Beware these 5 insurance traps

ConectUS can help you.

If you smoke like a chimney, you're going to pay more for life insurance. If you wreck your car, your auto premiums are going to soar. If you live on the edge of a wildfire-prone forest, you'll pay a lot more for homeowners insurance than someone in the suburbs.

All these situations make sense to us consumers. Greater risks, bigger premiums.

But insurers also care about other, seemingly obscure stuff: How you give birth, what you have in your backyard, what breed of dog you own, whether you max out your credit cards and how well your brain works.

If you don't know about these concerns, you may find yourself getting turned down for coverage or paying a lot more than you expect. A little knowledge can help you prepare and find a policy you can afford.

Here's what you need to know about:

Caesarian sections

If you're not covered by an employer plan and you're trying to buy an individual health insurance policy, you'll typically pay more for maternity benefits, which help cover the costs of carrying and bearing a child.

But maternity coverage may be more expensive, or not available at all, if you've had a child by Caesarian section.

C-sections typically cost insurers nearly $3,000 more than vaginal deliveries, and a woman who's had a Caesarian delivery in the past is more likely to have one in the future. Some insurers refuse to provide maternity benefits to such women, while others charge them more for coverage.

How much of an issue this is depends on where you live and on your individual circumstances.

For example, a woman in her early 40s may be deemed at low risk of having another child and offered a policy with a premium that's 25% to 50% higher than what she would have paid without having had a previous C-section, says Amir Mostafaie, a training manager for ConectUS who is a licensed agent in all 3 states.

"If she's in her 20s or 30s, there's generally a higher chance she'll get pregnant again," Mostafaie says. "She may be issued a policy with exclusions" so that maternity coverage isn't included.

Where you live can also have a profound effect on your options.

In "guaranteed issue" states -- New York, New Jersey and Washington -- insurers aren't allowed to cherry-pick their risks or charge more for things like previous C-sections, Mostafaie says. In other states, insurers have few restrictions on what they can do.

"If you're turned down, you might not have other options," Mostafaie says.

If you're in the market for individual health coverage and this issue affects you, consider working with an experienced insurance broker familiar with various insurers' policies. You don't want to risk being turned down for coverage, as that can be a red flag for other insurers, so it's best to find out in advance which companies may penalize you.

Trampolines

Kids love them, but many insurers don't. Some will charge a higher rate to cover the increased liability for injuries, while others won't cover you at all.

"Even with the proper safety measures in place, trampolines are considered a big risk and account for more injuries requiring emergency-room treatment than backyard swimming pools do," says Loretta Worters, spokeswoman for the Insurance Information Institute, a trade group. "On average, trampoline accidents run about $300 million annually in medical, legal and insurance expenses."

One of my readers bought a trampoline, complete with surround frame and safety netting, as a birthday present for one of her children. She didn't think to mention it to her insurer. When she switched insurance companies a few months later, the new insurer sent out an agent to take pictures of the property.

"Someone from the company saw the trampoline in one of the pictures from the agent," she wrote. To keep the coverage, "we had to take down the trampoline and write that we would not put it up on the property as long as they insured it."

Some insurers will cover a trampoline as long as it's inside a locked fence, to prevent unsupervised children from playing. Others will issue a policy that excludes coverage for injuries from the trampoline.

"Trampolines are what's considered an attractive nuisance, something that invites trespassers," Worters says. "No matter what precautions are taken, there is the possibility that a court case will find the owner of the trampoline guilty of negligence, even if the homeowner posts signs or takes preventative measures."

If you're considering buying a trampoline, ask your insurer about its coverage policies first. But also consider the recommendation of the American Academy of Pediatricians, which has long advised against trampolines.

"Despite all currently available measures to prevent injury, the potential for serious injury while using a trampoline remains," the academy says. "The need for supervision and trained personnel at all times makes home use extremely unwise."

'Bad' dogs

As I wrote in "Your dog's bite could bankrupt you," insurers are increasingly concerned about the rising costs of dog-bite claims. (Dog bites now make up one-third of all homeowner liability claims, and the average cost was $24,511 in 2007, up 28% in five years.) Some insurers have blacklisted certain breeds, such as pit bulls. Others will cover any dog until it bites, and then you could lose your coverage, pay more for it or be forced to sign a waiver that excludes any further damage done by the animal.

Insurers don't necessarily make these policies clear upfront. If you're shopping for homeowners coverage, make it clear you own a dog and what breed it is so you don't wind up getting canceled later. Before adding any dog to your household, call your insurer. Consider getting a different breed, or a different insurer, if the two are incompatible.

Bad credit

In most states, insurers that provide homeowners and auto policies are allowed to consider your credit history when deciding whether to issue or renew a policy, as well as how much to charge. (California and Massachusetts, which both ban the use of so-called insurance scoring, are among the exceptions.)

Why should credit matter to insurers? Several studies, including an influential one by the Texas Department of Insurance, show a strong link between consumers' credit scores and their propensity to file insurance claims. The worse their scores, in other words, the more likely they are to cost their insurers money.

Unfortunately, credit scores don't differentiate between folks who refuse to pay their bills and those who simply can't because of job loss, medical problems or a subprime mortgage they can't handle.

That's why some consumer advocates have pushed insurance regulators to suspend or restrict insurers' ability to use credit information, especially as the economy deteriorates. So far, the advocates haven't had much success.

If you've had credit problems, you should shop around for insurance, as not all insurers use credit information. You also should do what you can to improve your credit, such as paying bills on time and not using more than 30% of your available credit limits.

Mental-health problems

If you've ever taken antidepressants, seen a therapist or been treated for an addiction, you may pay more for life insurance. If your problems are serious or ongoing, you may have to search hard to find a policy at all.

Bipolar disorder, ongoing treatment for substance abuse or a history of suicide attempts can make you tough to insure, says Byron Udell, president and CEO of Accuquote, an online insurance broker.

Other problems may be less of an obstacle, particularly as time passes. If you were treated 10 or 20 years ago for substance abuse and have remained clean, for example, you may not get an insurer's best rates, but you won't be turned down just because of your history.

And some "situational" problems may not cause your rates to rise at all, Udell says. If you were treated for depression after divorce or the death of a spouse, for instance, and are fully recovered, "most companies would view this as a nonissue."

You might be tempted to conceal your troubles and hope your insurer doesn't find out. That's playing with fire. If your insurer discovers your history by, say, talking to your doctors or reviewing your prescription history, it could decide you committed fraud and either cancel your policy (if you're still alive) or refuse to pay out its proceeds (if it conducts the investigation after your death).

"Anything you lie about, if it's material enough to affect their underwriting, that's grounds for fraud," Udell says. "If you lie, you may think you have coverage, but maybe you don't have it. It's better to tell the truth."

Here's another area where having an experienced insurance agent can be an enormous help. The agent should know which insurers are most receptive to applicants with mental-health issues and will be able to advocate for you.

Liz Pulliam Weston's latest book, "Easy Money: How to Simplify Your Finances and Get What You Want Out of Life," is now available. Columns by Weston, the Web's most-read personal-finance writer and winner of the 2007 Clarion Award for online journalism, appear every Monday and Thursday, exclusively on MSN Money.

Pet Safety Travel Tips

Pet's can now be insured for free! Call 805-480-4888 for more information

Pet Safety Travel Tips

For many people, pets aren't just companions; they're important members of the family. So, it's not surprising that more and more people choose to travel with their pets. To ensure your pet has a safe and happy car ride, here are a few important travel tips from pet expert Andrea Arden.

Before You Hit The Road

Look for services that cater to pet owners.
Pet-friendly hotels make it easier than ever to bring pets with you on the road. Many offer amenities such as pet sitting, dog walking and even pet-pampering spa treatments. Do research ahead of time to find the perfect hotel that fits your needs. Be sure to ask about their policies — for instance, many hotels require your pet to be on a leash at all times and never be left unattended in the room.

Also, check with your car insurance company to see if your pets are covered. With Progressive's Pet Injury coverage, your dog and cats are covered — at no extra charge — if they're hurt in a car accident and your Progressive policy has Collision coverage.

Get your pets used to the car and make them feel comfortable.
Often, the only time pets ride in the car is when they're visiting the vet or groomer — so they may not always associate a car ride with positive feelings and may even be afraid to ride in the car. Teach them instead that car rides can be fun by taking them for short road trips to a dog park, a friend's house for a play date, or just to a new place to take a long walk.

If your pet's anxiety persists, consider over-the-counter products that can help reduce stress and anxiety.

If you plan to keep your pet in a travel crate while riding in the car, it's important that you familiarize your pet with its crate by having it rest inside the crate around the house — the more familiar pets are with their surroundings, the more comfortable and secure they'll be once inside the car.

Some pets tend to get car sick. Try not to feed them for a few of hours before the trip.

Make sure your pet has proper identification.
Just in case he or she gets lost while traveling, you want to be sure your pet is wearing up-to-date ID tags. The most important thing that needs to be listed on the tag is an emergency contact phone number, but it's also a good idea to mention if you'll offer a reward if someone returns your pet to you or if your pet needs any medication.

Prepare a doggie bag.
A pet travel pack is a great way to make sure you're prepared for anything — and is something that can remain stocked, so it's ready to go with you at a moment's notice. Make sure it contains cleanup supplies, a towel or bed to serve as a comfortable resting place, portable feeding/watering bowls, food and water, a pet first aid kit, and lots and lots of toys to keep pets busy and well behaved!

To Keep Tails Wagging in the Passenger Seat

Restrain your pets for safe car travel.
Free to paw their way around the car, unrestrained pets can be a distraction to drivers and can get injured if the car makes a sudden stop or is involved in an accident, even if it's just a fender bender. Secure your pet in a crate or with a harness to keep it safe.

Don't let your pets ride with their heads out of the window.
While most dogs love to hang their heads out of the car window and feel the wind in their fur, it's best not to indulge them. They can easily be injured by debris flying into their eyes.

Never leave your pets unsupervised in the car.
Just like people, dogs and cats are susceptible to heat stroke — even if it isn't that hot outside or the car windows are left open — and can even be stolen. Make sure you know where your pet is at all times.

About Andrea Arden
Andrea Arden has written five books, including "Dog Friendly Dog Training" (Wiley, 2007), "Train Your Dog the Lazy Way" (Macmillan, 1999) and "The Little Book of Dog Tricks" (IDG, 2002). She has also been the behavior columnist for Dog Fancy and The New York Dog magazines, as well as a contributing writer for the AKC Gazette and numerous other publications.

Andrea is the proud parent of four dogs, two cats and a horse.

Pet-friendly Travel Sites:

petfriendlytravel.com

travelpets.com

pettravel.com

petswelcome.com

Farmers Insurance Responds Immediately to Lakeview Terrace Fires

Farmers Insurance Group of Companies(R) agents and claims teams are moving into the Lakeview Terrace fire areas in Los Angeles to begin helping customers who may have been evacuated or have suffered damage to their homes.

"We ask that all of our customers and anyone in the path of these fires to evacuate and make sure they are out of the fire's path," Bill Matlock, Farmers State Executive Director asks. "Once you have moved out into a safe evacuation center or other location, please call the Farmers hotline at:

Call ConectUS Insurance Services for all your local Los Angeles and Ventura country insurance needs.

1-800-HelpPoint (1-800-435-7764) for immediate assistance.

Foremost Insurance customers should file their claim by calling: 1-800-527-3907.

"We will reach our customers as quickly as possible to give them the help that they need, but ask everyone to please listen to fire officials and media to get to a safe area and then call Farmers," Matlock said.

Farmers Group, Inc. is a wholly owned subsidiary of Zurich Financial Services, an insurance-based financial services provider with a global network of subsidiaries and offices in North America and Europe as well as in Asia Pacific, Latin America and other markets. Farmers(R) is the nation's third-largest Personal Lines Property & Casualty insurance group. Property and casualty products are underwritten and issued by the Farmers Exchanges and their subsidiaries, which Farmers Group, Inc. manages but does not own. Headquartered in Los Angeles, Farmers insurers provide Homeowners, Auto, Business, Life insurance and financial services to more than 10 million households.

SOURCE: Farmers Insurance Group

Farmers Insurance Group
Jerry Davies, 213-400-4459
jerry.davies@farmersinsurance.com

What is insurance?

Insurance, in law and economics, is a form of risk management primarily used to hedge against the risk of a contingent loss. Insurance is defined as the equitable transfer of the risk of a loss, from one entity to another, in exchange for a premium, and can be thought of a guaranteed small loss to prevent a large, possibly devastating large loss. An insurer is a company selling the insurance. The insurance rate is a factor used to determine the amount, called the premium, to be charged for a certain amount of insurance coverage. Risk management, the practice of appraising and controlling risk, has evolved as a discrete field of study and practice.

Learn more about insurance here

Small Business Owners Unfamiliar with Risks Involved in Workers' Compensation Insurance from Self-Insured Groups

Small business owners are not fully aware of the financial risks involved in obtaining workers' compensation insurance through self-insured groups, according to the results of the most recent Small Business Opinion Poll conducted by Opinion Research Corporation (ORC) of Princeton, N.J.

Of the 501 small business owners and managers surveyed nationwide, 85% reported they had not seen, read, or heard about the closure of several self-insured groups over the past year. Seven such trusts failed this year in New York, and litigation continues in the financial failures of self-insured groups in Tennessee, Kentucky and California.

Over one half (58%) of the small business survey respondents reported they are unaware that companies belonging to self-insured groups remain financially responsible--often for years--for the claims of all companies in their group, not just their own businesses.

Only a third (34%) of respondents realize they could be legally and financially responsible for the entire costs of workers' compensation claims owed by their self-insured group.

Yet more than a quarter (27%) of small businesspeople taking the survey agreed that saving money up front on workers' compensation insurance premiums outweighs the financial risks posed by membership in a self-insured group.

"Hard-working small business owners understandably keep an eye on the cost of their workers' compensation insurance. However, they also need to be fully aware of the risk they are taking when they elect a self-insured group over a strong private carrier. There can be a costly difference between the two. A small business belonging to a self-insured group may find itself on the hook for the financial obligations arising from other members' claims," explained Martin J. Welch, President and Chief Operating Officer for EMPLOYERS, the Reno, Nev.-based group of insurance companies which commissioned the survey. Welch added that, "Private, traditionally structured insurance carriers assume financial responsibility for policyholders' claims, and strategically position themselves and their policyholders to benefit from effective loss control, fraud prevention, and other critical customer services."

Among the possible financial dangers associated with self-insurance are: failure of the largest company in the group, successive years with serious injuries, and the responsibility for paying out claims for up to five years--even if a small business leaves a group. Self-insured group members also assume "joint and several liability," sharing liability among members on a pro-rata basis. For example, in a worst case scenario, a small business which pays 8% of the contributions to the trust set up to pay injured workers would, if the trust develops a deficit, be liable for 8% of all injured workers payments for the life of their claims.

Failures among self-insured groups in at least four states over the past decade remain in the news as litigation involving underfunded groups in New York, California, Tennessee and Kentucky continues to work its way through regulatory channels and state court systems.

In New York, the default earlier this year of seven self-insured trusts with an estimated $363 million in unfunded liabilities forced the state's Workers' Compensation Board to begin assessing self-insured group members for payments to continue protecting injured workers. Among those faced with the burden of covering self-insured groups' shortfalls are members of the Healthcare Industry Trust of New York, Public Entity Trust of New York, Trade Industry Workers Compensation Trust for Manufacturers, and others. Before the collapse, members of these self-insured groups had been receiving 20% discounts over rates charged by traditional carriers, and 20-30% dividends--basically premium refunds. The assessments are the subject of continuing litigation in New York state courts. In order to protect against additional self-insurance group shortfalls, the state currently has in effect a moratorium on the establishment of new self-insured groups.

California's insurance market saw more than two dozen workers' compensation companies fail as the market tightened in 2002, but has witnessed recent regrowth in the number of self-insured groups. In the past three years, the number of California's self-insured groups has jumped from five to 29, each now overseen by the state's Department of Industrial Relations.

The self-insured group serving the Tennessee Restaurant Association earlier this year was forced to cover a $4.8 million shortfall in a workers' compensation fund that the state alleged was mismanaged. More than 560 restaurateurs across Tennessee were ordered by a judge in January to pay money to bolster the self-insurance group's trust fund. Regulators alleged that the entity formed to run the trust received excessive administrative fees and dipped into reserves without authorization.

In Kentucky, members of the failed self-insured group AIK Comp were ordered to pay a $90.7 million assessment ordered by the Franklin Circuit Court. State regulators were forced to take over the failed AIK Comp group in 2004 when a net worth deficit resulted from group officials undercharging members for premiums to cover claims. The court gave members 60 days to pay 80 percent of their $90.7 million assessment to cover the group's net work deficit and pay injured workers for their claims. Member businesses unable to pay were charged monthly interest and also were liable for the cost of collection efforts, including attorneys' fees.

The ORC survey, commissioned by EMPLOYERS, America's small business insurance specialist, sampled 501 owners or managers of small businesses with 1-99 employees. Data was collected through telephone interviews during the period August 14-22, 2008, and results have a +/- 4.8% margin of error. The sample is stratified across business size and industry grouping. More than half of survey results were drawn from businesses with 19 or fewer employees in manufacturing/construction, transportation/ communication, wholesale/retail, financial services, or personal/professional services businesses.

Copyright (C) 2008 EMPLOYERS. All rights reserved. EMPLOYERS and America's small business insurance specialist. are registered trademarks of Employers Insurance Company of Nevada. Workers' compensation insurance and services are offered through Employers Insurance Company of Nevada and Employers Compensation Insurance Company. Coverage is not available in all jurisdictions.

SOURCE: EMPLOYERS(R)

EMPLOYERS(R), Reno
Trish White, Director, Corporate Communications
775-327-2636
twhite@employers.com
www.employers.com

Fed loans to banks, brokers, AIG totals $410 bln

Commercial banks, investment banks and American International Group borrowed a record $410 billion from the Federal Reserve as of Wednesday, the Fed reported Thursday. AIG borrowed $61.2 billion, the investment banks and broker-dealers borrowed $146.6 billion, and commercial banks borrowed $49.5 billion, the Fed said. In addition, banks have tapped $152.1 billion to buy asset-backed commercial paper from money market mutual funds.

Farmers Insurance Warns: During Economic Upheaval Don't Just Monitor Your Investments

source : www.farmers.com

With economic uncertainly and unprecedented economic upheaval in the country's financial markets, Farmers Insurance Group of Companies(R) warns now is the time to be vigilant and monitor your credit along with your investments.

"There is unprecedented uncertainty concerning institutions that have your personal information from home mortgage payments to credit cards and that is a red flag warning for everyone to monitor their credit reports regularly," explains Jeff Dailey, Farmers President of Personal Lines.

"Everyone is watching their investments, but we all must guard against troubled institutions abandoning identity information that could lead to a lot of unnecessary hardship for individuals already reeling from the economic downturn. Mortgage brokers that have/had your data that are no longer in business; or they are sharing it with institutions that bought them, means it is a good time to order your end of the year credit report."

Dailey offers the following ABCs of protecting your identity.

Always be alert.

• Check your credit report at least yearly and look for any suspicious items.
• Monitor your yearly Social Security Earnings Statement.
• Look over all financial statements and bills at least every month.

Be careful.

• Do not give out personal information over the phone or internet to someone that calls you.
• Do not carry your Social Security card in your purse or wallet.
• Be sure to use and update virus and firewall protection on your computers.

Contact immediately.

• Any creditors that you suspect fraud may have occurred.
• The credit bureaus to report any fraud and place a fraud alert.
• Law enforcement to document the fraud.

"Since Identity Theft is the fastest growing crime in the world today, Farmers insurance has developed comprehensive identity theft coverage. Farmers Identity Shield helps you restore your identity after an identity fraud. Those who have experienced its devastating effects know how hard it is to fix and how much time it takes," Dailey added.

Dailey explained that Identity Shield includes a 24/7 advocate to guide and assist victims. An expert also is on call to answer any questions policyholders may have about children or adult identity theft. "There is much more, including assistance in replacing lost, stolen or damaged identification documents and prevention tips," Dailey said.

For more information on identity theft and how to prevent it, contact your local Farmers agent