Risk e-Business

Buying, Selling or Renting? Better Know About Maine's New CO Detector Law

Beginning November 1, 2009, a new Maine law requires smoke detectors and carbon monoxide detectors in every rental property, and in any residence purchased after that date.

Detectors Required

• Must be 120V with battery backup and powered by the building's electrical system.
• Plug in units are acceptable, as long as they have a battery backup.
• Detectors must be in each unit, near bedrooms for apartments or rental homes - even seasonal or occasional rentals.
• Must be photo-electric type if located within 20' of a kitchen or bathroom.

Buying a Home?

Buyers (not sellers) must certify that these detectors are in the property in order to close on a purchase & sale agreement. The Maine Dept. of Public Safety is drafting a certification form which will be used for this purpose.

For more information:

• Maine Fire Chiefs' Bulletin about the new law.
  
• YouTube Video by ME Association of Realtors

Should You Insure Your Middle Schooler's Laptop?

As another school year begins, our clients who are parents of middle school students are asking us about insuring the laptop computers issued through the Maine Learning Technology Initiative. Our understanding is that the State does not have a "blanket" insurance program; however, many school departments appear to offer separate insurance coverage. 

 In general, we recommend that our clients buy the coverage through their child's school. Here's why:

• School property - The laptop belongs to the school, not the student. Therefore, it's not considered owned personal property as defined by a homeowners policy. 
• Lower Deductible - The standard homeowners insurance deductible is $500.00. Most school programs feature a $50.00 deductible.
• Broader coverage - Most homeowners policies don't cover such perils as dropping the computer, closing it in a locker, etc. The school contracts we've seen cover most damage, unless it's intentional and willful. 

Each school insurance program has restrictions; for example, some prohibit taking the computer out of Maine. Be sure to read yours before choosing how best to protect your child's computer. For more information, contact us at Noyes Hall & Allen at 799-5541. 

3 Things Every Coastal Homeowner Should Know About Flood Insurance Changes

As the Press Herald reported in this September 5 story, FEMA is updating its current flood hazard maps for much of the southern Maine coast. These maps are used to determine insurance costs in the National Flood Insurance Program (NFIP), the only flood insurance available for most properties. FEMA proposes to change the zoning of much waterfront property in South Portland, Portland and Cape Elizabeth. The cities of Portland and South Portland are challenging the new zoning, but there's no guarantee that they will be successful. 

The Zone Differences

FEMA's zone classification system defines an area that has a 1 percent chance of being inundated by flood waters in a given year a "special hazard area". There are two categories of "special flood hazard areas", "A" and "V". 

The difference is that "A" zones are low-lying areas subject to flooding, while in "V" (velocity) zones, the water is more likely to flow with the increased hazard and damage of wave action. Many of the proposed changes would switch local oceanfront property from an "A" zone to a "V" zone; some may extend "A" zones to properties not previously considered to be in a "special hazard zone".

How This May Effect You

Compared to properties not in a "special hazard zone", Properties in an "A" zone:

• Pay higher flood insurance rates.
• Are required by FHA lenders to be insured for flood.
• Require an "elevation certificate" - a special survey that the property owner must pay for and provide to the flood program.

In addition to these conditions, properties in a "V" zone:

• Pay even higher flood insurance rates
• May be unable to purchase flood insurance if they're on piers or wharves that are over water.

What You Can Do

View local flood maps at your local planning office. 

• South Portland - Steve Puleo - 767-7648.  
• Portland - Penny St. Louis Littell - 874-8719
• Cape Elizabeth - Bruce A. Smith 799-1619

If your property is proposed to be re-located into either an "A" or "V" zone, call your insurance agent immediately. Since the maps are not yet effective, property owners can take advantage of cost-saving options that allow them to "lock in" at their current zone. Depending on your property's value and location, this could save you thousands of dollars per year. 

For more information, call Noyes Hall & Allen Insurance at 799-5541, or the FEMA Map Assistance Center at 877-336-2627.

* * * UPDATE * * *

The Portland Press Herald  reported on September 21 that FEMA is delaying implementation of the new flood maps, and will re-start the appeal process, likely in early November. The agency cited technical errors in the notification process, not any methodological errors, as the reason for the delay.

Sending Kids Off to College? Check Your Insurance!

If your house is like mine, you have random piles of clothing, boxes of ramen noodles and bedding all over the place, waiting to load into the car for the annual college move-in. Ours moves in this weekend (let's hope Tropical Storm Danny stays clear!)

College is one of the biggest expenses we parents face in our lifetimes. With finances so tight, it's certainly not the time to find out that an accident or theft isn't covered by your insurance. Here are a few common scenarios, and how the policies WE sell respond. YOUR policy may be different.

Homeowners

• Your kid's "stuff": Most home policies provide 10% of your personal property limit for belongings located at a residence other than the insured home. So, if you have $100,000 of contents coverage ("Coverage C" on your policy), $10,000 of it follows your children to school, if they live in a dormitory. Of course, the damage has to be caused by a peril covered by your policy.
  Certain items, like jewelry or expensive electronics, might need special coverage. Contact your agent.
  
  If your child leases an off-campus apartment, they should probably get their own renter's insurance. Your agent can tell you for sure.
  
  
• Liability: Even brilliant students can do stupid or careless things. Luckily, your homeowners liability coverage follows them, as long as their permanent residence remains your home. But that general dorm damage bill you got for the discharged fire extinguishers: all yours, sorry. Damage to a rented property is not covered by homeowners policies. 

 
Car Insurance

Even though it's tempting to remove your children from your auto policy to save money, it's a bad idea. They still need coverage for times when they're home, or if they borrow someone else's car. Hey, it happens.

• "You're not taking that car to school": If your child is away over 100 miles without a car, most insurers offer a discount on your auto insurance.
• "But I need to have a car so I can (insert excuse here)": Somewhere around second semester sophomore year -if not before- you'll hear this. If you let them take one of your vehicles to school, make sure your insurer knows about it. Sure, you'll pay more for insurance, but you won't have to explain why your BU student was driving on Comm Ave on a Wednesday night. Awkward!
• "So I borrowed Griz' car..." Your student is covered under your policy as long as they remain a member of your household. The primary coverage for any accident comes from the owner's insurance policy (if any). Yours would be secondary. Same thing applies if your child lends someone else your car (you just shuddered a little at that thought, didn't you?)
• Dean's List pays: Just like high school, a "good student" credit applies for kids who maintain a "B" average. Keep your agent posted to make sure you're getting the discount.
  

For more information, contact your agent or company. Or, give Noyes Hall & Allen a call. After all, we just gave you a bunch of free advice, didn't we? And we've got kids to put through college too!

Thinking About Renting Out Your House?

In the current real estate market, more and more of our clients are renting their homes instead of selling them. They hope that they'll make more profit by waiting. In the meantime, they're collecting rental income on the property.

Many people don't know that a rented home is no longer eligible for a homeowners policy. To properly insure your rented dwelling, you need to buy either a Dwelling Fire policy or a commercial policy.

The Risks of Renting
Rental property has a slightly higher risk of property loss, for several reasons:

• Your tenants may not identify or report maintenance needs so that you can address them.
• Renters are unlikely to have the same degree of "pride of ownership" as you.
• Your renters may be unfamiliar with the systems and "quirks" of your home that are second nature to you. We've even seen losses where the tenant did not know how to shut off the water to stop an overflowing toilet!

Different Perils, Different Policy
As a homeowner, your policy covers your home and your belongings. When you rent out your home, your contents are typically limited to appliances you might leave behind for the tenants. Also, if your rented property is damaged, you could lose twice: the cost to repair the damage, and the rental income lost while your tenants can't live there.

Most important, renting your home increases your responsibility for injuries on the premises - anything from slips and falls to someone being hurt during a fire. This increases the importance of inspecting and maintaining your property.

Dwelling Fire and commercial policies can protect the building and rental income. Often, the coverage isn't quite as broad as your homeowners policy, but it still covers the catastrophic losses of fire, windstorm, collapse from ice or snow, etc.

Like homeowners policies, these policies do not cover flood or earthquake - although such coverage is available.

Considering Renting Your Home?

• Call an agent for an insurance quote.
• Consider higher deductibles and higher liability coverage than your current homeowners policy may have.
• Check on your property regularly; hire a property manager if you can't.
• Require your renters to buy tenants' insurance to protect their property and liability from their own negligence. Your policy will not provide coverage for either.

For answers to your personal insurance questions, contact Noyes Hall & Allen Insurance.

The $50,000 Tweet?

Our May 29 post warned about the danger of being sued for damages caused by blog entries, tweets, or Facebook content. 

Today, Mashable reports on a Chicago Sun Times article about a real estate management company suing a tenant of one of its buildings. The May 12 tweet complained about the company's response to her allegations of mold in her apartment. The company was not amused, suing the woman for $50,000 in damages, claiming that she libeled them.

Make no mistake: it's expensive to respond to a lawsuit - let alone lose one. Let's hope that the woman had a homeowners or renters policy with optional "personal injury" coverage as we suggested in our original post. This coverage is NOT part of a standard homeowners policy, but can be added for about $15 or $20 per year.

For more information about personal insurance, contact Noyes Hall & Allen Insurance today.

Slips and Falls Can Be Costly. Protect Your Friends - and Yourself!

Maybe it's all the rain and snow we've had this year. Maybe it's the economy . Maybe it's the increase in ads for plaintiff attorneys. Whatever the cause, it seems we've seen an increase in slip-and-fall liability claims lately.

Our agency would normally see one or two slip-and-fall accidents in a 6-month period. This year, we've seen almost that many every month. On stairs and in parking lots, in retail stores and private homes, southern Mainers seem to be having trouble keeping their balance.

It's possible that today's higher unemployment rates have left fewer people with medical insurance available to pay for their emergency room visits and doctors' treatments. With last winter's heavy snow and this spring's constant rain, surfaces have been especially slippery. Combine those factors with the power of suggestive advertising by plaintiff attorneys telling the public that "someone has GOT to pay", and it may be logical that we have seen more slip-and-fall claims.

What can you do to protect your guests, yourself and your assets?

• Maintain your property
• Carry adequate liability insurance limits: equal to your net worth, or $500,000 for individuals and $1,000,000 for businesses - whichever is higher.
• Report any injuries or incidents to your insurance agent.

For more information, call Noyes Hall & Allen Insurance.