I know you’re all sitting up late at night wondering how to explain the Risk Based Capital (RBC) score to your customers, so here we go! RBC is a score used by state regulators to determine if an insurance company has enough capital to support the policies it has issued. Capital is money in the bank, also known as surplus. Not only is the RBC analysis a warning system for regulators, the Office of Insurance Regulation (OIR) must take certain...

I love esoteric endorsements, especially ones that are badly named, and this one’s a doozy.  Not only do most people not know there’s a coverage gap that this endorsement is designed to fix, if they do know about it, they fall for the name. Everyone knows that theft is one of the covered Named Perils for contents in the HO3.  The description of the covered peril of theft, however, includes some interesting limitations.  What’s covered...

Sometime when you’re “getting around” you’re also getting in other people’s way!  Let’s look at how the 1991 HO3 protects Insureds who injure someone or damage property while getting around.  Insureds First, who gets this coverage?  With respect to vehicles covered under the HO3, who is an Insured is expanded to include: Persons engaged in your employ (meaning they’re doing work for you at the moment), resident relatives, and...

Can you hear the Beach Boys’ music?  Depending on your age, maybe not!  There are a lot of ways for your clients to “get around,” and if they have homeowners and auto policies, then I’ll bet they’re assuming they’re covered by one policy or the other.  Let’s take a look at what property coverage the Insured has on a 1991 ISO HO3 for the machinery they use to get around. Various vehicles and motorized land conveyances are covered...

Well you don’t, but the Feds do.  Before I get into that, can I just say that I think there’s a competition between the government and the insurance business to see who can come up with more acronyms.  So far, I think it’s a push. The Office of Foreign Assets Control (OFAC) of the U.S. Treasury Department administers economic and trade sanctions based on U.S. foreign policy and national security against targeted foreign countries,...