Vargas & Vargas Insurance

1133 Washington St
Dorchester, MA 02124

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How to Know if Umbrella Insurance is Right for You

While nearly every person is familiar with common insurances like auto and homeowners, one that often flies under the radar is umbrella insurance. Essentially, for each of your insurance policies you have a limit to how much money the insurance company will pay – minus your deductible – for a claim. In some circumstances, the total balance due may be greater than what the insurance company is paying which means you are on the hook to pay the difference. In a situation like this, if you have umbrella insurance then the policy will kick in to cover the difference once your coverage has been maxed.

Whether or not you need umbrella insurance is a common question. Generally speaking, you should consider purchasing a policy if the value of your assets to include items like your real estate property, bank accounts, retirement accounts, investment accounts, college savings plans and any other asset with a monetary figure attached to it exceeds the limits of your homeowner’s or auto insurance liability coverages. Ultimately, the goal is to have more liability insurance than your assets are worth so you can’t risk losing them in a lawsuit.

With that said, you don’t need to have a high net worth to make umbrella insurance worthwhile. If you have a situation where you have greater liability than others such as household staff, dangerous equipment on property or an aggressive animal than it won’t hurt to at least explore your options. 

When it comes to shopping for umbrella insurance in Dorchester, MA, there’s really no better option than Vargas & Vargas Insurance. Focusing on a no pressure environment, our friendly and knowledgeable team of insurance professionals will answer all your questions, help determine if an umbrella policy is right for you and assist you in the underwriting process. 

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What You Need to Know About Business Interruption Coverage and COVID-19

a carpentry business owner considering his insurance options during COVID-19 restrictions

Most businesses throughout the country have experienced some type of financial loss as a result of the COVID-19 pandemic. If you have chosen or been forced to temporarily close your business, you are likely searching for ways to replace your lost income in order to avoid a permanent closure, particularly if you have not been allowed to reopen yet. Although business interruption coverage applies to many events that have a similar impact on the operations of your business, it is unlikely to be a solution to interrupted business and revenue.

What Is Business Interruption Coverage? 

Business interruption insurance is a type of specialized coverage that can be added to your regular commercial insurance policy. It is intended to serve as an additional layer of assistance for businesses that must temporarily stop operating as the result of a specific event, such as a fire or natural disaster.

Business interruption insurance generally serves as a temporary replacement for income, which can be used to keep the business from being forced to permanently close after such an event. The coverage is typically used to allow the business to continue paying employees and bills until it can reopen. 

Can Business Interruption Coverage Be Applied to COVID-19 Closures?

Unfortunately, most business interruption coverage policies cannot replace the income that is lost as a result of closures related to COVID-19. Many business interruption coverage policies include a clause that specifically excludes pandemics, as the policy is intended for closures that include physical damage to the business. Although business interruption insurance policies exist to cover sporadic closures, they generally do not have the funds to replace the massive amount of income lost by nearly every business in the country during the pandemic.

However, not every insurance company excludes pandemics. We highly recommend reaching out to your insurance provider for more information about specific policies regarding COVID-19. Talking directly with your agent is the best way to get your questions answered accurately. 

At Vargas & Vargas Insurance, we prioritize providing the most accurate and up-to-date information regarding the various types of insurance coverage available and how they can apply to unprecedented circumstances. Contact us today to learn more about the insurance policies we offer or to request a quote.  

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3 Recommended Commercial Insurance Changes for Companies Switching to Remote Work

An increasing number of businesses are considering a permanent shift to remote work for their employees. The change is taking place in different industries, especially the technology industry. When a business switches to remote work, its potential risks and liabilities change. If your small business is considering changing to a remote workforce as a long-term strategy, start with a review of your business’s commercial insurance policies. This will help you identify potential gaps and changes in coverage that need to be addressed.

woman on a video conference while working from home

Some of the insurance implications that may arise under conventional insurance policies include:

1. Employers’ Liability and General Insurance

Coverage for your employees’ potential injuries depends on the categorization, where the injury took place, and the activity undertaken at the time of injury. Your business needs to ensure that the definition of covered employees under the employers’ liability insurance includes all employees to which the company may be found liable. Also, you need to ensure that the coverage consists of all places where your workers are located.

2. Property Insurance

The COVID-19 pandemic has led to an increased focus on different aspects of property insurance. While transitioning to a remote workforce may create less loss as a result of property damage, you may have more devices and equipment spread across different locations. Therefore, you need to make sure that property being used by workers in remote locations is insured.

3. Cyber Insurance

The switch to work remotely can make your business more susceptible to schemes of social engineering and hacks. When your employees work from home, they adapt to different modes of communication and may create new vulnerabilities in your system. But you need to do more than allow your IT personnel to increase security in remote working environments. Consider adding more coverage, such as cyber insurance, to protect your business’s data, systems, and hardware. Your business needs to make sure the coverage matches the risks.

For more assistance choosing the right commercial insurance policies during changes to your business, contact Vargas & Vargas Insurance today. We’re here to help.

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What Should You Do If Your Term Life Insurance Policy Is About to End?

Do you have a term life insurance policy?  A term life insurance policy is for a specific period of time.  It will only provide coverage for a set period of time, such as 10, 15, or 25 years.  During this time, if your policy is active, and you die, the policy will pay out benefits.  But if you have a 10-year term life insurance and you die in the 11th year, unfortunately, the policy will not pay your beneficiaries. 

older couple discussing what to do about their term life insurance policy

If you have term life insurance and it is coming to the end of the policy, you can do a number of things.  These include:

  1. Convert the policy.
  2. Renew the policy.
  3. Buy a new policy.
  4. Let the policy end.

1. Convert Your Term Life Insurance

If you have a term life insurance policy, you may have the option to convert the policy to universal or whole insurance.  Depending upon the term life insurance that you have, you may have the entire policy period to convert or just a specific time period. 

For example, if you have a 10-year policy, you may have ten years to convert to another type of life insurance policy.   On the other hand, your policy may only allow you to convert in the first five years of the policy.  Check the terms of your policy or reach out to your insurance company.

The key advantage of converting to a whole or universal life insurance policy is that you often do not have to go through another health check for your policy.  The policy will convert and not use your current health condition for underwriting the policy.  This is a great feature if you have developed health conditions since you bought the original policy.

What Is Whole or Universal Life Insurance?

Before we continue, it’s important to know what whole and universal life insurance are.  Whole life insurance has consistent premiums and a guaranteed cased value accumulation.  Universal policies have flexible premiums and death benefits.  You can borrow against the cash value of either policy, and these are considered permanent life insurance.  The coverage doesn’t end when you stop making premium payments — it will extend further into the future.

2. Renew the Policy

Some term policies allow for renewing the policy.   This is known as a renewal option or privilege.  It allows the policy owner the right to renew their term life insurance policy for an additional time period.  However, if you renew the policy by extending your current policy’s coverage, the amount you pay may increase.  You can renew even if your health has changed, but you may only be able to renew the policy until a certain age.

3. Buy a New Policy

If your health hasn’t changed, you can also buy a new policy.  At this point, you can buy a term, whole, or universal life insurance policy.  You will have to go through the health check again, and you may be limited by a two-year suicide clause.

4. Let the Policy End

A fourth option is to just let the policy end.  Though this leaves you with no life insurance, it is an option.

If your term life insurance policy is ending or you would like to make changes to it, contact us or give us a call!  The team at Vargas & Vargas Insurance can help you figure out what is best for you and your situation.

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What to Do During and After a Hurricane

woman looking through the window at home as a hurricane approaches

Hurricanes can pose a serious hazard for people and properties in the Boston, Massachusetts, area. Floods, heavy winds, and other severe weather factors can cause damage quickly. Read this short guide about how to stay safe and protect your property both during and after the next hurricane.

What to Do During a Hurricane

During a hurricane, it is important to avoid going outdoors or driving because the winds and flooding can be dangerous. If you must be out in the storm, then it is important to:

  • NOT drive around road barriers
  • NOT walk through flowing water
  • NOT drive through flooded roads

Also, continue monitoring the media for any emergency information. Look for credible emergency information shared by the Massachusetts Emergency Management Agency (MEMA) and other government agencies. Also, you need to follow instructions given by the public safety officials.  

If directed to evacuate, you need to do so immediately, and take only your essential items and any pets, if possible. Given that conditions change fast, you need to be ready for evacuation to different places as directed and if necessary.

What to Do After a Hurricane Has Passed

After a hurricane has passed and you had evacuated, return home if authorities say it is safe to do so. Continue to listen to news reports to know if the water supply is safe. Before local authorities declare your water supply safe, you need to boil the water before drinking or using it for food preparation.

As soon as it’s safely possible, check your home for any signs of damage. While checking your home, you need to:

  • Repair leaching systems and damaged septic tanks to minimize potential health risks.
  • Hire a qualified electrician to assess any damages to electrical systems.
  • Have a professional check your wells for contamination.
  • If you suspect there is a gas leak, go outdoors immediately and contact a licensed professional to check it out.
  • In case your home or property is damaged, document the damage by taking videos and photos and contact your insurance company.

Also, report any power outages to your utility company. If you’re waiting for the power to return, be careful to only use grills and generators outside because their fumes contain dangerous gases.

Try to avoid entering floodwaters in and around your property. Seek the services of a professional cleaning and repair company to clean and disinfect your home. Check on neighbors and friends, especially the elderly and those who live alone.

At Vargas & Vargas Insurance, we’re here to help you protect your home, property, and family. Call us today to learn more about hurricane-related coverage, flood insurance, and safety tips to help you get through the storm.

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3 Things to Consider When Choosing Between Whole and Universal Life Insurance

family with a second expected child in their kitchen

Whole life and universal life insurance policies have similarities and important distinctions. Both are types of permanent life insurance, which means they provide coverage for your entire life as long as premium obligations are met (which is different from term insurance). Also, you can build cash value in either type of policy. Here’s what you need to consider to choose the coverage that’s the right fit for you.

1. Your Budget

Would fixed premiums or adjustable ones be a better match for your budget needs? Whole life insurance has fixed premiums. After you pay the initial premium on a universal life policy, you decide how often and how much to pay your premiums as long as you meet the policy’s minimums.

2. Your Risk Tolerance

Your investment in a whole life policy has low risk. The cash value accrues interest at the rate set by your insurer. Some whole life policies are eligible for dividends. You can choose to reinvest your dividends in the cash value or to have them sent to you. Dividends may also be put toward premium payments.

Selecting universal life, on the other hand, requires a higher risk tolerance. The rate of return on the policy’s cash value is not guaranteed. Rather, returns go up or down with market conditions. Some universal life policies are linked to the performance of a specific index like the Nasdaq 100.

3. The Needs of Your Loved Ones 

Since whole life provides a fixed death benefit, it’s easier to plan for the future of loved ones who depend on your support. Fixed benefits may be particularly helpful if your loved ones include an aging relative, a child with special needs, or anyone else who won’t be able to develop their own means of support. 

Universal life allows you to pick between a fixed death benefit and a benefit you can adjust up or down. This feature is beneficial if your personal circumstances change. For example, a married yet childless adult may initially choose a smaller benefit since it’s likely that only one person — the spouse — depends on the insured’s income. Should this couple have a baby, the insured person may want to increase the death benefit because more people rely on the insured person for support. 

Your local independent insurance agent can answer questions and help you choose the right type of policy for you and your loved ones. Contact Vargas & Vargas Insurance today for friendly, helpful service.

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