Monthly Archives: August 2011

Flood Insurance

It rains a lot here. So much so that a certain franchise reported that vampires find the over cast  Olympic Peninsula habitable.  In most places, the rainfall we receive would cause damaging floods.  Fortunately, our beautiful wetlands and forests thrive in these conditions.  The roots of the trees, rich soil, and the flora in the wetlands prevents most major flooding that would occur if the Olympic Peninsula was completely urban.  That said, water damage can still occur on your property requiring costly repairs.

What is Flood Insurance?

Washington State Flood Insurance covers damage to property caused by water. Often property that is underground such as a basement is not covered like property above ground, so it is good to check the details of your policy. According to the National Flood Insurance Program, “all homeowners in [high flood risk areas] with mortgages from federally regulated or insured lenders are required to buy flood insurance.”  The Federal Emergency Management Agency, FEMA, is currently updating its flood maps, so I could not obtain the current flood risk information for Clallam and Jefferson Counties.


It is important to note that Flood Insurance is not covered by your regular Washington State Homeowner’s Insurance, so you must purchase it through either the National Flood Insurance Program or from an insurance agent, who is certified by FEMA. Homer Smith Insurance is certified and we have a page on our website dedicated to more information about Flood Insurance.  

The Language of Insurance Continued

Did you know that the Hawaiian alphabet only has twelve letters a, e, i, o, u, h, p, l, m, n, w, & k? Unfortunately, the language of insurance uses all twenty-six letters to form words we generally don’t use in the vernacular.

Actuary – A mathematician who calculates probabilities, payments, and interest rates in insurance.

Convertible – If your life insurance is on a “term,” short fixed period of time, it can be changed to a permanent insurance plan if your term policy was specified as convertible.

Indemnity - The payment made to a person to compensate or restore a loss. Often the person or group paying the indemnity is responsible for the loss.

Just be glad you don’t have to learn Khmer, a Cambodian language, which has “33 consonants, 23 vowels, and 12 independent vowels” according this website.

A History of Insurance

Where did the concept of insurance come from?

Insurance has always been problem solving strategy in case of a catastrophe.  Many people site the code of Hammurabi
as the earliest written reference to a “policy.”  In fact, the code
offered an alternative to a person who owed a debt. If debtor could not
pay because a harvest failed, the debt was deferred to the next year
with no interest payments. On the Ancient History Source Book on the
Fordham University
website I found this translation of Hammurabi’s law “If
any one owe a debt for a loan, and a storm prostrates the grain, or the
harvest fail, or the grain does not grow for lack of water; in that
year he need not give his creditor any grain, he washes his debt-tablet
in water and pays no rent for this year.

This may seem like a very contemporary concept of fairness, yet most of
his code includes eye-for-an-eye punishments that may seem ludicrous
modern law.


As
I was researching history of insurance, I came across an article on
investopedia.com that mentioned medieval guilds as an early form of
group insurance.  I am unfamiliar with the history of Europe in the
Middle Ages, so I did some research on the
website
for the Economic History Association. Two examples of medieval guilds
are merchant and craft guilds. Merchant guilds were organizations in
which members were under contract to assist a member who was unable to
sell his merchandise. In craft guilds, artisans collected money, as a
coalition, in case one of their members encountered difficulties.

For the history of Homer Smith Insurance check out our page.

Automobile Insurance

There are pluses and minuses to purchasing a used car. You can get a nice car that is in good condition and only a couple years old at a fraction of the original price.  On the other hand it is difficult to know if the car is truly in good condition. Many of my friends will invite a trusted friend who is automobile savvy to look at used vehicles with them. Thanks to United States laws, you can run vehicle history on AutoCheck and other similar websites. This webpage on Edmunds.com also offers a list of all the factors you should pay attention to when test driving a used car.

Are you saving on Washington Automobile Insurance by purchasing a used vehicle?


The easy answer is yes. The premium cost is lower because a used car does not represent as big of a financial investment to the owner as a new car would.  For example, if the a used car was damaged it a collision it might cost less to get a new vehicle.  According to Auto Insurance USA, “used cars also can inflict an equivalent damage to other vehicles, people, structures, etc, the liability rates are the same, regardless of how old the car is.”  You may not save a huge amount on insurance with a used car, but you will certainly save on the price of the car.

Boat and Watercraft Insurance

I sometimes catch myself getting a bit nostalgic during the last week of August. This week often marks the end of summer vacation for K-12 children. Even the kids who are excited to go back to school to meet new friends and study new subjects, accept the challenge to pack in as much summer fun as they can.  The good news is that the weather generally stays warm though September in the Pacific Northwest, so your boats and recreational vehicles don’t have to go into storage just yet.  

If your children are old enough to use your watercraft or if you want to feel more comfortable on your Personal Watercraft, there are a variety of watercraft safety classes available through the United States Coast Guard. Any PWC can be dangerous without proper handling. This Spring, a hip hop singer named Sean Kingston was injured while using a jet ski. Unfortunately, he is in good company, because many injuries, even deaths occur each year from PWC accidents. Washington Boat and Watercraft Insurance will help cover injuries incurred on your PWC and protect your assets if your vehicle is damaged or causes damage, but Insurance can not protect your personal safety.  Life jackets and other safety equipment can prevent expensive visits to the hospital and even save lives.  There are options to rent gear for a short period of time so that you don’t have to buy and store it.

Enjoy your summer and your PWC’s. Your kids still have the weekends to soak up the sun on their heavily sun blocked skin.

Renters Insurance


In my last post I discussed what to do in the unlikely, although possible, event that you are victim of a burglary. It is important to have Washington State Renters Insurance and/or Homeowners Insurance to protect your assets.  It is also useful to review ways to prevent a burglary and I thought you, as a savvy homeowner or renter, might appreciate some tips.

One mistake that many people make is announcing that they will be leaving on vacation on their social networking sites. You do not want to advertise to the vast Internet that your home will be uninhabited. There are now options on most networking sites to limit who can view a specific post. Even if your privacy settings are set to only friends you may want to limit your announcement to only close friends and family if at all.

If you are leaving for a long period of time it may be wise to hire a house sitter even if you don’t have pets. When I was younger, a friend of the family, who was vacationing for a month, asked me to go to her house, do my homework, and leave a light on, so that it looked like someone was home.

The Discovery Channel has a show I saw an episode of a few years ago called “It Takes a Thief.” I learned that many burglaries happen during the day while people are at work, but to prevent a night theft while you are away, have a light on a timer to make it seem like someone is home. “About 30 percent of private homes have security systems. Homes without security systems are two to three times more likely to be broken into…” and “…make sure your house alarm is connected to the police and a central station to ensure someone will respond.” -It Takes a Thief.

Commercial Property Insurance

I recently read an article in Property Casualty 360 about theft of heavy equipment from homes and businesses.  First, the good news: Washington State is not one of five states that reported the most theft in 2010. The bad news is that in the event that one of these pieces of equipment is stolen it is extremely expensive to replace. Almost half of all types of equipment stolen are electric mowers which usually cost less than 10,000 dollars, but a tractor, the second most stolen item can cost more than 40,000 dollars. If a business or person is not properly insured for these items, they could lose time and money, while replacing the lost equipment. At Homer Smith Insurance we can help you determine the best Washington Commercial Property Insurance to protect your business from the impact of theft.

Insurance is incredibly important, but so are theft prevention and recovery strategies. Alarm systems and signs to indicate that such security measures are in place will deter thieves, who are looking for a clean getaway. If you have purchased valuable mobile equipment it is probably worth registering your item with the National Equipment Register. This extra documentation will help identify your equipment if it is recovered. In the event that your equipment is stolen, it is also a good idea to report the theft to both the National Equipment Register and the police. Another responsible buyer may discover your equipment on the used market after using the Iron Check database on N.E.R. to make sure they are not purchasing stolen equipment. If you or an employee left personal information in the equipment, such as a wallet, it is also important to inform the police, bank, and credit card companies of the possibility of identity theft. Finally, take photographs of your equipment so that the police have a visual reference and your insurer has proof of your ownership.

The Language of Insurance


The subject of insurance is not always the easiest topic to understand. No matter how intelligent you are if you never studied Italian, it would be ridiculous to expect you to hold a conversation in Italy. The same applies to the language of insurance, that is why at Homer Smith Insurance we make every effort to make the Washington State insurance as clear as possible.

As someone who always likes to bring the little tourist language books with me to try to communicate in the native language, I thought you might enjoy a translation of a few common insurance terms.

Attained Age can mean that a person has reached a previously defined age to receive benefits such as a trust fund or a pension. It can also mean a policy holder’s age that is used to determine the cost of his or her policy.

Elimination Period is the amount of time after a person purchases an insurance policy for the policy to take effect.

Grace Period is the amount of time that an unpaid insurance policy still covers you. This is usually not much longer than a month.

Sources for these definitions: businessdictionary.com and investopedia.com

Commercial Property Insurance

I recently read an article in Property Casualty 360 about theft of heavy equipment from homes and businesses.  First, the good news: Washington State is not one of five states that reported the most theft in 2010. The bad news is that in the event that one of these pieces of equipment is stolen it is extremely expensive to replace. Almost half of all types of equipment stolen are electric mowers which usually cost less than 10,000 dollars, but a tractor, the second most stolen item can cost more than 40,000 dollars. If a business or person is not properly insured for these items, they could lose time and money, while replacing the lost equipment. At Homer Smith Insurance we can help you determine the best Washington Commercial Property Insurance to protect your business from the impact of theft.

Insurance is incredibly important, but so are theft prevention and recovery strategies. Alarm systems and signs to indicate that such security measures are in place will deter thieves, who are looking for a clean getaway. If you have purchased valuable mobile equipment it is probably worth registering your item with the National Equipment Register. This extra documentation will help identify your equipment if it is recovered. In the event that your equipment is stolen, it is also a good idea to report the theft to both the National Equipment Register and the police. Another responsible buyer may discover your equipment on the used market after using the Iron Check database on N.E.R. to make sure they are not purchasing stolen equipment. If you or an employee left personal information in the equipment, such as a wallet, it is also important to inform the police, bank, and credit card companies of the possibility of identity theft. Finally, take photographs of your equipment so that the police have a visual reference and your insurer has proof of your ownership.

Recreational Vehicle Insurance

It’s August! The days are long, the sun is bright, and the highway is full of campers headed on vacations. If you plan to be in one of these RVs, headed to beaches and campsites this summer, you will want to understand Washington Recreational Vehicle Insurance.  Your basic Automobile Insurance probably won’t cover your Recreational Vehicle completely, but the amount and distance you drive your recreational vehicle will factor into the cost of your insurance. Similar to Automobile Insurance, it is important to share with your insurer how often you will be using your RV, as well as your driving record.

According to this New York Times article, “The National Oceanic and Atmospheric Administration predicts an above-normal hurricane season this year.” Weather is important to consider when purchasing Recreational Vehicle Insurance because you may be traveling to locations that are susceptible to storms.

Once you’ve been insured you can truly relax at your chosen vacation destination. If you haven’t picked a destination yet here is a website with descriptions of the top one hundred campsites in the lovely Evergreen State. Happy travels!