News
1. You can only shop for car insurance when your current policy expires.
Many consumers don’t realize that they aren’t bound to their insurance coverage for the full term (ie – 6/12 months). The insured can cancel at anytime, for any reason.
2. Working with a direct company (i.e. the little green lizard) is always cheaper than going through a local agent.
While it’s true that direct companies save money on costs by not incurring agent commission fees, this does not necessarily mean the savings will be passed on to you. Many direct insurance carriers will use those savings to spend more on marketing their brand and product. Without the benefit of local agents marketing for them, direct carriers may need to spend a bit extra to create awareness for their brand. In addition, pricing algorithms of car insurance policies are extremely dynamic and, as a result, there will be a large range in price for any single individual.
3. If your friend borrows your car, then your vehicle is not covered against damages.
In most cases, this is simply not true. Comprehensive and collision coverage will provide protection against any damages to your vehicle, regardless of the driver. However, if you explicitly excluded this friend from your auto insurance policy, then damages would not be covered.
4. Auto insurance rates automatically go down when you turn 25.
Age is an important variable in pricing models. Like any other variable in the pricing model, age is used to predict the likelihood that the insured will make a claim. While people under 25 are statistically more likely to get into an accident, each company handles the impact of age on the price of the policy differently. There is no hard and fast rule that once you turn 25, the price of your car insurance will decrease. Some carriers may offer a pricing break at 21, 23, or 30. There are a variety of other ways to receive discounts on your policy such as bundling a Homeowners or Renters policy with your auto coverage, paying your premium in full, or even choosing to receive paperless billing. It is important to check with each insurer on discounts you can qualify for when shopping for a new policy.
5. Comprehensive coverage covers theft of your vehicle and all items contained within.
Comprehensive coverage on your auto insurance policy only covers items physically attached to your vehicle. This may include your car stereo or GPS device if it is factory installed. For coverage on items contained in your car such as iPods, clothing, and compact discs you will need Homeowners or Renters coverage.
The Ins and Outs of Flood Insurance
“I’m not in a flood zone, so I don’t need flood insurance.”
I can’t tell you how many times I’ve heard that. Each time my reply is: “Well, that’s not exactly true.”
Most of the country is in some kind of a flood zone, a designation that indicates the area’s risk of flooding – some are just more severe than others. So, what does that mean for you as a homeowner? It means you are at risk of flooding, even if it hasn’t happened in your area in recent memory. And, it also means that you may want to consider buying flood insurance.
Here are five important things to know about a policy for flood coverage:
- It’s a separate policy. The typical homeowners insurance policy does not offer any coverage for flooding. None. But, you can likely purchase a separate flood policy through the National Flood Insurance Program. A few carriers in Florida also offer private flood insurance as an alternative. Your independent agent can help you find coverage in your area.
- Different flood zones have different flood insurance costs. The zone in which you reside will help determine your flood insurance costs, along with other factors. And, yes, the more severe the flood zone, the higher your insurance rates may be.
- Your lender may require it. If you purchase a house in one of the more severe flood zones, your lender will likely require you to carry flood insurance as a condition of your loan. If you purchase the home with cash or pay off your mortgage, it will be up to you whether or not you carry the coverage. Just be sure to discuss any major insurance changes with an independent agent first.
- Flood insurance is not just for coastal areas. Take, for example, the flooding just this year in West Virginia, Texas and Tennessee. It all goes to show that even if you don’t live near the coast, a flood could still devastate your area – and your home.
- What your policy covers will depend on the policy itself. Most people who buy flood insurance want dwelling and contents coverage. Be sure you understand what you’re buying and how much coverage you’ll have. An independent agent can help.
Keep in mind that the Federal Emergency Management Agency (FEMA) periodically updates its flood zone maps. Even if you have flood insurance now, you may want to check whether it is still insuring you at the level you want. If you don’t have flood insurance and you think you could benefit from it, be sure to contact an independent insurance agent. Because flooding isn’t just a Florida thing.
Securing Your Important Documents and Treasures
Fall is about to arrive, so it is time for a little fall cleaning. While your cleaning out the closets and organizing the junk drawer, don't forget to revisit the important documents and other items you have in your home safe and/or safe-deposit box at the bank.
What documents do you need to keep? What can your shred? Are your valuable items properly secured?
Wait, what’s that? You don’t have a home safe? Or a safe-deposit box? Well, let’s look at why you may want to get one – or both – and what to keep inside.
Home Safes
Oftentimes these are well suited for safeguarding important documents and valuable things you access somewhat regularly, such as jewelry or watches. Keep in mind that while residential safes help protect against fire and theft, they often aren’t as robust as commercial models. For the best protection in a home safe, select a model that is heavy enough that a burglar couldn’t make off with it, and consider bolting it to the floor. Here are some of the things you may want to keep inside:
- Insurance policies and your agent’s contact information.
- Passports, original birth certificates and Social Security cards.
- Photocopies of passports, credit cards and driver’s licenses, in case they are ever lost or stolen from your purse or wallet.
- Tax documents and tax returns, from the past six to seven years.
- A list of your family’s medical information and contacts, including doctors, pharmacies and medications.
- Investment and banking documents, including billing contact information, as well as emergency cash.
- Heirloom and other valuable jewelry and watches.
- Wills and other important legal documents, including wills that list you as the executor.
- Computer backup disks or drives, or other small electronics you don’t use regularly.
- Safe-deposit box keys.
Safe-Deposit Boxes
Speaking of safe-deposit boxes, are they an old-fashioned notion or something that’s worth your while? To answer that question, U.S. News & World Report recommends gathering everything you might want to store in a safe-deposit box and then determining whether you feel secure enough storing it all at home.
If not, a safe-deposit box may be a better, more secure option. A bank is more heavily guarded than your home, after all – against theft, fire and other disasters.
If you do decide on a safe-deposit box, here’s what you might want to keep in it:
- Originals of key documents, such as property deeds, car titles, etc.
- Valuable collections or family keepsakes that you don’t access very often.
- Pictures or videos from your home inventory to use for insurance purposes.
If not, store these items in your home safe. And, here’s what NOT to put in a safe-deposit box:
- Anything you may need to access quickly, such as passports, powers of attorney documents, etc.
- Cash. Not only will your money not earn interest in a safe-deposit box, it won’t be protected by FDIC insurance, either.
Remember, putting something in your home safe or a safe-deposit box is more secure than stashing it in your sock drawer, but it doesn’t guarantee anything, either. So, think about having document backups, as well as insurance for your valuable items.
After all, if something is valuable enough to lock up, isn’t it valuable enough to insure, too? Talk to your independent agent about your personal property coverage and about scheduling any high-value items, especially expensive jewelry and collectibles, separately.
Whether you’re just getting started in life or retiring and looking to downsize, a condominium is a great way to go.
You don’t have to worry about the yard, yet it’s your own property so you can paint the walls chartreuse and install grow lights for your man-eating plants if it makes you happy.
Because there’s a unit owner, but the common areas and larger building itself are under the control of the association, there are some unique insurance issues you need to be aware of.
Puerto Rico developed the first condominiums in 1948 with the passage of the Horizontal Property Act. Before that time, all owners in a condominium were obligated under each individual mortgage in the complex.
If one owner defaulted on his loan, then the mortgagee could foreclose on the entire condominium complex. Under horizontal property laws, individual ownership is split into horizontal planes that limit the unit owner’s interest to the inside of the unit. (Previously, ownership was seen as all the space from the center of the earth to somewhere in the air.)
This makes condominium ownership desirable, but confusing: If the insured owns only the unit, what about the hallways, outer walls, roof, foundation, plumbing, pipes and electrical? What about common areas? This is where condominiums get complex.
Before you buy, click here to learn the six things you need to know about insuring a condo.
Most homeowners purchase a standard homeowners' insurance policy and rarely take the time to read it after they receive it from their agent.
They may skim it to determine what kind of coverage exists if their contents are lost or stolen, or if their hot water heater leaks, but most don’t give it a thorough review.
The Insurance Information Institute says that homeowners' insurance provides coverage for the structure and contents (personal belongings), and additional living expenses if the home is unlivable because of a covered disaster like a fire, as well as liability protection against lawsuits, damage or injury family members or pets may cause to others.
As a homeowner, you probably think you have a pretty good idea of everything that your insurance policy covers. You might be (pleasantly) surprised to find that the policy actually covers more than just the run-of-the-mill accidents.
Click here to see some examples of other coverages that may be available under your policy. Granted, every policy is different, so make sure to read your policy or talk with your insurance agent to verify what coverage actually exists.
