Four Ways to Reduce Your Auto Insurance Claims

Many auto accidents that occur in the United States could easily be prevented. Following are some tips for avoiding accidents and thus reducing your insurance claims:

  • Distracted driving is happening at epidemic levels every day. Not a day goes by that you don’t see someone on his or her cell phone, talking or trying to text while operating a moving motor vehicle.
  • States are now enforcing laws to regulate this behavior. Common sense should rule. Focus on the task at hand and be aware of your surroundings at all times while driving.

The next most important part in reducing auto claims is wearing a seat belt. Serious injuries can happen on one-lane back roads just as easily as they happen on main thoroughfares. Be the designated seat belt wearer in your car and make sure all of your passengers are too.

Be sure to have enough room between you and the car in front of you. Should the vehicle in front of you stop short, you won’t have the amount of reaction time you think you do to stop. A good rule of thumb is to have at least one car length for every 10 miles per hour you are traveling. If something unexpected happens, you’ve given yourself plenty of time to stop and prevent a crash.

Auto safety includes keeping your vehicle up to snuff in the care and maintenance department as well. Keep up on regular oil changes, tire rotations and brake pad inspections. It’ll not only keep your car running in optimum condition, but you also won’t have to worry about your vehicle breaking down while you’re on the road and potentially causing an accident. Likewise, if you see another driver in a beat-up, run-down vehicle, you’ll want to steer clear so you’re not involved in an accident.

Driving can be a very fun experience. Do everything in your power to make it that way.

Is Your Home Properly Covered for 2012?

The beginning of the year is a good time to review your insurance policies to make sure you have adequate limits and coverage.

Values may have depreciated with the economy. If there were a total loss of your home, it may not cost as much to replace today as it would’ve this time last year.

Insurance companies use a cost per square foot to determine what they would need to pay out to replace your home. If you have a 2,500-square-foot home and the insurance company is paying $100 a square foot, your limit would be $250,000.

If the insurance company changed it to $90 a square foot, your limit would be $225,000. You would see a savings in premium based on the lower limit of coverage.

If you don’t agree with the limit of coverage on your home, another option is to get an independent appraisal of your replacement cost.

Insurance carriers generally honor these reports and will charge you based on the limit that you request.

Another area to review is contents coverage. Have you bought or sold any big-ticket items throughout the year? If you purchased electronics for your new home theater or specialized equipment for a hobby, you may want to adjust your limit of contents coverage to make sure it is adequate. Likewise, if you have sold something of substantial value, you may want to have your contents coverage reflect the decrease in limit.

This is where your insurance agent can shine and help you determine the best choice in coverage for your needs. Your agent can tailor your coverage to your needs.

General Liability: Are You Properly Covered?

General liability is an essential type of coverage for a business owner.

If you run a bakery, manufacture a product or have clients come to your office, there is a liability exposure.

Commercial general liability insurance comes with six different components of coverage.

Following is a sample of how the liability coverage page would read for someone with a $1 million to $2 million limit:

General Aggregate – $2,000,000

Products-Completed Operations Aggregate – $2,000,000

Each Occurrence – $1,000,000

Personal and Advertising Injury – $1,000,000

Damage to Premises Rented to You – $500,000

Medical Expenses – $10,000

The General Aggregate and Each Occurrence categories correspond with each other. If there is a general liability claim (Each Occurrence) such as a slip and fall at the grocery store, it would contribute to the General Aggregate. There can be two claims of this type, up to $1 million each, before the limit of insurance is exhausted.

The Each Occurrence limit corresponds with the Products-Completed Operations Aggregate limit. If a customer swallowed on a piece of one of your products, like food or small plastic pieces, and got sick because of it, this claim would fall under the Products-Completed Operations Aggregate limit of insurance. As with the General Aggregate limit, there can be two claims of this type, up to $1 million each, before the limit of insurance is exhausted.

Personal and Advertising Injury provides coverage for oral or written material that may be libelous or slanderous or that copies another’s advertisement, logo, slogan or other artistic work so closely that it can be confused with the original, as well as discrimination or humiliation that ruins someone’s reputation. The limit of coverage on claims of this type is $1 million. There is no General Aggregate limit provided.

If you are renting the space for your business and you accidentally cause a fire that destroys part or all of the building, the limit of Damage to Premises Rented to You will cover this cost. This coverage is sometimes called Fire Legal Liability. There is no aggregate on this limit either. Insurance carriers offer various limits on this one. Some may offer half of the Each Occurrence limit, while others may offer up to the same limit.

If there is a minor accident that results in some small injury or damage, Medical Expenses will pay the claim, no questions asked, up to the limit of insurance.

Higher limits are also available. Many companies offer $2 million to $4 million limits, and some are even beginning to offer $3 million to $6 million limits as well.

Depending on the limit, other types of coverage listed would be increased proportionately as well.

Also, deductibles do not apply with liability insurance as they do in property insurance.

Insurance carriers have a minimum premium that they charge for commercial general liability insurance.

It can range from $350 to $750 a year.

Is It Wise to Go Without Life Insurance?

As the economy continues to struggle, many Americans are cutting back.

And for some, that means going without life insurance coverage.

In fact, about 35 million U.S. households currently do not have life insurance.

That’s the highest percentage in more than four decades, according to insurance industry research group LIMRA.

Can going without life insurance be justified?

Of course, only you are familiar with your individual financial circumstances and goals, so only you can decide if life insurance is something that’s necessary for you.

But consider this: Among households with children under 18, four in 10 respondents to a survey by LIMRA said they would have trouble meeting immediate living expenses if the primary wage earner died.

The same survey indicated that three in 10 would have trouble after several months.

Thus, going without life insurance may not be a good idea for those who have dependents.

That said, it can be difficult to justify the expense of life insurance in troubled times.

Employers have scaled back or eliminated coverage, with the number of households getting life insurance from employers falling, according to LIMRA.

Many people think they just can’t afford to purchase life insurance on their own.

Many people also don’t know how to purchase life insurance, given that the number of company-affiliated life insurance agents has dropped by nearly one-third since the 1970s, according to LIMRA.

Life insurance may be less expensive than you think, however, and many options are available.

Your insurance agent can help you find a suitable policy that’s right, given your individual needs and financial circumstances.

Health Insurance Options for the Self-Employed

Although being your own boss has many benefits, one of the necessary evils is that of securing your own health insurance. But never fear – there are options available, and they may not be as costly as you may think.

Self-employed individuals – including those who are contractors, freelancers and sole proprietors – are eligible for two primary categories of insurance that are available: individual health insurance coverage and group coverage.

Opting for an individual health insurance policy may carry a higher premium amount. However, oftentimes these types of policies are necessary for self-employed persons who have preexisting conditions.

This is because each policy is actually written based on the covered insured’s individual medical history.

Group plans available for the self-employed include organized medical insurance networks such as health maintenance organizations (HMOs) and preferred provider organizations (PPOs).

Although an HMO will offer lower premiums in most cases, the insured is required to live in an area where benefits may be received. Going with a PPO, an insured may have more leeway in terms of provider choices and in the geographical area in which services may be received.

Another option for obtaining health insurance that may be available to those who are self-employed is that of joining a business association through which the business owner may obtain group health insurance.

Oftentimes, those who are members of certain associations are eligible to receive discounts on health insurance coverage if the policy is purchased through that association.

How Health Care Reforms Could Affect You

There has been much talk over the years as to how the new health care reform will affect health insurance policies. With the many changes that will soon be coming through, insured individuals should be aware of how this new legislation may change the way they are currently insured.

For those who own individual health insurance plans, they will be allowed to make a choice between keeping their current policy or purchasing health insurance coverage through the new state-run exchanges beginning in the year 2014. Those who decide to keep their current plan will have some provisions that they should be aware of, including:

  • Current health insurance policies will not be required to meet the higher benefit standards that will be required of new health insurance policies. However, due to the fact that insurance companies will be unable to add new benefits or enroll additional insureds into policies that are considered to be noncompliant, the current health insurance policies may not be viable for a very long period of time in the future.
  • Shortly after the new health care reform takes effect, current health insurance policies in force will have to stop practices such as setting of annual limits on coverage and canceling the policies of insureds who become seriously ill.
  • Current health insurance policies will also be required to keep the children of an insured covered on the policy until they turn age 26. In addition, health insurance policies that cover children will not be allowed to deny coverage for those who have preexisting conditions.

It should be noted that although the premiums for individual health insurance policies will probably be 10% to 12% higher by the year 2016, most insureds will likely be qualified for some type of premium-related subsidy. This means that these insureds will actually end up paying less for their health insurance coverage than they do today.