Life Insurance was the last thing I needed.

This is a more personal blog than I have done before, so please accompany me on a real life journey through some serious ups and downs.  At the end, you will understand why I have changed my mind about a very important topic: Life Insurance.

Like many of my peers in my twenties and into my thirties, I never thought about life insurance.  I had rent, student loans, auto insurance, a healthy going-out budget – I was leveraged about as far as I could go.  Besides, what was life insurance to me anyway?  It seemed like paying hundreds of dollars a month so that someone in the distant future could pay for my funeral when I was gone from this world.  And at that point, I would hardly care about that, would I?

Of course, many of us thought the same thing about investing, that it was tomorrow’s problem that I couldn’t afford today.  But that’s a blog for another time.

What I didn’t know about life insurance was that the younger you are, and the healthier you are, the better the value.  It really isn’t that expensive to get a term life insurance policy if you are young and healthy, and you also save on Whole Life as well.  Like investing, value is added the sooner you start.  And the way life insurance works you could be looking at a substantial amount of money going to your loved ones if something terrible happens to you.

But I’m getting ahead of myself.  Let’s talk about what happened to me to make me look at life insurance differently, and then explain a little about what the heck life insurance even is.  After that, I’m betting you’ll see it in a different light – just like I did.

Sometimes you have to lose to understand.

Life Insurance is about death.

A couple of years ago my father passed away.  He had been fighting cancer for about five years, and the disease that we thought would be slow and subtle was sudden and severe.  I had planned my life a certain way, but by the third year of his illness I realized that life – or should I say, death – didn’t really care what those plans were.  I moved back to the East Coast to be closer to him, and was there the night he left this world.

Losing a parent is a terrible experience, and one that forces us to grow in ways that we may not expect.  My father was an insurance agent himself, but he never lectured me on why I should get this insurance or that, never told me how to live a life that avoided risk – except for driving slow in the left lane.  He couldn’t stand that.  People, for the sake of my father’s memory, GET OUT OF THE LEFT LANE.  There, happy Dad?

My father taught me about life insurance by using it.  In the aftermath of his death, when we were doing the paperwork and putting his affairs in order, one of those activities was to inform his life insurance company that he was gone.  It was a simple, easy process, and I was grateful for that – after losing someone that meant that much to you, doing spreadsheets, going through bank statements and filing insurance claims are the last thing you want to be doing.  After a brief conversation, we discovered just how much my mother would be getting from his life insurance policy.  It was shocking.

I am not going too far to say it changed our lives.  Of course my father had planned for retirement and my mother was taken care of in that sense, but the life insurance money made it so that she didn’t have to worry about, well, anything.  She wasn’t going to go out and buy a yacht or the Carolina Panthers or anything (not that I would have advised her to), but she was able to invest the money and live comfortably.  Just like that, she didn’t have to get a job, sell the house, or worry.

I learned that life insurance doesn’t have to cost that much a month, and yet it can give you $500,000, or $1,000,000, or $5,000,000, depending on how much you can afford monthly.  I was blown away.  I saw in action how it changed her life, and through her, our lives.  It wasn’t something that a sleazy insurance agent would be droning on about at a barbecue while you are waiting for the hot dogs to finish grilling (Oh my God am I that guy now?).  It was like a last gift from Dad, one that I never could have imagined.

Oh baby.

Life Insurance is about life.

Fast forward to a month ago, when I became a father.

Yes, the picture above is me.  And yes, I’m probably still figuring out how to hold him, and a great number of other things.  I won’t write about what an immeasurable joy it is to be a father (it is), nor will I write about all of the things I have learned and am learning as I become a father myself (did you know the human body doesn’t really need sleep? HAHAHAHAHA).  But what I will tell you is that, when he was a couple of weeks old, a thought hit me like a proverbial thunderbolt from the heavens:

I need life insurance.

After my dad’s passing, I knew what life insurance could do for a family after a loss.  But until that moment, I didn’t know who it would help.  If something happened to me in thirty years, twenty years, tomorrow, they would be in the same financial situation that we were already in, but without my help.  It was mind-blowing.  For those of us in the generation that didn’t plan for retirement (because we don’t think we ever will retire) and don’t have enough money saved (because most of it goes to student loans) the only way we can deliver a massive financial windfall to those we leave behind is through life insurance.  It sounds crazy, but it’s true.

Now, that doesn’t mean we can’t turn it around and, through smart financial planning and hard work, we can leave our families something wonderful.  Or that some of us have lived differently and already have robust financial portfolios (I’m both impressed and kind of hate you).  But the great thing about life insurance is that it helps your loved ones immediately, not in some distant future where everything went perfectly to plan and the stock market didn’t crash.  And not only that, if everything does go perfectly to plan, well, life insurance still works!  It is the icing on the cake, the cherry on top, or whatever metaphor you want to use to say it is awesome on top of awesome.

As a new parent, I have something to care for, something to protect.  That feeling doesn’t go away when I imagine my death.  I don’t think to myself, “Well, once I’m gone, whatever happens to them is not my problem.”  I want to do something about it.  And I can if I get the right life insurance policy.

Time for a little hand holding.

Life Insurance isn’t complicated.

There are two main types: Term and Whole Life.

Term is life coverage for a specific term, like 10, 20, or 30 years, while whole life is for, well, your whole life.  And that’s pretty much the basics right there.  Sure, it can get more in depth than that, for example:

• Term life only covers you during the time period, and has to be renewed or converted to Whole Life after.
• Term life is easy to purchase, often without a physical exam.
• Term life generally becomes more expensive as you age.
• Whole life usually requires a physical exam.
• Whole life has to build value over time, often needing 10-15 years to build up a decent value.
• Whole life is more expensive up front, but shows value in the long-term.

Policies can range in price dramatically based on length of the policy, age and health of the buyer, and even market calculations for some Whole Life policies.  But generally, you can get policies for anywhere from $100-1500 a month, for coverage amounts ranging from $250,000 to $5,000,000.

If you have finished this article, you already know more about life insurance than most of your peers.  You know what can happen, how it can help, and why you need it.  You also know the basics of how it works and what it does.  The only thing you need to know now is this: when are you going to get it?

If you are curious about life insurance, and you want to get deeper than the bullet points above, fill out the form below and get in touch with one of our amazing life agents.  Since the best value is found the younger you are, it is never too early to get your first life insurance policy.

The Rowhouse: An East Coast Classic

For about as long as there have been colonies and states on the East Coast of North America, there have been rowhouses.  The rowhouse is a simple, elegant solution to family housing in cities where space is at a premium.  It should come as no surprise then that we find them in cities such as Philadelphia and New York City, cities built on peninsulas between two rivers.  Examples are also in Baltimore and Washington D.C., as the style helped to create a tight urban center close to their respective centers, built around the harbor in Baltimore and the federal buildings in D.C.

Rowhouses in Philadelphia.

The rowhouse comes with it’s own set of strengths and weaknesses, and differs in many ways from the typical single family home in the rest of the United States.  Some of the differences are obvious, while others are more subtle than one might think.  And these differences lend themselves to different kinds of risks, or at least greater chances of different risks, than their yard-and-picket-fenced neighbors in the suburbs.

Let’s look at what those differences are, and see how best to protect and insure against them.

Aged like a fine wine.

As a general rule, rowhouses are old – at least by American standards.  It is not uncommon to find an entire neighborhood of rowhomes that are at least one hundred years old.  In the Society Hill neighborhood of Philly, it is not uncommon to see little signs in the windows to show what famous American owned the home in the 1700-1800s – or even that it was an important stop on the Underground Railroad.  Not all rowhouses will have some historic designation, and not all were built in the fresh aftermath of colonization.  But, if you do have one, it is probably older than fifty years, and being one hundred years old is common.

Old but sturdy.

There are some serious advantages to these older styles of construction.  Walls are typically sturdier than your average newly built house, and the foundations are more solid as well.  Many have brick-on-brick walls – and these often give you serious discounts to your homeowners insurance since they are more flame resistant than brick-on-frame or other mainly wood walls.  As a general rule of thumb, all construction materials were larger, more durable, and made to last.  These houses will stand the test of time.

They will also, however, often have issues depending on how well-kept and maintained they have been over the years.  It is not at all uncommon to find water leakage, mold, out of date plumbing and electrical, cracks in the roof and foundation, and even leaning walls.  Like any man-made object, if it is not given the proper repairs and upkeep it will deteriorate and eventually fall apart.  Also, note that none of these issues are covered under a homeowners policy.  These are problems due to wear and tear, and not a sudden event that has happened to your home.  Also, if you buy a home with issues of any cause whatsoever, you have little choice but to accept them.  You cannot buy a house and turn in a claim on your new homeowners policy, even if lightning struck before you bought it.  So be careful what you buy, and protect the valuable things in your life – especially if it is as old and special as a classic rowhome.

Leaning on each other.

Another of the major differences with rowhouses is that they lean on one another – literally.  Wall-sharing is a classic part of what makes a rowhome a rowhome; after all, being connected in a row is how they got the name.  Like townhouses, you are much closer to your neighbors than your friends in the suburbs or out in the country, but not quite as close as the apartment you used to live in.  Luckily, rowhouse walls are a little different.

Like we said before, older construction materials tend to be more durable and sturdier.  For your shared walls, this leads to less noise coming through and greater temperature retention.  Be thankful for that pile of bricks between you and your friendly but loud family next-door.  It can come in handy.

Of course, it can also be limiting.  You won’t be putting a new window in or expanding your kitchen through your neighbor’s house.  Any decision about changes to a rowhouse are either down, up or  back – as in the back patio, or yard, or I-can-barely-stand-here-and-not-fall-in-the-alley space, depending on your particular home and lot size.  Most people either put in finished basements, or roof decks, or even push their house into the back landing in order to maximize the lot that they have.

Speaking of home improvements.

Making changes to these lovely older homes with their charming but limited space can be daunting.  Replacing floors can be like performing an archaeological dig, with layers of previous families coming up with each level of carpet, undercarpet, linoleum, adhesive, and then the original pine – I mean, that’s probably the original and I’m tired of digging.  And don’t take my word for it –

No, strike that, absolutely take my word for it.

I think I just found a Sumerian coin.

In order to maintain the character of the home, special items or construction materials may be needed to keep the original feel and likeness of the rowhouse.  Remember, this goes for your insurance valuation too.  As I’ve said before in my blog on What Your Home Is Worth, homeowners insurance is based on replacement cost, not market value.  Having these older materials and construction features such as solid wood doors, brick-on-brick walls, old wood floors, plaster walls and thick floor beams means that your value will be higher than the newer built house across the street.  Insurance replaces like for like, so a company bases how much coverage you need on how much it would cost to return you to your original state.  In the case of older homes, that means replacing those original plaster walls or wood beams with as close to the original as possible.  And that can be expensive.

So don’t flinch when your insurance agent shows you a coverage amount that is $100,000 over market value.  Remember, if your home burns down and you build it back, you’ll want the money it would take to get it back the way you left it, and not some cheap imitation.  Look at it the same as you would scraping the old linoleum flooring by hand – difficult but worth it.

Living in an American treasure.

If you live and walk around in a city that has entire neighborhoods of rowhouses like Philly or D.C., it can be easy to miss the forest for the trees.  We tend to get used to whatever we see regularly, and when we live and walk past rowhouses daily, they can lose their charm.  It can be easy to forget that rowhomes are an American treasure.  They are as much a way of living communally with one another as they are an architectural style.  They create a cozy, walkable feel to a neighborhood without losing that city sense of closeness and convenience, but retain a friendly warmth that no apartment building can match.  Neighbors feel like neighbors, streets feel like an extension of your home, and a new person or family moving in on your block becomes much more intimate than getting a new flatmate, or even a new family on your cul-de-sac.

Cozy in the snow.

So treat your rowhouse right, and use the resources at your disposal to make sure you are giving it the care it deserves.  Check your local city for guides or books on how to own a rowhouse – in Philadelphia the city helpfully created this Rowhouse Manual.  Local publications may also have articles with helpful hints such as this gem from Philadelphia magazine.  And work with real estate agents and contractors who know and love rowhouses as much as you do, like the Pearce in Philly team or Hudson Hardwood Floors.

And, of course, insure your home the way it deserves to be insured.  Make sure your agent knows the difference between a rowhouse and a townhouse, that they understand the complexities of 100 year old houses, and that they appreciate how complicated a claim might be – such as if lightning strikes and your newly flipped rowhouse still has old electrical work.  Take the time to value your home correctly, making sure you have adequate protection for both the home and your personal belongings.  It also wouldn’t hurt to add extra liability protection, as you never know what you might need in a bustling metropolis with trial lawyers on every billboard.

Your rowhouse is a national treasure.  Yes, yours.  Let’s take care of it the way it deserves.

Any questions?  Reach out to us with the form below, or check out some of the amazing people and resources listed in this blog.

Full Coverage: The Heart-Eyes Emoji of Insurance

When you think of what auto insurance is supposed to do, you’re thinking of full coverage.  The term “full coverage” refers to having both liability coverage and physical damage coverage on your vehicle.  While I’ll get more into what those are in a moment, the gist of it is this: your state requires you to have insurance that covers damage that you cause to others in an accident, or liability coverage, while coverage to your own vehicle is physical damage (you usually hear it referred to as “comp and collision”).

Let’s dig into Liability and see what it covers.

And I was like, “Liability is so popular right now. Ugh.”

Liability is like an engine.  You can’t drive without it.

I mean, you could roll down a hill.  But it’s not really the same thing.

Everyone has to have liability.  That’s the law.  And the reason is simple – people need some guaranteed protections from accidents that aren’t their fault.  If someone hits you, and they don’t have liability insurance, you would have to take them to court if they refused to pay you damages that they caused.  With liability insurance, that drastic action isn’t needed.  Police statements and insurance adjusters determine fault and pay out damages depending on the limits of liability in the auto policy.  BUT, if you have low limits, and you refuse to pay the additional amount if damages are more than your limits, you can still be sued.  That’s why we always recommend higher limits, as I’ve said before in THIS BLOG.

So liability by itself is not “full coverage.”  That’s why we get asked for “liability only” insurance pretty regularly.  But it isn’t enough – in fact, you could call liability only “half coverage.”

Comp and Collision Protection Rocks

And it covers rock damage, too!  (bad insurance joke)

Comprehensive coverage and collision coverage are the second part of full coverage.  They cover the damage done to your vehicle if you and not another party are responsible for the bill.  Put simply, if you hit it, comp and collision get it – if it’s your own vehicle.  The two are different, and they cover different situations, so let’s break it down further so we can tell the difference.

Collision is coverage for damage to your car caused by it colliding with another object, such as a car, phone pole, tree or a Starbucks – pretty much anything really.

Comprehensive is also called Other Than Collision, so that should give you a great hint for what it covers.  Basically, this coverage protects you from just about anything else that happens to your vehicle that isn’t from something hitting or being hit by your car: fire, water, wind, explosion, falling objects, vandalism, theft, and, especially, glass breakage.

These coverages protect you from a huge array of risks and dangers that each of us face daily.  Run into a concrete pylon while parking?  Collision’s got you.  Neighborhood teen spray paints your car because they’re in love with your daughter?  Comp will take care of it.  Knock off your side mirror on a wall while waving to someone after church?  Collision does that, too.  Wife catch you sneaking a smoke and you drop it in the backseat and later find your car on fire?    Comprehensive will come to your rescue (marriage counseling not included).  And for all the times a pesky rock gets kicked up and cracks your windshield – yes, comp is there for you again.

Neither comprehensive nor collision are mandated by law as must-haves.  That means you need to ask for them yourselves if you don’t already have them, or bring it up at your next insurance review and ask whether or not you need it.

Yes my car was stolen.  They found it where?

Do I need Full Coverage?

So really, if you have comp and collision, you have full coverage.  After all, liability isn’t optional.  So when people say “full coverage,” they mean liability with comp and collision.  But when should you have both?

There are certain situations were you have to have comp and collision.  The most common is if your car is financed through a loan or a lease.  If it is, you are probably required by your financial institution to have full coverage.  They want to make sure that the vehicle is properly maintained and repaired in case of any damage.  They do this because they may end up owning the vehicle, and full coverage is the best way to help ensure the car or truck is given the best care possible.

If you have an older vehicle, however, that you own outright, then you may not need full coverage.  If the cost of an accident may exceed the value of the vehicle, you may want to save the money and only have liability only – with a healthy amount of coverage – to protect you on the road.  Put the money you save towards than new dream car you’re thinking of, or an investment, or a big bowl of ice cream for your adorable daughter.  Go (responsibly) nuts.

The reality, however, is that most of us aren’t required to have full coverage, but we should anyway.  One big accident could leave you financially exposed and hurting, and all from trying to save a few hundred bucks a year.  While some of us can go buy a new car after losing one completely, most of us would experience a massive financial burden from having a car stolen, burned, or totaled from running into a tree.

The real question is how can you justify not having full coverage?

I don’t have full coverage, but then again I’m made of Lego™.

Other coverages in Full Coverage.

Also included in full coverage is Medical Payments Coverage, usually called Med Pay, and Under/Uninsured Motorist Coverage.  Med pay covers those in an accident if they need medical care, while under and uninsured motorist coverage protects you if you are hit by someone with not enough insurance or no insurance at all.  While it is illegal to drive without liability insurance, it happens regularly.  Make sure the limits on both of these coverages are comfortable amounts for both you and your agent.

Full coverage policies also provide optional coverage for rental and towing expenses.  These vary, so make sure to check with your agent for more information.

So you’re going to tell me to get full coverage, right?

Pretty much.

While it isn’t necessary for everyone, the vast majority of us would be better off with full coverage.  If you’re not sure whether you are one of those people you are, or if you’d like to add the peace of mind that full coverage can bring, fill out the form below or call us to get started.

Your Insurance Policy Does a Lot

Whether your policy covers your car, truck, house, apartment, boat, or motorcycle, it does a lot to protect you from a variety of bad things that can happen.  Most policies cover you from natural events like fire, lightning, wind, vandalism, theft, and other nasty surprises.  And that’s why we have insurance in the first place – if something does happen and your home catches on fire or your car is stolen, we don’t want to have to pay for the loss out of our own pocket.  There are something that your policy does not cover, however.  And one the we get asked about a lot is wear and tear.

Did you think this was covered?

What is wear and tear and why isn’t it covered?

According to Dictionary.com, wear and tear is, “damage or deterioration resulting from ordinary use; normal depreciation.”  In other words, if you have a refrigerator, and after ten years of steady use it suddenly breaks down, that is wear and tear.  Or if your eight year old vehicle needs the brake pads replaced after them becoming worn from use – that’s also wear and tear.  Basically, if time takes its toll on something, and it begins to wear and break, that is exactly what we are talking about.

So you, the savvy and practical consumer, must be asking – why?  Why isn’t that covered?  Isn’t it damage to my home or car?  Isn’t that why I have insurance in the first place?  And the answer is – well, not really.

Insurance covers things that can happen to you suddenly.  The phrase in the industry is “sudden and accidental,” and is usually referred to as pure risk or event risk.  The risk has to be a risk without the possibility of financial gain – for example, gambling is a risk with a potential financial gain, and is therefor non-insurable (sorry Vegas lovers).  It also must be something that happens in a single event, like a fire breaking out in your kitchen, a car hitting your vehicle at an intersection, or the loss of someone’s life.  Insurance protects against these kinds of pure risk by taking on the risk for you for a fee, your premium.  Essentially, you’re paying for someone to hold the risk for you if something bad happens.

Wear and tear is nothing like that.  It happens over time, without one specific event.  It is not a true risk because all mechanical devices and structures eventually erode and decay, especially without proper maintenance.  This is a beautiful world we live in, but also a tough one, and forces like friction, decay and time can wear just about anything down.

It happens, but it isn’t what your insurance policy does.

Well, there is something that covers wear and tear.

You can get wear and tear covered.  But it’s not insurance.

It’s called a Home Warranty.  Various companies (not insurance companies) will agree to cover the eventual breakdown of home appliances, important home systems like your HVAC and electrical system, and some add-ons like pools and well pumps.  These coverages are exactly for wear and tear, and not for the things your insurance policy covers.  If your dish washer has a part break and stops working, your home warranty would cover that.  If lightning strikes and shorts out your dishwasher, your insurance policy will cover it.

Also, keep in mind that your insurance agent usually does not sell home warranties.  For pricing and service options, do some searching online to find companies that are right for you.

But you’re a savvy consumer, so you already know how to do that!

If you do need insurance help, fill out the form below and we can walk you through the coverage you have – or help you get those missing gaps in coverage, well, covered.

Why yes, you are.