Column: Insurance premium is for the dogs

Feb 15, 2012

The following article was published in the Fort Myers News-Press on February 15, 2012:

Insurance Premium is for the Dogs

By Melanie Payne

The 28 percent increase in Lorraine Renosis homeowners’ insurance premium got her attention. When the cost for her Fort Myers condo went from $306 to $393, Renosis looked for ways to save on her insurance.

That’s when she found she was paying $25 for dog liability. The condo was also covered for “weight of ice, snow or sleet; freezing; and volcanic eruption,” and “grave markers.”

“It’s reassuring to know we are covered,” Renosis said sarcastically.

Renosis didn’t see specific costs associated with ice, lava or grave marker damage, but the dog liability was broken out. So she asked her agent to drop it.

Her insurance agent faxed the request to Bankers Insurance Group of St. Petersburg. But the reply Renosis received was confusing. The coverage could only be removed for policies effective after Jan. 1, 2012. Renosis’ policy was renewed in December 2011.

“Why would I have to insure for a dog I do not have,” she asked. Or ice build-up, a volcano or grave marker, for that matter?

Judy Copechal, vice president of product management for Bankers (which in Florida operates under First Community Insurance Co.), explained it to me.

Homeowners’ policies have standard coverage packages that are much the same for all. She said to think of it like a big screen plasma TV with a USB port to which you can hook up your computer. You may never use the port, but you can’t tell the retailer to take out it so you can buy the TV for less.

It’s the same thing with insurance. You can’t take out the volcanoes or the grave markers. And before Bankers changed it last year, you couldn’t drop the dog coverage, either.

Copechal said the company applied for a rate change — which included this dog liability protection option — and it was quickly approved by the Florida Office of Insurance Regulation.

The office, however, was not so quick to approve the contract language that Bankers submitted to go along with the rate change. That took 246 days, according to Copechal.

“While we got the rate side approved, we had no ability to remove the coverage from the contract until the (Office of Insurance Regulation) approved the forms,” Copechal said.

According to the Florida OIR records, the forms’ approval took 240 days. But a difference of six days is the only point Amy Bogner, deputy director of communications, and Copechal disagreed on.

The real holdup came because of property insurance bill SB 408.

When the governor signed the bill into law in May, the forms Bankers submitted for approval in March had to be revised and resubmitted. This was done nine times before the forms complied with the changes in the Florida statute. Hence the delay.

Among Bankers’ customers, Renosis was not alone in her confusion over the dog charge, Copechal said. Other customers have also contacted the company.

One solution is to cancel the insurance and have it rewritten with a current effective date. But that’s a lot of hassle to save $25 a year.

And I think Renosis might want to consider leaving the dog liability coverage in place. That way she would be covered if she were dog-sitting or a friend comes over to visit with a dog and the dog bites someone. Sure, it’s unlikely, but that’s why we have insurance – to cover us in case something we were not expecting to happen, does.

Wachovia to Wells Update

Last Thursday, I wrote about a customer’s troubles using her old Wachovia routing and account numbers for online payments from her Wells Fargo account. When Wells Fargo took over Wachovia, it assured customers this would be no problem, but the woman’s payments were being returned for nonsufficient funds.

“We believe this is an isolated issue as we have not heard from other customers having a similar problem,” a Wells Fargo spokeswoman told me.

I asked readers to let me know if they, too, were having issues using their Wachovia numbers for Wells Fargo payments. I received 11 emails, two phone calls and one letter from readers with “a similar problem.”

So, it’s not isolated. But it’s fixable.

Customers should stop using the old account numbers, shred their Wachovia checks and get new Wells Fargo checks. I know it’s a hassle and costly. But so are the late fees and shut-offs from creditors who aren’t getting paid.

And if you’re mad at Wells Fargo about this, find a new bank or join a credit union. Because you need to change all your account information and get new checks anyway, now is as good a time as any to exercise your consumer power and vote with your feet.

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