If you Rent, get Renters insurance

“I installed a skylight in my apartment... The people who live above me are furious!”
- Stephen Wright

A co-worker recently experienced a fire in the apartment he rents. He did not have renter's insurance and must pay out of his own pocket the expense of a hotel room while looking for a new place to live and out-of-pocket to replace his belongings.

You might be thinking you could afford that if your belongings are few and/or modest. But there is another important component of Renters Insurance that no renter should be without - Liability protection. If a fire starts in your apartment and it looks like your fault (smoking in bed, a candle, a stove fire, etc) the landlord can sue you for damages and the cost to repair the entire building AND other residents can sue you for the damage they incurred from smoke, fire, and water.

Here are two examples I found on the Internet.

1. Insurance company for the apartment complex just had a law firm send a letter addressed to my sister-in-law and niece. It stated they were deemed at fault for the fire by the insurance company's fire investigator. [The bill is ] $180,000.

2. I am aware that i have to pay for the damages of the fire in my apartment that i caused accidentally. Now i get a bill & they're making me responsible for the buildings under me since i am on the 3rd floor. I don't have rentals insurance, so am i responsible for paying their damages as well? ...
[Answer] You are liable for all of the structural damage you caused ... You caused the damage, this is your puppy.

Bottom Line


There is just no excuse for not having renter's insurance, it can cost as little as $10/month!

Apartment fires are very common; most of the events I respond to as a Red Cross volunteer are apartment fires.

See also What to Do after an Apartment Fire http://www.apartmentinsurancerates.com/after-an-apartment-fire.html

Rent or Buy?

Our house, is a very, very, very fine house.
With two cats in the yard ...
- CROSBY, STILLS and NASH

Today I encourage you to read the article, The Renting Alternative Will Undermine The Housing Market For Years, from BusinessInsider.com. Ignore the misleading title. What the article is really about and covers well is the increasing tendency of successful individuals and couples to choose renting an apartment over buying a house. As one person put it,

"With a pool I don't pay for, a gym that's open 24 hours a day, and emergency plumbers on staff at 2 a.m., I have enough responsibility in my life that I don't need a home."

A commenter from Chicago says,

"I think we might be renters forever. My husband and I love sitting ... in the park reading the Sunday New York Times while our landlord is stuck fixing the garbage disposal. Time is priceless. And we are nowhere nearly as freaked out about finances as our friends are."

Bottom Line

I knew a man who worked as a school teacher by and a troubled youth counselor overnight in order to raise the money for a home for his family (this was back in the days you needed a real deposit on a new home.)
At the time he lived in a beautiful apartment complex with a tennis court, rec center, swimming pool, green fields, etc. but he felt it essential that his kids had their own lawn to play on.

Personally I'd be very happy to give up lawn care, etc. (I'm grateful my wife mows the lawn.)

Roughing It

“If you're not in New York, you're camping out.”- Thomas E. Dewey

Today I recommend an article by a former Scout, who is now the father of a Scout, and offers many suggestions for hiking gear. He also has a long section on sleeping in your car without getting caught. Perspectives on Roughing It and Covert Car Camping, by Jolly

Hiking:
* Buy a backpack one size smaller than what you think you need. You can pack more in than you imagine and most people pack too much.
* His #1 recommended hiking gear: a hooded rain poncho. This is followed by good hiking boots (be sure to break them in first) and a waterproof, warm hat.
* Jolly recommends Craigslist for camp gear bargains and has some suggestions for getting a great deal
* Buy a metal mess kit so you can eat and cook with it, saving pack weight

Car Sleeping:
I’ve slept in the car during a few cross county trips. I also once took a nap in the car after midnight when I was just too tired to reach the motel I had reservations with.

Many Wal-Marts allow RV’s to park overnight but not cars. Also it is illegal to spend the night at most rest stops along the interstate.

Jolly recommends parking at an apartment complex and blending in with the other cars. Be sure to park in a visitor’s spot and not a resident’s spot.

Bottom Line

Hotels are expensive. Consider camping outdoors or in your car to save money.

My wife and I have enjoyed several trips while sleeping in a tent. For us the most important thing was a comfortable bed for a good night’s sleep (followed by showers and flush toilets). While air mattresses are nice, I recall from childhood the enormous time my family spent inflating and deflating them. We found a quicker solution – a “bed” with a foundation of egg foam, real sheets, and a quilt for warmth. We would roll up the entire bed, sheets and all, and place it on the back seat of the car. To camp we move the bundle to the tent and just unroll it again. Worked great!

Water damage

“Seventy-five percent of our planet is water - can you swim?” - unknown

If your house is damaged by water, how you respond and cleanup is determined by whether the water is clean or contaminated. Clean water accidents include rain through a hole in the roof, a water tank leaking, a burst pipe, a burst swimming pool or water bed, etc. Contaminated water is typically floodwater. You have no idea what the floodwater may have mixed with before entering your house – sewage, dead animals, toxic chemicals, and so forth.

For dirty water damage the CDC recommends:

• Keep children and pets out of the affected area until it is cleaned
• Wear rubber boots, rubber gloves and goggles while cleaning
• Clean all hard surfaces (such as flooring, concrete, molding, wood and metal furniture,
  countertops, appliances, sinks, and other plumbing fixtures) with hot water and laundry or dish detergent. Some sites recommend using bleach.
• Discard anything absorbent that got wet and cannot be disinfected (mattresses, carpeting, carpet padding, rugs, upholstered furniture, cosmetics, stuffed animals, baby toys, pillows, foam rubber items, books, wall coverings, drywall, insulation, and paper products).
• Affected clothing can be saved by washing in hot water and detergent.
• Do not eat, drink or smoke while cleaning. Don’t let the germs into your mouth.
• After cleanup, wash your hands thoroughly with soap and CLEAN water.

For clean water damage, here are some housecleaning tips from “Servpro”, a professional Fire & Water – Cleanup and Restoration company.

• Remove excess water by mopping and blotting
• Wipe water from wood
• Remove cushions and pillows for drying
• Place foil or wood between furniture and wet carpet to prevent water seeping up the furniture legs
• Remove oriental and throw rugs to dry. Don’t try to remove a wall-to-wall carpet.
• Move artwork and painting to a dry location
• Don’t leave wet fabric in place. Dry them as soon as possible.
• Don’t leave books, newspapers, or magazines on wet floors. The ink may run and stain the floor.
• Don’t use a regular vacuum to remove water. You need a special wet-vac.
• Have wet appliances checked for safety. Don’t turn one on while standing on a wet carpet! Shock!
• Don’t work in a room if the ceiling is sagging from water. It may fall at any time.

Bottom Line

Save what you can but be prepared to toss a lot of stuff. In college I had to toss most of my vinyl record collect when my basement apartment was flooded by an inch of water. I might have saved the records if I had acted quickly but by the time I got to them, there was mold all over the jackets and on the albums.

Stay or Go?

Should I stay or should I go now?
If I go there will be trouble
An’ if I stay it will be double
So come on and let me know!
- lyrics by The Clash

Whenever I have the opportunity to watch BBC news, I’m always impressed by the extensive coverage of world news. American news networks rarely talk about world events unless there is a presidential visit or bad news in a US overseas war. That may explain how I failed to learn about the huge impact of an earthquake in China one year ago.

According to CNN.com, on May 12, 2008, at 2:28 p.m., Sichuan province was hit by an 8.0 magnitude earthquake. The quake could be felt over 1000 miles from the epicenter. It killed at least 68,712 people, with 17,921 missing, and more than 374,000 injured. More than 15 million people where displaced from their homes. CNN notes that, “One year after the quake struck, China is still counting the toll. “

One scandal following the quake is the Chinese government’s attempt to block any investigation of shoddy construction of school buildings. It took an entire year for the government to be shamed into releasing the student death toll. Only a few days ago did the government acknowledge that , “Thousands of schools collapsed in the earthquake, trapping students under the debris. Among the victims, 5,335 students died or are missing.” – CNN. Protesting parents and investigative reporters have been harassed and accused of prying into "state secrets."

Chinese officials claim that post-quake reconstruction is progressing well and point to 1 million new houses built in rural areas and 33,000 new apartments in cities with hundreds of thousands of more housing units are under construction. The government says it has helped nearly 1.3 million quake victims find new jobs. But if 15 million people were displaced and if each family has exactly one child (Chinese law), then only 1 in 5 of the affected families have new housing. Were 4 million families able to move and buy homes elsewhere? Or are they living in “prefabricated housing camps.”

Bottom Line

The effects of massive disasters like the Sichuan earthquake or Hurricane Katrina persist long after the media and rescue workers have gone. Homes, businesses, schools, and infrastructure must be rebuilt before lives can return to a level of normalcy. This can take years.

Don’t wait for government to “make things right.” Sometimes the best option is to move away and start a new life in a region not impacted by disaster. Of course millions of others may have the same idea but still the competition for jobs and homes should be less the further away you get from the disaster zone. House insurance may help you afford buying a new home elsewhere – BUT check your policy now. Are earthquakes covered? Most policies exclude flood and require an additional flood rider. Insurers are notorious for finding ways to avoid paying you, especially during large scale devastation when the cost to them is quite high.

Disaster Myths

The first of April, some do say
Is set apart for All Fool's Day;
But why the people call it so
Nor I, nor they themselves, do know,
But on this day are people sent
On purpose for pure merriment.
- Anonymous

In honor of April Fool’s Day I’ve searched the Internet for Emergency Preparedness Myths.

MYTH: “Disasters are Random Killers”FACT: A disaster is more likely to kill the poor living in substandard housing and the uninformed. Think about earthquakes and cheap apartment buildings that collapse. – Pan American Health Organization

MYTH: “If something happens all I have to do is call 911.”
FACT: “Security, like charity, begins at home and the responsibility for your family’s safety rests on your shoulders.” – Paul Purcell, security analyst and preparedness consultant

MYTH: “All I need is a 72-hour kit with a flashlight, first aid kit, some food and water and a radio to hear further instruction.”FACT: A more practical goal is to be self-sufficient for a minimum of one week.

MYTH: I don’t need to prepare because when “big one” hits, I’m dead anyway
FACT: “Mass Destruction” does NOT mean “Total Destruction.” When the atom bomb was dropped on Hiroshima, Eizo Nomura survived in a basement just 100m from ground zero. Akiko Takakura survived 300m from the blast center inside a solidly built bank.

MYTH: I don’t need to prepare because nothing like that could ever happen here.FACT: Each part of the world has its own unique disaster potential. I wrote earlier about a preparedness specialist in the Chicago suburbs who know he was unlikely to ever experience earthquakes, hurricanes, tornadoes, etc. Imagine his surprise when ordered to evacuate his home by the police because an abandoned train car had caught fire and potentially deadly fumes were drifting through his neighborhood.

MYTH: “Food shortages are inevitable after every disaster”
FACT: Food is usually available but frequently not accessible. (Hence the need for family supplies until roads are clear.) The real shortage after most disasters is clean drinking water. - Jean Luc Poncelet, MD

MYTH: “I received money for another disaster or from another agency or I make too much money, so there’s no point in applying for aid”
FACT: Every disaster is considered separately. And while FEMA will not duplicate insurance benefits, you may be eligible for help with losses not covered or with damages in excess of your coverage ("under-insured"). Most federal and state disaster assistance programs are available to ALL who suffered damages regardless of your income. - FEMA

MYTH: “I gave my information to a local emergency manager (or the Red Cross) so FEMA already has my case details.”
FACT: To be eligible for federal and state disaster assistance, you must apply online at http://www.disasterassistance.gov/ or by calling 1-800-621-FEMA (3362) (TTY 1-800-462-7585).

MYTH: “When a foreign disaster occurs, send ASAP every available volunteer (especially doctors) and send supplies of everything as quickly as possible.”
FACT: “The myth that the affected local population is helplessly waiting for the Western world to save it is also false, especially in countries with a large – but unevenly distributed – medical population. In fact, only a handful of survivors owe their lives to foreign teams. Most survivors owe their lives to neighbors and local authorities.” - Dr. Claude de Ville de Goyet. Unplanned and unorganized humanitarian aid supplies can be useless and clog distribution sites from receiving supplies that are critical. It is best to ASK what is needed before leaping to conclusions.

MYTH: “Life will be back to normal in a few weeks”FACT: Long after the media cameras have moved onto the next big story, people will be rebuilding homes and local infrastructure. “The greatest need for assistance appears several weeks and months after the event. It takes several years to rebuild a badly damaged area.” - Pan American Health Organization

BOTTOM LINE
I recommend reading the articles behind the links above. There’s a lot to learn about what to do for your family and what NOT to do when helping others.

Bankruptcy

“The worst bankruptcy in the world is the person who has lost his enthusiasm”- H. W. Arnold

I recommend the Consumerist article, Bankruptcy Is A Last Resort.

Bankruptcy is not a get out of jail free card for your debts, it's a nuclear weapon. If you use it, expect to be considered credit unworthy for a decade [because] bankruptcy is recorded on your credit report for ten years. …

There are two types of personal bankruptcy - Chapter 7 and Chapter 13. Chapter 7 is total liquidation where all of your possessions are sold to help pay off the debt. Chapter 13 is known as the "wage earner's plan" and is used to help restructure the debts so that the debtor can work towards paying them off over the course of several years.

Bottom Line

For the ten years after bankruptcy it won’t be impossible to get a loan but it will be difficult. Rates will be higher on home and car loans because you are a “risk”.
And though it is illegal, you may find landlords rejecting your apartment application and companies that are reluctant to hire you.

Learning Survival Skills

I am the very model of a modern Major-General
I've information vegetable, animal, and mineral
I know the kings of England, and I quote the fights historical
From Marathon to Waterloo, in order categorical ...
- From the Pirates of Penzance by Gilbert and Sullivan

To continue a theme from yesterday, part of emergency planning is skills assessment. When the worst occurs, how will YOU be able to help? The following is quoted from Survival FAQ which was cited yesterday as a great resource for planning:

"The kinds of skills and materials you need can be very widespread. Depending on the threat you're planning for, you might want the ability to recreate civilization as we know it. This is almost certainly impossible for one person, or even one family ... to be competent at them all. This is why survival groups or small communities are almost always preferable ...

You'll find that certain things are needed for many different threats. First aid skills and materials are always useful, you may find that they show up for every category. ... You might decide that you need to be proficient in emergency first aid, food preservation (drying, smoking, canning, pickling) , animal husbandry, engine mechanic, construction (design and building), fire fighting, sailing, fishing, computer programming, ham radios, weaving cloth, sewing, tanning leathers, bee keeping, accounting, trading, cabinetmaking, farming, dentistry, childbirth, small military unit tactics, advanced emergency medical treatment, improvised explosives, hunting, trapping, welding, metal working, power production and generation, telephone systems, and almost anything else you can think of.

Where to get trained:
... your local community probably offers a wide variety of courses that will help you in your quest. Check with your local community college, high school adult program, community center, or other educational programs. Just don't expect to see a category called "Survivalist Training". Your local fire department probably offers training in CPR and first aid, and if you can join, they'll offer you more and better training. The local law enforcement agency may offer training as well as your county's civil defense / emergency preparedness office.

Where to get experience:
The best way to learn some skills is to do it. ... you can offer your services as a volunteer to any one of a number of organizations. For example, if you're not sure how to cook for large groups of people, volunteer at a food bank, meals-on-wheels, or church group, and learn! If you want to learn how to build houses (and fix them, and how to use tools), organizations like Habitat for Humanity are available, just looking for helpers. You'll learn some skills, but more importantly, meet people who can show you more tips and tricks. Organizations like the American Red Cross usually need disaster workers, first aid instructors, etc., and they'll train you.

It may not be practical to study your specific area of interest, but can learn something that's closely related. If you don't have a field to farm, how about a back yard you can start growing a few vegetables in? If you're an apartment dweller, and don't have a yard at all, you can grow some vegetables, or even just flowers, in window boxes. You probably can't provide all your food needs from a window box (unless it's a huge window), but you can start finding out what it's like, what works, and what doesn't.

Bottom Line

My wife and I follow the advice given above. We have been trained by the Red Cross and by our county disaster program (WEVR) for free as volunteer disaster workers. We've attended low cost classes at a local community college and with community outreach programs.

The knowledge is out there. Go get it.

Kitchen Fires

"The diner is everybody’s kitchen." - Richard Gutman

While I love eating at diners, with the currently financial crisis, I'll be eating more meals at home to save money. Yet as noted yesterday, cooking fires in the kitchen are the number one cause of home fires. So if I'm not careful I could save the cost of a meal out and lose my home in exchange.

A common mistake is to forget you have a pot on the stove. In college I fell asleep while cooking and woke up later to find the bottom of the pot had melted, the metal liquefied around the electric burner. Another time while living in a college apartment complex I woke up smelling smoke and called the fire department. We evacuated and the firemen searched the apartments before finding a pot on a stove downstairs which was burning.

Here are some recommendations from the National Wellness Institute for safe cooking:

• Keep combustible items, such as rags, potholders, curtains and bags, away from cooking surfaces.
  [I make it a habit NEVER to put anything that can burn on the stove top regardless of whether the burner is on or off.]
• Never leave food cooking unattended on the stove top or in the oven
• Never cook if you are drowsy or feel the effects of alcohol, medication, or other drugs.
• Roll up your sleeves and don’t cook while wear loose-fitting clothing. If your clothes catch on fire, stop, drop and roll until the fire is out.
• Clean cooking equipment often to remove grease that could catch on fire.
• Keep children and pets away from cooking areas. Create a three-foot “kid-free zone” around the stove.

Bottom Line

It is so very easy to get distracted while cooking. Perhaps the phone rings or there is someone at the door. Perhaps you're cooking and watching TV or a movie or on the Internet. If your food does catch on fire here is what you do:

1. Use your kitchen fire extinguisher (you have one right?)

2. Don't throw water on the fire. Water and grease don't mix so you'll just spread the fire.

3. Fires need air to burn so try to smother the fire: put a lid on the pot or cover it with some thing that won't burn.

4. If the fire is bigger than a basketball, get out of the house. Don't die trying to save your house.

5. Beware of fumes if you are fighting the fire. Most often it is smoke, not flame, that kills. The smoke can knock you unconscious and you'll die from asphyxiation (and then burn).

Renters Insurance

"Last night somebody broke into my apartment and replaced everything with exact duplicates... - Steven Wright (1955 - )

As a home owner I never considered NOT having home insurance. A house is too expensive to replace if lost to a fire. However as a college student I never once considered renters insurance.

The topic pops up now-a-days as one of the questions I must ask fire victims on the Red Cross forms. According to a pamphlet I picked up, renters insurance covers the cost of your belongings (not the apartment room) in case of fire, smoke, theft, storm damage, water/plumbing damage, etc. Your landlord's building insurance does NOT cover your personal stuff - for example my record collection that got warped and ruined when my basement apartment at college was flooded by heavy rain.

The pamphlet claims that rental insurance can be inexpensive, $12/month in many areas. But you'll need to check the policy to see what it covers and perhaps pay extra for some coverage like flood damage. Your car insurance company might give you a discount for buying another policy from them.

Also, keep in mind your need for liability insurance. Say your roommate's clumsy cousin trips on your sneakers, falls down the stairs and hurts his back. Like it or not, he could sue you for that. Whether or not he wins, fighting that suit could be an expensive nightmare.

Bottom Line
If you own an apartment you may be thinking - I don't have much, why insure it? But if you add up the cost of your big screen TV, your computer, your stereo system, clothes & shoes, cooking supplies and equipment, books, jewelry, CDs & DVDs, electronic toys, etc you may be surprised at how much it would cost to replace.

Here are the top links I googled for rental insurance:

Geico http://geico.com/getaquote/renters/

Liberty Mutual http://www.libertymutual.com/pmcampaign/landing_renters.html

State Farm http://www.statefarm.com/insurance/renters/renters.asp

Allstate http://www.allstate.com/renters-insurance.aspx

Red Cross Disaster Services - Part 1

A terrible, horrible, no good, very bad day. - from the children's book,
Alexander and the Terrible, Horrible, No Good, Very Bad Day

Last night my wife and I were called by the Red Cross to provide aid for a small apartment complex that had experienced an apartment fire. No one was home when the fire started and the cause remains unknown. In today's blog I'd like to share some of what happened.

Disaster recovery takes time. The fire is thought to have occurred at 3:30 pm. At 4:30 the fire department initially told the Red Cross that no help was needed (no one was home). This changed at 5:30 when residents started returning from work and the Red Cross was officially asked to assist. The shift coordinator was stuck in commuter traffic and was not able to build a response team until 7pm. My wife and I arrived on site at 7:30 and waited until about 8:00 for a translator to arrive and organize the several families that needed help. With the help of the translator my wife & I completed case files for five family units, filled out financial assistance forms, obtained authorization for and provided debit cards. This took 2 1/2 hours until 10:30pm. During all this we sat under a street light on a sidewalk trying to keep the paper work organized.

A part of the process that surprises many people is the request for an ID. Before handing out debit cards, the Red Cross representatives need to verify that you are actually a resident of the impacted building. This is to prevent fraud. A foreign passport is nice and proves that you are you but won't provide proof of residency in apartment X. Last night we were fortunate to have the landlady on hand to verify actual renters.

Tomorrow I'll give more details on the assistance provided.

Bottom Line
Disaster recovery requires time and patience and lots of paper work. Be prepared for lots of personal questions and lots of waiting.