Posts Tagged ‘Need’
Do I need full coverage insurance if I get in-house car financing?
February 3rd, 2012
Question by alexthegreywolfe: Do I need full coverage insurance if I get in-house car financing?
I have no credit and I think in-house car financing is the only way I can get a loan for a cheap car (I’m looking for something up to $ 3000).
Is full coverage car insurance mandatory if I get in-house car financing?
Best answer:
Answer by aneurodoc125
If by in-house, you mean through the dealer, probably yes. He needs to be sure he will be paid for the automobile if you go out and demolish it in a week. You would be foolish not to carry medical and liability. A judgement against you for injuries to someone else can literally ruin your life. If you ever make any money, it goes to pay the judgement.
What do you think? Answer below!
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i need renters insurance that will cover my german shepard?
February 1st, 2012
Question by trishee h: i need renters insurance that will cover my german shepard?
My landlords homeowners insurance will not renew his policy because i have a german shepard. I have heard that that there is renters insurance that I can purchase that would include canine liability coverage, but I can’t find one. Any suggestions? I live in MA.
Best answer:
Answer by Luvsdard
Contact any Independent Agent in the Yellow Pages under Insurance in the phone book. You’ll find one.
Give your answer to this question below!
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7 things you need to know about distracted driving
January 26th, 2012
Nick DiUlio
Most of us have had the urge on more than one occasion. It’s the “need” to respond to a text or answer a call or check email while driving. Well, according to a study published in December 2011 by the National Highway Traffic Safety Administration, it turns out that most of us are giving into this urge — and, oh, what a dangerous urge it is.
In this slideshow, we highlight six findings of the traffic safety agency’s study and tell you one more thing: how distracted driving can affect your auto insurance.
Simply put, most surveyed drivers said they answer incoming calls while driving. When it comes to making calls, only 5 percent said they’d be willing to place calls on all road trips, 10 percent on most trips and 26 percent on some trips.
Two-thirds of the motorists surveyed said they answer and drive, and close to half of those who do said they hold a phone in their hand while driving. Seventeen percent use a hands-free earpiece, 9 percent have a built-in system for answering calls and 17 percent use the cellphone’s speakers.
“This gets to the core of humanity and our need to constantly connect,” says Chuck Cox, senior vice president for Cellcontrol, which makes Bluetooth-enabled technology designed to curb cellphone use behind the wheel. “We expect those connections in the vehicle now as well, and we don’t tolerate it well when those connections are severed.”
Stopping at nothing
According to the survey, there aren’t many situations that prompt drivers to stop using their phones behind the wheel. The primary situation cited (54 percent) was bad weather. About one-fourth said bumper-to-bumper or fast-moving traffic would influence a decision to not place calls or send messages. However, seeing a police officer, driving at night, going through a school zone or having a baby or child in the car probably wouldn’t stop them from using their phones.
“What’s becoming more common is people trying to sort of limit the risk, like only texting at red lights, for example,” says Bob Davis, CEO of Virtual Driver Interactive, which designs systems that simulate driving conditions. “So you can see certain levels of behavior modification, but sadly we’re not stopping altogether.”
Dangers of the written word
Here’s the deal: Young people are texting behind the wheel. A lot.
According to the survey, close to half of motorists under age 25 said they text or email while behind the wheel. Additionally, 70 percent of that group said they send messages while steering. While 56 percent of men and 51 percent of women said bad weather might deter texting behind the wheel, only 5 percent of men and 12 percent of women said they wouldn’t send a text or email under any circumstance while driving.
“The stats are daunting, and they’re probably going to get worse,” says Tasso Roumeliotis, CEO of Safely, whose technology helps prevent cellphone use while driving. “The urge to reply or write a text has almost become an addiction. Teens especially are having a more difficult time resisting the need to reply to these social interactions.”
Does your driving change?
According to the U.S. Department of Transportation, an estimated 3,092 traffic deaths occurred in distraction-related crashes in 2010. Still, the National Highway Traffic Safety Administration study reports that 54 percent of those surveyed said talking on a handheld device doesn’t hurt their driving performance and 25 percent said texting doesn’t have an effect.
Age is a key factor here. Sixty-one percent of those under 24 said talking on a cellphone while driving makes no difference in how they drive.
“There’s a human instinct factor here,” says Roumeliotis, the CEO of Safely. “People know it’s more dangerous because almost everyone has been in that situation where they hit the ‘send’ button and see the car stop abruptly in front of them. They say, ‘Wow, I can’t do that again.’ So you don’t do it for 15 minutes. Then you do it again.”
Perception of safety
Ironically, almost all passengers surveyed — 85 percent of men and 90 percent of women — consider it unsafe when a driver sends or receives a text message or email behind the wheel.
The survey “underlines what we already know: We think using cellphones while driving is unsafe — except for us,” says Anne Marie Hayes, president of the Teens Learn to Drive Foundation. “We think we are better, safer, faster and smarter than everyone else.”
Perception of the law
Nine states and the District of Columbia have passed laws prohibiting the use of cellphones while driving. Moreover, nine out of 10 respondents from all age groups in the National Highway Traffic Safety Administration survey support laws that ban texting while driving, and six of 10 support laws that ban cellphone use while driving. Support is higher (75 percent) among older drivers.
However, according to the Insurance Institute for Highway Safety, these measures have done little to curb the number of motorists using their cellphones behind the wheel.
“We’ve done studies looking at the laws restricting phone use while driving, and we’ve found that the laws have not reduced crashes,” says Russ Rader, a spokesman for nonprofit institute. “Crashes haven’t necessarily increased, but they also haven’t gone down either as laws have been enacted. That’s very curious to us.”
Paying a premium
“If you’re involved in an at-fault accident because you were using a cellphone, it’s just like running a stop light or stop sign and hitting someone,” says Dan Weedin, an insurance and risk management consultant in Seattle. “In the insurance company’s eyes, that’s a high degree of negligence and your policy is probably not going to be renewed.”
In terms of shopping for a new policy after such an accident, Weedin calls the process “brutal.” The wreck will stay on your driving record for three years. During that period, auto insurers either will refuse to provide coverage or will slap you with a sky-high premium because you’re tagged as a high-risk driver.
Troy Anderson
Mold mania swept the United States a decade ago after lawsuits filed by celebrities Ed McMahon, Erin Brockovich and Michael Jordan stoked fears about “killer mold.”
Now, a new threat has emerged – a “house-eating fungus” that can devour homes in months. But the devastating fungus known as poria incrassata pales in comparison to perhaps an even bigger danger – the fact that many home insurance policies now contain caps or other coverage limits on mold and fungus claims.
In a lawsuit that some experts say could have national ramifications, Los Angeles residents Walter and Judy Moore allege that their home insurer, Seattle-based Safeco Insurance Co., acted in bad faith and engaged in unfair competition. The Moores allege that the company initially said it would cover a poria claim, but then backed out after learning it would cost hundreds of thousands of dollars to fix their 1,500-square-foot home. The two-bedroom, two-bathroom Mission Revival home was built in 1924; it sits in a quaint, upper-class neighborhood.
The couple alleges that Safeco told them a $ 10,000 coverage limit applied only to fungus cleanup costs, not to subsequent repairs, but then told them the $ 10,000 limit applied to all losses, including repairs.
A ‘huge insurance scam’?
“This is essentially a huge insurance scam we’ve uncovered where people are not getting what they are paying for,” says Judy, who managed the couple’s rental property in the south of France until they were recently forced to sell it after the fungus invasion. “I know we are not an isolated couple who have somehow had the incredibly bad luck to find out our $ 1 million home is really only insured for $ 10,000.”
Walter, a corporate trial attorney and a former Los Angeles mayoral candidate, alleges in the lawsuit that Safeco failed to disclose on its home insurance declarations, or summary, page the policy limitations for mold or fungus damage. Safeco wrote on its declarations page that the policy would pay hundreds of thousands of dollars — enough to rebuild the home — but an “Additional Property Coverage” provision states the company will pay only up to $ 10,000 for fungus damage and cleanup, Walter alleges.
The lawsuit was filed in February 2011 in Los Angeles Superior Court.
When consumers buy or renew a policy, Safeco sends them a California Residential Property Insurance Disclosure form – showing policy limits valued at hundreds of thousands of dollars. No mention is made of a $ 10,000 limit for any covered losses, Walter alleges.
“There are much broader ramifications for all consumers,” says Walter, a Georgetown University graduate and former editor of the Georgetown Law Journal. “I think if most consumers saw something on their declarations page that the policy limit could be as low as $ 10,000, they would switch insurance companies. You couldn’t replace your car for $ 10,000, much less your home.”
Safeco’s defense
Brenda Harrison, a spokeswoman for Safeco, declines to comment on the Moores’ suit. Safeco is a subsidiary of Liberty Mutual, a Fortune 100 company that’s the country’s fifth-largest property and casualty insurer.
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| Judy Moore stands in the under-repair home she shares with husband Walter. Judy says they’re victims of a “huge insurance scam.” |
Jeffrey Crowe, an attorney for Safeco, explained in court documents that the company investigated this “unusual” case and learned water had entered the house through a vent pipe on the roof that was cut during an earlier remodeling project. This allowed rain to seep behind the walls, permitting the wood-decaying fungus to grow. Safeco later determined the loss wasn’t covered because of the policy’s exclusion for “continuous or repeated seepage or leakage of water.” Although the declarations page didn’t identify the policy’s “Special Provisions” regarding fungus, Crowe says the company covers only as much as $ 10,000 for fungus-related losses.
The case was scheduled to go to trial Jan. 17, 2012, but the judge dropped that trial date. A new trial date hasn’t been set. The Moores have asked the judge to issue an injunction prohibiting Safeco from selling or renewing any home insurance policies in California until it revises its declarations pages and discloses the $ 10,000 fungus limit.
“They know this could do severe damage to them,” Judy says. “If we get a permanent injunction against Safeco that requires them to start telling the truth about what they are selling then there could class-action lawsuits in every state. It would not be, ‘Do you owe people money, but how much do you owe every single one of your policyholders?’”
‘Hideous lack of transparency’
Daniel Schwarcz, an associate law professor at the University of Minnesota Law School who is an expert on home insurance policies, says the Moores’ lawsuit could lead to greater disclosure of exactly what home insurance policies cover.
“There is a hideous lack of transparency about policy coverage, about what companies pay out on and how the process works,” Schwarcz says. “All this information is really hidden from public scrutiny. It’s a real regulatory problem. It’s a problem our courts could fix by forcing insurers to pay claims unless they are really clear to policyholders beforehand about what is covered and what is not.”
The ‘mold rush’
Mold and fungus have been around for centuries and are found everywhere. In the United States, there are more than 100,000 species of fungus. Some species like poria can cause extensive property damage; poria is a soil-inhabiting fungus that has shown up recently in homes in Southern California, Northern California and states along the Gulf Coast.
Other types of fungus can cause health problems ranging from runny noses, coughs and sinusitis to more serious upper respiratory ailments such as asthma and bronchitis. Certain types of mold can produce toxins. The federal Centers for Disease Control and Prevention has found no conclusive evidence that inhalation of these toxins is associated with brain damage, memory loss or a lack of energy – as feared a decade ago during the “killer mold” scare.
Before 2000, the few mold-related claims insurers saw generally were settled for a few thousand dollars. But mold and fungus kicked up a furor a decade ago with multimillion-dollar lawsuits by McMahon and other celebrities, and with headlines like this one from Time magazine — “Beware: Toxic Mold.” In one highly publicized case, a Texas family abandoned their mansion and won a $ 32 million jury award in 2001 against Farmers Insurance. An appeals court later reduced the amount to $ 4 million.
Nationwide, mold-damage payouts soared, more than doubling from $ 1.3 billion in 2001 to nearly $ 3 billion in 2002, according to the Insurance Information Institute. From 1997 to 2002, mold-related claims rose from $ 229 million to $ 589 million in California alone. At the time, traditional home insurance policies did not exclude mold and fungus damage.
Attorneys held mold-damage seminars for homeowners in the early part of this century, says Pete Moraga, a spokesman for the Insurance Information Network of California, a nonprofit group supported by the insurance industry.
“They called it the ‘mold rush,’ ” Moraga says. “ ‘Mold is Gold’ was a name of a seminar showing attorneys how they could make a lot of money on this.”
Mold limits become the norm
After a spike in mold-related lawsuits, many state insurance regulators excluded or limited mold coverage on home insurance policies. Mold contamination is covered under these policies only if it is the result of a covered peril, according to the Insurance Information Institute. A covered peril is a type of risk that an insurance policy covers.
For example, the costs of cleaning up mold caused by water from a burst pipe are covered in most policies because water damage from a burst pipe is a covered peril. But mold caused by water from excessive humidity, condensation or flooding is a maintenance issue for the property owner and is not covered. Every state except Arkansas, New York, North Carolina and Virginia has adopted mold limits for home insurance policies.
“The insurance industry reacted en masse to the Texas verdict and put caps across the board into homeowner’s policies regarding mold,” says Amy Bach, executive director of United Policyholders, a nonprofit advocacy group for insurance consumers. “Then it became a big political issue, and some state legislators intervened when they thought the caps were too low. In some states, you’ll see a $ 5,000 max on mold. Other states have nothing on their books. But the insurance companies almost across the board have limited coverage for mold damage.”
Certain states allow insurers to establish sub-limits — either as a percentage of policy limits or as a fixed dollar amount — for mold cleanup. While some insurance companies prefer to create a total exclusion, others exclude mold but offer an attachment to the policy that makes coverage available at an additional cost.
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| Walter and Judy Moore let their neighbors know what they think of their home insurance company with a handmade sign on a hedge in their front yard. The message, spelled out in large white letters, says “SAFECO SUCKS!” |
As a result of states letting insurers exclude mold as a covered peril, the Insurance Information Institute was unable to figure out how much insurers paid out in recent years for mold claims. However, the institute does track losses caused by freezing and water damage, which includes mold-related claims. From 2005 to 2009, those losses increased from 15 percent of all home insurance losses to 24 percent.
When comparing home insurance coverage, Patricia McConahay, a spokeswoman for the California Department of Insurance, says people should carefully read the policies to determine whether mold claims will be paid. If a consumer has a mold claim, McConahay says, he should submit it to his insurer. If the claim is denied, he should contact his state’s insurance department. The department will investigate to determine whether the claim was wrongly denied, McConahay says.
Reversing course
The Moores, the Los Angeles couple, filed a complaint in February 2011 with the California Department of Insurance against Safeco for undue delay and unfair denial of their claim. The complaint alleges that Safeco denied the couple’s claim twice before finally approving it, but only after a long delay that gave the fungus time to spread throughout the house.
“Before I allowed anyone to tear up our home, I double-checked with the claims adjuster, in writing, that the $ 10,000 amount was for only remediation, and the amount for the repair necessary was not part of this $ 10,000,” Judy says. “The adjuster responded in writing that, yes, the $ 10,000 limit only applied to the remediation part of the claim. He also asked me to get new bids for repair.”
The Moores’ lawsuit alleges Safeco then reversed its decision to avoid the increased repair costs resulting from the delay.
Contractors estimate it will cost $ 350,000 to $ 750,000 to fix the Moores’ home, which was valued at $ 950,000 before the fungus invasion, Walter says.
‘A big case for consumers’
The complaint also asks the California insurance commissioner to require Safeco to provide customers with copies of all insurance documents that “fairly and accurately disclose” what losses are covered. The department has informed the Moores that it will wait until the court case is over before taking any further action.
“I think it’s a big case for consumers,” Walter says. “I’m not a class-action lawyer, but I think some consumer lawyer should jump on this and sue them to recover the difference between the protection homeowners are paying for on the one hand and the protection they are actually getting on the other hand.”
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Homeowner’s Policy (in town) do you need Fire Department coverage?
January 21st, 2012
Question by Ella: Homeowner’s Policy (in town) do you need Fire Department coverage?
I thought that coverage was only necessary on properties outside of city limits. If a fire occurs in town, would there still be a charge from the fire department? I thought there was not and that was included in taxes, etc.
Best answer:
Answer by jlf
That’s not an insurance question – that’s a question for the local fire department or city.
Add your own answer in the comments!
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CCA meeting on need for home insurance set
January 20th, 2012
CCA meeting on need for home insurance set
Do you have enough insurance to protect your manor and your other possessions? On Thursday, Jan. 26, CCA (the Community Civic Association) will hold a meeting on the necessity for Laguna Woods Village owners and renters to have sufficient homeowners …
Read more on OCRegister
Insurance and smoke detectors can save your house
Justin and his wife were renting the home from her grandmother, but didn't know until after the damage was done that they didn't have renters insurance. "it's was just one of those things, where we were going to take care of it next month, …
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Apartments Associations have to be careful in leasing units
Stoller also requires tenants to buy liability insurance and to know the building's move-in and move-out fees and procedures. Owners and tenants are not treated alike. All residents must follow the association's rules. However, as the landlord, …
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Hitting the ski slopes? You may need to equip yourself with season-pass insurance
January 19th, 2012
Brittany Hutson
You’ve been preparing for months to hit the slopes. You’ve got your season pass in hand, and you’ve bought new skis and new skiwear. But then you break your collarbone. You’ll be out of commission — and off the slopes — for a few months.
While you’ll have to skip snow skiing for the season, all hope may not be lost. Many ski resorts now offer season-pass insurance. This insurance protects season-pass holders in case of an unexpected illness, injury or tragedy. Some resorts have done away with issuing season-pass refunds in favor of season-pass insurance.
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| Season-pass insurance could give you a financial lift if you find yourself unable to go skiing. |
This insurance is sold by ski resorts for a percentage (usually about 6 percent) of the total ski-pass price. It’s also available directly from travel insurance company Travel Guard; the cost is $ 20 for adults and $ 10 for children. The insurance is valid for one year or one annual ski season, and provides reimbursement for ski passes up to $ 600 for when a trip is canceled or interrupted.
Among the circumstances when season-pass insurance would kick in are:
• An injury or illness that prevents the insured person from skiing.
• A family member of the insured skier gets injured, becomes sick or dies.
• The main residence of the insured skier becomes uninhabitable because of a natural disaster, vandalism or burglary.
• The insured skier is required to serve on a jury.
• The insured skier loses his job or has to relocate for his job.
• The insured skier must report for military service.
• The insured skier becomes pregnant.
Aspen Skiing Co. operates four ski areas in Colorado — Snowmass, Aspen Mountain, Aspen Highlands and Buttermilk. It’s been offering season-pass insurance since 2003. During the 2010-11 season, nearly 18 percent of season-pass holders bought insurance, says Jeff Hanle, a spokesman for Aspen Skiing. If an Aspen Skiing season-pass holder doesn’t buy the insurance, he’s not eligible for a pass refund.
Resorts that have season-pass insurance generally have strict policies on refunds or don’t provide refunds at all.
“You get many stories or reasons every year as to why each person feels they should get a refund,” Hanle says. “Insurance makes it more black and white. It takes the subjectivity out of the equation.”
If you have season-pass insurance and aren’t able to ski, most properties that offer this type of coverage will prorate the value of your pass to determine the refund amount.
“If a guest has skied a few times and is now unable to use the pass, the guest can file a claim for the unused portion of the pass,” says Janet Janssen, director of property management at Travel Guard. “Each property will determine the value of the ski days used and then determine the unused value of the pass.”
During the 2011-12 ski season, the Ski Maine Association, a trade group, is offering season-pass insurance for the first time. The Travel Guard coverage costs roughly $ 27 if you buy a $ 450 Mountain pass or $ 16 if you buy a $ 250 Sampler pass. Premiums are based on the cost of the ticket.
The Ski Maine Association sells a maximum of 250 season passes each ski season. Season-pass refunds aren’t available without insurance, says Greg Sweetser, executive director of the association.
According to the National Ski Areas Association, a trade group for ski resort owners and operators, season-pass holders accounted for 36 percent of resort visits during the 2010-11 ski season. That was up 2 percent from 2009-10.
Tamara E. Holmes
Think you can maintain your perfect driving record as long as you limit your speeding tickets to other states? Not so fast. Most states not only will share information about traffic violations with your home state, but your home state may even deliver its own punishment.
“You can run but you cannot hide,” says Kevin Lewis, director of driver programs for the American Association of Motor Vehicle Administrators.
And you probably can’t hide that out-of-state ticket from your auto insurance company, either.
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| Generally, you can’t hide from an out-of-state traffic ticket — especially if it’s a serious traffic violation. |
Recognizing that reckless driving can be harmful no matter where it takes place, most states have joined the Driver License Compact. Under this agreement, 45 states and the District of Columbia send information about out-of-state traffic violators to a driver’s home state. Georgia, Massachusetts, Tennessee, Michigan and Wisconsin aren’t members of the compact. However, some of those non-members often exchange information as if they were part of the compact.
Meanwhile, the Nonresident Violator Compact is designed to ensure that drivers don’t return home and leave behind unpaid traffic tickets in other states. Under this arrangement, if an out-of-town driver doesn’t comply with the punishment for a traffic ticket, his or her home state would be alerted and the home state would begin license suspension proceedings. Forty-four states and the District of Columbia are members; only Alaska, California, Montana, Oregon, Michigan and Wisconsin are not.
In the past, neighboring states often would come up with their own agreements for sharing information about out-of-state traffic citations. For example, Maryland, Virginia and the District of Columbia devised an agreement back in the 1960s, as did New York, New Jersey and other states in the region. However, widespread acceptance of the two compacts has wiped out the need for regional agreements.
Serious infractions harder to conceal
For the most part, states don’t care much about minor traffic violations, such as parking or standing infractions. So an out-of-state parking ticket or a citation issued for a broken taillight is not likely to be sent to your home state.
However, the more serious the infraction, the more likely it will follow you wherever you go. Not only must you worry about the two compacts, but the National Driver Register — a database run by the National Highway Traffic Safety Administration — keeps track of drivers who’ve had their driving privileges suspended, revoked, cancelled or denied. The database includes drivers who are guilty of serious traffic violations such as DWI.
Whenever a driver applies for a license or seeks to renew it, state motor vehicle departments check the database for infractions, which then can be attached to your driving record and can be used to deny driving privileges, according to the National Highway Traffic Safety Administration.
State rules differ
What states do with information about residents’ out-of-state traffic violations varies from place to place. Some states add only certain types of violations to a resident’s driving record. For example, a state that records only those speeding violations for driving 20 miles per hour over the limit might not flag an out-of-state citation for driving 10 mph over the limit.
States also vary in how out-of-state infractions affect a driver’s record. For example, New Jersey assesses two points on residents’ driving records for all out-of-state moving violations. On the other hand, New York does not tack points onto a driver’s record for out-of-state traffic violations unless those violations occurred in the Canadian provinces of Ontario and Quebec.
Some states may even withdraw your driving privileges for major violations in other states. For example, Wisconsin will suspend privileges for such out-of-state infractions as DWI, attempting to elude an officer and hit-and-run.
Out-of-state tickets and auto insurance
Of course, one of the biggest questions that drivers want answered is: Will an out-of-state ticket cause insurance premiums to rise? The answer depends on several factors:
• Whether your state adds that type of infraction to your driving record.
• The insurance laws in your state. For example, according to New York traffic attorneys Scott Feifer and Matthew Greenberg, citations for speeding up to 15 miles per hour over the limit shouldn’t harm your insurance rates.
• Your insurer’s practices when it comes to checking driving records. The more often your insurer checks driving records, the more likely you’ll soon face an increase. “Those serious violations could definitely have an effect on someone’s insurance rate if the insurance company pulls that driver’s record,” Lewis says.
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Italian cruise disaster reinforces need to consider travel insurance
January 17th, 2012
John Egan
Travelers normally remember to bring their passports, clothes, sunglasses and other vacation necessities. But many of them fail to pack something else that some experts say is just as important — travel insurance.
The Italian cruise disaster, which killed at least 11 people, serves as a sober reminder to look into travel insurance before you set sail or jet away.
Vikki Corliss, a spokeswoman for InsureMyTrip.com, says: “Understandably, no one wants to think about what could go wrong on their travels, but that’s exactly what you should do. Plan ahead and be prepared. Travel insurance is a traveler’s best defense against the unexpected.”
A standard travel insurance policy costs about 5 percent to 7 percent of the total price tag for a trip. So if you’ve booked a $ 4,000 cruise and paid $ 1,000 for air fare, you’ll fork over $ 250 to $ 350 for a travel insurance policy to cover the $ 5,000 investment. Most U.S. travel insurance plans cover travelers no matter where they are in the world — on the beach in Fiji or on a cruise ship off the coast of Italy.
“Travel insurance and assistance follows you wherever you may go,” says Daniel Durazo, a spokesman for travel insurance provider Access America.
What does a travel insurance policy cover? It depends on how much coverage you buy. Here are some of the basics that typically would be included in a comprehensive travel policy:
• Reimbursement for cancellation of your trip for a valid reason, such as a medical emergency.
• Reimbursement for lost or delayed luggage.
• Payment for lodging, meals and transportation during a travel delay.
• Replacement of passports and other missing travel documents.
• Delivery of messages to your loved ones and friends back home.
• Assistance with travel arrangements for your return trip home.
• Assistance with medical aid.
Of course, every travel insurance policy has coverage limits, so you may not want to splurge on a five-star hotel or lobster dinners before your claim is paid.
Carol Mueller, vice president of travel insurance provider Travel Guard North America, says: “Travel insurance covers you for the ‘what ifs?’ while traveling. While the tragic accident involving the Costa Concordia off the coast of Italy is highly unlikely to occur again, it’s important that consumers understand travel insurance is really important for covering the more common travails that occur while traveling.”
Rachel Hartman
Sitting in traffic is no fun. But when compared with getting into a crash, it’s the cheaper option – by far.
Traffic crashes cost society $ 299.5 billion a year, which amounts to an annual cost of $ 1,522 per person, according to a study released in November 2011 by AAA. Congestion, while a common gripe among motorists, sets society back just $ 97.7 billion a year, which amounts to $ 590 per person each year.
For the study, the costs of crashes were based on the Federal Highway Administration’s tallies for traffic deaths and injuries. The federal agency placed a value on 11 items, including property damage, lost earnings, medical costs, legal costs and lost quality of life.
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| Traffic congestion carries a far lower financial toll than traffic crashes, according to a study by AAA. |
Measured in 2009 dollars, the cost of a single traffic death came to $ 6 million. The study estimated the cost of a traffic injury at $ 126,000. These figures were compared with traffic congestion costs — including fuel costs and lost time — computed by the Texas Transportation Institute in its Urban Mobility Report.
“Although we have seen a decline in the number of traffic fatalities in recent years, our work is far from over,” says Angie LaPlant, a spokeswoman for AAA Auto Club South. “Continued progress is needed to provide the necessary and sustained investments that lead to better and safer roads.”
Auto insurance and car crashes
According to the AAA study, crashes on less congested roadways appear to result in less frequent, but more severe, crashes. On more congested highways, while the number of crashes tends to increase, the severity of each wreck decreases.
The number of crashes in your area can affect not only how you drive, but also what you’ll pay for auto insurance. When setting premiums, insurance companies look at the number of crashes in your Zip code or county to assess the risks involved.
“Accident frequency in an area can cause the base rate for auto insurance to increase or be higher than an area with a low-accident frequency,” LaPlant says.
How your vehicle will hold up in a crash also helps determine your auto insurance premium.
“A main component of insurance premiums for a vehicle involves the likelihood that the vehicle will be involved in a crash and what the cost for the crash will be,” says Russ Rader, a spokesman for the nonprofit Insurance Institute for Highway Safety.
Your insurance company will look at the type of car your drive, as well as statistics related to the costs of crashes for that model when setting auto insurance rates.
Safety tips
When it comes to auto insurance premiums, the area you live in and the car you drive are just two factors that will affect the price. The amount of coverage you want, your age and your driving record also will be taken into account.
While you can’t change your age, there are many steps you can take to keep your driving record as clean as possible. Follow these guidelines to stay safe while on the road:
1. Get a good start. Before you get behind the wheel of a car, familiarize yourself with the vehicle’s features, LaPlant says. Secure items that could shift around while the car is moving, such as briefcases, purses, toys and phones. Check your map or GPS before rolling down the road.
2. Stay focused. Avoid smoking, drinking, eating and reading while driving, LaPlant says. If you need to do an activity that will be distracting, such as attending to children, making a call or sending a text, ask a passenger for help; otherwise, pull over to the side of the road.
3. Make safety a priority. When shopping for a car, look for a crashworthy vehicle, Rader says. To find cars that rank well when it comes to crash prevention and protection, check the Insurance Institute for Highway Safety’s Top Safety Picks. “To be a top safety pick, the vehicle has to earn top crash ratings for protecting people when there is a crash, and it has to have electronic stability control, a key feature in preventing many kinds of crashes,” Rader says.
Steering clear of traffic congestion
The days of “rush hour” are gone, says David Schrank, co-author of the Urban Mobility Report. “Now it’s rush hours – with an ‘s.’” In some areas, rush “hour” can last six hours or more. While congestion often is considered a big-city problem, Schrank notes that it has grown worse in areas of every size during the past several years.
To avoid congestion, and the fuel and time costs that go along with it, follow these three steps:
1. Look into flex time. Many jobs allow flexible hours or even telecommuting, Schrank says. You may be able to change your work hours to avoid the rush or, better yet, stay home and miss it entirely.
2. Take alternate routes. Before heading out, check to see whether there’s a delay along your planned route. If there is, make a detour.
3. Explore other options. It may be more comfortable to ride to work in your car, but if your city offers an efficient public transportation system, you could save time — and aggravation — by taking the subway, train or bus.
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Why business owners need life insurance and ‘key man’ insurance
January 11th, 2012
Carol Tice
Business owners have unique life insurance needs. Because both their families and their businesses rely on them, they need to make sure their coverage protects both.
For three years, Carol Smithem ran two small businesses from her home in Folly Beach, S.C. When she met with a financial adviser, she realized there was a missing piece in her business plan: life insurance.
Smithem wanted life insurance to make certain her husband, William, wasn’t stuck with the mortgage and outstanding credit line on her condo — which she bought before the couple married — if she suddenly died. Smithem decided to buy $ 250,000 worth of term life insurance, which will last until after the condo is paid off.
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| Life insurance and “key man” insurance policies can prevent a business from being wiped out financially. |
“I wanted to make sure if I was hit by a bus, my husband wouldn’t be turned out of the house,” Smithem says.
How life insurance protects your family
Even though it endangers their families’ financial security, business owners often put off buying life insurance, says Leonard Wright, a San Diego financial planner and CPA.
One reason for this is confusion about the many types of life insurance on the market today, some of which aren’t a good deal. Wright recommends that business owners get details about the commission structure of any life insurance policy they consider.
“I saw one policy where the insurance agent was paid $ 300,000, and the buyer had hardly any cash value (from the policy),” Wright says. “Sometimes business owners get a sour taste in their mouths after hearing what happens to friends who had unsuitable products peddled to them.”
For young entrepreneurs in the early years of their businesses, term life insurance, which provides coverage for a specified number of years, is the right choice, says John Going, a certified financial planner at Going Brothers Financial in Houston. Coverage is affordable then because younger people present a smaller risk to insurers — only a small portion of them will die before the end of the term. Business owners in their early 40s might consider a 25-year term life policy, which would help their families recover lost income from business activity if the breadwinner dies before retiring.
The other forms of life insurance — whole or universal life — are more expensive because they cover the owner until he or she dies. Therefore, all such policies are assumed to require a payout eventually. Moreover, unlike term policies, whole life policies build cash value over time — in a way, they’re like a retirement account.
If a business thrives and its assets increase, it may make sense at some point to add either a whole life policy or convert the existing term policy to a whole life policy, Going says. The key advantage: Some term policies can be converted to whole life later without the business owner having to undergo a physical exam. Some of the term premiums also may be refunded in the process.
Going advises buying a term life policy from a major insurer with a stellar reputation that offers the option of converting to a whole life policy down the road.
How ‘key man’ insurance can save your business
While basic life insurance is essential for making sure family members are provided for if a business owner dies, it won’t ensure that the business survives.
Financial planner Wright had an experience early in his career that illustrated this problem. He once interviewed for a job at a successful regional retail chain whose CEO and chief financial officer both had been killed in a plane crash. Soon afterward, the job opening disappeared.
Without the trusted leaders of the company at the helm, Wright says, “the banks got spooked, cut their lines of credit, and the company went out of business. They didn’t have the cash to keep it going. I’ve seen this happen over and over.”
So, if you’re a business owner or a key figure at a business, additional insurance is needed to protect the business in case of your death. As Wright saw, banks may sever relations with a company after the sudden loss of the leader who built those banking relationships, despite the company’s strong financial record.
“Key man” insurance addresses this issue. This insurance pays out cash that can finance the business while new bank relationships are developed.
In a partnership, when one owner dies, the family of that owner often retains the person’s share of the business, Wright says. But if banks turn their backs and there is no insurance to provide cash for keeping the business afloat, the business can die as well, robbing the family of their share of what might have been many years of future profits.
“So many business owners don’t understand that key man insurance is just incredibly important to the survival of their businesses,” Going says.
Kathryn Hawkins
Self-employed American often have few options or protections when it comes to health insurance. Insurers often are able to reject applicants on the basis of existing medical conditions and can raise premium costs astronomically from year to year.
Sally Jamara, a self-employed business consultant from Atlanta, knows this firsthand. Since a knee injury a few years ago, she’s been unable to switch to a different insurance carrier because of her pre-existing condition. The cost of her current plan has been “dramatically rising,” forcing her into a high-deductible plan with high out-of-pocket costs.
“I now spend over $ 12,000 a year to cover my medical expenses,” Jamara says.
More than 10.5 million Americans are self-employed, but the difficulties of buying health insurance on the individual market can make entrepreneurship less attractive. The federal health care reform law, known as the Patient Protection and Affordable Care Act, has some provisions designed to protect entrepreneurs and others buying health insurance on the individual market. Here’s a look at how the federal law could affect the self-employed in the years to come.
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| Under the federal health care reform law, self-employed Americans will be able to buy health insurance even if they’ve got pre-existing conditions. |
Changes already in effect
A number of protections already have been put into place. In 2010, the federal government launched a national high-risk insurance pool for uninsured individuals with pre-existing health conditions who’ve been uninsured for at least six months. For uninsured self-employed workers who’ve been struggling to find coverage on the individual market because of health problems, this insurance pool could be an option.
Another insurance issue that hits the self-employed hard is a practice known as “rescission.” In the past, an insurer could retroactively cancel an approved policy when the policyholder got sick and began racking up bills. Often, the withdrawal of coverage would be based on relatively insignificant conditions that a policyholder mistakenly didn’t disclose during the application process.
A survey by the National Association of Insurance Commissioners found that health insurers had dropped about four of every 1,000 policies between 2004 and 2008. But the health care reform law has put an end to this practice for most policies. As of August 2010, it is illegal for insurance companies to retroactively cancel coverage for plans that began after Sept. 23, 2010. For self-employed workers, who must fend for themselves without the protection of an employer’s group coverage, this provision might provide some peace of mind.
One of the biggest money-saving provisions for the self-employed, however, comes in the form of tax credits for small business owners. Businesses with fewer than 25 employees that provide insurance may be eligible for tax credits worth 35 percent of the cost of coverage.
“Many of the self-employed fall just short of qualifying standards for subsidies and tax credits in the health reform law,” says Mike Beene, senior health policy adviser at the National Association for the Self-Employed. “They make too much to qualify for premium assistance but too little to afford the comprehensive coverage they will be required by law to buy.”
For example, the federal law’s small business health tax credit excludes the self-employed (defined as a one-person business), according to the National Association for the Self-Employed. The self-employed can qualify for premium subsidies for individuals and families when take effect in 2014. To qualify, someone must make below $ 43,340 and a family of four must have a household income below $ 88,200. The average household income is $ 62,500 for a self-employed member and his or her spouse, which makes them ineligible for premium assistance.
What’s in store
The health care reform law’s most controversial provision is the individual mandate, which requires all U.S. citizens and legal residents to be insured by 2014. This means all self-employed individuals will have to buy insurance or be fined. But it also means that insurers won’t be allowed to deny coverage, even for applicants with pre-existing conditions.
When the mandate goes into effect, self-employed workers, as well as owners of small businesses with up to 100 employees, will be able to shop for coverage through their states’ insurance exchanges. The exchanges are marketplaces that will let people compare health insurance costs and benefits. Several levels of coverage will be available.
To help individuals afford the mandatory coverage, premium subsidies will be available for those under certain income thresholds. Meanwhile, Medicaid will be extended to support low-income adults making up to $ 14,404 individually ($ 29,326 for a family of four).
The mandate is in danger, as 26 states have questioned its constitutionality. However, Joe Torella, president of employee benefits at insurer HUB International Northeast, says there’s good reason to mandate health insurance.
“The danger is that people will only buy health insurance when they’re sick and won’t buy when they’re healthy,” Torella says. “If I want to buy homeowner’s insurance, I can’t wait until my house is on fire. The only way health insurance will be affordable is if everyone has to play.”
No matter what becomes of the individual mandate, many experts don’t think the federal law will make health coverage cheaper for the average American. Because insurers will be required to include certain essential benefits in their plans, many low-cost plans no longer will be available.
“The new law isn’t going to fundamentally bring down health care costs,” says Robert Zirkelbach, a spokesman for America’s Health Insurance Plans, a trade group. “With the new benefit requirements, many people will need to buy more than they currently have.”
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If my Parents have full coverage car insurance do i need insurance?
January 8th, 2012
Question by elykmamda: If my Parents have full coverage car insurance do i need insurance?
I just got my Licenses and Im using my Parents car They have full coverage.So anyone that drives the car is insured.Do i need to get insurance?I plan on getting my own Car in another year or so.I do plan to get Insurance but for now am i covered?
Best answer:
Answer by cowgirlintex
If you live in the household, you need to be listed on their policy. What will happen if you have an accident is that the insurance will pay, but usually drops the policy, or it skyrockets b/c a driver was not listed.
What do you think? Answer below!
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If I have renters insurance with pet liability coverage, does the homeowner still need pet liability coverage?
January 6th, 2012
Question by le Hotpants: If I have renters insurance with pet liability coverage, does the homeowner still need pet liability coverage?
(i.e. if I have a dog that’s on “the list”)
Best answer:
Answer by T J
Absolutely! What happens if you let your policy laps!?
Add your own answer in the comments!
