One way to win clients is to educate them on coverage gaps. I often have potential prospects with property insurance that is full of holes from their previous agent. Do yourself a favor ... if you spend the time and educate your clients on why your policy is better, your retention rate will soar.
On an HO6 policy the buildings will be covered by the master policy - insurance the board purchases for the entire complex. Depending upon what is written in the HOA documents, and insurance policy this more than likely will ONLY insure the exterior of the unit(s). It is the property owner's responsibility to get adequate interior protection to rebuild from the studs inward.
For example, on property insurance under an HOA the homeowner could face a sizable assessment for damages not covered by the master policy after a loss. This comes to them in the form of a bill that can not be claimed on their property insurance without loss assessment coverage.
It is my understanding that loss assessment often comes with a cap of $1,000 or so toward the condo/townhome master policy deductible assessment. This can leave your client with a serious coverage gap even with loss assessment protection is added.
If they have a loss, the condo/townhome master policy may have a $10K to $50k deductible or more (depending upon property size and values). If a loss occurs this can be split up among the homeowners.
A greater gap in coverage occurs if a singular homeowner is at fault they most likely will be assessed the full amount.
Increased building contents coverage endorsement, which is like coverage A on a traditional home, increases coverage to rebuild the interior of the property which isn't covered by most condo/townhome master policies.
The unsettling part is, that some carriers HO6 policies don't have any interior contents coverage unless the increased building contents coverage endorsement is added. This may be fine if your client's master property insurance will rebuild the whole structure (interior and exterior). If not, and you don't add that endorsement, you have a huge gap in coverage.
It is VERY important to obtain a copy of your clients HOA master policy to see what type of policy they have (exterior and interior OR exterior only), and the deductible amount. The increased building contents coverage WILL cover the interior rebuild, and I do believe it will pay for assessments from master policy deductibles without a cap.
For example, if it will cost $50K to rebuild the interior of a condo/townhome, but the master policy has a $25K deductible, increased building contents should be increased to $75K to close the gap. Additionally I add the maximum loss assessment endorsement, which is usually $50k.
If you're appointed with a carrier that provides an HO6 with guaranteed replacement cost you may be okay. I would still add a generous loss assessment endorsement.
This is how you win clients based on education and quality not price.
This is an introduction to my question:
What are other gaps may exist in auto and property insurance, and what have you done to close those gaps to insure your client(s) are protected better than their previous agent?
You're doing this, right?
On an HO6 policy the buildings will be covered by the master policy - insurance the board purchases for the entire complex. Depending upon what is written in the HOA documents, and insurance policy this more than likely will ONLY insure the exterior of the unit(s). It is the property owner's responsibility to get adequate interior protection to rebuild from the studs inward.
For example, on property insurance under an HOA the homeowner could face a sizable assessment for damages not covered by the master policy after a loss. This comes to them in the form of a bill that can not be claimed on their property insurance without loss assessment coverage.
It is my understanding that loss assessment often comes with a cap of $1,000 or so toward the condo/townhome master policy deductible assessment. This can leave your client with a serious coverage gap even with loss assessment protection is added.
If they have a loss, the condo/townhome master policy may have a $10K to $50k deductible or more (depending upon property size and values). If a loss occurs this can be split up among the homeowners.
A greater gap in coverage occurs if a singular homeowner is at fault they most likely will be assessed the full amount.
Increased building contents coverage endorsement, which is like coverage A on a traditional home, increases coverage to rebuild the interior of the property which isn't covered by most condo/townhome master policies.
The unsettling part is, that some carriers HO6 policies don't have any interior contents coverage unless the increased building contents coverage endorsement is added. This may be fine if your client's master property insurance will rebuild the whole structure (interior and exterior). If not, and you don't add that endorsement, you have a huge gap in coverage.
It is VERY important to obtain a copy of your clients HOA master policy to see what type of policy they have (exterior and interior OR exterior only), and the deductible amount. The increased building contents coverage WILL cover the interior rebuild, and I do believe it will pay for assessments from master policy deductibles without a cap.
For example, if it will cost $50K to rebuild the interior of a condo/townhome, but the master policy has a $25K deductible, increased building contents should be increased to $75K to close the gap. Additionally I add the maximum loss assessment endorsement, which is usually $50k.
If you're appointed with a carrier that provides an HO6 with guaranteed replacement cost you may be okay. I would still add a generous loss assessment endorsement.
This is how you win clients based on education and quality not price.
This is an introduction to my question:
What are other gaps may exist in auto and property insurance, and what have you done to close those gaps to insure your client(s) are protected better than their previous agent?
You're doing this, right?
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