Insurance Hour
KCAA: Insurance Hour (Thu, 12 Sep, 2024)
Owning a rental property sounds like a dream until you realize how much work goes into getting it ready. Determine a competitive rent price, market the property, schedule the showing screen tenants, draft the lease at a rent collection, handle maintenance request, maintain communication. Whew! Sound complicated? Renner's warehouse is here to take the hard work off your rental to-do list. Qualify tenants? Check. Rent collection? Check. Maintenance coordination? You got it. Go to rennerswearhouse.com for a free rental analysis to find out how much your home can rent for. Or call 303-974-9444 because from now on, the only thing you need on your to-do list is to call Renner's warehouse. Chevy has the SUVs you know and love, and now there's one more. The first ever all-electric Blazer EV. With the latest tech, incredible range, and easy charging, this head-turning electric vehicle is Motor Trend's 2024 SUV of the Year. When you're ready to go EV, Chevy's got you. Get all the exciting details on the 2024 Chevy Blazer EV at your Colorado Chevy dealer today and learn more about EV tax credits and take advantage of current offers going on now. 1932.org Buckle up everyone, you are strapped in and ready for the insurance hour. With me, your host, Carl Sussman, informing, educating, and entertaining Californians one policy at a time, this is Insurance Hour. Hello, hello, this is Insurance Hour and I am your host Carl Sussman, thank you so much for being here. We are live, as always, and you can call in now at 559-656-0317, you can also send your questions in to questions@insurancehour.com. If you need help immediately, you can grab your cell phone to help pound 250, use the keyword insurance, and be transferred to an agent right away. Today, we have a lot going on, we have some listener questions, and we're going to go through a little bit of insurance history, terminology, and some things that you might not be aware of that you really should be aware of. So, let's just jump in with that right away, and then we'll take a break now and then we'll switch between your comments and questions, and of course, we'll stop if anybody calls in with a question right now, and if you call in and get the voicemail, it just means the lines are busy, please leave a message, leave a detailed message, let us know if you're all right being on the air, we'll play your question, we'll give you the answer. Got it? Let's do it. First, let's talk about insurance. Now, I know it's your favorite subject, it's what everyone dreams about. You think about being a doctor, a lawyer, or an insurance agent, right, doesn't everybody? Well, maybe not, but insurance has been around for quite a long time, back in the 14th century as a matter of fact. Back in the 14th century, the first marine cargo ship from Genoa, Italy, had an insurance policy on it, which basically meant that this was a cargo ship that was going from Italy to the New World, and they were trying to find a way to protect the people that were investing in that ship. They were saying, "Okay, if we send out 10 ships, maybe only half of them are getting there, right, or three quarters of them are getting there, the rest are lost at sea, that's costing them a lot of money, it's costing them the ability potentially to even be able to keep sending those ships." So someone had an idea, they said, "Well, I have an idea. How about, we'll share the cost with you and we'll share the profits with you. That way, if we send out the same 10 ships and only half of them go out, well, you're only going to be half out the money and you'll be protected that way." This was the beginning of insurance, and it was more of a mutual concept, right, because people that were insuring other people had a vested interest in their not being a claim. Remember that, because it's important. So when insurance began, the idea was, you and I both wanted to do something and we shared in the exposure and we shared in the profits, all right, that is the beginning of how insurance began. Later, of course, it became more of a commercial product and people that were not involved in the actual, they had no interest in what the product was or what they were insuring. They simply wanted to make money on the concept of insuring and they wanted to be the ones that win in the event that there isn't a claim and they would sell a policy for a premium that would pay and collect enough premium to be able to pay for those times when there is a loss, right? But remember, when this started, this was for people that were like-minded, doing something similar and they both were going to win, in essence, in the event of not having a loss. Not one side, both sides. Now fast forward, "Loids of London" came into the market. Now what is "Loids of London", "Loids of London", believe it or not, is in London. It actually still exists and it's there as an area where people will get together and talk about and decide on risks, risks that they're willing to ensure and what does that mean? What does it actually look like? Well, it actually means that there are people that sit around in offices and other people will come to them. I know, that's already shocking but it happens and it still happens today and they'll say, "All right, I have, for example, a whole bunch of buildings that I want to ensure." They're in an area that's risky to some extent, not risky to other extent. We want to get insurance on these buildings, right? It's a large company that's building all of these buildings. So, "Loids", this particular syndicate it's called, which might be one particular company or group of people that have gotten together, will look at all of the documents being presented them and they'll say, "Hmm, let me see." So this is how many buildings. This is what it's going to cost and here's where it's going to be. Let's take a look at where it's going to be built. Let's take a look at who's building it. Let's take a look at their experience in building. Let's take a look at what is the likelihood that they're actually going to finish the project, succeed and have a building, right? Because let's face it, not all construction projects begin and finish some die halfway along. Some of them never get off the ground after someone is collected. So, this syndicate or this group of people or this company and this example in "Loids of London" in London are sitting and reviewing documents. They're sitting and trying to decide what it is about this particular risk and what should they charge. They have to decide what the likelihood is of these buildings being complete. They have to decide what the likelihood is that these buildings will not be complete and they have to decide what is it going to cost them, how much are they going to ensure it for in the event that there is a total loss. What is their maximum exposure? What could happen if all the bad things happen at once? If all of the buildings, if everything that they're ensuring is completely wiped out. Remember, an insurance policy is designed to bring you back to where you were before. So, it has to always take into consideration the worst case scenario. They're not allowed to say, "Well, maybe half the buildings might get destroyed." No. They have to be prepared for all of the buildings to be destroyed when they're coming up with their pricing structure. So, these people sit and they decide and they come up with a number and they say, "Okay, we want X number of dollars and based on those dollars in the event that there's a loss and all of these details, of course, are written out in more detail, they are going to pay this person that is looking to have purchased this policy for these buildings." That's how it's worked. So, you see the difference what's already happened? We've gone from an environment where people were doing the same thing. If I want to follow the same example, maybe it would be another set of people that are building buildings would say, "All right, you're concerned about losing your buildings. Well, we're going to take on half that risk, but then forever you're going to have to share in the profits with us," right? It went from that to now a situation where people are sitting in a room and then they're saying, "Okay, what's the likelihood of there being a loss? What's it going to cost us if there is a loss?" They come up with a premium amount to charge the person looking to get the insurance and based on that premium, the person gets to decide, "Well, is it worth me paying this money adding it to my expenses, adding it to my costs to know that in the event there's a loss, I have a third party," right? Not me, not my partners, anybody else. A third party that's going to come in and actually pay that claim, "They're going to pay money to me to make me whole again," and that's where insurance moved on to next, that concept. Now, how it's regulated in the United States of America that came next, we're going to talk about that. We're going to talk about what big landmark cases came to fruition that decided who was going to regulate the business of insurance. Who's going to be the one responsible for that? We're going to talk about that and much more right after the break. This is Insurance Hour. I am your host, Carl Sussman. Remember your questions? Give them a call. Give them a call. You call in with them at 559-656-0317 or email them in to questions@insurancehour.com. We will be back in a flash, thanks. Let's talk about earthquakes for a minute. Look, we know we live in earthquake country here in California, powerful, devastating earthquakes have happened here before, and science says that they will happen again. They can't tell us exactly when. They can just tell us that it is going to happen. Count on it. Prepare for it. Did you know that earthquakes are not covered by your homeowner's insurance policy? You need a separate policy to give you the peace of mind that you will be able to recover without getting financially wiped out the next time we get hit with a big one. There's a great company here in California that will provide you with earthquake coverage you need at a price you can afford. That company is Giovera. I have a policy through Giovera. I really like how easy it is to choose from all of their great coverage options backed by the financial strength that lets me know that they will be here for me when I need them the most. Go to getquake.com/insurancehour to learn more. That's getquake.com/insurancehour. Make sure you're ready for the day when the ground shakes again. Hello, hello. This is Insurance Hour. I am your host, Carl Sussman. Thank you for being here. Phone lines are open 559-656-0317. Send your questions in to questions@insurancehour.com. If you need help right away, you can also dial #250 from your cell phone. Use the keyword insurance and be transferred to somebody right away that can help you. For the break, we were talking about insurance. I know I'm shocking. Before I jump on that and I go through the next step, which was how is insurance regulated, we did have an email coming that I wanted to answer and address the question on. I'll read it to you here. Please explain what I do when I'm looking to buy a house that is somewhere that nobody wants to insure. This is the tough one. If you think about it, if you're buying a house somewhere and there are no insurance companies that want to insure you there, it might might give you pause. Why is it that the insurance carriers are not looking to write insurance in that area? Keep in mind that there are situations going on right now where the insurance market is so tight in certain states that it's not necessarily that that particular location is bad. It might just be that insurance carriers are not writing policies or they've reached their maximum capacity for that period of time. Keeping that aside, if you're in an environment, you're in a state, you're in an area where the insurance market is thriving, there are lots of companies writing, there's lots of competition going on. Owning a rental property sounds like a dream. Collect a rent and relax. That is until you realize how much work goes into getting it ready. First, you need to conduct market research to understand local rental trends and determine a competitive rent price. Then there's cleaning, staging, repairs, and hiring a professional photographer. Next, develop a marketing strategy. List the property on rental sites and schedule countless earnings. Sound complicated? Renner's Warehouse is here to take the hard work off your rental to-do list. Our job is complicated because it should be. We handle everything from marketing and showing your property to screening tenants and preparing the lease. Our best-in-class property management professionals take care of your property as if it were our own, from rent collection to maintenance coordination, all for one flat monthly fee. Go to rennerswearhouse.com for a free rental analysis to find out how much your home can rent for. For call 303-974-9444 to speak with a rent estate advisor today. Because from now on, the only thing you need on your to-do list is to call Renner's warehouse. Chevy has the SUVs you know and love, and now there's one more, the first ever all-electric blazer EV. With the latest tech, incredible range, and easy charging, this head-turning electric vehicle is Motor Trend's 2024 SUV of the Year. When you're ready to go EV, Chevy's got you. Get all the exciting details on the 2024 Chevy Blazer EV at your Colorado Chevy dealer today and learn more about EV tax credits and take advantage of current offers going on now. And for some reason, the particular home you're looking to purchase, nobody wants to insure it. Take a pause and say to yourself, "Why?" Remember an insurance company innately wants to sell insurance. They want to be able to sell an insurance policy because that's how they make a living, right? They sell policies. If they're not looking to sell a policy to you, then there's a reason. Take a look. Look at the area that you're in. Look at the home. Look at the condition. Find out what the reasons are. If you're dealing with an independent broker, one of the advantages, you can go to that broker who might be telling you, "Hey, I can't find you a policy," and you can ask them, say, "Well, what is the insurance company saying? What is happening that's telling them--what is it that they're kicking it back based on?" They will tell you. They will tell the insurance broker, "Hey, we don't want to insure this location because of X, Y, and Z." Now, X, Y, and Z might be something you can deal with, it might be a change you can make, it might not. If it's simply something you cannot change or are not interested or willing to change, then you have to look to what are called secondary markets. And secondary markets are what are called surplus insurance companies or non-admitted insurance companies. All that is are insurance carriers that are not specifically licensed to transact business in the state that you are in, that you're looking to purchase the policy in. It doesn't mean they're bad, it just means they are not licensed in that particular state. It gives them a little more flexibility in how they price their products, not always a good thing, sometimes a good thing. And it gives them a little more flexibility on how they can underwrite and what type of products they have. Again, sometimes a good thing, sometimes not such a good thing. But the main point I want to make here for this person that sent in this question is, if a carrier doesn't want to insure it, maybe you don't want it. Just saying. There's a reason. I call them the big brands. There's a reason that the big brands are thinking that they do not want to insure that location, that house. Is it the condition of the house? Is it the age of the house? Is it the location of the house? Find out. That also reminds me, someone had sent a question and I think a week or so ago, and they were asking saying that they're having trouble getting insurance, is it them, or is it the car, or is it the house? I don't remember which one it was. And I had a good time with that question because I realized that, well, it's a little bit of everything, right? A good insurance company, a good underwriter, someone that's actually going through the process of underwriting, underwriting by the way, means they're going to look at all of this information. Like we talked about earlier, that's Lloyd's syndicate that would sit down and look at all of the characteristics of all of those buildings to decide if it was going to offer a policy or not. But an underwriter has to look at as much information as they can, hopefully, and decide. If multiple carriers are saying no, then there's definitely something there you should be aware of. Now, if you still are unable to obtain a policy through the excess or surplus market, now you're going to take yet another pause and say to yourself, how badly do I want to be there, right? Because there's a concern. By this point, you definitely should know what it is that is keeping the insurance carriers from wanting to write insurance. You don't then stop again, find out. Find out what it is that the insurance carriers are not comfortable with that is preventing them from writing a policy for you. For example, if you're in the state of California, they have to tell you. They can't just say, nope, they have to tell you why. And again, if you're working with an independent agent or broker, they're already talking to the carrier because they want to try and find coverage for you. That is their job. And they're going to find out what those reasons are. Sometimes they'll come back and they'll tell you straight out, look, the house is in an area that they think is just too dangerous or they'll come back and they'll say, the roof is 40 years old. And you might say, but it's in good condition. It's still 40 years old, right? They don't want to deal with it. Maybe you don't either. Meaning maybe if you're willing to put a new roof on the house, you'll be able to have a policy and multiple options, okay? Let's get back to our little history lesson, right? So we were talking about insurance and how it's regulated. So there was something that was passed in 1945, it was called the McCarran Ferguson Act of 1945. And what it did was it confirmed that the government of the United States, the federal government does not, NOT, have jurisdiction over the regulation of insurance companies. The states do. Hmm. Interesting. Is that good? Is that bad? Up to you? Let me give you some of the ramifications of that. What that means is every state has their own department of insurance, every state has their own rules, their own guidelines, every state has their own ability to regulate, to set guidelines, to set rules, I guess you can call them laws that insurance carriers need to follow if they're going to transact business in their state. If they don't, they become what we mentioned now. A non-admitted company, meaning they are not willing to abide by the rules that that department of insurance is throwing at them. And they're saying, you know what? We don't want to play that game. We're going to write our own policies anyway, without your blessing in essence. Most states, and again, this is up to the states, will have specific documentation that you must sign that says that you as a consumer understand your purchasing insurance from a carrier that is not licensed in the state. There are a lot of reasons for this, but primarily the goal is to be sure you know that this company for whatever reason is not licensed, is not regulated, is not being monitored, is not a lot of things by that particular state's department of insurance. I know that sounds scary and it is, and there are definitely some downsides, but it's not a death blow. It doesn't mean that the carrier must be garbage, or that you absolutely should not go there. Take it for what it's worth. That just means you need to do a little bit more due diligence, a little bit more work to figure it out if it's going to be the right carrier for you. First, you need to conduct market research to understand local rental trends and determine the competitive rent price. Runners warehouse is here to take the hard work off your rental to do West. Our job is complicated because it should be. We handle everything from marketing and showing your property to screening tenants and preparing police. Our best-in-class property management professionals take care of your property as if it were our own, from rent collection to maintenance coordination, all for one flat monthly fee. Go to Runnerswarehouse.com for a free rental analysis to find out how much your home can rent for. Or call 303-974-9444 to speak with a rent estate advisor today. Because from now on, the only thing you need on your to-do list is to call Runners Warehouse. Chevy has the SUVs you know and love, and now there's one more - the first ever all-electric blazer EV. With the latest tech, incredible range, and easy charging, this head-turning electric vehicle is Motor Trend's 2024 SUV of the Year. When you're ready to go EV, Chevy's got you. Get all the exciting details on the 2024 Chevy Blazer EV at your Colorado Chevy dealer today and learn more about EV tax credits and take advantage of current offers going on now. But the point is that the McKaren Ferguson Act of 1945 said, "Okay, this is not a federal government thing. This is a state thing." So states, you decide how you want to deal with the situation of licensing and dealing with the insurance companies, okay? After we come back from this break, we're going to talk a little bit more about it and how those regulations come down, who's in charge of them, how much say do we ask consumers actually have? Don't forget to call in with your questions at 559-656-0317. Send them in to questions@insuranceour.com, and of course, grab your cell phone to our #250, use the keyword insurance, get connected with an agent that can help you right away. This is Insurance Hour, and I am Carl Sussman. My name is Patrick. My name is Calvin. I'm Mouse Catergregh. My name is Paul, and I will be your guide through the wonderful world of Disney sound experiences. This show is a weekly trip into the world of the Disney theme parks and resorts, and this is the place where you get to use your ears to surround yourself with the magic. For your safety, please remain seated while listening to the window to the magic.com podcast. Maybe there's a name for this, something like "Diznautic" concession. Please visit windowtothemagic.com for more information, or you can find us on Apple Podcasts and in the iHeart Media app. Hello, hello. This is Insurance Hour. I am your host, Carl Sussman. Thank you so much for being here today. The phone lines are open, 559-656-0317. Any other questions you would like to email in, please do, at questions@insuranceour.com. You can help right now, like this very second, now pound 250. Use the keyword "insurance", and you will be transferred to someone that can help you. Now, for the break, we were talking about legislation, regulation, laws, all that good stuff about the insurance industry. So we talked about how the laws that need to be going for insurance carriers, their guidelines, based on the McCarran Ferguson Act, are up to the states. The states decide what they're going to do. Based on that, there is, in all of the states, an insurance department, they sometimes call it the Department of Insurance, some states call it the Department of Finance and the Department of Insurance as part of that, but they're somewhere in the state's bureaucracy, sorry. In the state system, there is an organization, a part that is dedicated to dealing with the insurance regulations. And part of that, there is going to be an insurance commissioner who is tasked with basically dealing with all things relating to insurance, which makes sense, right? You got to have someone in charge. So how is that insurance commissioner put in that place? Who decides who is going to take that responsibility? Because as you can imagine, it's going to be a fairly significant job. It's going to be important. It's not going to have, you know, it's not a part-time gig. It's going to steer the entire organization, the entire industry of insurance in that state in one direction or another. So the Department of Insurance and their insurance commissioner, nine states as of this recording, have an elected insurance commissioner. That's California, Georgia, Kansas, Louisiana, Mississippi, Montana, North Carolina, North Dakota, and Oklahoma. So if you're living in one of those states, you have an insurance commissioner that is there because of you, the voting public, you put them there or her. That's why I said, oh, you put them there. Is that fair? Is that gender neutral? I think it is. You put them there. Now, what happens in the rest of the states? Well, the rest of the states, that position is usually given to this individual by the governor. The governor is going to appoint somebody that role. They're going to say, oh, you are such a good person. You are now the insurance commissioner. You don't have any say in that. Personally, there are pros and cons to that that I can see. Some of the pros are that it's no longer a political position, right? If there is an insurance commissioner that's in a state that has to be elected by people, then of course you're going to have a commissioner that has to deal with the politics of it, right? Because insurance can be, even though it shouldn't be, these days very political. Some states will have what's considered a very liberal insurance commissioner. All insurance commissioners tend to be the ones that you will think of, even though this is not necessarily the case, are going to provide the most consumer protections, whereas the more conservative insurance commissioners are seen as, even though it's not true, the ones that will be more flexible with the insurance industry and provide the insurance companies with more leeway to do their business. Now, of course, you hear that and you think, well, I want the liberal guy. I want to have the most protections that I can, right? That's why I'm saying it's not always about the politics of it. Even I have to sit here now and try and distill it down to that, even though that's not actually the case. Every individual insurance commissioner does their own thing. Now, are they going to have slants? Are they going to tend to focus on one thing more over the other? Of course. But in general, the insurance commissioner's job is to be sure that the admitted insurance carriers are solvent. They know what it is that they're doing. They're going to be there to pay claims. They play fair, basically, okay? That's going to be the case regardless if the insurance commissioner is elected by the general public or if it's someone that the governor or other high level representative in the state appoints to that position. Now, just for the sake of discussion, I'm talking about how some commissioners have their own, well, things that they're known for or they're remembered for, I guess you could say, right? What is their staple? What are they going to go down as being responsible for? So I took the time to keep track of a couple of them for you and I'll give you these. These are out of California working from current going backwards. From 2019 to the present, California has the insurance commissioner Ricardo Lara. He is known what he is going to be remembered for creating the sustainable insurance strategy, which is the most sweeping insurance reforms in probably 30 plus years in the state of California. Now, insurance reforms, does that make you think insurance protection, insurance company flexibility, you don't know and it doesn't matter because the goal is more updated regulations and that's what Ricardo Lara is doing. Prior to him, we had Dave Jones from 2011 to 2019. He is best remembered for expanding health care coverage and consumer protections. You can guess which side of the political spectrum he is from. Prior to that, we had Steve Poiser, 2007 to 2011 and he strengthened auto insurance regulations. Prior to that, we had John Garamendi, 2003 to 2007. He focused on earthquake insurance reforms and prior to him, we had Harry Lowe from 2000 to 2003. He worked on workers compensation and reforms that come through that. So every insurance commissioner is going to be focused on something. I almost had fixated. That might be true too. But they're going to be focused on things based on what it is that their state needs the most, what it is that they need to have done, what it is that's most important for them to be dealing with because insurance is a big business in this country. For example, again, just in the state of California, there are over 300,000 people that are directly employed by insurance companies and that does not take into account independent agents, independent brokers. That's in addition to those 300,000, so you can quickly see how it's important to have an insurance commissioner that is able to walk that line and deal with the insurance carriers as well as the consumer protections that need to be in place. Again, not an easy job. Now while I'm mentioning that there are independent insurance agents and brokers that are not included in that $300,000 number I gave you, let me give you another quick tidbit that you should be aware of. There are basically three types of insurance people that represent insurance policies to consumers. We call them captive agents as one option. These are people that will provide one product from one insurance company. They have independent insurance agents or brokers which are independent. They're going to be able to go to many carriers to try and find a product that best suits you and there are employee agents or brokers that are employees of insurance companies and obviously they will just sell the product of that insurance company. Let's talk a little bit more about that after the break because I think it's important that we know a little more detail, fill in a little more color to what that looks like and what is best for you because the truth is there is no one simple answer. There might be. Let's talk about it a little more detail when we come back. This is insurance hour, I am your host Carl Sussman, thank you for being here, phone lines are open 559-656-0317 and of course send your emails to questions@insurancehour.com. We will be back in a flash. Do you need homeowners insurance? Has your previous insurance company left the state? Non-renewed your policy? Or maybe they just raised your premium to an amount that you simply can't afford? Whatever the situation, we can help. Just dial #250 on your cell phone and say keyword insurance quote and we will connect you with an agent who can assist you right away. Or if you prefer, you can visit us online at insurancehour.com/quotes. Whether you are looking for homeowners insurance or auto insurance, we'll send the best options straight to you. So, what are you waiting for? Simply dial #250 and say keyword insurance quote and we will connect you with a live agent to help provide competitive quotes for your homeowners insurance or auto insurance. Don't get caught unprepared, ensure what matters, with an insurance company you can trust and with a premium that you can afford. Don't put off until tomorrow what you should have done yesterday. Simply dial #250 on your cell phone and say keyword insurance quote. Hello, hello, this is insurance hour, I am your host Carl Sussman, thank you so much for being here. The phone lines are open 559-656-0317, send your questions in to questions@insurancehour.com. If you've gone through a lot of information today, if you've missed any of it, you don't want to, jump online, search for insurance hour and you'll be able to find us. The fund is also as a podcast, you'll find us on YouTube, you'll find us on Amazon, Amazon Alexa, LinkedIn, TuneIn, TuneIn, iHeartMedia, you name it, we're everywhere. You want to get this information, this is some good stuff. And remember, it's important that you have more information so you can make more informed decisions, that's what we're here for. Owning a rental property sounds like a dream, collect a rent, and relax. That is, until you realize how much work goes into getting it ready. First, do you need to conduct market research to understand local rental trends and determine a competitive rent price, then there's cleaning, staging, repairs, and hiring a professional photographer. Next, develop a marketing strategy, list the property on rental sites, and schedule the showings. Sound complicated? Renters Warehouse is here to take the hard work off your rental to-do list. Our job is complicated because it should be. We handle everything from marketing and showing your property to screening tenants and preparing the lease. Our best-in-class property management professionals take care of your property as if it were our own, from rent collection to maintenance coordination, all for one flat monthly fee. Go to Renters Warehouse.com for a free rental analysis to find out how much your home can rent for. For Call 303-974-9444 to speak with a rent estate advisor today. Because from now on, the only thing you need on your to-do list is to call Runners Warehouse. Chevy has the SUVs you know and love, and now there's one more, the first ever all-electric blazer EV. With the latest tech, incredible range, and easy charging, this head-turning electric vehicle is Motor Trends 2024 SUV of the Year. When you're ready to go EV, Chevy's got you. Get all the exciting details on the 2024 Chevy Blazer EV at your Colorado Chevy dealer today and learn more about EV tax credits, and take advantage of current offers going on now. Before the break on that note, we were talking about three types of insurance agents or brokers or representatives, generally speaking, that can provide insurance proposals to you. Let's talk about the first one, captive. What does that mean, captive agent? Sounds a little bit scary. You're captive. Well, what that means is you, as a captive insurance agent, are representing one insurance company. You are captive by them. They are basically dictating that if you're going to offer their product, they do not want you offering competing products. No judgment call, just a fact. Now, why is that good? Well, some of the good things that can go along with that are, number one, there is a very tight integration between the insurance agent and the insurance company. They are, in essence, almost. They're not by tax law. They're employees. They're very close. That's the point I'm trying to make. They deal with the same underwriters, the same people at the company, the same reps, the same marketing. It's a typically long-term relationship that they develop. Arguably, since they're dealing with one company and one set of products, they're going to be extremely knowledgeable on the very intricacies of those policies and of the insurance company in general. So that would be an advantage to being potentially a captive insurance broker. Would be that intimacy between the insurance agent and the insurance company. There may even be relationships formed between the insurance agent and people that handle claims, right? Don't forget, claims adjusters that work for an insurance company, they're there as well. They're employees of that same insurance carrier. So it's very likely that the insurance agent might, in fact, have a personal relationship develop. If nothing else, they know each other and when there's a claim, they'll be able to reach out to that claims adjuster and say, "Hey, we talked about this one. What do you think?" Blah, blah, blah. So let's just call it intimacy. When you're dealing with a captive insurance broker, intimacy, not between you and them, but between them and their one insurance carrier that they have. The next one, let's talk about our employee agents. Now, that's as close to a captive agent as you can be, but with this, they're not even pretending. They're not saying, "Well, they're going to look out for you. They're going to do the best they can for you. They're going to." That's probably not entirely fair. They're going to claim that and by law, they're supposed to be doing that. But an employee agent is clearly motivated to write the policy that is from the insurance company that employs them, similar to a captive agent. They are going to want to sell those products, not only because that's how they get their bread buttered, but because they don't have any other options, exactly like a captive agent. The image I like to show is a circle and little squares and what was the game? Not operation. What was that game called that had different shapes and you set a timer and it would go tick, tick, tick, tick, tick, tick, and you had to take the different shapes and put them in the little holes and you had to do it fast enough, the triangle and the triangle, the umbrella and the umbrella, the square and the square. You did all of that before it just popped up and all the pieces jumped out and basically took three or four months off your life because it scared you so much. I can't think of it. If you think of it, please shoot me an email, leave me a comment. I need to know what that is. It's going to bother me. Um, employee agents similar to captive or may arguably be trying to force that circle into the square. It's awfully close, right? It should fit. They want to get your business. That's how they make a living. That's how they get paid. This is not a knock. Good captive agents, good employee agents. If they see something that is not the best for the consumer, they would tell them, hey, I don't have what I, what looks like is what you're looking for, you might need to check somewhere else. That might mean checking with another employee or a captive agent. It might mean checking with an independent agent, but a good captive or a good employee agent is going to take that time and still say, hey, I would love to write your business. Either I can't or what I can offer you doesn't sound like it's exactly what you're looking for. You might look elsewhere, but you understand the tug of war because they want your business, right? That's how they make a living. Let's move on to independent agents and brokers. Independent agents and brokers, as you probably can guess by the name, are independent. They are not an employee of any insurance company. They are not captive to any one insurance company. They have the ability to go to multiple insurance companies to obtain insurance. What does that mean? Well, it means that they can go to any independent insurance company that they have a contract with. They can't literally go to every insurance carrier and just write a policy because they have to be appointed with that insurance company first. So what would be considered a good insurance agent or broker that's independent would be one that has a wide variety of insurance companies that they do have relationships with. Not one, not two, not a hundred. Somewhere I would say between 10 and 20 would be great depending on the market that might not be possible, but a good independent agent is going to have a contract with multiple insurance companies. Now you'll remember how I talked about captive agents potentially having that intimacy with the insurance carriers. Independent brokers can have this as well. If they have an appointment with an insurance company for a long time, there's nothing stopping them from having that same intimacy, that same connection, that same understanding with the underwriters of that company or with the executives of that company or even with the claims of judges. Because remember, even though the independent agent is not an employee of that insurance company, the claims of justice probably stay put as do the sales folk and everyone else involved. So a good independent broker can make those same types of connections and relationships with the insurance companies that they represent. Beware of the independent broker that is limited to one or two insurance companies. There's usually a problem. That's usually indicative of a situation where they're not able to get more insurance carriers willing to appoint them, basically to give them permission to offer their products. That's something you should be aware of and be concerned about because a good insurance broker or agent that's independent, independent companies would want to do business with. And again, if they're choosing not to, perhaps you should choose not to as well, just saying. And finally, with an independent insurance agent or broker by law and by the documents, I guess, and I'm not an attorney disclaimer, they represent you to the insurance carriers. So they're not going to try and force feed you anywhere because they work for you. They will either find another carrier or tell you that they do not have a market. There's no other way for them to go. All right. That's just a quick snapshot of the three types of ways that you can purchase insurance from a person, an independent broker, an employee broker or a captive broker. We're going to talk about some more. We're going to talk about some other things having to do with claims right after the break. Remember, stay tuned and we will be back in a flash. This is Insurance Hour and I'm Carl Sussman. Ladies and gentlemen, boys and girls, in just a few moments, the window to the magic podcast show will begin. My name is Patrick. My name is Calvin. I'm Mouse Katergre. My name is Paul and I will be your guide through the wonderful world of Disney sound experiences. This show is a weekly trip into the world of the Disney theme parks and resorts and this is the place where you get to use your ears to surround yourself with the magic. For your safety, please remain seated while listening to the window to the magic.com podcast. Maybe there's a name for this. Please visit windowtothemagic.com for more information or you can find us on Apple podcasts and in the iHeartMedia app. Bones are still open at 559-656-0317. We've had a lot of information here today. If you've missed any part of this show, jump online, search for Insurance Hour. You'll find us as a podcast on YouTube, wherever you look, you'll find us there. And yes, you'll find us on good old social media. You can check there as well, but get the information that we're providing. It's good information. It's useful. No agenda here. And as I've said before, I'll say it again. If you find I've said something that is factually inaccurate, please call me out on it and I don't mean that in a negative way. Send me an email, give me a call, say, "Hey, you said X, Y, and Z and I believe it's A, B, and C." If it is something that's factual, please provide proof and I will absolutely give you credit, jump back on the next possibility that I can, and make that correction. Because my goal is not to make myself seem like I know absolutely everything. My goal is to provide you with the most accurate and up-to-date information that I can. There's an old saying, and if you know who this is that made this quote, let me know. It is that stupid people think they know everything and smart people think they know nothing. Think about that. Anyway, for the break. We were talking about different types of ways to purchase insurance through an independent broker, through a captive agent, or through an employee agent. One other way to purchase insurance is directly to the insurance company. That can come in many different ways. It could be you actually picking up the phone and calling an insurance carrier directly. It could mean you're going online, filling out a form, purchasing a policy without ever talking to a person. Sometimes you could even do it through the mail. This actually was the first direct to carrier way that it was really taking off. You didn't have people making a lot of phone calls. You had lots of people that were purchasing insurance over the mail. They would get a solicitation that said, "Here's your price." And they would sign, attach a check, send it in. That's it. I would not think I'm going out on a limb to say that the level of coverage that people were getting compared to what they were thinking they were getting, or they actually needed for sure, was pretty low back then, because all of that was being done in an automated system. Again, we're talking 30-some odd years ago. Systems weren't as good as they are today. You could see some type of computer system able to generate proposals based on a lot of data these days, 30 years ago, not so much. But that was one avenue that people could purchase insurance. It was through the mail. Or of course, they could pick up the phone and call. That's another way you can purchase insurance. My opinion is you do whatever works best for you. A lot of times, agents and brokers will complain about the direct-to-consumer market. They would say, "Well, I don't understand. The insurance carrier is competing with me." I don't personally look at that way, because I think the type of consumer, the consumer that wants to have my advice, or the advice of my staff, my counsel, if you will, is not going to be the same type of a consumer that will just go online, push a few buttons, and buy a policy. It's a different buying habit, different buying pattern. There's a different mentality, a different way that people are looking at purchasing insurance. I'm not saying that one is necessarily better than the other. Yes, I am. You could probably guess which one I'm biased toward, but I didn't. I'm biased, obviously, toward talking to an agent or broker, because they are going to have more information than you do. Let's face it, they had to get licensed. Hopefully, they've been spending time in this for many, many, many years. They're going to know the ins and outs better than you will as a general consumer. That's just the way it works. That would be almost akin to you saying, "Well, I think I need an x-ray, and you would go get an x-ray." No, that's not the way the medical system works. You have to go to a doctor, they have to examine you, and they have to say, "Oh, you need an x-ray," and they'll order an x-ray. Same idea. Insurance is complicated, and it's getting more and more complicated as time goes by. That's one of the reasons I'm doing this program, is I want to be able to be a resource for you to get information that you need without any type of slant, without any type of spin, without any type of bias. I just want to give you information. So remember, call them with your questions, 559-656-0317. If you cannot get through, if you get voicemail, that usually means that our phones are busy, which is good, yippee. Just leave a voicemail, let me know, let the voicemail system know, "Hey, here's my question, it's okay to read it on the air," or "Here's my question, I don't want my voice on the air, just answer the question, and we will do it." You can also send an email to questions@insuranceour.com, and you can even text the phone number, text 559-656-0317. Just text us your question, and again, let us know if you want to be recognized personally, or you just want the question answered on the air, whatever you want, that's what we're going to do. I digress. We've talked about insurance policies, we've talked about the history, we've talked about how to purchase it, but what about claims? You pay our insurance premium, but what about claims? Do insurance carriers keep up their end of the bargain? Do they keep up and make that claim payment when the time comes? It's a big question, I thought it would be interesting to go over some of the largest events that insurance carriers have had to pay for. In no particular order, there were the 9/11 attacks in the United States, there was over $40 billion in claims, those are $2001, mind you, Hurricane Katrina in 2005, about $41 billion in claims were paid out. There was the Tohoku earthquake and tsunami in Japan in 2011 that was over $35 billion. There was Hurricane Sandy in 2012 with around $30 billion in losses paid out. They were California wildfires in 2017 and 2018 that had over $20 billion paid out. Hurricane Harvey in 2017, about $20 billion paid out. Hurricane Maria, also 2017, rough year for hurricanes, $30 billion, who couldn't forget the Northridge earthquake in 1994. This was a long time ago, and even back then, $20 billion was paid out. And of course, who can forget what's most recent? We have good old pandemic in 2020 where they're saying, and they can't even put an exact number on it based on my research, hundreds of billions of dollars were paid out by the industry. So yes, insurance carriers do step up and do pay claims. Are there times that they don't? Because of course, they're not just there for these massive losses, they're therefore smaller losses, much smaller losses, that we might have everything from a car accident to a slip and fall liability claim to ensuring a restaurant for having liquor liability. All of those things insurance carriers have to do. We're going to talk a little bit about insurance claims, how they're filed, how you deal with them, when you think it's time to take it to the next level, and what to do if you feel like you're not getting your claim handled in the way that you want it to get handled. Because let's face it. Owning a rental property sounds like a dream, collect a rent, and relax. That is until you realize how much work goes into getting it ready. First, you need to conduct market research to understand local rental trends and determine a competitive rent price. Then there's cleaning, staging, repairs, and hiring a professional photographer. Next, develop a marketing strategy with the property on rental sites and schedule countless earnings. Sound complicated? We handle everything from marketing and showing your property to screening tenants and preparing the lease. Our best-in-class property management professionals take care of your property as if it were our own, from rent collection to maintenance coordination, all for one flat monthly fee. Go to runnerswarehouse.com for a free rental analysis to find out how much your home can rent for. For call 303-974-9444 to speak with a rent estate advisor today. Because from now on, the only thing you need on your to-do list is to call Runners Warehouse. Chevy has the SUVs you know and love, and now there's one more, the first ever all-electric blazer EV. With the latest tech, incredible range, and easy charging, this head-turning electric vehicle is MotorTrend's 2024 SUV of the year. When you're ready to go EV, Chevy's got you. Get all the exciting details on the 2024 Chevy Blazer EV at your Colorado Chevy dealer today, and learn more about EV tax credits, and take advantage of current offers going on now. Nah, I'll tell you now. No, I'll tell you now. No, I'll make you wait. I'll make you wait. I'll make you wait to come back after the break, and I'll give you my famous quote about insurance claims. You will never forget it, and it is extremely useful. I promise you. We'll get that right after the break. This is Insurance Hour. I am your host, Carl Sussman. We are here, and we will be back in a flash. Are you feeling lost in the search for the right insurance? Making call after call, only to find no one willing to go that extra mile for you? At Sussman Insurance Agency, we understand that frustration, and we're here to change your experience. Where other sea obstacles we see opportunities, while many might shy away from jumping through hoops. At Sussman Insurance Agency, we are prepared to leave, looking under every rock, exploring every avenue. That's not just what we do. It's who we are. Our dedicated team doesn't just offer policies. We provide solutions. Solutions born for persistence, expertise, and a genuine commitment to finding you the best coverage possible. We don't just meet expectations. We surpass them. If you're tired of hearing no, or it's not possible, it's time to turn to a team that believes in yes and let's make it happen. Don't settle for less. Watch out to Sussman Insurance Agency at 877-411-5200. Visit us online at sussmaninsurance.com or email sales@sussmaninsurance.com. Let's uncover the insurance solutions you deserve. Sussman Insurance Agency, going the extra mile every time. Hello, hello. This is Insurance Hour. I am your host, Carl Sussman. Thank you so much for being here today. Phone lines are still open, 559-656-0317. Any questions, please send them in to questions@insurancehour.com. And of course, if you need help right away, dial #250 on your cell phone, use the keyword insurance to get someone on that line right away. Oh, PS, you can also text us at 559-656-0317. We shouldn't forget that because I like texting. It's a lot easier sometimes than sitting on hold or leaving a voicemail. So feel free to do that as well. Before the last break, we were talking about claims. But again, if you missed the last break or anything before that, just jump online, search for Insurance Hour. You'll find us. We're on YouTube. We're on Apple Podcast. We're pretty much everywhere. You'll look for Insurance Hour. You'll find Insurance Hour. I suppose you could search for Carl Sussman as well. You'd probably find Insurance Hour there too. So we were talking about claims. We were talking about claims because that's why we have insurance, right? That's why we purchase an insurance policy. Because we want to know that in the event something happens, that's something that we are buying a policy to protect us from, we want to know that the insurance carrier is going to step up and write that check. Now I promised you before the break also, I was going to give you my famous claims phrase. I'm going to give it to you right now. Claims adjusters are just people. Never forget that. One claims adjuster for one insurance company is not indicative of that insurance company period. It's not indicative of if that insurance company, quote unquote, pays their claims or doesn't. It's not indicative of if another insurance company throws money at you or if another insurance company makes it so easy, it doesn't matter. It's not how it works. Insurance claims adjusters are just people. They have good days, they have bad days. They might view your claim in one way, sometimes they might view your claim in another way. It's not the carrier, it's nothing personal. It's just a people situation. So the next time you're involved in a situation where you're dealing with a claims adjuster and you're getting annoyed, you're getting pissed, you're feeling like, you know what, this is not right. I am not getting my claim handled correctly. This insurance company sucks. Time out. It's not the insurance company, at least not at that stage. You may have a bad claims adjuster. Remember, there are good doctors, there are bad doctors, there are good insurance brokers and bad insurance brokers. There are good restaurants to go to because they have good staff and some that just stink. There are good claims adjusters and bad. And you can't take the experience of one claims adjuster and say, this now represents the entire insurance company experience, let alone the entire insurance industry experience, based on one person, one human being that's dealing with your claim. Now I'm not here to defend claims adjusters, I can tell you one thing though, it's a thankless job. This is a situation where you are dealing with people that have just had a loss. Most of us are not in an emotionally great place. If we've just had a loss, we're upset, we're emotional, we're peeved. Is that even, can I say that? They're peeved. So understand that claims adjusters dealing with people when they are not at their friendliest. So to be able to counter that, they need to try and be extra friendly. Some of them succeed, some of them don't. But at the end of the day, if you are dealing with a claims adjuster and you feel that you are not getting what you need, you have every right to ask them, straight out, say, you know, I feel like I'm not getting my point across or I feel like I'm not getting what I need out of my claims experience, can I please speak to whomever you're reporting to directly? Don't be, don't aggravate them. Don't say, you suck, who's your boss? Because first of all, what you've just done is you've guaranteed that if you end up staying with this adjuster, you are not going to get the best treatment. Number two, you've put that adjuster on the defensive, which you never want to do. And number three, you're going to have to fight to get that supervisor because they're not going to just cough it up, right? They're just people. And I'm not saying you should kiss them on there. You know what? All I'm saying is that remember that claims adjusters are people. And if you're not getting what you need, you tell that person, you say, I understand there's a process. If I'm not handled, if my claim doesn't feel like it's moving fast enough, or there's a process, if I don't feel that my claim is being handled the way I want it to be. See how now you're not accusing them of doing something bad. You're saying it's not being handled the way I want it to be, or it's not being handled as fast as I want it to be. You're putting it on you, number one, that's going to put you in a position where the adjuster might just change the way they're dealing with your file. Because they're going to say, well, I want it to be handled in the way they want, right? Or they might say, yeah, well, I can't do that. Let me get them somebody else. Either way, a little bit of that goes a long way because claims adjusters do not have an easy job. As far as claims go, all I can tell you, my best advice is to keep that in mind. Claims adjusters are just people. They may have had a big fight that morning with their significant other. They may have just gotten their salary cut. They may have just had a death in the family. We don't know. We don't certainly ask them those questions, and we shouldn't. But just remember, in the event you are not getting a claim handled the way you want, you do have rights, you can do things to try and get to somebody else. And at the end of it all, if you've gone to supervisors, if they've assigned you additional claims adjusters, if they've done all of this stuff, and you still are in a situation where you're not satisfied, if they're an admitted insurance company, you do have the ability to go to that state's department of insurance, the states you live in, and ask the department of insurance for help. That is one of the things that they are typically there for. You got me? You feel me? I'm going to have a claims adjuster or actually a retired claims adjuster on the show in a few weeks, and we'll get to hear firsthand what it's like from that perspective. And I know who gives a you-know-what. It's interesting. All right? I'm an insurance nerd. I think it's interesting. So I think maybe you will as well. Plus, I'm sure there will be a lot of great stories to hear. It reminds me, I wrote an article on Kiplinger.com, if you want to search Carl Sussman Kiplinger, and you'll see the articles. And you'll find one on there that talks about it never being your fault. Because that's one of the funny things about claims. And when you're in this business long enough, you'll start to feel like people just never want to say it's their fault, even when it clearly is. It's a fun article. I go read it if you have some time. So wrapping up today's show, we talked about the history of insurance. We talked about claims. We talked about how to purchase insurance. We talked about ways to deal with claims in the event that you're not getting things the way you want. We talked about large claims that the industry paid out. And again, I'm not trying to say, "Oh, these poor insurance companies had to pay all this money." No, they did it because that's their job. We paid premium. They paid claims. That's the relationship. We paid premium, and the insurance carriers pay claims. And anything outside of that, we can work with. Once again, I'm Carl Sussman. This is insurance hour you've been listening to. Hopefully, you've learned a lot. You've enjoyed it along the way. If you've missed any part of the show, please go online. Search for insurance hour. You'll find us on Apple Podcasts, on YouTube. Pretty much everywhere you can go, you can just go to insurancehour.com. That's the easiest way. Pick your poison from there, how you want to listen to the show, or how you want to watch it. And you'll be able to get the entirety of this show, if you missed any, and previous shows as well. We try and keep everything online. We try and keep it updated. And again, my goal to provide you with the most accurate, most updated information that I can. Thank you. I am Carl Sussman, and you have been learning from insurance hour. Take care. I do want to thank all of you for taking the time to listen today. I know insurance is not necessarily the most sexy concept. It's not the most exciting thing in the world. It is important that you understand what it is you're getting, what you should be looking for, red flags. You name it. You just need to know more than you used to. Things are more complicated than they used to be. If you have any questions, please reach out to me directly. You can email your questions to questions@insurancehour.com or call and leave a voicemail at 559-656-0317. Educating and entertaining Californians, one insurance policy at a time, this is insurance hour. This show is dedicated to Shamrock Papa. See digits, lock them in for more information, recreation, and guaranteed fun. KCAA 1050 AM. Owning a rental property sounds like a dream, collect a rent, and relax. That is until you realize how much work goes into getting it ready. First, you need to conduct market research to understand local rental trends and determine a competitive rent price. Then there's cleaning, staging, repairs, and hiring a professional photographer. Next, develop a marketing strategy. 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Meanwhile, her opponent, former President Trump, is scheduled to speak in Tucson, Arizona. Trump's campaign says today's event will see him target Harris and her policies after squaring off in Tuesday's presidential debate. The world's first all-civilian spacewalk took place this morning. The Polaris Dawn mission launched four people into orbit Tuesday, including American billionaire Jared Isaacman, who this morning became the first private citizen to conduct a spacewalk in Earth's orbit. New Orleans is dealing with the aftermath of Hurricane Francine. Jefferson and Orleans parishes are asking residents to reduce their water usage after water penetrated the sewer lines, raising concerns about the capacity of the sewage system. Kind of do we were going to have a problem early in the evening? Probably in the afternoon, we were hearing that people couldn't flush their toilet. And we were like, "Uh-oh, we understand what that means." Jefferson Parish President Cynthia Lee Sheng says residents and businesses are urged to cut back on water usage for the time being the sewage and water board of New Orleans says several pump stations suffered power outages and other issues. Six UN staff members are among nearly three dozen dead in the Gaza Strip after a pair of Israeli airstrikes on a school reportedly being used as a shelter for refugees. victims in Wednesdays attack work for the UN agency that assists Palestinian refugees displaced by the war against Hamas. Michael Kastner, NBC News Radio. Located in the heart of San Bernardino, California, the Teamsters Local 1932 Training Center is designed to train workers for high-demand, good-paying jobs in various industries throughout the Inland Empire. If you want a pathway to a high-paying job and the respect that comes with a union contract, visit That's1932trainingcenter.org. Here's a look at the local news and weather from KCAA. I'm Yvonne Fruhan. Investigators announced Wednesday the arrest of the arson suspect the cubes are starting to line fire. Justin Wayne Hostenberg was identified as the lone suspect who allegedly started the fire September 5th, near Baseline Road and Applin Street in Highland. Hostenberg was arrested late Tuesday and was jailed in lieu of $80,000 bail. Sheriff Shenan Dikis says a vehicle observed at the fire scene was traced to Hostenberg's residence in Norco, where additional evidence was found. Dikis said the suspect may be linked to other suspicious fires. Newly released data from the Federal Reserve finds California ranks first among the states with the highest credit card debt increases. The average credit card debt in California increased by $4.5 trillion in the second quarter of 2024. The average household credit card balance is around $10,680 after ingesting for inflation. Six people perished Monday in the fiery three-vehicle collision north of San Jacinto. Cal Fire said three survivors had injuries ranging from serious to minor. The crash on Gilman Springs Road at Ridge Street touched off a brush fire that burned nearly four acres before it was put out. The California Highway Patrol closed the intersection for a full investigation. Now for the weather. The inland empire will have mostly clear but smoky skies at times throughout Thursday. A cooling trend with highs Wednesday near 90s and in the 80s on the weekend. Overnight lows dropping to the upper 50s. Mountains. Sunny skies but smoky at times. Slowly cooling down to highs in the 70s and 80s. Only to cool down 10 degrees further. Deserts will have relative heat and blowing afternoon dust. Highs Wednesday from the 90s to 107. Also prone to cooling down. Beaches increasing overnight clouds and morning fog. Afternoon clouds and cooler temperatures. Highs around 71. Surf to the 4 feet. Water 66 to 76. Finally some relief from the heat. 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