion; or nuclear reaction or radiation, or radioactive contamination, caused by anything.
  2. Military/War Action: War- whether it’s declared or not, civil war, 
  3. Loss that was not Accidental: Freezing, electrical or mechanical breakdown, wear and tear. Any kind of blowout, puncture, or damage to tires. 
  4. Equipment that receives sound (Inc accessories): Visual, audio, data electronic devices designed to be used with that type of equipment (tapes, discs, etc) If the equipment is permanently installed in the covered auto and operated from the auto’s electrical system, it will be covered. 
  5. Electrical Equipment: Any electronic equipment, whether permanently installed or not, that receives/transmits audio/visual/data signals that’s not designed to just reproduce sound, including accessories. The exception here is equipment that’s necessary for the normal operation of the covered auto or the monitoring of the covered auto’s operating system, etc. 
  6. Radar/Laser Detectors: Devices designed to detect equipment that measures speed, such as laser or radar detectors, or any device used to distort the speed measuring equipment.
  7. Stunt Activity/Racing/Demolition: If the auto is used in any type of professional racing contest, demolition contest, or stunt activities. Also not covered during practice or prep for any of these activities.

COMPREHENSIVE COVERAGE:

Comprehensive coverage in Oregon covers anything that is not specifically excluded from the policy, except a collision with another object or overturned vehicle. Also, if the insured carries coverage for glass breakage under Comprehensive they will be covered if they hit an animal, or if they experience damage due to a falling object or missile. One thing to consider- if the glass breaks due to a collision, it may be covered under Collision Coverage. 

BUSINESS AUTO COVERAGE IN OREGON – SPECIFIED LOSSES THAT ARE COVERED: 

  • Fire
  • Lightning
  • Explosion
  • Theft
  • Windstorm
  • Hail
  • Earthquake
  • Flood
  • Mischief
  • Vandalism
  • Sinking
  • Burning
  • Collison
  • Derailment of anything transporting a covered vehicle

This coverage is not as all-inclusive as Comprehensive Coverage- it specifies the losses/damage it covers- if it is not specified, it’s not covered. 

COLLISION COVERAGE:

This type of coverage will cover the auto/vehicle if it collides with another object or is overturned. Also, if the glass breaks due to a collision, the glass may be covered under this coverage as well. 

TRANSPORTATION EXPENSE:

This is a coverage extension that states that if the insured carries Comprehensive or Specified Cause of Loss Coverage, the insurance company will pay up to $20 per day with a max limit of $600 if the loss is due to theft. There is a 48 hour wait period with this extension and the insurance company stops paying this extension if the vehicle is recovered/returned, or when they payout for the loss. 

TOWING:

This coverage may be added by increasing premium. The insurance company will pay up to the limit of insurance shown in the agreement for labor costs and towing every time a covered vehicle becomes disabled. So, this coverage is per occurrence. However, the one condition is that labor must be performed at the location where the vehicle becomes disabled, otherwise, it’s not covered. 

Visit our blog for more information on commercial auto insurance coverage options!

Graybeal Group, Inc. Offers Widest Range of Products and Pricing in Oregon

Graybeal Group, Inc. is a professional Insurance company with licensed agents and staff.  With over three decades of experience, The Graybeal Group takes pride that our agents are specialized in the needs of our customers in the areas of Crop/Agriculture, Hemp, Non-Profits, Pasture Rangeland and Forage, and Farm & Ranch.  Get in touch today to learn more about our commercial auto insurance policies!

Being able to provide the time for our agents to focus on their specialty allows us to give you – our clients – the needed coverage for your home and business. At Graybeal Group, Inc., we are committed to providing an experience that empowers our clients so they are educated on their coverage and the value we provide above all others.

For more information, we invite you to call Graybeal Group, Inc. at (541) 567-5523. 

What is Oregon Employment Practices Liability Insurance?

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employment practices liability insurance oregon

Commonly known as EPLI, Employment Practices Liability Insurance covers businesses against claims from employees. Where Worker’s Compensation and Employers Liability policies exclude, EPLI includes. EPLI includes such things as: sexual harassment, wrongful termination, discrimination, etc. The employee brings suits against an employer when they feel their legal rights have been violated. 

IS OREGON EPLI ONLY NECESSARY FOR LARGER COMPANIES?

No. Most people do think of this type of insurance as only necessary for larger organizations, however, the reality is, smaller companies face a lot of the same risks! As this idea became more recognized, insurance companies started offering EPLI coverage for smaller companies.  They can add it as a stand-alone policy or in addition to their Businessowners policy. Also, Employment Practices Liability Inusrance protects against claims from past, present, and potential employees. Learn more about insurance for business owners, click here!

WHAT ARE SOME OF THE RISKS OREGON EPLI INSURES AGAINST? 

  1. Wrongful Termination
  2. Sexual Harassment
  3. Discrimination
  4. Negligent Evaluation
  5. Breach of Employment Contract
  6. Failure to Employ or Promote
  7. Wrongful Infliction of Emotional Stress
  8. Mismanagement of Employee Benefit Plans
  9. Deprivation of Career Opportunity

The premium costs associated with this kind of coverage are dependent on the type of business, number of employees, and other risk factors such as previous claims or lawsuits brought against the organization/employer.

These types of policies also cover paying the costs for judgments/settlements and the cost to reimburse the insured for defense costs that occur in defense of a claim or suit, regardless if the company wins or loses the lawsuit. 

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WHAT IS EXCLUDED FROM AN OREGON EPLI POLICY? 

Generally, these types of policies don’t pay for civil or criminal fines, punitive damages, or if the liabilities are covered by other policies, i.e. Workers Comp or Employer Liabilities Policy. 

Conditions that the insurance company may require the insured adhere to: 

  1. Distribute Employee Handbooks addressing the company’s policies
  2. Provide employees with information on steps to take if they are subject to sexual harassment or discrimination
  3. Maintained documented records of all complaints and the steps taken to prevent and solve employee disputes
  4. Install an effective hiring/screening program to avoid discrimination in hiring

Stop by our blog to learn more about the benefits of worker’s compensation insurance!

Graybeal Group, Inc. Offers A Wide Range of Products and Pricing

Graybeal Group Inc. is a professional Insurance company with licensed agents and staff.  With over three decades of experience, Graybeal Group takes pride that our agents are specialized in the needs of our customers in the areas of Crop/Agriculture, Hemp, Non-Profits, Pasture Rangeland and Forage, and Farm & Ranch. 

Being able to provide the time for our agents to focus on their specialty allows us to give you – our clients – the needed coverage for your home and business.

For more information, we invite you to call Graybeal Group Inc. at (541) 567-5523.

Pasture Rangeland Forage Insurance

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Pasture Rangeland Forage Insurance is designed to provide insurance coverage on pasture, rangeland, or forage acres.  This program is based off the national rainfall index which determines precipitation for coverage purposes.  It does not in any way, measure production or loss of products themselves.

Pasture, Rangeland, and Forage (PRF) Insurance Program in California, Oregon, and Nevada offer livestock producers risk protection for losses of forage produced for grazing or harvested for hay.  The products are made to function in many range and pasture environments. They use technology to determine when someone has suffered a loss by looking at The Rainfall Index over the past years for that same time period.

The Rainfall Index uses National Oceanic and Atmospheric Administration Climate Prediction Center (NOAA CPC) data.  Then, the Prediction center uses a grid system that will determine precipitation amounts within an area. Each grid is 0.25 degrees in latitude by 0.25 degrees in longitude, basically, this is approximately 17 by 17 miles at the equator.

Pasture Rangeland Forage Insurance was created and designed to help protect forage loss that results from a lack of precipitation. Keep in mind, the coverage is applied to specific intervals throughout the policy year, so, don’t confuse this insurance with Drought Insurance. PRF Insurance was not designed to insure against severe or ongoing drought.

WHAT IS THE RAINFALL INDEX PLAN IN RELATION TO PASTURE RANGELAND AND FORAGE INSURANCE?

The Rainfall Index (RI) plan of insurance is a risk management tool to ensure against a decline in an index value that is based on the long-term historical average precipitation for an approximate 17×17 mile grid over specific two-month time intervals. The intervals start with Jan/Feb, Feb/Mar, etc. A producer may not choose overlapping intervals (Jan/Feb and Feb/Mar for example). A producer must select a minimum of two index intervals for coverage under the Pasture, Rangeland, and Forage Insurance Plan. The insured selects which index intervals to cover and the amount of coverage. The selection of index intervals is critical to the effectiveness of the RI plan as a risk management tool. Coverage is based on indexes for the grid, not the producer’s actual rainfall.

“The RMA has been working for a long time to provide subsidized coverage for livestock producers similar to what crop farmers have enjoyed for decades,” says Max Thomas, of Silveus Insurance Group, Lubbock, TX. “And this is the first time RMA has rolled out a program that offers a buy-up, low-deductible coverage for rancher’s basic crop which is grass and hay.”

You need to make several choices when you choose to insure your grazing or hay production, including coverage level, index intervals, irrigated practice, productivity factor, and number of acres.

That’s why you should work with your licensed crop insurance agent to view the Grid ID Locator map and index grids for your area, and assign acreage to one or more grids based on the location and use of the acreage to be insured. RMA encourages the use of the Grid ID Locator, historical indices tool, and decision support tools available on RMA’s website to help decide whether PRF is the right insurance coverage for your operation.

COVERAGE AND CLAIMS

Coverage for Pasture Rangeland and Forage Insurance is based on your selection of coverage level, index intervals, and productivity factor.

The index interval is a two-month time period.  Your agent should select the time period that precipitation is most important to your operation.  You are insuring a rainfall index that’s expected to estimate production, it does not measure direct production or loss.

You select a productivity factor to match the amount of protection to the value of the production that best represents the operation and the productive capacity of your acreage. You don’t have to ensure all of your acreage, and you also cannot insure more than what is considered insurable.

Pasture Rangeland Forage Insurance coverage is for a single peril — lack of precipitation. Coverage is based on the experience of the entire grid. It is not based on individual farms or ranches or specific weather stations in the general area. Insurance payments are determined by using NOAA CPC data for their grid(s) and index intervals that were chosen to insure. When the final grid index falls below the policyholder’s “trigger grid index”, the producer may receive an indemnity.

PRF policies can be bought from a crop insurance agent by the sales closing date of November 15th, 2019.  

PRF is available in the 48 contiguous states with the exception of a few grids that cross international borders.

WHAT ARE SOME BENEFITS OF THE PASTURE RANGELAND AND FORAGE INSURANCE PROGRAM?

The program is designed to give producers more options as a business owner and manager. It may provide more cash flow to restock herds once a drought is over, buy more feed, lease alternative pastureland, or pay leases when herds have been culled to very low levels.

Pasture, Rangeland, and Forage Insurance, PRF Insurance, is a policy that’s designed for ranchers! It’s subsidized, rated well, and covers exactly what causes sleepless nights! How could you NOT take advantage of this policy? Plus, the ROI is unheard of!

Allow our Pasture Rangeland and Forage Insurance Specialists who grew up on ranches and understand the specific needs of every rancher, to help you discover up to 300% ROI from this policy! We specialize in this policy and we are happy to design the perfect policy to fit your land and ranch operation needs! 

One of our Specialists, Dylan Pettyjohn, was born and raised on a ranch in Morrow County, OR.  He worked on the carrier side as a crop adjuster for 6 years for a Federally approved insurance provider.  He was promoted to Regional Marketing Manager where he helped train agents on Crop Insurance so they could better assist the ranchers and farmers they served.

Dylan was also utilized for his input in CREATING the Pasture Rangeland and Forage Insurance Policy- how it works, how to quote it, and how to maximize it for the Rancher and Farmer (he did this for 3 years across 9 states).

A lot of folks ask-

WHAT IS THE DIFFERENCE BETWEEN PASTURE RANGELAND AND FORAGE INSURANCE (PRF) AND DROUGHT INSURANCE?

Pasture Rangeland and Forage Insurance (PRF) is not drought insurance. This Insurance Program will not insure against abnormally windy conditions or abnormally high temperatures. A drought may cause a decline in the index value of your Pasture, Rangeland, and Forage policy to the point a payment for loss is issued if you’re eligible, however, a drought being declared in a state, county or area does not, by itself, trigger and indemnity payment under PRF Insurance.

Graybeal Group, Inc. Offers a Wide Range of Products and Pricing

Graybeal Group, Inc. is a professional Insurance company with licensed agents and staff.  With over three decades of experience, The Graybeal Group takes pride that our agents are specialized in the needs of our customers in the areas of Crop/Agriculture, Hemp, Non-Profits, Pasture Rangeland and Forage, and Farm & Ranch. 

Being able to provide the time for our agents to focus on their specialty allows us to give you – our clients – the needed coverage for your home and business. At Graybeal Group, Inc., we are committed to providing an experience that empowers our clients so they are educated on their coverage and the value we provide above all others.

For more information, we invite you to call Graybeal Group, Inc. at (541) 567-5523. 

Insurance Coverage for your Online Business

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online business insurance graybeal group

When you operate an online business, you have many things to think about, not least of which is building and preserving your clientele, and securing the equipment you will need to run your business effectively. You also want to ensure your business license is in order. 

Though you might not think of it as a priority but acquiring insurance for your online business is also important. For many Internet business owners, online business insurance could seem unnecessary. After all, what could happen that would necessitate being protected from legal action or serious loss?

In fact, business owners are well-advised to protect themselves and their online businesses by securing insurance. Insurance can protect against loss of income from circumstances such as the Internet or host failures. Your business insurance also covers you from liability threats like accusations of plagiarism, security breaches in customer information, and copyright infringement. 

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Other Types of Threats Online Businesses Could Face

  • Hackers and cyber theft
  • Computer viruses
  • Breach of contract allegations
  • Product liability
  • Suspension from an e-commerce platform

Insurance for Online Businesses Can be Difficult to Find

Even though the Internet is more than two decades old, it nonetheless is still a relatively new entity. So, the insurance industry does not have the actuarial data regarding the probability of various types of losses for an Internet business. This makes it challenging for insurers to set premiums rates. 

This dearth of actuarial data also makes it difficult for business owners to shop around and know when they are receiving the best value for their insurance coverage. 

This doesn’t change the fact that it is still vital to carry insurance for your online business. 

A list of all the types of insurance a small business could need!

Types of Insurance That an Online Business Needs

The type of Internet insurance you should carry depends on the size of your business and whether you employ anyone. The following are the types of coverages that an online business should have:

Cyber Liability Insurance – For Online Business

This coverage protects your online business in the event of a data breach if the information is stolen or leaked. You’ll find that most cyber liability insurance policies cover business interruption, computer restoration, ransomware expenses, public relations, and legal fees having to do with a data breach. 

As hackers and other online threats become more advanced, it is essential for your online business to carry cyber liability insurance. 

Workers’ Compensation Insurance – For Online Business

If you have hired employees for your online business, you will want workers’ compensation insurance. You need to be prepared when accidents happen, and, over time, they likely will. 

Worker’s comp will protect you against an injured employee’s medical expenses and lost wages from time away from work. This type of insurance will also cover your business in the event of injury lawsuits filed by employees. 

While you do everything you can to provide a productive and safe work environment, it is still important that your business is covered when accidents happen. 

Commercial General Liability Insurance – For Online Business

This insurance will protect your Internet business from third-party liability for property damage or personal injury on your business premises, as well as from liability for injury caused by any product your business sells. If you sell products and someone is injured by them, the manufacturer might be sued, but so could you. 

You also might have to carry Commercial General Liability insurance if you sell products on Amazon. This depends primarily on how much you are selling on their platform. It would be helpful for you to research Amazon’s and other e-commerce platform’s requirements to be sure you have adequate coverage. 

Employment Practices Liability Insurance – For Online Business

As you build your online business and you add more employees, you should consider enhancing your coverage. Although you allow for a safe work environment, accidents can still occur. Also keep in mind that we live in a litigious society. It is not uncommon for people to take legal action against their employers in this country. 

Employment practices liability covers businesses from the following occurrences: 

  • Discrimination 

  • Wrongful termination

  • Harassment 

  • Invasion of privacy

  • Negligent evaluation

  • Mismanagement of employee benefits 

  • Miscellaneous employment-related issues

Additionally, employment practices liability insurance policies also cover you – the business owner. Also protected are your executive staff such as managers and directors. 

Chargeback Insurance – For Online Business

This type of insurance is meant to specifically cover retailers who are paid primarily with credit or debit cards. It protects your online business from loss in the event that charges are made with stolen cards or counterfeit card numbers. 

Seller Suspension Insurance – For Online Business

This insurance becomes relevant if your business operates by selling via an e-platform like Amazon. You should know that your account could be suspended at any time by the platform. You can appeal the suspension and win, however, your business operations could be halted for weeks or possibly months. This would obviously cause a major loss of income. Seller suspension insurance is designed to help you cover losses, as well as expenses connected with having your account reinstated. 

 

Graybeal Group, Inc. Offers The Widest Range of Products and Pricing

Graybeal Group, Inc. is a professional Insurance company with licensed agents and staff.  With over three decades of experience, The Graybeal Group takes pride that our agents are specialized in the needs of our customers in the areas of Crop/Agriculture, Hemp, Non-Profits, Pasture Rangeland and Forage, and Farm & Ranch. 

Being able to provide the time for our agents to focus on their specialty allows us to give you – our clients – the needed coverage for your home and business. At Graybeal Group, Inc., we are committed to providing an experience that empowers our clients so they are educated on their coverage and the value we provide above all others.

For more information, we invite you to call Graybeal Group, Inc. at (541) 567-5523. 

Beginners Guide to Umbrella Insurance

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We all know that life occasionally throws us curveballs, coming at us with unexpected accidents and troublesome news that we have to be prepared for and deal with. It is the same with insurance.  With so many different scenarios that could happen to us when inside our homes, driving our cars, or on our boats, you need to be sure you always have sufficient insurance to be prepared for the unexpected. That is where personal umbrella insurance comes in. 

Personal umbrella insurance serves an important purpose, as it provides liability protection above and beyond the policy limits on our home, vehicle, and boat. Keeping in mind those limitations, personal umbrella insurance – also known as personal liability insurance – takes effect after you exceed those limits, thus broadening your protection if a claim or lawsuit is filed against you. 

Umbrella insurance resembles but is not necessarily the same as excess liability insurance, which provides you with higher caps on the liability coverage you already have. Here is the difference. The vast majority of umbrella insurance also gives you additional coverage that is not included in your base insurance policies. Examples of this are paying out for legal fees and damages if you are accused of slander, which is a false statement made, or libel, a false written statement. 

How Umbrella Insurance Works

Here is an example of a particular circumstance where umbrella insurance could be very helpful: 

You speed through a red light and T-bone another car.  There is major damage to the vehicle, and several people sustain injuries. The car requires $25,000 in repairs, and medical care for the injuries comes to $275,000. Additionally, the driver of the other car is an orthodontist who now cannot work for many months because of a broken arm, and he sues you for $200,000 in lost earnings. 

You find yourself owing $500,000 from this accident. Now, if your policy shows $300,000 in liability coverage with your car insurance, you will be responsible for paying the remaining $200,000. With personal umbrella insurance, it would pay the difference between what your primary insurance covers and what you still owe. Your umbrella policy also gives you coverage for all legal costs in the lawsuit. 

What Umbrella Insurance Covers

Put simply, umbrella insurance will protect you and everyone in your household against lawsuits that involve personal injury to others, damage to other people’s property, and an array of claims like defamation, landlord liability, and false imprisonment, depending on your policy. 

Personal umbrella insurance covers what your car, home, or boat insurance does not cover, which includes:

  • Claims for bodily injury
  • Personal injury lawsuits 
  • Property damage claims
  • Landlord liability claims

If you have personal umbrella insurance with $1 million of liability coverage, and you were sued for that full amount, your insurer would pay the $1 million in addition to providing your legal defense or cover your fees. Be aware, however, that a “retained limit” – which is like a deductible in that you are responsible for paying it before your coverage starts to pay out – could apply. 

Details and exclusions will differ quite a bit between umbrella policies. 

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What Umbrella Insurance Does Not Cover

Umbrella insurance will not cover injuries you sustain or property damage, as you will need other types of coverage for that. This could include health insurance or collision coverage on your car insurance.  Personal umbrella insurance also will not protect you from liability related to your business unless you have a commercial umbrella policy. 

The vast majority of personal umbrella insurance policies will not cover liability originating from the breach of a contract you entered into. For instance, if a landscaping company takes legal action against you because you have not paid for the finished work as stipulated under the signed contract, your personal umbrella insurance policy is not likely to apply. Also, if you injured someone on purpose or committed a crime, your umbrella insurance policy will not help you. 

Most of the time, exclusions apply to boats, as well. There are certain companies that will only cover specific sizes or types of watercraft. Others will not cover them at all without having an existing boat insurance policy. 

Who Should Have Umbrella Insurance?

You would be wise to have personal umbrella insurance if you rent property, employ staff at your house, have a trampoline, pool, hot tub, or hold large parties at your home. Keep in mind that if a guest at your residence is injured, your homeowner insurance might not be adequate to cover the cost of a claim.  You likely could be sued by the person who is injured and experience significant financial consequences. 

Here at Graybeal Group Inc. we recommend that everyone should consider carrying an umbrella policy. If you engage in a high-risk activity or hobby that increases your odds of getting sued—such as having a teenage driver, owning a swimming pool or entertaining frequently—it is wise to supplement your insurance with a personal umbrella liability policy.

How Much Coverage Do I Need?

You’ll want to take into consideration not only your total personal assets but also your potential personal risks. For example, do you operate a business in your home and have employees and clients to your home on a regular basis? Does your profession or location of your home make you an easy target for a big settlement? Determine your personal risks to evaluate the amount of additional liability coverage that makes the most sense for you.

Coverages start at $1 million, and can go as high as $10 million. When considering the value of the umbrella policy, discuss your personal needs with Ferranti-Graybeal Insurance.

What Type of Umbrella Insurance is Appropriate for You?

When you look into personal umbrella insurance, you should initially conduct a full evaluation of your home and property, bank account balances, investment accounts, and all other assets. If you want maximum liability protection, you should have adequate umbrella insurance to replace all of your assets in the event of a lawsuit being filed against you or a family member. This insurance is commonly sold in $1 million increments. 

Cost of Umbrella Insurance

The cost of personal umbrella insurance will differ depending on the amount of coverage you purchase.  It tends to be quite affordable. The typical price falls in between $150 to $300 annually for $1 million in coverage, according to the Insurance Information Institute. More often than not, the insurance company you select will require you to have a particular amount of vehicle, home or watercraft insurance. The limits on these policies must be exhausted before the umbrella insurance will pay. 

Additional liability insurance is inexpensive when compared to the added coverage you gain. Depending on the policy value and your personal risk factors, such as recent auto tickets, your credit rating and more, a $1 million umbrella policy typically costs about a dollar per day. Costs go up an additional $50 to $75 for each million thereafter your current liability insurance offers you enough protection?

Choosing the Right Personal Umbrella Insurance Policy

To begin with, assess your financial situation, your level of risk, and your existing insurance policies. 

We invite you to contact one of our agents at Graybeal Group, Inc. who will review your situation and advise you of the various types of personal umbrella insurance policies available. We will work with you to identify the policy that provides you with the liability protection that best serves your needs. 

Graybeal Group, Inc. Offers The Widest Range of Products and Pricing

Graybeal Group, Inc. is a professional Insurance company with licensed agents and staff.  With over three decades of experience, The Graybeal Group takes pride that our agents are specialized in the needs of our customers in the areas of Crop/Agriculture, Hemp, Non-Profits, Pasture Rangeland, and Forage, and Farm & Ranch. 

Being able to provide the time for our agents to focus on their specialty allows us to give you – our clients – the needed coverage for your home and business. At Graybeal Group, Inc., we are committed to providing an experience that empowers our clients so they are educated on their coverage and the value we provide above all others.

For more information, we invite you to call Graybeal Group, Inc. at (541) 567-5523. 

Is Pasture, Rangeland and Forage Insurance Right for Your Farm?

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The USDA Risk Management Agency (RMA) Pasture, Rangeland, and Forage Insurance (PRF) program is a risk management tool that producers can rely on to protect their operations from low forage production as a result of a lack of rain. If your farm produces hay or grazes livestock on pasture, then you are eligible for PRF insurance. 

PRF is a national program that offers policies in all 48 contiguous states. In contrast to single crop insurance, which reimburses producers for yield or revenue losses relative to their own production history, PRF compensates farmers for below-normal precipitation – including rain or snow – in their area. PRF is what is referred to as a genuine “single peril” insurance product because low precipitation is the only cause of loss that it insures. 

“The Risk Management Agency started the rainfall insurance program because – unlike crop producers – ranchers have historically not been able to insure their crops of forages for grazing and haying,” says Monte Vandeveer, an Agricultural Economist at Kansas State University. 

Vandeveer adds, “The insurance coverage is based on rainfall rather than yield because forage yields from haying and grazing are difficult to measure.  The intent of the program was to provide funds to producers to purchase replacement feed for livestock so cattle don’t need to be sold.” 

How Pasture, Rangeland, and Forage Insurance PRF is Applied

PRF employs a Rainfall Index to calculate precipitation levels for coverage purposes. For example, an index value of 100 indicates typical precipitation, which is based on a historical average. An index value more than 100 translates into conditions that are wetter than average. A value below 100 shows that conditions are dryer than normal. The Rainfall Index is a proxy for forage production, however, it doesn’t assess direct production or loss. Producers who use PRF are insuring a Rainfall Index, as opposed to their actual production. 

PRF coverage mandates the producer selects a coverage level, a productivity factor, and at least two index intervals. Each index interval constitutes a two-month period. Producers are required to choose two or more non-overlapping intervals. For the purpose of risk management, the intervals chosen should cover the duration when precipitation is most important to a producer’s operation. 

“The index values are published about six weeks after the end of each two-month time period,” says Vandeveer. “If the rainfall index for a given grid triggers an insurance loss for the level of coverage you have purchased, you typically receive a check soon after those index values are announced.” 

Policyholders have the option of selecting a coverage level from 70 percent to 90 percent. The coverage level determines the trigger point for an indemnity payment. Minimal precipitation will bring about an indemnity payment if the final Rainfall Index falls below the coverage level in any of the chosen intervals. The higher the coverage level, the greater the probability of an indemnity payment. 

While the Rainfall Index brings about an indemnity payment, the payment amount is based on several variables:  county base value, productivity factor, coverage level, final Rainfall Index value, and the total number of acres insured. RMA creates a base value for pasture and hay land in each county. In most cases, hay land has a higher base value than pastureland. 

Producers have the option of modifying the base value by choosing a productivity factor that falls between 60 percent and 150 percent. The dollar amount of coverage per acre is equal to the product of the county base value multiplied by the productivity factor multiplied by coverage level. 

It’s important to note that producers are required to distribute a percentage of their total coverage into each of their chosen index intervals. For example, if a producer selects two intervals, they can place 50 percent of coverage in each of the two intervals. They could also place 70 percent in one interval and 30 percent in the other. The percent of coverage in each interval has to add up to 100 percent for the year. 

Advantages of Using PRF 

PRF, while protecting your farm from production hazards having to do with low precipitation, also offers the following benefits that are helpful to farmers: 

  • Record-keeping is not required.
  • You never need to file a claim.
  • You have the option of working with a private crop insurance agent of your choosing.
  • The federal government shares in the cost of actuarially fair insurance premiums.  More than half of the PRF premium cost is subsidized. 
  • You choose the number of eligible acres that you would like to enroll.
  • Indemnity payments are typically made four months after the end of the index interval. 
  • Indemnity payments may help you purchase feed when forage yields are low.
  • If you receive an indemnity payment, the program will issue it automatically.  
  • You do not have to pay your insurance premium when you sign up. You will be billed in September of the following year. 
  • Lenders prefer to see farmers using crop insurance as part of an overall risk management strategy. 

Graybeal Group, Inc. Offers The Widest Range of Products and Pricing in Oregon

Graybeal Group, Inc. is a professional Insurance company with licensed agents and staff.  With over three decades of experience, The Graybeal Group takes pride that our agents are specialized in the needs of our customers in the areas of Crop/Agriculture, Hemp, Non-Profits, Pasture Rangeland and Forage, and Farm & Ranch. 

Being able to provide the time for our agents to focus on their specialty allows us to give you – our clients – the needed coverage for your home and business. At Graybeal Group, Inc., we are committed to providing an experience that empowers our clients so they are educated on their coverage and the value we provide above all others.

For more information, we invite you to call Graybeal Group, Inc. at (541) 567-5523. 

Spring Planting 2021: What’s Ahead for Corn and Soybeans?

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Wondering what crops you should be planting this spring? Plan on seeing higher corn and soybean production in 2021, according to the USDA (United States Department of Agriculture). This year’s planted acres and yield forecast call for a rise in USDA’s initial Grains and Oilseeds Outlook that was recently released. 

Corn production is expected to be 15.2 billion bushels (bb) for the 2021-22 crop, while soybean production is projected to be 4.5 bb. Higher demand forecasts for each of these crops will keep ending stocks comparatively low, that is especially the case for soybeans. 

As you prepare to plant corn and soybeans in the field, we will present you with a summary of some of the indicators and a general outlook for corn and soybeans this year. Hopefully, this will help you starting planting sooner rather than later!

Corn Outlook 

The USDA forecasted the 2021-22 crop year should lead to greater crop production, more domestic use, and exports, as well as somewhat higher ending stocks. 

The 2021-22 corn planting is forecasted to be 92 million acres (ma). With a yield projected at 179.5 bushels per acre (BPA), USDA predicts the corn crop production at 15.2 bb. USDA suggests that the higher yield is based on a weather-adjusted trend, assuming norming planting progress and summer growing-season weather. 

This compares to the previous year’s crop at 90.8 ma planted, a yield of 172 BPA, and production at 14.18 bb. 

The entire corn use for the 2021-22 crop is projected to increase by 3 percent, as well as on higher demand in both domestic uses and continued strength in exports. Additionally, feed, seed, and industrial use are forecasted to rise 4 percent to 6.6 bb. Corn that is used for ethanol is also predicted to rise 5 percent based on expectations of greater motor gasoline consumption over the next year which comes on the heels of a slowdown that occurred as a result of the COVID-19 pandemic.  Feed and residual use for corn in 2021-22 will jump
200 million bushels (MB) to 5.9 bb. 

What’s more, corn exports are anticipated to rise 50 MB to 2.7 bb, “reflecting expectations of global trade growth and continued robust demand from China.” 

Outlook for Soybeans

The USDA anticipates farmers to plant 90 ma of soybeans in 2021, representing an increase of 6.9 ma compared to last year.  The USDA stated that the gain is supported by “new-crop soybean futures prices relative to corn, supported by strong Chinese demand and the tightest stocks-to-use ratio since 2013-14.” 

Soybean production is pegged at 4.5 bb, an increase of 9 percent above 2020-21 production with the yield projected at 50.8 BPA. 

All of this is compared with production for the 2020-21 crop at 4.14 bb and a yield of 50.2 BPA. 

The USDA envisions ending stocks at 145 MB, an increase of 25 MB from its current estimate of 2020-21 ending stocks. Ending stocks to use, at 3.2 percent, is likely to remain historically low. In fact, it is calling for lower exports and higher crush. 

The USDA said, “Soybean crush margins remain relatively strong with soybean and soybean product prices near 2020-21 levels. Soybean meal prices are forecast at $390 per short ton. Domestic use of soybean oil is projected up 2 percent for 2021-22 on expected expansion in renewable diesel capacity and gains in edible oil.” 

Soybean exports are figured to be 2.2 bb, 50 MB less than in 2020-21, as a result of limited exportable supplies that will reduce U.S. market share. 

The season-average farm price is expected to be $11.25 per bu, “up slightly from 2020-21 as forward pricing opportunities for 2021-22 are expected to be higher than a year ago.” 

Will Higher Prices Result in More Acres in Production?

One year ago, it might have been prudent to hold back some acres from production, either because your fields were continuing to recover from flooding in 2019 or you were hedging your bets against the gloomy economic conditions that came as a result of the
COVID-19 pandemic, or both. 

This year, it would seem at least a portion of the acres is returning to production. And if that is the case, you are in good company. We are well-positioned to have the third-highest planted acreage on record, and that is based on the following projections:

  • 91.1 million acres of corn, slightly less than a 1 percent increase from 2020. 
  • 87.6 million acres of soybeans, which is 5 percent higher than in 2020. 

However, as Farm Doc Daily from the University of Illinois notes, the acreage totals in the Prospective Planting report are less than what analysts forecasted. The following circumstances are likely to push more acres into production in 2021:

  • Crop insurance guarantees for corn and soybeans are the highest since all the way back to 2013. 
  • Optimism that export sales will continue to get better, especially with China. 
  • More funding from the Coronavirus Food Assistance program. 

In a reaction to the Prospective Plantings report, corn futures have increased. These indicators could prompt more farmers to bring more acreage into production. However, that may or may not happen, as the USDA releases its revised acreage estimates on June 30 of this year. 

Growers and Producers Are Feeling More Hopeful 

Farmers seem to be quite optimistic about the future. One indication that tells us this is in March 2021, the U.S. Ag Economy Barometer skyrocketed to 177 based on its monthly survey of farmers. The survey asked farmers if they anticipated their farm’s financial performance will be better or worse than a year ago. Considering that the Ag Economy Barometer was a lukewarm 55 in April 2020, it is clear that farmers are going into the planting season feeling quite positive. 

Graybeal Group, Inc. Offers The Widest Range of Products and Pricing

Graybeal Group Inc. is a professional Insurance company with licensed agents and staff.  With over three decades of experience, Graybeal Group takes pride that our agents are specialized in the needs of our customers in the areas of Crop/Agriculture, Hemp, Non-Profits, Pasture Rangeland and Forage, and Farm & Ranch. 

Being able to provide the time for our agents to focus on their specialty allows us to give you – our clients – the needed coverage for your home and business.

For more information, we invite you to call Graybeal Group Inc. at (541) 567-5523. 

Does Homeowners Insurance Cover Floods?

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ADDITIONAL HOMEOWNERS INSURANCE OPTIONS 

There are different “options” or endorsements you may choose to add to your Homeowners Policy here in Oregon. One of the most important extensions of coverage for your home is increasing the limit on Water back up and Sump overflow. Additionally in extension options is Fungus, Wet Rot, Dry Rot, and Bacteria. Normally, policies exclude coverage for the presence, growth, spread of any of these things. 

Water Backup and Sump Overflow

What is the Water Backup and Sump Overflow Endorsement? This endorsement provides coverage for damage resulting from water which backs up through sewers or drains or which overflows from a sump, french drain or sump pump, even if the sump pump fails.

An HO3 Homeowners Policy automatically comes with a $5,000 limit for these instances; However, we find that typically isn’t enough. Here at Graybeal Group, every Policy that we write includes a Water Backup and Sump Overflow Endorsement, increasing your limit/coverage to $10,000.

Why should I add this Endorsement?

Depending on the location and age of your home, oftentimes when sewer pipes age and fail it can cause water to reverse course and flow back into your drain, causing damage. Alternatively, sump pumps can fail or become inundated with water from a storm run off, resulting in a damaged foundation or flooded basement.

Water backup can create costly damage to drywall, floors, floor coverings, furniture, personal items, curtains, etc. In the event of this type of claim, we want to ensure that you are not having to pay out of pocket for water remediation.

flood insurance graybeal group

Loss of Use Coverage

Sump failure typically doesn’t make your home unlivable – in other words, despite the damage, you are still able to live in your home while repairs and cleaning take place. However, in the rare occasion that the damage is too extensive and it makes your home uninhabitable, having water backup coverage would qualify you for Loss of Use coverage.

For example:

A storm flooded your basement, causing water damage to your furnace. It is 27 degrees outside and you are unable to heat your home. Now is a bad time to search for flood insurance, or additional homeowners insurance options.

Loss of Use covers additional living expenses, above and beyond a person’s normal living expenses, as well as loss of rent, if that’s the case. If approved by your claims adjuster, this coverage would allow you to occupy a hotel that is paid for by your insurance until the home becomes livable.

How to best prevent water backups

  • Restrain from pouring cooking grease or oils down your drain.
  • Don’t flush paper towels, feminine products, etc.
  • Check your Sump Pump regularly and look for pre-existing drainage issues.
  • If you live in an older home, install a backwater prevention valve.

Fungus, Wet Rot, Dry Rot, and Bacteria

The limits listed are the aggregate limit. Meaning, that limit is the max amount that the insurance company will pay out during a policy period – regardless of how many claims are made, the number of additional locations insured under this endorsement, or the number of occurrences.

Section I Property Coverage limit of liability for the Additional Coverage Fungi, Wet Rot, Dry Rot, or Bacteria $10,000
Section II Coverage E aggregate sub-limit of liability (damages others) for Fungi, Wet Rot, Dry Rot, or Bacteria $50,000

 

Fungi is classified as any type or form of fungus, including mold or mildew, and any mycotoxins, spores, scents or by-products produced or released by fungi. 

What is covered if fungi, wet/dry rot or bacteria is found? 

Often times there is extensive damage that is unseen. When filing a claim for fungi, wet/dry rot or bacteria damage, the cost of removal is covered. Additionally covered, is the cost to tear out and replace any part of the building or other covered property as needed to gain access to the fungi, wet/dry rot, or bacteria.

The cost of testing for air quality or property to confirm the absence, presence or level of fungi, wet/dry rot or bacteria may be provided only to the extent that there is a reason to believe that there is the presence of any of it. This testing may be performed prior to, during or after removal, repair, restoration, or replacement. 

Loss payable Section I- Property Coverage

Things to be aware of with this endorsement: the coverage only applies when such loss or costs are a result of a peril insured against and only if all reasonable means were used to save and preserve the property from further damage at and after the time of loss. Also, if there is a constant or repeated seepage or leakage of water or the presence or condensation of humidity, moisture or vapor, over a period of weeks, months or years unless such seepage or leakage and the resulting damage is unknown to all insureds and is hidden within walls, ceilings, or under floors.

For more resources regarding home flood insurance!

Graybeal Group, Inc. Offers A Wide Range of Products and Pricing

Graybeal Group, Inc. is a professional Insurance company with licensed agents and staff.  With over three decades of experience, The Graybeal Group takes pride that our agents are specialized in the needs of our customers in the areas of Crop/Agriculture, Hemp, Non-Profits, Pasture Rangeland and Forage, and Farm & Ranch.

Being able to provide the time for our agents to focus on their specialty allows us to give you – our clients – the needed coverage for your home and business. At Graybeal Group, Inc., we are committed to providing an experience that empowers our clients so they are educated on their coverage and the value we provide above all others.

For more information, we invite you to call Graybeal Group, Inc. at (541) 567-5523.

What Does Homeowners Insurance Cover? Protect Your Home Inside and Out.

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Homeowners Insurance: What is it and how am I covered?

Does my homeowners insurance cover this? The question that many insurance agents receive every day from their customers. In the next few paragraphs we are going to provide a quick overview of what your Homeowners Insurance Policy covers, and what may be excluded. 

There are four parts to your homeowner’s policy.

    1. Coverage A- Dwelling
    2. Coverage B- Other Structures
    3. Coverage C- Personal Property
    4. Coverage D- Loss of Use.
COVERAGE A- Dwelling

Dwelling coverage provides coverage for the physical home itself. Coverage A can also provide coverage for supplies and materials that are used in construction, repair, or to alter the dwelling and/or other structures located on the insured’s premises, these materials must be located on or next to the premises.

COVERAGE B- Other Structures

Other structures on the insured’s premises that are apart from the main dwelling, defined by a clear space between – ei: shop, shed, barn, or free standing garage. If the structure is attached to the main dwelling via utility line or fence, etc it’s considered detached and will be covered under Coverage B. You may wonder what is my limit and how is it calculated? Other Structures limit is 10% of your Coverage A (Dwelling) limit. In other words, if your Dwelling(Coverage A) is insured at $300K, your Other Structures (Coverage B) limit would be $30k.

Coverage A: $300,000.00 x 10% = Coverage B $30,000.00

There are exclusions for Coverage B and it is important to understand what they are. If you are unsure if your property may not be covered, ask your agent. If your “Other Structures” are being used for business purposes, being rented or held for rent to someone who does not reside in your home, coverage on this structure is excluded. One exception is if the structure is being used as a private garage only. If it’s being used as a private garage only, the renter does not have to reside on the premises for this “other structure” to be covered. 

COVERAGE C- Personal Property

Personal Property can cover your property while being physically at your home or anywhere in the world. Personal Property can range from furniture, electronics and clothing, camping gear and at times the property of a house guest if applied to your policy upon issue. This type of coverage helps pay to repair or replace your belongings after a covered loss, such as theft or fire.

The limit of coverage for Personal Property is 50% of your Dwelling limit (Coverage A). If your Dwelling limit(Coverage A) is $300K, your Personal Property limit (Coverage C) is $150K. 

Coverage A: $300,000.00 x 50% = Coverage C $150,000.00

Personal property away from the premises coverage limit is 10% or $1,000.00 of your Dwelling (Coverage A), whichever is more. Coverage away from the premise is strictly for the insured’s property, this does not apply to guests.  

In your homeowners’ policy, there are special limits of insurance. In other words, maximum limits that are designated for certain items. 

See table below: 

Maximum Limit of Coverage Amount   Items included 
$2500 Business personal property at the residence
$1500 Personal records, deeds, securities, passports, stamps, letters of credit, notes (other than bank notes), accounts, proofs of debt, tickets, and manuscripts. Also included is the cost to replace, research, or restore the lost/damaged information
$1500 Trailers not used with watercraft
$1500 Watercraft, including trailers, equipment, and outboard motors (an outboard motor is a propulsion system for boats, consisting of a self-contained unit that includes engine, gearbox and propeller or jet drive, designed to be affixed to the outside of the transom)
$1500 Electronic apparatus while in, on, or away from a motor vehicle, as long as it can be operated from the motor vehicle power source and retains its ability to be operated from a power source other than the motor vehicle. Includes tapes, wires, disks, records, and other media 
$500 Business property away from the insured premises
$200 Bank notes, money, gold (not goldware), silver (not silverware), coins, platinum, medals, and bullion (Bullion is gold, silver, or other precious metals in the form of bars or ingots.

 

There are also types of property that are subject to a max amount of coverage if they are stolen. See table below for those items and their max coverage amounts.

Maximum amount of coverage Type of Property
$2500 Firearms
$2500 Gold-ware, Silverware, and Pewter-ware
$1500 Furs, watches, jewelry, precious and semi-precious stones

Jewelry, Firearms, Antiques, or my Watercraft Trailer… Is this covered? In continuance of your Homeowners’ Policy’s Personal Property section, you have the option to have Scheduled vs Non-Scheduled property. Scheduled Personal Property can be a great benefit for those who have higher amounts of assets. Scheduled personal property is a supplemental insurance policy that extends coverage beyond the standard protection provided in a homeowners’ insurance policy. By purchasing a scheduled personal property policy, owners can ensure full coverage of expensive items, such as jewelry or firearms, in the event of a claim.

For example,  Steve has a Non-Scheduled policy and has a collection of firearms amounting to a retail total of $7,200. In the event that his home was broken into and all firearms were stolen, only $2,500 of this property would be covered/paid out. If Steve had Scheduled this Personal Property, these items would be covered and replace on a Replacement Cost valuation. (The limit you insured each item for)

COVERAGE D- Loss of Use

What exactly does this mean? Loss of use coverage is applicable when a residence or dwelling becomes uninhabitable due to damage that has been caused by a covered cause of loss. 

There are few different scenarios that would cause this coverage to kick in: 

1) Cost of Living Expenses: If the dwelling suffers a covered loss and is uninhabitable, the insurance company will reimburse the insured for the (necessary) increased cost of living expenses to keep a normal standard of living – while the property is being restored/repaired. This is referred to as Additional Living Expense. 

2) Fair Rental Value: If the loss occurred on the part of the residence premises that is rented out to others, the insurance company will pay the fair rental value while the building is repaired. Payments will be for the shortest time to repair/replace. 

Lastly, if civil authority doesn’t allow you to access your dwelling/premises because of damage to a neighboring dwelling, the insurance company will pay Fair Rental Value or Additional Living Expenses for up to two weeks. 

Understand your insurance and what it covers! Let our team of experts at Graybeal Group Inc. review your current coverage and create an Insurance Protection Plan that’s suited just for you at a price you can afford!

If you have any questions or would like further explanation, call our office at 541-567-5523, or email our Lead – Home and Auto Agent  Ana@graybealgroup.com

5 Rules Every Rental Property Landlord Should Live By

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specialty dwelling insurance Hermiston OR

I’m pretty confident that if you asked anyone who has ever owned a rental property you would get an overwhelming response that it’s not as lucrative or easy as they thought it would be. In fact, owning a rental property can be a major pain, and end up costing you a ton of money!

I certainly don’t mean to be a “Debbie Downer”, and I know that if it’s done right it can be lucrative, but from an insurance agent’s perspective, I don’t see a lot of people doing it right.

So you’re probably thinking, “Well Chris, you are an insurance agent. What do you know about real estate or rental properties? Why should I take advice from you?”

I’m not a real estate agent, and I don’t own a rental property. However, several of my friends/family/clients/co-workers own rentals, and because I insure a bunch of their properties, I’ve had a first-hand account of the process, and I’ve learned what to do, and what not to do.

1.) Do your due diligence on the rental property

This is undoubtedly the biggest mistake I see landlords make. They are in such a rush to make money, they don’t pay enough attention to the property. I get it–you want to buy the cheapest property possible so you can turn the biggest profit. The problem with that is, the property is cheap for a reason. It has problems–lots of problems.

Many people buy properties in low income areas, with hopes of re-painting the walls every 5 years and making some rent money. The problem is, that’s the exact type of property that insurance companies don’t want to take a risk on.

Be very careful with the “as-is” property too. Unless you have money to burn, stay away. You are almost always going to spend more money than you think. Most “as-is” properties are either forecloser’s or properties that have been vacant/abandoned.

If you don’t know what to look for in a rental, hire a trusted 3rd party home inspector and make sure everything, and I mean everything checks out. Don’t leave any stone unturned.

Everything must be up to code before you have a tenant in the house. Period. If it’s not, make it up to code.

In particular, you need to make sure the wiring, plumbing, heating, and roof are all “problem-free”, and that they’ve been upgraded or updated within the past 10 years. I’ve seen more problems with those three things than anything else, and you are putting yourself (lawsuit), and your tenant at risk if they aren’t in good working condition.

And whatever you do, make sure there are no mold problems. Don’t just assume there isn’t. You need to test the house and document it. Mold can kill–literally.

Of course, you may want to walk away from a property because it might be cost-prohibitive to bring everything up to code, and that’s something that only you can decide, but before you buy a rental property and put get a tenant, do your due diligence on the home.

It’s worth the time and effort.

2.) Have written contracts in place

Find a lawyer and pay his/her fee. Trust me it’s worth it. You can’t just tell your tenant, “You break it, you buy it”. You need to have a written rental contract and lease in place.

If at all possible, don’t sign less than a 12-month lease, and make sure your tenant thoroughly understands the terms of the contract. Don’t be lazy and just have them sign it without explaining everything first.

You can save yourself a lot of time, money, and hassle if you do this, and it will show the tenant that you are serious and that they will be held accountable for the property.

rental property insurance

3.) Thoroughly screen your tenants

Rarely have I seen someone screen their tenant(s). Most landlords are so worried about getting someone in the property to pay rent, that they fail to check the people/person out.

At the very least, you need to make sure your tenant is carrying their own renter’s insurance (HO4 policy). Let the tenant know that your insurance doesn’t cover them whatsoever.

Really what you should be doing is checking their credit and also checking for any criminal activity. These are reports that cost very little upfront and will give you great peace of mind knowing that you have a trustworthy, reliable tenant.

Whether you allow pets and/or smoking is up to you, but I’d be careful with both, because, in the end, they could cost you money if you have to repaint, replace carpeting, etc. They could also potentially result in liability exposure with dog bites, and house fires.

4.) Make sure you have rental property insurance

Having the correct type of insurance for your rental property is paramount. The problem is, most people don’t know that they need a certain type of policy.

You can not buy traditional homeowners insurance for a rental property. What you need is called a “Dwelling Fire” policy, or sometimes it’s referred to as a “Landlord” policy.

Keep in mind that the underwriting for rental properties is generally a little tighter, and the coverage isn’t as broad as what you would find in a traditional homeowners policy. As I mentioned before, many people buy properties in low-income areas, with hopes of re-painting the walls every 5 years and making some rent money.

The problem is, that’s the exact type of property that insurance companies don’t want to take a risk on.

Still, you must buy this type of policy for a rental. Do not buy regular homeowners insurance because it is not designed to insure a non-owner-occupied home, and your claim would almost certainly be denied if you had the wrong policy.

Another thing you need to be aware of is that most Dwelling Fire/Landlord policies state that if a property is vacant/un-rented for more than 30 consecutive days (with some companies it’s 60 days), coverage can be severely reduced and even eliminated, so make sure if it’s a rental property, don’t let it sit vacant too long.

If you think it will be vacant for more than 30-60 days, you need to let your insurance carrier know that, because that situation would most likely call for a different type of Dwelling Fire policy.

5.) Keep tabs on your rental property

I’ve had people call me for quotes for their rental properties, and when I begin to probe them on the construction information, they know absolutely nothing about the house.

Some people don’t know whether the house is brick, siding, or what it’s made of. They don’t know how old the roof is, or the last time the heating was updated.

Folks, if you own a rental property, you need to know all of these things.

I had someone one time who had purchased a home from a contractor who had flipped it and hadn’t even seen the house once. He bought it on the word of the contractor and knew nothing about it except that he wanted to rent it out as soon as possible. That is well, not very smart. You shouldn’t be trying to get insurance on a house you haven’t seen yet.

You need to keep tabs on your property.

Keep records of all repairs, and make sure you physically visit or at least drive by the property every 3-6 months or so to make sure everything is in good working order. Remember, this is an investment. You need to maintain and take care of the property just as if it was your primary residence.

Owning a rental property can be a lucrative business that can generate a lot of passive income, however, if you don’t abide by these 5 rules, it could end up being a royal pain, and cost you a lot of money in the process.

 

Graybeal Group, Inc. Offers A Wide Range of Products and Pricing

Graybeal Group Inc. is a professional Insurance company with licensed agents and staff.  With over three decades of experience, Graybeal Group takes pride that our agents are specialized in the needs of our customers in the areas of Crop/Agriculture, Hemp, Non-Profits, Pasture Rangeland and Forage, and Farm & Ranch. 

Being able to provide the time for our agents to focus on their specialty allows us to give you – our clients – the needed coverage for your home and business.

For more information, we invite you to call Graybeal Group Inc. at (541) 567-5523.