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Adjusting insurance in tough times

It is no secret that our economy is the worst it has been in a long time. People have lost their jobs, others have had their hours and therefore their income reduced and some have had their income reduced without reducing hours, in an attempt to shore up sagging sales/revenues to help their respective employers stay in business and retain their jobs.

While homeowners’ insurance prices have come down, primarily for homes eligible for wind mitigation credit, and commercial property premiums have dropped dramatically as well, many are still struggling to pay for their insurance. Let me offer a few tips to individuals and business owners to help in these tough times.

Determine how much you can afford to pay for insurance. It may well be less than you could afford two or three years ago. Communicate this information to your agent. While, obviously, you will have less coverage if you pay less premium, you will end up with the most coverage for what you can afford and it will be easier for you to make your premium payments on time. If possible, raise your deductible to the next level. For example, if it is now $250, raise it to $500. You don’t want to report smaller claims to your insurance company as this can increase your premiums in the long run. Business owners should have a minimum of a $1,000 deductible.

For individuals, there are choices as to homeowner insurance coverage as well as auto insurance. You can change coverage from a broad form that covers more perils, such as theft and wind/hail to a basic form that excludes these coverages. I do not recommend this, but you may need to do so if you cannot afford to pay for this.

The same is true for business owners. Insurance policies for commercial buildings, contents and business liability can be modified to a certain extent, as can policies for commercial autos.

While you can reduce your life insurance, again, this should only be in instances when you must reduce your insurance budget. While property and casualty coverages can normally be changed easily, a change of health for the worst would prevent you from later reinstating your original, higher limit of coverage.

Finally, whether in good times or tough times, think about your neighbor, including your loved ones. Slow down, pick up your house or your yard, eat healthy and take a nice walk in the fresh air daily. This will not only reduce your chances of claims and higher insurance costs, but will help us all enjoy life to the fullest.

Alden Weichel, part of the team at Bradenton Insurance, can be reached at (941 748-0511.

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