March 21, 2025 • 8 mins
Why Is Having The Right Coverage Important?
Protection isn't automatic when you purchase an insurance policy—it's defined by the specific terms, provisions, and exclusions within your contract. Timothy Walters draws back the curtain on this common misconception that leaves many policyholders vulnerable to unexpected out-of-pocket expenses after a claim.
The podcast explores how different life situations require tailored insurance solutions. Whether you're a homeowner, landlord, or renter, each scenario demands specific coverage considerations. Timothy explains why landlords should require tenants to maintain renter's insurance and how homeowners with rental rooms need special policy endorsements to avoid coverage denials. For life insurance, he breaks down how needs shift throughout life stages, from term policies that cover specific periods to permanent solutions offering lifelong protection.
Connect with an experienced agent who can guide you through these complex decisions and ensure you're genuinely protected when it matters most. Call or text The Walters Agency for a free consultation to assess your current coverage.
To learn more about The Walters Agency visit:
https://www.brightway.com/agencies/tn/knoxville/0237/team
The Walters Agency
7009 Asheville Hwy
Knoxville, TN 37924
423-417-2070
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:04):
Welcome to the Walters Agency podcast, where
insurance meets peace of mind.
Hosted by licensed insuranceagent and owner, timothy Walters
, we're here to help families,homeowners and small business
owners throughout East Tennesseeprotect what matters most Our
mission creating win-win-winsolutions for insurance.
Let's dive in.
Speaker 2 (00:34):
Insurance isn't just about checking a box.
It's about protecting whatmatters most, whether it's your
home, business or family.
Having the right coverage canmean the difference between
peace of mind and financialdisaster.
But what exactly does the rightcoverage look like and how do
you know if you're protectedagainst the unexpected?
Welcome back everybody.
(00:54):
Skip Monty here, co-host, slashproducer, back in the studio
with Timothy Walters.
Timothy, how are you doingtoday?
Speaker 3 (01:02):
All right, Skip.
How are you doing, buddy?
Speaker 2 (01:04):
Doing just fine.
I've got a big question to ask,skip, how are you doing, buddy?
Doing just fine.
I've got a big question to ask,though.
Speaker 3 (01:15):
So, in the insurance world, why is having the right
coverage important?
Well, that's a good question,skip, and it's one a lot of
people don't ask themselvesuntil they've had a claim.
So the reason that you want tohave the right coverage is, if
you don't and something happensthat falls outside of the
coverage in your contract, thenyou don't have coverage.
Unfortunately, a lot of peoplehave it in their minds that,
well, they got their homeowner'sinsurance or their auto
insurance or their lifeinsurance or their business
(01:37):
insurance, they got this policy,so everything's covered, and
that is not true.
Insurance policies arecontracts, so there's
limitations.
There's things that that is nottrue.
Insurance policies are contracts, so there's limitations.
There's things that arespecifically provided for,
there's things that arespecifically excluded and
there's things that maybe fallin the cracks in between.
And so kind of knowing whatyou're actually covered for,
knowing what you have, isimportant.
(02:00):
And that's where, like I said,having a good agent who's going
to have a decent understandingabout hey, what kind of
insurance product do you have,can they kind of vouch for the
quality and the coverage in thatproduct or at least explain to
you some of the limitations ofwhat it does and what it doesn't
do, is important.
Speaker 2 (02:18):
So that sounds like a factor that I should consider
when updating my coverage.
Are there other things that weshould consider?
Speaker 3 (02:26):
Well, yeah, you should always consider what
you're trying to accomplish withyour insurance.
That's going to depend on whatkind of insurance are you taking
out.
Are you trying to protect ahome that you live in that's
your primary residence, that youneed to protect not only the
value of the structure fromcompletely being destroyed and
having to be rebuilt or maybethe roof gets taken off in a
hurricane or it's in a tornadoor something but your personal
(02:49):
property in the house?
Do you rent rooms out in yourhouse, in which case some
insurance contracts are going tocompletely exclude that and if
they find out that you're doingit behind their back, they're
going to cancel your policy.
Some companies will let you dothat with an endorsement and
they're fine with it.
Do you own a property that yourent out to other people, like a
long-term rental property?
(03:11):
Well, there's a completelydifferent type of insurance form
for that from the regularhomeowner's insurance.
It protects your legalliability as a landlord.
It protects the value of thehome, but it's not going to have
a lot of coverage for propertythat you own and your tenant.
If they want to protect theirproperty, they're going to have
a renter's insurance policy andyou're going to want them to
have a renter's insurance policyto create some separation and a
(03:32):
legal liability on that lotfrom them and you.
I always recommend landlordsrequire that their tenants
maintain renter's insurance.
It's not expensive or take to acompletely different place life
insurance.
A lot of people buy lifeinsurance when they're young.
They're buying houses, they'rehaving kids, maybe they don't
(03:52):
have a lot of income month tomonth to devote to that, so
maybe they get a term lifeinsurance policy like a 20 or 30
year term to cover, like theirmajor debt exposures, like their
mortgage or something like that, like that.
But if they can afford it, Ialways recommend people look
into a whole life solution whichis permanent life insurance or
(04:18):
maybe a term policy that they'recalled return a premium where
if you survived to the end ofthe 20 or 30 years, all the
money you paid into it comesback to you, that they can be
invested in something else.
But it really kind of dependson what stage of life you're at,
what kind of risk you're tryingto mitigate and again, that's
why having an agent you can talkto about this, because this is
what this is what we do, likewe're we're nerds, we swim in
this, most of us, uh, andbecause it's a little bit crazy,
(04:38):
but most of us do know whatwe're talking about.
If we've been doing it longenough and you know insurance is
like anything else, unlessyou're in it all the time it can
be kind of like Greek.
It might be hard to understand.
I'm not a super smart guy, butI've been doing it a long time
so I can advise people on hey,what does this?
Speaker 2 (04:58):
do?
What does it not do?
Would I recommend it to you?
Wow, well, so it's obviouslyimportant to have the right
coverage.
What are the biggest risks ifyou don't have the right
coverage?
Speaker 3 (05:08):
Again, if you don't have the right coverage, you
could be in a situation where,worst case scenario, you don't
have coverage.
Maybe a less worst casescenario, maybe the coverage
isn't exactly what you expectedit to be.
So, real world example roofs ona house.
Okay, there's two basic typesof loss provisions in homeowners
insurance.
(05:28):
It's one's full replacementcost.
Now, that's kind of a misnomer.
People think, oh well, that'sjust going to replace everything
like new.
You know, yada, yada, yada.
Well, yes, but with someprovisions.
You know you have yourdeductible, you have your policy
deductible.
So again, let's use the roof asan example.
If a windstorm comes by andtakes all the shingles off of
(05:48):
your roof and to replace itcosts $20,000 and you have a
$1,000 deductible, well, theinsurance company is not going
to give you $19,000 to replacethe roof if you have replacement
value loss provision on yourpolicy.
The other common one is calledtypically actual cash value
depreciation.
Sometimes it's called a roofmaterials payment schedule.
(06:11):
Same thing, basically.
They look at the age of theroof and they're going to say,
well, this roof was so-called30-year shingle roofs and I'm
not going to get into thequality of shingles these days
but a 30-year shingle roofthat's 15 years old.
Well, it's halfway through itslifespan.
So they're going to depreciatethe value of that roof by half
50%, so that's $10,000, and thentake your deductible, so you'll
(06:34):
get $9,000 from the insurancecompany to help go towards
replacing your roofing and therest is out of pocket.
So unfortunately, a lot ofpeople when they look at their
insurance policies, all they'relooking at is the price tag,
right, the premium.
They want the lowest, they wantthe cheapest insurance possible
here every day, and if you tryto explain some of this stuff to
you sometimes people getimpatient with it.
But it is important for you tounderstand.
(06:56):
At least you know.
Hey, I went with a cheaperpolicy.
But the roof, if I do have atotal loss on my roof, you know,
depending on how old it is, Imight be out of pocket a lot
more money than I expected to be, whereas if I go with this
other policy, maybe it's alittle bit more per year.
But if I do have a total losson the roof, then the insurance
company is going to pay thelion's share to replace my roof.
(07:17):
And speaking from my ownpersonal experience, even right
now, I don't have $5,000 or$10,000 in my hip pocket to
replace a roof right now.
So paying a little bit extrafor that extra protection on my
homeowner's insurance isactually probably a smart
financial decision for mepersonally.
Other people maybe.
They have cash to burn and theywant to pay less per month on
(07:37):
their insurance, and that's finetoo.
But not understanding it andthen something happens is when
people get upset and I see ithappen.
Speaker 2 (07:44):
Absolutely Well, you know that is something.
Roof insurance is somethingthat I would love to delve
deeper into, perhaps in a futureepisode, Maybe we can.
We can delve into that a littledeeper, because it's a there's
a lot to that, I know frompersonal experience.
Speaker 3 (08:01):
Yeah, man, I'll set you up a policy.
You know All right, All right,sounds good.
Speaker 2 (08:05):
All right, love it, timothy.
Appreciate what you're doingand we'll catch you in the next
episode awesome, thank youthat's a wrap on this episode of
the walters agency podcast.
Speaker 1 (08:19):
Ready to find the right coverage for your home,
business or family, call or text423-417-2070 for a free
20-minute consultation.
Until Until next time, staycovered, stay protected and keep
winning with the Walters Agency.
Welcome to the Walters Agency podcast, where
insurance meets peace of mind.
Hosted by licensed insuranceagent and owner, timothy Walters
, we're here to help families,homeowners and small business
owners throughout East Tennesseeprotect what matters most Our
mission creating win-win-winsolutions for insurance.
Let's dive in.
Speaker 2 (00:34):
Insurance isn't just about checking a box.
It's about protecting whatmatters most, whether it's your
home, business or family.
Having the right coverage canmean the difference between
peace of mind and financialdisaster.
But what exactly does the rightcoverage look like and how do
you know if you're protectedagainst the unexpected?
Welcome back everybody.
(00:54):
Skip Monty here, co-host, slashproducer, back in the studio
with Timothy Walters.
Timothy, how are you doingtoday?
Speaker 3 (01:02):
All right, Skip.
How are you doing, buddy?
Speaker 2 (01:04):
Doing just fine.
I've got a big question to ask,skip, how are you doing, buddy?
Doing just fine.
I've got a big question to ask,though.
Speaker 3 (01:15):
So, in the insurance world, why is having the right
coverage important?
Well, that's a good question,skip, and it's one a lot of
people don't ask themselvesuntil they've had a claim.
So the reason that you want tohave the right coverage is, if
you don't and something happensthat falls outside of the
coverage in your contract, thenyou don't have coverage.
Unfortunately, a lot of peoplehave it in their minds that,
well, they got their homeowner'sinsurance or their auto
insurance or their lifeinsurance or their business
(01:37):
insurance, they got this policy,so everything's covered, and
that is not true.
Insurance policies arecontracts, so there's
limitations.
There's things that that is nottrue.
Insurance policies are contracts, so there's limitations.
There's things that arespecifically provided for,
there's things that arespecifically excluded and
there's things that maybe fallin the cracks in between.
And so kind of knowing whatyou're actually covered for,
knowing what you have, isimportant.
(02:00):
And that's where, like I said,having a good agent who's going
to have a decent understandingabout hey, what kind of
insurance product do you have,can they kind of vouch for the
quality and the coverage in thatproduct or at least explain to
you some of the limitations ofwhat it does and what it doesn't
do, is important.
Speaker 2 (02:18):
So that sounds like a factor that I should consider
when updating my coverage.
Are there other things that weshould consider?
Speaker 3 (02:26):
Well, yeah, you should always consider what
you're trying to accomplish withyour insurance.
That's going to depend on whatkind of insurance are you taking
out.
Are you trying to protect ahome that you live in that's
your primary residence, that youneed to protect not only the
value of the structure fromcompletely being destroyed and
having to be rebuilt or maybethe roof gets taken off in a
hurricane or it's in a tornadoor something but your personal
(02:49):
property in the house?
Do you rent rooms out in yourhouse, in which case some
insurance contracts are going tocompletely exclude that and if
they find out that you're doingit behind their back, they're
going to cancel your policy.
Some companies will let you dothat with an endorsement and
they're fine with it.
Do you own a property that yourent out to other people, like a
long-term rental property?
(03:11):
Well, there's a completelydifferent type of insurance form
for that from the regularhomeowner's insurance.
It protects your legalliability as a landlord.
It protects the value of thehome, but it's not going to have
a lot of coverage for propertythat you own and your tenant.
If they want to protect theirproperty, they're going to have
a renter's insurance policy andyou're going to want them to
have a renter's insurance policyto create some separation and a
(03:32):
legal liability on that lotfrom them and you.
I always recommend landlordsrequire that their tenants
maintain renter's insurance.
It's not expensive or take to acompletely different place life
insurance.
A lot of people buy lifeinsurance when they're young.
They're buying houses, they'rehaving kids, maybe they don't
(03:52):
have a lot of income month tomonth to devote to that, so
maybe they get a term lifeinsurance policy like a 20 or 30
year term to cover, like theirmajor debt exposures, like their
mortgage or something like that, like that.
But if they can afford it, Ialways recommend people look
into a whole life solution whichis permanent life insurance or
(04:18):
maybe a term policy that they'recalled return a premium where
if you survived to the end ofthe 20 or 30 years, all the
money you paid into it comesback to you, that they can be
invested in something else.
But it really kind of dependson what stage of life you're at,
what kind of risk you're tryingto mitigate and again, that's
why having an agent you can talkto about this, because this is
what this is what we do, likewe're we're nerds, we swim in
this, most of us, uh, andbecause it's a little bit crazy,
(04:38):
but most of us do know whatwe're talking about.
If we've been doing it longenough and you know insurance is
like anything else, unlessyou're in it all the time it can
be kind of like Greek.
It might be hard to understand.
I'm not a super smart guy, butI've been doing it a long time
so I can advise people on hey,what does this?
Speaker 2 (04:58):
do?
What does it not do?
Would I recommend it to you?
Wow, well, so it's obviouslyimportant to have the right
coverage.
What are the biggest risks ifyou don't have the right
coverage?
Speaker 3 (05:08):
Again, if you don't have the right coverage, you
could be in a situation where,worst case scenario, you don't
have coverage.
Maybe a less worst casescenario, maybe the coverage
isn't exactly what you expectedit to be.
So, real world example roofs ona house.
Okay, there's two basic typesof loss provisions in homeowners
insurance.
(05:28):
It's one's full replacementcost.
Now, that's kind of a misnomer.
People think, oh well, that'sjust going to replace everything
like new.
You know, yada, yada, yada.
Well, yes, but with someprovisions.
You know you have yourdeductible, you have your policy
deductible.
So again, let's use the roof asan example.
If a windstorm comes by andtakes all the shingles off of
(05:48):
your roof and to replace itcosts $20,000 and you have a
$1,000 deductible, well, theinsurance company is not going
to give you $19,000 to replacethe roof if you have replacement
value loss provision on yourpolicy.
The other common one is calledtypically actual cash value
depreciation.
Sometimes it's called a roofmaterials payment schedule.
(06:11):
Same thing, basically.
They look at the age of theroof and they're going to say,
well, this roof was so-called30-year shingle roofs and I'm
not going to get into thequality of shingles these days
but a 30-year shingle roofthat's 15 years old.
Well, it's halfway through itslifespan.
So they're going to depreciatethe value of that roof by half
50%, so that's $10,000, and thentake your deductible, so you'll
(06:34):
get $9,000 from the insurancecompany to help go towards
replacing your roofing and therest is out of pocket.
So unfortunately, a lot ofpeople when they look at their
insurance policies, all they'relooking at is the price tag,
right, the premium.
They want the lowest, they wantthe cheapest insurance possible
here every day, and if you tryto explain some of this stuff to
you sometimes people getimpatient with it.
But it is important for you tounderstand.
(06:56):
At least you know.
Hey, I went with a cheaperpolicy.
But the roof, if I do have atotal loss on my roof, you know,
depending on how old it is, Imight be out of pocket a lot
more money than I expected to be, whereas if I go with this
other policy, maybe it's alittle bit more per year.
But if I do have a total losson the roof, then the insurance
company is going to pay thelion's share to replace my roof.
(07:17):
And speaking from my ownpersonal experience, even right
now, I don't have $5,000 or$10,000 in my hip pocket to
replace a roof right now.
So paying a little bit extrafor that extra protection on my
homeowner's insurance isactually probably a smart
financial decision for mepersonally.
Other people maybe.
They have cash to burn and theywant to pay less per month on
(07:37):
their insurance, and that's finetoo.
But not understanding it andthen something happens is when
people get upset and I see ithappen.
Speaker 2 (07:44):
Absolutely Well, you know that is something.
Roof insurance is somethingthat I would love to delve
deeper into, perhaps in a futureepisode, Maybe we can.
We can delve into that a littledeeper, because it's a there's
a lot to that, I know frompersonal experience.
Speaker 3 (08:01):
Yeah, man, I'll set you up a policy.
You know All right, All right,sounds good.
Speaker 2 (08:05):
All right, love it, timothy.
Appreciate what you're doingand we'll catch you in the next
episode awesome, thank youthat's a wrap on this episode of
the walters agency podcast.
Speaker 1 (08:19):
Ready to find the right coverage for your home,
business or family, call or text423-417-2070 for a free
20-minute consultation.
Until Until next time, staycovered, stay protected and keep
winning with the Walters Agency.
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