Continuing Case 28. Property Insurance Newlyweds Jamie Lee and Ross have had several milestones in the past year. They are newly married, recently purchased their first home, and now have twins on the way! Jamie Lee and Ross have to seriously consider their insurance needs. With a family, a home, and now babies on the way, they are working on developing a risk management plan to help them should an unexpected event arise. Jamie Lee and Ross created a Household Inventory (see Addendum), excluding the $2,000 diamond wedding band set. They have elected not to get any further liability or other specialized coverage at this time. Currently, their home has increased in value by $12,000 since they purchased it five years ago. If something unfortunate should happen they want to ensure that they are able to rebuild their home using the most current costs. Use this information to complete the table below and determine the total amount of property Insurance coverage they will need. Each answer must have a value for the assignment to be complete. Enter "O" for any unused categories. Current Financial Situation Assets: Income: $4,300 Gross income (Jamie Lee) $50,000 Checking account Savings account Emergency fund savings account $37,500 S IRA balance $75,000 $64,000 Car (Jamie Lee) Car (Ross) $22,200 Net income after taxes (Jamie Lee) $20,500 Gross income (Ross) $26,000 Net income after taxes (Ross) $10,000 Monthly Expenses: $18,000 Mortgage Property taxes and insurance $1,225 Liabilities: $500 Student loan balance $0 Utilities $195 Credit card balance $2,000 Food $400 Car loans $6,000 $275 Gas/maintenance Credit card payment $250 Original purchase price of home $273,000 Car loan payment $289 Entertainment $300 B G 1 Home Inventory with Estimated Replacement Values - Calculate the total replacement cost for household. 2 Closets/Hallway: Value Attic: Value Bathrooms: Tenor Saxaphone $450.00 4 pc. Luggage set $85.00 Linens, towels, shower curtain Vacuum cleaner $90.00 Holiday decorations $200.00 Rugs Winter Coats $600.00 Off-season clothing $300.00 Electric Toothbrush Table/Mirror $350.00 Value $350.00 $40.00 $50.00 4 Personal Belongings: Value Bedrooms: Clothing $4,000.00 Master Bedroom Furniture Jewelry (excluding wedding rings) $300.00 Guest Bedroom Furniture Nursery Furniture (twins) Value Family Room: $1,500.00 Sofa Set $1,200.00 TV $2,000.00 Lamps Value $1,800.00 $2,000.00 $200.00 5 6 Garage: Lawn mower Tools Bicycles Golf Clubs Lawn Tools Value $250.00 $150.00 $250.00 $200.00 $50.00 Kitchen/Dining Table/chairs Refrigerator Dishwasher Microwave Toaster Coffee Maker Value $800.00 $500.00 Value Electronics: $750.00 Laptop Computer $1,400.00 Tablet Computer $450.00 $120.00 $30.00 $150.00 7 8 Total value: 9 10 11 12 13 Real Property (not applicable to renters) Current replacement value of home $ 285,000.00 Personal Property Estimated value of appliances, furniture, clothing, and other household items (conduct an inventory) Type of coverage for personal property es Additional coverage for items with limits on standard personal coverage such as jewelry, firearms, silverware, and photographic, electronic, and computer equipment Diamond wedding band set 2,000.00 Personal Liability Amount of additional personal liability coverage desired for possible personal injury claims Specialized Coverages If appropriate, investigate flood or earthquake coverage excluded from home insurance policies = Total Property Insurance Needed Continuing Case 28. Property Insurance Newlyweds Jamie Lee and Ross have had several milestones in the past year. They are newly married, recently purchased their first home, and now have twins on the way! Jamie Lee and Ross have to seriously consider their insurance needs. With a family, a home, and now babies on the way, they are working on developing a risk management plan to help them should an unexpected event arise. Jamie Lee and Ross created a Household Inventory (see Addendum), excluding the $2,000 diamond wedding band set. They have elected not to get any further liability or other specialized coverage at this time. Currently, their home has increased in value by $12,000 since they purchased it five years ago. If something unfortunate should happen they want to ensure that they are able to rebuild their home using the most current costs. Use this information to complete the table below and determine the total amount of property Insurance coverage they will need. Each answer must have a value for the assignment to be complete. Enter "O" for any unused categories. Current Financial Situation Assets: Income: $4,300 Gross income (Jamie Lee) $50,000 Checking account Savings account Emergency fund savings account $37,500 S IRA balance $75,000 $64,000 Car (Jamie Lee) Car (Ross) $22,200 Net income after taxes (Jamie Lee) $20,500 Gross income (Ross) $26,000 Net income after taxes (Ross) $10,000 Monthly Expenses: $18,000 Mortgage Property taxes and insurance $1,225 Liabilities: $500 Student loan balance $0 Utilities $195 Credit card balance $2,000 Food $400 Car loans $6,000 $275 Gas/maintenance Credit card payment $250 Original purchase price of home $273,000 Car loan payment $289 Entertainment $300 B G 1 Home Inventory with Estimated Replacement Values - Calculate the total replacement cost for household. 2 Closets/Hallway: Value Attic: Value Bathrooms: Tenor Saxaphone $450.00 4 pc. Luggage set $85.00 Linens, towels, shower curtain Vacuum cleaner $90.00 Holiday decorations $200.00 Rugs Winter Coats $600.00 Off-season clothing $300.00 Electric Toothbrush Table/Mirror $350.00 Value $350.00 $40.00 $50.00 4 Personal Belongings: Value Bedrooms: Clothing $4,000.00 Master Bedroom Furniture Jewelry (excluding wedding rings) $300.00 Guest Bedroom Furniture Nursery Furniture (twins) Value Family Room: $1,500.00 Sofa Set $1,200.00 TV $2,000.00 Lamps Value $1,800.00 $2,000.00 $200.00 5 6 Garage: Lawn mower Tools Bicycles Golf Clubs Lawn Tools Value $250.00 $150.00 $250.00 $200.00 $50.00 Kitchen/Dining Table/chairs Refrigerator Dishwasher Microwave Toaster Coffee Maker Value $800.00 $500.00 Value Electronics: $750.00 Laptop Computer $1,400.00 Tablet Computer $450.00 $120.00 $30.00 $150.00 7 8 Total value: 9 10 11 12 13 Real Property (not applicable to renters) Current replacement value of home $ 285,000.00 Personal Property Estimated value of appliances, furniture, clothing, and other household items (conduct an inventory) Type of coverage for personal property es Additional coverage for items with limits on standard personal coverage such as jewelry, firearms, silverware, and photographic, electronic, and computer equipment Diamond wedding band set 2,000.00 Personal Liability Amount of additional personal liability coverage desired for possible personal injury claims Specialized Coverages If appropriate, investigate flood or earthquake coverage excluded from home insurance policies = Total Property Insurance Needed