Personal Insurance

Capstone Group Welcomes Ed Stefanski, Jr.

For Immediate Release:


Capstone Group, a leading provider of risk management, employee benefits, and insurance brokerage services, has announced the hiring of Ed Stefanski, Jr. as a Senior Benefits Consultant.

For the past 15+ years, Ed has held various positions within some of the most respected Employee Benefits and Banking institutions in the country. Ed’s diverse experience in these areas, coupled with his consultative approach to creating and implementing cost-effective employee benefit programs, makes him an invaluable asset to Capstone’s current and prospective corporate clients.

“Our management team has known Ed for a long time, both personally and professionally,” said Kevin Fox, Managing Partner of Capstone Group. “His prior experience in various aspects of our business was certainly appealing, but it’s more our shared client-centric approach and desire to continue improving the insurance and benefits distribution model for employers and employees alike that really makes Ed a tremendous addition to the Capstone team.”

Ed joins Capstone Group to partner with employers on navigating rising healthcare costs and changing regulations. He brings expertise in financial analysis, health and welfare benefits consulting, and negotiation and risk reduction. He also specializes in the integration of new benefit programs and technology platforms to ensure seamless delivery for administrators and employees.

Current status of self-driving cars in the U.S.

(Bloomberg) — Existing U.S. laws pose few barriers to adoption of autonomous vehicle technology so long as cars and trucks stick with existing designs allowing humans to take control, the agency overseeing traffic safety said Friday.

It’s only when manufacturers push the envelope by developing vehicles without such things as traditional steering wheels and brake pedals that regulations may block new autonomous technology, according to a report released by the National Highway Traffic Safety Administration.

NHTSA issued the report in a briefing on its efforts to speed the adoption of driverless cars and other technology that assists human operators. It was produced by the John A. Volpe National Transportation Systems Center, which does research for the Transportation Department.

“There are certain designs for which there are relatively few current regulatory obstacles,” Gordon Trowbridge, a spokesman for NHTSA, said at the briefing. “That means that we need operational guidance, model state policy, out there to help guide the operation and deployment of vehicles that may be relatively close to the road.”

State laws

The Volpe study looked at existing federal motor vehicle safety standards and whether those laws will impede the introduction of self-driving technologies. It didn’t examine state laws, which govern driver qualifications, insurance requirements, and other issues. 

In an update to U.S. efforts to promote autonomous vehicle technology, Trowbridge said NHTSA was planning pilot programs across the country to test vehicles, working with states on developing new model laws, and evaluating federal regulations for what changes may be required.

The agency is also hosting two forums in April to gather public input on the issue, one in Washington and another at an undetermined location in California, he said.

‘A revolution’

“We are witnessing a revolution in auto technology that has the potential to save thousands of lives,” Transportation Secretary Anthony Foxx said in a press release Friday. “In order to achieve that potential, we need to establish guidelines for manufacturers that clearly outline how we expect automated vehicles to function — not only safely, but more safely — on our roads.”

President Barack Obama wants to spend $3.9 billion on autonomous vehicle technology over the next 10 years, according to his administration’s proposed 2017 budget.

Adding more automated safety features to cars is one strategy to reduce roadway deaths, Mark Rosekind, NHTSA’s administrator, said Thursday at a safety forum. The technology can help correct for human error, which the agency estimates is a factor in 94% of fatal car crashes, Rosekind said.

Traditional manufacturers and technology upstarts including are rushing to develop more autonomous cars.

Snowy conditions

Daimler AG this year unveiled a new flagship Mercedes-Benz E-Class that can steer itself in auto-pilot mode, brake in emergencies, and evade obstructions. Ford Motor Co. has announced plans to test autonomous vehicles for better reaction to snowy conditions, one of the major technical hurdles.

Tesla Motors Inc.’s chief executive officer, billionaire Elon Musk, says it’s technically feasible that its electric cars will be capable of driving autonomously across the U.S. within two to three years. Google Inc. operates perhaps the best-known fleet of self-driving cars, and Apple Inc. is presumed to be working on its own models.

In February 2014 NHTSA also promised to move forward with regulations that will require cars to be able to communicate with each other to avoid crashes. So-called vehicle-to-vehicle communications may in the future save lives on the scale of earlier safety innovations like seat belts and air bags, the agency said.

Read more here.

Study shows renters pay more for auto insurance than homeowners

According to an analysis of premiums by the Washington, D.C.-based Consumer Federation of America (CFA), major auto insurance companies are charging good drivers as much as 47% more for basic liability Auto insurance if they don’t own their home.

Based on a sampling of insurance quotes across the country for a 30-year old safe driver, the CFA found that premiums averaged 7% higher — about $112 per year — for drivers who rent instead of own homes. Liberty Mutual penalized renters the most with premium hikes averaging $307 a year, or 19% more, for state-mandated auto insurance coverage.

Auto insurance companies’ use of homeownership status in pricing disadvantages low- and moderate-income Americans, the CFA said.  Federal Reserve Board data show that the median income of renters in the U.S. was $27,800 in 2013 compared with $63,400 for homeowners.

“To raise people’s Auto insurance premium because they can’t afford to buy their homes unfairly discriminates against lower-income drivers,” said J. Robert Hunter, CFA’s insurance director and the former insurance commissioner of Texas. “A good driver is a good driver, whether she rents or owns her home.  Insurance companies should not be allowed to target people based on homeownership status.”

The insurance industry, however, disagrees.

“The Consumer Federation of America provides ample evidence in its own study that homeowners have better loss experience than renters and that insurance companies are justified in giving them a discount,” said James Lynch, chief actuary of the New York City-based Insurance Information Institute.

“In cities all across the United States, a wide variety of insurance companies have each looked at their own proprietary data sets and independently reached the same conclusion — that homeowners have better loss experience and thus it’s only fair they get a break on rates,” Lynch said. “Each company independently submitted its analysis to insurance departments across the country, all of which verified each analysis by approving the rates each of these companies filed. And every time insurers tweak their classification plans, they once again test and prove that the discount is valid, and the insurance departments that approve these adjustments re-verify the validity of the discount.”

What CFA found:

For the analysis, the CFA said it tested rates for minimum limits liability coverage in 10 cities from the nation’s largest insurers — State Farm, Geico, Allstate, Progressive, Farmers, Liberty Mutual and Nationwide. 

The nonprofit said it used company websites to solicit two premiums in each city for a 30-year old female motorist who has a 2005 Honda Civic and a perfect driving record. The only characteristic that was altered during the testing was whether she owned or rented her home.

While the average increase for renters was 6%, there were several double-digit percentage increases around the country. For example, Allstate charged renters in Tampa 19% more than it charged homeowners; Liberty Mutual charged Baltimore renters 23% more and 26% more in Newark; and Farmers Insurance charged renters in Louisville 47% more (or $768) than homeowners for a basic Auto insurance policy.

Geico was the only company tested that did not consider homeownership status in any of the 10 cities. The only premium decrease for renters was found in Chicago, where Allstate lowered rates by 11% compared with premiums for homeowners.

Below are tables showing the annual premium changes in total dollars and percentage by company in each of the 10 cities:

The CFA said it is calling on state insurance commissioners and lawmakers to prohibit insurance companies from penalizing good drivers based on their status as renters. 

According to CFA, homeownership status is a method by which insurance companies assess customers’ income rather than driving risk and should not be used as a factor in determining premiums.

“Virtually every state requires drivers to buy insurance, but we shouldn’t force them to buy a home in order to get the best price. State insurance commissioners and elected representatives should step in and stop this practice,” said CFA's Hunter.

Read more here.

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How to prevent frozen pipes

Frozen pipes can present an invisible threat – one that you might not recognize until the weather starts to warm. By then, the water damage can be significant and costly. Fortunately, keeping your home warmer, at a consistent temperature, and better insulated can help protect your pipes from freezing this winter.

Which Pipes Are Most at Risk?

Pipes that are most exposed to the elements, including those outdoors and along the exterior walls of your home, may need extra protection during winter months. These include the following:

  • Outdoor hose hookups and faucets.
  • Swimming pool supply lines.
  • Lawn sprinkler lines.
  • Water pipes in unheated, interior locations such as basements, crawl spaces, attics, garages and kitchen and bathroom cabinets.
  • Pipes running against exterior walls with little or no insulation.

How to Help Prevent Frozen Pipes

Before winter:

  • Check your home for areas where water pipes are located in unheated or poorly insulated areas. Be sure to check your basement, attic, crawl space, garage and within cabinets containing plumbing. Hot and cold water pipes should both be insulated.
  • Products such as pipe sleeves or UL-listed heat tape or heat cable can help insulate or heat exposed water pipes.

During winter:

  • Close inside valves supplying water to outdoor faucets and hookups.
  • Open outdoor faucets to allow residual water to drain; be sure to keep them open during the cold weather months, while the water supply is turned off.
  • Keep garage doors closed to help protect water pipes located in the garage.
  • Open the doors on cabinets where plumbing is located. This can help allow warmer air to circulate around the pipes.
  • For pipes that are at risk of freezing (both hot and cold water pipes), let water drip from faucets.
  • Keep the heat in your home set at a minimum of 55 degrees.

Why is a Frozen Pipe a Concern?

When water begins to freeze, it expands. This can cause both plastic and metal pipes to burst, possibly leading to significant water damage to your home.

  • Since water expands when it freezes, it puts unwanted pressure on pipes.
  • As water freezes, the force exerted from the expansion can cause a pipe to burst, regardless of the strength of the material.
  • You may not know you have a burst pipe as the water has turned to ice. Once the temperature starts to warm and thawing begins, leaking and flooding can occur.

What Do You Do if You Have a Frozen Pipe?

  • If you have a leak, turn the water off immediately to prevent water damage and call a licensed plumber to make repairs. If your home is heated by an older steam heating system, consult with your heating professional to determine if it is safe to continue to run the heating system with the water supply turned off for your particular heating system.

Read more here.

10 best and worst U.S. cities for driving in bad winter weather

Certain cities are safer when factoring rainy, icy, or snowy winter weather conditions into collision frequency. These are the top 10 safest and most hazardous cities to drive in during bad weather based on the 2015 Allstate America's Best Drivers Report. 


1. Kansas City, KS: 39.1 inches of precipitation, 24.8% less likely to crash

2. Cape Coral, FL: 55.9 inches of precipitation, 21% less likely to crash

3. Brownsville, TX: 27.4 inches of precipitation, 24.6% less likely to crash

4. Boise, ID: 11.73 inches of precipitation, 23.5% less likely to crash

5. Madison, WI: 37.3 inches of precipitation, 18.2% less likely to crash

6. Huntsville, AL: 54.3 inches of precipitation, 14.7% less likely to crash

7. Fort Collins, CO: 15 inches of precipitation, 21.1% less likely to crash

8. Port Saint Lucie, FL: 63.7 inches of precipitation, 11.8% less likely to crash

9. Cary, NC: 47.4 inches of precipitation, 13.8% less likely to crash

10. Montgomery, AL: 52.8 inches of precipitation, 12.4% less likely to crash


Most Dangerous:

1. Boston, MA: 43.8 inches of precipitation, 157.7% more likely to crash

2. Worcester, MA: 48.1 inches of precipitation, 120.7% more likely to crash

3. Baltimore, MD: 42.4 inches of precipitation, 113.9% more likely to crash

4. Washington, D.C.: 43.5 inches of precipitation, 106.3% more likely to crash

5. Springfield, MA: 44.7 inches of precipitation, 93.1% more likely to crash

6. Providence, RI: 47.2 inches of precipitation, 87.4% more likely to crash

7. Glendale, CA: 23.3 inches of precipitation, 79.4% more likely to crash

8. Los Angeles, CA: 13.9 inches of precipitation, 63.3.% more likely to crash

9. San Francisco, CA: 38.3 inches of precipitation, 65% more likely to crash

10. Philadelphia, PA: 48.5 inches of precipitation, 64.4% more likely to crash

Traveling at slower speeds, allowing yourself more time to get to your destination, and increasing your following distance while driving can lower your risk of collision in bad weather conditions.

Read more here.

Ways to avoid crime this holiday season

The busy holiday season provides numerous chances for crimes of opportunity. From robberies to identity theft, criminals are looking for ways to steal your gifts, credit card information, cars and anything else they can take easily.

Safety starts at home

Allstate Insurance says that burglaries increase by 11% during the holidays, and property stolen from vehicles increases 17%.

And there are some risky behaviors that can increase the chances of a robbery claim. More than 50% of Americans say they have left a door unlocked for a friend or family member and 52% have left a key hidden somewhere. This also means easy access for would-be burglars.

Frequently, Christmas trees are near doors or windows, providing burglars with a clear view of the presents under the tree. Consider storing gifts out of sight and putting them under the tree Christmas Eve to make them less enticing to thieves. Use timers for lights throughout the house to make the home appear occupied and help keep robbers away. Make sure doors and windows are locked before leaving or going to bed.

While you’re spreading some holiday cheer this season, don’t forget to take these precautions to avoid becoming an unintended victim.

Online savvy

Posting travel plans on social media can tip off would-be burglars of your plans in advance. Make sure family members don’t post when you will be gone and where you will be for the holidays. Also consider turning off the GPS locator on your phone when posting photos online.

Beware of scam emails either offering amazing discounts or soliciting your contributions to a “worthwhile” cause. Phishing emails increase significantly this time of year and their primary purpose is to get your personal information or access the data on your computer.

Make sure to keep passwords secure and consider using just one credit card for online purchases. Monitor the account to ensure that no unauthorized purchases have been charged to the card. Credit cards offer more protection for online shopping than debit cards. Use secure websites for purchases and look for the padlock icon or the "https” in the URL address.

Check out any online business through the Better Business Bureau, or at the very least, read the reviews from other shoppers before making a purchase. Stick to reputable dealers before buying and recognized nonprofits when making a contribution.

Allstate says that 67% of adults admit to having valuables delivered to their homes while they’re not there and 86% said they have experienced the theft of packages during the holidays. If you won’t be home, have your packages delivered to work or to a trusted neighbor or friend.

Safer shopping

There is so much going on at a shopping mall during the holidays, and all of the chaos provides the perfect cover for thieves who need to blend into the background.

Shoppers who are talking or texting on their cellphones make easy targets for criminals because they’re not aware of their surroundings. Pay attention to where you are and who is around you, both inside and outside of the shopping area.

The National Crime Prevention Council (NCPC) recommends not buying more than you can easily carry — or take a friend along to provide an extra pair of hands. If you’re by yourself, ask a store clerk or security guard to help get the packages to the car.

Have your keys out before you get to the vehicle, and check the area surrounding the car and the back seat before entering. Parking in a well-lit area allows you to see anyone who might be loitering around the car.

If you’re going to multiple stores, don’t leave packages out in the open — either put them in the trunk or cover them in some manner. According to Allstate, 60% of shoppers have left valuables in their cars, and 6% have experienced a car break-in during the holidays.

Today’s technology makes it much easier for thieves to steal your credit card information. The NCPC says to wait until you’re ready to make a purchase to pull out your credit card. If you’re using a debit card, cover the keypad so people nearby can’t see your PIN.

The holidays are a wonderful time of the year, and by taking a few practical precautions, you can make it harder for the Grinch to steal more than the joy of the season.  

Have a safe and happy holiday season!

Read more here.

Auto Insurance Pricing: Time for a move towards Zillow & Travelocity Models

There is currently no comprehensive, comparative pricing transparency for automobile insurance in the United States. This is a daunting challenge brought about by a number of factors. While none of them are insurmountable, many of them will change slowly over time.

These factors certainly include a reticence among some of the insurers in the industry to enable such an environment. Admittedly, some of the insurers’ concerns are valid, both for the quality of the consumer experience when selecting insurance, as well as for the health of their businesses and the industry at large. 

Consumers are ready to go online for car insurance. More than 71% of those who shopped for new car insurance sought out quotes from online sources, but around 80% of consumers continue to turn to agents when it's time to purchase.

How insurance is different from travel and real estate:

Insurance is mandatory, regulated by individual states, and is complex and critical. Bad insurance is like a bad airline — consumers avoid it.

While it’s very easy to go online, comparison shop and then buy most consumer products, few consumers are choosing to do the same for for Auto insurance. As the Consumer Reports research shows, you’re as likely to be judged on factors hidden in your credit score through a proprietary formula used by insurers as you are for your driving history.

Auto insurance is tightly regulated with different rules and regulations for every state. It’s an incredibly complex and highly configurable product offered by more than 300 different companies across the U.S., many of which specialize in packaging and delivering their offerings to a subset of the market, such as consumers in a specific region or risk category.

So why all the mystery?
The act of underwriting any individual’s risk for most forms of insurance is a rich calculation of dozens of variables — and this is particularly true for Auto. These variables determine the major calculus of the market: the balance between premiums paid in and claims paid out.

These calculations are crucial and determine if the provider will make a profit or lose money on underwriting operations. Just like any other business, the goal is to make a profit and do so without driving away customers by having high costs. These premium/payout calculations are based on a few not-so-subtle factors, such as credit rating and driving history, alongside dozens of other considerations, such as annual mileage driven, garaging address, loss history and other elements that indicate the likelihood of submitting a claim or causing an accident.

As one might imagine, additional circumstances drive pricing too. Pricing will differ greatly between a casual driver who goes to-and-from the supermarket in a rural area once a week and a daily commuter who goes 20 miles in the stop-and-go traffic of a densely populated urban area. Add that to individual driving history, the types and levels of coverage desired at purchase, and the statistical commonalities for genders, careers, vehicle ages, safety features, regional weather events and dozens more — and one understands the complex nature of the beast.

In order for Auto insurance to continue as an industry, all variables must be examined to strike the proper balance between a competitive price for the consumer and a reasonable ability to make a profit for the insurer.

Therefore, having a comprehensive set of information about a consumer is critical in order to make a pricing decision that is both competitive and profitable. And to date, this hasn’t always been possible by entering a few facts on a website.  In short, it’s much easier to quote the price of a round-trip plane ticket online based on a few specific data points than it is to make an accurate prediction of car insurance rates.

The Challenges:

1. Third-party comparison sites-

Insurers are willing to present pricing online to consumers, as evidenced by their own online quoting environments. However, despite ad claims to the contrary, they are far less willing to show quotes on third-party websites. Some will, some won’t. Why? In this author's opinion, because doing so would dramatically limit insurers' abilities to confirm that the inputs supplied by third-parties were carefully, thoughtfully and securely gathered and validated — and are trustworthy enough to deliver to the consumer an accurate rate against that specific carrier’s underwriting criteria.  

Comparison shopping websites force carriers to make their peace with these concerns in order to participate, while at the same time striving to constrain the length of their questionnaires and simplify the depth of information gathered.

Unfortunately, this creates a conundrum: With minimal information, comparison sites still demand participating insurers guarantee the rate they offer up for display, potentially forcing them to lose money by quoting a rate that’s too low; or they allow them to vary the initial quoted price and final quoted price, potentially upsetting consumers.

2.  Auto insurance is really, really complex, with many options

The features and options of an Auto insurance policy are far more complex than those involved buying a plane ticket or the aforementioned toaster. A better analogy: Buying an Auto insurance policy is like putting together a whole vacation trip or a complete kitchen full of appliances, the components of which wildly affect the cost and ultimately the value and quality of the experience, and vary greatly based on the circumstances of the particular consumer and their needs. A quick weekend trip with college friends on the cheap for a 26-year-old is very different from a weeklong Disney vacation for a family of five. A refrigerator for an apartment a landlord plans to rent out is much different than a Viking range and stainless steel appliances for a foodie’s brand-new dream kitchen.

Likewise, the variety of coverage levels for Auto insurance are many: collision, bodily injury, breakdowns and roadside service, towing, deductibles, personal property, old car versus new, single driver versus multi-driver, etc. Add in the fact that certain carriers are more competitive when Auto is packaged with Homeowners' insurance and you quickly realize the complexity and how hard it is to easily quote an accurate price.

3.  Incompatible legacy pricing technologies

The pricing, provisioning and service infrastructure within most insurance carriers has been built on legacy technologies and platforms designed to service the internal needs of each company and its agents — with minimal interoperability for anyone outside their ecosystem. Even for online, direct providers, systems were built to meet the needs of their own websites and call centers only. 

These needs are significantly different from those required to facilitate an environment for standardized, secure and high-volume interactions with third parties who would want to provide comparative price shopping experiences to consumers visiting their websites. 

4. Agents still matter

Just as Zillow hasn’t replaced real estate agents, and LendingTree hasn’t obliterated mortgage brokers, online Auto insurance sites haven’t replaced agents. In fact, their businesses actually improved in 2014, with 70% reporting increased revenues in 2014, up from 60% in 2012.

A majority of the insurance carriers in the United States today still operate entirely through an indirect sales channel that leverages local independent agents as their primary form of distribution. Only a handful of carriers don’t leverage a local agency distribution channel, while many sell direct to the public and through a local agent model.

This business model, by its very nature, is in conflict with the notion of a directly quoted and sold online experience which prefers centralized call centers and resources for direct selling. The simple existence of online shopping environments and direct sales models has not, nor will it in the near term, force the transition of existing indirect business models to direct ones. Again, comparison shopping environments suffer from a lack of participation — because local agents and even some great carrier operations aren’t included.  

The automotive insurance industry is simply far more complex than others that have successfully transitioned into online selling. These complexities cannot be easily reproduced with a couple of clicks. The only way to truly follow the path blazed by the travel and real estate industries is to embrace the marketplace approach.

By doing so, the industry will not only benefit its agents and local agencies — still the backbone of the industry and the way a majority of purchases are made — but will also guarantee that consumers are getting the best price and strongest protection possible.

Read more here.

Flooding causes destruction in North and South Carolina

Residents across the Carolinas have experienced catastrophic flooding due to excessive rainfall over the past few days. 16 inches of rain fell in Columbia, South Carolina, on Sunday alone, and multiple other places around the area experienced well over 20 inches of precipitation within the span of a few days. These heavy rains have severely damaged and destroyed dams, homes, businesses, roads, and have also taken lives. The National Guard was deployed to help in parts of South Carolina after the President declared a federal state of emergency on October 3rd. 

To make matters even worse, only about 10 percent of South Carolina homeowners have flood insurance, so many losses from this disastrous flooding will be uninsured. Flood and wind damage are often excluded from Homeowners policies, which many do not realize. 

The Insurance Information Institute says that as of July 31, 2015, there were 199,540 National Flood Insurance Program (NFIP) policies written in South Carolina totaling $133.4 million and covering $50.8 billion in property and contents. NFIP policies provide up to $250,000 in coverage for a residential structure and $100,000 for personal contents. Businesses have slightly higher limits with $500,000 for the structure and $500,000 for contents.

For pictures and more information click here.

Four Ways Companies Could Adjust to Imminent Employee Benefits Tax

The Affordable Care Act's "Cadillac tax" is creeping into the picture, starting in 2018. This tax entails a 40 percent increase in employer-provided health care insurance for single plans costing more than $10,200 and family plans over $27,500. As a result, employers are currently working to cut costs that have been rising for years in order to avoid this tax. Therefore, you may be seeing some changes to benefits provided by your employer during this fall's open enrollment period:

1) Encouraging healthy living: A recent survey found that 42 percent of employers were contemplating adding or expanding programs to improve employee health. These programs begin with a health risk assessment and coaching, which may include help to quit smoking, eat better, or manage chronic health conditions, to help employees improve their well-being. All of this is done with the hope that it will ward off future medical expenses.

2) Adjust Coverage: Companies have been raising deductibles, the amount someone pays before insurance coverage kicks in, which lowers the premium or cost of coverage and could cause employees to shop around for better prices. Many companies are also adding surcharges to the cost of coverage for spouses who have other health insurance options. If your spouse is able to get coverage through his/her job, your employer will most likely encourage that option. 

It is also very possible that businesses will cut back on the usage of flexible spending accounts. These accounts allow workers to set aside money before taxes for out-of-pocket medical expenses.

3)  Offer new alternatives: More employers and insurers are attempting to shave costs by providing telemedicine options that connect people virtually with a care provider through a smartphone, tablet or computer for relatively minor conditions. These visits can cost half as much as a trip to the doctor's office, which can run around $100 for people with high deductible coverage.

Some companies also are considering moving their employees to a private insurance exchange. For that coverage, employers give workers a set amount of money and then send them to an exchange that offers several different plans.

4) Wait out the debate: Some employers are choosing to not take action yet until they see what happens with the tax.

Republicans and Democrats are both calling for the repeal of the Cadillac tax because of worries that the threshold that trigger the tax will grow more slowly than the actual cost of care, which means that each year more and more plans will be subject to the tax. 

The Risks of Buying Cheap Insurance

The saying you get what you pay for applies to many parts of life, including insurance. Wanting a great deal is understandable, but it is important that your insurer will be able to provide meaningful help when it is needed. Here are some reasons why cheap insurance might be worthless:

It might not be real. Numbers, especially recent numbers, are hard to come by, but an updated 2015 report from the National Association of Insurance Commissioners found that between 2000 and 2002, the U.S. Government Accountability Office identified 144 fake insurers nationwide that sold fake health insurance to more than 200,000 policyholders, resulting in more than $252 million in unpaid claims.

The NAIC's report also said there are still many fake companies that sell auto, homeowners, rental, life, disability, prescription drug and long-term care policies. And it's evidently a global problem. This year, in England, the Association of British Insurers warned consumers that unauthorized insurance adviser – also known as ghost brokers – were selling bogus car insurance policies.

You're likely underinsured. Sean Scott, a restoration and general contractor in San Diego and author of "The Red Guide to Recovery – Resource Handbook for Disaster Survivors," says many people have been burned by cheap homeowners insurance policies. That doesn't mean your insurance isn't the real thing; even if you have the most ethical insurer in the world, if your premiums are really cheap, your policy may feel fake because there are so many restrictions that barely anything is covered.

Scott offers the example of wildfires that swept through Southern California in 2003 and 2007. He worked with many of the homeowners, but he couldn't help several because of their lackluster insurance policies.

Your claims may be paid at a snail's pace. Granted, this can happen when you're paying big bucks for insurance. But if your payments are going to El Cheapo Insurance, it seems logical that the company specializing in getting the lowest possible premiums from its customers might be a little stingy when it comes time to return some of that money.

And if you do have a cheap insurance policy, here is what to do:

Research your insurer. This would save many a headache caused by bogus insurers. Go to your favorite search engine and start checking out your insurance company.

"Look for companies that have a strong rating with A.M. Best, Moody’s and S&P," O'Dell says, referring to some well-known businesses that have information, such as credit ratings, on financial services. A.M. Best, in particular, is geared toward the insurance industry.

Read the policy. Sounds logical, but plenty of smart people don't. "More than once, clients have shown me a policy they bought through the mail thinking it was a great deal on some life insurance, only to read the coverage and find it was only an accidental death and dismemberment policy. If you die of natural causes, it pays nothing," says David Hardin, president of Hardin Financial Group, a retirement planning firm based in Troy, Michigan.

In addition, be on the lookout for any language in your policy that you don't understand. True, every insurance policy, even the best, has complex language and legalese, but you want to look for a policy that, for the most part, offers fairly clear and straightforward language. And keep an eye out for weasel words – ambiguous phrasing that could mean anything.

Insurance, after all, is all about managing risk and trying to have a happy ending if something terrible happens. If you end up paying for a risky insurance policy, you're already losing.

How to make repairs and rebuild wisely following storm damage

From wildfires in California to tropical storms and hurricanes on the East Coast, extreme weather is happening all over the country, and damage should be dealt with properly.

With the threat of tropical storms, hurricanes, and other severe summer weather upon us, it is important to know how to repair and rebuild any resulting damage. These repairs should be made as soon as possible after a natural disaster, but should also be done in a smart and safe manner. The Federal Emergency Management Agency (FEMA) recommends taking the time to consult with your insurance agent about coverage, as well as contacting local officials and carefully choosing a contractor when planning a project. 

Click here to read some tips for rebuilding and remodeling your home after a natural disaster.

12 home theft prevention tips for traveling homeowners

What do you need to do to prevent break-ins while you are away from the home?

Summer is a popular time for vacations, weekend trips and even day trips, which means homes remain empty while their occupants are out having fun. Not surprisingly, the highest percentage of burglaries happen during the summer months.

According to American Modern Insurance Group, 30% of all burglaries occur as a result of something as simple as an open or unlocked window or door. Even if you feel your neighborhood is safe, empty homes are more vulnerable to theft.

The good news is, home theft is preventable. American Modern offers the following 12 tips for homeowners to help them take the proper steps and measures to secure their homes.

If you know you are going to be away from your home this summer, follow these 12 easy steps to securing your home and personal belongings.

Click here to read more!

Surveillance cameras in the home

The uses of home security cameras and homeowner liability concerns

Surveillance cameras are everywhere these days. The fronts and sides of many cars are equipped with cameras and processing software, the rooftops of commercial buildings are crowned with hidden surveillance equipment and even traffic lights incorporate cameras to catch unsuspecting motorists speeding through a yellow-to-red light. Even visible security cameras have a positive effect, deterring possible criminal activities.

In this day and age it is common for surveillance cameras to be positioned throughout homes in visible and hidden locations. The devices eavesdrop on the humdrum of ordinary life to ferret out evidence of potential and actual crimes. The placing of these cameras has become increasingly more creative with some being hidden in teddy bears, wall outlets, and clocks. Hidden surveillance cameras in the home can be used to catch suspected criminals in the act, resulting in arrest and conviction.

Click here to read more about the legal parameters and ramifications of using home surveillance cameras.