Every year, there’s a survey of customer satisfaction with the insurance industry. This year, the satisfaction level with companies offering cover for damage to home and contents is at an all-time low. In part, this is caused by the recession. As families are under more financial pressure, they look to the insurers for more generosity in repairing or replacing property only to find reluctance to pay. But about half those surveyed did not actually know what type of coverage they had on their homes. The dissatisfaction is more often caused by misunderstandings about exactly what the policies cover. Nationally, this is leading to lower levels of retention as customers move from one insurer to another, always hoping to find better value.

One issue is proving particularly troublesome. When surveyed, people tend to have fire uppermost in their minds. Yet the statistics show the risk of fires is quite low. The risk of flooding is significantly higher. There are two reasons for this. The first is more storms have affected the US, in some cases, dumping vast amounts of rain in very short periods of time. Whether this is climate change is not the issue. It’s actually happening. The second is there has been a steady increase in the level of building in flood-hazard areas. Just living there is bad enough. Covering up land that would struggle to absorb the water without putting in proper drains just makes the problems worse. Because the risk of flooding is now higher, many insurers either exclude the risk altogether or offer only very limited coverage. You should check your policy to see whether “water damage” is included. This is defined as any situation in which water causes loss or damage to either the structure or contents. It can be frozen pipes during winter, or rain coming through a displaced roof tile, or water rising from the local sewers, or a local river bursting its banks.

It’s the fall and soon time for trick-and-treat kids to come knocking on the door. For everyone living in more northerly areas, it’s also time to make those final preparations for winter. Friends living in country areas will have been laying in wood and coal for heating. Now is the time for everyone to go through your checklist. Sometimes the weather can be severe. Now matter what you believe about climate change, it’s wise to assume the worst and winterize your home. That way, when spring comes around, you have avoided all the more likely hazards and your bank account is healthy – no deductibles and out-of-pocket expenses. So let’s start with the biggest threat that comes with the cold.

You turn on your heating systems which have stood there untouched since the last of the spring shivers passed into the warmth of summer. You don’t want a fire. That furnace lurking down in the basement. When was it last inspected? Have all the ducts been cleaned? Clean ducts? You do remember to keep the ducts clean by changing the filter on a regular basis. Of course you do. The energy source could be piped gas (which never leaks) or oil or propane stored in tanks outside (which never leak or catch fire). Or do you store the wood, coal or coke you burn in the basement? If it’s too close to the furnace itself, this can catch fire if sparks fly out when you open the furnace. The same goes for anything else flammable you may be storing down there. Then go through a bleed all the radiators. If you have fireplaces, check the screen on the chimney is still in place. You do not want birds or wild life falling down when the first fire is lit. If you use it regularly, it needs to be swept to remove excessive soot.

The Brits used to have a saying, “Your home is your castle”. The idea is simple. Once inside, you can protect it against all-comers. As long as you are using reasonable force, the law of self-defense covers both you as a person and your property. But no one can or should stay home all the time. You have to go out to buy food, if nothing else. So when you do venture outside, how much are you worth? This is time for honesty. If all you wear is hand-me-downs with old old pair of sneakers and a few dollars clutched in your hand, there’s no cause for alarm. But not everyone lives in such humble circumstances.

So start with all those digital things that keep you connected with the social world. How much did you pay for your cell phone or is it a Blackberry or something even more connected? Is that an iPod and do you have a Kindle or one of those reading devices? And is that one of those new slim laptops? All this before we get to asking about your watch and that leather wallet with all those credit and debit cards inside. And a final question for the fashion-conscious reading this – just how much did you pay for that designer label clothing and what is that bag you are holding? Ignoring the question of the credit and debits cards for now, how much would it cost to replace it all? In theory, the credit companies will have terms written into your agreements on how to handle any losses should your cards be stolen. Ah, but you are now shaking your heads. The chances of losing it all are slight. There’s no need to worry.

Life has been tough over the last two years as the recession has bitten into family budgets. It’s difficult to keep a job and even more difficult to find a new job, so decisions about transport become critical. How can you keep a job or look for new work if you don’t have your own vehicle? In some cities, life is not so bad with subways and other forms of mass rapid transit. But we hate the idea of jumping on a bus even if one does happen to be passing. We depend on our own vehicles to get us where we need to be. In the good old days when credit flowed like water, we would replace our vehicles every two years or so. It was a routine we never used to think about too much. There were monthly installments on the loans, but they stayed pretty constant even though we upgraded the vehicles. Life was good. So what do we do now the money is tight? We watch the vehicles age and worry about what to do if big bills comes along for repairs.

Which is better? Repair or replace? Well, let’s clear the obvious out of the way first, dealing with comprehensive and collision. As the replacement value of the vehicle falls, it’s cheaper to insure. Remember the policy only pays the fair market value of your vehicle. If the cost of repairs will be more, the insurer will total the vehicle, i.e. just pay you the fair market value. In theory, this is enough cash for you to go out and buy a replacement of similar age and condition. You can get an idea of your vehicle’s value by using a site like http://www.nadaguides.com/ or http://www.edmunds.com/. This gives you guide prices on the secondhand market. More importantly, these sites also tell you how much you can expect to pay to replace your vehicle, whether new or secondhand. You can also check out local dealers. Looking around the market now, most new vehicles are at least $20,000 – many a lot more. If you are thinking of replacing and you will need a loan, there are many sites giving you interest calculators so you can work out roughly how much the monthly installments are going to be. Now we come to the final two factors.

A lot of people living without children, married or not, have the reckless minds of youth. They think that if they die, it doesn’t matter to anyone. It won’t put a burden on anyone. Or, if they are worried about their spouse, they think that there is enough money to take care of him or her, or that he or she has a job, or the house is paid off and they don’t need the income.

There’s a problem with this thinking.

It’s wrong.

The fact is, we insure our lives for more reasons than simple financial security for children or relatives. However, even if you think you don’t have to worry about financial security for them because you are wealthy, think again!

Starting in 2011, the Estate Tax is going to be a significant obstacle to passing on wealth in the event of the property-holder’s death. With an estate worth $1 million, 40% of the value passing on to a spouse or relative will be taxed! So, from $1 million your spouse only get $600k. Now is that enough to maintain all the other properties, payments, and the standard of living that he or she is used to without your income? If it’s not, you may have to rethink getting a policy.