Month: December 2014

Liability Auto Insurance and the Necessity to Have Adequate Coverage

GrahamAuto Insurance

Liability insurance is a must have for your car and in fact it is illegal not to have it in all 50 states.  Not only that but it is required to register a car.  In any case it is one of the most important types of insurance you can have because it protects you financially if you cause damage to another driver’s body and/or property.  For the average American their vehicle is potentially the most dangerous and damage causing item they own.  This is especially true for individuals that drive a lot and in congested areas.  This is why it is important not to be cheap and under insure yourself with liability coverage.   What would you do if you hit a Bentley or even worse caused someone else to be severely injured?  You k now the cost will be high in those scenarios and if you don’t have sufficient liability insurance you could be on the hook for some major money.

Liability auto insurance is made up of 3 parts: bodily injury per person, bodily injury per accident and property damage.  Now each state will have a minimum of those 3 components.  As an example in New Jersey the minimum required liability car insurance is bodily injury of $15,000 per person, 30,000 of bodily injury per accident and 5,000 for property damage.  Each state will vary with these but in any case they are all absurdly low considering its possible to cause hundreds of thousands of dollars (if not more) with your car.  Ask a personal injury lawyer how much liability auto insurance you should have considering their role in suing insurance companies and individuals who have caused accidents.

The main point here is that it is important to have adequate liability auto insurance or you could be sorry.  If you can go with the single limit coverage of $500,ooo. 

Tips Regarding Life Insurance Coverage

GrahamNotes on Life Insurance

Its natural to feel that talking about a subject like dying  and life insurance is morbid.  The reality is we are all mortal.  It is wise to face this reality and protect our loved ones in the event we do leave this world early.  With that said I’ve provided tips below that will help in seeking out life insurance coverage.

  1. The first thing to do is to estimate how much coverage you’ll need to purchase.  This is important because you’ll want to make sure you’re not under insured or even over insured.  So you’ll want to sit down and think about all the things that will have to be payed for and come up with an itemized list.   Its in your best interest to think about this very seriously and deeply as you don’t want to miss anything.  Ask yourself questions like:  Do I want my mortgage payed off?  What other debts do I have that I don’t want passing to my spouse and family?  How about college tuition for the kids?  If you need help with this task enlist an insurance professional, financial advisor and or take advantage of an online calculator like:  LIFE (a non profit organization) Life Insurance Needs Calculator.
  2. Consider the different types of life insurance coverages that are available.  Its important to understand on a basic level what the differences are between term life insurance,whole life insurance, variable life and universal life insurance.  Don’t let all the choices intimidate you,  just have a basic understanding before for you go shopping.  Most often term life insurance is the most appropriate but not always.
  3. Your employer may offer you a life insurance program.   Find out how much coverage they provide to you for free (if any) and if you can buy more to cover your needs.  Just remember this usually isn’t the end all be all of your life insurance needs.
  4. Buy life insurance from a reputable and financially sound insurance company.  Getting payed by an insolvent company is obviously less likely.  Your state regulates the insurance companies so find out if the prospective life insurance company participates in the  state’s guarantee  fund (which backs up insurance companies in the event they can’t pay) .  At the same time find out how much the guarantee fund covers for life insurance death benefits as well as cash value on policys.  Also take a look how the ratings agency’s  are viewing the insurance company.  Cross check the rating against at least these 4 agencys: AM Best, Fitch, Moodys and S&P.
  5. If you’re going to work with a financial advisor or insurance agent etc. ask them to disclose what they are getting out of selling you a policy.  You could work with a flat fee professional or a commissioned pro.  Either one may be appropriate but its vital to ask about what fees at they are getting out of it.  They are supposed to act in your best interest.  Call your state insurance commissioner’s department to see if the advisor or agent has any complaints against them.  Ask for references and don’t be afraid to conduct an interview with tough questions.
  6. Understand and ask for disclosure on what the insurance company is getting from you fee wise.  Certain types of policies will charge you fees that is in your best interest to know what they are.  This is especially true of variable and universal life insurance policies.
  7. Your health correlates to what your insurance premium cost will be.  So keeping a health life style will not only make you look, and feel better, it increase your life expectancy which equals more affordable insurance premiums.
  8. Use the worldwide web to your advantage in obtaining quotes.  You can go directly to an insurers website and ask for free quotes generally.  There are life insurance quotes services that may make this easier in obtaining multiple quotes.
  9. Don’t forget about using your own personal network for help in with finding an insurer.  Ask for references from your friends and family and their experience in finding life insurance coverage.
  10. Involve those that you’re protecting the life insurance with in this process of finding and understanding life insurance.  This will help them understand what you’ve provided too them and what to expect if you do pass.  It may also help them see the importance of life insurance and teach them how to search for their own policy.
 

Your Credit can Affect how much your Auto Insurance Costs

GrahamAuto Insurance

Perhaps you think that auto insurance companies are only concerned about how good your driving record is, how expensive your car is and how extensive your coverage is when setting rates.  Alas there other factors at play and one of those is your credit score.

Auto insurers think this is important because your credit history can give them an idea if they will get paid and if it will be on time.   Also they believe that based on stats that a low credit scores raises the likely hood of an auto insurance claim.  You can be sure that auto insurers will check your credit because they feel they are protecting themselves in an economically uncertain time (especially so because its more likely a policy holder’s financial picture has changed).  Also your credit score is easily accessible and if your credit history changes negatively (especially if its a drastic change)  your auto insurance rate can sky rocket.   This is another very good reason to periodically check to see if there are errors on your credit report.

Is this a correct practice to base an insurance rate on such?  Many believe it is not as consumer advocates have spoken out and some states have passed laws to limit insurance companies using credit to base rates.

Tal vez usted piensa que las compañías de seguros de automóviles son sólo preocupado por lo bien que su registro de conducción es, lo caro que su coche es y como extensión de su cobertura es la hora de establecer las tarifas. Desgraciadamente hay otros factores en juego y uno de ellos es su puntaje de crédito.

Las aseguradoras de automóviles que esto es importante, porque su historial de crédito les puede dar una idea de si se les paga, y si va a llegar a tiempo. También creen que, basándose en las estadísticas que una baja puntuación de crédito aumenta también la probabilidad de una reclamación de seguro de auto.  Usted puede estar seguro de que las aseguradoras de automóviles van a revisar su crédito, porque sienten que están protegiendo a sí mismos en un tiempo de incertidumbre económica (sobre todo porque su situación financiera más probable que un titular de la política ha cambiado). También su puntuación de crédito es de fácil acceso y si su historial de crédito cambia negativamente (sobre todo si es un cambio drástico) su tasa de seguro de auto puede cohete del cielo. Esta es otra buena razón para comprobar periódicamente para ver si hay errores en su informe de crédito.

¿Es esta una práctica correcta de basar una tasa de seguro de tales? Muchos creen que no es tan defensores de los consumidores han hablado y algunos estados han aprobado leyes para limitar las compañías de seguros de crédito con las tasas base. 

Have the Proper Coverage Auto Insurance Tip

PalmerAuto Insurance

Having the proper auto insurance protection is vital to protecting your financial situation.  Go over your policy and all the different components of it.  Start by asking yourself if you have enough liability coverage that if you were to cause injuries and or property damage that amounted to large amount of money  would you be protected?  You could be sued and on the hook for much money if that happened and you didn’t have enough liability.

Comprehensive is another important aspect of you car insurance policy that protects in the event of damange from things like theft, fires, hitting animals on the road etc.  Basically objects that could cause damage other than another automobile.  You definately need it if you have a vehicle with a loan on it and or if it has some valuable to it you couldn’t replace out of pocket.

Collision is a key compenant of a policy covering you to repair damage on your car if you hit another auto.  This is another must for those with loans or when your vehicle can’t be easily replaced or repaired with out of pocket funds.

Want to be covered for your medical bills if in an accident then PIP is important.  Consider other parts of the policy like Uninsured/Undermotorist coverage,  work loss, rental reimbursement all of which you find information this site.

The bottom line is that you want to examine you policy closely and understand the options that are available to you.  This will help you make an informed decision. 

Car Insurance for Seniors

PalmerAuto Insurance

When motorists get into their mid sixties and beyond the chance of being in an accident goes up.  This is because some studies have shown that statistically seniors’ perception on the road, reaction times, and hand to eye coordination diminish. Insurance companies know this and believe they are taking on more risk and therefore will increase car insurance rates for senior drivers.  Here are some ideas to help elderly drivers:

  • If you’ve retired make sure that your insurance company knows it as soon as possible.  Let them know the adjusted amount of miles driven which is surely or even significantly less and therefore should help lower your premiums.
  • As a senior looking to lower your auto insurance rates examine your deductible.  Perhaps you’re only driving locally and have a good amount of savings it may be worth it to look at raising your deductible which will in turn lower your rates.  *This is not a good option if you’re cash strapped.
  • Joining AARP is worth a look.  They are an advocate for folks 50+ and offer valuable services like a driver safety program and they can even provide auto insurance through The Hartford (which may or may not be the best choice).
  • When its time to purchase a new vehicle choose one that has excellent visibility, you’re most comfortable in driving, has a good crash record and is reasonable to insure.
  • Another possible factor in car insurance for seniors is health.  Maintaining your health is not only good for feeling great but your insurance company may ask for records like checkups and vision tests etc.
  • Insurance companies value customers with clean driving records no matter how old.  If you find your current company is not being fair then it shouldn’t be hard to find a new insurer when you have a spotless driver record.  Know matter how tempting it is to speed or be aggressive,  avoid being a bad driver and it will pay off.
  • Make sure to be aware of any state requirements to continue driving.  Some require just a vision test while others require further testing.
  • There will come a time when a senior will need to give up their keys and stop driving.  For further reference I’ve provided a link to this excellent article.
 

Your Job can be a Factor in Your Auto Insurance Rate

GrahamAuto Insurance

Your car insurance rate can be figured with different variables like driving record, car value,credit, age etc.  Many are not aware that what one does for a living can have a bearing on this as well.  Now not all insurance companies engage in using jobs in figuring auto insurance rates and some states as well as consumer groups do not look kindly upon this practice.

The reasoning that goes into using job as a rate factor comes from a statistical viewpoint.  Its looked at that if you have a highly strenuous job, drive constantly or otherwise others that have your job have a high rate of claims than it should raise your auto insurance premiums.

Some examples of job positions that are looked at as low risk by insurance companies are scientists, librarians and most performers of the arts.  On the other side occupations looked at as higher risk are lawyers, stock brokers and executives.

In New Jersey there was a bill proposed to ban this practice though it never got debated.  Consumer groups have come out against using job to determine rates.  Even so it is at this point legal for insurance companies to use your job as a determinant in your auto insurance.  This doesn’t mean that you can’t shop around to find a companies not using it;  in fact I’ve heard commercials from companies explicitly saying that they don’t engage in this practice. 

Comprehensive Car Insurance: A Short Synopsis

GrahamAuto Insurance

Comprehensive insurance is the component of your car insurance policy that pays you if your car is stolen or catches on file, hits a deer, is in a flood etc.  Its basically for covering an insured for reasons that could cause damage outside of collision like an “Act of God.”  Its important to examine your policy closely to see what the specifics of your coverage are.

Comprehensive insurance like collision has a deductible you’ll have to pay to repair the vehicle before the insurance company contributes the rest.  Its important to consider your deductible very closely.   For instance if you have a high deductible you’ll have to dish out more money if your car or truck is damaged.

If you are going to buy a new or used car that requires a loan you can be sure you’ll be required to get comprehensive insurance to pay the bank if the car is damaged in a fire, stolen etc.  Otherwise states generally don’t force you to buy this type of insurance.  If your vehicle isn’t worth much and you have the funds to replace it easily it may not be worth it to pay for the comprehensive premium. 

The Collision Component of Auto Insurance Coverage and Some Recomendations

GrahamAuto Insurance

Collision car insurance protects the insured if they are in an accident with another motor vehicle (or another object) in that it covers the cost of repairing the insured’s vehicle.  It is paid to the insured regardless of whether the accident was their fault.  This insurance is almost always a requirement if there is a loan on the car because if the automobile lets say is totaled  it protects the creditor.  It does so because the insurance payment to the policy holder is ideally enough to pay off the loan.  Now if the car is worth less than the loan then the insured has to pay the difference unless they have a gap rider (which is recommended).  If there is no loan on the car collision insurance  is not a requirement though the insured may regret not having it if the car has a least some value and  is badly damaged in a accident especially if it was their fault.

An important aspect of collision insurance is the deductible which is how much the policy holder has to pay out of pocket when the insurance company goes to make payment to repair the vehicle.   It would be better for a driver that does not have a lot of spare cash  to choose a lower deductible.  This is another reason why its important to review one’s auto policy at least once a year.   Another variable in the cost of collision insurance coverage is how much the automobile is worth as a more expensive vehicle will cost more to cover.

On a final note when a claims adjuster makes an offer to make a payment to repair or replace the vehicle that was damaged it certainly does not have to be accepted (especially the first time).  Check out my auto insurance claims tips here.  Sometimes you have to play hard ball with an insurance company if they aren’t being fair.