← Duologue with Leslie Heaney
Duologue with Leslie Heaney
The Insurance You Have v. The Insurance You Need with Julianna Obeid
01:16:00
Most people think they’re protected... until the day they find out they’re not. In this episode, Leslie sits down with Julianna Obeid of Alliant Insurance Services to explain how homeowners and families become dangerously underinsured, and what “re...
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- [00:03]
A
Hi, everybody. It's Leslie, and you're listening to Duologue. I am so thrilled about this next guest. I had no idea when I planned this episode how timely the topic would be and that so many Americans, myself included, would be filing insurance claims and needing expert guidance on insurance. Following Winter Storm Fern. In this episode, I have the privilege of speaking to one of the country's top private client insurance advisors, Juliana Obaid of Alliant Insurance Services. Juliana is a current board member of the Estate Planning Council of New York, and her career began in the interior design world, where she worked with designers like Mark Hampton and Peter Marino and the renowned design firm McMillan. Her love of beautiful houses and art really informs her work as an insurance broker today. And she loves working with her clients to shed transparency on the very opaque insurance industry, which is what this episode is really all about. In this conversation, Julie and I talk about the questions you need to ask your broker about your coverage and traps you don't want to fall into with your coverage. All that fine print, all the risks you need to plan for with your liability coverage, from monitoring your pool to ATVs to teenagers drinking. The list goes on and on to what steps you can take to reduce your premiums or to find a good broker. This episode really covers every single thing you need to know about how to protect your family and your property. I learned a ton from this episode, and I know you will, too. Well, Juliana, it's so nice to see you again for listeners. Juliana, this is her. We had a great conversation the other day, and I am out of the country and thought that I had better WI fi than I did. And so something happened with the recording. And she's so gracious and kind to do this the second time, number two, and during the New York City snowstorm, no less, which is, you know, really a very dedicated guest. So I want to just thank you so much for not just being on once, but. But being on twice.
- [02:03]
B
My pleasure, My pleasure. Same shirt.
- [02:06]
A
Well, I mean, by the way, I didn't even notice. That's really funny that you said that. So I think it might be helpful. Let's sort of take it from the top for listeners. Very sort of 30,000ft. What type of insurance should people have for just in general, primarily? I guess we should start with their homes.
- [02:26]
B
That's right. So you're going to want to home insurance. You're going to want a policy on your cars. You're going to want to have excess liability, which would cover all the members of the family in that house. And then you're going to want to have art and antiques. It's a good thing to have as well. So art, antiques, jewelry. So those are the, pretty much the four.
- [02:50]
A
And when you talk about house, is that house its replacement value and then contents are those two separate components of that policy.
- [02:58]
B
That's right. So I was, I have a 12 year old daughter who's doing algebra. So I always think about the house is X and the contents is 0.4x. So on a lot of typical policies, you know, you might see a million dollar house, typically the contents, a standard rate will be $400,000 which may or may not be enough. It depends if it's your primary house or if it's your ski house or a house in Florida where you know, all you keep are flip flops. So it, it starts off as something standard and your broker is allowed to tweak it if you have more or less things. And so that's where we really ask a lot of questions to people about if you, you know, if you shake your house, all of those things are considered content. Let me go back to the home first. Let me go back to the home. So on the home you can get, there's two kinds of coverage. There's named peril coverage which is not so great. Right. So we're only going to cover your house if these 12 things happen.
- [03:57]
A
So the name apparel is. We're only going to cover the replacement cost if it was a.
- [04:02]
B
That's right. If it was a fire, if it was a hailstorm, it was an aircraft or if it was an explosion, if it was a riot, if there was smoke or if there was vandalism, a volcano.
- [04:13]
A
Aircraft. Aircraft I never really thought of, but I guess that should be included. Yep.
- [04:17]
B
And so there are a couple of name things and then the, what we consider to be the more broad carriers offer an open peril or all peril policy which means unless we say it's not covered, it's covered. Right. And so you want to. What I like is, I like those policies. We like those policies at alliance and we look to get a house if the house is X. Right. So say your house to rebuild it is two and a half million dollars. You want to make sure that to replace it in 10 years you have a number that is appropriate. So it's either 150% of that number of X or the ideal is, or sometimes they'll say it's guaranteed, guaranteed rebuild. It depends on, on a lot of things where you're living. So they may not want to offer the unlimited. If you're living in Florida, they may say, we're going to offer you 150% in this state because the likelihood that they're going to have to do that is pretty high. So it's going to vary what you can get, but if that's something that you really want, you can surely try to get it.
- [05:25]
A
So how would that work? So let's say you have a policy on your house and you've moved to Connecticut or Florida, and then it's Covid, let's say. Right. And the value of your house has. Has gone up dramatically. I don't know if that really. That might just be what it would. What it would. You'd be able to get if you were to sell it. But I guess what I'm trying to get at is how diligent should you be about making sure that the value of your home that's listed on your policy is commensurate? Right. Yeah. With what the market is offering.
- [06:03]
B
I had a client that was in New York City that bought a beautiful townhouse for $35 million. The rebuild on it was closer to 10 or 15. The spread was the land. So if you live in Connecticut on the waterfront, and it's Covid and you're. And the sale, the value of the house goes up. It doesn't matter. It's really just the price to rebuild the house, and that's totally separate. It's what the cost of wood is, all of those things.
- [06:32]
A
And so, yeah, we were having the tariff stuff going on last year, and obviously that was maybe a moment in time. But I guess what I'm getting at is that that did affect sort of the costs of the raw materials. Right. So I guess something that you want to be diligent about. Right. If something is spiking, prices have gone up or something, maybe you sort of just want to kind of keep track of that and be in touch with your broker. Right.
- [06:59]
B
Or if you know a builder or you kind of know generally, you can say, hey, my house is probably 500 a square foot to rebuild. It's 3,000 square feet. What does that look like if I multiply that? You know, certain places are more or less. But I think it's important to always make sure. Now you probably, you know, you're unlikely to have a total loss. Right. So if your house to rebuild is $2 million, you may not need that entire 2 million. Right. You may have a fire and you only did $600,000. But it's. If you need it, you're going to want it, right? I mean, you're going to want to have it. So it's good to make sure. If it feels low, it probably is low. And I would call my broker and say, hey, what are the houses in my area? Square foot, you know, what do you think it costs?
- [07:48]
A
Well, it's funny, I mean, if we're going to sort of, you know, maybe have a personal anecdote, I feel like every time a contractor tells you it's going to be X and ends up being like, you know, one and a half times X or, you know, two times X. So maybe it's just good to kind of stay, you know, stay on top of it. And I think the other thing that I just have heard that sometimes, and this is why you're your broker so important too, is you want to make sure that you're. Whether, you know, some insurance carriers, from what I understand, will give you the money regardless whether or not. Whether or not you intend to rebuild. Like, some people might be like, you know, I actually don't want to rebuild there, because that's right. We're right near jail.
- [08:30]
B
Sensitive, right? Like, that was a really sensitive space. Right. And so that's also backing up. One of the things I say to people is that your insurance is a legal document to indemnify you in a certain way. It's very specific. And so if you wouldn't get your will off the Internet, why would you buy your insurance off the Internet? You know, and so. And so it is a promise. So, for example, some contracts will say, we'll replace things with similar materials. Well, if you have a very beautiful floor, they may not have to provide you that beautiful floor. They may say, we think the bamboo is similar enough. And so they're only going to give you a certain amount of money. Whereas other carriers, the legal definition is like, and kind quality. And they will say, oh, that was oak that was imported from France. Like, why don't you go and get your contractor to see if they can get the exact same thing or something you'd be happy with, because we're on the hook to cover it. We are. And so that's really where the rubber meets the road, is when you do have to replace things, how do they have to replace them? On a similar note, there's something in lesser policies called actual cash value, and that means the depreciated cost. So if you bought a sofa for one of your houses, Leslie, and you said, yeah, it's really beautiful, and it's. You know, I spent X amount. They might say, well, it's now used. We're only going to give you, like what it would sell for kind of. Right. A depreciated value. But if you had to go out and replace, wouldn't cost the depreciated amount. And what happened as a person I knew and was very close to a fire in Colorado.
- [10:15]
A
It did.
- [10:16]
B
The house didn't burn down, but it got so, so smoky that he said his daughter's Barbies smelled like cigars. And they had to throw everything, including bike helmets, because all the plastic was infused. And he said, you know, these are $150 bike helmets. And they gave me like 25 do. So essentially I'm like $2 million short.
- [10:40]
A
Right.
- [10:41]
B
Because of this legal fine print. And so he sued. Wasn't a client of mine, was a cpa. I know. And then had this whole exhaustive process and you would just rather say this happened, I need to replace these things. And the carrier says, sure, we're going to wire you money and then let us know as you keep going. And that's where the service comes in, I would say is some people go, ooh, carriers are so expensive. But if you've had a claim with some of these better carriers and they just, they give you money up front to replace things and then, you know, they. It is so traumatic when you have a severe loss and stressor on your family. When you lose your family home and your photographs, the least that you can do is to give them something to say. We're going to get you back to where you were. You're never going to get those photographs again, but we're going to rebuild your home. And that can be very meaningful for me as well.
- [11:41]
A
Yeah, I mean, for sure. And that's. I think it's such an important point. I also, when you said earlier, like, not that, you know, obviously everyone wants to make sure that they're paying, you know, a fair price and, you know, you as a broker want to make sure that, you know, your, your clients are being covered to the full extent, but also giving them, you know, making sure they're getting a, a fair premium. But sometimes you get what you're, what you pay for. Is what you were saying earlier. I think a little bit that you want to just ask questions or make sure you're asking questions. If it seems a little bit too good to be true, that it might actually be a little bit too good to be true. Okay. So, yes, I'm calling you, Julian. I've got this new house Love that
- [12:20]
B
it's a new build. I love, I hope it's a new build.
- [12:22]
A
Oh, okay. Maybe let's say it's an old build. New house is not a new build, but a new house that I bought. And I need your help guiding me through this insurance process. What kind of questions? Because I want listeners to think about what they should be thinking about. And I know you have this amazing risk assessment quiz on your firm's website, which I did. And it's really fascinating because there's so many things that were flagged for me that I had never thought about before, like how many times do you host parties and things like that, which we'll get into. But so I'm coming in or I'm calling you on the phone. Where do you start? What kind of questions do you ask me? Because I think it will sort of prompt, you know, questions for listeners too about kind of what they should be thinking about, making sure that they have coverage for sure.
- [13:12]
B
So we usually get the listing. We're going to look at everything from the if the roof looks old, we'll ask the client, say, hey, are you going to do any construction? Because if it's a large enough amount of construction, if they say we're ripping out, you know, we're doing a gut renovation or we're just sanding the floors,
- [13:30]
A
but it's going to be a million
- [13:30]
B
and a half dollars, we usually say, how much is that renovation going to be? And when we get the dollar amount that typically tips the scales and it'll indicate to us that it's a large enough project that it becomes a course of construction. And that is a like a 12 to 24 month separate policy because construction is just not covered. Large construction is not covered under a standard homeowner's policy because it's a totally different, very risky risk. And they're not unless you tell them they're doing it. That's not what you're, they're not expecting everybody to be doing that. They're just expecting you to move in, not be wielding, you know, chainsaws and, you know, blowtorches. So that I would say, hey, are you going to do any construction? When are you planning to move in? Are you going to rent it back? Some people do that. Is anybody going to be in the house, for example, in the winter? That's important. And so as an example, right now, right? It's January. Okay, great. You're buying this house. When are you planning to move in? Because you want to make sure somebody is there if there is a freeze. Right, right, right. So does this. Do you know if the current owners have an alarm, Know if there's a current water monitoring device? So if the temperature went down in the house, would anybody know? Right. So if the temperature goes to 30 degrees in the house, the water is probably going to freeze too. So you have a temperature monitor and then you also have a water device to measure the pressure for the water. So if the water pressure suddenly goes down, it means that there's a leak. And so that's really important. So do you have one of those? We'll ask things like, is there a pool? Because a pool and a cabana is part of what's called other structures. So you have your, your X and then you have. 20% of X is typically covered in other structures. And so I like to use my million dollar, you know.
- [15:32]
A
Wait, sorry, Julian, would you Repeat that again? 20% of X is in other structures. So you're saying your house, you want to insure for about 0.4. Well, that's 40,
- [15:43]
B
right?
- [15:43]
A
Yeah.
- [15:43]
B
So your house is whatever it is. Right. But then there's two other parts to the house, and that is contents and your other structures. So those you can play around with, make them higher or lower as needed. And other structures. Means we have a tennis court on our property. So I'll say, is it just the house? I see there's a two car garage next to it. So I want to know what else is on the property. And then I will ask after I've asked about sort of the alarm devices, making sure that they'll get. Sometimes people say, oh, we don't know about that. That water loss thing, is that something? And we say, yeah, it is. You can get a credit on your house. So water monitor, fire monitor, all those things you get credits for. And more and more, we are seeing that carriers are not asking you to put them in. They are saying within 30 days of us getting on this risk, they better be in. Like they have to be in. We need proof.
- [16:40]
A
So I come to you and I'm like, here's the house. Here's how much I bought it for. Here's, you know, what I'm going to be putting into it. Contents. You're going to say, okay, you've got your formula for that. Then I would talk about, let's say I love this fictional house. I have Juliana with the pool and the tennis court. I love the whole thing, the pool house. Then you've got your 20% for that. And then you might ask me like questions about Art or special belongings. You mentioned a piano earlier or jewelry or kind of walk through all those too. Right. With your clients, what else do you have? And then you'll sort of parse out for them. Is there any kind of rule of thumb with that coverage for that for art or for jewelry, Is it full replacement cost? Is it, you know, you mentioned, you know, if you have a piece of furniture that you bought new, the example of that family in Colorado, you probably could only resell it as like a used sofa. But if you were to replace it, it's going to cost you the cost that you know the price that it cost you to buy it.
- [17:41]
B
So that's right.
- [17:42]
A
So how do you, for jewelry and art, do you ask them to be appraised or how do you assess or should, should you do that to make sure that you're getting the full coverage amount that you need?
- [17:52]
B
Sure. So I should say like on the contents of a house, the contents is typically not lower than I would say $500,000 if it's your primary house. Because if you had to replace, you know, your teenagers makeup and your piano and every computer and every, every little itty bitty thing, it's probably going to be at least, you know, it's not going to be $10,000, it's going to be more. And so typically while some of things like jewelry and art there, there is space for them to be covered, you really don't want to cover them on the contents because they can be significantly higher. And in some policies with some carriers, they actually say there is a sub limit. Like there's only $5,000 for jewelry coverage on your contents. So you really want to carve that out as its own special item and say. And there's a couple of things. So it's furs, which I don't see a lot of anymore. Furs, firearms, like camera equipment. Although I worked with some very, some celebrity professional photographers and of course they had a lot of photography equipment. Are you like, if it's a piano,
- [19:03]
A
musical instruments, what about wine collections and things like that?
- [19:07]
B
Yes. And so wine is definitely one of those. If it's a large enough collection, you want to insure it on your own.
- [19:13]
A
I just have bottles of $25 a to z myself. But if you are in that category, that's something you definitely want to. Right. You want to, you want to make sure you disclose that and figure out how to properly. And that would now be part of contents or probably be a separate, it's a separate policy.
- [19:33]
B
And, and I would Say it's really good bang for the buck. I mean, you know, it's not as expensive as jewelry to ensure it's a lot less because a bottle of wine is not, you know, falling off your ear while you walk out or you're at the grocery store. It's in a pretty safe place. It stays at home usually. Right. And so as an asset, if you are, if you would get worried about losing it all, say the refrigerator or your underground cellar, like something happens and breaks, this will cover you for that. And we've had, you know, it does, it's not common, but I did have a friend who mentioned that her dad had a million dollars of wine in California and it was in the fires. And she said, oh, but I'll probably, you know, I'm sure it's just covered. And I said, well, probably not. Given it's with the certain carrier you mentioned, they're probably not going to give you a check for the million dollars of wine. Like it's gone. Yeah, it's gone. And so nobody plans for these things to happen.
- [20:33]
A
Right.
- [20:33]
B
It's your broker's job to ask you specific questions. And we have, we have a very disciplined approach. So we will ask you all these questions when you're buying this lovely house. Tell me about your wine, tell me about your jewelry, tell me about your art. Do you have any one piece bigger? Like do you have any one really big piece or do you have a lot of little pieces? Because that can be a lot of little pieces of art or jewelry can be put on what's called a blanket policy. And that is I have $25,000 worth of jewelry but no one item is more than $10,000.
- [21:08]
A
Right.
- [21:09]
B
And that's a nice way to just. And there's no deductible. So if you lose it, they don't. Or you know, if it. And also, you know, mysterious disappearance is covered on higher quality carriers, it doesn't necessarily have to be stolen, which is sort of the lower end carriers. But there's no deductible for art, there's no deductible for jewelry on these sort of specialized side policies which we call vac valuable articles collection. Yeah. And they even have handbags, you know.
- [21:38]
A
Oh yeah, yeah.
- [21:39]
B
I'm sure that's a new hot. You know, it's expensive, it's expensive. I mean, I worked with somebody, it was like so dollar for dollar, if you're going to insure a certain asset class, it's like it costs x to insure $200,000 worth of art. It's probably the best thing to insure.
- [21:58]
A
What about. So we talked about sort of specific examples or personal experiences. My family, we've been going to the same place for the summers and family's been living there for a long time in Bayhead, New Jersey, which was terribly affected by Hurricane Sandy. And not only was our. Everything around our house was destroyed, but I mean, it looked like a war zone. Houses were literally just obliterated and moved. And, and what was so shocking about it is that, you know, you had to prove that the damage was caused by wind in most cases, because the water damage, it was primarily water damage. Unfortunately for all the carriers, even the top carriers, from what I understand, they had like a maximum amount they would reimburse for water or flood damage. And it was up to, I want to say, $200,000. I mean, it wasn't close to what it would cost to replace the house. And so you have all these people who couldn't afford to rebuild their houses or couldn't afford to repair their houses or had to sue the insurance company to try to establish that in fact some of the damage was caused by wind and not water. How do people avoid. Do you really. This is again where your broker probably comes in, right? Really making sure that you're doing a deeper dive to understand what kind. Because I think people like your friend with the wine, you assume these things were covered. And as my old boss at my law firm used to say, assuming makes an asset of you and me. I used to be like, you know, I assumed and like, you know, but isn't. So that's something just a flag, right, to really think through all the possibles.
- [23:30]
B
Yeah. I mean, so we're sort of the 500, what do they call it? The 500 pound gorilla in the room. We're a very big broker, but I like to feel like we really get to know our clients. And so I would say it's important that. So we have a claim service within our private client team so that our clients can keep doing what they're doing. Because Nobody wants to call 1-866-DOLD for two hours. You want to get, you know, you're busy and you want to get your family taken care of. You want to be in a new house while your house is being repaired. So we have a team that does that, that triages and goes through. And sometimes it's a little gray. You're right. Is it, you know, is it storm surge? Is it hurricane? And sometimes it's, hey, you know, let's Work together to come out with a thoughtful solution because we don't want to really upset the client and the broker because this is a broker that sends us a lot of business. And so let's come together to help this person who needs help. So I think that's kind of like that's where a lot of good claims work can happen. And they are the angels in our firm navigating through. Look, you know, buy the book here is what it says. But I think one of the issues is, is it a like somebody. I was just looking online to see what the snowstorm. I think it's called, like snowstorm Greta. I was like, Greta, really?
- [24:55]
A
Oh, this one's Greta. Like the one that's happening right now?
- [24:58]
B
Yeah, I mean, there was a name. So all of the, there's hurricane coverage goes in if the National Weather Service says it reaches, you know, the wind is this. And so if it's not defined as a hurricane, then the hurricane deductible doesn't kick in. So there's all of that that goes into it and it is very nuanced. But I would say if you're in a flood zone, you can get excess flood. And so there's these. FEMA was created as really a policy of it's not for affluent people, but what has happened is that people have used it and it is a very basic coverage. And so we use a wrap to go and get excess flood. And the truth is that is that more than ever now, flood is happening in places where people didn't ever get floods.
- [25:52]
A
Right. I mean, that whole thing in North Carolina with Asheville, I mean, that was terrible, horrible. And who would have thought that that would have been in a place where water damage would have been the primary destructive force, Right?
- [26:04]
B
Yeah. So if you can get excess flood, it's going to make more sense if you have, you know, people have home theras. And sometimes like with Sandy, there was, for example, my. Our claims team, you know, there's coverage for backup of sewer and drain and there was backup of sewer and drain during that time. So we got coverage under that definition. But if you don't have a team like that that's digging through to find coverage for you, it may not end up so well because part of what you're buying is the service. Right? Right.
- [26:36]
A
Okay, so let's talk. So you, as I mentioned to you, I was absolutely fascinated by the questions that were on your, this, this liability quiz, your website. So I kind of want to like rapid fire, get explanations from you about why, why Are you asking some of these questions? Okay, first, I think I know some of the answers, but I want to hear what you know. I'm sure you are you high profile or affluent? Why does that matter? Right.
- [27:03]
B
So if you're a celebrity and you know, you are out to dinner at a very, as my teen daughter would say, bougie restaurant, or you get into an altercation, people just know that you might be affluent, you're in the news, you're more recognizable, somebody might want to do something. It's just the reality is that there's more litigation against those people than people who are not that kind of person. And so I don't have to really worry about that. I don't have to. They Google. I mean, I know that the carriers, when they get, you know, if you're not already somebody now, they say, you know, what's your occupation? And if you say like, you know, I something crazy, they may say like, we don't want to work with you because you're just too risky.
- [27:49]
A
Interesting. Thank goodness I have a growing podcast, and I don't think I'm in too much of risk, but who knows? Taking a quick break for a word from our sponsor, Cozy Earth. With Valentine's Day right around the corner, Cozy Earth makes it easy to show a little extra love this February, whether for yourself or someone else with their amazing pajama sets. The bamboo pajama set or the Sutton pajama set. I have pairs of both of these pajamas and they are incredible. The bamboo pajama set is lightweight and it's cozy. It also keeps you comfortable, cool while you sleep, which is perfect for ladies of a certain age like myself or just any of us who like a good night's sleep. They really do actually help you sleep a lot better. Then their Sutton pajama set is a little different. It's just this classic, beautiful design with subtle feminine details. They're really beautiful and give you a little piece of luxury whether you're home or on the go. But this Valentine season, Cozy Earth is offering a special day deal on these amazing pajamas from now until February 8th. So check out the bamboo and Sutton pajama collections@cozyearth.com and if you use the code duologbogo. So duolog b o g o, you get one pair. If you buy one for yourself, you can get your second pair free. So buy one for yourself and they get another pair free for someone that you love this Valentine's Day. And then if you're shopping for anything else on their amazing site, you still get your 20% off using the Duolog promo code at checkout. But what's super great about this Valentine's Day special offer from Cozy Earth is that it's risk free. So these PJs come with a 10 year warranty and a hundred night sleep trial. So if you don't love them as much as I do, you can always return them hassle free. But trust me, you will not want to. So with this amazing pajama offer, just in time for Valentine's Day, Cozy Earth is bringing bringing a little indulgence. You can slow down and savor this Valentine season. Celebrate everyday love with comfort that makes the little moments count with Cozy Earth. Okay, the second one though, I might be a bit at risk which. How many times do you host parties? Why does that matter?
- [30:02]
B
So that matters in terms of liability because you're letting people into your home. And so for example, if you're having a political fundraiser and you're having 250 people in your house, somebody could trip and fall and then decide to sue you because they know your house is incredible and they want you. They think you have deep pockets. So unfortunately, we live in a litigious sort of suing society. And if people know that you have money and there you, there they are in your house, they are more likely to blame you for that. And so it's not necessarily that you're going to get in big, big trouble. But you call your carrier, you say this happened and they may settle for a certain amount. They pay the medical fees, and most of these policies have a certain amount to cover the medical expenses so that that person doesn't feel like they actually have to sue you.
- [30:57]
A
What if you have a valet parker who hurts someone's car or a caterer that just something.
- [31:04]
B
So we had a situation where a caterer somehow was a little aggressive with somebody's guest, got a little too flirty, and the, and the person was very offended and then decided to sue the person having a huge party. I mean, I can't just.
- [31:21]
A
As an aside here, Juliana, I think the main takeaway here is be careful who's on your guest list. Really just invite your friends over. Not other, other people. But go ahead. Sorry.
- [31:32]
B
I mean, you're gonna be named in the suit. So even if it's like, you know, we called Susie's catering service or we called, you know, Bobby's valet service, they're gonna say, this happened to my car and I parked it at your house and I'm gonna name you because it was at your house, I'm gonna name you in the suit.
- [31:48]
A
And so should you be asking, should you be asking your caterer should be asking the valet parker, should you be asking the construction company, should you be asking the people that are doing work in your home whether they're insured 100%, yes.
- [32:02]
B
And I would say you're better off hiring a service that is insured. And then there are people coming to you then calling the young guy down the street and giving him a hundred bucks because that's sort of pennywise console us. Right, because he's my move, by the
- [32:18]
A
way, or my kids, who may be barely legal to, you know, to be serving or.
- [32:22]
B
Right. Because also if that person gets, if that person who's working gets hurt, then it's the company's workers comp and all that, that will kick. That kicks in. And you know, if you hire the kid down the road and he gets hurt parking a car, then it's, you know, then what are you going to do? He's going to say, oh, I broke my leg and you need to give, you know, so you really want to hire a company that has insurance. Yes.
- [32:47]
A
And if you're having a big event at your house, you know, you mentioned the construction, the 12 to 24 month coverage. You're hosting your child's wedding. Should you be getting an additional policy just for that event?
- [32:59]
B
So the event coverage can provide things like liquor liability if you need it, but it typically is more like, oh, I bought, you know, I spent $50,000, I spent $50,000 on these flowers. And, and my daughter's fiance just walked out on her and I need money back for those flowers. So I would say the event policies are really more targeted to money lost that you had spent for an event that was sud canceled that you would like to then have again.
- [33:29]
A
So you should contact your broker if you're having an event. I remember my husband was taking his final exam. He was in a summer session in business school. And the day of our rehearsal dinner and he was supposed to arrive at like 2 o' clock and it was 4 o'. Clock. And my father's like, you know, it's not too late to cancel the caterer. Like, I was so worried. He's coming. Please don't worry. So I guess these things do happen.
- [33:54]
B
And yeah, I would say, I would say there is. So there's liquor liability, there's are, there are other buffers that you can do if you're, you know, Leslie, I know you like to have parties on your Yacht. Yeah, yeah, Those kind of your white party. Yes, you can get those, but they're not typical. They're not typically done. And I would just. Don't have any more. Don't have 150 people in your house or just have them sign a waiver. No, I'm just kidding. But no, this is real.
- [34:23]
A
Okay, so here's. These are a couple others. We'll do rapid fire. Because this one I thought was interesting. One of the other things on the quiz was next to public land. Why does that matter?
- [34:34]
B
That's a good question. I think it's just because if people are on that land and they get injured and it's on sort of the
- [34:42]
A
border, it just could become, like, problematic. And then. Pool and pond.
- [34:47]
B
Right. So you and I talked a little bit about, like, here's kind of my stress situation. Three nannies come to a house, you're away, you have your nanny, and they're like, oh, we'll have all the babies, and they're by the pool. And, like, who's watching? You know, somebody. There's liability with a pool because obviously people can drown and. Or like, even if you can swim, if kids are drinking and they, hey, we're going to dive in, or something like that. There's a lot of things that are bad that can happen that way, too. Right. So there are more incidents where people have been sued around pools.
- [35:22]
A
Okay. And are there things you can do for your pool? Like, and I want to get to negligence a little bit later, but, like, you want to make sure that your pool is like. There is this great Curb youb Enthusiasm episode where a burglar breaks into Larry David's house, and as he's leaving the house running away, he falls in the pool and he drowns in the pool. And the police come to, like, investigate the robbery, and they're like, you don't have a pool fence. He's like, who needs a pool fence? So anyway, the whole thing became about his pool fence.
- [35:50]
B
And.
- [35:50]
A
And he's like, I'm going to get it. And the robbers brother. And it was a great episode. Was like, decided to shake him down and was like, listen, I'm not going to sue you over my brother who's the robber's death if you give my daughter a role in your next show. Anyway, it's so funny. But my point is there is, like, you know, to make sure that your insurance carrier is going to cover you. God forbid there is an incident. You need to make sure you've got a pool fence or whatever the Regulations are for your town.
- [36:18]
B
Right.
- [36:18]
A
Height. And, you know, you. Maybe there's a sign like, you know, you see these public pools or pools at hotels that say, no lifeguard on duty. Right. Is that giving them cover? You know, sort of COVID If that. Just that they're, if someone were to drown, that they're just getting notice that there's, you know, that they should be more cautious or, you know, the hotel or the homeowner is.
- [36:42]
B
Yeah, but let's go back to this new house that you bought. So the new house that you bought, the insurance carriers typically visit the house and they're going to look and see that you have that pool and they're going to say, oh, so they'll make recommendations. And I think at the end of the day, you want a carrier that is going to come to your house and see your things and say, you know, that painting is very close to the shower. Or gee, this monitor is broken or out of batteries or wow, like, something's wrong with the pool here and it's cracked. You really want to take good care of your house because it's actually. So we would know when we said, hey, is there anything on your property? And you would say a pool. And then they would know that when we submitted it for quotes that you had a pool because it would be as part of your other structures under property. So that would be disclosed already.
- [37:35]
A
What about. I'm sorry, I'm jumping around a bit, but I just. You made me think of it when you talked about alarms and then looking at what you have in your house. If you had a fire and you had a faulty, you weren't taking care of your fire alarm system. Like you weren't paying your, you know, ADT bill that was connected to that. Or, you know, the, the probably more likely you have the beep, you know, the beep, beep, beep. This has happened to me and like, I just can't take it. With a smoke alarm, you just, you know, you just dismantle it until you've replaced the battery or whatever. If you take. Took those steps and you were to have a house fire, can your carrier say. Obviously probably depends on the carrier. Like, we're not going to cover you because you proper alarm.
- [38:17]
B
It's called signal continuity.
- [38:19]
A
Right.
- [38:19]
B
And so, yes, so they want to make sure that that signal is good all the time. And so if you dismantle it, that would be, you know, somebody that's intent. That's intent. Yeah. It wasn't a mouse. It wasn't a mouse that took the battery out, it was you, somebody in the house, and you did it. And that is intentionally a breach of contract.
- [38:44]
A
Okay. Okay. So that, that'd be clear in your policy. People just. I mean, because I know I'm not alone in that. Like, you can't take the beeping. You dismantle it. You want to make sure that that's up and running, and you want to make sure that your, your ADT is all hooked up or whatever you have monitoring, whatever your, your policy requires, just to make sure you're covered.
- [39:02]
B
Yes. And I would say, like, I know that there are times when you're in the house and it's irritating, and if you're in the house, maybe it's okay, but like, certainly if you're going away for two weeks, you would make sure it works. I would say, I mean, I've taken them out of the carbon, you know, the CO2 things, or I cooked and set them off. But it's not a great idea to turn everything off. Okay.
- [39:22]
A
Yeah. So one of the questions too is if you have staff, so you have people working, if someone who comes to babysit, you know, often, or you have someone who helps to clean your house, or you have someone who helps with your lawn, they're there. They're. They're your. They work for you. Right. Or they work maybe for a service. Let's take. This is one of the questions. Why is that question asked? Did that staff member be part of your policy and named. Is that the reason?
- [39:50]
B
So that person could sue you? Right. We're thinking it's another person. It's another person who could sue because they tripped. There's a lot of tripping and falling in your house.
- [40:03]
A
We drink the wine at the pool party. Yeah.
- [40:06]
B
You've got some loose tiles by the pool.
- [40:08]
A
Yeah.
- [40:10]
B
All the usual stuff. Yes. And so what I would say is if you can have somebody be the employee of somebody else, great. You know, it is really. And this is going to something else. If you are paying somebody, there's like liability around paying somebody. If you are paying somebody to perform a service and they get injured in your. In your house, I would prefer they be an employee of a service, a lawn cutting service. But obviously if they get hurt on your property and it's their own fault, like a long time ago, this was horrible. Somebody lit. Put a lot of gasoline on a bunch of leaves and lit it on fire. This is horrible. And I couldn't even remember, Like, I just thought about it again and like, basically I had horrible burns because it didn't dawn on them like that was a bad idea. Right?
- [41:01]
A
Yeah.
- [41:01]
B
And so obviously was very, very injured. I think in that moment that person was a, an employee of an entity. But that wouldn't get like, it wouldn't be your fault, but they would sue you. And you would want to have legal defense. Right. So you would want to have sort of what we call error cover. You'd want to have a lawyer that's going to file documents in response to a lawsuit. And that's what the liability, excess liability does. Most of this stuff doesn't end up being that, you know, you're, it's not saying like you're a horrible person. You know, it's like you could get, you could get sued by somebody who worked for you and they're going to name you in a lawsuit. Whether they're, whether they worked for Polly's Cleaning Service or not. They're going to sue you and you're going to have to respond. You're going to have to have attorneys respond.
- [41:54]
A
I think what you're getting at or what I'm gleaning here is that these questions about, you know, public land, pool, pond staff. The next was drivers in 21 and probably fit in the same category. It's like these are things that are increasing your risk. You need to make sure that you have enough excess liability coverage because this is not part of your house contents replacement value. This is liability. And then the question probably becomes maybe that's where the high profile affluent comes in because you might have a higher risk of being sued. You know, if someone slips in my driveway, I don't know, they're going to get too excited. But you know, if I'm JLo, they might, you know, they might be.
- [42:34]
B
That's right. That's right. And so I mean, it's funny because I used to say I am sure what you can touch, but this is one thing where I say like, tell me how you live. Tell me about you. Are you hosting parties? How old are your kids? Who's driving your cars? Who's driving your cars? Well, actually we're planning to have my mother in law live with us. She's gonna, you know, there's a second house on the property. Okay, well, is she going to be driving one of your cars regularly? Because we should add her to your auto policy if so. And that is also because if she's on your auto policy, then she's automatically on your excess liability policy. So. So your mother in law, that's kind
- [43:14]
A
of covering her and it's Covering you too. And then the other question you had on a risk was about social networking. Why would that matter?
- [43:23]
B
Like the social networking is important. Yeah. Because anybody who is a minor is considered really the word of their parents. And so if there are things like social bullying and there's records of it and kids do things, the parents can get sued for the child's behavior. Right. And so once again, we're not saying that you're a bad person because your kid made a nasty comment about somebody else in high school, but the lawsuit certainly could happen.
- [43:51]
A
Right, I see.
- [43:52]
B
And you're an affluent person in that community. They're gonna say, yeah, you know, there's eight kids we're suing all of their parents for. And you know, and this is what happened. And our kid, you know, hurt themselves because of your kids. And so these are happening more often.
- [44:07]
A
Yeah.
- [44:08]
B
And. And as a result, it makes us, we need to move to where that, you know, we need to make sure we're addressing it. It didn't happen 50 years ago, it's happening more now. And so we need to make sure our clients are aware of it.
- [44:21]
A
Well, the next one other questions you ask is you engage in high risk activities and sort of along those same lines as it relates to kids. I'm thinking like skydiving or something, which I don't do. But, but you know, we lived in a farm in Millbrook and we had a Polaris and you know, our kids would drive it like when they were older with seatbelts and all that. And I would say to our friends whose kids were on it, like they drive safely or whatever. But there's a lot of cases. There was one I just read in the New York Post recently, where, you know, even if the parents of the children that are in the vehicle, whether it's an ATV or a jet Ski or whatever you have. Right. Say, oh, it's fine. Or even if they're there and they say it's fine, if there's an accident, you're the one who's liable regardless if it's on your property. Right.
- [45:11]
B
100. The idea that, oh, well, we don't get it, you know, it's not really licensed. It never leaves the property. It stays on our land. It never goes on a public road. Well, you're still going to get sued if some kid is, you know, your friend, your kid's friend tips over and gets injured 100%. And once again, this is sort of like goes back to that huge construction thing. You need to let your broker know that you have an ATV and make sure that it is covered on a policy. Because a lot of excess liability policies will say they may have an exclusion for an atv. If they don't know that you have one, they may exclude it or a boat.
- [45:53]
A
Right?
- [45:54]
B
So.
- [45:54]
A
So if you get anything new that could be like, you have your homeowners, you've got your excess liability, but then you just got two new ATVs, or you got a jet ski, or you got a broker, you got a right, you know, whatever, a motorcycle or, you know, it's actually like, should be part of anybody's excess liability. I'm kidding. But not really. Are those hoverboards? Because we got one of those things. It's like, really, you know, my husband almost broke his arm, another kid almost broke their leg. I mean, it's just. That's very, very high risk. Okay, so I guess the takeaway here is you need to be very communicative with your broker. First of all, you need to get a broker, which we'll get to later, but and really kind of walk through all these things that could tell them everything, like have them be your therapist. So that.
- [46:34]
B
That's right.
- [46:35]
A
Make sure that you're getting all the coverage that you need.
- [46:38]
B
And then I wanted to dig into something that you had mentioned a while back, which was that, you know, if I have alcohol with my kids, you know, there's this whole idea of oops, this happened. I didn't know. You know, and I think there's, there's oops, you know, we have a hoverboard or oops we have a, we have a this, we have a that or this happened. And stuff that's accidental is typically covered, right? Oh, we accidentally, you know, I hit somebody else in the grocery store, you know, with my, my carb tapped there. Oops. But if there's stuff that. Just because you have insurance doesn't mean you can be negligent. So if you have a keg in your house and you go out to dinner and there's a bunch of 16 year olds in your house, if something happened to a drunk, to a kid, like they were, they drank too much at your property and then went and left, and it's really found that you are very negligent, that you weren't even there, that you allowed alcohol consumption to take place, there may be limits on what they cover because it's not their permission to just behave. Number one, underage drinking is against the law in every state, Right. It depends sometimes on the state itself.
- [47:53]
A
Well, actually, what's crazy is we. I was in Austin looking at University of Austin with our daughter. We're walking on the street, and I. This is terrible. I was like, it's a shame you don't have your fake ID with you, because we could. I wanted to go look into one of these bars with a. With like a mechanical bowl for fun. And the bar. And the. The. The bouncer heard me. He's like, oh, no. In Texas, you can go into a bar with your parents if you're 18. I'm like, you've got to. Anyway, so some states, I guess Texas allows kids to drink if their parents. Actually, my daughter was drinking, it was about going into the bar. Although she did, I think, have something when we went into the bar when she was 18. But. But Texas allows that. Other states don't. But I do think that there's a real misconception among people. Like, I know several cases, you know, just anecdotally of people who, you know, had a party after graduation and had all the parents sign the waivers. Right. And so everybody knew they were drinking. But then if someone gets injured, it doesn't absolve that family from the liability just because they had a waiver, you know, because, as you pointed out, because the activity is illegal. Like, I think there's a.
- [48:59]
B
That's awesome, right? That's great, right? It's like, oh, yeah, well, you sign this so we can just walk out
- [49:04]
A
of the house, right?
- [49:05]
B
No, you can't. You know, you're still a parent.
- [49:08]
A
But even if they're there. Juliana, though, too, right? Even if you're home and this happens, it doesn't absolve you of the responsibility of injury.
- [49:16]
B
That's right. I mean, I think you're going to get coverage, but I think if you. But I think it's going to vary to some degree. So, you know, so you might get
- [49:25]
A
covered if you are home. It really depends on your worries.
- [49:29]
B
I think it depends on, like, how bad you've been. Yeah, I think so. You know, they do have a duty to defend you, but you can't do anything willful. You know, you can't intentionally, hey, I'm going to get them drunk. You know, if you don't want to get. You don't want to be in the gray area. You know, you really don't.
- [49:48]
A
So what about, like, you know, we talked about exposure of hosting parties, and we just talked about teenagers drinking in houses. Are there other examples that you have of. Of. Of carriers not covering people because of negligence? We talked about the. The Smoke alarm thing, right? Like you dismantle it.
- [50:08]
B
Yeah, yeah.
- [50:08]
A
What if you, like, left a candle burning, you know, or any other ones. People should just be mindful of that they may not have thought of that would put them at risk of not being covered.
- [50:21]
B
You know, it's funny, I don't think so, but I was going to say, like, yeah, if you have a candle and you left it in your house and it burned, I mean, that's. That's a legal thing to do. Right. You're legally allowed to light a candle. That's just dumb. But that's not against the law. And so if there were a situation, obviously insurance carriers, if they have the law on their side, they can say, we're not going to cover this claim. And here's why, you know, because we have the law on their side. So it is going to vary state by state, as you mentioned. And some carriers will say, hey, let's find a way to find the coverage. Let's figure this out. But you don't want to be complicit in all of this. Right. And so as a parent, and just say, hey, you know, I've got insurance. Let me just kind of go crazy. Let my kids do whatever they want. And then, of course, construction, I would say, you can't do a huge renovation. And then say, oh, you know, something happened in our house. I've had that. Where somebody didn't tell us they were doing a huge construction project and then had a nail. They went away while people were finishing work, and the person put a nail in the top floor of a townhouse and it leaked all the way down to the brand new. The whole house was destroyed. And amazingly, look, this was a while ago. This was like 2012. I'll never forget it. The carrier said, look, if you retroactively pay for a construction policy, we will pay the claim. I don't know why they did that for us. It was, like, beyond incredible. They said, this is obviously construction site. If you retroactively. That was a unique, you know, and part of example.
- [52:08]
A
Yeah, right. Where like, you really need to get that construction insurance because you could have. And also in the case of like a New York City apartment, or if you're an apartment building anywhere, or any kind of town home or anything that's connected to someone else. Right. If there's construction, your construction damages someone else's apartment, apartment, townhome, you're gonna. You're gonna be on the hook.
- [52:31]
B
That's right. I mean, the biggest cause of loss that we see in cities and just in general it's water loss, you know, from a leaky toilet or oh, and it damaged here. It's, you know, oh, I damaged the downstairs or the three floors downstairs. And you know, people have nice things and then suddenly you're not replacing like, you know, it's not a $2,000 claims. It's a lot bigger thing. It's a really. Because you mess somebody's fancy wallpaper and their fancy rug and suddenly you're on the hook for hundreds of thousands of dollars.
- [53:03]
A
Okay, so let's talk about. You mentioned like having those water monitors, right. Or things that could help reduce your insurance premiums. What other. Maybe a newer roof was something else that you said. What other examples do you have there?
- [53:20]
B
So I feel like every carrier, every, every year it's like a different, you know, it's like so we're going to do this this year. They're like roofs are a really hot topic. We really don't want any roof that's older than 15 years, you know. And so knowing the carriers I think is so important and what they're looking for because sometimes people are with a carrier that kind of like is not that interested in their business in a way. And so they're looking for, they're looking for you to take care of your home. So they're looking for a house with no claims. So don't put in small claims. Do not put in small claims. $2,000, $3,000, $4,000, $5,000.
- [54:01]
A
Okay, you want to have a premium
- [54:03]
B
100% so you want, you know, a higher deductible. You know, you want a 5,000 or 10,000 people take $50,000 deductibles on a big, big homes and it's really now more what we call catastrophic coverage and then your liability. Right. Because obviously most of our clients, their home insurer is also their liability insurer and we don't want them to have. What has happened is that people get non renewed for many small claims and then they have to go find a whole new. And then you're like, it's almost like defaulting on a credit card. You know, once you get there, your, your interest rate gets really high and you get expense and it's very expensive. So you really don't want to be that person. You want to have, you want to take care of your roof. You want to make sure you have water loss devices, any sort of maybe a backup generator. When we hear about, when we hear people say like oh yeah, we just put in all new pipes two Years ago. It's like, it's like the hottest thing that people could say to me. It's like.
- [55:11]
A
So, yes, you're very excited about new pipes.
- [55:14]
B
You're like, yeah, wiring. That's right.
- [55:17]
A
I am all about plumbing.
- [55:18]
B
I am all about plumbing. Because you can buy that house and it could have a beautiful new kitchen, but they didn't spend the money to redo the pipes. And six months later you have a water loss.
- [55:31]
A
I know very close friend who redid her kitchen and there was a leak. And the. In the. Somehow in the. Whatever the.
- [55:38]
B
Oh, that hurts.
- [55:39]
A
The pipe is that connects to the like the water in your refrigerator and it was leaking in the wall and the entire kitchen anyway, had to be.
- [55:50]
B
So, yeah. So we also like what we call these water bugs or tags. And in apartments, because you cannot control the units, what you're seeing more is the in. In apartment buildings all over the United States, there are. There's a move to put water monitoring within the entire building. So that is happening as we speak with a number of companies. And they will have a contract with a building because these older buildings, they just leak all the time. And it's as one of our carriers says, you go from a. You go, instead of having a move out, you just mop it up. Right. And so they should be on your, on your washing machine. 100%. All these appliances, you know, they can leak and leak onto the floors. And I heard, I've heard stories of toilets where some, you know, a little kid will put a toy in the toilet, you know, the rubber ducky and he's swimming and then it's like an $80,000 water loss.
- [56:50]
A
Yeah. So I love that you get excited about new pipes. This is, this is very exciting now. So I want to, you know, we talked about sort of ways to reduce the premiums. Are there any other hacks or strategies to combine your coverage? Like, you know, people, if they do have more than one home or. A question I had for you is like excess liability. Should your excess liability also cover your cars or who's driving?
- [57:15]
B
So typically what you have, you have everything with, ideally with one carrier. But I always say, show me all your cards, like I need to read the tea leaves. So you cannot just put your bad risk. It's not just your home on the coast that we're going to insure. And then it's like, oh, but I have this super non risky house, you know, in Nashville that is neither near hurricane territory, like, that's a great location. And so it creates a like except
- [57:42]
A
for right now when it's in the middle of an ice storm and has no power.
- [57:45]
B
That's right. Other than that. But we call it in finance they talk about a barbell on bonds. I spent some time in finance and it's sort of a balanced way to have short term and long term bonds. And then in insurance speak, the way I would say it is you have a risky asset and a non risky asset and you put them together and you get a moderate risk. And that's what carriers are looking for. So they may, they may not always, like not always in Florida. They may say, ooh, you have a house in like I did a house in Arizona and a house in New York recently because we're national. Oh, that's great. We'd like that. We're actually going to give you a better rate on Arizona and do the house in, you know, and so it like, oh, that's so interesting. And then, and then we got a credit, you get, you know, a credit for having all of it, which, and then the autos.
- [58:38]
A
Is this when they say like you can bundle your car insurance. Is that like Geico, whatever that commercial is. But It's.
- [58:43]
B
We're not 15 minutes.
- [58:45]
A
Yeah, exactly. But you, but the idea of right there, the carrier is excited, getting two different properties. Right? To two different.
- [58:52]
B
Right, exactly.
- [58:54]
A
Yeah. And so by doing that and having their risk reduced, you're able to get better premiums.
- [58:59]
B
Okay, that's right. And also not to be nerdy, but if you have primary liability on two premises, so say you have Nashville and Arizona and Your underlying is $300,000 of liability on 1 and 500,000 of liability on. And you have a excess liability that requires 500,000. You'd have a gap in your Arizona policy because there would be a gap between 300,000 and 500. So we talk about a gap in insurance which is like way too detailed for this. But you want to make sure that when you have your house liability that your, your umbrella hits right there, that your excess liability just right there. Because you don't want to have a part where nobody's touching it because your, your excess liability sinks down to X. It'll say we need a required underlying limit of blah, blah, blah, blah, blah on your house. And you need to make sure that all of your houses have that number. And so it's nice to have one broker saying that house in Hawaii, that house in Texas and that house in Florida are all in sync.
- [60:08]
A
Now what about people? I mean there are many, many people who are listening who do not have the, the two homes or the, you know, what worked like, you know, in that kind of higher affluent category of, you know, some of the clients that you, you have a lot of. How do people, you know, get their one home? And they're looking to protect their home and they're looking to get some liability insurance because they're having a bar, they have barbecues in the summer, and they, you know, want to make sure that their contents are covered and their teenage drivers. How do they go first? I guess make sure they're getting the right coverage. But and also, I guess what my takeaway from our conversation really is the real importance of having a good broker. How does someone find a broker? A good broker? And how can you tell who is a good broker? Like, what are the questions people should be asking to find out or looking at to know whether or not they are really having someone thoughtfully assess, you know, their particular portfolio to make sure that they're getting the coverage that they need?
- [61:11]
B
It's a great question. I would just say how many markets do you have? You know, because I think some, there's direct writers and then there's independent agents. So we as a firm are not obligated to only represent one carrier. And so I think it's important to have a couple of flavors so that you can find more than one option. Because obviously one company that only represents that option, that's it. I mean, that's it.
- [61:42]
A
And so there might be a broker who's like, I'm a broker. But they really. It would almost be like if you were buying a car or something. Like, you know, I'm a car salesman, but I only sell Fords. Right. I mean, maybe it's a bad analogy, I don't know. But yes, 100 do is to make sure getting the best deal on the car that you need, need, or in our case, what we're talking about, the insurance that you need. You know, a good indicator is like, are. Do they represent more than one carrier?
- [62:10]
B
I think so. I think it's important. Do you have a claims team? How do you handle claims? Do I have to call if I have a claim, you know, or do I call you guys? How are claims handled? How many clients, like, how many clients does the person.
- [62:23]
A
Who's.
- [62:24]
B
Who am I going to be talking with when I buy a new car? Who is that person going to be? So in our team, we have a very specific chain of sort of. We have a new business analyst because our underwriters have new business underwriters and we Sort of match the way some of the carriers are. So once somebody's been sort of settled after six months, they roll to a regular day to day person. Because obviously if I'm out having coffee with a financial advisor, I'm not necessarily the best person to call to be like, hey, we need to replace our windshield. Right. And so there are all these things that have to go on and you need to make sure that they have capacity to handle a claim. Or when you're like, hey, this feels high, you know, you want them to say, yeah, we'll remarket your account. Let's take a look at some other, you know, some other carriers, even something like as an example, when you have a claim it usually lasts sort of three to five years on your, on your reports historically. So say you had a $300,000 water loss in one of your homes last year. We'd need a lot of data to make sure that was remediated and it's done before we went and got a new carrier for you. So you might want to say like, you know, just sometimes we just tell people don't put in a claim. Right. And we say we're the first call. So I think claims is important and just that they're really advice driven and they know that you, they know like, hey, if you have a 16 year old kid and that kid's going to be getting, you know, their license soon, should I be, you know, you want them to, to be proactive about that, right? Hey, maybe you need to go from a $1 million personal liability to three. Right. So things like that. And I do think having teenage drivers is the biggest concern.
- [64:18]
A
Right.
- [64:18]
B
So 100% have an umbrella if you don't have, have a personal liability if you don't have, you know, if you have a car and you're driving. We do. And then if you have kids, you may need to revisit it.
- [64:33]
A
Okay, that's, that's a good point. So we talked about earlier like kind of being in touch with your broker, you know, having your broker kind of, you know, full open kimono, the broker knows everything. And then when your kids become older and they're driving now, you know, your broker's obviously not, maybe they're getting your Christmas, they can kind of follow. But it really is up to you to be open and communicating with your broker. Like hey, now I have two teenage drivers. You know, should, how should I increase my, my excess liability?
- [65:00]
B
That's right. And so like some brokers will send a policy, hey, are you planning any construction Any new drivers in the house? Are you looking at acquiring new property soon? Are you looking at selling? And, you know, we have an annual, sort of like some people meet with their wealth advisor every year and they kind of go through some stuff and it's the same, it really should be the same on insurance. Okay, right.
- [65:24]
A
And this is something like if people are listening and they just. I've never used a broker. I've always, you know, called. I called State Farm or I saw the ad or I used to love the State Farm ad because the guy that did it was the, was the president from the show 24. What the heck was his name? Anyway, I love that. I, I, I, if I was watching that, I'm like State Farms on my side because I love this guy so much. But let's say that's what you did as opposed to calling a broker. I think people might be intimidated by calling brokers. You know, brokers don't. Maybe I'm wrong about this, but I don't think brokers. You don't pay your broker. Right. It's almost like a real estate agent. Meaning the broker is working with the carrier.
- [66:03]
B
They're embedded in a fee.
- [66:04]
A
Yeah, yeah.
- [66:05]
B
And so, yeah, their fees are negotiated. Our senior team does that negotiation with carriers. I'm just here to, I'm just here to help clients.
- [66:16]
A
So people should not be intimidated by calling. I guess that's what I'm saying to calling a broker and like vetting brokers and, you know, make taking that step because, you know, it just seems. I interviewed someone last year, talked a lot about, you know, sort of the, the issues with different coverage in different states because of, you know, a lot of people are being dropped by their carriers because they're in flood zones like Florida or they're in California and the fires. And, you know, his advice was get a good broker. Like, that was the biggest takeaway, you know, because making sure, and I think in some cases also making sure you have a broker, you're not just, you know, just going in cold because you like the guy. So President Warner, I'm going to remember his name anyway, the guy from 24, he was selling State Farm. But, but just calling, vetting brokers, you gave that great advice about making sure they represent more than one carrier and then just, you know, making sure that you feel like they're really asking you a bunch of questions about how you're, how you live your life and, you know, all the kind of risks we've talked about today to kind of think through and make sure. That you're covered. Yeah.
- [67:21]
B
And I think, you know, sort of what's your process? What's your onboarding process? Because it's on them. It's on them to be asking you and to catch this stuff. You know, it's like going to a doctor. It's not your job to catch your skin cancer. You go there so they catch it.
- [67:39]
A
So you're.
- [67:40]
B
It's not your job. They're supposed to ask you the questions, you know, oh, you have a boat. How big is it? Is it bigger than this? Okay, where does it go? Oh, you're planning, you know, construction or. Oh, tell me about that home. It has a pool. It has a second, you know, structure. Okay. Or oh, you have a son. Okay. Is he, is he licensed or is he not licensed? Oh, he's in college.
- [68:00]
A
Oh, wait, your son's driving the car and the ATV and the boat?
- [68:03]
B
Maybe.
- [68:03]
A
I don't know.
- [68:04]
B
Right. Who's using that? And so it's their job to ask those questions. I mean, you're paying them a fee. It is their job. And I do think it is not unreasonable to expect them to do that kind of stuff. Well, I know what's enough liability? Will you tell me? And I don't think it has to be matching your net worth. I think if, you know, if you have a high net worth and you don't own a car and, you know, you have no kids and you're not married, it might be really different.
- [68:38]
A
And you're not having white parties on your boat. Right. Or, you know.
- [68:41]
B
Right. I mean, yeah, you know, how much damage are you going to do? And so I think our excess liability program shows you a bandwidth. So we'll have to get you on board again so you can do it because It'll say between 5 and 10 million. Between 10 and 25 million. So that, you know, sort of. Okay, well, I definitely need to bump it up. I might not need to bump it up that much. But here's where is a feel good number. This is sort of in the middle.
- [69:11]
A
And that's also, I think trying to determine what liability you're comfortable with might just also depend on what your risk tolerance is. Right. In addition to, you know, whether or not you, you know, engage in like insurance level risky behavior, whether you're exactly smoke alarm or whatever else is you're up to. But, but also like, you know, if you're really, you know, want to just kind of COVID everything under the sun with your liability, maybe you're paying more than someone who just kind of wants to be a little bit less cautious.
- [69:44]
B
So yeah. And I mean there's all sorts of, you know, there's. I go in without bias and I'll say, you know, oh, do you have staff? Okay, I'm no bias. Like on the books, off the book. Just need to know. And maybe you want to get a part time workers comp policy if they get injured on your property. If somebody works less than 40 hours a week, you're not legally obligated to get workers comp. But I usually, I think it, it's helpful if you do have somebody and you pay them through a payroll company. Typically those companies have coverage. If you do have a full time employee. I think you get workers compared to comp. And there are some other things that you can get if you have employees. Because this is the personal stuff is not meant to cover your business. Right. And when you have an employee in your house, it's a business. Right. So you have to have workers comp. Employment practices. Liability insurance is important to have too in case they, for whatever reason the nanny sues you or something like that. We have stuff where former nannies come and visit and the dog bites them and stuff like, you know, a chauffeur hurt their head polishing a car. We've had, I had somebody in Nantucket this summer that hit a deer on the road but was okay. Bikers who accidentally bike into other people. That happened. And so it's not always like my most recent issue was that some sort of H vac, it blew back into the apartment and just left dust everywhere and they needed to go just leave the house. And they had small, small children. They were worried about the air that everybody was breathing. And we just said, our claims team said look, go get the air monitored. If you need to leave the house, you know, in a hotel, let us know. Save every receipt and then followed up until the air was monitored. And so just like, you know, like I said, when you do have a claim, you will know if you have good insurance. So because they're either there to hold your hand or not.
- [71:48]
A
And your broker is really there to help you, to help kind of guide you through understanding again all the possible risks here, you know, what kind of coverage you need like for replacement and for contents and also just to let you know kind of what sort of hand holding you may or may not get based on the carrier or the policy. You know.
- [72:07]
B
Sure.
- [72:08]
A
Walking through that.
- [72:09]
B
And for example, like I much more so, you know, we typically have to offer some carriers. Like in California you offer Earthquake coverage so that you can offer flood coverage so that we know, okay, if you don't take a policy, that's fine, but we gave you the option, so you know what you have. You don't have to insure all of your jewelry. You can definitely schedule some blanket. Some not insure at all. But know what you have so that you're not living, like, in a state where you're not well informed. We just want people to make informed decisions.
- [72:47]
A
Right. Or end up at a place where you're, you know, like your friend with the wine and the fire, you know, just surprised that things are not covered. Well, Juliana, I mean, I could talk to you all day. I mean, we could go, like, from the white party to the pool pavilion.
- [73:00]
B
I mean. Oh, yeah, and we remember the last thing is don't be careful about renting your house out. We talked about that.
- [73:07]
A
Like, oh, right, with Airbnb.
- [73:09]
B
No Airbnb, because you don't know you could be renting it to somebody wild. That is not doing good things in your house. I mean, so if you start to rent out your house, it's not necessarily covered. So let your carrier, you know, hey, we're looking at renting our house out for two weeks. Are we covered?
- [73:28]
A
Oh, really?
- [73:29]
B
Good point. Okay, so just. That one's another one, too, because I know a lot of people do that. So just.
- [73:35]
A
And if you were to do that, would you then just get. You'd have to just talk to your carrier about seeing whether you are covered. If you're going to rent it for more than two weeks, like, you might need some additional coverage.
- [73:45]
B
Right? I mean, it might be like, hey, it's rented to a family and, you know, like, your house in Connecticut, we're renting it out to a family or we're. We bought this house, we're renting it back to the owners for six months. Okay, fine. That happens a lot in real estate transactions. That's not a weird thing. But, like, if we're renting it out every week for 52 weeks, you know, your carrier may not actually insure the house so that if you're. If suddenly somebody smokes a cigarette in that second house and burns it down, your carrier may go, oh, wait, what? That's like a rental house. You were renting it out on Airbnb. We didn't know that. Yeah, right. They can have cause to deny a claim. So just make sure that that's all out there. And talk to your broker, too. Yeah, it was really fun. I love it. I love talking to people.
- [74:34]
A
I can't wait to call you when I get the new house and I have the new pipes because I can't wait to see your reaction when I
- [74:39]
B
go to the White Party. You're my first call for sure.
- [74:43]
A
Thank you so much. It was so great to see you. That brings us to the end of this episode of Duolog. A huge thank you to Juliana Obaid for joining. I learned a ton from Juliana. I hope that you did too. Subscribers the Duologue newsletter will have the opportunity for a private question and answer with Juliana next week, where you can ask all of your pressing insurance questions. To learn more about how to join that conference conversation or to subscribe to the newsletter, check out our website dualogpod.com or follow us on Instagram at Dualog Pod A big shout out to you to our sponsor Cozy Earth. Cozy Earth is offering a special offer on their amazing Bamboo and Sutton pajama sets up until February 8th, just in time for Valentine's Day. So go check them out in our website@cozyearth.com and don't forget to use the promo code Duologue Bogo. That's Dualogue B O G O at checkout. When you enter that promo code, you'll get a second set of pajamas free. So buy one pair of the bamboo set and pajama sets. Use that promo code, you get the second one free. And if you enjoyed this episode, please rate or review us on Apple Podcasts, Spotify or wherever you get your podcasts. We have a new episode coming your way next Wednesday, so until then, this is Leslie and thanks for listening to Duolog.