Vargas & Vargas Insurance

1133 Washington St
Dorchester, MA 02124

 Get Directions

How to Protect Your Personal Assets When You’re a Landlord

Let’s say that you inherit or purchase a house and end up with two properties. At this point, you have some very big decisions to make. You can sell the extra home or use it as a rental property. Either choice can have immediate benefits, but with rental properties, you have risks as well. These risks may include lawsuits and claims for personal injuries or damages to your tenants. Therefore, before you decide to start your new job as a landlord, we suggest you prepare for the ‘what-ifs.’ You need to know how to protect your personal assets when you’re a landlord. 

homeowner evaluating how to protect his rental property on his home computer

Understanding Your Risks as a Landlord

There are some things that you cannot be held liable for as a landlord. If your tenant suffers a personal injury while jumping on a trampoline that they brought on the property, you most likely will not be held accountable for it. This is especially true if you were unaware that they had a trampoline or you felt that they were grown up enough to play safely while on it. 

The problem arises when you, as a landlord, know that there is a risk of danger to the property or the people who are renting from you. For instance, you may be held liable if:

  • You know that dangerous animals or pets are nearby.
  • You are aware of improper maintenance, water damages, or faulty wiring issues and fail to repair them.
  • You know that criminal activity in the area creates a risk for the personal safety of your tenants.
  • You are aware that the home is in violation of local laws or building codes.

As a property owner for a rental property, you have to fix the issues that you know are there. The shortlist above is only a few of the things that you could be held accountable for. 

How to Protect Your Assets as a Landlord

To protect yourself, you must put effort into securing your personal property. This can be done in several ways. Some of the most common include:

1. Create an LLC for Your Business

The term LLC means that you are a limited liability company. Many homeowners don’t think about the fact that they are a business when they become a landlord, but it’s something to consider. LLCs give you protection from potential problems. The term LLC basically gives you a buffer so that a tenant cannot go after your personal assets — just the business’s assets. 

2. Hiring a Skilled Property Management Company

When you have rental properties, you may not know all that you are responsible or accountable for. A property manager can help you sort through applicants, avoid fair housing violations, and more. They have a full understanding of what is involved and can help you ensure your property is operating legally in every way. 

3. Limit Potential Areas of Liability

If you know that there is a particular risk involved with the property, do everything you can to lessen it. For instance, if you know there is a family of feral cats roaming near your property, contact animal control to help you catch them. Remember that storm last year? If there is any chance that it caused roof damage, have the roof inspected before you rent it out. The more prepared the property is, the safer you will be.

4. Protect Your Assets with Insurance Coverage

When you have a rental property, you need to protect yourself with proper insurance. The minimum protection for you should come from adding a rider or extension to your home insurance. It can help you cover the cost of something going wrong with your rental property. An umbrella policy may also be wise since it can protect you from possible lawsuits.

Along with this, it is important that you inform your tenants that your policy does not cover them. They should purchase their own insurance to protect their personal property. 

If you would like more information on your options as a landlord and protecting what is yours, we are here for you. You can contact us anytime for a quote. Vargas & Vargas is also available via phone calls or text. If you need help during business hours, call us at 617-298-0655.

Read More

Paying for your insurance during COVID-19 Crisis

Paying for your insurance during COVID-19 Crisis video

Some of our insurance companies are offering leniency guidelines for the payment of premiums due to the COVID-19 virus. The premium leniency varies from company to company and not all carriers are offering assistance.
 
If you are in need of payment assistance or have any questions, please contact our office with an email to customerservice@vargasinsurance.com or by calling our office at 617-298-0655 and asking for a customer service representative to obtain details on your specific insurance company.

Or, Click here to access our online customer service center available 24 hours a day 7 days a week to view your insurance policies, print insurance ID cards, update your contact information, download documents, and so much more.

We recommend you contact us with any questions or concerns you may have regarding your policy with Vargas & Vargas Insurance. 

Please remember that should you suffer an AFTER HOURS emergency that cannot wait until we open up for business, call our 24 hours 7 day a week emergency number: 617-322-5289.

We look forward to the day that we can open our doors and you can visit our offices.  

Stay healthy, remember our elderly neighbors!

❤️

Carloscvargas@vargasinsurance.com
www.vargasinsurance.com
617-298-0655

Read More

Home Insurance FAQ: Purchase Price vs. Replacement Cost

couple looking up home insurance information in their kitchen

Here at Vargas & Vargas Insurance, our goal as licensed insurance agents is to provide competitive homeowners insurance policies to Massachusetts families. Part of our job is educating first-time homebuyers and investors about how homeowners insurance works. 

This article is going to address a home’s purchase price versus replacement cost as it pertains to insurance. We’re also going to answer two specific questions we get all the time:

  1. Why am I insuring a home for replacement cost instead of the purchase price?
  2. What is “dwelling replacement cost,” and how does it work?

Why Am I Insuring a Home for the Replacement Cost, Not the Purchase Price?

Homeowners insurance is designed to help you replace a home and its contents from the ground up in the event of a loss.

Imagine your home burns down to the ground. Homeowners insurance is there to rebuild that home completely and replace your belongings. Replacement cost is our best estimate of what it will take to rebuild that home, in your neighborhood, per square foot.

However, it’s important to know that the purchase price of a home is not equal to replacement cost. Purchase price includes the land the dwelling is sitting on, for example, which doesn’t need to be replaced after a fire.

What Is Dwelling Replacement Cost, and How Does It Work?

We figure every dwelling’s replacement cost individually with a formula: square footage by replacement price (sqft x rp). Replacement price depends on factors like:

  • Your location
  • Current labor costs
  • The expense of materials like wood, brick, carpet, and roofing

As a result, dwelling replacement cost changes from time to time. We also consider:

  • Special enhancements like moldings, architectural finishes, columns and more
  • Fireplaces and stonework
  • Systems like central heat and air, central vacuuming, and sprinkler systems
  • Anything else special or unique about your home

In many cases (but not all), a home’s replacement cost is higher than the purchase price. This is good news for you as a buyer. If there is a total loss, you will come out financially ahead if you have a mortgage.

If you’re buying a home for the first time, congratulations! It’s a tremendous accomplishment. The staff at Vargas & Vargas Insurance is ready to help you get the homeowner’s insurance you need. Reach out to us today at 617-409-0329 for a homeowner’s insurance quote, and check out our blog for more great Massachusetts insurance topics.

Read More

Making an Informed Choice About Accessing the Cash Value of Your Life Insurance Policy

It’s important that you’re well-informed before you access all or part of the cash value of your life insurance policy. After all, you took out the policy to provide for your survivors. That’s why the agents at Vargas & Vargas Insurance work hard to have the answers our clients are looking for. You need to know what impact accessing these funds could have on their future and your own. 

couple sitting in their house and discussing life insurance policy options

Life Insurance Policies that Accrue Cash Value

Cash value life insurance policies are sometimes referred to as permanent life insurance policies. This category includes whole life, universal life, and variable life. One of the biggest differences between these policies and term life insurance is that the latter policies do not accumulate cash value.

Common Ways to Access Cash Value

Policy Loan

Benefits: The life insurance company may offer you a lower interest rate than you can get with a conventional bank loan or by taking a cash advance on your credit card. A policy loan does not qualify as taxable income. You’re typically not required to repay the money since you’ve basically borrowed your own funds.

Drawbacks: However, policy loan repayment is to your beneficiary’s advantage. After death, the insurer usually deducts the amount you borrowed and the accumulated interest from the death benefit.

Withdrawal

Benefits: When the amount withdrawn is not greater than the total of paid premiums, the withdrawal is not taxed. The rules governing a withdrawal depend on your policy. Some policies allow dollar-for-dollar withdrawals.

Drawbacks: With other policies, a withdrawal reduces the death benefit by an amount greater than what the policyholder withdrew.  Withdrawals that exceed premiums paid are usually taxed.

Policy Surrender

Benefits: You’ll receive the policy’s cash value. 

Drawbacks: Your insurer may charge a surrender fee. If you owe any debt from policy loans, the insurer also subtracts your debt from your cash value. Generally, the income from a policy surrender is taxable. Most importantly, you’re effectively canceling the policy. Your survivors will not receive a benefit from the policy.

We’ve provided this information as a general introduction to accessing the cash value in your life insurance policy. If you have specific questions about life insurance policies, contact our team for assistance.

Read More

Does Commercial Insurance Cover Storm Surge Damage?

People often get confused when referring to storm surge damage as opposed to flooding. Storm surge creates damages as a result of the force of the water pushing and pulling a structure, whereas flood damage occurs with inland flooding and standing water. 

Storm Surge Damage

When it comes to storm surge damage, most commercial insurance policies directly cover this type of damage. Although the damage stems from water, it isn’t classified as flood damage. Anyone who lives near a coastline or waterway adjacent to an open body of water that experiences storms should make sure their commercial policy mentions this type of protection specifically to help prevent losses when a storm occurs.

Getting the Right Policy

Finding the right commercial insurance policy can be tricky, which is why it helps to use reputable insurance agents who have agents with insight and experience helping clients get the right coverages. Anyone who lives near the Dorchester, MA area, should sit down with an agent from Vargas & Vargas Insurance to find out what options are available and can help protect from threats such as storm surge damages. With an agent to assist you, losses and gaps can be minimized and you get greater peace of mind knowing that you are covered. 

Don’t guess when it comes to selecting commercial insurance coverage that will protect property from storm surge damage. Call or stop by Vargas & Vargas Insurance, serving Dorchester, MA to find out what policy terms and conditions outline and how to find a policy that matches current and future needs. Agents are ready to help serve clients to give them ultimate protection. 

Read More

What You Need to Know About the Keeping American Workers Paid and Employed Act

entrepreneur working at home in her kitchen due to COVID-19 and reading about the Keeping American Workers Paid and Employed Act

The forced indefinite closure of many small businesses throughout the nation has caused many owners uncertainty about their ability to retain employees and successfully reopen following the COVID-19 pandemic. The Keeping American Workers Paid and Employed Act, which was passed on March 27, provides emergency funds to qualifying businesses with a maximum of 500 employees. 

What Is the Keeping American Workers Paid and Employed Act? 

The Keeping American Workers Paid and Employed Act is a $377 billion package of grants and loans intended to help keep small businesses across the nation functional during and after the COVID-19 pandemic. The Paycheck Protection Program, the largest section of the act, provides small businesses with loans that are to be used to continue paying employees while businesses are closed. These loans may be obtained immediately through over 800 SBA-certified banks and credit unions. Other aspects of the act include:

  • Entrepreneurial assistance.
  • Emergency EIDL grants.
  • Small business debt relief. 

Paycheck Protection Program

Under the Keeping American Workers Paid and Employed Act, the Paycheck Protection Program will provide loans to qualifying small businesses. The amount can be as great as 250 percent of the business’s total monthly payroll. It provides temporary funds to cover employees’ salaries, tips, and benefits. In doing so, the act hopes to minimize the financial difficulties that both employees and the small business will face in the coming months. 

Other Elements of the Keeping American Workers Paid and Employed Act

The act also includes several billion dollars in funds that may be used to grant immediate relief to qualifying businesses. This section allows for:

  • Up to $10,000 through the EIDL program.
  • The provision of counseling, training, and other services to struggling businesses.
  • The provision of sick leave.
  • Easier access to other loan programs.

Many small businesses will need to adjust how they handle their finances in the coming weeks and months in order to successfully reopen and stay open. However, the emergency funds provided by the Keeping American Workers Paid and Employed Act make it easier to pay bills and employees. By keeping employees paid throughout the pandemic, businesses keep their employees’ financial struggles to a minimum and increase their likelihood of returning instead of searching for new positions.  

Read More

CARE Act and Economic Injury Disaster Loan

The CARES Act was signed into law today. The SBA Economic Injury Disaster Loan (EIDL) program has been accepting applications for about three weeks. The EIDL application is complicated and requires extensive information to be submitted both at the application stage and during the process of the loan request.

EIDL provides up to $2Million and rates are: 3.75% 30yrs PROFIT Businesses; 2.75% 30yrs NON-PROFIT Organizations

ALL business owners negatively impacted should immediately apply for EIDL assistance. You can find the application on SBA.gov and click on the amber-colored COVID-19 banner at the top of the page. Download the
application forms, complete and sign, and upload with accompanying documentation. Be thorough for the best chance of speed and success. ALSO: check off ONLY EIDL financing otherwise your application will be held up.

From our CPA James Henderson, “there are many solutions for business owners.  Some are external.  Like loans, SBA or otherwise, loan modifications, tax credits, grants and vendor/landlord accommodations.  Some are internal, like expense management, cash flow projections/management, client revenue deferral, new service offerings, and staff lay-offs.  This crisis times scream for a holistic coordinated/planned approach, rather than a knee-jerk “get a quick loan for cheap” approach”

“I have viewed many of the seminars regarding the SBA EIDL and CARES act financing, and have several clients engaged in the process.  One thing that has come up over and over again is the necessary involvement of the business owner’s CPA valued advisor to get the right program in place depending on a client’s particular circumstance.  There are payroll tax credits available for retaining your workforce.  And with some deeper dive, probably a lot more.”

If you do not work with a CPA, our friends at Aurora Consulting are offering free advice and an affordable consulting fee if a business needs their direct assistance to collate the information and complete and submit the application to SBA. SBA allows a consulting fee up to $2500 maximum. Linda and Trevor have agreed that they will charge only $750.00 as their consulting fee to complete and submit an EIDL application. They will accept a $250.00 upfront payment with the balance due later at a date to be agreed upon by both parties. They don’t want to negatively impact your already-strangled cashflow and are willing to work with anyone who needs their assistance. Basic advice and guidance is free of charge.

They attended a webinar provided by the Governor of Connecticut, Ned Lamont, to discuss the basics of the CARES Act to provide assistance to business owners.  

Here are highlights from the webinar with more to follow in another newsletter soon:

CARES Act website is not active yet

SBA.gov website does not yet have CARES Act information 

Programs will not be available for a week or two

It is recommended to apply for BOTH EIDL and CARES Act financing. Get the applications in process. Once a determination is made for approval, you should then choose which of the two loans works best for your needs.

CARES Act Loans are basically an SBA 7a Loans up to $5MM, short term loans that will be converted to grants if you retain employees.

Employee Retention: this has been most actively discussed in the media and seems to be a priority of the CARES Act financing options. That leads to other questions about how to qualify and that aspect remains to be seen based on the soon-to-be-released CARES Act guidelines from SBA

RECORD KEEPING: Step up the quality of your record-keeping in terms of Employees and Operating Expenses. A mention was made that “forgiveness” of the loan will be decided after an interview and query for proof or Employee retention and that funds were used for Operating Expenses.

SBA does not yet have a timeline when the Lender guidelines will be available to follow for lending but there is an urgent priority within SBA to coalesce the information from the CARES Act and to get information to SBA Lenders

501C3 organizations are eligible under EIDL and CARES Act 

500 employees or less

They are looking to access the Small Business Owners Guide for CARES Act which should be available tonight and we will share pertinent information with you in other email newsletter updates

Linda and Trevor have been fielding calls and queries from anxious business owners all week. They are doing their best to parse the information and get ACCURATE information to you. We strongly recommend you slow-down your decision-making. We’ve already seen some business owners making bad decisions to obtain capital out of desperation. We use the phrase “EVER-EVOLVING” to describe the lending atmosphere in general, and the emergency programs specifically.

Please contact Aurora Consulting and mention that you received this message from us, please SHARE this email with anyone you feel may find the information useful.

Please reply to this message should you have any additional questions!

Read More

The Essential Insurance Checklist for Massachusetts Restaurants

The Massachusetts restaurant industry is thriving, and you have invested substantial time and money into launching a successful eatery. It is important to protect your investment, but the dining industry poses certain risks that may not be covered by standard commercial property, general liability, or workers’ compensation insurance policies.

Owner of a restaurant standing in the doorway of her restaurant

Restaurant entrepreneurs should be aware of several specialized coverages available to them:

  • Product Liability Coverage: The food-service industry demands rigorous health and safety standards. However, even with sound food-handling protocols, foodborne illness may strike and make guests ill. Also, cross-contamination in the kitchen may trigger allergic reactions in some diners. Product liability coverage can help insure against claims made by guests who become ill from eating at your restaurant.
  • Equipment Breakdown Insurance: Restaurant equipment can be expensive to own, lease, maintain, and repair. Unfortunately, this expensive equipment can break down or fail as a result of weather events or a power surge. Equipment breakdown insurance can help you cover out-of-pocket costs associated with certain instances of equipment failure.
  • Food Contamination Coverage: This insurance may protect against losses arising from spoilage resulting from mechanical or power failure.
  • Liquor Liability Insurance: If you serve alcohol, you should already maintain the liquor liability insurance required by Massachusetts law. However, you will want to check your limits and exclusions and make sure you are covered for both your on-site and catering activities.
  • Loss of Business Income Insurance: If your business is closed for any period of time because of property damage or severe weather, loss of business income insurance may help bridge gaps in income so you can meet your financial obligations.  
  • Commercial Auto Insurance: You may need commercial auto insurance for company-owned vehicles like food trucks or catering vans that employees drive. If your employees use their personal vehicles to deliver food, you may require hired and non-owned auto insurance to protect against accidents caused by the employee in the course of his delivery duties.
  • Additional Coverage: Your restaurant likely has furniture, furnishings, and artwork, and you will want contents coverage to help pay the cost of replacing these items in the event of damage or destruction. If you lease the building in which your eatery operates, you may also need betterment coverage. This coverage provides protection against loss or damage to fixtures or improvements you have made to the space.

A restaurateur who owns her building will have different insurance needs than one who leases space in a food court. Similarly, a steakhouse that offers a selection of expensive wines may require different coverage than a deli that serves paper-wrapped sandwiches. Contact the local experts at Vargas & Vargas Insurance to ask about a customized insurance package that is suited to your specific needs.

Read More

Should I Buy Earthquake Coverage?

At Vargas & Vargas Insurance, our job is to provide the right insurance policies to protect your investment into your home and to protect your family and belongings. Today, we’re talking about earthquake insurance. Before we get any farther, we should point out that most dwelling policies don’t include earthquake coverage. In other words, if a huge 8.1-magnitude earthquake were to rumble through Massachusetts and toppled your home to rubble, you would not be covered with a standard homeowner’s policy.

mother and daughter inside a kitchen

Earthquake coverage is a rider that can be added to any home insurance policy. It’s worth the money if you ever experience a significant loss, and it’s certainly worth the peace of mind.

Does Massachusetts Experience Earthquakes?

Yes! According to the Northeast States Emergency Consortium (NESEC), the state has felt 408 earthquakes over the last 450 years. That’s almost one per year on average. Earthquakes occurring in surrounding states, and even as far as Quebec, Canada, have been felt in Massachusetts, too. 

Even though our earthquake history in recent years isn’t as scary as in other states like California, Massachusetts homeowners are always at risk of earthquake loss. Preparing for one now can protect your home later.

On Home Valuations and Earthquake Deductibles

Earthquake insurance is written based on the replacement cost of your home, not the purchase price or property tax valuation. In other words, your company will insure your home based on what it will cost to build a new home from the ground up, just like through your general homeowner’s policy.

However, deductibles work differently with earthquake insurance. You can choose your deductible to be 5%, 10%, 15%, 20%, or 25%. It’s vital that you understand these deductibles as they relate to a loss.

For example, let’s say your home replacement cost is $250,000. A 10% deductible is $25,000. Earthquake insurance won’t come into play for a small loss. If a small earthquake occurs and breaks all your dishes and some windows, the damage won’t be more than your deductible of $25,000. However, if your entire home were to turn to a pile of rubble, you’d be entitled to a check for $225,000.

Ultimately, the choice to insure your home against earthquake damage is entirely up to you. It’s an affordable addition to any homeowner policy, but it’s important to choose the right coverage for your specific property. Reach out to a licensed insurance agent at Vargas & Vargas Insurance today to learn more.

Read More

Coronavirus (Covid-19) Update

The safety of our clients and team has always been our first priority. The #coronavirus (COVID-19) has likely had an impact on our personal and business lives, and we continue to monitor this evolving situation closely.

Vargas & Vargas Insurance is prepared to have our staff work from home and will follow all instructions set forth by federal and state authorities. 

We will be able to provide the same service and customer care as we have in the past. However, the situation is very fluid and we trust you will understand if it takes a little longer than usual to respond to you. There are various ways to reach our team:

Via a call 617-298-0655
Via a text 617-409-0329
Via our service center, click here
Via our website, www.vargasinsurance.com
Via an email to customerservice@vargasinsurance.com
Or, Click here to access our online customer service center to view your insurance policies, print insurance ID cards, update your contact information, download documents, and so much more.

If you have traveled to ​China, Iran, South Korea, Italy, Japan, Hong Kong​ or have been in contact with someone who is ill because the incubation period for this virus is two weeks. Please refer to the CDC website or mass.gov as resources for any updates and refrain from any interactions with the public.

The best way to help yourself and others from spreading the virus is to practice good prevention methods.

1. Wash your hands frequently with soap and hot water for at least 20 seconds.
2. Use hand sanitizer when unable to wash your hands.
3. Sneeze and cough into your elbow, not your hands!
4. Avoid touching your face (eyes, nose, and mouth) with unwashed hands.
5. Stay home if you are feeling sick and avoid close contact with others who may be sick.
6. Clean and disinfect frequently touched objects (including cell phones).

If you are experiencing the above symptoms, please seek medical attention right away and call the healthcare facility ahead to let them know you are coming!

It is more important than ever to strengthen our social bonds. Seniors face particular health risk from this virus, yet taking precautions only reinforces social isolation. Please take the time to call, text, or send a message to your neighbors. Ask if any elderly friends or neighbors need help with grocery shopping. Remind them to stock up on prescriptions and to make provisions for child care in case they may need to seek treatment. Consider setting up a phone tree or email list for your block so that people can be in touch about what they need.

Stay healthy, wash those hands and let’s remember our neighbors!

Read More

Servicing States

  • Massachusetts

Testimonials


More Testimonials

Partner Carriers

  • Arbella Insurance
  • Commerce
  • Mass Property
  • New London County Mutual
  • Norfolk and Dedham
  • Pilgrim
  • Plymouth Rock
  • Safety
  • Travelers
  • Vermont Mutual