Author: Steve G

Insurance blog, articles, and news written by Stephen Gebhardt, founder and CEO of Gebhardt Insurance Group an Insurance agency in Casa Grande, Arizona.

Medicare Plan Options Maricopa AZ

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Medicare Plan Options

Medicare is a federal program established back in 1965 largely in response to difficulties that older Americans were having in obtaining private medical insurance. At the beginning of 2019, there were more than 38 million people enrolled in Original Medicare and more than 22 million participating in various Medicare Advantage plans.

Medicare has been credited with significantly improving the well-being of mature Americans. When originally implemented, prescription drugs were not as widely used as they are today. In recent years, the program has added measures such as Part D in efforts to keep pace with this trend in healthcare.

Medicare Basics

There are several parts of the Medicare program that address different medical concerns. Part A can be viewed as largely used for hospital-based care. It is used for inpatient hospital expenses, skilled nursing facility care, and hospice care. Expenses can quickly accumulate in these settings. The services provided by doctors while in the hospital are largely covered by Medicare Part B.

Medicare Part B is used for services provided by physicians and other medical providers. It covers various preventive care services including vaccinations, screenings, etc. Home health care services may potentially be covered by Part A or Part B based on the circumstances. Durable medical equipment such as wheelchairs, specialized beds, and others are typically paid for by Part B.

In 2019, Part B had a $185 annual deductible for most participants. This is an amount that the patient must pay before the Part B coverage begins paying. It can be compared to the deductible that applies to comprehensive and collision automobile insurance coverage. After the deductible has been paid, Medicare typically pays 80% of the subsequent costs.

In 2006, Medicare Part D was implemented to assist with the costs of prescription drugs. This optional program is managed by private insurers that follow Medicare guidelines. There are a host of various Part D plans with differing costs and coverages. Those with Original Medicare generally choose one of three types of prescription plans as follows:

  • PDP: This stands for Medicare Prescription Drug Plans, which is for those with Part A and/or Part B
  • PFFS: These are Private Fee-for-Service plans for those in Medicare Advantage Plans with a designated provider network
  • MSA: Medical Savings Account plans are similar to Health Savings Accounts (HSAs) that those not enrolled in Medicare commonly use.

Understanding Original Medicare

Original Medicare is essentially comprised of parts A, B, and D. There is typically a monthly payment or premium for Part B coverage and then a separate Part D premium. Those with Original Medicare are typically required to pay a 20% coinsurance “out-of-pocket.”

With the costs of medical treatment today, this 20% can begin to be very costly for many. This is one reason why “Medigap” supplemental coverage plans are popular. Based on financial considerations, some people qualify for assistance from Medicaid to cover coinsurance.

Medicare Advantage

Some individuals opt to participate in a Medicare Advantage plan, often referred to as “Part C.” There are many varieties of these plans. They do cover all “medically necessary” treatment based on Original Medicare guidelines. Advantage plans are popular among those seeking coverage for hearing, vision, dental, and others. They typically also include a prescription drug plan.

Medicare Advantage Plans are managed by private insurance companies and typically require that treatment is provided by their “in-network” providers. Those who use an “out-of-network” medical provider should expect to pay additional “out-of-pocket” expenses. Some of the types of Advantage options include Health Maintenance Organization (HMO) and Preferred Provider Organization (PPO) plans.

Important Terms to Know:

  • Coinsurance: This is a percentage of costs that the patient must pay for services after any deductible is satisfied. (Usually 20%)
  • Copayment: This is a fixed amount that a patient pays for certain services or supplies. For example, the plan may require a $10 copayment when picking up a prescription or a $20 copayment for a doctor visit.
  • Premium: A monthly or other periodic payment required for participation in these types of plans.
  • Preventative services: This is also sometimes called “wellness care” services. These include flu shots, mammograms that screen for breast cancer, Pap tests, etc.

Enrollment Times

Once an individual turns 65 they are typically eligible for Medicare three months later. Those who are eligible that have not enrolled may do so during “special enrollment” periods. These eligibility and enrollment provisions vary based on the circumstances. You may want to discuss your options with an insurance professional.

Rights Regarding Medicare

There are some basic rights that those on Medicare are entitled to. All participants are to be treated “with dignity and respect” and not be subjected to any forms of discrimination. All personal and health-related information is to be kept private. Emergency care services are to be covered and participants always have a right to file a grievance regarding the quality of care.

Arizona State Health Insurance Assistance Program (SHIP)

SHIP is a “counseling service” available to all Arizona’s Medicare beneficiaries to help them navigate the program. This assistance may benefit those trying to determine a program that is best suited for their needs. Another option is to consult with an experienced insurance professional that can easily explain your options.

Choosing an Independent Insurance Agency

Why might an independent insurance agency be particularly helpful in understanding Medicare? An independent agent represents its customers instead of any specific insurance company. Independent agents recognize that their customers benefit from the ability to review policies from many carriers. This applies to find competitive rates as well as identifying a solution that is best suited for your individual needs.

Established Insurance Provider in Arizona

The team of professionals at the Gebhardt Insurance Group is a tremendous resource for advice on Medicare. Our expertise extends well beyond Medicare. Clients have been experiencing excellent customer service and support for many years now. This includes insurance products to protect your home, life, automobile, business, and more. Contact our office today at (520) 518-8008.

Permit Bonds Maricopa

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Surety bonds are issued as a commitment that assumes liability if another party fails or defaults on an obligation that they have made. A surety bond involves three parties who enter a contract based on the provisions within a surety bond agreement. They may be required by governmental entities, by owners of a specific project or to maintain compliance in certain occupations or business markets.

There are three distinct parties to these bond agreements. The principal is the party that must satisfy the bonding requirement. Without securing a surety bond, the principal would be unable to conduct business with an obligee. The obligee is the party that instituted the bonding requirement. This may be an individual, government entity or organization.

The surety company is the third party to the agreement that is assuming liability on behalf of the principal. Issuers of surety bonds in Arizona must have met the requirements specified by Arizona law.

Contract Surety Bonds

Surety bonds are broadly categorized as either contract or commercial bonds. A contract bond may be necessary for contractors that are seeking to obtain licensure or to become eligible to bid on specific construction projects. The bond serves as a safety measure if the contractor fails to satisfy an obligation.

A contract bond will allow for financial compensation for the project owner (principal) if the project is not completed or is not completed correctly based on the terms of the agreement. Financial compensation from these bonds also may be used to pay others involved, such as suppliers or subcontractors that were not compensated.

Commercial Surety Bonds

There are also many types of commercial surety bonds. Often they are a requirement from a governmental entity. Some of the more common commercial surety bonds include the following:

  • Those conducting business in certain industries or working in some professions may need to secure license and permit bonds. Some of these bonds apply to freight or mortgage brokers, automobile dealers, and more.
  • Judicial or court bonds may be required among parties involved in legal matters.
  • Probate, trustee or fiduciary bonds may be legally required. These apply to someone assuming a fiduciary or “entrusted” role for the property or assets of others. This includes an administrator appointed to manage a family’s estate.
  • Some public officials may require bonding. These include government officials that oversee important public assets. An example may include those managing the treasury.
  • Miscellaneous bonds are simply those unable to be classified within other categories. They may be required by those who accrue fuel taxes or consume significant utility resources, and many more.

Who Issues Surety Bonds?

Surety bonds may be issued by an organization that specializes in these products or those who offer a variety of related products. Often sureties are issued by certain divisions of insurance companies or those operating in other financial product markets. In Arizona, these organizations must be licensed to do business by the Department of Insurance.

When issuing surety bonds, these organizations undertake a process that is similar to the underwriting process conducted by insurers. The issuer of the bond must make an assessment based on the potential risk involved. The issuer may review the buyer’s credit history, the base of assets, and other indicators related to financial stability.

Permit Bond Overview

Certain businesses are required by law to complete pre-licensing requirements. License and permit bonds are generally among the provisions that are necessary for legal operation. These bonds are part of the overall commitment that is made to adhere to laws and regulations required by federal, state, and local agencies. License and permit bonds also protect the customers of the business, which may include consumers and governmental entities.

License and permit bonds can be viewed as insurance the business pays for the protection of others. Those who honor their commitments and abide by the law rarely have any claims made against their bond. If a claim is made against the bond and paid by the surety company, the business is then responsible for repayment.

Why Might a Permit Be Required in Maricopa County?

One local agency that has permitting requirements is the Maricopa County Department of Transportation (MCDOT). They require that a permit be obtained for projects involving the roads, which generally require bonding. Examples include repairs or installations of sidewalks, curbs, and underground utility lines. In some cases, structural projects that involve “signs, mailboxes, fences, and landscaping” will require permits.

General Surety Bond Requirements in Maricopa County

Some of the general bonding provisions or conditions implemented by MCDOT include the following:

  • Parties may not cancel a bond until related work is completed and approved by the County, thus “releasing” the bond
  • The surety bond issuer may only be deemed liable up to the amount of the bond
  • If a project is not completed within the specified time, the bond may need to be extended for a short period
  • If the project is well behind the completion schedule, the principal may be deemed as in default and a claim against the bond may occur
  • If a claim is made, the issuer of the bond may reach a monetary settlement agreement or have another contractor complete the work according to the original provisions
  • In some instances, there may be some unforeseen changes required to complete the work. A new bond is not required or additional “add-on” bond coverage is only necessary when the cost of the changes exceeds 20%.

Right-of-Way Permit Bonds in Maricopa County

MCDOT will always require bonds unless the work is being conducted by a public entity with a net worth that exceeds $1 million. For very small projects requiring temporary access a nominal $2,500 bond is sufficient.

Bond Requirements for Oversize or Overweight Permit in Maricopa County

In the interest of public safety, a special permit and bond may be required to move oversized or overweight loads on the roads in Maricopa County. Often these moving projects are required to be completed at night and a bond of at least $10,000 must be secured.

Arizona Agency Provides Permit Bonds

The Gebhardt Insurance Group is an established independent agency that offers a truly comprehensive group of products. Examples include insurance that protects homes, vehicles, and businesses and a variety of surety bonds. We look forward to speaking with you and encourage you to contact us at (520) 836-3244.

Commercial Performance Bonds in Casa Grande and Maricopa

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A surety bond is a contractual agreement that ensures a party’s commitment to properly satisfy a “debt, default, or failure.” There are three different parties involved in these agreements. The obligee may be a government agency or other owner of a project needing to be completed.

The principal in the agreement is the party that is committed to performing services or providing products such as a contractor. The surety is a state-approved entity that is protecting the owner of the project (obligee).

Contract vs Commercial Bonds

The National Association of Surety Bond Producers explains that the two categories of surety bonds are contract and commercial. Commercial bonds are also commonly referred to as miscellaneous bonds. Contract bonds are often associated with construction projects. A contractor may be required to secure a bond as a means of protecting the owner of a project if the contract is not satisfied. 

Commercial surety bonds may be a requirement according to state statute, local ordinance or another agency requirement. Individuals and businesses must secure a surety bond to remain compliant with these laws. They are most commonly issued for one-year but certain types extend for two years.

Types of Commercial Surety Bonds

  • License and permit bonds: Those who operate in certain professions may be required to obtain these types of bonds. Common examples include automobile dealers, mortgage brokers, and various specialty contractors.
  • Court (or judicial) bonds: Parties that are involved in judicial proceedings may secure bonds that protect other litigants or parties. They may or may not be required by law. Common examples include appeal bonds, guardianship, and attachment bonds.
  • Fiduciary (or probate) surety bonds: These may be required for those who are administering a trust that is subject to court oversight. A fiduciary is commonly also referred to as a trustee. A fiduciary role is associated with those in a position of trust that has some ethical or legal relationship with another party.
  • Public official bonds: Those who hold public office may have a bond requirement. They commonly apply to those serving as a treasurer or county clerk. This protection is afforded to the public if the official commits acts of wrongdoing.
  • Miscellaneous bonds: The term miscellaneous applies to surety bonds that do not fit into the primary categories. There are many types including fuel, warehouse, and utility bonds.

Performance Bonds

Construction projects generally require that contractors are prequalified before being deemed eligible. A performance bond provides the project owner with protection in the event of default or another failure to complete a project. Contractors may be assessed based on their financial standing and work history.

The project owner is placed in a risky position when a contractor fails to meet their obligations. The bond may be used to retain another contractor or otherwise provide critical financial resources to ensure the work is properly completed.

Bonds vs Insurance

Surety bonds are often incorrectly viewed as being a form of insurance. They are not insurance policies and will not protect a party from problems such as those involving construction liabilities. A surety bond is used to compensate for obligations specified on the bond. The requirements of the value of a bond may vary based on a host of factors.

For example, an Arizona contractor’s license bond amount is determined by estimating the volume of earnings for the coming year. The bond’s value may range from roughly $5,000 to nearly $100,000. Bond value and type vary in Arizona and differ in other states or for specific circumstances. In California, contractors are generally required to maintain a $12,500 bond.

In Washington State, the contractor is required to meet both surety bond and insurance requirements. To be an eligible contractor for Northern Arizona University, the requirements include commercial general and automobile liability insurance. This is in addition to worker’s compensation coverage and the surety bond(s) specified in the contract.

Agency Provider of Commercial Bonds in Arizona

The Gebhardt Insurance Group offers a truly comprehensive array of products for individuals, families, and businesses. This includes insurance for your home, life, and automobile and contract and commercial surety bonds. We now have offices in Casa Grande and Maricopa for the convenience of our customers. You are encouraged to contact us today to speak with one of our professionals.

Medicare Insurance Casa Grande and Maricopa

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The Centers for Medicare & Medicaid Services (CMS) is responsible for managing the Medicare program in the U.S. currently. It is a division of the Department of Health and Human Services (HHS). The budget estimates of HHS programs are approximately $1,120 billion in required funding with another $95 billion in “discretionary” spending. 

Millions of Americans rely on healthcare that is funded through Medicare and Medicaid, which is one reason why healthcare is the single largest part of the Federal Budget. As a result, new legislative measures and changes to the program occur continuously in efforts to reduce costs. In Arizona, roughly 1.2 million people are beneficiaries of Medicare. 

What is Medicare?

Medicare is a federal program that was established in 1965. It is a health insurance program for those ages 65 and over. It is also used by some people under the age of 65 that have certain diseases and disabilities. The program is divided into Parts A, B, C, and D. 

Part A is intended for inpatient care in hospitals, skilled nursing care, hospice, and home health care. 

Medicare Part B provides coverage for services from doctors, wellness care and other outpatient care. It is also used to pay for some medical equipment such as mobility devices and beds. Parts A and B are commonly referred to as Original Medicare. Medicare Part D is operated by private insurers according to Medicare-specific guidelines for prescription drug products.   

Those with Original Medicare may add various supplemental plans. Medicare Part C consists of alternative “bundled” plans commonly called Medicare Advantage. They generally have Part A, B, and D coverage included. They may also include additional benefits such as dental and hearing. 

Prescription Drugs in Arizona Medicare

Arizona residents that qualify for Medicare are generally eligible for Medicare Advantage and Medicare Prescription Plans. Medicare Part D coverage began in 2006 and is available from licensed insurers. Those using prescription plans should review them annually to see if they are still the best option for their needs. 

Those with employer-provided prescription plans may be eligible to continue with those that are considered “creditable.” When comparing prescription drug plans, a good starting point involves reviewing the plan’s covered drugs. This is referred to as the formulary. You will also want to consider the co-payment amount that must be paid “out-of-pocket” for prescriptions. 

Arizona Department of Economic Security (DES) and Medicare

The Arizona DES has two programs that are designed to assist the state’s Medicare beneficiaries. These plans are the State Health Insurance Program (SHIP) and the Senior Medicare Patrol (SMP). There are five classifications of plans in Arizona as follows:

  • Health Maintenance Organizations (HMOs): A group of medical providers including doctors and hospitals establishes set rates for Medicare patients. Patients generally must receive care from the providers participating in the HMO.
  • Preferred Provider Organizations (PPOs):  A form of managed care where services are provided by doctors and hospitals participating in a specific network. Patients who receive care from providers outside of this network will likely have additional costs.
  • Private Fee for Service (PFFS): A private insurance plan that accepts Medicare patients. The insurance plan dictates the prices paid for the medical services offered.
  • Medicare Saving Accounts (MSAs): A savings account is established exclusively to pay for medical expenses. Medicare allocates a certain amount to the account annually.  These accounts may have high-deductible plans with a $2,000 minimum.
  • Special Needs Plans (SNPs): A form of HMO designed for those who qualify for both Medicare and Medicaid. They also have chronic medical conditions or those need long-term medical assistance. 

Arizona Senior Medicare Patrol (SMP)

This is a group of professionals and volunteers that seek to assist Medicare patients by uncovering fraud and errors. Most states have these organizations. Some of their efforts include counseling and education. The agencies often identify illegal marketing practices and detect fraud such as ordering and billing Medicare for unnecessary tests or procedures.   

Original Medicare

Original Medicare typically includes Part A and Part B only.  Some individuals, including those with employer-provided insurance plans, may elect not to participate in Part B. 

Original Medicare does not typically cover dental, vision or hearing-related services. The program tends to have higher “out-of-pocket” expenses such as copayments and deductibles. 

Medicare Advantage

Usually this “Part C” includes A, B, and D. It provides coverage for a wider range of services compared to Original Medicare and tends to have lower “out-of-pocket” costs. The plans involve contracts between private companies with Medicare.

What are Medigap Policies?

“Medigap” policies are considered to be Medicare supplement plans. They are offered by private companies. Some of the gaps that these plans cover include deductibles and copayments. These differ from Advantage plans because they are separate and require that you still maintain an Original Medicare plan. 

Medigap policies do not cover long-term care coverage, dental, hearing or vision. Since 2006, they also became unable to offer prescription drug coverage. Spouses must purchase Medigap policies separately. 

Independent Insurance Agency in Arizona

The Gebhardt Insurance Group is an experienced team of professionals. We have office locations in Casa Grande and Maricopa. We currently represent dozens of the leading insurers.  Contact us six days a week at (520) 836-3244 for cost-effective insurance solutions and exceptional customer service and support.

Contract Surety

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Contract Surety

Similar to an insurance policy, a surety bond is a commitment to satisfy a “debt, default, or failure” of another party. There are three parties involved in these agreements. The obligee is the party that is having some type of project completed and is often a governmental entity. The principal is the contractor or another service provider that will be performing the work. The surety is the third-party that is insuring or assuming financial liability to protect the project owner (obligee).

There are two general types of surety bonds. These include contract surety bonds and commercial or miscellaneous surety bonds. As the name implies, a contract bond is based on a formal agreement or contract. Commercial bonds are typically required according to legal statutes. Types of commercial bonds include permit or license bonds that are required by law in a given jurisdiction.

Contract Surety Bonds

A contract surety bond applies to most construction projects. The contractor purchases a bond from a surety company. If the contractor does not fulfill their obligations, the surety company will provide the compensation necessary to the project owner. Contract surety bonds may be classified as bid, performance, payment, or warranty bonds.

Bid Bond

Contractors that wish to bid on a contract may be required to complete a bond form and secure a bid bond. These are issued to protect the project owner in case the contractor who was awarded the contract does not follow through. The surety company will evaluate the credibility of a contractor, which may “screen out” bidders who are not qualified. A surety company will only issue a bid bond to those they deem as reputable and qualified.

Performance Bond

A performance bond protects the project owner if the contractor does not properly complete a project. It also applies if there is a failure to adhere to the contract’s details and specifications. The Arizona Revised Statutes state that bonds must be issued by a “surety company or companies holding a certificate of authority” in Arizona. The amount of a performance bond is based on the full value of the contract.

Payment Bond

A payment bond is usually issued in conjunction with a performance bond. Payment bonds are issued by a bonding company to ensure that the project is completed without any liens. Any suppliers of materials or subcontracted providers may be compensated by a payment bond if they are not paid. A “payment only” bond is rarely issued.

Warranty Bond

A warranty bond is sometimes referred to as a maintenance bond. These are issued for the protection of the project owner in case it is determined that poor workmanship or defective materials were used. This applies for the term of the defined warranty period where the warranty bond is viewed as collateral.

Arizona Contractor License Bonds

The State of Arizona Registrar of Contractors has a requirement that all contractors have a bond as part of licensing. The amount required varies based on the specific trade license classification and their estimated volume of work. This requirement allows for either a surety bond or the contractor to make a cash deposit bond. For a residential contractor, an additional bond or deposit amount of $200,000 is required for a state recovery fund.

Surety Bond Provisions in Arizona

Arizona law specifies that bond requirements are met before executing any contract for “construction, alteration, or repair” of the following: 

  • Public buildings or structures
  • Public works or improvements for any county, city, or town
  • Projects involving drainage, irrigation, flooding, electric, power, and more
  • Any “tax levying” improvements in a district 

Agency Provides Contract Surety Bonds in Arizona 

The Gebhardt Insurance Group in Casa Grande is an established independent agency that has been serving the region for many years. Our team of professionals effectively determines the specific needs regarding bonds and insurance to protect individuals, families, and businesses. Contact our office today by calling (520) 836-3244.

Miscellaneous Surety in Arizona

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Miscellaneous Surety

What are miscellaneous surety bonds? The term miscellaneous refers to something that is diverse or having various traits.

Surety bonds are defined by the National Association of Surety Bond Producers as a “promise to be liable for the debt, default, or failure” of another party. This involves a third-party that contracts to guarantee that a party will satisfy an obligation. Three parties exist in a surety bond agreement.

  • Principal: This is the party that is required to obtain a bond. It is generally a business or individual that acquires a surety bond as a way to qualify to conduct business with an obligee.
  • Obligee: The obligee is the party that has implemented a requirement that any potential principal makes this pledge or guarantee. 
  • Surety Company: This is the party that is assuming responsibility for the performance of the principal. A surety company is a recognized entity that has satisfied requirements to function in this role within a jurisdiction. 

Two General Categories of Surety Bonds

Contract bonds are contractor license bonds or bid bonds required to be eligible for construction projects. This bond is used for financial compensation in case the contractor fails to complete the project or to complete it properly. Bond funds may also be used in case of default to compensate material suppliers or subcontractors.

Commercial surety bonds are the type that include miscellaneous surety bonds. These bonds are often required by government statute, ordinance, or other provisions. Commercial surety bonds are generally classified among the following five categories.

  • License and permit bonds apply to many different professions or industries as business service bonds. Examples may include automobile dealers, mortgage brokers, and more.
  • Court bonds or judicial bonds may be a requirement for parties in judicial matters. Examples may include injunction bonds, appeal bonds, and more.
  • Fiduciary or probate bonds may be required for those who are assigned or appointed to represent a trust or estate. Examples may include trustee bonds and executor bonds.
  • Public official bonds are often a statutory requirement that acts as a protection for the public. They may apply if a government official commits wrongful actions. Examples may include treasurer bonds, notary bonds, and more.
  • Miscellaneous bonds are any type of bonds that do not fit under the other four classifications. Examples may include fuel tax bonds, utility bonds, and more. 

Miscellaneous Surety Bonds

Bonds that do not have similar characteristics are categorized as miscellaneous. These are a form of commercial bonds. Examples may include warehouse bonds, title bonds, Airlines Reporting bonds, union wage and welfare bonds, and more. Those who operate in this realm are generally regulated by the same state agency that oversees the insurance market.

What is a Surety Bonding Company?

Surety bonds are commonly issued by affiliates or designated divisions of insurance companies or financial product providers. These entities will typically need to satisfy eligibility requirements that demonstrate financial strength. There are some similarities between surety bonds and traditional insurance products. One critical difference is that surety bonds are agreements between three parties instead of two.

Companies that issue surety bonds underwrite their bonds similarly to lenders and insurers.  A surety may evaluate a contractor’s credit history, assets, and overall character. These are variables used in determining whether a party is likely to satisfy their obligations. The surety companies use contracts called general agreements of indemnity for their protection before issuing bonds.

Surety Bonds for Telecommunications Licensing in the City of Phoenix

These are local bonds license and permit bonds that specifically apply to telecommunication providers in the City of Phoenix. New licensees must establish a $100,000 bond during the implementation phase. This requirement is later reduced to $50,000 for the duration of the lease. In addition to bond guarantees, licensees may be required to keep $40,000 in a qualifying account to further secure their obligations.

Surety Bonds for the Administration of Probate and Wills in Arizona

These are the types of bonds required by the state for personal representatives to an estate.  This requirement is waived if specified in the will. A bond is not required for representatives of a “national banking association” or those with a bank permit. This also applies to a title insurance company or certified trust business representatives.

Parties with an interest in an estate may petition for a bond. Courts may require bonds if they have “reasonable proof” that the estate administrator may be placing the petitioner at risk. The same applies to a trustee. A bond may be put in place to “secure the performance of the trustee’s duty.”

When the terms of a will do not specify the bond amount, a “best estimate” may be made. This may involve a need for appraisals to be made for assets such as real estate. The amount of the bond may be lowered if estate assets are placed into a secured account approved by the court.

Arizona IFTA Bonds

The Arizona Department of Transportation may require a bond that ensures a supplier of fuel will pay all applicable taxes. This bond is called an International Fuel Tax Agreement (IFTA) that protects the state. The rate may be up to a maximum of 15%, which is based on the credit history of the applicant.

Commercial Utility Agreement Bonds

The City of Mesa requires that commercial entities maintain a surety bond for utilities in addition to a commercial security deposit. The amount required is based on city estimates that equal 2.5 times the company’s maximum monthly billings. This requirement may be evaluated and potentially eliminated after thirty-six months. To qualify, their payment history must show all payments have been made promptly.

Independent Agency for Business Insurance and Surety Bonds in Arizona

The Gebhardt Insurance Group is an established insurance agency that works with individuals, families, and businesses to create customized insurance solutions. Our team of experienced professionals will identify the specific types of coverage you need. As an independent agency, we can compare options from dozens of carriers to find the best overall value. We look forward to speaking with you. Contact our office today at (520) 836-3244!

Energy Surety

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Energy Surety

A surety bond is similar to an insurance policy. These are agreements to satisfy a “debt, default, or failure” of a party in case they do not fulfill their commitments. The parties involved in these bonds include the obligee, principal, and surety. Principals are those that must secure a surety bond. This may be a requirement to be eligible for a project, become licensed, or to qualify for another benefit. 

The obligee is the party that has implemented a requirement for a surety bond. The surety is a third-party that is entering into an agreement to assume the financial liability on behalf of the principal. Often, sureties are available from designated branches of insurance companies and similarly are often sold through brokers or agents.

Energy Utility Bonds 

The energy and utility markets are generally in strong demand for services. Energy utility surety bonds may be required for the financial protection of those operating in this sector. The principal in this arrangement is often a large buyer (consumer) of energy. The utility provider may require a bond in case the buyer is unable to make their ongoing payment obligations.

Examples of large consumers of energy may include manufacturing companies or other types of corporate entities. Utility service providers often use discretion when providing energy for larger consumers. The surety bond may be a requirement before the utility is accessible to the principal’s property.

Those who issue surety bonds also use discretion when deciding whether to issue a bond. For example, businesses with a history of defaulting generally must pay higher premiums for coverage or they may be denied. The premium amount that the principal must pay is based on the necessary total bond amount. This is based on the estimated potential liability involved and other factors.

Energy Contract Performance Bonds

Energy contract performance bonds may be a requirement of a state or federal agency.  These commonly include those responsible for environmental compliance. Those required to secure energy performance bonds may include those actively drilling into the earth to locate oil sources or implementing solar energy grids.

These bonds may be required for those responsible for plugging wells or developing wind energy sites. The financial protection of a bond may be needed if a problem develops, such as an environmental disaster.

Energy Broker Bonds

Energy deregulation within the U.S. continues to expand. Energy brokers function as sellers between those involved in the production and the consumer. The government typically requires energy brokers to obtain surety bonds. These bonds are used as a financial guarantee to protect the general public from potential failures, which adheres to regulatory requirements.

Broker bonds are not unique to the energy industry. Traditionally, surety bonds are also a requirement for those acting as freight brokers and more. 

Established Arizona Agency Provides Surety Bonds

The Gebhardt Insurance Group, based in Casa Grande, has proudly been serving clients in the region for many years now. As an independent agency, we can offer products such as insurance and surety bonds from various carriers. Contact us today at (520) 836-3244.

Commercial Surety in Arizona

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Commercial Surety

A surety bond is a contract that is made between an obligee, surety, and principal. Bonds are established for the financial protection of a party in case the principal fails to satisfy an obligation. A surety is another party that pledges to assume this responsibility. Experienced insurance agents or other professionals can best assist you with buying surety bonds.

Understanding Surety Bonds

The National Association of Surety Bond Producers (NASBP) defines a surety bond as a “promise to be liable for a debt, default, or failure” of another party. The obligee is the party that establishes the bond requirement. The surety is the third-party that is assuming financial responsibility for the principal. The two general categories of these agreements include contract and commercial (miscellaneous) surety bonds.

Contract Bonds

A contract bond is also commonly referred to as a construction bond. These ensure a contractor will satisfy their obligations for a project, such as completing the work according to the specifications. This type of bond may serve to ensure subcontractors or those who supply materials are paid.

In Arizona, surety bonds of this type are referred to as “bid bonds” or “performance bonds.” Contractors who wish to bid or make a proposal to complete a government project will need to meet certain requirements. The State of Arizona’s Procurement Code outlines these provisions under Bid Security. They require contractors to obtain a bond from a surety company “holding a certificate of authority” to conduct business in Arizona.

Commercial Surety Bonds

A commercial bond or “business bond” ensures protection for businesses. These bonds may be required by government entities at any level. Many of these bonds are specific to an industry or occupation. The following are some of the most common categories.

  • License and permit bonds: These are typically a requirement for licensing such as by a state agency. Examples include bonds for automobile dealers and mortgage brokers.
  • Judicial bonds: These may also be referred to as court bonds. They may be required by any party involved in judicial proceedings. Some examples include injunction bonds and appeal bonds.
  • Fiduciary bonds: A fiduciary is a party that assumes a duty to handle the financial affairs of another individual or entity. This may apply in probate such as when a party is responsible for the administration of a trust. They are often referred to as trustee bonds or executor bonds.
  • Public official bonds: These may be needed for compliance with statutory requirements. The bond may serve to protect the public in case a public official was to commit acts of wrongdoing.
  • Miscellaneous: There are dozens of other types of bonds. Some examples include fuel tax bonds, utility bonds, and more. 

Arizona Surety Bond Cash Deposits (§ 32-1152(D))

In Arizona, the state allows contractors to make cash deposits in place of bonds. These funds are held by the state treasury. The deposit may not be withdrawn until two years after the “termination of the license in connection” with the bond requirement. This two-year requirement also applies when using a “commercial surety bond as a replacement” to an existing cash deposit.

Established Provider of Commercial Insurance and Bonds for Arizona Businesses

The Gebhardt Insurance Group has been providing solutions for the business community here in Arizona for many years. Our agency professionals can review many options for you to find a custom solution while offering excellent protection at a great value. Contact our office today at (520) 836-3244 for more information.

Best Car Insurance Deals

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Car Insurance Deals

Why is it important to shop and compare various deals available for your car insurance? One reason is that car insurance rates risen significantly. In the United States, premiums have risen by an estimated 23% since 2011. This rise stems from factors such as higher costs of repairing vehicles involved in a car accident and an increase in distracted driving accidents.

U.S. Auto Insurance2015201620172018
% Annual Increase4.2%6.9%5.0%2.3%

Finding Affordable Car Insurance

Car insurance is a required expense for all drivers. It is important to protect you in case your car is damaged, you are involved in an accident, or you your car is stolen. You want to find coverage that provides adequate coverage.

In this post, we will discuss some terms to know and trends to understand as you look for auto insurance and provide some of the best car insurance deals.

Ways to Find Great Deals

There are various ways to shop and compare your car insurance options. You may directly visit insurance company websites or call them to obtain a price quote. One uncommon approach is one you have probably seen in ads from Progressive: they show the rates of their competitors when you obtain a quote.

Shopping directly through the insurance company’s website can be time-consuming, as the process of visiting multiple sites or calling them and repeatedly entering or providing your information is redundant. When you shop directly through the insurer, they will likely have various policies for you to consider. The drawback is that the presented options are all from that carrier.

Shopping Through a Captive Insurance Agent

Many large national auto insurance companies sell their policies through captive agents. These are professional, local agents that may offer various types of insurance, but only represent one carrier.

Many people choose a captive insurance agent because they prefer personal service and support from a local agent. The drawback with a captive agent is they are unable to shop multiple carriers to find you the best rate.

Finding Deals Using Comparison Sites

There are various websites such as QuoteWizard that specialize in comparing options from multiple insurers in your area. Many shoppers find these sites to be an efficient way to shop. Oftentimes, these sites only represent the large national carriers, limiting your ability to consider policies from many local or regional insurers.

The Minimum Coverage Requirements in Arizona

All Arizona motorists are required to maintain the state minimum levels of liability coverage. This does apply to those operating a motorcycle, moped, and even a golf cart. The mandatory insurance requirement, which is often abbreviated as “15/30/10,” is as follows:

  • Bodily injury insurance coverage of $15,000 per person
  • Bodily injury insurance coverage of $30,000 per accident involving multiple people
  • Property damage liability coverage of $10,000 

Bodily injury liability insurance is used when you are found to be responsible for causing an accident that injures someone else. The property damage coverage applies when you are responsible for causing an accident that damages someone else’s car or other property. It is important to recognize that liability insurance does not pay for your injuries or damage to your vehicle.

Recently passed legislation will raise the required minimum levels of liability insurance in Arizona. This is the first increase in decades and it will take effect in July of 2020. The new minimums will be as follows: bodily injury insurance of $25,000 per person and $50,000 per accident. The property damage liability coverage minimum is increasing to $15,000.

Collision Insurance

This type of coverage will pay for repairs or replacement of your vehicle when in an accident. If you cause an accident, your liability coverage covers injuries and property damages that other motorists incur. Meanwhile, your collision coverage would be used for your vehicle repairs. Collision coverage is also for situations such as a collision with a pole or tree.

Rising Costs of Collision Insurance

The cost of the average brand new car today exceeds $37,000. This potential replacement cost significantly increases the cost of insurance coverage because the insurer knows that if the vehicle were totaled, they would be paying upwards of $30,000 to replace it. Aside from the overall replacement cost, the price of repairing a newer vehicle involved in a collision is higher than an older vehicle.

Data from the U.S. Bureau of Labor Statistics indicates that vehicle repair costs rose by more than 61% between 2000 and 2017. The way that car manufacturers are building newer vehicles contributes to the increase in repair costs.

The days when cars had a sturdy steel bumper on the front and rear are gone. Instead, the body panel materials tend to be some form of lighter-weight, composite material. After a moderate collision, these exterior body materials generally need replacement rather than repairs.

Newer vehicles today also contain sensors, cameras, and other safety features that are integrated into the exterior body. For example, regulators now require that all new vehicles have a rear backup camera. If these vehicles are in a rear-end collision, the repairs will likely involve replacing these electronic systems in addition to the body panel.

Insurers deem a vehicle that is involved in a collision to be “totaled” when the repair costs plus the scrap value exceed the current value of the vehicle.

Comprehensive Insurance

Comprehensive coverage is similar to collision because it is used to repair or replace your vehicle. The difference is that this coverage applies when the damage is incurred in some way that does not involve a collision while operating. For example, comprehensive coverage is used to replace your vehicle if it were stolen. Keep in mind that certain types of vehicles are more likely to be stolen and insurers adjust their rates accordingly.

Other examples of when comprehensive coverage would apply include hail damage or vandalism. Those who have auto loans are required by the lender to maintain full insurance coverage for their protection. The financial institution that you are making payments to is using the vehicle as collateral if you default on the loan.

Are You Shopping for “Full” Coverage Insurance?

Those with a car of moderate value will generally obtain “full” coverage insurance. This term refers to having at least liability, collision, and comprehensive policies.

Those with a vehicle that is only worth a couple of thousand dollars may consider maintaining only liability insurance coverage. Lenders require full coverage in the event that something happens to the vehicle, so you have to have paid off your loans in full to decline comprehensive coverage.

How Deductibles Impact Insurance Costs

If you are comparing potential auto insurance options, it is important to consider the deductible amount. A deductible is the amount that the insured party must pay “out of pocket” when an insurance claim is made. The auto insurance deductible applies to your comprehensive and collision coverage.

Failing to consider the deductible amount would result in an inability to do an “apples to apples” comparison, as common deductible amounts range from $500 to $2,500. Those seeking to save money on the cost of their insurance premiums may choose a higher deductible amount.

We will consider the following example to illustrate how this works. You are driving a car valued at $10,000 and have a $1,000 insurance deductible. When your insurer deems your car totaled after an accident that results in tremendous damage, you must pay the $1,000 deductible amount and then your insurer will pay the remaining $9,000.

Uninsured and Underinsured Motorist Coverage

Uninsured motorist coverage is used to repair or replace your vehicle if involved in an accident with a motorist without liability insurance. This coverage may apply if you were involved in an accident with a “hit-and-run” driver that flees the scene.

Underinsured coverage commonly occurs if you are involved in an accident with a motorist who has state-minimum liability insurance coverage. If the other motorist is determined to be responsible for the accident, you will file a claim with their insurer. Underinsured coverage will pay any amount necessary to repair or replace your vehicle beyond the limits of their liability coverage.

What Factors Do Insurers Consider to Calculate Rates?

  • Demographics: Insurers use data such as your age, gender, and marital status to determine their rates. For example, teenage males pay among the highest premiums based on their lack of driving experience and potential for risky behavior. 
  • Location: Your zip code provides insurers with insight into whether you are likely to be driving in urban or rural areas. They also may consider the rates of automobile theft in your area for calculating comprehensive coverage premiums.
  • Credit: Data suggests that those with a poor credit history are more likely to file an insurance claim, so insurers would raise their premiums. 
  • Claims history: There is a central database called CLUE that contains any insurance claims individuals has filed in the prior seven years. Insurers generally consider a driver’s history of insurance claims as an indicator of their likelihood to have future claims. Similar to your credit report, consumers are eligible to receive one copy for review each year.
  • Your vehicle: Insurance companies may consider that those driving high-performance or sports cars as more likely to drive recklessly. The value of your specific vehicle is critical to insurers, as they may potentially have to pay to replace higher-priced vehicles. Certain models are also most likely to be stolen; often this results from known security flaws that thieves are aware of.

Most Common Car Insurance Discounts Offered

Those who are members of certain organizations may be eligible for discounts. Examples include those who are employees of a certain company, active military members, or those in certain professional organizations.

Insurance companies typically will offer discounts for those who “bundle” multiple types of insurance. For example, if you purchase both your auto insurance and home insurance from the same company, the premiums for both will be slightly less expensive than they would be otherwise.

Some insurers may offer loyalty discounts. An example would be for young drivers that are added to their parent’s existing auto insurance policy. “Safe driver” discounts, such as offered by Liberty Mutual, may be available for those with an excellent driving record.

Best Car Insurance Deals Available from Insurers in Arizona

Here are some examples of current special offers that are available for Arizona motorists that qualify.

  • Progressive: They are offering a 10% discount on car insurance for those who also purchase home insurance. 
  • Foremost: The company is promoting discounts for those who will be switching from another insurer
  • Travelers: Those who have no accidents, traffic violations, or insurance claims for the past three years may save 10%
  • Safeco: Recent promotions include a Low Mileage Discount for those who drive less than 8,000 miles per year.

Usage-Based Insurance Deals

Car insurance companies such as Progressive are now offering auto insurance that is often referred to as being “usage-based.” The company may have some type of application or device that tracks your driving habits for a period of time. Progressive’s Snapshot Program is one popular example. The company claims that many drivers can save $130 annually on premiums.

Shopping for Insurance Deals With a Local Independent Agent

Consumers who are exploring their options for car insurance should consider a local independent agency. Unlike a captive agent that exclusively represents a single carrier, an independent agent can consider options from multiple insurers. They will shop on your behalf to find a competitively priced policy that is suited for your specific needs.

Established Automobile Insurance Provider in Pinal County

The Gebhardt Insurance Group began operations in 2005 in Casa Grande. Over the years, we have witnessed the population of the county nearly double in size. We are proud to offer affordable insurance products from the leading carriers and excellent customer service. We encourage you to contact our team of professionals today at (520) 836-3244.

Life Insurance as an Investment Tool

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Life Insurance

What is life insurance? It is an insurance contract that is established between the policyholder and the insurer that will pay a benefit upon death. There are various types of life insurance products on the market today. One type of life insurance is called permanent life insurance. Permanent life insurance pays a death benefit to the named beneficiaries and can be a great investment. 

Facts Regarding Life Insurance

According to a study by LIMRA titled “Life Insurance Ownership in Focus” more than 87 million Americans have a life insurance policy. The number of Americans that have life insurance is trending upward; however, the average amount of coverage has decreased. Approximately 70% of U.S. households have life insurance.

The Difference Between Term and Permanent Life Insurance

Term life insurance is much simpler than permanent or whole life insurance policies. The buyer agrees to make premium payments for a specific term or period. These policies are commonly purchased for terms of 10, 20, or 30 years. Term policies are fairly affordable and are most popular among households that have dependent children.

Term policies pay a specified death benefit if the insured party dies during the term of the policy. Buyers often choose a term based on when certain milestones are likely to occur. For example, parents may choose a term policy that extends to the estimated time their children will be graduating from college. A term policy can be very important so that dependent loved ones have financial support if you pass away.

A permanent life insurance policy also pays an amount to the beneficiary when the insured party dies. There is no other defined term or length for a permanent life policy. A whole life policy typically has a fixed premium amount. These types of policies often contain clauses preventing an insurer from revoking or otherwise terminating the policy unless premiums go unpaid.

Permanent life policies also have a savings component that builds cash value that the policyholder may borrow or withdraw from. As funds accumulate, they are invested in a tax-protected account. The investment portion of the policy may be subject to stock market fluctuations and the invested funds may generate dividends. Common types of permanent life policies include variable and universal life insurance.

Why Purchase Permanent Life Insurance?

Each consumer has a unique set of individual circumstances. Life insurance policies are fortunately not a “one size fits all” product. Many lower-income individuals immediately recognize that permanent policy premiums are beyond their financial means. These policies tend to be more expensive than term policies.

It is critical that consumers considering a whole life policy are prepared to maintain it. Those with a need for a life policy that exceeds 30 years often find it difficult to find a term policy. Those with a considerably younger spouse who want to ensure that they will have financial support should seek a permanent life policy. Children with permanent disabilities should also be considered when choosing a life insurance policy.

Variable Life Insurance

Variable life is a type of permanent life policy where the cash value and death benefit fluctuate based on the performance of invested funds. When the investments perform well, the earnings may be used to pay premiums or added to the death benefit amount. Variable policies may or may not have a guaranteed return rate. Keep in mind that the cash value may decline in years where investments perform poorly.

Universal Life Insurance

A universal life policy is a type of permanent policy that invests funds. The key aspect that differentiates universal policies is that they generally have a fixed rate of interest. The policies are quite flexible. The policyholder may choose to skip premium payments as long as the minimum required premium is paid during that year. Policyholder’s may have the option to tailor the amount of premium allocated toward the death benefit or cash value.

Indexed Universal Life Insurance

An indexed universal life policy allows the policyholder to maintain cash value in a “fixed account or equity index account.” The investment component is considered to be less risky than variable universal policies. The policyholder can typically pay a premium between a set minimum and maximum range. The cash value of the policy is usually accessible at any time without penalties.

Tax Benefits of Permanent Life Insurance

  • The cash value of a policy will increase tax-deferred as a retirement account would.
  • Withdraws from the cash value will usually be tax-free up to the amount you have already paid in premiums.
  • Life insurance policy beneficiaries can receive the death benefit without having to pay taxes.
  • Life insurance policy premiums are typically paid with “after-tax” dollars. 

Medical Examination Requirements

A life insurance company often will have applicants undergo a medical examination performed by a professional. You may be asked to complete a questionnaire. A full medical exam may include taking blood or urine samples and other various tests. This is part of the underwriting process that insurers complete when issuing policies.

There are “guaranteed acceptance” life policies available in the market as well. The premiums tend to be comparatively expensive and the death benefit may be restricted to a low amount. These policies are often viewed as being a poor overall value except for those with serious medical conditions.

Policy Waiting Periods

Some policies may have a waiting period. This is an amount of time that must elapse before the policyholder is eligible for the full benefits of coverage. These are commonly referred to as “elimination periods” or “qualification periods” during which you are paying premiums. For example, consider a policy with a two-year waiting period. If the policyholder dies during that time they may only be able to recover the amount already paid in premiums.

Comparing Life Insurance to Other Types of Investments

A permanent life policy is not the best option to choose exclusively for investment purposes. Although there are clear tax advantages, life insurance does not offer an employer match like a 401(k) or other retirement accounts. Those who qualify for Roth IRA’s may find these to be a superior option for investment purposes. It is recommended that you always consult a financial advisor or other professional.

Advantages to Purchasing Insurance Through an Independent Agency

If you have shopped around for insurance recently you have likely encountered an overwhelming number of options. Trying to compare policy options can be time-consuming. Unlike a captive insurance agent, an independent agent can offer policies from various insurance companies. These professionals are positioned to efficiently evaluate and identify the best options for your unique set of circumstances and goals.

Independent Agency Provides Life Insurance in Casa Grande

The Gebhardt Insurance Group is a well-established provider of insurance solutions and is locally based. We can help you save money on insuring your home, vehicles, business, and much more. Contact our team of professionals today at (520) 836-3244.