Assuring Asset Protection (6th in the “Post D – as in Divorce – Day” Series)

Sandy Balick of Consensus Point Mediation, LLC (www.consensuspointmediation.com) discusses home insurance considerations.This post is part of a series of items of interest to the newly divorced in terms of personal financial security. You don’t have to be divorced, of course, or have any special occasion to undertake a personal financial review. These reviews are usually thought of in the context of stocks and bonds, but there are other components to the personal security picture and insurance is a key one. The last post touched on health insurance – this time we move on to other valuable insurance protections.

Insurance for your household (sold as renter, co-op, condo and homeowner policies) may be especially important. Coverage can vary considerably but these policies will usually ensure against significant causes of property loss and damage (e.g., fire) and property theft.

Household policies usually have two important protections:

  • Liability (up to a limit, of course):

Asset protection is especially important for those who have accumulated a lot of personal property and/or have significant assets that might be attached to pay for a liability judgment. To protect against personal liabilities that are beyond the limits of your basic coverage, it is important to check out what are referred to as umbrella or personal catastrophe policies. These generally fill the gap between your existing coverage and the higher exposures you might encounter in a liability judgment. These policies tend to be inexpensive relative to the underlying policies, especially when viewed in light of the extra protection they offer.

  • Defense Costs (what it would cost to have a lawyer defend you):

Many nuisance suits or exaggerated claims are filed with the courts. Your lawyer will often be able to get these claims dismissed, or if not, negotiate payments that are relatively small when compared to the cost of the legal assistance. Where larger exposures are concerned, a vigorous defense is important and the savings in legal expenses, including such things as expert witnesses, may be considerable.

Insurance brokers are the ones usually best suited to outline your options and associated costs. Some insurance representatives work for a particular insurer, but most brokers represent multiple carriers and offer to find you the best coverage at the best possible price. Still, it pays to investigate different options, including online offerings.

Always inquire about the actual insuring company’s financial rating, which is easily available. Be leery of any insurance where the broker or insurer cannot provide this information to you. Best’s is one of the most commonly referenced rating guides in the insurance industry. There may be reasons to take less, but a rating of A or better is preferred.

Another important piece of information that some easy internet research may also reveal is whether the insurer (also called “carrier”) has a good name when it comes to paying claims promptly.

Feel free to ask any questions, to comment, or to request more information in the Comments Box below. Also, please feel free to forward this blog to anyone you know who might be interested in its topic.

Sanford (Sandy) Balick, Attorney & Mediator, NY Sandy Balick signature
Sanford E. Balick, Esq.
Founder & Principal Mediator
Consensus Point Mediation, LLC.

Phone: (646) 340-3434
Email: ConsensusPointLLC@gmail.com
www.ConsensusPointmediation.com
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