We’ve all seen the impact of inflation on energy costs, at the grocery store and now on your home and auto insurance. Although inflation seems to be settling, the impacts will be felt for years to come. With that being said, we’d like to provide you with some factors as to why you’re seeing such an impact to your home and auto insurance premiums.
Shortage of workers: The Home Builders Association estimates the number of hired construction workers needed to keep up with demand in 2023 will need to be 740,000, with an additional 2.2 million needed by 2024. This is also causing a spike in labor as contractors are paying more to attract talent.
Material costs: Costs are up 12% vs. 2022 and 40% since February 2020.
Safety Codes & Local Ordinance: Your homeowners policy provides coverage to bring out of date items up to code after a covered loss. Homes are rebuilt to current code to ensure the safety for you and your loved ones.
Loss of use: When you’re involved in a claim and unable to live in your home during construction, coverage that will pay for replacement living and rents are at an all time high.
Auto Inflation
Manufacturing time delays brought on by the pandemic have led to increased costs for parts, labor and rental vehicles. Below are a few statistics that have impacted auto premiums:
Technology: Cameras and sensors keep us safe and there’s an additional cost to ensure they are working properly after a collision. Some vehicles now have over 30 devices built into the car.
Parts: The average increase for parts was 10% in 2022, where in years past the average is typically 2 to 3%.
Supply Chain Issues: The delay in parts being available has increased the repair times by 5 days.
Replacement Vehicle Costs: Rental car costs have increased 30% since 2020.
Labor shortages: A decline in available skilled auto technicians has been declining and the industry is facing over 100,000 retirements in the coming years.
Rest assured, we’re here to provide assistance. There are opportunities for savings such as: bundling your auto and home insurance, raising your policy deductible, or capitalizing on discounts by implementing preventive measures like installing an automatic water shut-off or temperature monitoring system, to mention a few. Please contact us if you’d like to review your account further.
It’s not something anyone likes to think about, but life-altering illnesses and injuries happen every day. We wouldn’t be able to get out of bed in the morning if we fixated on all the ways we could hurt ourselves.
In fact, just over one-in-four of today’s 20-year-olds will find themselves unable to work at some point during their career because of an illness or injury.1
On top of that, there are also lots of ways to die prematurely — many overlapping with ways to become injured or disabled. Any of these scenarios can have significant financial impacts on you or your family.
But there are ways to help protect against such circumstances.
To illustrate, consider the following hypothetical examples based on the experiences of real, everyday people. One illustrates how life insurance can help provide protection for your family should something unexpected happen to you. The other shows how disability income insurance can help with income needs should an illness or injury prevent you from working.
Life insurance
One ordinary day, Erica came home from work to find her husband Blake unconscious on the kitchen floor. She couldn’t wake him up. An autopsy would reveal that he’d had a brain aneurism that morning and died instantly. He was in his 40s with no health problems. He left behind two daughters and his wife — his high school sweetheart.
Fortunately, Blake had a life insurance policy to provide for his family.
Giving loved ones a way to cope with situations like Erica’s is a compelling reason to buy life insurance. Term policies are typically inexpensive, especially if you’re young and healthy.
Permanent life insurance policies are more expensive, but they provide coverage for as long as you live for a steady premium, whereas term policies typically are designed for shorter time frames. In addition, they build cash value over time, making them an option for funds in later years.
Long-term disability income insurance
A disability can affect your mind, body, or both. And it can affect your ability to earn a living: your most valuable financial asset.
Financially, a long-term disability or illness can have a greater financial impact than premature death. You still have living expenses, but you also have increased health care expenses—without any way to make money to pay for them.
Xavier was a young doctor when he learned he had a rare and aggressive form of cancer—and it was already in stage 4. He had to put his plans on hold and immediately enter treatment. Few people Xavier’s age have the foresight to purchase disability income insurance or even know it exists. But Xavier did, because a fellow doctor recommended it. Adding insult to injury, those benefits could be taxable, whereas a private policy’s benefits would not be, assuming Xavier had paid the premiums out of his take-home pay.
Conclusion
A financial professional can provide you with quotes and different policy options tailored to your circumstances. Both types of insurance are cheaper when you’re younger. You’ll be paying premiums for more years, but you’re more likely to be insurable and get coverage when it’s most affordable. We all like to think that serious illness, disability, and premature death won’t ever happen to us or to our loved ones. But one way to make the possibility less scary is to buy the right insurance. Knowing that you’ll have the financial support you need in a challenging time will make life’s uncertainties and misfortunes less difficult to endure.
http://www.clearyinsurance.com/wp-content/uploads/Cleary_Logo.jpg00Carol LaCombehttp://www.clearyinsurance.com/wp-content/uploads/Cleary_Logo.jpgCarol LaCombe2023-04-11 15:04:392023-04-11 15:04:40Why you Need Both Life and Disability Insurance
Global, national, and local economies have changed dramatically in recent years as a result of the pandemic, global conflicts, and other factors. The war in Ukraine has resulted in higher fuel costs, which contributes to rising supply and transportation costs. Financing costs are also increasing as central banking systems, such as the U.S. Federal Reserve, raise interest rates. Businesses are also confronting supply chain disruptions, worker shortages, sustained inflation, and other challenges.
Increased risks from natural catastrophes
Businesses also face increased risks from severe weather and natural catastrophes caused by climate change — including wildfires, drought/heat waves, tornadoes, hurricanes, and flooding. In 2020, the U.S. saw a record 22 weather-related disasters that each caused more than $1 billion in damage, and together resulted in approximately $95 billion in losses.1 2021 saw 20 such events with a total of more than $145 billion in damages. 2
Factors contributing to inflation
With multiple economic forces converging, the market is experiencing marked increases in the value — and the rebuilding and replacement costs — of commercial property, including buildings, fixtures, and equipment. Given this situation, now is the time to assess the value of your business property and review your insurance coverage. Notable trends that are continuing to drive inflation and raise commercial property valuations and insurance costs include:
Decreased supplies
Increased demand
Tightening labor market
Property valuation changes and insurance limits
The replacement value of a building is not its market value or what it’s worth in the current real estate market. It is the cost you will incur to rebuild or replace the property with materials of like kind and quality. Because construction costs — including rebuilding costs — have gone up, the cost to repair or replace your building has increased as well.
Furthermore, supply and labor shortages can delay construction projects. If your business needs to rebuild following a fire or other disaster, it may take extra time to reopen facilities and drive up business interruption losses. Delays can add to additional costs—for instance, if you must lease temporary office or warehouse space.
Similarly, supply chain disruptions, labor costs, and other market forces may drive up the costs of equipment and goods specific to your business. When reappraising the replacement cost of your buildings, you may want to consider the replacement costs of equipment and stock that are essential to your business.
Higher property valuation will likely require you to increase the limits of your insurance coverage, resulting in premium increases – but it will also provide peace of mind knowing that, in the event of a catastrophic loss, your business has proper coverage.
Start a conversation with your broker or agent
Insurers are seeing higher claims costs because of increases in constructions costs and the frequency and severity of losses. Together, these factors may result in higher premiums for your commercial property coverage.
Consider reaching out to us to review your commercial property insurance, as well as the stability and track record of your insurer. You may want to discuss conducting a new appraisal of the replacement value of your facilities, equipment, and stock. Look at options for raising your policy limits to adequately cover the increased costs of replacing business assets and keeping your business afloat if your operations are disrupted.
Click here to read the Chubb article in more detail.
This document is advisory in nature and is offered as a resource to be used together with your professional insurance advisors in maintaining a loss prevention program. It is an overview only, and is not intended as a substitute for consultation with your insurance broker, or for legal, engineering or other professional advice.
Chubb is the marketing name used to refer to subsidiaries of Chubb Limited providing insurance and related services. For a list of these subsidiaries, please visit our website at www.chubb.com. Insurance provided by ACE American Insurance Company and its U.S. based Chubb underwriting company affiliates. All products may not be available in all states. This communication contains product summaries only. Coverage is subject to the language of the policies as actually issued. Surplus lines insurance sold only through licensed surplus lines producers. Chubb, 202 Hall’s Mill Road, Whitehouse Station, NJ 08889-1600.
http://www.clearyinsurance.com/wp-content/uploads/Cleary_Logo.jpg00Carol LaCombehttp://www.clearyinsurance.com/wp-content/uploads/Cleary_Logo.jpgCarol LaCombe2023-04-11 14:57:412023-04-12 11:19:24Commercial Property and Inflation
https://www.clearyinsurance.com/wp-content/uploads/cardiac-arrest.jpg183276Carol LaCombehttp://www.clearyinsurance.com/wp-content/uploads/Cleary_Logo.jpgCarol LaCombe2023-01-26 11:52:492023-01-26 11:52:49A primer on cardiac arrest
You’ve hired a reputable builder, collected paint swatches and selected the siding and now you’re finally ready to start that long-awaited remodeling project. Before you begin construction, there is one more thing that you need to do—talk to Cleary Insurance, Inc.!
Advice for Do-it-yourselfers
If you decide to do it alone and manage a renovation yourself, you assume all the risks. A review of your homeowners coverage for liability and property is prudent, as you are assuming more risks and exposures than contemplated by homeowners insurance.
Hiring subcontractors who can provide you with a “Certificate of Insurance” or copies of their policies showing their general liability and workers’ compensation coverage is mandatory for your legal protection.
If a friend or relative helps out as a favor—no money changes hands—and gets injured, your homeowners insurance typically covers the cost of their injuries, up to your policy limits. It’s important to note that a homeowners policy is not designed to provide primary liability protection for these injuries. If a helper is seriously injured, the domino effect can be financially and emotionally difficult for all who are involved. For an extra layer of protection, it’s a good idea to also carry umbrella liability coverage, which kicks in to provide liability coverage above your homeowners limits.
Insuring the Real Value of Your Home
Experts estimate that one-fourth of remodeling projects add at least 25 percent to the value of a home, yet often most homeowners forget to increase their coverage to protect their investment. Most homeowners insurance policies require 100 percent of the home’s replacement cost, so it’s important to raise your home’s policy limit before your project begins.
The Basics
When undertaking a remodeling project, people often forget to review their insurance needs, too. Whether your addition budget is large or small, you are adding both the value of your home and your exposure to risk. To ensure that your project goes smoothly and that you have the coverage you need, here’s what you need to know.
Working with General Contractors
The best way to minimize your renovation risk is to hire a reputable general contractor for the job. As part of the bidding process, ask the general contractor to provide a Certificate of Insurance and/or copies of the policies. Specifically, check for coverage for the following:
Workers’ compensation: Verify that he or she has workers’ compensation coverage in the event that an employee or subcontractor gets hurt on the job.
General liability: Ask if the contractor has liability insurance, which covers losses due to negligence and errors or omission, which results in property damage. Also, ask that you are added as an “additional insured.”
Builders risk: This policy is designed to cover damage to your home and materials, including those not installed yet. We can help you verify whether you should require this from your contractor, based on your renovation project. If they don’t carry the proper coverage, they are not the right contractor for the job!
Your Insurance Partner Adding to your home is exciting, but poses financial risks. Contact Cleary Insurance, Inc. at 617-723-0700 to learn more about all of our home, auto and life personal risk management solutions.
http://www.clearyinsurance.com/wp-content/uploads/Cleary_Logo.jpg00Carol LaCombehttp://www.clearyinsurance.com/wp-content/uploads/Cleary_Logo.jpgCarol LaCombe2022-11-01 13:59:282022-11-02 09:13:00Home Remodeling and Insurance
This fall our client focus is on George and Margaret Greene. George and Margaret moved to the North Shore of Boston from England in 2010. Prior to moving here, they raised their family in Hong Kong where George taught at the university for 38 years.
During trips back to Hong Kong they stayed in a guest house on campus where they met a young Kenyan and learned about his project to give girls in his county a chance at a high school education.
In Kenya, the government provides an education through the eighth grade. Once through the eighth grade, many are left in a perilous situation where they might be married off or worse. Many will never get out of their village.
George and Margaret visited Kenya on two occasions and set up the Evergreen Initiative to support as many young girls as possible to receive an education and escape the future that awaits them.
This is a true grass roots effort. Every dollar they raise gets to the girls. To put a girl through a year of school, approximately $750 to $1,000 is needed depending on the transportation costs of the bus. This money covers tuition, books, uniform, shoes, hygiene products and transportation to school.
Below please meet Irish and Beatrice, who will be High School seniors in January 2023. They are two of 4 girls currently being supported by Evergreen Initiative. If you would like to support this effort and girls such as Yvonne, please send Margaret an email at margaretgreene166@hotmail.com.
IrishBeatrice
http://www.clearyinsurance.com/wp-content/uploads/Cleary_Logo.jpg00Carol LaCombehttp://www.clearyinsurance.com/wp-content/uploads/Cleary_Logo.jpgCarol LaCombe2022-11-01 13:38:392022-11-01 15:06:58Client Spotlight: George and Margaret Green
The journey to financial independence and wellness starts with saving. But for many people, that can be a challenge, especially in trying economic times.
But there are strategies and mechanisms that can help you get on track for retirement.
If you are not currently saving … start
For people in their younger years, starting a retirement savings plan can be the biggest challenge, but also the most important step toward ensuring financial security and well-being in the future, even if that future seems far off.
Why can it be a challenge? Often, those just starting out in their career and working life are saddled with a large amount of student loan debt. That presents a question about whether it’s better to direct resources to paying off debt or start building a nest egg for retirement. The answer will be different depending on individual circumstances, but will probably lie somewhere in the middle.
Those starting out also likely face lower paychecks than those whose experience have allowed them to command a higher salary. Amid living expenses and day-to-day demands, setting aside money for retirement savings can seem like less of a priority.
Which is a mistake. For one thing, many employers offer incentives for company-sponsored retirement savings programs, typically matching a certain percentage of contributions. Not taking advantage of such saving plans amounts to essentially turning down a pay raise. Also, starting a savings program, especially in early years, takes better advantage of compounding interest over time.
That math can help those starting a savings program in later years, too.
If you think you can’t afford to save, you may want to look at moves to improve your financial wellness and allow at least some funds to go into a savings program. These steps include:
Creating a budget. This is central to getting a handle on your personal finances. It will also likely identify areas where cutbacks may be possible in order to direct some money to savings.
Learning to manage debt. This is the area that trips up many people. Credit cards can lead consumers to rack up more in obligations than is necessary or wise. On the other hand, some types of debt are necessary. Understanding the kind of debt you have and having a plan to tackle it is a positive step.
Managing student loans. For those starting out, student loans may be a part of the debt load. Beyond setting an overall debt plan, investigate the specific options available to you for student loan debt.
Those already saving may still want to take a couple of steps to make sure they are on course to meet their retirement goals.
First and foremost, make sure you are on track. This will help you gauge how your savings are stacking up against your likely needs.
If you are falling behind, you may consider ways to save more, especially if you still have a number of years until your likely retirement. Since many people have some portion of their paycheck deposited directly to a retirement savings account, some simply try increasing that percentage.
Additionally, you may want to do some retirement savings account housekeeping. This can include checking to be sure your beneficiaries are current and taking steps to make sure you are always current on your account status. But, perhaps more importantly, it also includes making sure your investment asset allocation is correct for your age and risk tolerance.
If you are approaching retirement … double check
Estimates vary as to how much in savings you should have to maintain your current standard of living in retirement. They typically range from six to nine times your annual income and can be affected many factors, like geography and market conditions.
If you find that you are falling short, there are steps you can take. For one, most qualified retirement savings plans allow for stepping up contributions as you approach retirement. Make sure you are taking full advantage of those provisions.
Also, you should check on your Social Security status and formulate a claim strategy. Many file for benefits as soon as they can. But benefits grow the longer you wait. So for some, it might make more sense to delay filing, depending on the level of their retirement savings, their health, or the possibility of continuing to work for more years.
Conclusion
No matter your age, saving is a critical element of financial wellness. So, it’s important to understand where you stand in the savings cycle in relation to the retirement you’d like to have. And whether you are early in your working years or nearing retirement, understand the options and steps you can take to try and make sure that your retirement savings meet your needs.
Feel free to reach out to schedule a discussion with our retirement planning specialist.
http://www.clearyinsurance.com/wp-content/uploads/Cleary_Logo.jpg00Carol LaCombehttp://www.clearyinsurance.com/wp-content/uploads/Cleary_Logo.jpgCarol LaCombe2022-11-01 11:35:182022-11-01 15:47:17How to Know if Your Retirement is on Track?
