Archive for the ‘vehicle insurance’ Tag

Motorcycle Insurance – coverage review   Leave a comment

Motorcycle season

It’s motorcycle season!!

Good morning everyone!

For those in Western PA, motorcycle season is very nearly upon us, and if you’re like me, that’s an exciting and gratifying thing indeed.  Four to five very long months of waiting can get rough on us all.

One thing that tends to sit on the backburner is the motorcycle insurance renewal that almost always also comes through at this time.  As such, now is as good a time as any to give a quick run-down on motorcycle coverage and things to consider.

Some of the coverages on a motorcycle policy will mirror those on your auto policy – bodily injury and property damage liability are good examples.  Liability coverage pays for the medical expenses and damages others suffer, for which you are responsible (in an accident).

Uninsured & underinsured medical provides coverage for you and your passenger’s medical expenses in the event of an accident where someone else is at fault and either doesn’t have sufficient coverage, or any insurance at all, to pay for your bills.  And, of course, you can buy physical damage coverage on your motorcycle itself if it’s stolen or damaged.

Beyond that, though, is where the differences start to appear.  For example, many first party benefits coverages either are unavailable or very expensive to obtain.  These coverages provide protection for you in the event that you are injured in an at-fault accident for things like medical bills, lost income, or funeral expenses.

Roadside assistance and/or trip interruption can function differently on a motorcycle policy – depending on the company you go to, you can get coverage for a flatbed tow (not typically available on regular auto policies) or other motorcycle-specific services.  On occasion, you can even get coverage for unexpected expenses resulting from an accident or breakdown – such as the cost of staying in a hotel.

There is also more readily available coverage for accessories and “carried” contents on your bike.  Several insurance companies provide a small amount of accessory coverage automatically when you buy physical damage coverage on your bike.

If you have done a great deal of modification, have an antique or custom bike, make sure to go over the best way to properly insure your baby – otherwise, you might be in a position where you have to cover most of the cost of those same mods out of pocket in the event of a claim. 

One final thing to consider – keep your safety courses up to date (within the past three years).  This will you provide you with a moderate to major discount on your coverage, and is a great refresher for those safety skills you learned years ago.  For Pennsylvania riders, head to the PA MSF website to find and schedule a class.

Shameless plug – as a licensed rider & Harley owner who is registered to provide motorcycle coverage through multiple insurance companies (like Rider, Progressive, AIC, and more!), I am excited to work with you to provide competitive quotes.  We can re-evaluate your coverage, and potentially get you better coverage for less money.  Do business with someone who knows and understands the passion and dangers involved so you can ride with peace of mind.  The quoting process takes approximately 15-20 minutes.  Please complete the following form, and I will get in touch with you soon to begin the process. 

Winter weather tips – damage & injury prevention   1 comment

Good afternoon!  Seeing as how the Pittsburgh area is forecast to experience record low temperatures tomorrow & Friday, I thought I would put together a short blog with links for useful tips to prevent damage to your home and to keep yourself & your pets from getting injured.

Winter

Cold temperatures coming soon!

Hope you find the information useful!

Prevent freezing pipes

Pre-storm preparations

Things to do during a storm

Post-storm damage prevention & maintenance

All-around maintenance and preparation ideas

Tips to protect yourself when outside in cold weather

Good resource with multiple links & other info

Pittsburgh Winter

The Insurance Dogger doesn’t seem to mind the cold!

Driverless cars – insurance for the future?   Leave a comment

Sammy driving

The Insurance Dogger isn’t sure if she’s ready to jump out of the driver’s seat just yet!

As you may have noticed, there is a lot of news coming out lately about driverless cars – Google is one of the main players in the field,  but Carnegie Mellon University made a big splash locally and nationally when it unveiled a very successful test-drive in the Cranberry area nearly two years ago.  A lot has been written in the last couple years about the various pros & cons of driverless cars, so I won’t rehash them here – a simple Google search will reveal just about anything you’ve ever wanted to know about the future of driverless vehicles.

However, as an insurance agent, one of the first things that comes to mind whenever the topic comes up is, how will the insurance policy, and the liability coverage in particular, function when it comes to insuring driverless vehicles?  This is not an easy question to answer, as there are many facets to consider, and much of it is based on speculation because the technology has not put forth a viable “ready for the public” option yet.

There are several legal considerations that, for the most part, I will set aside for now – primarily for the sake of expediency.  One of the big issues at hand is that, generally, each state has autonomy over how insurance laws & coverages are mandated.   I will address issues as broadly as possible, but the situation is still largely theoretical and developing as the technology progresses.

From an insurance standpoint, one of the largest liability concerns is the question of who is at fault (“liable”) when a driverless car is involved in an accident – is it the “driver” of the vehicle?  The engineering firm that put together the software operating the vehicle?  The manufacturer of the vehicle?  All of the above?  This is not an easy question to address, and seems to generate more questions than answers.  Was there an error in the software?  Was the driver able to manually override the vehicle and didn’t?  Did the steering system or brakes fail to receive or comprehend the instructions the software passed along?  Some of these questions will sort themselves out as the technology becomes more “concrete” and less speculative.  But the truth is, I fear, legal liability concerns will not actually be resolved until after the rubber hits the road and accidents occur.

Another concern along those lines is who is responsible for damages to the driverless car itself if it is responsible for an accident in which it gets damaged?  As above, should the software design firm pay for your damages?  The car company?  Are you responsible, as the owner of the vehicle?

A bit more disconcerting – what if your vehicle’s software is hacked?  If the vehicle is dependent upon mobile maps & directions to get from point A to point B, what if mobile/cellular service is lost?  How will the vehicles navigate, and in particular, how will it respond to the ever-changing conditions of roads and construction, closures, traffic, etc?

Lloyd’s of London published a market-watch article (along with its far more lengthy corporate report) about some of these very issues.  While the article isn’t conclusive, it does provide some key insights into considerations and factors at hand: “liability will be a key issue because autonomous and unmanned vehicles involve the transfer of control from direct human input to automated or remote control.  ‘In many cases the technology is there to create fully autonomous vehicles, but the legal and regulatory environment needs to be developed further, and public trust will also need to be fostered,’ says Maran.”

One thought I see being repeated consistently is that, ultimately, the increased safety offered by autonomous vehicles will rapidly outweigh the legal and insurance liability concerns: “Many of the routine claims that currently drive the cost of motor insurance will reduce or almost disappear entirely, explains Powell. The resulting decreased exposure for insurers would probably require underwriters to change the design and pricing of motor insurance products, he says.”

At the end of the day, because the technology is a relatively long way off, the “problems” of insuring driverless cars still bring up more questions than answers.  Regardless of the characteristics of the final product, the technology is coming, and the insurance companies that are able to quickly analyze and adapt to the new risks will be a huge step ahead of their competitors.

Some additional resources, reading, and even some videos to watch:

Insurance Information Institute study, Feb 2015

Wall Street Journal article, August 2014

Auto Insurance Center (undated)

CNBC / AllState CEO, Jan 2015

CNET / YouTube – great review of pros & cons of self-driving cars

Google self-driving car – A First Drive

Wall Street Journal YouTube article

CMU driverless car driven around Pittsburgh

Bill Shuster rides in driverless car

 

A review of personal insurance – Auto insurance (physical damage)   3 comments

Dog Blog

I’ve been waiting for a little while now….

OK OK I know that I said I’d be back to finish up auto coverages a few days ago.  Business being what it is, it’s taken me a little while.  But here we are, and off we go!

Last week we reviewed liability and injury coverages.  This week, we are going to review the coverages in place to protect the damages to your vehicle itself and ways to save on them.

  • Collision  – Even though this is “backwards” from how the coverages appear on your policy, it’s easier to explain starting with Collision.  Collision provides coverage for your vehicle when it collides with some other inanimate object, or is hit by another moving vehicle.  In the state of PA, unfortunately, that includes when your car is hit by a shopping cart.  Some examples of collision claims:  if your car is parked and gets hit by another car (or shopping cart!), you hit a patch of black ice and slam into a tree, or you are at fault in a multi-vehicle accident.  Ways to save – see note after Comprehensive
  • Comprehensive (Comp) – Comprehensive is most easily explained as “all other covered forms of physical damage to your vehicle,” hence the name.  In PA, comprehensive coverage does pick up one type of accident that would otherwise be considered a collision – hitting an animal or pedestrian.  These damages would be covered by comprehensive.  Other examples of comp claims:  if your car is stolen, catches on fire, suffers flood damage, a tree falls on it, etc.  Windshield and other glass damage is covered by comp (unless caused by a non-animal collision).  Ways to save – Easiest and most common way to save is by increasing your deductible.  Be wary of two things, though – first is that collision is far more expensive than comp, so it’s far more effective to increase your collision deductible.  Second is that you should be aware that the savings by increasing the deductible will not offset (in one year) the increased out of pocket cost in the event of a claim.
  • Comp or collision pay for a total loss of the vehicle based on the depreciated (Blue Book) value of the car.  All other (partial) losses are paid based on the actual expense of repairs (less the deductible).
  • Rental Reimbursement (RR) – RR provides coverage if you need to pay for a rental car as a result of a covered comp or collision claim.  In other words: you have a covered claim.  Your vehicle will be in the shop for two weeks.  You need a car in the interim.  You pay for a rental vehicle.  RR coverage will reimburse you for the cost, up to specified daily limits and maximum duration (typically, $30 a day for 30 days).  Ways to save – only real way to save here, outside of not purchasing it at all, is to carry lower per day limits.
  • Towing & Labor (T&L) – T&L provides coverage in the event that you need some form of roadside assistance (change a flat tire, charge a dead battery, keys locked in your car) or need to be towed for virtually any reason (mechanical breakdown, run out of gas, etc).  No real way to save here, it’s generally very inexpensive to begin with.  Only thing to consider – if you are paying for this AND AAA or some similar road service, be aware you may be paying twice for the same coverage.
  • Gap Coverage – This provides coverage for new cars that are purchased using a car loan.  As noted above, in the event of a total loss to your car, the policy will only pay for the depreciated value of the vehicle, NOT the loan amount.  Typically, the loan amount is higher than the depreciated value, creating a “gap” in coverage.  Gap coverage fills the void by paying for the difference.  This coverage can be purchased through the dealership or on your auto policy.  Compare BOTH terms and pricing before choosing where to buy the coverage!

That about does it for this review.  There are other liability and physical damage coverages available, but these are by far the most common (at least in PA).

Relax

So just relax and enjoy the ride – knowing you are well covered!

What the Hail?!   Leave a comment

Hail

Wow! Thank goodness we didn’t see anything the size of these babies!

Some timely advice for local Pittsburghers who endured the relatively uncommon pelting of hail yesterday:

Worried about hail damage? Don’t be!

– Virtually every building (home or business) policy includes coverage for hail damage, even if you have a named perils policy.
– Same for auto policies – if you carry comprehensive, you have coverage for hail damage.
– If you are concerned about hail damage on the roof of your building – DON’T get up there to check it yourself! Hire a professional.  Also, make sure its either someone you trust, or is reputable and in good standing in the BBB or Angies List.

It wouldn’t be a bad idea to be present for the inspection. Sadly, some of the less-reputable “contractors” will go onto people’s roofs with a ballpeen hammer and create some “hail damage” of there own to get some quick and easy repair work.

In addition, if you have a chip in your windshield, get it fixed now before it becomes a crack!  If you carry comprehensive on your auto policy, and the chip is about the size of a quarter, most policies will pay for the repair with no cost to you.  Once it turns into a full blown crack, and it needs to be replaced, then you would pay your comp deductible and the company pays the balance.
Other questions or concerns? Talk to your agent!

(Photos courtesy of Hail Events & Scott Blair)

Windshield

Probably going to need replaced….

Windshield

Another probable replacement…..

4 ways NOT to save on your insurance (and what you should’ve done) – Part 4 (Severity)   2 comments

Insurance Claim

Sammy attempts to demonstrate a major claim

This week Sammy and I are going to finish up our discussion on how your claims history affects the premium you pay for your insurance policies.  As you may recall, last week we discussed how the number of claims that you file can drive up your premium.  This week, we are going to discuss how the severity (ie – total dollar value) of individual claims affects your premium.

Just a quick search on Google   and you will find there is a lot of information out there about severe (major) insurance claims – the top causes of major homeowner’s claims, other blogs about major insurance claims, and even a website that lists the top 10 biggest insurance claims ever.  When reviewing a large claim, especially in light of your future premiums, companies will generally consider a couple factors.

  • Cause – I’ll make this as simple as possible.  In the event of a large claim, the cause of the claim can be a factor that is considered with regard to premium change – although, this primarily applies to business insurance.  Basically, if you have a large claim, but it’s not something that would be considered “your fault” (ie – a weather claim, an uninsured driver hits you),your agent can make an argument with the underwriter that this large claim was something outside of your control and not easily prevented.  It’s not always successful, but it’s still worth having a discussion.
  • Prior Claims – This ties into cause, in a way.  If you have a large claim, but no prior claims, your agent can again make an argument that this was a one-time event that could happen to anyone, especially if you were not at fault.  It’s definitely not always going to be successful, but it helps.  However, if you have a couple prior claims, regardless of size, it makes it much more likely that you will see a premium increase (or potentially a non-renewal notice) upon expiration of your current term.
  • Loss Ratio – Loss ratio is the calculation a company makes to determine your “net” expense to them.  The most simple calculation takes the total dollar amount paid on every claim you’ve ever had while insured with that company (for THAT particular line of coverage – auto, home, etc), and divides it by the total amount of premium you’ve paid while insured with them (again, for THAT line of coverage).  For example, let’s say you had a $1,000 claim and a $45,000 claim.  You’ve been insured with the company for 25 years, and paid $23,000 of premium.  Your loss ratio calculation would be $45,000 + $1,000 = $46,000, divided by $23,000. $46,000/$23,000 = 2, or 200%.  Another example – the company paid out $8,000 in claims, and you’ve paid in $16,000 in premium.  $8,000/$16,000 = .5, or 50%.   Obviously, the higher your loss ratio is, the more likely it is your premium goes up.  This is one argument for having longevity with a company – the longer you stay, the lower your loss ratio will be – and thus, the greater chance that a loss, even a large one, will not have a dramatic effect on your premium.

One last thought – claim history is something which “travels” with you.  Similar to your driving record with the DMV or your credit score, ALL insurance companies provide claims information with a central database.  When you change insurance companies, the new insurance company will contact the central database and have access to basic information about all of the prior claims that were filed.

In summary – two different factors are the biggest influence on how your claims history can affect your annual premium – frequency and severity.  Obviously, the more that you do to reduce those two factors, the more favorable your insurance premiums will be!  I’ll stress filing numerous small claims – the more small claims that you file, the less flexibility there will be in the pricing of your coverage.

A little dry these last two weeks, but I hope it helps you to understand how insurance works!

insurance blog

Man, I’m worn out! That’s a lot of info

4 ways NOT to save on your insurance (and what you SHOULD have done) – part 4 (Frequency)   1 comment

Insurance Claim

Sammy attempts to demonstrate a minor claim

The fourth & final installment of our 4 ways not to save thread may ruffle your fur a little bit.  Keep in mind while reading that it’s simply a different perspective to consider.  We are going to address the issue of whether or not you should file an insurance claim.

There are quite a few websites that offer thoughts to consider, especially when it comes to whether you should file a claim on your auto insurance policy.  Truth be told, there are scant few solid answers that apply to every situation.  99% of the time, it’s ultimately going to end up being a (hopefully) well-educated decision.  Oftentimes, personal preference also plays a significant role.

Agents are always asked “If I file this claim, will my rates go up?”   As I said above, there’s hardly ever a concrete answer that’s going to apply in every situation – it’s heavily circumstance-dependent.  If you ask your agent this question, you are often going to receive the answer, “Well, maybe….  If thus & so happens, then …..”

Insurance rates are a very complicated calculation, and do not simply involve whether or not you’ve ever filed claims before.  I’ve addressed this very briefly, only glancing across the surface of the issue.  That being said, your claim history IS a major factor behind how much (or little) you are paying for your insurance coverage.

Your claim history is based on two different factors, from a premium perspective – frequency and severity.

This post is going to address frequency.  I will write a short post early next week to address severity.

Frequency of claims is something that insurance companies keep a close eye on.  With regard to auto insurance, companies often have very specific measurements they follow, monitoring things like claims frequency and your driving record (speeding tickets & other violations).  Obviously, the higher the number of claims & violations, the more likely it will be that you will either A) be paying more for your coverage, or B) not be able to obtain insurance with a desirable company.  This happened to a person I was obtaining quotes for recently.  They had not ever had any major claims, and only had one violation.  However, in the past two years, they had filed four separate, small (under $1000 each) claims.  As a result, I had a very limited number of companies I could obtain quotes from, and they ended up paying a substantial amount for coverage.

Similarly, companies watch the frequency of claims on policies like home owners or business/commercial propertyFiling multiple claims is something that will often drive your premium up – in essence, the company views you as more at risk of having at least one claim in a given year.  This is one of the reason that the rates for coverage with a higher deductible are often substantially lower (as I briefly addressed in part one of this series) – if you have a higher deductible, it significantly reduces the frequency of claims.  Unfortunately, even if you had no control over the cause of loss (IE – a windstorm or lightning strike caused damage), if you file a number of claims, your premium will in all likelihood go up.

If you are in a claim situation, I would recommend that you pull together all the applicable information – date, circumstances, item(s) damaged, estimates for repair/replacement, etc – then contact your agent.  Your agent will review the data about the loss, your personal claims history, and the guidelines of your insurance company.  They will be able to offer you thoughts & suggestions, but as I said about, in most cases, you are going to have to make an educated decision about how you want to proceed.

That’s all for this week – we are going to review severity shortly!

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