Category Archives: Insurance


Can Space Tourists Get Life Insurance? by Aaron Crowe


The Oct. 31 crash of a Virgin Galactic rocket that killed a pilot hasn’t stopped the company from continuing its quest to offer space tourists a chance to see the Earth from above, giving potential riders a chance to reconsider their life insurance options.

While life insurance might be the furthest thing from any space tourist’s mind, a loophole that allows current life insurance policyholders to retain such coverage if they fly into space remains, though the insurance industry may look to close it.

Skydivers, pilots and people with other high-risk jobs or hobbies must buy extra coverage on their life insurance policies. Space tourists, however, who either already have life insurance or are applying for a policy don’t have to mention their upcoming trip to space because insurers either don’t ask about space tourism or don’t exclude it from coverage.

The loophole means they’d likely have to pay if the policyholder died on a space trip.

There are little or no established life underwriting guidelines specifically for space flight, and such activity would probably be covered under common aviation clauses and exclusions, says Rob Drury, executive director of the Association of Christian Financial Advisors.

“For a life insurance company to deny coverage for space travel would require a specific exclusion of such activity,” Drury says. “If the current treatment of aviation activities is an indication, the greater likelihood is that a proposed insured would be underwritten at a higher risk class.”

Once a policy is issued, death benefits must be paid for any death regardless of cause, unless there is a finding of fraud, misrepresentation, or suicide within the policy’s contestability period of the first two policy years in most states, he says.

Coverage is provided by omission, meaning the underwriter doesn’t ask about an applicant’s plans to fly into space.

“If someone wants to run the bulls at Pamplona, his insurer might not like it, but they must pay in the event of death if the activity isn’t specifically excluded,” Drury says.

Astronauts are rated at $10 per $1,000 of coverage in addition to their approved rate based on amount of coverage, age and other factors, says Ellen Davis, president of Life Health Home Insurance Group. Space tourists can’t buy coverage yet, Davis says.

However, if the insurer doesn’t ask an applicant about space travel, then it would be covered under travel outside of the United States, she says.

Virgin Galactic’s SpaceShipTwo crashed during a test flight. The craft is designed to carry six passengers on two-hour suborbital flights that offer a few minutes of weightlessness. The company announced after the crash that it plans to continuing selling tickets at up to $250,000 per seat.

The good news is that while flying in a rocket sounds risky, even for insurers, not many people have died riding into space. No one has died in suborbital manned flights. There have been three fatal orbital space shots, including the space shuttles Challenger and Columbia with 14 deaths, and a Soyuz flight that killed one person.

Mention that to your underwriter next time you’re applying for insurance as a space tourist.

Aaron Crowe is a freelance journalist who specializes in content about personal finance and insurance.

To Link To This Page
<a href=””>Can Space Tourists Get Life Insurance?</a>

Am I Covered?

Here’s a great article about Homeowners’ Insurance by Mary Snider, CLU, CPCU, State Farm® agent:

Some of you may be asking yourself, “Does my insurance coverage fit my needs?” “Do I have enough coverage to replace my home in the event of a serious loss?” “What affects my premium?”

These questions create a need for you to regularly review your Homeowners Insurance and to consider other questions such as: “Have you recently remodeled or improved your home?” “Has the rate of inflation risen since your last appraisal?” “What influences the building construction costs in your area?”

As you consider these issues, it is important to understand that real estate values measure the market value or selling price for a home. For insurance purposes, it is important to estimate the current replacement cost which is the amount needed to hire a contractor to repair the damage or to rebuild the home to its pre-loss condition. Dwelling replacement costs used by insurance companies do not include the value of the land. Market conditions in your area may impact the amount it will cost to rebuild your home if you experience a loss.

Building contractors or professional replacement cost appraisers are a good source for obtaining an estimated replacement cost for your home. Estimates from these sources should reflect your home’s specific features and details. If you are unable to obtain a detailed estimate from these sources, I can help provide an estimate.

Once you know the estimated cost to replace your home, you can decide how much insurance coverage fits your needs. You should also consider other policy endorsements such as back up of sewer and drain coverage, or additional coverage for personal articles with high values such as jewelry, fine arts, and collectibles.

You may want to consider higher personal liability coverage or the need for Flood Insurance which is provided by a separate policy. In addition to the amount of coverage you decide to purchase, your premium is impacted by optional endorsements you select, your claim history, the amount of your deductible, company longevity and multiple policy discounts such as home/auto.

Finally, remember to periodically review your insurance coverage with your agent. That will ensure you have the coverage you need.


If you have any questions, feel free to email me!


Bygones aren’t always… gone.

Here’s another great article from Steven M. Sushner. It gives some solid and prudent advice about how to protect yourself with Title Insurance.


What is Title Insurance and what does the Title Company do?

Simply put, Title Insurance is an insurance policy that insures a Lender or Owner of Real Estate property against loss in the event of an ownership dispute.
Different audiences often don’t understand what Title Insurance is and how it can benefit them.

One important distinction separates Title Insurance from many other lines of insurance:

Title Insurance provides protection from what might have happened in the past, whereas other types insure against what might happen in the future.

Continue reading

The Sandwich Generation: Part 1

Juggling Family Responsibilities

At a time when your career is reaching a peak and you are looking ahead to your own retirement, you may find yourself in the position of having to help your children with college expenses while at the same time looking after the needs of your aging parents. Squeezed in the middle, you’ve joined the ranks of the “sandwich generation.”

What challenges will you face?

Your parents faced some of the same challenges that you may be facing now: adjusting to a new life as empty nesters and getting reacquainted with each other as a couple. However, life has grown even more complicated in recent years. Here are some of the things you can expect to face as a member of the sandwich generation today:

  • Your parents may need assistance as they become older. Higher living standards mean an increased life expectancy, and you may need to help your parents prepare adequately for the future.
  • If your family is small and widely dispersed, you may end up as the primary Want to share your ideas? Post a comment, or send me an email!caregiver for your parents.
  • If you’ve delayed having children so that you could focus on your career first, your children may be starting college at the same time as your parents become dependent on you for support.
  • You may be facing the challenges of “boomerang children” who have returned home after a divorce or a job loss.
  • Like many individuals, you may be incurring debt at an unprecedented rate, facing pension shortfalls, and wondering about the future of Social Security.

What can you do to prepare for the future?

Check in tomorrow for some ideas about what you can do to be ready for whatever comes your way.


Want to share your ideas? Post a comment, or send me an email!

Other Points to Check as You Shop for Umbrella Protection

Photo by Deb Duncan

Is all your estate covered?

Homeowner’s insurance typically covers one or two homes, such as your primary residence and a vacation home. But if you want to cover more than that with an umbrella, or if you rent out a home, you may need separate underlying insurance.

Is your home-based business covered?

Most homeowner’s policies do not automatically cover home businesses, so an umbrella policy would not either. Alex Soto, an independent insurance agent in Miami, says your best bet may be to buy a separate home-based business policy or a regular commercial policy to get the coverage you need.

Are you on the Board of a non-profit?

Many homeowner’s policies do not cover claims arising from this kind of activity, and umbrella protection is iffy. Find out whether the organization has directors and officers insurance that covers you if you are sued as an individual, and ask what kinds of claims trigger coverage.

Make sure you discuss issues and other risks you face with your insurance agent. Disclosure of risks is the best way to make sure that you are covered later.

But it’s not just car wrecks that you have to worry about. Consider the following situations in which an umbrella policy could pay off: A friend breaks a leg after slipping on your basement steps; a babysitter is partially blinded when she is poked in the eye by one of your kids; your dog bites and disfigures a neighbor; a cyclist with whom you collide suffers a disabling injury.

An umbrella policy can extend your protection to situations in which you would otherwise not be covered. For example, unlike your basic auto insurance, it covers you when you rent a car in a foreign country, as long as you buy enough of the rental company’s liability coverage.

Most umbrella policies would also protect you if you were sued for liable, slander, defamation of character, or invasion of privacy. If you are wondering why you might need to worry about such things, note that cases have arisen among “friends” in social settings in which one person accused another of lying.

You might scoff that such scenarios are merely evidence of a lawsuit-happy society. But remember that even if a court ultimately rules that a suit is without merit, you still have to defend against it. That in itself can be expensive. Both primary and umbrella insurers have the obligation to defend you, even if a suit is determined to be frivolous, and in most cases they do it without cutting into the face value of your policy.

Whether you should buy an umbrella policy depends almost as much on your tolerance for risk as it does on the assets you want to protect. At some point as your assets grow you may need one; however, not having an umbrella policy is foolhardy.

Contact me today, and I’ll help you determine if you need an umbrella policy, and then help you find the policy that’s right for you.


Opening an Umbrella

Basically, umbrella policies sit on top of other insurance that includes liability protection, such as homeowner’s, auto and boat policies. When your primary insurance is not enough, the umbrella policy is triggered, spreading its protection (hence the term “umbrella”). Umbrella policies typically cover you and your family members who live with you for accidental injuries to another person or another person’s property.

The smallest policies (and the most common) pay up to $1 million per incident beyond what’s covered by the underlying policy. If you have $300,000 of personal liability protection on your auto policy and a $1 million umbrella policy, then under most policies you would have a total of $1.3 million worth of insurance standing between an injured party and your assets.

Umbrella-Georgetown: Photo by Deb Duncan

Claims against individuals rarely go that high. According to State Farm, which has 1.4 million umbrella policies in force, the average total payout in cases in which the policies come into play falls between $300,000 to $500,000.

The easiest way to buy an umbrella policy is through the same company that handles your homeowner’s or auto insurance. In fact, you may have to buy from the same insurer because some companies require that you purchase one or more underlying policies from them before they will issue an umbrella policy. Insurance companies also require that you maintain certain minimum levels of liability coverage on the underlying policies — perhaps $200,000 on an auto policy and $100,000 on a homeowner’s policy. The umbrella protection kicks in only when those levels are exceeded.

A mistake here could be costly. Say you buy your umbrella policy from your homeowner’s insurance company, and it requires that you maintain $300,000 worth of liability protection on your auto policy. If your liability protection under your car insurance is only $200,000, you might have to fill the gap – $100,000 before the umbrella will pay a cent.

Tomorrow, I’ll go over some of the things you should consider when shopping for an umbrella policy.


Do you need the Umbrella?

$$   You know the game: One person kneels behind another and a third pushes the “victim” over. Ina case settled last year, three 10-year olds were the players. One child broke his arm and the other two were sued. The case cost the kneeling boy $100,000 and the one who did the pushing $195,000.

$$   A 40-year old window washer broke his heel in a fall after a downspout he was holding onto broke away from the house on which he was working. Although the worker was found partially responsible, the fall cost the homeowner $1.2 million.

$$   A 22-year old suffered permanent eye damage when he was struck by a golf ball. He sued claiming that the golfer who hit the ball had failed to look out for other players. The errant shot cost the golfer $160,000.

$$   A professional dancer suffered permanent knee damage — an end to her career — when she was knocked down on a beginner’s ski slope. She offered to settle for the $300,000 covered by the defendant’s insurance, but was rebuffed. The case went to trial, where it cost the defendant $2.2 million.

$$   A woman suffered severe cuts when her leg was hit by the propeller of a boat she was attempting to board. She sued, claiming that the boat began to move before she was safely aboard. The injury cost the boat owner $175,000.

$$   At an end-of-school swim party, a 16-year old dove and hit his head on the bottom of the pool. He became a quadriplegic, and the case resulted in a $1.5 million settlement against the homeowner.

$$   A 5-year old suffered brain damage when a dinner bell at his grandfather’s home fell and struck him in the head. A lawsuit against the grandfather led to a $500,000 settlement.

Auto accidents cause most of the personal injuries that result in huge monetary settlements paid by umbrella liability insurance. But there are plenty of other calamities that can put your assets at serious risk.

Take this quick test to measure the risks you face. In most cases, the more often you answer yes, the more likely you need an umbrella policy. But for some people, one “yes” answer is sufficient to make them candidates for insurance.

  • Do you own your home or condo?
  • Is there a teenage driver in the family?
  • Do babysitters or cleaning people work in your home?
  • Do you have a swimming pool?
  • Do you ever leave your home in the care of a house sitter?
  • Do you regularly ferry other people’s kids around in your car?
  • Do you have a big or excitable dog?
  • Are you active in sports, such as golf, biking, skiing, or mountain climbing?
  • Do you own a boat?


Odds are you’ll never be sued for a million dollars. But what if you are?

It’s unspeakable, unthinkable: You, or your teenager, cause an auto accident that leaves a passenger in the other car permanently disabled. It gets worse: The injured person sues you for $1 million – and wins.DaliRainyCadillac; Photo by Deb Duncan

How could you pay that much? Your automobile insurance might cover part of it; say $100,000 to $300,000. What about the rest? You could lose almost everything for which you have worked a lifetime, and you could still be paying years from now, unless, of course, you’re among the growing number of people who own $1 million personal umbrella liability policies. In such a situation, an umbrella policy would kick in to cover the balance of the judgment, saving your assets.

If you think it’s unlikely that you’ll ever need such protection, you’re right. Accidents that result in claims for huge amounts are rare. That’s precisely why you can get $1 million worth of extra insurance for $100 to $300 a year.  Fireman’s Fund, for example, reports fewer than 40 claims a year on its 40,000 personal umbrella policies.

But it takes only one brush with tragedy to ruin you. “Severity, not frequency, is the critical point,” says Naig Neville, an insurance consultant in West Bloomfield, Michigan. He calls umbrella liability policies “peace-of-mind insurance.”

Don’t think efforts in Congress to reform the legal system, including a possible cap on punitive damages in some type of cases, will reduce the risk. The proposed changes wouldn’t apply to most suits brought by one individual against another.


Robert Hunter, director of Consumer Federation of America’s Insurance Group and former Texas insurance commissioner points out, “The more significant the assets, the more advisable the insurance.” In other words, a kid who owns nothing more than an iPod isn’t going to buy an umbrella policy; but someone with a home, car, and other investments stands to lose much more without umbrella protection.

The need depends on your vulnerability,” says William Warfel, professor of insurance and risk management at Indiana State University.

When assessing whether or not you’re vulnerable, begin by considering that the vast majority of claims under umbrella liability policies – 80% to 90% at one company – spring from auto-related incidents. If you drive a car, then you’re at risk.

Check back tomorrow to learn how to open an umbrella policy.