The most recent mudslide in Montecito destroyed many homes and has killed at least 15 people with some still missing. Those fortunate enough to have come out unscathed are left without homes and the treasured personal property within them. In light of this event, we dive into our area of expertise on the matter and explain the insurance coverages on mudflow.
How are those homes and personal property covered?
Landslides and mudslides are primarily earth movement. With a mudflow, the primary ingredient is water which then picks up the soil and turns into mud. So, flood insurance will typically cover parts of a mudslide related loss.
Many homeowners in the Montecito area did not purchase a flood policy as they did not feel they were in a flood-hazard area, nor was it likely they were even offered it. But what many people fail to understand is that a flood policy covers mudflow and more.
From Fire to… Mudslide?
California’s wildfires cleared nearly 300,000 acres of land and over 1,000 structures last month from the Thomas fire alone. That left the ground bare of much vegetation. So, when just over 5 inches of rain fell on the burned area, the conditions were all too ripe for mudflow.
Mudflow
Yet another natural disaster that has devastated the U.S. in the past several months – can happen without warning and can be deadly. Rain and mud quickly accumulate, causing muddy rivers to form as debris tear through communities vulnerable to nearby land that has been charred. This is what happened in a Montecito neighborhood and swaths of Ventura and Santa Barbara counties, resulting in a mandatory evacuation for thousands. (LA Times)
According to the U.S. Geological Survey, wildland fires are inevitable in the western United States, where human development has crept into once-forested areas. After a fire, mudflow can then happen quickly without warning and further destroy vegetation, block drainage, damage buildings and endanger humans.
With the heavy rainfall bringing mudflow, stay alert and pay attention to your surroundings. Listen for unusual sounds that might indicate moving debris, such as trees cracking or boulders knocking together. And as with all natural disasters follow your local official’s directions for safety.
Employment practices liability insurance (EPLI) is another form of business insurance that’s increasingly important as your business and its employees grow, change, and develop. EPLI protects a business, its owners or officers, employees and managers against claims or lawsuits including discrimination, wrongful termination, sexual harassment, failure to promote and other employment related allegations.
With today’s business environment and industry being intertwined with technology it’s easy to imagine that these new technologies put in place may inadvertently expose employee benefit enrollment or personal employee information publicly; EPLI protects against such scenarios. Other scenarios might come to mind in light of recent high-profile scandals of sexual harassment claims and lawsuits.
Examples
Harassment Claim – a female employee working for a construction company alleged that her male co-workers sexually harassed her by making derogatory comments about women in her presence. After complaining to her supervisors, the harassment increased. This resulted in $20,000 in compensatory damages and $80,000 in punitive damages awarded to the victim.
Age Discrimination – An age discrimination lawsuit was brought by a highly paid 62 year old sales representative who was employed by the insured. he was terminated for not meeting his sales quotas. Despite layoffs and cutbacks at the company, there was no documentation that showed the plaintiff was a poor performer. A settlement of $540,000 was reached.
Racial Discrimination – A group of Indian descent applicants sued a private retail store for ethnic and racial discrimination after learning they had been denied employment strictly based on their race and ethnic background. The Defense Cost and settlement was over $200,000.
Sexual Harassment Lawsuit – A male employee claimed that he had been being stalked and harassed by a female executive, culminating with the executive pinning him against a wall and kissing him at a company retreat. The defense and settlement of the case exceeded $400,000.
Retaliation Lawsuit – The Executive Assistant to the Chief Financial Officer was terminated for divulging confidential information to staff regarding impeding company layoffs. A suit was brought by the assistant for retaliation and sexual harassment as she claimed the CFO always made suggestive comments and improperly touched her. Defending the CFO cost over $150,000.
Did You Know?
Over 40% of EPL claims are against firms with fewer than 100 employees.
The average cost of defense for employment litigation is $150,000 to $250,000.
47% of plaintiff verdicts are between $100,000 and $500,000.
The Equal Employment Opportunity Commission (EEOC) recorded nearly 100,000 charges in 2013.
Discrimination and/or harassment coverage applicable to customers and other 3rd parties may be available.
It only takes a few minutes to review your current coverages and the premium you can save. We partner with the leading carriers which enable us to obtain a variety of prices and insurance rates to find the best combination of coverage for you. Once your coverage is in place, our job really begins; we work as your advocate, providing ongoing advice, guidance and support.
When it rains, it pours. And when it pours, rivers and creeks tend to flood. Water can be a very powerful force when it becomes abundant enough, and flood damage can be very costly if you need to make repairs to your home. Unfortunately, many property owners are unaware that flood protection is not included in homeowner’s insurance and must be purchased separately as a flood insurance policy.
A city street is flooded. Rescuers in a kayak attempt to reach survivors in an apartment complex.
National Flood Insurance Program Statistics
Floods are the #1 natural disaster in the U.S.
The average flood insurance claim in recent years is $35,000.
From 2002 to 2011, total flood insurance claims in the U.S. averaged nearly $3 billion annually.
New Jersey is the top state in the U.S. for flood insurance claims. More than $628 million of claims payments were paid in the state in 2011 alone.
People who live outside high-risk flood areas file more than 20% of NFIP claims and get more than 33% of disaster relief funds.
What Kind of Flood Insurance Do I Need?
There are several kinds of flood insurance coverage you can purchase:
Standard Flood Insurance Policy – Dwelling – The most common form of coverage, used to insure up to 4 family residential buildings and single-family dwelling units in a condo/townhouse building
For standard dwelling coverage, you have two options:
Building property coverage – up to $250,000
Personal property coverage – up to $100,000
You can opt to purchase just one of these, or both – but the NFIP strongly recommends homeowners purchase both coverage options. It’s a good idea to speak with your lender, as a mortgage company can also require you to carry a certain amount and type of flood coverage.
These two combined coverage types will cover most things in your home, with some exceptions. For example, you will not be reimbursed for damage to most cars and ATVs, any belongings outside of the building (including landscaping, septic systems, patios, hot tubs, and swimming pools), currency, precious metals, or stock certificates.
If you have a multi-story home, the coverage could be more complicated depending on your location in a flood zone and the age of your home. Basements, crawlspaces, and walkout basements have limited coverage, no matter the age or type of home you have. If your home has any of these items, make sure to ask your insurance agent about how your items can be protected from flood damage. For example, even if you carry both building property and personal property coverage, you may not have any insurance protection for the following items in your basement:
Personal items, like clothes, electronics and furniture
Non-drywall walls or ceilings
Carpeting
Paneling
Bookcases and built-in units
Window treatments
A flood policy won’t ever pay out any more than the exact amount of the policy (i.e. never more than $250,000 for structural damage). You can choose to buy building property flood insurance that’s either at replacement cost value (RCV) or actual cash value (ACV). You can only buy personal property flood insurance at ACV coverage amounts. These two types of reimbursement generally break down this way:
Replacement cost value: The cost to replace items that are damaged, without considering depreciation over time
Actual cash value: The cost to replace items at the time of the loss, considering depreciation
Flood insurance is complicated. It’s highly recommended that you speak to a professional agent who can help you get the coverage you need and fully understand your options.
What Events Does Flood Insurance Cover?
Flood policies cover physical damage to structures affected by flooding from heavy snowmelt, runoff following heavy rainfall, and so on. Your flood insurance policy will also cover any damage caused from erosion due to currents or uncommon water cycles (for example, if your home is built along a shore that collapses due to waves, currents or rising water).
Damage caused by mudflows or mudslides can be covered, but the policy may have very specific definitions for a covered mudslide event. It’s important to read your insurance documents if you are in a high-risk mudslide area.
How Much Does Flood Coverage Cost?
Premiums for flood insurance coverage vary greatly from state to state and area to area, and depend on a variety of factors including flood risk and the value of the home being insured. Flood insurance can be as low as $140 per year, for a renewable one-year policy.
Do I Need Flood Insurance?
Flooding occurs in all 50 states and is not covered in home or renter’s policies. But does that mean everyone should have flood insurance? The choice comes down to your level of risk. Unfortunately, that can be difficult to determine.
According to FEMA, most people are likely to need flood insurance at some point. FEMA has flood plain maps for every area in the country, and it lists areas as 10-year, 30-year, 50-year or 100-year floodplains based on elevation, slope of the land, soil, proximity to water sources and other factors.
What Is the National Flood Insurance Program (NFIP)?
The NFIP was instituted by Congress in 1968 to provide flood insurance policies to homeowners, business owners and renters in communities that participate in the program. The flood program, which is administered by FEMA, works with more than 90 private insurance carriers to provide flood insurance to cover damages that result from flash floods, hurricanes, winter storms or heavy rains.
There are many reasons people choose to rent rather than buy a home. Whether you are a college student, you are saving up for a down payment on a house, or you simply like the flexibility of apartment living, it is a good idea to become familiar with renters insurance and how it can protect you. If you’re considering purchasing a renters insurance policy in Eugene, Oregon, you may have some questions. Do you really need this coverage? Is it worth it? How can you get the best deal?
What Is Renters Insurance?
Renters insurance provides low cost coverage for your personal belongings, so you can recover from loss, damage or theft. It also covers your personal liability. Your landlord’s policy covers the building and grounds, but will not reimburse you for the costs of your personal items in the event of a loss, or cover the costs of injuries or damage that happen inside your living space.
Landlords insure their rental properties with homeowners or landlords insurance. These policies provide coverage for the structure of the building, any personal property the landlord owns (such as appliances and carpeting) and liability for injuries due to the property owner’s negligence in upkeep or safety of the property.
But in the event that your personal belongings and valuables are destroyed in a building fire or stolen by a thief or lost while traveling, you need to have a renters insurance policy in place to cover your losses. If you do not have such a policy, you will need to recover from your loss out of pocket.
Should I Buy Renters Insurance?
Renters insurance is not mandatory in any state, so Oregon renters are not obligated to purchase it across the board. In some cases, however, landlords will require their tenants to buy renters insurance, and they are perfectly within their rights to do so.
You are most likely to be required to carry renters insurance if you live in an apartment building or other type of multi-unit rental. The main reason for this requirement has to do with liability coverage for the leasing company and the other tenants. If you should accidently start a fire, your landlord and other affected tenants can receive reimbursements through your policy.
Whether or not you are required to carry this insurance, choosing to purchase a renters insurance policy is a wise decision that will protect you from devastating loss.
What if I Don’t Own Anything Worth Insuring?
Many people who rent rooms in Eugene homes feel that renters insurance is an unnecessary expense. While you may not have a lot of expensive belongings, if you take the time to write down an inventory and an estimated value of everything you own, you may be surprised. Be sure you list everything including all your furniture, clothes, dishes, electronics, jewelry, bicycle, gym bag, and even cosmetics. Now think about how much it would cost to start with nothing and replace everything you own. That is exactly what you would have to do if a fire or natural disaster caused you to lose everything.
Now look at your most valuable items. What if they were stolen? Could you afford to replace them? The average renter owns $20,000 worth of personal belongings. Statistically speaking, apartment residents report burglaries more frequently than people living in houses. Renters insurance allows you to be prepared so that you will not be faced with undue financial burdens in their wake.
What Does Renters Insurance Cover?
A renters insurance policy through an insurance agency like Steele Group Insurance covers your personal belongings or “contents” against damage and loss. This includes loss from theft, fire, and even smoke, which can be quite destructive. Your contents insurance may provide actual-value reimbursement for your items, or, for a slightly higher premium, may cover your full replacement cost. If most of your possessions are older or worn, the more expensive policy is ideal as you will be able to purchase new items to replace everything you lost.
Your rental-home or apartment insurance will typically cover the cost of temporary housing if your home should be uninhabitable for a period of time following a incident. It is important not to assume that your landlord will cover this cost for you, as that will depend upon the cause of the fire and the landlord’s specific coverage.
Another coverage that renters insurance provides is in the event that your automobile is broken into and your personal items are stolen out of the auto, your renters insurance is how your personal items are covered. Especially in an area like Lane County, where theft from a vehicle is one of the most common crimes, this coverage can be particularly helpful.
Another coverage that renters insurance provides is while you are traveling and your luggage is lost or stolen from a hotel, your renters insurance is how your personal property is covered.
Finally, your policy will provide liability insurance should you be held responsible for an injury to a visitor in your home. This coverage can be quite beneficial as medical bills can add up quickly. Even something as minor as a trip to the hospital for stitches can cost more than a full year of renters insurance coverage.
Is Renters Insurance Expensive?
In 2010, U.S. tenants spent an average of $185 per year for their renters insurance policies. At only $15 a month, this is not an unmanageable expense; most people spend more than that on pizza each month. If you are fortunate enough to never have to file a claim, the money will have still been well-spent for the peace of mind it can provide.
Contact Steele Group Insurance today to get a quote on renters insurance for your home or apartment rental.
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Steele Group offers a variety of personal insurance policies to protect the most important things in your life. Our personal insurance options include home, renters, auto, RV, ATV, motorcycle, earthquake and flood insurance.
We can help protect your business and your customers. Our commercial insurance options include property and liability insurance, surety bonding, workers compensation and aviation insurance.
We offer a variety of health insurance options from top-rated companies. Our team will work closely with you to determine the best type of coverage for you.
Steele Group Insurance handles all our insurance needs in many states. We have always gotten great rates and we feel like we have an advocate, not just an agent. Their team always gets back to us immediately with any questions or concerns and is courteous and professional. We highly recommend this agency for anyone looking for a new insurance agency or to make a change from their existing one.
