CAQH Credentialing – The Why and How of CAQH Credentialing for Medical Providers
January 20, 2012 | 
Author 
Many insurance carriers are requesting or requiring CAQH credentialing as a way to join or recredential with their provider network. What is a CAQH application, what information is needed to complete the application, how long does it take and how do I apply are a few of the questions that arise.
In the past in order for a provider to participate with an insurance carrier he or she would ask for and be sent a provider application packet. Each application was different than the next. If you wanted to participate with 12 insurance companies, you might have to complete 12 credentialing applications.
The CAQH credentialing process was designed to provide a universal credentialing system for medical service providers who wish to join an insurance company’s network. CAQH is a non profit organization formed to simplify healthcare administration. By completing the CAQH application, a provider now has his or her information available for an insurance company to check online for credentialing purposes.
The CAQH application is quite lengthy and involved but it will in time become necessary as we saw with the NPI numbers. Many companies are now requiring a completed CAQH application for both credentialing and re-credentialing and no longer offer an application of their own. We offer a service of actually doing the CAQH application for providers. You can get more information on help with your CAQH application at our website link below.
The CAQH credentialing process works well for new providers just starting in practice. They can apply to many insurance companies by completing only one application. They then would contact the insurance companies they were interested in and the insurance company can access the provider’s information online at a secure site.
The information required to complete the application consists of name, address, practice location, tax id#, npi #, schooling, malpractice insurance, references, hospital affiliations, and much more.
The application can be completed online or you can request a hard copy be mailed to you. A printed copy would be completed and returned to CAQH. When working on an online application it is not necessary to complete it in one setting. You create a login name and password so you can return later.
Upon completion the applications undergo an audit to make sure all the necessary information is complete. Supporting documentation must then be faxed to a secure database. You are then notified by email or fax that your application is complete.
Once your application is complete, participating health plans and hospitals that you designated during the application will be automatically notified that your application is available for them to view.
For help with the CAQH credentialing process, check out our website Solutions Medical Billing
Coryright 2007 – Alice Scott
How To Pick The Best Home Insurance Company
Home insurance is a must, but there are a lot of options to choose from, just like in auto insurance. There are four main categories in home insurance: Structure of the house, personal assets, liability, and off-premises living expenses.
House Structure Coverage
Coverage for the structure of your home should anything happen is a must, but it is up to you how well covered you want to be. There is an option called extended-replacement value coverage which will replace your actual house 100% as opposed to a much lower percentage. Plus, an additional percentage is added for the event that the house would have to be re-built to help defray the costs of the current housing market prices. If you decide not to get the extended-replacement option, it is especially important that you take into account inflation in the housing market each time you renew your coverage amount, and any remodeling improvements you make to the house should be taken into account also when renewing coverage amounts.
Personal Assets Coverage
There is also an extended-replacement value coverage option for your assets as well. Basically, your assets can be defined as anything in the house that is non structural. Many people grossly underestimate what everything in their house would cost if it all had to be replaced. Therefore, it is suggested as good advice to literally take an inventory of everything in your house to get at least a rough estimate of what the cost would be to replace it all. If you had to replace it all, keep in mind however, that it would all be replaced with the new versions of what you currently own. Therefore, the cost to replace everything would be (most likely) much greater than their present worth. Also, be sure to know the time-frame for replacing your items, if any. And, when they would actually help pay, before or after the fact? Many insurance companies prefer to reimburse receipts as opposed to giving the money upfront. Would that work for you in a worst case scenario? Something to make note of when choosing insurance companies.
Floaters (also known as endorsements)
Floaters can be thought of as a way of floating more coverage over to your more valuable items. Coverage amounts are meant for insuring basic household items and so therefore, will be insufficient as a means for extravagant coverage on a particular item(s). That is when floaters come into play. You can purchase floater insurance for those items that are extremely valuable in price for sufficient coverage if anything should happen to them, even if they are lost.
Liability Coverage
Obviously, the more coverage you have for liability, the better. Liability costs has the potential to be more than anyone’s wildest imagination, and therefore, the better protected you are, the better off you will be should a worst case scenario occur. Liability coverage will cover you for damage done to others and their property, which can get very expensive, especially if they take you to court. It will also, therefore, pay the court fees and whatever the judge makes you dish out at the end of the day for damage costs. If you have pets that like to get out and cause damage, beware! You may want to up your liability coverage even more!
Coverage For Off-Premises Living
If a natural disaster causes your home to be unlivable for a while, you would have to live and eat elsewhere for who knows how long. Coverage for off-premises living would cover basic living costs during the time that you are unable to live in your own home. This is especially important to have if you live in a high risk area for natural disasters to occur. Make sure you know which natural disasters your insurance covers you for! Don’t assume it will be for all and any that occur. For example, most insurance companies do not cover for floods and earthquakes by default. You must pay extra coverage for them specifically if you want coverage for it.
Know What Your Coverages Contain
Coverages for each insurance company will be similar but the details will be different. For example, if you lose your purse at the store (that contained a lot of money) and you were unable to retrieve it, would your insurance cover it under your personal assets? A lot of homeowners insurance companies would because they cover all your assets, whether you keep them hidden or take them out with you, they are usually covered just the same. Many people horribly underestimate what their homeowners insurance company can and will do for them. So, it is good to know the details of the coverages as well as what they cover. What is the list of natural disasters? If a tree fell through your roof would you have coverage for that? Also, what is defined as “your house-structure”? If your unattached garage burned down to a stubble would you have coverage for that? The more you know about your coverages the better.
How Can I Save On My Homeowners Insurance?
Just like with auto insurance, the higher your deductible is (the amount you must pay before your insurance will help out), the lower your premiums will be (your monthly payment), which can save you a bundle of money. So, the highest amount you are willing to pay out of pocket for if anything happens should be your deductible. And, if you use a homeowners insurance company that also covers your auto insurance as well, chances are you will get the bulk, discounted rate.
Meeting Safety Standards
Fixing up the house to meet insurance standards will also decrease your monthly payments with most insurers. It is a good idea to have their check-off list, such as the certain kinds of alarms and locks needed. Sometimes even a housekeeper living with you can decrease your rates since that can be looked upon as a very good alarm system also!
Anything that poses as a hazard in the home will increase your rates, so to get rid of the hazardous stuff will really help with lowering rates. For example, smoking is a fire hazard (over 23,000 reported house fires a year come from smoking), the fenceless pool is a liability hazard, and the pet that scares the inspectors of your home will surely be the cause of higher rates as well.
Land
Unless you are worried that the very land your house sits on will be pulled out from under you like a big rug, leaving you with nothing but a hole in space, you probably don’t need to insure it. However, insurance companies usually add your land into the value of your home by default. If you subtract the value of your land from the value of your house and just cover for that, then your rates will be less because there will be less expense to cover.
How Can I Make Sure An Insurance Company Is Good?
Believe it or not, there were homeowner insurances that tried to refuse payment to those insured when Katrina hit. Knowing the history of handled claims is a good indicator of how good a company is. Ratings online can be checked, which indicates how well they pay their claims. You can compare quotes online at http://www.foxquotes.com
Car Total Loss – Determining And Settling The Value Of Your Car!
What is the car total loss process? Once you are in an
accident, the insurance company must inspect the vehicle and determine whether
the damage was substantial enough to declare a complete loss.
Most insurance companies will want to inspect the vehicles
themselves. In most accidents, insurance companies have approved body shops
write estimates and they eventually issue payment based on that estimate.
However, when there is a potential for a car total loss, most insurance
companies want their insurance adjuster to inspect the vehicle.
The reason for this is the conflict of interest that arises
from the arrangement between the insurance company and the body shop. Body shops
are in the business of fixing cars. They have a vested interest in quoting the
repairs so the car can be fixed and not declare it a car total loss.
For all practical purposes this means that you will be
waiting longer. Usually it takes two to three business days for the body shop to
issue a repair estimate. If the claim adjuster or the field representative has
to inspect and write their own estimate, then you will be waiting three to five
more days to get to the location of your car.
Before the adjuster comes out, she/he will submit all
pertinent information about your car (year, make, model, and mileage) to a third
party company. This company usually is CCC
Information Services Group, Inc. CCC will do a preliminary report to
determine what the value of your car is so the adjuster knows what the insurance
company would be looking to if there is a total loss.
Depending on your state law and the specific insurance
company, there will be a car total loss when the insurance company believes that
the cost to fix the car reaches 70%, 80%, or even 90% of its total value. It is
always a good idea to ask the adjuster what is the threshold they use to
determine a total loss.
When the vehicle is being estimated by the car total loss
adjuster, this individual will be looking at the condition of the vehicle. They
will note how “clean” the vehicle is, what is the exact mileage, and what
equipment and options the car has. All of this information will be reflected in
the final evaluation of the vehicle.
The adjuster will then submit the inspection report again
to CCC. CCC will send a final report showing comparative prices for the vehicles
in your local market. They will establish what the fair market value of the car
is and what a fair offer of settlement would be. For more information on how to
dispute this report visit:
http://www.auto-insurance-claim-advice.com/car-total-loss-2.html.
Next, the adjuster must determine who the lien holder of
the vehicle is. If you have a car loan, the insurance adjuster must get that
information so they can contact the bank to determine how much is owed. There
are different requirements insurance companies must follow. If the insurance
company you are dealing with is your own (you are claiming the car total loss
against your own insurance company) then they will be bound by the terms of the
policy, which 99% of the time requires them to pay the bank first. If you are
making a total loss against someone else’s insurance company (the person that
hit you), then this requirement does not exist (there is no actual policy to be
bound by).
If you have a loan, then the insurance adjuster will
request from the bank a Letter of Guarantee. This letter is an agreement between
the bank and the insurance company that for the payment of x amount, the bank
will release the title of the car to the insurance company directly. This
process usually takes four to five days.
If the amount you owe for the car is less than what the
insurance company will pay for the car total loss, then the insurance company
will pay the loan amount and then issue you a second check directly. If the loan
amount is higher than what the car total loss offer, then you will be upside
down your loan. You will be required to continue making payments even though the
car title will be transferred to the insurance company.
Once you receive payment for your loss, you will be able to
go out and get another car. For more information the total loss process and how
to protect your interest, visit:
http://www.auto-insurance-claim-advice.com
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Sources of Medical Help for People with No Insurance
Most people think that acquiring medical help for people with no insurance is nearly impossible, and ro some extent they’re right. It’s almost impossible in this day and age to acquire medical help for people with no insurance, ‘almost’ being the operative word. However there’s still a slight chance to help those who are unable to afford insurance policies.
Possible Sources of Medical Help for People with No Insurance
According to the 2006 Annual Social and Economic Supplement to the Current Population Survey, the rate of uninsured people in the United States has increased by three points at 15.9% from the previous 15.6%. This means that approximately forty-seven million people today are living day to day without the protection of health insurance.
If you or a friend of yours belongs to this group, here are several possible options to choose from when the need to obtain medical help arises.
Personal Borrowing.
Naturally, the first person you’d consider asking for help would be someone you know. Indeed, it wouldn’t be surprising if you’re to find a survey that attests to how medical help for people with no insurance, in most cases, are provided by friends, relatives, or colleagues of the patient.
Personal borrowing however is never an easy decision to make. Firstly, it has the power to affect and change the relationship between borrower and lender. It could require sacrificing your pride or compromising your friendship. It could create conflict if you realize you’re unable to pay back the money you owe on time.
Mortgages and Loans.
The second possible source of medical help for people with no insurance are mortgage and loan providers. You may not have cash right now, but you may also have certain properties or assets in your name. If these assets can be mortgaged or used as collateral, you may be able to obtain sufficient funds to take care of your expenses.
Public Hospitals and Clinics
The options mentioned previously shouldn’t be your primary choices. Medical help for people with no insurance may be provided for free at public hospitals and clinics. If your injuries or illness is not that serious, you may not even have to pay a cent for your medical bills. But you do have to provide sufficient proof first that you genuinely do not have any means right now to foot your medical expenses.
Government Programs
Medical help for people with no insurance can also be achieved for free or at extremely reduced costs if these people can fulfill certain requirements. Minors, for instance, have a good chance of attaining medical help for free even if these people have no insurance because most, if not all, state governments have established welfare programs to take care of the youth. People who belong to the minority like Native American tribes also have a chance of attaining medical help for free or at low costs by looking for a government program that’s primarily designed for their race.
This option obviously requires you to conduct extensive research, but they offer better rewards than other alternatives.
Charitable Aid
Asking for help from a charitable or non-profitable organization is usually considered by many as their last resort, because for them it is akin to admitting that they are totally without resources to solve their problems. If you’ve reached this point of your life, be glad at least that charitable organizations do exist because all you need to do is state your problem in clear and concise terms – some people play dirty by making themselves sound as pitiful as possible – and then simply wait for the verdict.
Alternative Medications
Keep in mind that medicine comes in a variety of forms, so if you can’t obtain traditional medical help for your problems, you can always search for alternative means like herbal medication, acupuncture, or even meditation if you think it can help improve your situation.
As alternative medications still haven’t been completely approved by medical professionals, you have to be extremely careful when choosing which medication or treatment you’d use. Alternative medications and treatments may be cheaper, but they involve a higher amount of risk as well.
Be sure to research extensively about your preferred treatment or medication and if possible have a medical professional check as well before ingesting or attempting anything.
As you can see, there are various sources of medical help for people with no insurance so it ultimately depends on how hard you work to obtain what you want.
Forced Place Insurance
Forced place insurance refers to insurance taken out by a bank or creditor on uninsured debtor’s behalf on a property placed as collateral. In case the property is damaged, funding is available to repair it. This type of insurance is most common with flood insurance; the flood insurance regulations of each agency provide notification procedures that should be followed. Forced place insurance can also be purchased for other hazards also.
Guidelines:
o Forced place hazard/flood insurance is general liability insurance for residential and commercial properties and foreclosed properties. It can also cover vacant properties, mobile homes, town houses and condominiums.
o Forced place insurance is a proven hazard insurance program. It has been designed specifically for mortgage lenders and services.
o It provides insurance cover to protect the mortgage collateral against fire and such like property hazards. However, it is most common with flood insurance.
Avoiding Lawsuits:
o The power to force place should be included in the contract note when taking out the mortgage. This will save you a lot of trouble later and prevent lawsuits against lenders placing insurance. The powers and obligations should be spelt out clearly in the loan contract note at the outset.
o If the lender has force placed insurance, do not pass on the charge to the customer that is greater than the actual cost of the insurance. It amounts to retaining a commission, which is liable for litigation.
o If a lender force places hazard insurance, the policy and disclosure letter should be made known to state.
o Insurance procured by the lender for whatever reason and that is not reflected in lender’s record, is also a strong case for later litigation.
o There are laws regulating force placed insurance in Connecticut, New Mexico, Florida, New York, Hawaii, Tennessee, Maryland, Texas and Mississippi.
Insurance cover for fire handling for vacant and foreclosed properties is very expensive and can create servicing burden. Loans made on properties located in federally designated flood zones too prove to be expensive and cause difficulty to bank’s loan servicing department. The federal flood tracking regulations for these types of loans are now imposed on the lender, thus increasing the mortgage premium considerably.
Solution Offered by FSIA, Inc.
The firm offers a Forced Placed Property/Liability/Flood program that claims to provide maximum protection with the least hassles. The program has some outstanding features that include:
o Instant binding authority for occupied and vacant properties, residential or commercial
o Competitive rates and no minimum premium or deposits
o Flexible monthly billing
o Flood zone determinations.
o Flood insurance quoting and placement programs.
o Flood insurance tracking.
Forced place insurance is essential for a bank or lender on an uninsured debtor’s behalf, to ensure that funding is available in the event of damage to the property. Ensure that the legal requirements are complied with to avoid litigation later.
Due Diligence Checklists – For Commercial Real Estate Transactions
Planning to purchase or finance Commercial or Industrial Real Estate? Shopping Center? Office Building? Restaurant/Banquet property? Parking Lot? Storefront? Gas Station? Manufacturing facility? Warehouse? Logistics Terminal? Medical Building? Nursing Home? Hotel/Motel? Pharmacy? Bank facility? Sports and Entertainment Arena? Other?
A KEY to investing in commercial real estate is performing an adequate Due Diligence Investigation to assure you know all material facts to make a wise investment decision and to calculate your expected investment yield.
The following checklists are designed to help you conduct a focused and meaningful Due Diligence Investigation.
Basic Due Diligence Concepts:
Commercial Real Estate transactions are NOT similar to large home purchases.
Caveat Emptor: Let the Buyer beware.
Consumer protection laws applicable to home purchases seldom apply to commercial real estate transactions. The rule that a Buyer must examine, judge, and test for himself, applies to the purchase of commercial real estate.
Due Diligence: “Such a measure of prudence, activity, or assiduity, as is proper to be expected from, and ordinarily exercised by, a reasonable and prudent [person] under the particular circumstances; not measured by any absolute standard, but depending upon the relative facts of the special case.” Black’s Law Dictionary; West Publishing Company.
Contractual representations and warranties are NOT a substitute for Due Diligence.
Breach of representations and warranties = Litigation, time and money.
WHAT DILIGENCE IS DUE?
The scope, intensity and focus of any due diligence investigation of commercial or industrial real estate depends upon the objectives of the party for whom the investigation is conducted. These objectives may vary depending upon whether the investigation is conducted for the benefit of (i) a Strategic Buyer (or long-term lessee); (ii) a Financial Buyer; (iii) a Developer; or (iv) a Lender.
If you are a Seller, understand that to close the transaction your Buyer (and its Lender) must address all issues material to its objective – some of which require information only you, as Owner, can adequately provide.
GENERAL OBJECTIVES:
(i) A “Strategic Buyer” (or long-term lessee) is acquiring the property for its own use and must verify that the property is suitable for that intended use.
(ii) A “Financial Buyer” is acquiring the property for the expected return on investment generated by the property’s income stream, and must determine the amount, velocity and durability of the revenue stream. A sophisticated Financial Buyer will likely calculate its yield based upon discounted cash-flows rather than the must less precise capitalization rate (“cap rate”), and will need adequate financial information to do so.
(iii) A “Developer” is seeking to add value by changing the character or use of the property – usually with a short-term to intermediate-term exit strategy to dispose of the property; although, a Developer might plan to hold the property long term as Financial Buyer after development or redevelopment. The Developer must focus on whether the planned change is character or use can be accomplished in a cost-effective manner. A developer conducting due diligence will focus on issues involving market demand, access, use and finances.
(iv) A “Lender” is seeking to establish two basic lending criteria:
1. “Ability to Repay” – The ability of the property to generate sufficient revenue to repay the loan on a timely basis; and
2. “Sufficiency of Collateral” – The objective disposal value of the collateral in the event of a loan default, to assure adequate funds to repay the loan, carrying costs and costs of collection in the event forced collection becomes necessary.
The amount of diligent inquiry due to be expended (i.e. “Due Diligence”) to investigate any particular commercial or industrial real estate project is the amount of inquiry required to answer each of the following questions to the extent relevant to the objectives of the party conducting the investigation:
I. THE PROPERTY:
1. Exactly what PROPERTY does Purchaser believe it is acquiring?
(a) Land?
(b) Building?
(c) Fixtures?
(d) Other Improvements?
(e) Other Rights?
(f) The entire fee title interest including all air rights and subterranean rights?
(g) All development rights?
2. What is Purchaser’s planned use of the Property?
3. Does the physical condition of the Property permit use as planned?
(a) Commercially adequate access to public streets and ways?
(b) Sufficient parking?
(c) Structural condition of improvements?
(d) Environmental contamination?
(i) Innocent Purchaser defense vs. exemption from liability
(ii) All Appropriate Inquiry
4. Is there any legal restriction to Purchaser’s use of the Property as planned?
(a) Zoning?
(b) Private land use controls?
(c) Americans with Disabilities Act?
(d) Availability of licenses?
(i) Liquor license?
(ii) Entertainment license?
(iii) Outdoor dining license?
(iv) Drive through windows permitted?
(e) Other impediments?
5. How much does Purchaser expect to pay for the property?
6. Is there any condition on or within the Property that is likely to increase Purchaser’s effective cost to acquire or use the Property?
(a) Property owner’s assessments?
(b) Real estate tax in line with value?
(c) Special Assessment?
(d) Required user fees for necessary amenities?
(i) Drainage?
(ii) Access?
(iii) Parking?
(iv) Other?
7. Any encroachments onto the Property, or from the Property onto other lands?
8. Are there any encumbrances on the Property that will not be cleared at Closing?
(a) Easements?
(b) Covenants Running with the Land?
(c) Liens or other financial servitudes?
(d) Leases?
9. Leases?
(a) Security Deposits?
(b) Options to Extend Term?
(c) Options to Purchase?
(d) Rights of First Refusal?
(e) Rights of First Offer?
(f) Maintenance Obligations?
(g) Duty on Landlord to provide utilities?
(h) Real estate tax or CAM escrows?
(i) Delinquent rent?
(j) Pre-Paid rent?
(k) Tenant mix/use controls?
(l) Tenant exclusives?
(m) Tenant parking requirements?
(n) Automatic subordination of Lease to future mortgages?
(o) Other material Lease terms?
10. New Construction?
(a) Availability of construction permits?
(b) Utilities?
(c) NPDES (National Pollutant Discharge Elimination System) Permit?
(i) Phase 2 effective March 2003 – Permit required if earth is disturbed on one acre or more of land.
(ii) If applicable, Storm Water Pollution Prevention Plan (SWPPP) is required.
II. THE SELLER:
1. Who is the Seller?
(a) Individual?
(b) Trust?
(c) Partnership?
(d) Corporation?
(e) Limited Liability Company?
(f) Other legally existing entity?
2. If other than natural person, does Seller validly exist and is Seller in good standing?
3. Does the Seller own the Property?
4. Does Seller have authority to convey the Property?
(a) Board of Director Approvals?
(b) Shareholder or Member approval?
(c) Other consents?
(d) If foreign individual or entity, are any special requirements applicable?
(i) Qualification to do business in jurisdiction of Property?
(ii) Federal Tax Withholding?
(iii) US Patriot Act compliance?
5. Who has authority to bind Seller?
6. Are sale proceeds sufficient to pay off all liens?
III. THE PURCHASER:
1. Who is the Purchaser?
2. What is the Purchaser/Grantee’s exact legal name?
3. If Purchaser/Grantee is an entity, has it been validly created and is it in good standing?
(a) Articles or Incorporation – Articles of Organization
(b) Certificate of Good Standing
4. Is Purchaser/Grantee authorized to own and operate the Property and, if applicable, finance acquisition of the Property?
(a) Board of Director Approvals?
(b) Shareholder or Member approval?
(c) If foreign individual or entity, are any special requirements applicable?
(i) Qualification to do business in jurisdiction of the Property?
(ii) US Patriot Act compliance?
(iii) Bank Secrecy Act/Anti-Money Laundering compliance?
5. Who is authorized to bind the Purchaser/Grantee?
IV. PURCHASER FINANCING:
A. BUSINESS TERMS OF THE LOAN:
What loan terms have the Purchaser, as Borrower, and its Lender agreed to?
(a) What is the amount of the loan?
(b) What is the interest rate?
(c) What are the repayment terms?
(d) What is the collateral?
(i) Commercial real estate only?
(ii) Real estate and personal property together?
(e) First lien? A junior lien?
(f) Is it a single advance loan?
(g) A multiple advance loan?
(h) A construction loan?
(i) If it is a multiple advance loan, can the principal be re-borrowed once repaid prior to maturity of the loan; making it, in effect, a revolving line of credit?
(j) Are there reserve requirements?
(i) Interest reserves?
(ii) Repair reserves?
(iii) Real estate tax reserves?
(iv) Insurance reserves?
(v) Environmental remediation reserves?
(vi) Other reserves?
(k) Are there requirements for Borrower to open business operating accounts with the Lender? If so, is the Borrower obligated to maintain minimum compensating balances?
(l) Is the Borrower required to pledge business accounts as additional collateral?
(m) Are there early repayment fees or yield maintenance requirements (each sometimes referred to as “pre-payment penalties”)?
(n) Are there repayment blackout periods during which Borrower is not permitted to repay the loan?
(o) Is there a Loan Commitment fee or “good faith deposit” due upon Borrower’s acceptance of the Loan Commitment?
(p) Is there a loan funding fee or loan brokerage fee or other loan fee due Lender or a loan broker at closing?
(q) What are the Borrower’s expense reimbursement obligations to Lender? When are they due? What is the Borrower’s obligation to pay Lender’s expenses if the loan does not close?
B. DOCUMENTING THE COMMERCIAL REAL ESTATE LOAN
Does Purchaser have all information necessary to comply with the Lender’s loan closing requirements?
Not all loan documentation requirements may be known at the outset of a transaction, although most commercial real estate loan documentation requirements are fairly typical. Some required information can be obtained only from the Seller. Production of that information to Purchaser for delivery to its lender must be required in the purchase contract.
As guidance to what a commercial real estate lender may require, the following sets forth a typical Closing Checklist for a loan secured by commercial real estate.
Commercial Real Estate Loan Closing Checklist
1. Promissory Note
2. Personal Guaranties (which may be full, partial, secured, unsecured, payment guaranties, collection guaranties or a variety of other types of guarantees as may be required by Lender).
3. Loan Agreement (often incorporated into the Promissory Note and/or Mortgage in lieu of being a separate document)
4. Mortgage [sometimes expanded to be a Mortgage, Security Agreement and Fixture Filing]
5. Assignment of Rents and Leases
6. Security Agreement
7. Financing Statement (sometimes referred to as a “UCC-1″, or “Initial Filing”)
8. Evidence of Borrower’s Existence In Good Standing; including
(a) Certified copy of organizational documents of borrowing entity (including Articles of Incorporation, if Borrower is a corporation; Articles of Organization and written Operating Agreement, if Borrower is a limited liability company; Certified copy of trust agreement with all amendments, if Borrower is a land trust or other trust; etc.)
(b) Certificate of Good Standing (if a corporation or LLC) or Certificate of Existence (if a limited partnership) or Certificate of Qualification to Transact Business (if Borrower is an entity doing business in a State other than its State of formation)
9. Evidence of Borrower’s Authority to Borrow; including
(a) a Borrower’s Certificate;
(b) Certified Resolutions
(c) Incumbency Certificate
10. Satisfactory Commitment for Title Insurance (which will typically require, for analysis by the Lender, copies of all documents of record appearing on Schedule B of the title commitment which are to remain after closing), with required commercial title insurance endorsements, often including:
(a) Affirmative Creditors Rights Endorsement (extending coverage over policy exclusion 7 and policy exclusions 3(a) and 3(d) as they relate to creditor’s rights matters)
(b) ALTA 3.1 Zoning Endorsement modified to include parking
(c) ALTA Comprehensive Endorsement 1
(d) Location Endorsement (street address)
(e) Access Endorsement (vehicular access to public streets and ways)
(f) Contiguity Endorsement (the insured land comprises a single parcel with no gaps or gores)
(g) PIN Endorsement (insuring that the identified real estate tax permanent index numbers are the only applicable PIN numbers affecting the collateral and that they relate solely to the real property comprising the collateral)
(h) Usury Endorsement (insuring that the loan does not violate any prohibitions against excessive interest charges)
(i) other title insurance endorsements applicable to protect the intended use and value of the collateral, as may be determined upon review of the Commitment for Title Insurance and Survey or arising from the existence of special issues pertaining to the transaction or the Borrower.
11. Current ALTA Survey (3 sets), [typically prepared in accordance with 2005 Minimum Standard Detail for ALTA/ACSM Land Title Surveys, certified to the lender, Buyer and the title insurer, including items 1 through 4, 6, 7(a), 7(b)(1), 8 through 11(a) and 14 from the Surveyor's "Optional Survey Responsibilities and Specifications" referred to as "Table A"].
12. Current Rent Roll
13. Certified copy of all Leases (3 sets)
14. Lessee Estoppel Certificates
15. Lessee Subordination, Non-Disturbance and Attornment Agreements [sometimes referred to simply as "SNDAs"].
16. UCC, Judgment, Pending Litigation, Bankruptcy and Tax Lien Search Report
17. Appraisal (must comply with Title XI of FIRREA (Financial Institutions Reform, Recovery and Enforcement Act of 1989, as amended)
18. Environmental Site Assessment Report (sometimes referred to as Environmental Phase I and/or Phase 2 Audit Reports)
19. Environmental Indemnity Agreement (signed by Borrower and guarantors)
20. Site Improvements Inspection Report
21. Evidence of Hazard Insurance naming Lender as the Mortgagee/Lender Loss Payee; and Liability Insurance naming Lender as an “additional insured” (sometimes listed as simply “Acord 27 and Acord 25, respectively)
22. Legal Opinion of Borrower’s Attorney
23. Credit Underwriting documents, such as signed tax returns, property operating statements, etc. as may be specified by Lender
24. Compliance Agreement (sometimes also called an Errors and Omissions Agreement), whereby the Borrower agrees to correct, after closing, errors or omissions in loan documentation.
It is useful to become familiar with the Lender’s loan documentation requirements as early in the transaction as practical. The requirements will likely be set forth with some detail in the lender’s Loan Commitment – which is typically much more detailed than most loan commitments issued in residential transactions.
Conducting the Due Diligence Investigation in a commercial real estate transaction can be time consuming and expensive in all events.
If the loan requirements cannot be satisfied, it is better to make that determination during the contractual “due diligence period” – which typically provides for a so-called “free out” – rather than at a later date when the earnest money may be at risk of forfeiture or when other liability for failure to close may attach.
CONCLUSION
Conducting an effective due diligence investigation in a commercial real estate transaction to discover all material facts and conditions affecting the Property and the transaction is of critical importance.
Unlike owner occupied residential real estate, when a house can nearly always be occupied as the purchaser’s home, commercial real estate acquired for business use or for investment is impacted by numerous factors that may affect its use and value.
The existence of these factors and their affect on a Purchaser’s ability to use the Property for its intended use and on the Purchaser’s projected investment yield can only be discovered through diligent investigation and attention to detail.
The circumstances of each transaction will determine what degree of diligence is required. The level of diligence required under the circumstances is the diligence that is due.
Exercise Due Diligence.
Posted in Insurer Articles | Tags: Checklists, Commercial, Diligence, Estate, Transactions | No Comments »
Insurance Adjuster – How Much Money Does a Claims Adjuster Make?
How much insurance claims adjusters can make per annum is the subject of considerable interest and speculation to those interested in a career in claims. As unstable weather continues into the fall, and the Atlantic hurricane season reaches its stride, its important to correctly understand the financial landscape of the adjuster industry.
Some folks have heard from their girlfriend’s brother or an estranged uncle that claims adjusting is a money tree. The money tree sits there blooming Benjamins, apparently just waiting happily to be plucked by any newcomer with the inside scoop. And as an added bonus, you really don’t have to do work. The opposite extreme is my own previous misconception of the monetary compensation for claims adjusters which is that they made next to nothing and it was essentially a dead end job. This is as far from the truth as the money tree concept but, I would hazard to guess, a much more prevalent misunderstanding.
So how much money does an insurance adjuster really make?
According to the U.S. Department of Labor, claims adjusters earned an average of $44,220 in 2004. The top ten percent earned more than $72,620. The bottom ten percent earned less than $27,220. This seems like a fairly significant disparity. What type of adjuster is at the bottom and what type at the top?
The answer to this question depends largely upon the type of claims adjuster you are referring to. In general, there are two types of adjusters: staff adjusters who are salaried employees of an insurance carrier, and independent adjusters who are independent contractors working for adjusting firms. This initial difference will make as much of a difference in pay structure as the type of claims actually handled – from worker’s compensation to multi-million dollar commercial properties.
Staff adjusters are typically going to be earning less than independent adjusters and in some cases dramatically less. $25,000-$60,000 is a reasonable salary range for a career staff claim adjuster.
An independent adjuster in a good year, however, especially if he or she works catastrophe claims, can make well in excess of $100,000.
Staff adjusters can make a good stable living. For independent adjusters, the opportunity can be a little more interesting and, I think, exciting. Independent adjusters working catastrophe claims make essentially a percentage of the amount of each claim they settle. This system of payment is known as a fee schedule and is formulated differently for each insurance carrier represented and storm situation confronted. For example, an independent adjuster handling hurricane claims may receive a fee schedule that pays $500 for claims between $3,000 to $5,000, $650 for claims between $5,000 and $7,500, and $750 for claims between $7,500 and $10,000. An adjuster will receive between 60-70% with the other 30-40% going to the adjusting firm they work for. Hurricane adjusters can easily average $10,000 settlement per claim and thus average between $400 and $500 dollars in their pocket per claim. A good adjuster should be closing 2 to 4 claims per day with superb adjuster closing 4 to 7.
Making over $1,000 a day as an independent adjuster working catastrophe claims is common and very attainable. In this way, a good independent adjuster can surpass six figures income in less than six months.
So, is this the money tree after all? Well, not so fast. Remember that catastrophes, especially catastrophes sufficient to employ significant numbers of adjusters, are relatively few and far between. During “dry” spells for independent adjusters, work can be scarce and competition fierce for the claims that do come along. That said, there is a tremendous and exciting opportunity for very real, very lucrative money when disaster does strike.
Whether its operating on staff or as independent contractor, claims adjusting offers potential for solid and, in some cases, spectacular income.
Blue Cross Blue Shield Dental Insurance – Always a Top Choice
Considering dental health is important to the majority of people, having a
choice of numerous health care plans can make life much easier. Having dental
insurance can help individuals and families when it comes to paying bills after
a trip to the dentist. With its various plans for individuals, families, and
groups, Blue Cross Blue Shield has become the most popular choice among people
seeking dental insurance.
There is no doubt that Blue Cross Blue Shield has plan that will work for you.
When you are ready to make a decision on which plan you will choose, you should
read into detail about each individual one. Finding out what benefits you can
obtain from each plan can further help you in deciding which one would be
perfect under your circumstances.
Like shopping for any other product, you always want a top brand that is well
known for its credibility. With individuals all across the United States using
Blue Cross Blue Shield, it is obvious this is a reliable company with much to
offer. If you ever have questions about Blue Cross Blue Shield, or any other
company that offers dental insurance, you can easily gather information by using
the internet. With money being a factor in everyone’s life, the internet has
made it simple to find a dental plan which you can afford in the long run.
Along with modifying old dental plans, Blue Cross Blue Shield has kept up with
making new plans in order to assist every individual in one way or another.
Blue Cross Blue Shield’s dental health plans are said to be some of the most
popular forms of insurance coverage that their company has to offer. With its
popularity only increasing over the years, it is clear that Blue Cross Blue
Shield is a reliable company to work with. With a little bit of research,
you’ll learn that this company makes it simple to find the perfect dental health
plan for you.
Information About No-Fault Car Accident Benefits
1. I was injured in a car accident. Am I entitled to compensation?
In addition to the possibility of a lawsuit to recover a money award or settlement for injuries, pain and suffering and other losses, Ontario’s government requires automobile insurers to provide certain mandatory benefits to most people who are injured or killed in car accidents. These benefits are called “statutory accident benefits”. The statutory accident benefits system operates on a “no-fault” basis. This means that, subject to some limited restrictions, you may be entitled to compensation even if you are the one that caused the accident.
As an injured party, you may well be entitled to receive benefits regardless of whether you were a driver, passenger, cyclist or pedestrian. You, as well as your family members and dependants, can often receive benefits even if you did not have car insurance at the time of the accident.
There are often disputes about what benefits you are entitled to and what insurance assessments you are required to attend. It is often a good idea to consult with a personal injury lawyer to determine what you are entitled to and what steps you need to take to protect your interests.
2. What kind of benefits can I receive?
Income Replacement Benefits – these benefits are designed to reimburse you for some of the money you lose as a result of being unable to work due to an injury suffered in a car accident. Benefits are not payable for the first week and you must meet a disability test to qualify for the benefits. The disability test becomes more difficult to meet after more than two years have passed since the accident.
You can receive income replacement benefits whether you are an employee or a self-employed individual. The maximum that you can receive is generally $400 per week, unless other optional increased benefits are purchased.
If you are self-employed, your income calculation will be more complicated and insurers often hire accountants to assist them with these calculations.
Non-earner Benefits – you may receive these benefits if you are 16 years of age or older and have suffered a complete inability to carry on a normal life as a result of the accident within 104 weeks after the accident. A lawyer can assist in explaining what “complete inability to carry on a normal life” means and how that term has been interpreted by the cases. The benefits are only available to certain classes of people, ie: unemployed but enrolled in school on a full-time basis, or have completed your education less than one year before the accident and not be employed in a job that reflects your education and training.
The amount of the non-earner benefit is generally $185 per week, although nothing will be payable for the first 26 weeks of the disability. However, if your disability has lasted for more than 104 weeks, you will be entitled to receive $320 per week following the initial 104 week period.
Caregiver Benefits – these benefits may be payable if you (the injured person) were living with a person in need of care (such as a young child or an elderly parent) prior to the accident and were not being paid for these services. You may be able to recover reasonable and necessary expenses up to a maximum of $250 per week for the first person in need of care and $50 per week for each additional person. You should note that when it comes to the income replacement, non-earner and caregiver benefits, only one of these three benefits can be paid at any given period of time.
Medical and Rehabilitation Benefits – this benefit deals with reimbursement for reasonable and necessary expenses such as medical, surgical, dental, optometric, hospital, nursing, ambulance, audio metric, speech-language pathology, chiropractic, psychological, occupational therapy, physiotherapy, medication, prescription eyewear, dentures, hearing aids, wheelchairs, prostheses, orthotics, transportation to and from treatment sessions (excluding the first 50 kilometers of the trip in the injured person’s vehicle), workplace/home/vehicle modifications, life skills training, counseling, and vocational assessments.
Subject to some exceptions set out in the pre-approved framework guidelines, you must submit a treatment plan to the insurance company prior to beginning treatment. If you do not submit a treatment plan, the insurance company could refuse to compensate you for treatment. The treatment plan must be prepared by a health professional and signed by one of the following – physician, psychologist, physiotherapist, dentist, or optometrist.
You can receive a maximum reimbursement of $100,000 for “reasonable and necessary” expenses acquired in the period of 10 years following the accident. If you suffered “catastrophic impairment”, you may be entitled to receive up to $1,000,000 incurred over your lifetime.
Attendant Care Benefits – this benefit may provide compensation for services of an aide or an attendant who is assisting you due to your injury. This could include services of a family member or other aide looking after you at home, or services provided by a long-term care facility including a nursing home, home for the aged or chronic care hospital.
You may be entitled to a maximum of $3,000 per month for two years following the accident. If you suffered “catastrophic impairment”, you may receive up to $6,000 per month up to a maximum of $1,000,000 without a time limit. The insurer may ask you to provide it with a certificate from a health professional confirming that you require attendant care services.
Funeral and Death Benefits – when a person dies due to a car accident, his or her estate may be entitled to reimbursement of funeral expenses to a maximum of $6,000.
The deceased’s spouse, dependants and caregivers may also be entitled to death benefits. Death benefits are usually only payable if the deceased died within 180 days after the accident, or, if the deceased was continuously disabled as a result of the accident, within 156 weeks after the accident. No benefits will be payable to a person who dies before the deceased or within 30 days after the deceased.
A spouse may receive $25,000 if the deceased was married. If the deceased was not married, but had dependents, the $25,000 would be divided equally among the dependents. On top of the $25,000, each of the dependents and former spouses of the deceased (to whom the deceased had an obligation to pay spousal support) will be entitled to $10,000.
If the deceased was himself or herself a dependent at the time of the accident (ex. if the deceased was a minor child), $10,000 would be payable to the person upon whom the deceased was dependent (ex. parent or grandparent) or, if that person is dead, to that person’s surviving spouse or dependents.
Visiting Expenses – if you sustained injury in a car accident, your family members and individuals who were living with you at the time of the accident may be entitled to reimbursement for all of their reasonable and necessary expenses incurred as a result of coming to visit you during your treatment or recovery. The visitors will only be reimbursed for expenses incurred within 104 weeks after your accident, unless your injury is catastrophic.
Lost Education Expenses – if, due to your injuries, you are unable to continue in the education program in which you were enrolled at the time of the accident, you may be entitled to claim for your lost education expenses up to the maximum amount of $15,000. You may get reimbursed for expenses incurred before the accident including tuition, books, equipment or room and board.
Housekeeping and Home Maintenance Expenses – you may receive compensation for reasonable and necessary housekeeping and home maintenance expenses, if your injury resulted in a substantial inability to do your housekeeping and home maintenance and you normally performed home maintenance services before your accident. Your housekeeping and home maintenance expenses may be paid for 104 weeks to a maximum of $100, unless the injury is catastrophic, in which case the time-limit does not apply.
Psychological and Mental Injuries – your family members and dependents (whether related or not) may be entitled to receive benefits if they have suffered psychological injuries as a result of your accident.
Cost of Examinations – you may be reimbursed for reasonable fees charged by health care providers in preparing disability certificates, reviewing and approving treatment plans, preparing applications for approval of assessments or examinations, preparing assessments of attendant care needs, and preparing applications for determinations of catastrophic impairment. You are normally required to obtain consent of the insurer before incurring examination expenses. However, there are certain exceptions. Your treatment providers may well be able to assist you in applying for these benefits
Other Expenses – you may be entitled to be reimbursed for all reasonable expenses you incurred in repairing or replacing clothing, prescription eye wear, dentures, hearing aids, prostheses and other medical or dental devices that were lost or damaged as a result of the accident.
3. How can I claim my benefits?
Compensation will not be paid to you automatically following your accident. In order to receive benefits, you should notify your insurer within seven days of the date of the accident that you wish to submit an application. Late applications are made in many cases and you could discuss this with a lawyer. The insurer will then be required to send you the application forms as soon as possible. You will have to complete the forms and send them back to your insurer within 30 days. If you will not be able to meet the 30-day deadline because of the severity of your injuries, it is probably a good idea for you to advise your insurance company (but you may well wish to seek legal advice from a lawyer).
4. Which insurance company will provide my statutory accident benefits?
If you have car insurance or if you are a listed driver on someone else’s auto insurance policy, your own insurer will likely be responsible for providing you with benefits.
If you do not have auto insurance, and you were injured in a car accident as a pedestrian or a cyclist, you may be able to apply to the insurance company that insured the car that hit you. If you were a passenger, you may well be able to apply to the company that insured the car in which you were riding.
In some situations, no insured drivers are involved. In such cases, you may be able to claim compensation from a special government fund (the “Motor Vehicle Accident Claims Fund”) set up to handle these type of scenarios.
It is important to remember that statutory accident benefits will generally only compensate you for losses that are not covered by some other private insurance policy or employment benefits plan. If these other policies or plans will cover only part of the losses incurred, the statutory accident benefits can be used to compensate you for the balance, subject to some limitations.
5. What can I do if the insurance company denied my claim for benefits?
If you are having problems recovering benefits to which you are entitled, you may be entitled to sue the insurer in court or try to enforce payment through arbitration. However, before you can proceed to court or to arbitration, you are required to mediate the dispute with the Financial Services Commission. It is extremely important to initiate mediation within two years from the date that the benefit was denied. An injury/car accident lawyer can provide further details with respect to this.
California Auto Insurance Ratings
Auto insurance ratings are crucial factors in judging an auto insurance company. The rating varies from company to company. In California, one can find a number of high and medium rating auto insurance companies, catering to all insurance needs and situations.
The insurance rating of an auto insurance company is based on its financial stability, as reported to the state government and the rating agencies periodically. There are a number of agencies in California to rate the financial data of insurance companies. These ratings are available free of cost to the public, reliable and easy to access. So, whenever you look for purchasing auto insurance in California, the important thing to do is choose a financially secure company. Most agencies post their ratings on websites or in rating books available in libraries and book malls.
Searching auto insurance rating systems in California may be confusing. The top performing companies are awarded “A” rate, while “C” stands for average. This rating strategy seems to be equal for almost all agencies. Sometimes the rating is indicated by “A++” or “A+” for superior and “A” or “A-” for excellent insurance providers. Even though an insurance company comes with “A” rating, it may show potential problems when paying claims. At the same time, “C” rated companies have not much financial strength to face too many accident claims in a short period. So, before purchasing insurance, it is advisable to have a comprehensive understanding about ratings of companies. This is essential to identify the company that can maintain the top tier for a longer period.
As in other states in America, California uses auto insurance ratings as the evaluating factor for measuring the operating performance of a company and its ability to meet the obligations of policyholders. According to a new insurance rating plan, insurers have to consider the safety records of drivers, years of driving experience and annual mileage.