Monthly Archives: April 2016

teendriver3

A good way of looking at your teenager receiving their driver’s license is less chauffeuring you’ll need to do. There can be little doubt that your eager new driver will be happy to take the family sedan out on whatever errand you need them to run. Plus, they will say, you don’t have to be bothered with dropping them off or picking them up. Great news for you, right? Of course, the cost for all this freedom – besides extra trips to the gas station – is an adjustment on your auto insurance policy.

Nearly all insurance companies require that all members of your household that are licensed drivers be added to your auto policy. If you have several vehicles, you can add drivers to individual vehicles, ideally those that are the least expensive to insure. You can also exclude drivers, but that means they are specifically not covered for anything that happens while driving your vehicle. This could also be cause for cancellation should something occur.

As far as your teen drivers go, you’ll want to let your insurance professional know when he or she gets their learner’s permit. They won’t necessarily need to be listed on your policy until they are fully licensed. If you do not have primary custody of your teen, you may not need to add them as a household driver. You should check with your insurance professional to be sure.

Another option is for your teen driver to have their own vehicle. Just bear in mind that premiums for teen drivers are high as it is. Insuring a separate vehicle may cost more than adding the vehicle (and driver) to your policy. Also check to see what sort of discounts (good student, driver’s education, etc.) there may be available.

There are systems available for monitoring driving behaviors — speeding, seat belt usage, hard braking and cornering – that can send you a notification if your teen does something he or she is not supposed to do. Technology is available that blocks cell phone calls and text messages when a vehicle is in motion. Installation of any of these systems could mean a premium reduction.

There is no substitution for discussing this new policy need, as well as any others, with your insurance professional. They are an excellent resource for all things insurance-related and can help you to find the coverages you need at a price you can afford.

single car accident 3Like other responsible drivers, you carry the appropriate auto insurance coverage. You know the state mandates a minimum level of liability coverage, but you have way more than that to cover “the other guy.” But what about your own about your own vehicle and its contents? That is what comprehensive and collision insurance is for. For this blog entry, we will focus on collision coverage.

Collision insurance covers some or all repairs or replacement costs to your vehicle due to an accident with another vehicle or if you hit another object (tree, wall, etc.), if you are in an accident with another vehicle, drive into an object such as a tree, building, or telephone pole, or other types of damage. You are not required by law to carry collision coverage, but if your car is financed, your lender will almost always oblige you to have that insurance.

If you opt not to purchase collision coverage, your lender can do it for you, something called “forced placed” insurance and charge you a premium along with your monthly payment. Collision insurance covers the vehicle, not you, and that’s what the lender is concerned with. Premiums for this type of insurance can cost up to five times more than if you had purchased collision coverage through your own insurer.

To figure out if you need collision coverage on a vehicle that is paid off, first calculate its value using a resource like the Kelley Blue Book. Then think about whether or not you can afford to replace your car on your own, remembering that the insurance company will only pay you how much it’s worth, less any deductible.

If you currently have collision insurance but are considering dropping it, you will save some on your premium. To a large extent, the cost is based on your driving history, the value of your vehicle, and the size of your deductible. If you have been in more than a few at-fault accidents, you are probably paying a higher premium for that coverage. Depending on the age and condition of your vehicle, it may make sense to reconsider.

It is always a smart move to discuss all of your coverage needs with your insurance professional. They can explain which coverages you currently have, which ones may not be necessary anymore, and which ones you are lacking.

Man breaking into car

As a diligent driver and vehicle owner, you carry full coverage on your vehicle. In the event it is stolen, you know you will be able to replace it (minus depreciation and deductible). If there is something inside or on the vehicle that is stolen, that will be replaced, too.  Right?

Most people know that if your vehicle is stolen, the theft coverage from your auto insurance will help pay to replace it. The contents are a different story. The comprehensive portion of your auto insurance is what pays for non-accident-related losses. Unfortunately, the coverage only extends to the vehicle itself and not its contents. If you leave personal property in your vehicle, such as a laptop, cell phone or even your wallet, you may be out of luck.

There are a few things to consider when thinking about personal items in your vehicle and whether or not they would be covered in the event of a loss:

  • Is an item permanently attached to your car? If it is easily removed or portable, it wouldn’t be considered permanently attached and not covered by your auto insurance.
  • If an item is permanently attached to your car, but not original equipment (expensive stereo, aftermarket equipment, etc.), you probably need additional coverage. This is especially true with custom vehicles.

If you have homeowner’s or renter’s insurance, items stolen from your vehicle should be covered. Naturally you will need proof you actually owned the lost items, most commonly a receipt. You will likely need to file a police report and follow the claims process, but at least you can get your property replaced. When considering whether to file a claim, remember that your homeowner’s policy probably has a higher deductible than your auto policy.

Having insurance coverage can bail you out of some pretty big jams. Homeowners, auto, health, marine, etc. can all make a big difference in your financial well-being. Of course that’s if you have the right coverages. Why not meet with your insurance professional to make sure that you do.

pocket money 3You get into a little fender-bender in your car. Not too much damage but you decide to turn in a claim. All the appropriate estimates are obtained and your insurance company pays for the repairs no problem… except for your deductible. Doh! You forgot about that.

Just to refresh your memory, a deductible can be either a specific dollar amount or a percentage of the total amount of insurance on a policy. Logically, the higher your deductible is, the lower your premium will be. Since you are shouldering more of the risk, you pay less up front.

Here is how it works: if you have a $500 “dollar deductible” and a $2,000 claim, the insurance company would pay you $1,500 ($2,000 – $500). This type of deductible is common for auto insurance and homeowners insurance. “Percentage deductibles” are calculated differently.

In the case of a homeowners insurance claim, the deductible is based on a percentage of the home’s insured value. So if your house is insured for $100,000 and your insurance policy has a 2 percent deductible, $2,000 would be deducted from the amount you are reimbursed on a claim. In the event of the $10,000 insurance loss, you would be paid $8,000.

Deductibles are different in health insurance where there a single annual deductible for the policy. With an auto or homeowners insurance policy, the deductible applies each time you file a claim.

For earthquake insurance, California residents can purchase a policy through the California Earthquake Authority (CEA). The standard CEA policy deductible is 15 percent of the replacement cost of the home. The CEA also offers a 10 percent deductible for other structures, personal items coverage up to $100,000 and $15,000 in “loss of use” coverage.

For more information on deductibles, how they affect your premium, and any other questions you may have, make an appointment with your insurance professional. They will explain all facets of your policies and help figure out how you can obtain the coverage you need at a price you can afford.

distracted driving 3

Activities that take drivers’ attention off the road, including talking or texting on cellphones, eating, conversing with passengers and other distractions, are a major safety threat. according to the National Highway Traffic Safety Administration. (NHTSA), seven out of 10 drivers admit they engage in smartphone activities while driving.

Texting and emailing are still the most prevalent. But other smartphone activity use behind the wheel is now common. Among social platforms, Facebook tops the list, with more than a quarter of those polled using the app while driving. About one in seven drivers said they’re on Twitter while behind the wheel.

“As we rely on our cell phones more and more in our everyday lives, we seem to be kidding ourselves in thinking that they don’t affect our driving,” said California Office of Traffic Safety Director Rhonda Craft. “Crashes are up. The scientific evidence is solid. The dangers are real, and they apply to all of us. We need to silence the distractions.”

To raise awareness about unsafe behavior, numerous safety agencies have joined forces to designate April as Distracted Driving Awareness Month. In 2014, 3,179 people were killed and an additional 431,000 were injured in collisions involving distracted drivers in all 50 states, the District of Columbia, and Puerto Rico. That same year, inattention collisions resulted in the death of 104 people and the injury of 11,436 others in California.

If you have teen drivers in your home, you not only need to be aware of your own distracted driving, but theirs as well. The NHTSA’s website www.Distraction.gov has some excellent information on distracted driving. “It Can Wait”, a public awareness campaign funded by four by wireless carriers, provides resources on the dangers of distracted driving, including smartphone apps (not for use when behind the wheel, videos and more.

lemon car 2

There are some lists everyone wants to be on, while other lists are not so popular. When a national-recognized consumer advocacy organization like Consumer Reports publishes results from a study they’ve conducted, the difference between one list and the other can definitely affect sales.

Recently, the group released its list of worst cars for 2016. The magazine chose the vehicles based on various criteria, including road-test score, projected reliability, owner satisfaction and safety. To maintain the integrity of its reports, the group purchases vehicles anonymously directly from dealerships. No special auto company perks are allowed.

Here are the ratings:

  • Lowest-rated subcompact: Mitsubishi Mirage. Cheap to buy and good gas mileage, but its “tiny, tinny” and the three-cylinder engine vibrates.
  • Lowest-rated compact: Fiat 500L. “More people than usual who own this car wish they didn’t”
  • Lowest-rated midsize sedan: Chrysler 200. “A mediocre car.”
  • Lowest-rated compact luxury car: Mercedes-Benz CLA250. “The ride is punishingly stiff.”
  • Lowest-rated midsize luxury car: Lincoln MKS. – “Outdated and outclassed.”
  • Lowest-rated family SUV: Dodge Journey. “This crossover is a poor value anywhere outside of an airport rental lot.”
  • Lowest-rated luxury compact SUV: Land Rover Discovery Sport. “Struggles in comparisons even with mass-market small SUVs.”
  • Lowest-rated large luxury SUV: Cadillac Escalade. “Falls down on the fundamentals as a luxury SUV.”
  • Lowest-rated minivan: Chrysler Town & Country. “It doesn’t even score high for interior room and fuel economy, two areas you’d think a family minivan would do well in.”
  • Lowest-rated green car: Mitsubishi i-MiEV. A “This half-step up from a golf cart is slow, clumsy and still riding.”

“Those models with low predicted reliability and mediocre, or worse, road test performance are simply those that we wouldn’t recommend to family and friends,” said Jeff Bartlett, deputy editor of cars for Consumer Reports. “And combining these ratings puts data behind that guidance.”

Hopefully, your new car is not among the “winners.”