Blog

Who Needs Life Insurance?

The only people that need life insurance are the ones that plan on dying one day………………………

There are select other groups that may not need life insurance:

–You have more than enough cash and assets to cover everything in the event of your “unexpected” passing. And…….

–You have no short-term and no long-term debts. And……

–You have no family obligations. And…..

–There’s no need for retirement for your spouse or college for your kids. And…..

………..the list can go on and on. The point being, virtually everyone needs some form of life insurance. Think about it–you buy every single other insurance hoping that you never have to use it. This one has a guaranteed payout!!

So it ultimately makes sense that if you’re going to put your time in to getting some life insurance, do it once and do it right so you don’t have to worry about it again.

If you’re not quite sure where you are with your life coverage, think maybe you’re just OK with what you got, or things have changed and your coverage hasn’t kept up–the worst thing that can happen is you get free policy review to tell you that your situation is fine.

Call us at Chu & Associates for all of your life insurance needs and questions. We are always happy to hear from you and happy to help!

Here We Go!

Welcome to the Chu & Associates Health Outlook Post! My name is Scott Demko. I look after all things health-related here at CA. I am taking it upon myself this year to regularly post information, explore topics, answer questions, and generally keep tabs on the ever-changing (sometimes daily) world that is health insurance. We’ll not only touch on health insurance for individuals and groups, but also look at subjects like Medicare, dental, vision, disability, and life.

The object of all of this is to create an information stream that can be used as reference or to help spur ideas for coverage that may be missing or lacking. Ideas and information will probably never be lacking.

Stay tuned…………………………………………….

Replacement Cost Value for Home Insurance

A question we are often asked relates to the Replacement Cost of their homes. “Why is the replacement cost so high when I just paid $XXX,XXX for my house?” No, the insurance companies aren’t out to get you.

The simple answer is that those figures have very little to do with one another. For insurance purposes, when we calculate the Replacement Cost of your home, we are using a calculator contracted by the insurance company and provided by a third party company: Marshall & Swift/Boeckh (MSB). The MSB values are calculated from statistical data that determines what the cost, based on labor & materials costs in your area, would be to haul away the debris and rebuild your house from the ground up. These figures assume that the home will be rebuilt in like kind and quality to your current abode. We enter additional features that would change the replacement cost of your home, such as custom built in cabinetry, detailed moldings, and higher quality materials used in the construction.

If your home were in someplace like California or New England, you might find that the replacement value is much less than the market value of your home. Here in the midwest, you see the opposite in most cases. The value of the land itself is not factored into this valuation, as the land would exist in that location regardless of the condition of the home.

Our policies are usually written for Replacement Cost or Replacement Cost Plus (which covers other factors that might increase the cost to rebuild your home, such as widespread damage that causes scarcity of available labor and materials). There are some circumstances in which we would consider an Actual Cost Value (ACV) replacement value for your house, but they are rare, as you get a depreciated settlement for damages. There is another type of valuation called “Functional Replacement Cost”. This is generally used for older homes. Maybe they currently have lath and horsehair plaster walls. Should something happen to the house, assuming there are no historical restoration obligations, the homeowner may choose to have the walls resurfaced with standard drywall and moldings rebuilt with poplar instead of the original oak. The house still *functions* the same, but was rebuilt with more modern and inexpensive materials.

In any case, at CA, we will use the information we collect to ensure that the limits on your insurance are adequate to protect your assets.