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Asset Protection
Lifelock CEO bitten by identity theft
May 23rd
You’ve probably heard the ad below:
“My name is Todd Davis. My social security number is 457-55-5462.
I’m Todd Davis, CEO of LifeLock, and yes, that’s my real social security number*. Identity theft is one of the fastest growing crimes in America, victimizing over 10 million people a year and costing billions of dollars. So why publish my social security number? Because I’m absolutely confident LifeLock is protecting my good name and personal information, just like it will yours. And we guarantee our service up to $1 million dollars.”
Todd is the CEO of Lifelock. His ad was a bold challenge and a great marketing move in support of his services. Unfortunately, this challenge did not fall on deaf ears.
Yesterday, Jordan Robertson from the Associated Press wrote an article explaining how Davis’ ad has come back to bite him. This stunt has resulted in eighty-seven attempts to steal Davis’ identity; one man was even successful. Here come the lawsuits! Read on.
Tips to Protect Your Wealth
May 19th
This post is inspired by Mary Dalrymple’s article, “Wealth Defense: The Biggest Threat to Your Money”. Here’s a quick summary of the tips for you to consider:
- Your Bank – If you’re not getting the most out of your bank, look for better rates (other banks or alternative investments to boost your interest rate). This suggestion also applies to bank fees for checking accounts and minimum deposit amounts.
- Your Credit Cards – Are you paying an annual fee? If so, WHY? There are so many good no annual fee credit cards. Also, check your annual percentage rates. You can call your credit card company to ask for a better rate. In addition, find out if there are any promotional rate offers. Even better, go for a cash back, no annual fee credit card.
- Your Credit Report – Check your credit score and report carefully. Your score can affect the rate you’ll receive on your loans. In addition, you want to check regularly for possible signs of identity theft.
- Your Retirement Accounts – Are you taking advantage of an IRA and/or your company’s 401K plan? If not, look into this especially if your employer provides matching on your contributions. If you’re not getting the maximum match on your contributions, then you’re leaving money on the table.
- Your Brokerage Account(s) – If you’re investing through a stock brokerage, check your fees and commissions especially if you make frequent trades every year. If you invest in mutual funds, check the fees for your fund carefully because you may be leaking money in the back end. Finally, look into dividend re-investment options if your stock pays a dividend.
- Your Will – Do you have a will? Has it been updated? You don’t want your estate to go into probate.
These are just a few ideas. If you have other suggestions, feel free to comment.
It’s the Economy, Stupid
Apr 9th
I’ll be taking a break from writing a post for a week. Check back next week when I return from my short break.
In the meantime, here are some interesting articles from CNNMoney.com I want to pass along for your reading pleasure.
Fed sees economy getting worse
Gap between rich and poor widens
How to recession-proof your life
8 ways to recession-proof your job
Don’t let a recession wreck your retirement
Your stocks: Riding out a recession
Personal Liability Umbrella Policies – Part 2
Nov 4th
The following is part 2 of a newsletter I received from Eric Heckman, CFP, ChFC.
What’s Covered?
A typical personal liability umbrella policy provides the following protection, up to the coverage limits specified in the policy:
- Protection for claims of bodily injuries or property damage caused by you, members of your household, or hazards on your property, for which you are found legally liable
- Personal liability coverage for incidents that occur on or off your property
- Additional protection above your basic auto policy for auto-related liabilities
- Protection against non-business-related personal injury claims, such as slander, libel, wrongful eviction, and false arrest
- Legal defense costs for a covered loss, including lawyers’ fees and associated court costs
What’s Not Covered?
Personal liability umbrella insurance typically provides extremely broad coverage. Furthermore, if something is not expressly excluded from coverage, it is covered. The following exclusions are common:
- Intentional damage caused by you or a member of your family or household
- Damages arising out of business or professional pursuits
- Liability that you accept under the terms of a contract or agreement
- Liability related to the ownership, maintenance, and use of aircraft, non-traditional watercraft (e.g., jet skis, air boats), and most recreational vehicles
- Damage to property owned, used, or maintained by you (the insured)
- Damage covered under a workers’ compensation policy
- Liability arising as a result of war or insurrection
How Big of an Umbrella?
Determining how much liability coverage you need is not an exact science. You might think that you need only enough liability insurance to protect your assets, but a large judgment against you could easily wipe out your assets and put your future earnings in jeopardy.
Coverage limits vary, but a typical policy will provide liability coverage worth $1 – $10 million. Of course, as your coverage limit increases, the premium will also increase. Your licensed property and casualty insurance agent can help you determine how much coverage you need.
Where Can I Buy?
Almost any insurer who writes auto and home insurance policies will also offer liability umbrella policies. You many even be eligible for a multi-policy discount if you purchase a PLUP from your current property and casualty insurer.
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Personal Liability Umbrella Policies – Part 1
Nov 2nd
I received the following newsletter from Eric Heckman, CFP, ChFC.
When your local weather forecaster tells you that it’s going to rain, you reach for your umbrella. So why not purchase an umbrella that can protect you in stormy financial weather? Personal liability umbrella policies (PLUPs) can do just that. By providing liability protection above and beyond the basic coverage that homeowners/renters and auto insurance policies offer, a PLUP can protect you against the catastrophic losses that can occur if you are sued.
Although a PLUP can be purchased as a separate policy, your insurer requires that you have basic liability coverage (i.e., homeowners/renters insurance, auto insurance, or both) before you can purchase a liability umbrella policy. It is often referred to as excess coverage. If you are found to be legally responsible for injuring someone or damaging someone’s property, the umbrella policy will either pay for the part of the claim in excess of the limits of your basic liability policy or pay for certain losses that are not covered.
Why now? It’s not even raining
These days, it’s not unusual to hear of $2 million, $10 million, and even larger court judgments against individuals. If someone is injured in your home, or if you cause a serious auto accident, you could have to pay such a judgment. If you don’t have a PLUP at the time of the accident, anything above the limits of your homeowners/renters or auto insurance policy will have to come out of your pocket.
Here’s an example of how a PLUP works to protect you. Say you have an auto insurance policy with a liability limit of $100,000 per accident. You also have a $1 million umbrella liability policy. You’re later found responsible for a serious automobile accident, and the court finds you liable for $700K in damages. In this case, your auto insurance would pay the first $100K of the judgment, which would satisfy the deductible under your umbrella policy. Your umbrella policy would then cover the portion of the judgment not covered by your auto insurance ($600K).
Certain types of liability claims (e.g., libel and slander) are not covered under basic homeowners, auto, or other types of insurance policies. An endorsement can be added to these policies to provide some protection, or you can purchase a PLUP which does cover these claims.