Insurance Decisions

Insurance Decisions, Decisions, Decisions…

Insurance decisions, both good and bad, we’ve all made them.  Some decisive thinkers analyze situations ad nauseam to the point of indecision. Others live with a damn the torpedoes mentality. Of course, balanced decision making is somewhere in between the extremes. One thing is for sure, we all have to live in the aftermath of our actions.

In December of 2015, a condo board of directors made a decision to increase their windstorm coverage deductible from 3% to 10% or, in dollar terms, from just over $100,000 to a smidge above $350,000 in order to save a few thousand dollars. After all, there have been no hurricanes since Wilma on October 24, 2005, and this premium is a giant line item on the profit and loss statement. In other words, if something happens the board will take the risk and pay a higher out of pocket to save money on the premium and, with the savings, build the cash reserves to handle a windstorm loss in the future. No one can expect the unexpected. Our changing earth dealt us February 16, 2016, a day when 3 twisters touched down in South Florida as if it were the Midwest.

One of those tornadoes found its way to the association which had just changed its deductible back in December.

The EF1 storm took off part of a roof and caused damage to a significant number of sliding glass doors and windows, while pummeling the pool fence and furniture on the deck which is a common area. The damage was just north of the windstorm deductible on the less expensive policy. The members will be assessed for any shortfall in the reserves for the repairs of the building and common area. The higher windstorm deductible caused a shortfall for the association in this story since the additional $250,000 exposure had not been properly assessed for, and the association was planning on building the reserve over time but wanted to save money now. The members are now pointing fingers since the assessment will be relatively large and people want to know who to blame for the decision that cost them money.  Now the fun really begins.

At Rolfs Insurance Services, we want to bring the clarity of knowledge and thought to our clients’ insurance decisions.

We assist in identifying the risks and suggesting solutions to mitigate the potential for financial loss. We believe in providing strength through knowledge delivered with integrity for protection and peace of mind. Please contact us if we can be of service to you and your family and friends.

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