Coffee heat rising

Insurance

Getting an Insurance Checkup

by

Have you checked pricing for your homeowner’s and auto insurance lately? If you haven’t, you probably should.

George Fontaine, one of the guys in my business group, is an insurance broker. Every week when we each give a five-minute pitch, he tells us he can save us money on our house and car insurance. So…naturally, when The Hartford’s bill for the homeowner’s policy arrived this month bearing a $50 increase to $848 (on top of the $1125 I’m paying for the car and the umbrella policy), I gave him a call.

He thought about it for a couple of days and then called back with some quotes. By moving from The Hartford to Safeco, I can save $506 a year AND get better coverage!

Wow. I knew those AARP policies, much touted for being the best deal on earth, aren’t always the most cost-effective or even the best insurance—their Medigap policies, for example, are substantially higher than identical coverage from other highly rated insurers. But good grief.

The Hartford was selling me $500,000 worth of umbrella coverage; Safeco’s costs less and gives me a million bucks worth. The Hartford’s personal injury coverage was less, and it didn’t include rental for a car should mine be rendered undriveable. Nor did it include roadside service—you have to buy that separately from AARP, and it ain’t very good. The new homeowner’s policy increases the amount needed to rebuild my house, should it ever burn down or be blown away, and it provides for replacement of furnishings (at what I paid for the stuff, not at depreciated prices that will buy me stuff from Goodwill). Should the palace ever have to be rebuilt, the Safeco policy provides not the usual few months but two years of temporary housing.

If that doesn’t accommodate Contractor Standard Time, nothing will. 😉

So, for a lot more coverage I’m paying a lot less money. Since I self-escrow the amounts needed for annual insurance and tax bills, in theory that $506 should put $42 back in my pocket.

In theory.

However, the Medigap policy went up by $235 this year.

Can you imagine? A two hundred thirty-five dollar increase! For something you can’t get out of. Did I get a $235 increase in Social Security? Well, yes…more like $420, actually. That’s $35 a month, which I happen to need desperately to make ends meet.

So the wonderful $506 savings will be much reduced by the health insurance bite. However, all is not lost:

Overall, then, I end up with an extra $23 a month that will NOT have to be transferred from cash flow to tax & insurance savings—reducing the monthly transfer from $445 to $422 a month.

Damn…what I couldn’t do with that $445 a month in spending money….imagine the groceries I could buy! Ohhhh well… At least I’m not having to choke up an extra $24, for a total monthly self-escrow of $479 a month, as would have been the case if I hadn’t asked George to look into this.

There’s no way I could have found this pricing on my own. For one thing, my days are chuckablock full. Trying to break loose several hours to get on the punch-a-button merry-go-round, get estimates for policies that don’t really cover the same things, and try to figure out which apples and oranges are what—just beyond the pale. That’s why I’ve stayed with the Hartford for lo these many years as they’ve slowly pushed up the rate until I can no longer afford it: hassle factor.

Well. That and their excellent service…couldn’t have asked for any better service after the late, great hailstorm misadventure.

It’s very convenient to go with an agent who has all the figures at his fingertips and knows how the system works. Not only does he have a good feel for what policies should cost and for what coverage is and is not needed, he will automatically review coverage every two years and will run interference with a company if you run into any headaches.

If you don’t have time to call a half-dozen companies and then try to figure out what coverage they’re offering and how it compares with five other policies each of which is slightly different, you really should consider finding a broker who can do the work for you. Google “insurance broker” in your area; then google the brokerage’s name with “reviews” added to seek customer comments. Or subscribe to Angie’s list and do your search there. Or ask your friends, lawyer, realtor, accountant, or money manager for references.

Health Insurance Eye-Popper

by

Wow! You should take a look at the comments on this post over at Get Rich Slowly. J.D. asked readers to report on how much they pay for health insurance. It’s just gut-wrenching. One reader remarked that she had paid tens of thousands of dollars for healthcare coverage but never made a claim; another said after she’d paid for the insurance, she couldn’t afford to go to a doctor. Another reader, who used to work for a company that did business with health insurers, described the insurers’ strategy of submitting requests for double-digit rate increases every few months, so they could settle for regular, steady single-digit increase targeting specific zip codes.

Meanwhile, if that doesn’t frost your cookies enough, the comments from Canadians—and from the guy in Japan—certainly will. One Canadian woman had cervical cancer…the only cost to her was the parking fee at the clinic where she had to go once a week for treatment. Other Canadians do remark that health care in that country is far from “free” for your taxes. But pretty clearly few or no Canadians can expect that a major illness or accident will pauperize them.

Really.  You just can’t imagine why anyone who’s not a congressional representative and in the pocket of big donors and lobbyists would oppose a national health care plan. Medicare’s not cheap—largely because of the ever-increasing rates charged by insurance companies that have managed to get their fingers in that pot, too. But at least it’s marginally affordable and does cover most conditions.

Back at GRS, comment number 234 mentions something kind of interesting. It’s a healthcare co-op for folks whose feelings about forcing women to bear unwanted babies are so strong they won’t subscribe to commercial insurance lest their morals be contaminated when some other subscriber gets an abortion to save her life. Or to have a choice about what her and her family’s life will be. It’s called Samaritan Ministries.

For a family, according to this reader, monthly cost is $320. Coverage is rather skimpy: you pay out of pocket for medical costs under $300 a month (so if you come down with a chronic ailment, your monthly cost is now $620 a month, minimum—not counting drugs, vision, and dental), pre-existing conditions are not covered, and the most it pays out is $250,000. Get yourself a case of cancer or a heart attack, and that $250,000 will be gone in a trice…you’ll soon find yourself paying a lot more than parking fees!

In the absence of a national health care plan, though, it’s an interesting scheme. If you were young and healthy, it might be worth considering. It certainly is better than nothing, and far more affordable than commercial plans that gouge you thousands of dollars for limited coverage or for insurance you can’t afford to use.

Incidentally, Samaritan Ministries publishes a guide to finding healthcare providers. One of these is an outfit that, for a fee, will collect bids from doctors for you.

Meanwhile, a Christian blogger in Alabama casts a jaundiced eye on this outfit. Writing as DrAbston, this observer points out that it functions as a loophole for Americans to get out of buying the required insurance under the new Affordable Healthcare plan, that requirements skew the membership toward cherry-picking, and that its ballyhooed Christian philosophy contains an inherent contradiction.

So it appears that the faith-based (or anything else-based) health-sharing scheme, while perhaps useful for a limited number of special-interest groups, is not a viable answer to our country’s health care issue.

When you read the responses to JD’s post—245 and counting!—you realize something has got to be done.

Insurance Frolics

by

w00t! A notice came from The Hartford’s auto insurance side announcing that next year’s premiums will…wait for it!…DROP BY $26!

Hallelujah, brothers and sisters! It’s the first time I can recall a significant drop in quite some time.

O’course, what they’re trying to say is the 12-year-old Dog Chariot is no longer worth the current annual premium of $1125. But what the heck! It’s still running, despite its $106,000+++ miles. What more can a person ask (other than decent mileage)?

Can you imagine? I’ve never owned a car that ran a hundred thousand miles. What a vehicle!

And it’s not alone. The other day I saw another just like it, parked in the blasting sun. Its formerly black bumpers were bleached, like the Chariot’s, to a powdery slate gray. But like the Chariot, somehow it has escaped serious dents. With any luck, its owner was enjoying the same automotive longevity and insurance-company largesse.

The Hartford is not giving to dispensing good news to its customers, except on the occasions that it kindly and generously covers natural disasters. I will say that the company’s coverage after the late, great hailstorm could not be beat. My house has a new roof and a new air conditoner, neither of which I could have afforded out of my own pocket—not on a bet. Handyman Jack’s painstaking and excellent paint job (fee commensurate to the quality of the job) was also covered without complaint. So were several other blandishments, not a one of which I could’ve afforded on my own.

Now…you’ll notice that the company has NOT sent me a joyous little flyer announcing a cut in my homeowner’s insurance. Dollah to donut, that will be going up, not down. But frankly, they’d have to bill an awful lot more to recover the thousands of dollars they put into this house; at least, to recover it during my lifetime. So I’m not complaining.

If the homeowner’s rate doesn’t rise more than $26, I’ll be happy.

Speaking of insurance, it’s still open enrollment for Medicare. From what I can tell, the Medigap policy won’t go up a lot. I have nothing to complain about there, either, so probably there’s no point in putting myself through the hassle of changing. Apparently there are some significant changes in Part D (prescription drug coverage), but figuring it out will take several hours, none of which I happen to have. And I’m still not taking any drugs on a chronic basis, and so there’s no way to compare. My inclination is just to stay put with what I’ve got.

It’s the lazy individual’s way, of course.

But really: does anyone have several hours to plow through this stuff and figure it out? It’s 10 after 10 p.m. as I write this. I’ve been working since 6 a.m. (got a lot done!), and my eyes are so glazed over I can barely see what I’m typing. For several weeks I’ve been telling myself to pick up the voluminous paperwork and try to figure it out. Besides the fact that the task is inherently aversive, I truly have not. had. time to do that.

Speaking of the which, it’s past time to drag off to bed!