FAQs

Frequently Asked Questions

Business Insurance FAQ

Q: What is General Liability Insurance?
A: General Liability provides coverage for incidences that you are liable for such products that your company manufactures or sells, damages to individuals arising from your premises and also covers general operations both ongoing and after completion.

Q: Is it OK for others to drive my business vehicle?
A: It is OK for other individuals to drive your vehicles with your permission, however, if an individual used said vehicle often they need to be listed on your policy.

Q: Insurance for sub-contractors, do I really need the certificate?
A: Yes, if you are audited you may be required to have proof that your sub-contractors have their own coverage. By having the certificate, you can prevent charges for incidences that happen to the sub-contractors.

Q: What is the difference between Actual Cash Value (ACV) and Replacement Cost (RC)?
A: This type of coverage refers to the liability coverage to help pay for damages that are incurred via your operation or products, after the point that you have no control over them.

Q: What does Products/Completed Operations mean?
A: This type of coverage refers to the liability coverage to help pay for damages that are incurred via your operation or products, after the point that you have no control over them.

Q: What does 80% co-insurance mean?
A: This is the way the insurance company encourages all insured to adequately insure their property in relation to other insured. Insurance carriers require that an insured party cover at least 80% of the property’s value in order to collect a partial loss in full.

Q: What is Business Interruption/Extra Expense coverage?
A: During repairs due to damages related to a fire or compensable loss, Business Interruption/Extra Expense coverage provides coverage for income loss and the expense of establishing a temporary site.

Q: How does an audit work?
A: At the end of the policy term, the insurance company will review the policy and either charge or credit the policyholder based upon an audit of estimated figures. Examples of estimated auditable items include payroll and sales. Audits can be performed or via mail or telephone or onsite by an auditor. A premium is charged for audit estimations.

.

Home Insurance FAQs

Q: What Personal Property Insurance?
A: Personal Property coverage is included in a standard home insurance policy and protects your personal items and household contents in the event they are stolen or destroyed by fire, hurricane or other peril covered in your policy.

Q: What is MedPay?
A: MedPay (or Medical Payment) is coverage that helps cover medical expenses that you might be held responsible for due to an injury sustained on your property when there is no lawsuit.

Q: What is Dwelling Coverage?
A: This portion of your policy pays to replace the structural components of your home. This protects against the damage and possible loss of your home’s structure in the event of a covered claim such as a hurricane, hail, lightening or fire. (Separate policies are needed for flood and earthquake insurance).

Q: What is Persona Liability Protection?
A: Personal Liability Protection: This covers you in the event that a lawsuit is presented against you or covered family members for bodily injury or property damage. Your pets are also included in this portion of your policy protecting you against bodily harm or property damage that they may cause to others.

Q: What is Loss of Use Coverage?
A: This type of coverage provides for your living expenses in the event that you cannot live in your home due to a covered claim. It typically covers hotel and restaurant bills and other living expenses you may incur while your home is being repaired.

Q: When should I review my home insurance policy?
A: It is recommended to review your home insurance policy twice a year. However, you should also review your policy whenever one of the following situations occurs:

  1. When the homeowners policy comes up for renewal. Has my home insurance provider made any changes to my coverage?
  2. When you make major purchases or alterations to the home. This can be anything from a newly added room or purchase of adjoining lot.
  3. Anytime you have change of circumstances. This could be financial or life style change related but never be afraid to ask questions. It is your home and you need to protect it and yourself as well.
  4. When you’ve made your house safer. You need to review you policy when you do any major repairs or major weatherizing to your home.

Life Insurance FAQs

Q: How much is “enough” when it comes to life insurance?
A: Most experts will tell you that between 6 and 8 times your annual earnings is an ample amount. There are other factors though that should be considered when trying to determine as this amount as closely as possible.
Some factors to consider include:
  • Various sources of income not including your salary/earnings
  • Your marriage status and your spouse’s earning capacity
  • How many financial dependents you may have
  • Whether you can expect death benefits Social Security and/or from life insurance plan sponsored by your employer
  • If you will need to provide coverage for any special circumstances including estate planning, an education fund, mortgage repayment, etc.

Always speak to your insurance advisor who can help determine a more precise calculation on the amount of life insurance you might need.


Q:Should I purchase life insurance on my spouse and/or children?A:While you may consider doing so in some cases, typically it is more important to concentrate life insurance needs on the individual who provides the main income for the household. This is the main focus before considering additional coverage for other family members. In the case of a dual income household, it would certainly be of benefit to provide life insurance coverage for both spouses.


Q:Is there any need for term insurance or cash value life insurance?A:

When you are making a decision on purchasing life insurance you must answer two basic questions:

  • “How much do I need?” and
  • “What type of policy should I purchase?”

These two questions actually involve two separate types of decisions – an insurance decision and a financial decision.

You should always strive to answer the “insurance” question first. An example of this may be the case in which you need such a large amount of coverage that you will need to select term life so that you can take advantage of the lower premium.

The financial decision will cover factors such as your tax bracket, whether you need short or long term coverage, and rates of return.


Q:Can I use my life insurance policy to repay my outstanding mortgage loan?A:Typically, you can use your existing insurance policy for many different needs including paying of a mortgage in case of death of the insured.Another type, credit life insurance, is sometimes recommended when selecting an installment loan for purchasing new vehicles or expensive appliances or even in the case of debt consolidation. This raises a question: is credit life insurance a smart buy?Credit life insurance almost always more spendy than term life insurance. Also, if you already have sufficient coverage through your regular policy, it is usually not advised because of its relatively high cost.

 

Auto Insurance FAQs
Q: What type of auto insurance coverage should I purchase?
A: Your agent can help you to know various things you must consider when deciding on the right auto insurance policy. Some of these include:

  • Selecting the right provider.
  • Knowing the correct amount of liability coverage that will offer you proper protection.
  • Choose any additional coverage you may need or desire.
  • Helping to keep you informed on other factors such as claim response and customer service.

Q: Is my non-insured family member or friend covered if they borrow my vehicle?
A: No worries, when you lend your car you can rest assured that the driver will be covered since the policy typically covers the vehicle rather than the driver.

Q: Can you explain comprehensive physical damage coverage?
A: Comprehensive coverage covers direct physical damage. This could be due to something such as storm damage, etc.

Q: Can you explain collision physical damage coverage?
A: Collision coverage takes care of damage that is incurred through a collision between your car and another object or vehicle.

Q: Is there any way to get a lower auto insurance rate?
A: There are actually many things that you can do to get a lower rate.The first is to always seek out competitive pricing. This is where working with a company like The Hoffman Agency, LLC, is of great benefit. We are able to work with different carriers and help find you the rates you are looking for while also insuring that you have the best coverage possible. Another way that you might get a lower overall rate would involve raising your deductible. Typically the higher your deductible, the lower your rate. Keep in mind though that if you have a claim you will be responsible for paying the deductible.