sept 2020 Insurance Newsletter

What Is the Difference Between Replacement
Cost and Market Value?

Moving into a new home you purchased or rented is exciting, but with that excitement comes decisions on homeowners and renters insurance. One crucial decision when signing up for that insurance policy is whether you will select replacement cost of lost or damaged items or market value. In the case of homeowners insurance, this can apply to the structure as well. While some may think that replacement cost and market value are similar, these two terms are actually very different and can result in different obligations for you should the worst happen.

Replacement cost:this term refers to the cost of replacing the item itself. For example, if your home is destroyed by a hurricane and is uninhabitable, your policy will replace the structure and contents of the home subject to policy limits. Although this provides the maximum benefit to the policyholder, it may not be right for everyone, given the probability that the payments on the policy will be higher.

Market value:this term refers to what the value on the open market would be to replace the home and/or its contents. For example, if you bought your home for $300,000, but market conditions have deteriorated and it is worth only $250,000, your policy would only cover the lesser current value subject to policy limits. That means you would have to either make up the difference yourself or build a less expensive home.

No matter what policy questions you have, we are here to help. Call or email us today, and we can guide you through the best options for you. *Note 99.9% of all our insureds have Full replacement cost on their home!

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The Connection between Dancing and Brain HealthDancing has long been embraced as a perfect way to keep the body physically fit, but you may be surprised to learn that dancing improves brain health.

A recent study by Frontiers in Human Neuroscience upholds that dance is better than a traditional workout when it comes to slowing down the signs of aging in the brain. That's because the kinetic artform is so much more than just shimmying and shaking. You've got to remember the dance steps, execute turns to a beat, recognize the rhythm and synchronize with a partner, all of which keep your brain active, engaged and on its toes, so to speak!

Another study published in the New England Journal of Medicine found that out of a range of different exercises, dancing was the only activity to offer protection against dementia, reducing risk by a staggering 76 percent. "Dancing regularly improves neuroplasticity by causing the brain to continuously rewire its neural pathways," says Dr. Robert Katzman.

A University of Illinois, Chicago study involving a Latin ballroom dance program for older adults found improvements in memory, attention and focus, and a similar program for seniors experiencing mild cognitive impairment reported improved thinking and memory after the 10-month program concluded.

To top it all off, dancing boasts other benefits, like improved mood, better posture and balance, and effective stress management. Since September 19 is National Dance Day, why not blow off some steam, get your limbs moving and keep the old brainbox buzzing with an impromptu salsa, hustle or twist and shout?

5 Common Myths about Lightning Safety

Lightning is not a force to be trifled with. You may be surprised to discover that much of what we think about lightning isn't true. Below are five common myths about lightning along with the facts to keep you safer.

Myth 1: Without rain clouds, lightning can't exist.Lightning can strike miles away from visible rain clouds. Although not as frequent, lightning bolts have been recorded to strike as far as 10 miles outside the area of their clouds of origin.

Myth 2: During a thunderstorm, sheltering under a tree is safer than no shelter at all.Trees, especially large ones, are often magnets for lightning, making this course of action more dangerous than no shelter at all. The safest thing during a lightning storm is to go home or duck into a shop or restaurant.

Myth 3: Lightning never strikes twice in the same place.This myth might encourage someone to return to where lightning struck so they will not be hit by lightning. The Empire State Building is often hit multiple times by a single lightning storm.

Myth 4: Lie flat on the ground during a lightning storm to avoid being hit by lightning or electrocuted.Lightning can generate currents in all directions. Lying flat on the ground provides more potential points to be hit by electrical currents if lightning strikes the ground.

Myth 5: Lightning will only strike the tallest buildings and objects.Lightning can strike anywhere and injure anyone. The safest thing to do when lightning begins to strike is to seek shelter in a home or building and avoid any outside-leading conducting paths, such as wires, metal window frames and electrical appliances.

Standard homeowners insurance and the comprehensive portion of your auto policy covers property damage from lightning (for example, fires). But if you have any questions about this, please give us a call. We are always here to help make sure your home and family are protected and safe.

Tackle Money Matters as a Team with These Tips

As married couples move into their prime earning and spending years together, they may find shared finances a challenging and sometimes uncomfortable subject to broach. But top financial advisers recommend tackling money matters as a well-oiled team as an exercise in full disclosure, trust and financial security. Here's how proactive pairs pull it off.

Fair is a feeling, not a fact.A fair way of handling the monthly bills is not necessarily a 50/50 split. As long as both parties are comfortable, then a proportional split based on income is the right way to go. You could also factor in unpaid work like childcare duties or housework.

Debt discussions.While you are not legally responsible for your significant other's debt, it'll go a long way in reaching your shared financial goals if you tackle it together. This doesn't always mean taking it on yourself, but you could address how much each person contributes to shared expenses, based on debt repayments.

Money talks.Couples who check in regularly are able to review bills, budget and make progress on debts and goals. Why not set aside an hour each month for a standing meeting to get a handle on what has worked and what hasn't? You could also add a positive incentive by ordering pizza afterwards.

Plan ahead.Planning for doomsday scenarios may not sound like fun, but it is important to support each other during end-of-life arrangements. On the brighter side, you should plan how you would spend a windfall like an inheritance, bonus or property sale. A good rule of thumb is 70 percent on savings, 20 percent on debts and 10 percent on lifestyle upgrades.