Bensman Risk Management, Inc.


Insurable Interests

Bensman Risk Management, Inc.
2333 Waukegan Road Suite 275
Bannockburn, IL 60015
847-572-0800 Phone
847-572-0502 Fax

Insurable Interests may offer general financial, insurance, tax and business ideas. However, due to the ever-changing tax laws as well as the complexity of the financial industry, you should seek professional advice before implementing any of the ideas contained in this newsletter. The Bensman Group, Bensman Associates Ltd., Bensman Risk Management, Inc. or Schemata, L.L.C. assumes no liability whatsoever in connection with the use of this newsletter.

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Securities offered through Kestra Investment Services, LLC (Kestra IS), Member FINRA/SIPC. Investment Advisory Services offered through Kestra Advisory Services, LLC (Kestra AS). Kestra IS and Kestra AS are not affiliated with The Bensman Group, Bensman Associates Ltd., Bensman Risk Management, Inc. or Schemata, L.L.C.

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Insurable Interests

Vol. 4, Issue 10June 2009

MONTHLY MESSAGE

Watch Out for Insurance Scam

There have been some people recently going through my neighborhood encouraging homeowners to have new roofs and siding installed – and suggesting that they can get their insurance company to pay for it. The idea is that the homeowner will claim that the roof or the siding was damaged in a major hailstorm that struck our area last summer. (Many insurers give policyholders a year to file a claim, which explains the timing of this campaign.)

I don’t know whether you actually could get your insurer to re-side your house by filing a false claim. But I do know that to file such a claim if you did not really have hail damage is insurance fraud. And insurance fraud is illegal as well as unethical.

It also ends up costing you money in the long run. Insurers base their rates on the amount they have to pay out in claims. When they pay more in claims, they raise their rates to cover the additional payout. We have had a rash of natural disasters in our area, ranging from the hailstorms last summer to extremely heavy rains and flooding this fall. As a result, many insurers already are raising their rates – sometimes significantly. For example, Allstate Insurance recently asked the state for a 28 percent rate increase.

Fraudulent claims only increase even further the amount that insurers have to pay out – and therefore the amount they might have to raise rates. It can be tempting to try to justify a false claim because of all the premiums you have paid over the years. But those premiums have given you protection and peace of mind. And if and when you ever have a real claim, your insurer will be there to help make you whole again.

So don’t listen to people who tell you that your insurer can or should pay from something that is not really a loss. In the end, you will end up paying more for the coverage you really need.

And of course, if you ever have questions about coverage, don’t hesitate to ask. You can reach us at 847-572-0800 or email me at dmiller@bensman.com.

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