Let’s take a look at the two different scenarios:
- If the insurance follows the car and you lend your car to a friend, your coverage is considered the primary coverage. If your friend has an accident, it’s your insurance that will pay the claim. If the accident is serious enough to use up all of your policy’s coverage, then your friend’s coverage, which is considered secondary, might also be used.
- If the insurance follows the driver, coverage is provided the other way around. If you lend your car to a friend and they have an accident, it’s their policy that is considered primary coverage, meaning their insurance company will pay the claim. In this case, your policy would be secondary and wouldn’t pay for anything unless your friend’s policy limits were used up.
Remember these two things: First, always exercise caution when it comes to lending your car. Second, if you’re ever in doubt about whether you or another driver is covered in any given situation, please call us.
Caution: Recently, many rental companies have included a “diminution of value” clause in their rental contracts. These clauses state that the renter is responsible for any diminution of value charges resulting from a loss incurred to their rental vehicle while it is rented to you. In other words, if your rental vehicle is damaged to the point where the value is diminished, or at the sole discretion of the rental agency, the agency feels that the vehicle is no longer road worthy as part of their rental fleet, you may be charged the difference between the actual amount of damage incurred and the diminished value of the vehicle. Most personal auto policies DO NOT cover diminution of value nor do most credit card companies used to secure your rental agreement. What does this mean? You could possibly be charged hundreds if not thousands of dollars over the amount your insurance company may pay for the damage to a rented vehicle in your care, regardless if you were at fault for those damages.
Please give us a call before you leave for your “fun in the sun and/or snow” to confirm your coverage and for further details regarding this matter.
- Stop at once. Never leave the scene of even a MINOR accident. Do not block the roadway if at all possible.
- Seek medical assistance and summon police.
- Do not admit fault. Do not comment about the accident to anyone but your insurance representative and the police. Never accept or make an offer of cash, check or “private” settlement.
- Gather accident information. Note the date and time of the accident.
- Obtain information on the other driver including: name, address, phone number, make of car, vehicle license number, insurance company and agent’s name and telephone number.
- Record a description of what happened.
- Draw a diagram of the accident showing the direction of both cars and the point of the accident. Include street names and location of traffic signs/signals.
- Report the accident promptly to your insurance agent.
If a cell phone is stolen from your car (or along with your car if it is stolen), is the phone covered by your auto insurance?
No, it’s not unless the phone is permanently installed and powered by the car’s electrical system. Since most cell phones are now digital and are portable (carried in your pocket or purse), it is unlikely that coverage for your phone will be provided by your auto policy.
Is your portable cell phone covered by your homeowners or renters insurance?
Sometimes it is, but coverage is subject to the policy provisions and deductible in your homeowners or renters policy.
Can you buy broader coverage for your portable cell phone?
Yes, most companies offer a special, broader coverage for portable cell phones that can be added to a homeowners or renters policy. Call us for details.
What if you lease a portable cell phone?
If you lease a phone, check with the company you lease the phone from to see what (if any) coverage they may provide. You may then want to check with us to compare coverages and cost.
Ordinarily, your comprehensive and collision coverages provide you with up to the actual cash value (the vehicle’s cost minus depreciation) in the event of a total loss. When you sign a lease or loan agreement, you may be obligating yourself to an amount higher than the vehicle’s actual cash value.
At a cost of approximately 5% of your current comprehensive and collision premiums, LLG Coverage protects you from out-of-pocket expense when such a “gap” occurs. Although there are some limitations (such as a percentage cap on the amount of gap coverage provided) LLG Coverage may pay up to your lease or loan amount if your car is stolen or if the cost of repairs is greater than its salvage value. Contact our office and we’d be happy to discuss this coverage further.
Note: Some car manufacturers may provide gap coverage as part of the lease agreement — check your particular contract for details.
Vehicle Size – Quite simply, bigger means safer. According to the shopping guide, “People in small vehicles are injured more often and more severely than those in large vehicles.” In relation to their number on the road, small vehicles account for more than twice as many occupant deaths as large vehicles. Small sport utility vehicles have the highest death rates of all, in part because of their greater involvement in fatal rollover crashes. “While utility vehicles and passenger vans might go head-to-head in a popularity contest, passenger vans have good on-the-road crash experience — similar to that of station wagons.”
Air Bags – Serving as a buffer between vehicle interiors and occupants’ heads and faces, air bags provide automatic protection in frontal crashes. The Institute advises that although “the speed and force of air bag inflation may occassionally cause minor injuries such as abrasions, this slight risk is far outweighed by the benfits.” This type of injury can be reduced by selecting a seat position that is not too close to the steering wheel.
Safety Belts – Remember, the more comfortable the safety belt, the more likely you are to always use it. Even though shoulder belts allow some forward movement, automatic crash tensioners and/or belt webbing grabbers can reduce the chance of an occupant hitting the steering wheel or dashboard in a serious frontal crash.
Antilock Brakes – Especially designed to avoid skidding and loss of control, antilock brakes automatically pump several times a second. Drivers need to become familiar with the difference in braking style as antilocks require heavy braking pressure to activate this safety feature.
Head Restraints – Required in front seats of all new passenger vehicles, head restraints prevent occupants’ heads from snapping back in a rear-end crash. Look for a fixed head restraint or an adjustable restraint that is designed to protect tall and short people even in the “down” position. Avoid a poorly-designed adjustable restraint that would only protect the shortest occupants.
Built-in Child Seats – Several cars and vans offer built-in child safety seats as options.
This is where your Uninsured Motorists (UM) Coverage comes into play.
What is the difference between UNinsured and UNDERinsured Motorist Coverage?
UNDERinsured Motorists Coverage covers you and passengers in your car for “losses unpaid because sufficient bodily injury liability limits were not available from the policy of an at-fault driver. In other words, UNinsured Motorist covers you if the wrongdoer has no insurance while UNDERinsured Motorist covers you in the event that the wrongdoer has some coverage but not enough.
Many people wonder if UM is really necessary. After all, isn’t liability insurance mandatory? How can there be any uninsured drivers out there? The problem is not everyone obeys the law. The Insurance Information Institute shows on their web site, www.iii.org, that an estimated 12% of drivers in Georgia in 2007 were uninsured.
Others question the necessity of UM in light of the fact they have very comprehensive medical coverage. In the event of an accident with an uninsured driver, they assume their own medical coverage will fully protect them. Yes, medical insurance would likely cover most medical expenses. But it will not generally compensate the injured person for lost wages, disfigurement, pain and suffering, mental anguish, and changes in quality of life. For a person permanently disabled following an accident, even things such as modifications to make a home and vehicle more accessible can cost tens of thousands of dollars. UM can compensate the victim in these broader areas.
There are ways insurance dollars can be saved, but paring down or going without UM is one way we strongly discourage.
Underinsured Motorist Property Damage Coverage
It is estimated that one out of every 20 motorists is driving uninsured. Although this figure represents only 5% of today’s drivers, uninsured motorists are responsible for approximately 13% of all auto accidents. If you become involved in an accident with an at-fault driver of an uninsured motor vehicle there are coverage options available to ensure that you are adequately protected:
- UMBI – Uninsured Motorist Bodily Injury Coverage provides bodily injury coverage for you and for the occupants of your vehicle. Most policies already provide this coverage.
- UMPD – Uninsured Motorist Property Damage provides coverage for your vehicle. Vehicles without collision coverage have no protection for damage resulting from an accident with an uninsured driver. If the optional UMPD coverage is added to your policy and you find yourself tangled in an accident with the at-fault driver having no insurance, you won’t be left to pay for the damage to your car out of your own pocket.
Since the policy specifically refers to windstorm as a covered cause of loss, some residents have wondered what exactly windstorm includes. Tornadoes, hurricanes, high winds, thunderstorms and blizzards are all included in the definition of windstorm. Your homeowners policy also provides “loss of use” benefits to cover additional living expenses while repairs are being made to your home.
Please call us with any specific questions regarding your property coverage. We are always happy to review your current coverage needs.
Your homowners insurance policy gives you liability protection for bodily injury and property damage to others in non-business activities, like a child who is injured when you are the volunteer soccer coach or 4-H advisor. On the other hand, no protection is provided if your volunteer activity is related to a business (chamber volunteer, union, trade or professional association representative, etc.) or if you receive any compensation. Any legal action other than bodily injury and property damage is not covered (an exception: some homeowners policies cover personal injury — libel, slander, false arrest, false imprisonment, etc.)
Also check for coverage under the organization’s policy. Ask the organization leader for proof of insurance for general liability, directors and officers liability, and employment practices liability. Also check to see if volunteers are covered (named as additional insureds) under those policies. Some other potential loss situations could include:
- Failure to examine documents signed
- Silence with respect to improper conduct of fellow officials
- Improper rejection of bids
- Failure to exercise diligence in management
- Incurring unnecessary expenses
Communities are fortunate to have so many volunteers donating their time in a host of different areas. This discussion is not meant to discourage any present or prospective volunteers. Rather, our intent is to help individuals be well-informed, comfortable and adequately protected when it comes to volunteering.
Flood – Since flood damage is excluded under your homeowners coverage, you should be aware that flood insurance is available from the National Flood Insurance Program. Most Ohio communities have qualified for the program that provides coverage for surface flood entry. Structural and contents protection are offered. Coverage is subject to a deductible.
Sewer Back-up – This endorsement provides protection for direct loss caused by water that backs up through sewers, drains or sump pump wells. Just as flood insurance excludes coverage for sewer back-up, this endorsement excludes any coverage for damage due to flooding. Coverage is subject to a deductible.
Earthquake – Coverage is available with the premium determined by the structure of your home or building. Because it will better withstand an earthquake, a frame structure is less to insure than a masonry one. A substantial deductible (often a percentage of the amount of insurance that applies to the destroyed or damaged property) is in effect.
For clarification of your current policy or information regarding the above coverages, please contact us. We welcome the opportunity to evaluate your present needs and to discuss possible insurance improvements for you and your family.
Are you covered?
- While caring for a child for a fee, the child is injured in your home. The parents expect you to cover the hospital bills.
- You replace your friend’s car brakes for a “few bucks” and the car is damaged or your friend is hurt in some way. He expects compensation.
- A friend slips on an icy walk or trips on a toy while picking up the craft item she paid you to make. She expects you to cover medical bills.
- You use your detached garage for a small woodworking business and the garage is damaged in a windstorm. You want your garage rebuilt.
- You do word processing for a fee from your home. Your computer is stolen. You want it replaced.
- You are a self-employed sales representative with an office in the home. While entertaining a client in your home, the client is injured and expects compensation.
- Your employer may cover it if your business is conducted on behalf of your employer.
- A business insurance policy may be purchased to cover it.
- Your home insurance policy can sometimes be broadened to cover it.
Smoke alarms – Check your policy or contact us to see that you are recieving a discount. If you don’t have alarms, get them. Not just for the discount, but for your family’s safety.
Higher deductibles – The standard deductible today is $500. If yours is lower, you are paying an added charge. If you choose a $750 or higher deductible, more savings are available.
Delete unneeded coverage – Review your policy. There may be jewelry listed that has since been sold, endorsements for businesses in the home that are no longer in operation or other unnecessary coverages.
Central station alarms – Fire and burglary alarm systems that automatically dial a central station can provide both good security and significant premium savings.
Combine home & auto insurance with one company – Companies often offer a discount on the home and auto insurance or both when carried by the same insurer.
In addition to these money-saving tips, some companies offer discounts if you have fire extinguishers, deadbolt locks or a loss-free record. Check with us to see if your plan offers any of these options.
Remember under insuring is not a recommended way to save premium as it can lead to serious problems settling a claim. Whether it’s a question about cost or coverage, we’re always willing to review any insurance concerns with you. Please call us.
You don’t have a riding mower or pond you say? Optional endorsements can broaden a homeowners policy so that it also covers other personal property lost due to extraordinary situations. Consider these other losses:
- Lost jewelry or gemstones falling out of jewelry not specifically insured (subject to a policy dollar limit)
- Loss in value when a gemstone is scratched or cracked (subject to a policy dollar limit).
- Cameras or other personal items falling overboard from a boat or capsized canoe.
- A hot iron falling on and scorching an area rug.
- A deer crashing through a sliding glass door causing extensive damage to the household contents as it struggles to deal with the unfamiliar surrounds of a family room.
- Raccoon damage (rodents and vermin are not covered).
- Lost hearing aids, eyeglasses, telescopes, cameras, etc.
- Spillage of paint, India ink, nail polish, acid, bleach, and other chemicals that damage household contents.
An Umbrella Policy is designed to give you peace of mind from this concern. It adds one million dollars (or multiples of $1 million) of protection to the liability limits of your home and auto insurance policy.* Should a judgment against you exceed the limits of that policy, the umbrella picks up the unpaid portion up to the umbrella policy limit.
Persons most likely to purchase an umbrella policy are:
- Likely “targets” for a large lawsuit — professionals, business owners, property owners, higher income individuals, etc.
- Those who want greater peace of mind knowing that their life savings will be protected from a financially devastating lawsuit.
*The umbrella can also increase the liability limit for your boat, rental property, motor home, recreational vehicle, motorcycle, vacation home and others.
Funds spent on fraud detection are a good investment. According to the National Insurance Crime Bureau, the property/casualty industry is recovering $3.50 for every $1.00 it invests in detecting fraud.
If you want to report insurance fraud, call our office. You can also contact the National Insurance Crime Bureau at the number shown below. Be a fraud buster. We can all help fight insurance fraud.
NICB Fraud Hot-Line: 1-800-TEL NICB
You can get answers to your questions and a quote for insurance while you are away.