Cruise control: From insurance to packing tips

If you're taking a cruise, here are some ways to ensure smooth sailing.

Insurance: Trip cancellation and travel insurance is a small price to pay if you must cancel a cruise because of a crisis, especially now when losing a job looms large for many. Also with medical evacuation costs often running into the tens of thousands of dollars, travel insurance could be a smart investment if, for nothing else, peace of mind.

Packing: Never pack anything in your luggage you couldn't stand losing forever, and, to save space, don't pack anything you don't intend to wear at least twice or that isn't readily washable. Most ships (especially mega-vessels) provide self-service laundry facilities onboard, so don't be afraid to pack on the light side.

Tape your name, address, phone and cell numbers inside your luggage. Outside labels are as abused as the suitcases themselves and might not survive the journey. Inside, they will.

Stuff an extra collapsible duffel bag or two into your suitcase. At the end of your vacation, you'll be glad to have additional luggage to store your dirty laundry or those never-thought-you'd-buy mementos.

Before your trip, take a snapshot of your luggage inside and out. This will make it easier for airline or cruise personnel to identify your belongings if they are lost. The photos also might prove useful for insurance purposes.

Documents: Always carry your cruise and airline documents on your person and not in your luggage or carry-on bag, which might easily be misplaced or lost in the confusion and hurry of travel.

Food to go: In these tight times, penny-pinching makes sense. For instance, before heading off to the beach or excursion, consider packing a lunch. Either ask your ship's waiter or room service to prepare something for you, or head to the buffet and pile on your own favorites for the day's outing. Not only will this save you money and time in scouting for a place to eat, but, in a foreign country, also dealing with currency exchanges.

Sodas: Are you or the kids hooked on sodas? Instead of running up a large tab for pop, consider purchasing the cruise line's all-you-can-drink sales. Prices vary, but anticipate anything from around $35 and up for a week's worth of never-ending fizzy beverages.

The right cabin: Hate noise and prefer a calm cabin? Avoid staterooms next to triple and quad cabins, especially during summer and holiday sailings, when you're more likely to find your neighbors are not singles or couples but families with kids.

Also keep away from rooms near elevators and utility rooms (such as the laundry) or those above or below the show lounge, casino or pool deck.

Not all private balconies are private. Check out the printed deck plan in the line's brochure to see if your neighbor above has a bird's-eye view of you and your veranda.

Staying healthy: Norwalk virus has ruined many a passenger's cruise, and the best way to avoid a few days confined to your cabin is to soap your hands meticulously. Just as important, when you dine at the buffet, either wear gloves or use a napkin to ladle your food into your plate. Don't be embarrassed. Your neighbor on line might smirk inside, but you'll have the last laugh if others wind up catching the highly contagious virus.

Shopping bargains: One shrewd shopper we know never buys any mementos from the ship's gift shop until the last day of the cruise, when many T-shirts and novelty items are mostly half off.

You might find cheaper excursion bargains ashore than onboard. Lots of savvy cruisers simply step off the gangway and sign up for excursions with the myriad tour operators that typically line the pier.

Sightseeing: If you want to sightsee during a Caribbean cruise, consider renting a car or hiring a taxi for a guided tour of the island. You'll probably save a bunch over the ship's shore excursions and have a lot more say on how long you want to stay at the beach or linger over lunch.

If you are the go-it-alone type, you might find a cruise guidebook, a book on ports of call and, of course, the Internet invaluable in planning your own adventures.

Onboard art auctions: You might want to think twice before you shell out hard-earned money for a print or other painting or lithograph at the ship's onboard auction. You can attend the auctions just for the entertainment. No purchases are necessary.

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Beware of roofing scam and claims of hail damage

By Bill Garwood

For the Journal-Constitution

Sunday, April 26, 2009

Most of us are familiar with the old proverb: “If it seems too good to be true, it probably is.” This proverb appears to be playing out in metro Atlanta and now in North Georgia.

Less than scrupulous roofing companies —- some local, some from out of state —- are currently going door to door offering free assessments of roofs for potential hail damage. Not surprisingly they are finding it. In many cases, these companies will even facilitate the homeowner’s claim with his or her insurance company.

The attraction to this scheme is natural. New roofs cost thousands of dollars. Who wouldn’t want their insurance to cover this cost? Unfortunately, the truth is that hail damage is much less common and destructive than these roofing companies would like you to believe.

Some facts

To understand why hail damage is not so destructive it’s helpful to know a little about how common asphalt composition shingles are made. Trying to keep it simple, the base mat of asphalt composition shingles is made of either paper or glass fiber. The base mats are coated with an asphalt mixture including some mineral stabilizers.

On top of this, granules are applied. The granules are usually crushed stone coated with a ceramic material. It is the granules that give the shingles their color. The granules also help protect the shingles from the effects of the sun.

It is the loss of the granules and the subsequent exposure of the asphaltic mat that can result in real damage to the shingles. Because shingles begin losing granules the day they are manufactured, shingle manufacturers typically install excess granules. In most cases hail does not remove enough granules to compromise the shingles.

The scam

If your car tires fail and you make a claim against the tire manufacturer’s warranty, the manufacturer will prorate the value of the existing tires based upon their age. The same is true of a warranty from a shingle manufacturer.

The warranty will pay out less on a 15-year-old shingle than on a 5-year-old shingle. This is not true, however, for the insurance coverage on a hail-damaged roof.

The insurance company will pay the same amount for replacement of a 15-year-old roof as they would for replacement of a 5-year-old roof. This makes insurance claims for hail damage extremely tempting. The insurance companies will send out an adjuster to determine if the damage is real. In many cases the adjusters do not get on the roof and actually count on a roofer’s eyes to make their assessment.

The problem

You may ask: “If my insurance company says they will pay why should I care?” Insurance companies are not in the business of losing money. If enough of these claims are paid out, we will all eventually suffer in the form of higher insurance premiums.

In addition to this longer- term problem, there are numerous reports of the “hail chasers” doing substandard or incomplete work.

Avoiding the scam

The following is a simple list of precautions that, if followed, should minimize your chances of having a bad roofing experience.

> Always get assessments and estimates from several roofing contractors. Have roofers give you references you can call.

> Carefully read any document that you are asked to sign. Even better, have it reviewed by an attorney.

> Have the roofer you choose provide you with receipts from the roofing supply company ensuring that they have paid for the shingles and call to verify that the bill has been paid.

> Have the roofer you choose provide you with a waiver of lien for themselves and any sub-contractors they may use.

> Consider hiring an independent roofing consultant or home inspector to assess your roof.

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Baucus' huge challenge: health-care reform

WASHINGTON >> Sixteen years after President Bill Clinton called for universal health care, Congress is once again taking up the thorny task of reforming health care in America.
The point man this time is Democrat Max Baucus, an unassuming, neighborly lawyer from Helena, Mont., who chairs the Senate Finance Committee.

For the past year, Baucus has been holding hearings and meeting with various interests to cobble together consensus on what he says is the most difficult legislative challenge of his career.

Baucus, 67, has set broad parameters on what he wants accomplished: It must be bipartisan, it must include a combination of public and private resources, and it must be delivered to President Barack Obama's desk by the end of the year. Everything else, he said, is pretty much negotiable.

"I don't have an ideology," he said.

Comprehensive health-care reform hasn't been tackled in Congress since Clinton's efforts spawned a national backlash that helped cost the Democrats control of Congress 15 years ago.

But advocates say the issue has to be addressed — as unemployment rises, health costs increase and about one in four Americans are either underinsured or have no coverage. With a popular president who wants health-care reform, Baucus knows this may be the only window for action.

Gannett Washington Bureau sat down with the Montana Democrat to talk about the issue and his expectations:

You've called health care a moral and economic imperative. What do you mean?

We can't keep going on like this. Costs are going to go through the roof. American companies will not be able to compete with other countries' companies. Look at GM. They're in a world of hurt in many respects because of their health-care bills. They signed new contracts with employees and retirees to give Cadillac coverage. Holy mackerel, that's expensive. When you buy a car, close to $1,500 of that car is health-care costs in this country. In Japan, it's about $400. If these costs keep going up in America, this make it very, very hard to compete.


It's the right thing to do. People should have health insurance. The United States should have a system where you get access to good, affordable quality health care.
What's the problem with the current system?

We don't have a health-care system in America today. It's a hodgepodge, a collection of many different groups, each providing health care in one way or another: doctors, hospitals, insurance companies, medical device manufacturers, pharmaceuticals. As a consequence, there's a lot of waste in the current system, and health- care quality is very uneven in some parts of America. Many people don't have health insurance, and costs are very high because of the waste.
And you think the system improperly rewards quantity over quality?

We pay doctors and hospitals based on volume. The more services a doctor provides, the more a hospital provides, the more (they) get paid. We don't reimburse on the basis of quality. If you want to buy a new car, you want to know something about the quality of the car. You go to Consumer Reports, you ask a buddy, you kick the tires, you open and close the doors, and you try to get a sense of what the quality is. You don't do that with doctors because you don't know enough about what they do to ask the right questions.
What kind of plan would you like to see in place?

We spend twice as much per capita on health care than do people in the next-most-expensive country. We're the only industrialized country without health insurance for everybody. That's incredible when you stop and think about it. So what's my perfect plan? Basically, I'd like to see a system in America where everyone knows that he or she (has) quality health insurance and will get quality care and costs are manageable, (increasing yearly) at no more than roughly inflation.
Even though Democrats control Congress, you've talked about a plan that has Republican buy-in as well. Why?

I think it's very important to have a bipartisan bill because then it's more sustainable. It will have more national support.
Will this be any different from 1993, when President Bill Clinton's proposal for universal health care went nowhere?

We've learned lessons from '93. The (Clinton) administration gave this 1,600-page bill to Congress and said: "Here it is. Pass it." Obama, on the other hand, said: "Hey Congress, here are some principles. You do it and make it better because you'll give us more buy-in and expose it to more people around the country, so we're less likely to make mistakes."
And you think the time is right?

The problems are much greater now than they were in '93. The costs are much higher. The demand for change is much greater. The stars just seem to be aligned.

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Manufacturer should pay for towing of new car

April 26, 2009

DEAR BRUCE: My husband and I purchased our first new automobile. We were thrilled. We have had so many used cars, and we finally decided that we could afford a new car. You can imagine how unhappy we have been since the car has had to be towed four times. Yes, that's right, four times in the first six weeks that we have owned it. It just keeps quitting. I have to say that the dealer has been very, very accommodating in terms of loaning us automobiles and is sympathetic, telling us that there will be no cost other than the towing. They pay for the first towing but they say that's the only one that they will pay for. Is this reasonable? — G.P. in Pennsylvania

DEAR G.P.: I don't find that reasonable at all. I am assuming that you don't carry towing insurance, either, with an organization such as AAA or on your regular liability insurance policy. You might want to consider picking up one of these coverages. They are very inexpensive. There also is a plan available with most cell companies, if you have a cell phone.

Having said that, if a brand new automobile is breaking down so many times, it seems to me that the manufacturer or the dealer or some combination thereof should pay for the towing. I would bring this to the manufacturer's attention and ask for their opinion.

DEAR BRUCE: My daughter, 25, has started selling items at craft shows. Her challenge is the financial resource needed to purchase the items initially for resale later. I am contemplating investing in this in one of two ways. I would either lend her the money as a loan, which she will repay in installments until she has enough capital to make the purchases herself, or put up the money for the inventory each time, four or five times a year, and then take a percentage of her take.

Her investment is the booth and rental time. We are estimating that she will make between $1,000 and $2,500. I thought 10 percent would be a good percentage — S.W., via e-mail

DEAR S.W.: Since the amount of money is so modest, a straight loan to your daughter, under whatever terms you two agree on, would be the easiest and cleanest way to handle this. You might wish to make it open-ended and, assuming that your daughter is a responsible person, that should work for both of you. I would not get involved in a percentage deal.

DEAR BRUCE: I backed out in my car and hit a lady who was parked across the street. I know that I am wrong. I offered to have the car fixed at my body shop. They estimated the most it would be was $400. She agreed to get it done there. Then all of a sudden she decided to get two other estimates and they wanted $700 and $1,100. Now she says that she wants me to pay her in cash the highest amount. I told her that I would settle and I would take care of this myself as I did not want to make a claim against my insurance company. She demands to know my insurance company's name. Do I have to give it to her? — Reader, via e-mail

DEAR READER: You are not obliged to tell her about your insurance. You must understand that you have no obligation to pay her anything until such time as a court of proper jurisdiction orders you to pay and then they would set the number. When someone is without question, wrong, you make a settlement but when the other side gets unreasonable and demands that you pay the higher amount you simply say you will pay this amount or she will have to go to court and have a judge order that you pay more. The likelihood is that for this kind of money she is not going to make a trip to court. The very basic understanding that you must have is that until such time as a court orders a payment you have no obligation to pay. The reality is though that when you know you are wrong, why go through all the pain of a court appearance? It's obvious she's trying to make an extra buck.

Send your questions to: Smart Money, P.O. Box 2095, Elfers, FL 34680. E-mail to: bruce@brucewilliams.com. Questions of general interest will be answered in future columns. Owing to the volume of mail, personal replies cannot be provided.

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Consider hidden costs before buying a new car

These are interesting times for potential car buyers. Because so many people have become wary of the faltering economy and are avoiding auto showrooms, nervous car manufacturers have been slashing prices, issuing rebates and offering extremely competitive financing terms - at least to people with sound credit - to lure in business.

But for many folks, the temptation to take advantage of those great offers is tempered by fears that government bailouts for automakers won't necessarily ensure their long-term solvency. That uncertainty, in turn, casts doubt on the viability of their long-term product warranties.

If you are thinking about trading in your old car for a newer model, keep these financial factors in mind:

l Depreciation. New cars typically lose 20 percent or more in value once driven off the lot. Thus, on a $25,000 loan with 10 percent down, you would automatically owe $22,500 for a car that might only be worth $20,000. If you had to sell it suddenly, could you come up with an extra $2,500 to pay off the loan?

l Insurance. Insuring a new car is often much more expensive than with older vehicles. Before purchasing, ask your carrier for estimates on a few different models for comparison's sake. And ask for a quote on gap coverage, which will pay the difference between the car's actual cash value (factoring in depreciation) and your outstanding loan or lease balance, should the car be stolen or totaled in an accident.

l Taxes and fees. When calculating how much car can you afford, don't forget about sales tax and fees for title, registration and license plates that could add anywhere from a few hundred to several thousand dollars to the purchase price. Ask the Department of Motor Vehicles for current fee rates.

l Your credit rating. A strong credit rating will qualify you for the best interest rates from auto manufacturers' financing arms, banks and credit unions. But with only fair or mediocre credit, you'll likely pay higher rates and qualify for lower loan limits - if you're eligible for a loan at all.

Review your credit reports before seeking financing so you can correct any errors, omissions and fraudulent activities that could seriously impact your credit score. You're allowed to order one free report per year from each of the three major credit bureaus at www.annual
creditreport.com.

You can purchase your credit scores for about $15 each at www.myfico.com. Or, to estimate your credit score for free, visit What's My Score, a financial literacy program run by Visa Inc. (www.whatsmyscore.org/estimator.) The site also features tips on repairing damaged or unestablished credit scores.

l Do research. Find out in advance the invoice price (dealer's cost, minus incentives) and bargain up from that, rather than down from the manufacturer's recommended "sticker price." Research invoice amounts online at sites like Kelly Blue Book (www.kbb.com), www.edmunds.com, and www.cars.com.

l Trade-ins vs. separate sale. You may prefer the convenience of trading in your old car with the dealer, although you can probably get more selling it on your own. Just be sure to treat it as a separate transaction after you've settled on a sales price and loan terms.

Remember, there are many car-buying considerations besides color and option packages that will impact your financial bottom line. For a comprehensive guide to buying or leasing a car, including financing considerations, visit Visa's free personal financial management site, Practical Money Skills for Life (www.practi
calmoneyskills.com/car).

Jason Alderman directs Visa's financial education programs. To participate in a free, online Financial Literacy and Education Summit go to www.practicalmoneyskills.com/summit2009.

GM to Cut Health Care, Insurance Coverage

Retirees who were paid salaries will take a hit, as the Detroit-based automaker will cut health care benefits and reduce life-insurance coverage for some who are under 65, according to an internal document obtained by TheStreet.com. GM, which is straining under employee obligations and corporate debt, spent $103 billion to fund so-called legacy pensions and retiree health care costs from 1993 to 2007 alone.

GM, the largest U.S. carmaker, said Feb. 10 it plans to slash 10,000 salaried jobs and lower pay by as much as 10%.

The company will withdraw health care benefits for salaried retirees, surviving spouses and eligible dependents under age 65 who may receive Medicare. The changes take effect Jan. 1, 2010. Starting May 1, 2009, life-insurance coverage provided by GM at two times a worker's salary will be cut to 75% of the salary upon retirement. After 10 years, the rate will be reduced by an additional 25%. Current retirees also will be affected.

GM spokesman Tom Wilkinson said the company would establish a company-funded health reimbursement account, called an HRA. GM will make a $260 tax-free monthly contribution to an HRA for affected retirees or surviving spouses. When a retiree reaches age 65, an additional monthly pension payment of $300, announced last summer, will be paid.

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9 ways to lower your auto insurance costs

1. Ask for higher deductibles

Request higher deductibles on collision and comprehensive (fire and theft) coverage and lower your costs substantially. For example, increasing your deductible from $200 to $500 could reduce your collision and comprehensive cost by 15 percent to 30 percent.

2. Drop collision and/or comprehensive coverages on older cars

It may not be cost effective to have collision or comprehensive coverage on cars worth less than $1,000 because any claim you make would not substantially exceed annual cost and deductible amounts. Auto dealers and banks can tell you your car’s worth.

3. Buy a “low profile” car

Before you buy, check insurance costs because fast and expensive cars that cost more to repair and are a favorite target for thieves have much higher insurance costs.

4. Take advantage of low mileage discounts

Some companies offer discounts to motorists who drive a limited number of miles a year.

5. Consider insurance cost in your neighborhood

Costs tend to be lowest in rural communities and highest in cities where there is more traffic congestion.

6. Discount possibility: automatic seat belt or air bag

You may be able to take advantage of discounts on some coverage if you have automatic seat belts and/or air bags.

7. Discount possibility: anti-lock brakes

Anti-lock brakes improve steering control and stability when a car is brought to a stop, thus reducing accidents. Some states, including Florida, New Jersey and New York, require insurers to give discounts for cars equipped with the brakes and some insurers have a nationwide discount in place.

8. Comparison shop

Prices for the same coverage can vary by hundreds of dollars, so it pays to shop around. Look online, ask friends or call your state insurance department. But don’t shop price alone.

The insurer you select should offer both fair prices and excellent service. Quality personal service may cost a bit more, but provides added conveniences. Ask companies what they would do to lower your costs and check the financial ratings of the companies with an online search engine to make sure they’re financially sound.

Once you’ve narrowed the field to three insurers, get price quotes.

9. Discount possibility: “other” discounts

Some insurers offer discounts for more than one car, no accidents in three years, drivers over 50 years of age, driver training courses, anti-theft devices, and good grades for students.

Source: Insurance Information Network of California

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