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IPS / Lighthouse Insurance Group Blog: homeowner insurance

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With more and more families every year having both parents work full time, there has been an increasing need for help around the house with childcare and chores like cleaning, laundry and running errands. If you’re hiring household help it’s important to understand how having domestic workers (including nannies, housekeepers, caretakers, etc.) around your home can impact not only your insurance coverage- both your auto and your homeowners- but also how it could have tax implications for you. If you don’t understand these issues, the result could be something quite atrocious. 

Who’s The Boss?

No, not Tony, not Angela and not even Mona. You are the boss. Yes, that’s right- though you may not immediately think of it in those terms, if you hire a full time nanny or house keeper they will most likely be considered your employee. The IRS has criteria to help you determine who is and isn’t an employee, which can be found on their website. If your housekeeper or nanny is your employee, you are responsible for verifying their employment eligibility and paying employment taxes (notably, failure to do this has prematurely ended the careers of several politicians in the past few years). It’s important that when hiring help around the house that you determine these things up front so that you can comply with the law and avoid having to pay penalties or fines down the road. Just like you have a Trusted Choice® Independent Insurance Agent to help you with your insurance, you should contact a tax professional with questions on the tax implications of hiring household help.

Do I need to provide my household employee with Worker’s Compensation Coverage?

It really depends on what state you live in, but most states exempt household employees from the worker’s compensation laws. However, you may have more peace of mind if you choose to provide this type of coverage voluntarily.  In most cases, your homeowner’s insurance policy would provide household employees with some medical payments if they were injured during the course of their work, but it may not be adequate depending on the injury.  Unless prohibited by your states worker’s compensation laws, you can voluntarily purchase a worker’s compensation policy to cover your household employees, which could provide you with some immunity from having your employee take action against you under most states worker’s compensation laws. Some states though will not allow you to enter the worker’s compensation system while at the same time exempting you from the worker’s compensation laws, in which case there is additional coverage you can add to your homeowner’s policy. This additional coverage is called the “Voluntary Compensation and Employers Liability Coverage for Resident Employees Endorsement.” Because these scenarios will vary from state to state, it’s best that you review your situation with your Trusted Choice agent, who can help you decide the best way to provide coverage for your household employees.

Are household employees covered by my auto insurance?

Whether it’s a housekeeper running to the store for more cleaning supplies or a nanny picking your kids up from school, chances are that at some point a household employee will use a car that you own.  The good news is that coverage follows the vehicle, and so your auto policy would provide coverage if your employee was found liable for an accident in your vehicle.  There would also be coverage if your employee was injured- unless you have worker’s compensation for them, in which case that would be the policy that would provide them with coverage.
If your household employee is driving their own vehicle they would have coverage under their own auto policy, but more importantly, so would you if they were found liable for negligent actions in the course of driving their own car while performing employment related duties. With the potential that you might be held liable for the actions of your employee, it’s critical that you know what kind of insurance coverage they have.  If your employee is providing child care, you also want to make sure that their auto policy has appropriate amounts of coverage for your children in the event they are injured in an accident while in the nanny’s car. If they’ll be driving their own car, strongly consider requiring that as a condition of their employment that they have enough coverage that you feel comfortable with. A Trusted Choice agent can help obtain coverage that works for both you and your employee.

Are household employees covered by my homeowners insurance?

Some of that depends on whether the employee lives with you in your home. If you furnish a nanny or housekeeper with living quarters, contents that you own and provide to them to use, such as furniture, would be covered. As long as they’re staying in your home as part of their employment (and don’t have a separate rental agreement with you) your policy would also provide some coverage for any personal items that they bring with them, but the policy will only provide coverage up to a certain amount, so for valuable items, such as jewelry or electronics, you want to make sure any live-in employees also carry their own insurance for their possessions.
If your household employee does not live with you, there are still other parts of your homeowner’s policy that could be impacted by their status as your employee. In several lawsuits across the country household employees have sued their employers for invasion of privacy for the use of so-called “nanny cams,” which are hidden cameras in the house to record the employee’s behavior. Many homeowner/employers see the use of these cameras as a way to monitor potential abuse of trust on the part of an employee. Because a standard homeowner’s policy only provides liability coverage for property damage and bodily injury, you should make sure that you ask your Trusted Choice agent about adding a “Personal Injury Endorsement” to your homeowner’s policy to give you additional protection from this type of action. 
A standard homeowner’s policy may not provide coverage to your household employee though if they were sued while working for you except in very limited circumstances. Therefore it’s important that both you and your employee understand that they may want to have their own liability insurance – either a commercial liability policy or business owners policy. Their own personal homeowners or renters insurance wouldn’t apply since they preclude business activities. 
The Magic of an Umbrella
Finally, having what’s known as a personal umbrella policy can help sooth some of the anxiety of household employees. Like the name implies, umbrella policies offer additional coverage above what is typically in a homeowner’s or auto policy. While personal umbrella policies are not uniform from one insurance company to another, they’re worth looking into for the additional coverage for you and your employees.
Families that hire household help should be aware of the implications of having someone working for them in their home. Having a Trusted Choice Independent Agent to help you understand these issues could be just the spoonful of sugar you need to help the medicine go down.

Call Insurance Planning Service today at 800-220-5582 or use our convenient contact form to make sure you have adequate insurance coverage when hiriing that household help!  We're your Trusted Choice Agency representing Livonia area and it's surrounding communities. 

Article Source: Trusted Choice
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As online communications and electronic commerce continue to grow, identity theft has reached new criminal proportions. Identity thieves now do much more than simply steal credit card numbers from discarded paper receipts; they use sophisticated computer technologies to illegally obtain your financial assets and can potentially ruin your credit history.

Identity thieves steal personal identifying information, such as names, addresses, date of birth, social security numbers, credit card numbers and driver’s license numbers, and use this personal information to fraudulently obtain cash and credit, goods, services and other property, including insurance policies.

Some of their criminal tactics include opening phony bank accounts or stealing from established ones, obtaining unauthorized credit cards and insurance policies, applying for car or house loans, and leasing apartments with false names.

Here are 10 tips that can help in preventing Identity Theft.

  1. Shred or tear up personal financial documents before discarding them.

  2. Do not print personal identifiers such as your social security number, date of birth or driver’s license number on your checks.

  3. Use your social security number only when necessary.

  4. Before revealing any information online, ensure the website is securely protected (a yellow padlock symbol will be present in the corner of your computer screen on secured websites).

  5. Before revealing any information to another person, ask how it will be used.

  6. Do not provide personal, financial or identifying information to an unknown telephone caller.

  7. Pay attention to billing cycles. Identity thieves may reroute bills to another address to hide criminal activities.

  8. Carefully review your monthly credit card statements, checking for any unauthorized use.

  9. Obtain a copy of your credit report at least once a year to check for errors.

  10. Minimize the number of cards and identifying information you carry, especially your social security card and passport.

It pays to be cautious with any information about yourself.  And, you should be aware that insurance coverage is available on most Michigan homeowners insurance policies and some business insurance. policies that can pay for expenses associated with recovering stolen identity.

The professionals at Insurance Planning Service, can let let you know what is available on your policy.  Call us today at 800.220.5582 or contact us on the web using our simple contact form.

Article source: National Insurance Crime Bureau
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Water in the wrong places in your home can create a real mess and result in very costly repairs.  We recommend these few tips to help avoid problems from water.
  1. Roof. Repair or replace shingles around any area that allows water to penetrate the roof sheathing, particularly common around chimneys, plumbing vents, and attic vents.
  2. Gutters.  Gutters should be cleaned a minimum of twice a year and downspouts should be angled to flow away from the house.
  3. Windows. Check all the windows in the house and ensure that seals are tight.  Replace caulk as necessary to avoid water seepage.
  4. Hot Water Heater.  Check the hot water heater for leaks and corrosion.  Rust is a sign of imminent tank failure.
  5. Washing Machine Connections.  Inspect waching machine hoses and check for signs of brittleness or corrosion.  Experts recommend changing standard rubber hoses to stainless steel reinforced hoses which will reduce the likelihood of leaks and guarantee a longer life.
  6. Grade Around the House.  Make certain to have a positive grade away from the house so that water doesn't puddle and run down the foundation wall.
  7. Plumbing.  Check for leaking faucets, dripping or "sweating" pipes and clogged drains. In the kitchen, regularly examine the icemaker, dishwasher, sink and garbage disposal for leaks and replace these hoses every 5 years.  In the bathroom, inspect the shower stall for leaks and inspect for old or brittle caulking.  Check the sink and toilet.  Water stains around the toilet may be an indication of damage to the rim and tank seals.
  8. Exterior Faucets.  Exterior faucets need to be winterized.
  9. Main Shut-Off.  Make certain everyone in the family knows where the main shut-off is and how it works.

Doing all the right things to prevent water damage from happening doesn't guarantee that accidents won't still happen.  For those situations that couldn't be prevented, make sure your Michigan homeowners insurance policy is up to date.  The professionals at Insurance Planning Service are happy to help you review.  Call today at 800-220-5582 or contact us via the web. 

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OopsWe are all concerned with saving money and it is important to shop around when looking for insurance coverage. However, simply reducing your coverage or dropping important coverages altogether can leave you dangerously underinsured in the event of a disaster.
Following are the five biggest auto, home, flood and renters insurance mistakes consumers can make, along with suggestions to avert those pitfalls while still saving money:
1. Insuring a home for its real estate value rather than for the cost of rebuilding. When real estate prices go down, some homeowners may think they can reduce the amount of insurance on their home. But insurance is designed to cover the cost of rebuilding, not the sales price of the home. You should make sure that you have enough coverage to completely rebuild your home and replace your belongings.
A better way to save: Raise your deductible. An increase from $500 to $1,000 could save up to 25 percent on your premium payments.
2. Selecting an insurance company by price alone
. It is important to choose a company with competitive prices, but also one that is financially sound and provides good customer service.
A better way to save: Check the financial health of a company with independent rating agencies and ask friends and family for recommendations. You should select an insurance company that will respond to your needs and handle claims fairly and efficiently.
3. Dropping flood insurance. Damage from flooding is not covered under standard homeowners and renters insurance policies. Coverage is available from the National Flood Insurance Program (NFIP), as well as from some private insurance companies. Many homeowners are unaware they are at risk for flooding, but in fact 25 percent of all flood losses occur in low risk areas. Furthermore with the significant snow fall this winter, spring related flooding may be particularly severe, thus increasing the importance of purchasing flood insurance.
A better way to save: Before purchasing a home, check with the NFIP to determine whether the property is situated in a flood zone; if so, consider a less risky area. If you are already living in a designated flood zone, look at mitigation efforts that can reduce your risk of flood damage and consider purchasing flood insurance. Additional information on flood insurance can be found at
4. Only purchasing the legally required amount of liability for your car. In today’s litigious society, buying only the minimum amount of liability means you are likely to pay more out-of-pocket if you are sued—and those costs may be steep.
A better way to save: Consider dropping collision and/or comprehensive coverage on older cars worth less than $1,000. The insurance industry and consumer groups generally recommend a minimum of $100,000 of bodily injury protection per person and $300,000 per accident.
5. Neglecting to buy renters insurance. A renters insurance policy covers your possessions and additional living expenses if you have to move out due to an insured disaster, such as a fire or hurricane. Equally important, it provides liability protection in the event someone is injured in your home and decides to sue.
A better way to save: Look into multi-policy discounts. Buying several policies with the same insurer, such as renters, auto and life will generally provide savings.

Source:  Insurance Information Institute

Standard Michigan homeowner insurance policies have coverage limitations for many items in the home due to the nature of what they are.  Some limitations can be in the form of a specified dollar limit for certain causes of loss, in other cases items may not be covered for breakage, and yet others may be excluded from the replacement cost provisions that otherwise apply for your home contents.  In all cases, if covered by the standard homeowner policy, your deductible will apply.

We can arrange for special coverage as a separate “floater policy” or as an endorsement or rider on your homeowner policy.  While there are still exclusions, this special coverage will eliminate most of the limitations, broaden the scope of coverage, and eliminate the deductible!  And, it will assure you of being compensated for the item’s true value.  The really good news is that the cost to insure for most collectible items may be much less than you think! 

Just look at the kinds of items we have insured for our customers…

~ Advertising Memorabilia
~ Animation Art
~ Antiques
~ Automotive Memorabilia
~ Books (rare)
~ Bicycles
~ Cameras
~ Carousel Animals
~ Ceramics
~ Clocks (antique/collectible)
~ Crystal / Glass
~ Comic Books
~ Coin Collections

~ Die Cast Cars/Trucks
~ Dolls
~ Figurines
~ Fine Arts
~ Furs
~ Guns
~ Holiday Collectibles
~ Jewelry
~ Juke Boxes/Arcade Games
~ Military Memorabilia
~ Miniatures/Doll Houses
~ Model Trains & Layouts
~ Movie Memorabilia

~ Musical Instruments
~ Pottery & Collectible Plates
~ Prints (limited editions)
~ Quilts (antique/collectible)
~ Radios/Victrolas
~ Sports Equipment
~ Sports Memorabilia
~ Stamp Collections
~ Teddy Bears
~ Toys & Action Figures
~ Trading Cards
~ Wine & Accessories


Call us at 734.421.9900 or contact us online for more information on insuring your precious possessions and find out how inexpensive it can be for you to do it right!

Richard D. Bernard, AAI, CIC

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Lighthouse Group Main Office in Grand Rapids, MI
Mailing Address | P.O. Box 530009, Livonia, MI 48153

Phone: 734.421.9900 | Toll Free: 800.220.5582 | Fax: 734.421.9911

Also serving these Detroit area communities in Michigan: Livonia, Farmington Hills, Ann Arbor, Southfield, Plymouth, Canton, Westland, Northville, Novi, Dearborn, South Lyon & Walled Lake