Auto Insurance: Most popular Car insurance questions and answers from FAQs

Showing posts with label Most popular Car insurance questions and answers from FAQs. Show all posts

11/1/09

Frequently Asked Questions on Auto Insurance

1) ARE THERE ANY SPECIFIC TIME LIMITS FOR AN INSURANCE COMPANY TO PAY FOR COLLISION OR COMPREHENSIVE CLAIMS?

There are no specific time limits for the settlement of claims. Insurance companies are required by law to pay all claims in a prompt and reasonable amount of time. However, what constitutes "prompt and reasonable" may vary from claim to claim. Claims that require special or extended investigation may take longer to resolve. Inclement weather conditions often cause an increase in the number of claims filed and that can delay the process as well. If, however, the insurance company fails to pay a comprehensive or collision claim within seven days after it receives an official claim form stating that the vehicle has been repaired, the insured may sue for the payments claimed to be due.

2) MY AUTO WAS DECLARED A TOTAL LOSS FOLLOWING AN ACCIDENT. IS MY COMPANY REQUIRED TO GIVE ME THE REPLACEMENT COST?

When your auto is declared a total loss, your insurance company will pay you only the actual cash value of the auto as of the date of the loss, not the cost to replace it. Your auto's value is determined by the following factors: the retail value for an auto of like kind and quality prior to the accident; the price paid for the auto plus the value of prior improvements to the auto at the time of the accident; the decrease in value of the auto resulting from prior unrelated damage which is detected by the appraiser or for which a claim has been paid; and the actual purchase cost of an available auto of like kind and quality.
If your auto has substantial value because of its exceptional condition such as an antique, classic, or restored auto, you should have it appraised and then insure it for the appraised value.

3) DO I HAVE TO PAY AN INSURANCE PREMIUM AFTER MY AUTO IS DECLARED A TOTAL LOSS?

Yes, you must pay an insurance premium even if your auto is declared a total loss until such time that you return your license plates to the Registry of Motor Vehicles. Your auto policy terminates when you return the license plates to the Registry of Motor Vehicles. If you don't have your license plates because your auto was stolen or because your auto and plates were destroyed in a fire, you must go to the nearest Registry of Motor Vehicles office and obtain a lost or stolen plates receipt. This receipt must be presented to your insurance company in order to cancel your policy and avoid paying any additional premium.

4) MAY I KEEP MY AUTO IF I HAVE A COLLISION, LIMITED COLLISION OR COMPREHENSIVE CLAIM AND MY INSURANCE COMPANY DECLARES IT A TOTAL LOSS?

4) MAY I KEEP MY AUTO IF I HAVE A COLLISION, LIMITED COLLISION OR COMPREHENSIVE CLAIM AND MY INSURANCE COMPANY DECLARES IT A TOTAL LOSS?Your insurance company has the option to take title to your auto when it issues payment on your claim. The insurer is entitled to any salvage value your auto may have. You can, of course, negotiate with your company to purchase your auto for the agreed salvaged value.

5) THE BODY SHOP IS REPAIRING MY AUTO AFTER AN INSURED LOSS. WILL MY INSURANCE COMPANY PAY FOR ORIGINAL EQUIPMENT MANUFACTURER (OEM) PARTS?

If the repair of the damaged part impairs the operational safety of the auto, the insurance company will pay to replace it with an OEM part. For non-safety parts, unless your claim occurs during the first 20,000 miles on the auto's odometer, you are not entitled to OEM parts. For autos with more than 20,000 miles, state regulation allows for the replacement of damaged parts with used, reconditioned or after market parts. You can insist on OEM parts, but you will have to pay the difference in cost.

6) AN OBJECT DAMAGED MY WINDSHIELD AND I AM UNABLE TO DETERMINE WHERE IT CAME FROM. AM I COVERED FOR THIS LOSS?

Yes, if you have comprehensive insurance you are covered for the full amount of the loss, unless you opted for a $100 deductible for glass breakage. The $300, $500, or $1000 deductible, or whatever you may have selected for comprehensive coverage, does not apply to a glass loss.

7) CAN MY INSURANCE COMPANY DENY A CLAIM FOR DAMAGES TO MY AUTO IF THE PRINCIPAL PLACE OF GARAGING LISTED ON MY APPLICATION IS FALSE?

Yes. If you or someone on your behalf gives false, deceptive, misleading or incomplete information on any application and if such information increases the insurance company's risk of loss, your company may then refuse to pay claims under any or all of the Optional Insurance coverages of the policy. Such information includes the description and place of garaging of the vehicles to be insured, the names of the operators required to be listed and the answers given for all listed operators. In the event that you have moved since you filled out your initial application, promptly notify your insurance company and the Registry of Motor Vehicles of your new address.

8) IS MY INSURANCE COMPANY REQUIRED TO NOTIFY ME OF ITS DECISION TO CANCEL MY POLICY?

Yes. Your company must send you a notice at least 20 days prior to the effective date of the cancellation. A notice sent by regular mail with a certificate of mailing receipt obtained from the Post Office is considered sufficient. Certified or registered mail with a return receipt is no longer required.

9) WHAT CAN I DO IF I ACTUALLY RECEIVE A CANCELLATION NOTICE?

If your policy is being cancelled because you have failed to pay your premium, you must pay your exact outstanding premium immediately to prevent cancellation. If you feel that the cancellation is unjust for any reason, you may submit a written appeal to the Board of Appeals at One South Station, Boston, MA 02110-2208. This must be done prior to the effective date of cancellation.

10) WHO IS LIABLE FOR THE STORAGE CHARGES ON MY DAMAGED AUTO WHEN THERE IS A DISPUTE AS TO THE AMOUNT OF THE CLAIM PAYMENT?

The insurance company is responsible for paying storage charges until it makes a reasonable offer to settle the claim. However, if the consumer disputes the amount offered and the company revises its offer, this does not necessarily mean that the original offer was unreasonable. Disputes over what is reasonable can be resolved with your company through the process described in your insurance policy. You can also submit a written complaint to the Division of Insurance if you are unable to settle the dispute.

11) MAY AN INSURANCE COMPANY REQUEST A DOWN PAYMENT IN ADVANCE WHEN I PURCHASE OR RENEW AN AUTO INSURANCE POLICY? AND IS IT POSSIBLE TO PAY MY PREMIUM MONTHLY?

Your insurance company may request up to a 30 percent down payment of the annual premium prior to the renewal or issuance of your policy. Many companies offer an installment payment plan for the balance of the premium. You should check with your agent or company to see what options are available to you.

12) IF I OWN AN AUTO WITH COLLISION AND COMPREHENSIVE COVERAGE, WILL MY INSURANCE APPLY TO A RENTAL OR BORROWED PRIVATE PASSENGER AUTO?

Yes. Your collision and comprehensive insurance coverages are transferable to a substitute rented or borrowed private passenger auto that is damaged while it is being operated by you or members of your household with the consent of the owner. There is no coverage under your policy for family friends or significant others. You should be aware that your coverage is available only if you rent or borrow a private passenger auto in the United States or Canada. You should also be aware that your policy does not provide coverage for a borrowed or rented truck. If you are renting a truck, you should check with the rental company regarding the purchase of collision and comprehensive insurance. If you are borrowing a truck, make sure you determine whether or not the owner has purchased collision or comprehensive coverage. If the owner does not have insurance, you may be personally liable for any damage to that truck which is the result of your negligent operation. If the use is for business rather than pleasure, call your agent first. Business use is usually not covered under your personal auto insurance policy.

13) HOW DO I GO ABOUT SWITCHING INSURANCE COMPANIES PRIOR TO THE END OF MY POLICY WITHOUT PAYING A PENALTY?

Once you receive an invoice reflecting new (not estimated) rates and any applicable new deviations or discounts, you have 30 days to change insurance companies without paying a "short rate" penalty. If you make a change within this 30 day period, you will pay your former insurance company on a pro-rata basis at its newly established rates until the date the coverage with your new insurance company begins. If you choose to switch insurance companies after the 30 day period, you may be subject to a short rate penalty which decreases as your policy year progresses depending on the insurance company to which you transferred your coverage. You should ask your new insurance company whether it will reimburse you for these penalties.

10/25/09

Frequently Asked Questions on Auto Insurance

9/18/09

Is it necessary to hold on to old auto insurance bills?

I switched auto insurance companies recently and I was just wondering if there is any reason at all I should keep my old auto insurance bills from the old company. I'm the one who HATES clutter and I want to get rid of things I don't need anymore. Thanks.
Answer:
I recently changed to AAA. If no claim pending it is not necessary to keep the old bills. But keep policy number for a couple months for refernece if need be.
I now use the plastic shoe boxes to weed out things then go through boxes and thin more later. I label each one, such as bills paid, autos, bank, charge accounts, phone, utilties, TAX reciepts, house repairs, Working well for me so far.

5/31/09

In New York State, do you have to have a valid driver's license in order to get car insurance?

According to the New York State Department of Motor Vehicles you are not required to have a driver license or learner permit to apply for a vehicle registration or title certificate in state of New York. These requirements also apply to the registration of a boat, a snowmobile, or an ATV.

So without a valid license you can buy, register and title a car in your name however getting insurance will be more difficult. Your driver's license record is one of the main rating factors typically for any car insurance carrier so without a valid license they do not have a motor vehicle record to rate you on. Or if your license is not valid due to it being suspended or revoked than an insurer will have difficulties wanting to insure you since you are a risk to them. Obviously if your license is not valid you are not supposed to be on the roadway with the car and so you driving without a valid license pose liability risks to your insurance provider that they do not want.

If you do not have a valid license due to a medical condition, disability or even due to a suspension or revocation you may still be able to get insurance for a vehicle if you are excluded as a driver from the policy and instead have the person (or people) that are going to drive you around in your vehicle listed on your auto insurance policy as the drivers. The car insurance company could then rate your policy using these drivers valid driver's license record.

Not all insurers are willing to exclude the owner from their own policy so you may need to shop around for the right coverage. There are insurance companies, such as Esurance, that allow another person to insure your car, even without insurable interest in it so that could be another option where the driver is the person insuring the car instead of you the owner without a valid license.

Getting auto insurance without a valid driver's license may be possible but is a lot more difficult to do because of insurance company guidelines, not any NYS State laws. New York State just wants you to carry at least the state's minimum car insurance requirements on your vehicle if it is registered in NYS.

Auto Insurance Question & Answer

In Tennessee, how many points is allowed before a driver's license is suspended?

The amount of points accumulated on your Tennessee driver's record that will cause your driving privileges to be suspended varies depending upon if you are an adult or teen driver.

As an adult driver you may face suspension of your license once you have reached 12 points within a 12 month period. The TN Department of Safety states that they have set up the Driver Improvement Section of their agency to monitor the driving records of Tennessee drivers and they send out notices when you have accumulated too many points according to state laws.

Drivers that accumulate twelve (12) or more points on their TN driving record within any 12-month period are sent a notice of proposed suspension and given an opportunity to attend an administrative hearing. If they fail to request a hearing, their driving privileges are suspended for a period of six (6) to twelve (12) months. In most cases, when a driver requests a hearing, they are given the opportunity to attend a defensive driving class in lieu of suspension or a reduction of suspension time.

Teenage drivers are looked at closer since they are inexperienced drivers and thus drivers less than eighteen (18) years of age that accumulate six (6) or more points on their driving record within any twelve (12) month period are sent a notice of proposed suspension from the Department of Safety and are placed in the Driver Improvement Program. The driver will be required to attend an administrative hearing, with their parent or guardian present, to discuss the points assigned to their driving record. Certain actions could be imposed based on the outcome of the hearing and the number of points accumulated on the driver's record.

When a teen driver has accumulated between 6 to 9 points:

* Driving privileges may be suspended for 3 to 6 months.
* Driver must attend and complete a Defensive Driving Course within 90 days.
* Failure to attend hearing by the driver and parent/guardian present will result in a mandatory 6 month suspension of the juvenile's driving privileges.
* If a driver's license is suspended, all legal and departmental requirements for reinstatement, including proof of liability insurance, completion of a Defensive Driving Course and payment of reinstatement fees, must be met before driving privileges can be reinstated.

If they have been assessed 10 or more points than:

* Driving privileges will be suspended for 6 months.
* Failure to attend hearing by the driver and parent/guardian will result in a mandatory 6 month suspension of the juvenile's driving privileges and attendance at a Defensive Driving Course.
* All legal and departmental requirements for reinstatement, including proof of liability insurance, completion of a Defensive Driving Course and payment of reinstatement fees, must be met before driving privileges can be reinstated.

If a driver under the age of 18 accumulates 6 or more points on their driving record in a 12-month period following the first offense (so this now counts as a second or subsequent offense of receiving too many points on your motor vehicle record), the driver is sent a notice of proposed suspension from the Department of Safety and is placed in the Driver Improvement Program, with a copy sent to the driver's parent/guardian.

Then their driving privileges will be suspended for 6 or 12 months depending on their driving record. All legal and departmental requirements for reinstatement, including proof of liability insurance, completion of a Defensive Driving Course and payment of reinstatement fees, must be met before driving privileges can be reinstated for the teenage motorist.

Per chapter 1340-1-4 of the Rules of Tennessee Department of Safety Control Division an adult driver shall receive only one (1) advisory letter of caution within a five (5) year period. Also any driver not suspended entering the Driver Improvement Program who has not been involved in the program within a five (5) year period shall be treated as a first offender. So if you accumulate 12 or more points twice within a 5 month period you will be given harsher penalties since the TN Department of Safety will look at it as a second offense.

In Tennessee points are typically kept on your record for 5 years. While too many points may affect your driving privileges, too many traffic violations on your motor vehicle record (MVR) and cause your insurance rates to be affected. Whether you have a clean driving record or a few traffic offenses on your MVR, you can click here to get instant car insurance quotes for the state of Tennessee.

How old do you have to be to sit in the front seat in a car?

Legislation varies from state to state regarding the issue of seat belts, child restraints and when a child may be allowed to sit in the front seat. The National Highway Traffic Safety Administration (NHTSA) recommends all children under age 13 sit in the back seat of a motor vehicle. Many states also suggest that the age of 13 is when it is appropriate for a child to finally sit in the front seat.

For example, the Kentucky Transportation Cabinet notes there is not a state law governing the age of front seat passengers but that the risk of injury is greater in the front seat for children, with or without an airbag. Research shows it is best for children ages 12 and under to ALWAYS ride in the back seat so that is their recommendation as well.

New York State notes that although NYS does not have a law preventing children from sitting in the front seat, it is highly recommended that all children age 12 and under ride properly restrained in the back seat. Researchers estimate that just by putting a child in the back seat instead of the front seat reduces the chance of injury and death by more than 30 percent.

NYS also says that infants in rear-facing car seats should never be placed in the front seat of a car with a passenger-side air bag. While air bags provide effective protection for adult passengers, the great forces produced by an inflating air bag can injure or even kill a child. In fact, the safest place for children of all ages to ride is in the rear seat of the vehicle. If there is no other option, children in forward-facing child seats can ride in the front seat, but the passenger seat should be placed as far back from the dashboard (and air bag) as possible.

Rhode Island's laws state that children who are less than seven (7) years old must be transported in a federally approved restraint seat in the back seat of the vehicle. They require you follow instructions for use described in the restraint seat manual for age and weight.

California law (CA Vehicle Code 2736) basically states that any child under the age of six weighing less than 60 pounds must be secured in a federally approved child passenger restraint system and ride in the back seat of a vehicle. The VC notes that a child under the age of six weighing less than 60 pounds may ride in the front seat of a vehicle when:

* There is no rear seat or the rear seats are either side-facing jump seats or rear-facing seats.
* The child passenger restraint system cannot be installed properly in the rear seat.
* All rear seats are already occupied by children under the age of 12 years.
* A medical reason requires the child to ride in the front seat.

A child may not ride in the front seat of an airbag-equipped vehicle if the child:

* Is under one year of age.
* Weighs less than 20 pounds.
* Is riding in a rear-facing child passenger restraint system.

The NHTSA site says that the rear seat is the safest place for children of any age to ride. An infant in a rear-facing child seat must ride in the back seat if your vehicle has a passenger air bag. Make sure that everyone in the front seat is properly buckled up and seated as far back from the air bags as is reasonably possible when they do reach an age in which to sit in the front.

They also advise drivers to make sure that all young children are properly secured in an age and size appropriate restraints. The NHTSA has an Auto Safety Hotline at 1-888-DASH-2-DOT (1-888-327-4236) which you can call to get more information on this topic.

To find out if your state has any laws that mandate you cannot have a child under a certain age in the front seat, contact your local Department of Motor Vehicles.

5/1/09

Auto Insurance Claims - General

1. Who Will Pay For My Damage ?
2. How Much Will Be Paid ?
3. How Many Estimates Must I Get ?
4. Must I Accept Used Parts ?
5. What if Additional Damage is Found During Repairs ?
6. Is Frame Damage Reparable ?
7. Which Body Shop Should I Choose ?
8. Do I Get Substitute Transportation ?
9. Will My Repaired Vehicle Be Worth What It Was Before The Accident ?
10. How Are Total Loss Settlements Figured ?
11. What if I Do Not Agree With The Settlement Being Offered ?
12. Judicial Measure of Damage … What the at-Fault Party Owes !
13. More Info . . . Specific to My State

Who Will Pay For My Damage ?

A simple question that can have a simple answer. If you have Collision Coverage or Comprehensive Coverage on your own Auto Policy (depending on the cause of damage), your insurance company will pay for the damage to your vehicle regardless of who may have been at fault in the accident or incident (assuming you have not intentionally caused the damage yourself). Collision and Comprehensive Coverage covers damages sustained by your vehicle. This is the coverage that would be required by your lender if you have a lien on your vehicle. If you have a lien on your vehicle but do not have Collision and Comprehensive Coverage on your own policy, the lender will probably have purchased VSI (Vendor's Single Interest) coverage. In effect, this is Collision and Comprehensive Coverage that protects the interests of the lender only . . . not the owner/borrower. The most that would be paid out on VSI coverage is the lesser of either the cost of repair, the ACV (Actual Cash Value) or the remaining balance owed on the loan. Any equity you may have in you vehicle is not insured by VSI coverage. In order to protect your equity interest in your vehicle, you should have Collision and Comprehensive Coverage on your own auto insurance policy.

If you do not have Collision and/or Comprehensive Coverage on your own policy and the damage is the result of negligence of another, your only remaining option is to collect from the negligent party who caused the damage. Hopefully, that party will have Liability Insurance that will pay you on behalf of their insured. If another party is responsible for your damage but does not have insurance, your only remaining option is to pursue your claim against the negligent party personally.

If the responsible party does not voluntarily pay for your damages, you may have to pursue legal action against them. If your total damage is $5,000.00 or less (contact Justice Court or Small Claims Court in your area to verify their authority limit), you can utilize the services of Justice Court. A Justice Court action can be rather quick (less than 3 months), is relatively simple and can be pursued at a minimum of cost. If your damage is over the limit of Justice Court, you will have to bring your action in Superior Court which will be much slower and probably much more expensive (legal representation is recommended). The moral here is simple: if you can not afford to do without it . . . insure it!

If you are fortunate enough to have the option of collecting for your vehicle damage from either your own insurance company or the other party's insurance company, we recommend you utilize your own coverage. We make this recommendation for three reasons . . .

1. In most states, your insurance company can not increase your future auto insurance policy premiums for claims submitted which did Not involve negligence on your part.

2. Your own auto insurance policy affords you Rights that you do Not have in your dealings with they other party's insurance company. Chief among those rights is your access to a quick and cost effective process for resolving disputes. This will be discussed in greater detail in question #11.

3. In the event your vehicle is a legitimate candidate for a Post-Repair Diminished Resale Claim, you do not want to exhaust the coverage limits of the other party's insurance just for repairing your vehicle. Post-Repair Diminished Resale Claims are discussed further in question #9. If the repair of your vehicle even begins to approach $10,000.00, use your own Collision Coverage.

Using your own Collision Coverage may mean an investment on your part in an amount equal to your policy deductible. However, the other party's insurance company will probably be happy to pay you your deductible . . . up front! That would minimize the need for capital commitment on your part while still leaving your options open. Now that we have dealt with the "who" . . . let us now address the question of "How much".
Go back to the top.

How Much Will Be Paid ?

Generally speaking, the maximum that will be paid for damage to your vehicle will be the amount necessary to replace your vehicle with a comparable used vehicle (plus sales tax, title and registration fees). This is referred to as the vehicle's ACV (Actual Cash Value). An exception to this rule would be if you had purchased an RCV (Replacement Cost Value) endorsement as part of the Collision and Comprehensive Coverage on your own insurance policy. That would raise the maximum collectable to an amount necessary to replace your vehicle with a comparable new vehicle. These amounts would be collectable if your vehicle claim were to be resolved on a Total Loss basis.

If the damage is not severe enough to Total your vehicle, you are owed whatever amount is necessary to return your vehicle to its pre-loss condition (and in some cases, pre-loss value). To learn more about being paid for Diminished Value of your damaged / repaired vehicle, go to our Auto Diminished Value FAQs section.

If your vehicle is reparable, you need to be aware of Two Factors that Could prevent you from receiving the best in quality repairs. 1 - DRP Contracts. DRP is the generic term referencing a Direct Referral Program. This is where insurance companies and repair facilities have entered into a business relationship whereby the insurance company receives concessions from the repair facility in exchange for an insurance company referring work to that facility. In some cases, those concessions are merely administrative in nature. The repairing facility is left to determine how the vehicle will be repaired. However, in other more restrictive relationships, the repairing shop will have forfeited full control of the repair process to the insurance company. Insurance company Bean Counters will determine whether a damaged component will be repaired, replaced or even addressed at all. It is this 2nd scenario that poses a great potential for post-repair defects. We have even seen some DRP contracts that do not permit the repairing shop to tell the vehicle owner about improperly repaired (or unrepaired) damage. Note: To say that all DRP Shops will turn out Poor Repairs makes no more sense than to say all non-DRP Shops will turn out Quality Repairs. The quality of repairs you receive has more to do with a shop's dedication to customer service than whether or not they may have entered into any DRP contracts. All of the pro-Consumer shops listed in our Local Body Shops section are totally dedicated to your best interests and complete satisfaction. 2 - AfterMarket Crash Parts are imitation sheet metal, plastic or lamp components made as Knock-offs to original factory components. Such parts are inferior at every level, are Cheap in every sense of the word and, in some cases, present a severe safety hazard. I-Can Does Not Endorse the use of AfterMarket Crash Parts. I-Can has a very low opinion of Insurance Companies that mandate the use of these inferior parts. Such insurance companies are those requiring the more restrictive DRP relationships as referenced above. Note: Any I-Can Local Body Shop found to have installed an AfterMarket Crash Part, without prior approval of the vehicle owner, would be subject to immediate suspension.
Go back to the top.

How Many Estimates Must I Get ?

The short answer is one (1). As you are the owner of the damaged vehicle, you have the right to select what shop will be making the repairs. In point of fact, you will probably not even have to get any repair estimates as most insurance companies have their own appraisers to evaluate the damage to your vehicle. What you need to do is make sure you have chosen a quality repair facility to do the work on your vehicle and then just let that shop deal with the insurance company.
Go back to the top.

Must I Accept Used Parts ?

In short . . . yes! However, do not stop here. Read on to understand the "why", "when" and "what" that put limitations on used parts. Virtually every auto insurance policy I've ever read had an "LKQ" clause. L.K.Q. stands for Like Kind & Quality. While this means that insurance companies can pay for used parts in repairing your vehicle , this does NOT mean JUNK parts. If your four year old vehicle needs to have a door replaced that was in good condition prior to the accident, it would only be reasonable to replace the damaged door with an identical door in good condition. The operative word in the LKQ clause (for this discussion) is "quality". If your damaged door had soft, pliable and intact weather-strips, so should also the "used" door. If your damaged door had never been repaired before, you should not have to accept a used door that requires any repair to be usable. If an insurance company makes an allowance to replace your front end sheet metal with an "LKQ" assembly, an allowance should also be made for servicing the radiator, a/c condenser and replace the dryer and/or expansion valve so as to restore the functional reliability of these components. Used parts have a legitimate place in the repair of your damaged vehicle. JUNK parts have NO place in the repair of your damaged vehicle.

Junk parts have always been plentiful. However, the availability of good quality used parts has been unpredictable. This sporadic availability of acceptable used parts gave birth to a whole new option for insurance companies to save money versus having to pay for OEM (Original Equipment Manufacturer) replacement body parts. Now comes the "economy parts" industry. Economy parts are replacement body parts that are manufactured by someone other than the manufacturer of your vehicle. They are generally referred to as "imitation" body parts. They are of inferior quality and pose a potential hazard for future occupants of your repaired vehicle. These parts may be of like "kind" but are clearly not of like "quality" and you are not obliged to accept these parts (unless your policy gives decision making authority to the insurance company).

WARNING: some insurance companies have now begun to rewrite their policies so as to give the insurance company the right to select the repair shop and dictate what parts will be used in the repair of their insured's vehicles. This is not usually disclosed when you purchase or renew your auto insurance. Be aware of this potential problem and review it with your agent. Read your policy. Don't find out too late that you have waived your rights and surrendered control to your insurance company.

UPDATE: April, 2000 - Bob Crawford (Head of Florida's Dept of Consumer Protection) issued a "Directive" to Collision Repair Facilities that severely restricted the use of After-Market ("Competitive") Body Parts and Required Full Disclosure of their use to vehicle owners. The Insurance Industry has Sued the State of Florida (and Bob Crawford, individually) in an attempt to get that Consumer Protection Directive nullified. Bob Crawford and the State of Florida are meeting their obligation to their Consumers by Defending against the Insurance Industry's Attack.
Go back to the top.

What if Additional Damage is Found During Repairs ?

This is not an unusual situation and does not usually pose a problem. Quite often additional damage is found when the vehicle opened up. In this situation, the repairing shop will simply notify the insurance company who will probably send their appraiser back out to the shop to re-inspect the vehicle and reach an agreed price increase to repair this now disclosed damage. As long as your vehicle is being repaired by a shop whose ethics and reputation you can trust . . . you will not have a problem!
Go back to the top.

Is Frame Damage Reparable ?

In a word . . . yes! Some frame damage is reparable. The operative word here is "some"! However, with the advent of "unibody" proliferation and HSLA (High Strength Low Alloy) steel, frame repair and frame component replacement has become a field of specialization. We now have very sophisticated diagnostic and repair equipment requiring specially trained technicians.

WARNING: If the repair to your vehicle involves frame damage, make sure the repairing shop has a dedicated bench , a MIG welder and a technician who is certified by "ASE" or "I-CAR" in frame repair and welding. The technicians certificate should be on file at the repair shop and available for your inspection.
Go back to the top.

Which Body Shop Should I Choose ?

If you have been reading all the text that has appeared above, you are just beginning to understand how critical shop selection can be. You have the right to select the shop that will be repairing your vehicle. With that right comes responsibility. Do some homework! Remember, you are going to be driving your repaired vehicle . . . not the insurance company. Here are some things to consider when choosing a repair shop . . .

1. Shop should provide written warranty
2. Shop should not use "economy" parts
3. Ask to see "I-CAR" training certificates of technicians
4. Shop should have MIG welders
5. Shop should use "Weld-Through" primer
6. Shop should have a "dedicated bench"
7. Verify shop status with your State Chapter of the Collision Craftsman's Assoc.
8. Verify shop status with the Better Business Bureau
9. Tour the shop - check finished jobs and jobs in progress
10. Use this Local Body Shops link to access a list of our I-Can member shops

Choosing the right repair facility will be critical to your safety, satisfaction and peace of mind when you get your repaired vehicle back. Take the time necessary to make the right decision.
Go back to the top.

Do I Get Substitute Transportation ?

If you have Rental Reimbursement coverage on your own policy the answer is yes, regardless of who may have been at fault in the accident. If you do not have Rental Reimbursement coverage and the accident was your fault, the answer is no. If you do not have Rental Reimbursement coverage and the accident was the other party's fault and they have liability insurance, the answer is probably! You may have to front the rental expense on your credit card and then submit receipts for reimbursement. For add'l information on this subject, go to "Personal Injury Claims" and review Resolving Your Rental Car Claim. If the accident was the other party's fault and they had liability insurance but you did not incur a rental vehicle expense, this does not mean their insurance company just saved some money. There is such a thing known as a "Loss-of-Use Allowance" whereby the insurance will pay you (typically $15.00 per day) for each day you had lost the use of your damaged vehicle.
Go back to the top.

Will My Repaired Vehicle Be Worth What It Was Before The Accident ?

Probably not ! If your vehicle was substantially damaged in the current accident and has no history of significant collision involvement, you probably have sustained a post-repair reduction in the resale value of your vehicle. In most states you are entitled to be compensated, by the other party's insurance company (if the other party were at fault), for any reduction in the resale value of your repaired vehicle. In some states, you can even collect for this damage from your own collision carrier.

Generally speaking, there are three categories of Diminished Value that may affect the resale value of your collision repaired vehicle:

1. Inherent Diminished Value
This is the minimum Diminished Value that would occur simply because your vehicle now has a significant collision history. This would apply even if optimum repair results had been achieved.
2. Insurance Related Diminished Value
This form of Diminished Value would be in addition to Inherent Diminished Value. This would apply if and when an insurance company has mandated the use of inferior replacement parts and/or inappropriate procedural techniques in the repair of your vehicle. In most cases, the savings realized by short-cutting the repairs to your vehicle are more than lost by having to pay for Insurance Related Diminished Value claims.
3. Repair Related Diminished Value
This happens when the repairing facility fails to meet even the minimum standards of repair quality for which they have been paid. Repair Related Diminished Value is owed to you by the repairing shop.

To collect for this damage will require a detailed report addressing each of the Diminished Value categories outlined above. Said report should be from a recognized authority who understands appropriate collision repair techniques and is familiar with vehicle values in your local market area. Letters from Used Car Dealers are not usually sufficient. Use the D/V Professionals link here or at the top / bottom of this page to access a list of service providers qualified to define your vehicle's Diminished Value (if any) and counsel you further on collecting this portion of your claim.
Go back to the top.

How Are Total Loss Settlements Figured ?

In insurance terms, the expression "Total Loss" simply means the cost of repair + projected supplements + projected diminished resale value + projected Rental Reimbursement expense exceeds the cost of buying the damaged vehicle at its pre-accident value minus the projected proceeds of selling the damaged vehicle for salvage. This is the definition of an "Economic Total Loss". There is also what is known as a "Constructive Total Loss". No mathematics required here. If a car drives off a bridge, gets hit by a speeding train and then catches fire, that is a "Constructive Total Loss".

Whether the Total Loss was "Economic" or "Constructive", most all Total Loss Settlements are based upon the pre-loss ACV or depreciated value of the vehicle as explained in question #2 of this text. In order to define a realistic ACV it is necessary to find vehicles comparable to the Total Loss vehicle and see how much those "Comps" are being sold for. To that amount the insurance company should add sales tax, title and registration fees. Here is where there seems to be a wide disparage of opinions. The ACV of your Total Loss vehicle could vary dramatically based upon the motivation of the appraiser locating the "Comp" vehicles. As a matter of practical application, most insurance companies use an independent automated market survey service to locate "Comps" and make a value recommendation for the Total Loss vehicle. As there are more than one such automated services competing for work from various insurance companies, there is an implied incentive to have a service provide lower priced Comps which will save insurance companies money and theoretically encourage an insurance company to use that service again in the future. All too often it seems that the true market value of a given vehicle becomes a secondary consideration in these relationships. It is for this reason that more and more consumers are exercising their right to appraisal as outlined in their own insurance policy. Explanation of the appraisal process is discussed next.
Go back to the top.

What if I Do Not Agree With The Settlement Being Offered ?

What you are about to read here is yet another reason why we recommend you include Collision, Comprehensive and Rental Reimbursement Coverage on your own auto insurance policy. Incorporated into your own auto insurance policy is what is generally referred to as an Appraisal Clause. Loosely translated, that means arbitration. If you and your insurance company do not agree as to the settlement value of your auto damage claim, either you or the company may invoke the Appraisal Clause. That means you would hire an appraiser to represent your interests, the insurance company would hire an appraiser to represent their interests and those two [2] would hire a third appraiser to act as "umpire" or "Referee". In the event the first two appraisers fail to reach an agreement as to a reasonable settlement value, they would each submit their respective work product to the third appraiser for determination. If either of the first two appraisers agrees with the determination of the third appraiser, the settlement amount has been resolved and is binding on the insurance company. In this process, the insured pays the fee of their appraiser. The insurance company pays the fee of their appraiser. The insured and insurance company split the fee of the third appraiser.

The appraisal process typically takes 2-6 weeks. However, most insured need not forego receiving any settlement during this process. In most cases, you are entitled to receive the last existing offer (the "undisputed" amount) promptly. Failure of the insurance company to pay you amounts to bad faith. For more information on bad faith go to our HomeOwner Insurance Claims page and read the Bad Faith Conduct text.

Submitting your claim settlement value dispute to appraisal can be quick, cost effective and (more often than not) will result in a settlement increase. Unfortunately, your right to appraisal exists only in matters of dispute between you and your own insurance company. You have no right to appraisal in matters of dispute between you and the other party's insurance company. If the other party's insurance company does not agree to submit your dispute to appraisal, your only remaining option would then be litigation. That option is discussed further in question #1 of this text.
Go back to the top.

Judicial Measure of Damage …

If, when dealing with the at-Fault party’s insurance company, you find you are unable to reach a fair and reasonable claim settlement value and litigation appears to be necessary, you should be aware of how courts traditionally define the amount owed in Property Damage Liability cases.

With its roots in Old English Common Law, there has existed a Judicial Measure of Property Damage that even pre-dates the founding of our nation. This standard has been so widely applied, for so many years and in so many jurisdictions, that for a court to Not apply this standard has become a Rare Exception.

This Judicial Measure of Property Damage says [paraphrased] …

“The Fair Market Value of Property immediately Before Damage … Less the Fair Market Value of Property immediately After Damage … Plus a reasonable allowance for Loss-of-Use.”

The Difference in Value immediately Before Damage … and the Value immediately After Damage is commonly referred to as Immediate Diminished Value.

In many cases, simply Repairing the Damage to a vehicle will Not restore it to “The Fair Market Value of [your vehicle] immediately Before Damage”.

The short-fall between the Fair Market Value immediately Before the damage … and the Fair Market Value After the Repair … is commonly referred to as Residual Diminished Value.

4/16/09

Auto Insurance Claims - Totaled older car; police ticket not admissible evidence

Question:
My daughter was driving her auto in a college parking lot and was struck by another vehicle damaging her auto. Nobody was hurt but the damage to her car was extensive. The driver of the other vehicle admitted fault and both the college police as well as the local city police responded. The city police issues a citation to the other driver failure to yield the right of way. My daughter is not covering collision insurance on the vehicle due to the age of the vehicle, however the auto is worth fixing as it is a reliable automobile. Is the other drivers property insurance liable to fix the damages to my daughters auto since the citation stated fault on the other party? Thanks for your response.

Answer:

Totaled older car
Repair with non-OEM parts
Repair with used parts
Salvage totaled vehicle
Higher actual cash value research
Ticket does not prove negligence
Police ticket not admissible evidence
Issued ticket fight comparative negligence
No comparative negligence

Dear Clients,

Yes, the other driver has an obligation to repair your daughter's car. If he has insurance, then you can make them pay. Just make that claim with them, and if there is any problem, contact your State Insurance Commissioner http://www.settlementcentral.com/links.php. Don't be afraid to make a complaint should the insurance adjuster give her any problem.

Here is one thing I think could cause you a problem, based upon what you told me:
"the damage to her car was extensive. My daughter is not covering collision insurance on the vehicle due to the age of the vehicle; however the auto is worth fixing as it is a reliable automobile."

So you have an older vehicle that has extensive damage. I am going to bet it will be totaled, not repaired. If the car is not worth insuring, then you may find that the repair costs are above 70% of the value and the adjuster will want to total it instead of repairing it. We see this all the time with older vehicles. Guess what? Your daughter will never get enough money from having her car totaled to buy any kind of reliable transportation.

Thus, just in case this turns out to be the case, I am going to give you some extra information on how to deal with this problem.

THREE IDEAS FOR COMBATING AN OFFER OF AN UNDERVALUED VEHICLE THAT THE INSURANCE AGENT WANTS TO TOTAL

• First, consider lowering the repair cost by repairing with USED and/or NON-Original Manufactures' Equipment (OEM) PARTS and stipulating to ignore some cosmetic damage; that will allow the insurance company to do the repairs within the percentage of allowance of actual cash value that it has already specified; OR
• Second, buy back the car from the insurance company as salvage, repair it, re-title it, re-license it, and KEEP YOUR CAR; OR
• Third, fight the actual cash valuation with your own research and communicate in writing.

Here are the details on those three choices.

A.) SAVE YOUR DAUGHTER'S CAR FROM BEING TOTALED BY REPAIRING WITH USED and/or NON-OEM PARTS and STIPULATING TO IGNORE SOME COSMETIC DAMAGE.
Before we get started, have you thought about keeping your daughter's car? Many times people have put a lot of money into maintenance OR EXPENSIVE REPAIRS (i.e. new transmission) in a high mileage vehicle, and they KNOW what they have will work as reliable transportation for them.

Have you considered whether or not YOU want your car "totaled"? Do you know whether or not the money you will receive will buy you anywhere near the same quality of transportation that you enjoy with your present vehicle? Will you have to incur a loan payment to get adequate transportation? What if you put a lot of money into repairs and new parts in the past 18 months? You will not get that money back in cash value of the car, but the repairs may have made your vehicle desirable to continue operating.

So, rather than taking the low offer of cash and trying to find a vehicle that will be reliable, they put the money into fixing the wreck with used parts, leaving aside cosmetic damage (who cares if your daughter drives a nine year old car with some bumps and bruises -- especially when that will reduce the repair bill a ton??).

So the first thing, if you are happy with the performance of your car, and if you have put a lot of money into maintenance or repair, as you have, would be to explore ways to keep the car.

Ask what the body shop would charge to repair your vehicle with USED and/or NON-OEM parts. You can negotiate to leave some cosmetic damage showing to save money. I would not be surprised to see up to 40% come off their repair bill in that case. If you have a car that was running fine, why not keep it, even if you have to drive around with some dents showing?

Find out the maximum amount that the insurance company will pay for repairs before they elect to total your vehicle. Then arrange for your repairs to be done within that limit. This is my first choice and better if you can make it happen. If the adjuster still wants to total your car, then you have to go to the next step.

B.) BUY BACK CAR FROM INSURANCE COMPANY, REPAIR IT, RE-TITLE AND RE-LICENSE IT, AND KEEP IT. YOU GET YOUR EQUITY, LESS THE SALVAGE VALUE THAT YOU PAY TO BUY IT BACK AND THE COST OF REPAIRS PLUS INSPECTION AND RE-LICENSING COSTS.
Here is one way to get the insurance adjuster at her own game. Let's say that you value your car at $5,000, but the insurance adjuster, after considering the latest documentation you have to offer, values it at only $2,800. Don't forget, that is her value BEFORE THE ACCIDENT.

One would have to consider the amount of damage done in the accident to come up with a salvage value, but it should be a lot lower than the value before the accident, which the adjuster already told you was only $2,800. So, before you decide to total the car, ask the adjuster what the salvage value would be. That is the amount that the company will get for the car after the accident, in its post-accident state, without any repairs having been made. In this example, depending upon the cost of the repairs, the salvage value could be around $700. Hey, this is ONE advantage of having them give your car a low actual cash value: the salvage value should be pretty low!

NOW, if you were to pay that amount and then to set up the repairs to be done with USED and/or NON-OEM PARTS, and perhaps forgoing some of the strictly beauty finishing items, you could get repairs done for a lot less than the estimate given to the insurance company. Say, around $1,400.

Plus, once the car is repaired, you will have to take it to the state patrol to be inspected as a salvaged vehicle. You will need paperwork from both the insurance company and the auto body shop that confirms both the amount you paid for the salvage, the fact that you are authorized to title the vehicle, and a receipt for the work and parts from the auto body shop. You pay for the inspection and then the re-licensing through the Department of Licensing. So leave aside around $100 for the state inspection, plus the cost to get new title, license plates, and tabs. The cost for the latter will be the same for any other vehicle of the same price as your salvage buy-back price.

Here is how the math would work out. You get the actual cash value that you and the adjuster agree upon, which is going to be $2,800 in this case. Then you have to buy back the car from the insurance company, which in this case will be the $700 salvage.

You will have the auto body company authorized to repair with USED and/or NON-OEM PARTS, which in this case, will bring the cost of $1,300 (thus, for state licensing fees, the "value" of the car to you is what you paid, or $2,000: $700 plus $1,300). To that you will add the cost of inspection ($100) and re-licensing (say 8% sales tax times the salvage buy-back price of $2,000, equals $160).

In summary, you got $2,800 cash for the car, and you paid out $700 plus $1,300 to get it repaired and ready for inspection and licensing, which are $100 and $160, respectively. Thus, your total out-of pocket outlay will be the $700 plus the $1,300 plus the $100 plus the $160, for a grand total of $2,260. So your daughter comes out with a repaired and re-titled car and $540 in her pocket.

C.) THIRD, FIGHT THE ACTUAL CASH VALUATION WITH YOUR OWN RESEARCH AND COMMUNICATE IN WRITING.
Now, changing topics back to how to get that value up for the insurance adjuster, let's get started for you. The first tasks are to get at the actual cash value and next throw out that outrageous offer that we expect they will make to your daughter.

My favorite sites for valuation are www.Edmunds.com and www.autotrader.com. They want to know your zip code, and then they ask for a range in miles to search. Don't limit yourself to your city: it is reasonable that someone could go up to 300 miles to pick up a used car. That way you will get a lot more information. Be aware that you should pick the option "any distance" from your zip code. You can use information from local papers, advertising flyers, car dealerships, and the Internet.

Be aware that the prices shown are the "asking" price, not the actual cash value. But also be aware that the insurance adjusters have used a computer scan of sales that were at the trade-in value, NOT the actual cash value.

If you have made major item replacements, above and beyond normal maintenance, you need to document them and ask for a review of those extras. For example, a rebuilt transmission or the like will add value to a used car. How about new tires or a new stereo system? The issue is: how much (if any) did they increase the FMV or actual cash value of the car. See this link and scroll to the bottom for more information on that topic. Car Accidents: Totaled, Repair, Valuation, Your Rights http://www.settlementcentral.com/page0007.htm

That should be more than enough information to help your daughter retain her vehicle.

I trust that my extra time here has produced some information that has been of value to you, and thus I would respectfully request that you take the time to locate the feedback form on this site and leave some feedback for me.

3/1/09

First thing that comes to mind when I say "un-insured drivers"?

First thing that comes to mind when I say "un-insured drivers"?

Answer:

The first thing is irresponsibility.

The second is a degree of sympathy because people are so dependent on cars to work and live while insurance is so high.

That sympathy is dulled by two factors:
(1) If it costs them too much to insure, they certainly do not have the resources to act responsibly if they cause injury, property damage, or death.
(2) Many people are completely unwilling to explore the possibility of using public transportation or walking.

In most states, it is not insurance that is required, but proof of financial responsibility. One can self-insure, but one must show proof of ability to act responsibly toward others.

It is simply the Golden Rule.

8/26/08

Do I Need Uninsured Motorist Coverage on My Auto Policy If I Have Medicare Or Health Insurance?

This is a very common question that we encounter in our practice. I’ve even heard of insurance agents who expressed the opinion that people do not need uninsured motorist coverage on their auto policy if they have health insurance or Medicare. The reasoning seems to be that following an accident their medical bills would be covered. Unfortunately, this reasoning fails to take into consideration all of the other benefits available from uninsured motorist coverage to someone who’s been seriously injured in an auto accident or to the estate of someone who has been killed.

The purpose of uninsured motorist coverage is to compensate the insured for all of the elements of damage they would have been entitled to receive from the person causing the accident, but who carried no bodily injury insurance, or very low limits of coverage. In Florida, those damages would include: pain, suffering, disability, scarring, disfigurement, mental anguish, loss of the enjoyment of life, lost earnings and earning capacity, as well as unpaid medical expenses incurred in the past, and those to be incurred in the future. Of this list of damage items, the only ones which would be covered by health insurance or Medicare would be “covered” medical expenses. Beyond having their medical expenses paid, someone carrying no uninsured motorist coverage, who was struck by an uninsured driver, would receive no compensation for all of the other elements of damage described above.

No one ever believes they will be involved in a serious motor vehicle accident. But every day throughout the state of Florida, hundreds of people are seriously injured who also believed it would never happen to them. Following a serious accident, the injured person will immediately begin to consider, who will compensate them for the substantial losses they have incurred and those which will be incurred in the future. Losses such as pain, suffering, loss of enjoyment of life, as well as loss of earning capacity and earnings are very commonly encountered in relatively routine motor vehicle accidents. In the more serious accidents, all of these losses may be incurred, particularly those which involved the death of a loved one. People naturally become angry and frustrated when they have been struck by an uninsured driver, only to discover their own policy of insurance does not include uninsured motorist coverage.

There is something else to consider about carrying only Medicare or health insurance. If there is any liability coverage available to provide compensation of one’s injuries, even though it may be woefully inadequate, Medicare and virtually all health insurance policies, have reimbursement rights. Federal statutes require reimbursement of benefits provided by Medicare and employer sponsored health insurance plans when the injured person receives compensation for their injuries. Most other health plans contain reimbursement rights which are regulated under state law, including Florida. This means that when someone’s health insurance or Medicare provides benefits to them following an accident, those benefits are subject to being paid back if the injured person is successful in getting even minimal compensation from the party responsible.

Therefore, the only way someone may protect themselves is to carry the maximum amount of uninsured motorist coverage they can afford. We urge our clients to examine their declaration sheet on their auto policy, determine what coverage they actually have purchased, and call their agent to get a quote for uninsured motorist or additional uninsured motorist coverage.

7/26/08

Q&A Auto Insurance

What car insurance companies DON'T use a credit score when deciding rates?

whether you're against it or not, it's a factor. and sorry, i don't know of ANY companies out there that don't use it. i know about 99% use credit scores, so good luck finding the one or two that havent jumped on that wagon... yet. I've bookmarked this site to go back to... http://www.safelinked.info/go.php?link=insurance All the best to you.

Q&A Auto Insurance

7/25/08

Auto Insurance?

I recently bought a car and I have no idea what auto insurance is good and has great deals. Can anyone help me? Keep in mind I'm on a budget. Does anyone know what is a good company for me?

You can try:

Freeway Insurance
Esurance
Progressive
The General
Dashers

These are all cheaper insurance brokers. In the end it will mostly depend on the coverage you need, where you live, you're driving record, etc.

Some of the better but more expensive companies are:

AllState
AAA
Farmers
State Farm

6/29/08

Q&A Auto Insurance

I have liability insurance. If I lend my car out to a friend, will my insurance pay in case of an accident?

Best Answer
Yes. However, does he have regular access to your car? If he borrows it more than once a month, or more than ten times a year, you should add him as an operator. Also, if he cracks it up, it's great that the other guy is covered, but . . .can you afford to buy a new car? Because you won't have any coverage for YOUR car.

What car insurance companies DON'T use a credit score when deciding rates?

Best Answer
whether you're against it or not, it's a factor. and sorry, i don't know of ANY companies out there that don't use it. i know about 99% use credit scores, so good luck finding the one or two that havent jumped on that wagon... yet. I've bookmarked this site to go back to... http://www.safelinked.info/go.php?link=insurance All the best to you.

6/20/08

101 Auto Insurance

Top things to know
EMAIL | PRINT | DIGG | RSS Subscribe to Top Stories

Paste this link into your favorite RSS desktop reader
See all CNNMoney.com RSS FEEDS (close)
In Lesson 22

Glossary
Take
the test

Top things to know

Why insurance costs so much

1. You're a statistic.

To an insurer, you're not a person, you're a set of risks. An insurer bases its premium (or its decision to insure you at all) on your "risk factors," including some things that may seem unrelated to driving a car, including your occupation, who you are, and how you live.

2. Insurers differ.

As with anything else you buy, what seems to be the same product can have different prices, depending on the company. You can save money by comparison shopping.

3. Don't just look at price.

A low price is no bargain if an insurer takes forever to service your claim. Research the insurer's record for claims service, as well as its financial stability.

4. Go beyond the basics.

Most states require only a minimum of auto-insurance liability coverage, but you should look for more coverage than that.

5. Demand discounts.

Insurers provide discounts to reward behavior that reduces risk. However, Americans waste some $300 billion a year because they forget to ask for them!

6. Ask for the real thing.

Insurers cut costs by paying only for car parts made by companies other than the car's manufacturer. These parts can be inferior. Demand parts by the original equipment manufacturers (OEMs).

7. At claims time, your insurer isn't necessarily your friend.

Your idea of fair compensation may not match your insurer's. Your insurer's job is to restore you financially. Your job is to prove your losses so you get what you need.

8. Prepare before you have to file a claim.

Keep your policy updated, and re-read it before you file a claim so there are no surprises

5/26/08

auto insurance

I have liability insurance. If I lend my car out to a friend, will my insurance pay in case of an accident?

Yes. However, does he have regular access to your car? If he borrows it more than once a month, or more than ten times a year, you should add him as an operator. Also, if he cracks it up, it's great that the other guy is covered, but . . .can you afford to buy a new car? Because you won't have any coverage for YOUR car.

3/28/08

Most popular Car insurance questions and answers from FAQs:

How long do tickets and accidents affect your insurance in Ohio?
According to the Ohio's Bureau of Motor Vehicles, there is no section of the Ohio Revised Code (ORC) that states convictions ever come off of a person's driving record. Your OH auto insurance premium can go up if you cause an accident or have a moving violation. The company can raise ("surcharge") your premium if you are at fault in an accident or if you get several traffic tickets. But, you should not be surcharged for a minor moving violation or a single accident that was not your fault according to the Ohio Insurance Department of Insurance. Premiums cannot change until your next renewal date either according to the DOI. Different companies have different rules. Many do not consider incidents that are more than three years old, but some auto insurers will look back as far as five years in Ohio. If it has been over 3 or 5 years since your last ticket or moving violation conviction it does not necessarily mean that your insurance company will automatically lower your premium. The Ohio Insurance Department of Insurance notes that periodically you should ask your insurer to review your premium to make sure you are getting the best rate possible. Also, as your driving record improves, it may be time to start shopping for a better deal.
What is the minimum car insurance coverage allowed in the state of Ohio?
What we mean is coverage on injuries and damage to the other driver. The Ohio State law requires motor vehicle financial responsibility in the minimum amount of $12,500 for bodily injury or death to one individual in any one accident, $25,000 for bodily injury for two or more individuals in any one accident and $7,500 for injury to the property of others in any one accident. This financial responsibility (FR) law is not a compulsory automobile insurance thus no motorist is forced to buy auto liability insurance. The law does require drivers to be insured or have other arrangements to pay or injuries and damages they cause in the event of a crash. FR must be maintained and should be proven to the OH Bureau of Motor Vehicles in one of several ways. For more information you can go to Ohioinsurance.org. If you are searching for Ohio insurance look no further for an OH affordable car insurance quote.
How can I find out how many points I have on my PA license and how long does it take for them to be removed?
You may request a three-year or ten-year copy of your driver's history by using Pennsylvania"s Driver and Vehicle Services Online Services by completing a 'Request for Driver Information' form and submitting it to PennDOT. Certified histories are only available by completing this driving record request form (Form DL-503). The form contains detailed instructions and lists fees for different types of driving records. By receiving a copy of your driving history from PennDOT you will be able to see how many points you have accumulated on your record so far. The Driver and Vehicle Services portion of the Pennsylvania Department of Transportation (PennDOT) maintains a driving record for every licensed driver in Pennsylvania. Points are added to the driving record (associated with your driver's license) when the driver is found guilty of certain driving (moving) violations. PennDOT allow points to be removed from your driving record for safe driving. You can get 3 points removed from your driving history for every 12 consecutive months (from the date of the last violation) you go without a violation, which results in points, license suspension or revocation.Once a driving record is reduced to zero and remains at zero points for 12 consecutive months, any further accumulation of points is treated as the first accumulation of points.
I live in Ontario, Canada and got a traffic ticket in Oregon for 18 mph over with $145 fine. Will that affect my points and insurance? Should I pay for the fine?
According to the information we were able to gather, all provinces in Canada have a reciprocal agreement with Ontario regarding moving violations. Ontario also has agreement with 41 states, including Michigan. See the bottom of this answer for a list of all the states Ontario supposedly has some type of reciprocal agreement with. If the Oregon speeding ticket is placed on your Ontario, Canada driving record, than your insurance company could see if the next time they pull your MVR and thus your rates may be affected. The following states in the U.S. have a reciprocal agreement with Ontario: Alabama, Arizona, Arkansas, Colorado, Connecticut, Delaware, District of Columbia, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maryland, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Utah, Virginia, Washington, West Virginia, Wisconsin and Wyoming. We would always advise for a driver to comply with a moving violation by either paying the fine, fighting it in court or another legal remedy. Without taking care of a ticket that is received out of state or even out of country there is the chance that the state that issued the citation will come after you and affect your license. Plus if you have a failure to appear on your record in Oregon it could affect your driving privileges if you travel there again, plus if you do pay the find after the court date the fine and court fees are likely to be higher than if you paid on time.The Ministry of Transportation (MOT) for Ontario may be able to give you more information on the reciprocal agreements they have with various states and how a ticket in Oregon could affect your license in Ontario.
I live in Texas and my car was totaled and it was not my fault. Is there a way to keep my car and get the most money the insurance will give me to fix my car?
And could I sue to make up for the difference. If you want to keep your car then normally you would request this of the insurance company and if they allow you to do so then the salvage value of the vehicle is taken out of the settlement (for the car's actual cash value) you would receive for the vehicle. When you take a settlement for the car's ACV then you usually cannot sue the driver for additional monies. According to the Texas Department of Insurance (TDI) consumer for auto insurance, an insurance company will pay for repairs or replacement only up to the car's actual cash value. Actual cash value is the amount that your car would have sold for before the accident The car insurance consumer guide speaks about the issue you are having by noting that sometimes the insurance company may want to total your car, but you would prefer to have it repaired instead. You normally can keep your car if you are willing to subtract its salvage value from the insurance settlement. First make sure the cost to repair the car will not exceed the car's actual cash value. To find out the salvage value, contact local salvage yards for estimatesIf your insurance company totals your car but you cannot reach an agreement on the amount to be paid, you can demand an appraisal. Appraisal allows you and the company to hire separate damage appraisers. The two appraisers choose a third appraiser to act as an umpire. The appraisers then review your claim, and the umpire rules on any disagreements. The appraisal decision is binding, but only as to the amount of the loss.
What is an SR-22 form?
SR-22 insurance varies state to state. The basic definition of an SR-22 form is available on our Insurance Terms page. SR-22 isn't a type of insurance, but rather proof that you have certain types of insurance (based upon the financial responsbility laws of your state). Simply, it is a form which must be filed by the insurance company to the state (Department of Motor Vehicles) stating that auto liability insurance is in effect for a particular individual.Typically it is required when insurance is provided to an individual who was in an accident or was convicted of a traffic offense and was unable to show financial responsibility OR if a judge has ordered an SR22 for other reasons (in some states).
I just got a speeding ticket. How much will it affect my auto insurance premium?
If it was your first ticket, you might not see any change in your rates. Some states have laws governing when and why auto insurers can change policyholders' premiums; often, insurers are not allowed to raise your rates after just one speeding ticket or other citation. Different companies have different practices when it comes to raising premiums. Some companies will consider the severity of your violation and raise your rates accordingly; others will raise rates a specific amount per violation. Because there are too many factors to simply say it will be $50 more a year, here is a real example: The average New York auto insurance policy costs $1313 a year. If you have a clean driving record then most New York companies offer a discount. That discount is typically a 25% savings ($328). So, using these averages a driver with a clean driving record is paying $985 a year for car insurance.One speeding ticket would remove that discount and increase the base rate by 2%. That is a $354 increase a year, or $1062 over 3 years (companies usually surcharge for 3 years).
What happens when my car is totaled in an accident?
When your car is totaled, the insurance company has an obligation to "make you whole," as that is defined in the policy. Most policies value your vehicle using Actual Cash Value. "Actual Cash Value" means replacement value less depreciation. This essentially means you have to be left in approximately the same financial position (with respect to the item insured - not in respect to any liens or leases that hold title to your car) you were in before the accident.If you have physical damage coverage (comprehensive and collision) the insurance company will typically write you a check for the actual cash value of the vehicle, minus any deductible on your policy. If you are "upside down" on your loan or the cash value is less than your current loan amount ("Upside down" means owing more on a car than it's worth.) then you should consider GAP insurance. In this situation, if you don't have GAP insurance then you would be responsible toward your loan for the remaining balance. The terms of that payment are set through you loan contract.
I just received a speeding ticket out of state from the state which issued my license. My home state DMV does not record out-of-state tickets, and the points or incident do not appear on my driving record. Is there any way that my insurance company will still find out about this, and will my rates increase?
It is always possible that your state may learn about this incident. If they do and if it was your first ticket, you might not see any change in your rates. Most states have reciprocal arrangements and provide ticket information to the driver's home state. Some states are members of the driver"s license agreement (DLA) which means they share information between their motor vehicle departments. Members of this agreement have different rules to what they transfer over and if points are accessed, etc. Some states have laws governing when and why auto insurers can change policyholders' premiums; often, insurers are not allowed to raise your rates after just one speeding ticket or other citation. Different companies have different practices when it comes to raising premiums. Some companies will consider the severity of your violation and raise your rates accordingly; others will raise rates a specific amount per violation.Get car insurance quotes here to determine how this could affect your premiums.
What is an auto insurance policy?
An insurance policy is a legally binding contract between an insurance company and the person who buys the policy, commonly called the "insured" or the "policyholder." In exchange for payment of a specified sum of money, called the "premium," the insurance company agrees to pay for certain types of loss or damage as specified by the contract. When a loss occurs which meets all of the requirements described by the terms of an insurance policy, the loss is said to be "covered" by that policy.
What is an "insurable interest"?
A person has an "insurable interest" in something when loss or damage to it would cause that person to suffer a financial loss or certain other kinds of losses. For example, if the house you own is damaged by fire, the value of your house has been reduced, and whether you pay to have the house rebuilt or sell it at a reduced price, you have suffered a financial loss resulting from the fire. By contrast, if your neighbor's house, which you do not own, is damaged by fire, you may feel sympathy for your neighbor and you may be emotionally upset, but you have not suffered a financial loss from the fire. You have an insurable interest in your own house, but in this example you do not have an insurable interest in your neighbor's house. A basic requirement for all types of insurance is the person who buys a policy must have an insurable interest in the subject of the insurance. You have an insurable interest in any property you own or which is in your possession.For purposes of life insurance, everyone is considered to have an insurable interest in their own lives as well as the lives of their spouses and dependents. For property and casualty insurance, the insurable interest must exist both at the time the insurance is purchased and at the time a loss occurs. For life insurance, the insurable interest only needs to exist at the time the policy is purchased.
How does an insurance policy "protect" me?
Insurance policies offer protection against economic loss, that is, loss or damage which can be measured in purely financial terms and compensated by money. For example, an insurance policy can pay for the cost to repair or replace a damaged automobile or to rebuild a building damaged by fire, for the cost of medical treatment for an injury or illness or for the lost income of a person who dies or is unable to work. The purpose is to place the injured party, as nearly as possible, in the same financial position as if the loss had not occurred.It is important to understand this limitation of insurance, since there are many types of losses which can not be compensated by money. For example, insurance can not replace a life or take away the emotional injury or pain which often accompanies an accident or serious illness or compensate for loss of the "sentimental" value of an item of property. When you buy homeowners property insurance, for example, you are insuring only the economic value of the home, i.e., the cost to repair or rebuild it.
Are there any government agencies that regulate how insurance companies operate?
Insurance companies in the United States are regulated primarily by the individual states. There is no federal regulatory agency that oversees insurance companies. The name of the insurance regulatory agency typically is "Department of Insurance", "Division of Insurance," "Insurance Bureau" or something similar. This agency is headed by a state government official usually called the "Commissioner of Insurance", "Director of Insurance", or a similar title. The Commissioner of Insurance is an elected official in some states and in other states is appointed by the Governor. A primary function of each state's Department of Insurance is to assure that insurance companies operating in the state are financially sound, so that the company will have the financial ability to meet its obligations to pay claims. Insurance companies are required to meet certain financial requirements and are required to demonstrate periodically (at least annually) to a state's Department of Insurance that they continue to meet or exceed the minimum financial requirements in order to continue to conduct business in the state. The Department of Insurance can take various actions against an insurance company that fails to conduct its business in a financially sound manner, including action to cause the company to cease operation in the state.Most states have laws regulating the conduct of insurance business to ensure fairness in the way companies deal with applicants for insurance and policyholders. One of the functions of a Department of Insurance is to enforce these so-called "unfair trade practices" and "unfair claims practices" laws by investigating complaints by consumers and taking action, when appropriate, to get companies to stop conduct that violates the laws and impose penalties for violations. Other duties of a Department of Insurance include reviewing and approving the policy forms used by insurance companies and approving rates charged for various types of insurance to assure compliance with state laws that regulate insurance rates.
Why do I need automobile insurance?
Your automobile is a valuable asset which could be very expensive to repair or replace if is damaged. Part of what auto insurance does is to pay for the repair or replacement of a vehicle which is damaged either as a result of your driving or from other causes not related to driving, such as theft or storm damage. Without insurance, many people would be unable to replace vehicles that are stolen or become severely damaged. Auto insurance also covers your legal liability which could arise if you injure another person or damage another person's property with your vehicle. Depending on the extent of the damage or injury caused, the potential amount for which you could become liable is far in excess of the value of your automobile, perhaps in the hundreds of thousands of dollars or more. Auto liability insurance pays the damage for which you become liable, up to the dollar amount of liability coverage that you purchased. Without auto liability insurance, all of your personal assets could be at risk.If you are sued based on operation of your vehicle, auto insurance also pays for the cost of your defense. Defending a lawsuit in court can be very expensive, even if ultimately you are found not to be legally responsible for any damages.
Are there any limitations on what an insurance company can charge for insurance?
For each type of policy, insurance companies have a range of premium levels that may be charged based on various factors that are considered at the time an application is submitted. For example, the premium for an auto insurance policy will vary depending on the applicant's driving habits, such as number of miles driven and whether the auto is used for business, the age and model of the vehicle, and whether the applicant has recently been convicted of a traffic violation. The premium for a life insurance policy will vary depending on the applicant's age and health condition. Rating factors must be reasonably related to the risk being insured, and state law often limits the specific rating factors that may be considered for certain types of insurance.The rates and rating factors for most types of insurance must be filed with the insurance regulatory agency for each state where the insurance is to be sold. In some states and for some types of insurance, the rates must get regulatory approval before they can be used.
What should I know about auto insurance?
Some people think of it in terms of "us versus them." Some of us have lives and property worth protecting and believe that there are people who have nothing, will never amount to anything and will take advantage of us anytime they can. Those of us who care purchase insurance for what we have to protect and keep it. In our modern society, the orderly transfer of risk between the members of our society is accomplished through insurance. In exchange for a known loss (payment of an insurance premium), the risk of a large catastrophic loss (payment of thousands of dollars for damage to property) is transferred to the insurance company through the insurance policy. In auto insurance, there is first party coverage and third party coverage. First party coverage covers you and your property (such as medical expenses, damage to your vehicle and the insurance company's duty to defend you in the event that you are sued as the result of your operation of a vehicle, etc.). Third party coverage is for your responsibility to pay for injury caused to other people, whether in your vehicle, or another vehicle involved in the accident. The coverage (and its exclusions) is set forth in your insurance policy. In exchange for the payment of a premium, the insurance company promises to provide compensation in the event of certain occurrences. You can speak to an insurance representative to find our more about the options available to you, and their costs.. Before purchasing auto insurance, it is a good idea to shop around and buy the coverage that best suits your needs at the most reasonable price. You may wish to consider factors such as customer service, claims paying ability, claims payment record, general reputation and independent rating organization's ranking. In determining what Liability Limits you should purchase, you need to consider the amount of exposure that you have. As a general rule, the more property and wealth you own, the greater your exposure is, and the greater the need for protection against claims from third parties. Often, liability limits are set as a combination of numbers, such as 15/30, which means coverage of loss of up to $15,000 per person and up to $30,000 for all injuries which occur in a single accident. Many states require a minimum amount of third party liability insurance be purchased before a you may drive a vehicle on public roads. This is referred to as the minimum liability limit. Often the minimum liability limit is inadequate to protect all of your property and wealth. Increased limits, such as 100/300 or 300/500 are very common and can be purchased at modest addition cost to you.Your vehicle itself can be covered in several different ways. Comprehensive coverage provides coverage for loss to your vehicle due to certain proximate causes (such as fire, theft, vandalism, and acts of nature). Collision covers damage to your vehicle in the event that it collides with another vehicle of object, often regardless of who is at fault in the event of an accident. Both comprehensive and collision coverage may be subject to a deductible, that is, damage to the vehicle must exceed the deductible amount before the insurance company will pay you for a covered loss. Deductibles for this coverage are available is various amounts, generally the greater the deductible, the lower the premium for the coverage.
Are there any options for resolving a dispute with my insurance company other than suing the company in court?
Arbitration?Some insurance policies contain a provision allowing or requiring arbitration of certain disputes between the insurance company and the insured, and this may include disputes regarding certain types of claims. "Arbitration" is a procedure for resolving disputes by use of neutral, private individuals ('arbitrators") as an alternative to a lawsuit, and it often is a cheaper and faster method of resolving contract disputes as compared with a court proceeding. This procedure usually is not available unless specifically stated in the policy or unless the insurance company and policyholder mutually agree to submit their dispute to arbitration. See also our section on Arbitration.
Lawsuit for breach of contract
An insurance policy is a contract between the insurer and the insured. If the insurance company fails or refuses to pay a claim which should be paid under the terms of the policy, it is in breach of the contract, and the insured can pursue all available legal remedies for the breach. This usually involves filing a lawsuit against the insurance company. If successful, the insured will be able to recover its damages, which at least will equal the amount the insurer should have paid under the terms of the policy. Depending on state law and the circumstances of a specific case, damages may also include other expenses that were incurred because of the breach as well as costs of the lawsuit.
Lawsuit for "bad faith"
All insurance policies contain an implied obligation applicable to the insurance company of "good faith and fair dealing" towards its insured. When a claim is presented, this implied obligation means that an insurance company can not simply look for reasons not to pay. Instead, the company must make a thorough investigation of the claim, must consider all reasons and circumstances that might support the claim, and must give as much consideration to the financial interest of the insured as it gives to its own financial interest.If an insurance company refuses to pay a claim that should be paid or offers to settle a claim for less than it knows the claim is worth or denies a claim without adequate investigation, this could give rise to a so-called "bad faith" claim against the insurance company, i.e., a claim that the company has breached its implied obligation of good faith and fair dealing. If the company is found to have acted in bad faith in its handling of a claim, the insured is entitled to all damages resulting from that action, including certain types of damages that would not be available just for breach of contract. In cases of extreme or outrageous misconduct by an insurance company, the insured also may be entitled to receive punitive damages.
Complaint to department of insurance
The insurance regulatory agencies of most states (usually called the "Department of Insurance" or similar name) have established procedures whereby consumers who believe they have been subjected to unfair claims handling can file a complaint against the offending insurance company. The complaint will be investigated to determine if the company acted properly and in a manner consistent with the state's insurance laws, including the "Unfair Claims Practices" laws. In some cases, the investigation may cause an insurance company to reevaluate its handling and disposition of a claim. If a company is found to be in violation of the law, this process also may result in a fine or other penalty being imposed on the company by the Department of Insurance.
Can an insurance company cancel my policy for any reason it chooses?
Once a policy is issued, the insurance company except for reasons specifically stated in the policy can not cancel it, and state laws usually limit what a company can include in the "cancellation" provisions of its policies. Typically, policies will be subject to cancellation only for failure to make required premium payments or for some type of serious misrepresentation or fraud by the policyholder.Most property and liability policies are issued for a stated policy "term", such as six months or one year. The limitation on cancellation mentioned above applies only during the policy term. Insurance companies usually can decide to discontinue or "non-renew" these policies at the end of the term for any reason except a reason that would be prohibited by law (also, in a few states an insurance company may not refuse to renew certain types of personal insurance). In most states, an insurance company must give the policyholder a written notice at least 30 days prior to the end of the policy term if it intends to non-renew a personal auto or homeowner's policy.
If I miss a premium payment and get a cancellation notice, is there anything I can do to be able to keep the policy?
For property and liability insurance, a cancellation notice usually must be sent to the policyholder several days prior to the effective date of cancellation. The notice period will be stated in the policy, and for personal auto, homeowners and sometimes other types of insurance, state law usually requires at least 10 days advance written notice. If you make your payment before the cancellation date, you will be able to retain your coverage. For life, health and other disability insurance, state law often requires insurers to allow a "grace period" of as much as 30 days after a premium payment is due before coverage can be terminated. If payment is not made within the grace period, however, these types of coverage usually will terminate retroactively to the date the premium payment was due without any further cancellation notice from the company.If your coverage terminates or is canceled because you missed a premium payment, some insurance companies may agree to "reinstate" your coverage if you make all past due payments and you certify that you are not aware of any losses that have occurred since the cancellation date. Reinstatement is discretionary by the insurance company. The law usually does not require that policies be reinstated once they have been legally canceled.
Can I cancel my policy at any time and will there be a penalty?
As a general rule, a policyholder may elect to cancel an insurance policy at any time by giving notice to the insurance company. In some cases you may be required to return the original policy or sign a "policy release", and of course you will be responsible for any premium earned through the date of cancellation. Sometimes there are financial penalties for early cancellation by the policyholder. Most property and liability policies require what is called a "short rate" penalty when a policyholder requests cancellation, which means that the company retains a disproportionate amount of the premium. For example, if you have a one year policy and you request cancellation after six months, the "short rate" penalty would allow the company to retain more than one-half of the annual premium. Also, many types of life insurance policies and annuities impose "surrender charges" if they are canceled before they have been in effect a certain number of years. A policy must clearly describe any applicable cancellation penalties or surrender charges. Once a policy is issued, the insurance company except for reasons specifically stated in the policy can not cancel it, and state laws usually limit what a company can include in the "cancellation" provisions of its policies. Typically, policies will be subject to cancellation only for failure to make required premium payments or for some type of serious misrepresentation or fraud by the policyholder.Most property and liability policies are issued for a stated policy "term", such as six months or one year. The limitation on cancellation mentioned above applies only during the policy term. Insurance companies usually can decide to discontinue or "non-renew" these policies at the end of the term for any reason except a reason that would be prohibited by law (also, in a few states an insurance company may not refuse to renew certain types of personal insurance). In most states, an insurance company must give the policyholder a written notice at least 30 days prior to the end of the policy term if it intends to non-renew a personal auto or homeowner's policy.
If I own a car, do I have to buy insurance?
Most states require auto insurance. Technically, you prove your financial ability to pay a specified level of damages when registering a vehicle or renewing license plates. The only way for most people to satisfy this requirement is to have car insurancefor the minimum amount of coverage.If you have a car loan or if you lease your vehicle, the loan company or leasing company will also require that you have insurance. You name the company as a "loss payee" on your policy. If the vehicle is damaged, any insurance payment will go to the company, and it uses the money to either to repair the vehicle or pay off the loan balance.
What is a "financial responsibility" law?
A "financial responsibility" law requires you to prove your financial ability to pay for damages at the time you are involved in an accident or are convicted of a traffic violation. This type of law does not require that you have insurance or other proof of financial responsibility at the time of vehicle registration. However, failure to demonstrate the required level of financial responsibility at the time of an accident or traffic violation can result in suspension of your driver's license or revocation of your vehicle registration. Under these laws, the requirement to demonstrate financial responsibility is not based on fault. All parties involved in an accident must show the necessary proof or face the penalties imposed by the law. Maintaining an automobile insurance policy is the most common way to comply with a financial responsibility law.
Are there legal limitations on insurance company business practices?
State insurance laws impose many requirements and limitations on the way insurance companies conduct their marketing, underwriting (determining which policyholders or risks to accept or reject for coverage) and rate making activities. In some instances, these laws also limit an insurance company's ability to cancel or discontinue coverage once a policy has been issued. In general, there are many restrictions and limitations applicable to personal or "consumer" insurance, such as personal auto, homeowners and individual or small group health insurance. There usually are fewer restrictions applicable to business and commercial insurance. The specific requirements and limitations often vary a great deal from state to state.
What happens when there is a claim?
Payment of claims is the reason that insurance exists, yet policyholders often perceive that insurance companies resist paying legitimate claims make the claims process unduly difficult. Both insurance companies and policyholders have contractual obligations which must be understood and performed to ensure the timely and satisfactory resolution of claims.
If I am sued, does my insurance company defend me in court?
When you buy liability insurance, part of the insurance company's obligation is to provide a defense for you if you are sued. The insurance company will do this by hiring and paying for an experienced attorney to represent you in court. Even though the insurance company selects the lawyer and must approve the payment of all legal fees and other expenses of the lawsuit, the lawyer represents you.
Can an insurance company refuse to sell me insurance for any reason it chooses?
It is illegal to refuse to sell insurance to someone because of the person's race, color, sex, religion, national origin or ancestry. In many states this list of "prohibited classifications" also may include (subject to various limits to change rates, marital status, age, occupation, language, sexual orientation, physical or mental impairment, or the geographic location where a person lives. Beyond the prohibited classifications, insurance underwriting decisions generally must be based on reasons that are related in some way to the risk to be insured. In most states an individual has a legal right to be informed of the reasons for any refusal to issue an insurance policy.
What is a "reservation of rights" letter?
If you are sued, the legal complaint filed against you may state several different claims, some of which may be covered by your liability insurance policy and some of which may not be covered. The insurance company is obligated to provide a defense for you if any of the claims could be covered, but the company may not be obligated to pay the damages for certain types of claims. A "Reservation of Rights" letter from your insurer is a notice that even though the company is proceeding to handle your claim, depending on what happens, certain losses might not be covered by the terms of the policy. By such a letter, the company preserves or "reserves" its right to deny coverage at a later date based on the terms of the policy.Liability policies, for instance, typically do not provide coverage for damages which you cause intentionally. If you injure someone under circumstances where the injury could have been accidental or could have been intentional, the legal complaint might allege both that your action was "negligent" and that your action was "intentional." In court, the party suing you will have to prove it was one or the other. In such a case, your insurance company may write a letter saying it will provide you a defense but it will not pay damages if the court finds you caused the injury intentionally. This is an example of a "Reservation of Rights" letter.
Lawsuit for breach of contract
An insurance policy is a contract between the insurer and the insured. If the insurance company fails or refuses to pay a claim which should be paid under the terms of the policy, it is in breach of the contract, and the insured can pursue all available legal remedies for the breach. This usually involves filing a lawsuit against the insurance company. If successful, the insured will be able to recover its damages, which at least will equal the amount the insurer should have paid under the terms of the policy. Depending on state law and the circumstances of a specific case, damages may also include other expenses that were incurred because of the breach as well as costs of the lawsuit.
What happens if I'm sued for causing a car accident and I don't have insurance?
You need to personally arrange for the defense of any lawsuits against you. This usually involves hiring an experienced car accident attorney, who can advise and defend you in court. You will have to pay the attorney's fees and other court related costs, even if you ultimately are found not to be legally responsible for the accident.If you are found to be liable for damages, a judgment will be entered against you by the court for a specific sum of money. If the injuries are severe or the damage extreme, the judgment could be a very large sum of money, potentially hundreds of thousands of dollars. If you fail to pay or are unable to pay the full amount of the judgment, the winning party may sue to collect from you. If you don't have car insurance, now is the time to protect yourself and buy an auto insurance policy.
When may an insurance company cancel my auto insurance during the term of my policy?
An insurance company may cancel a new policy any time within the first 60 days and are not required to provide you with a reason for the cancellation. A cancellation is also permitted during the terms of the policy if the premium is not paid when it is due, discovery of fraud or material misrepresentation made by you or your representative in obtaining your insurance, or by your pursuit of a fraudulent claim under your policy, or significant changes in insuring characteristics. For the situations discussed above, no cancellation is effective until at least 10 days after the insurance company mails or delivers to you a written notice of cancellation.
When may an insurance company nonrenew my auto insurance policy?
Nonrenewal refers to the termination of a policy at the expiration date. If an insurance company decides it does not want to renew your policy, it must mail or deliver to you a nonrenewal notice at least 60 days before the policy's expiration date.
Does my auto insurance policy have a grace period?
Unlike health insurance policies, auto insurance policies, do not have a required grace period. The premium is due, at the insurance company, on the date identified on the premium notice. If the premium is not received by that date the policy automatically terminates.
Can credit history be used as a reason to nonrenew or refusal to renew my car insurance?
Insurers may use credit information as one of the criteria they consider when underwriting personal lines insurance. However, it is the position of the Wisconsin Insurance Commissioner's Office that insurers should not use credit information, whether they use credit reports or credit scoring mechanisms, as the sole reason to refuse an application, cancel a new insurance policy in its first 60 days of coverage, or nonrenew an existing policy.
What affects the price of auto insurance?
When determining the rate for an auto insurance policy, insurers separate drivers into categories called classifications. Drivers are classified based on a number of different characteristics including, but not limited to, age and gender, marital status, where the vehicle is garaged, driving record, make and model of vehicle, prior insurance coverage and annual miles driven. History has shown that drivers with certain characteristics, such as a poor driving record, have a greater chance of being involved in an accident, and the drivers in those classifications must pay higher rates. While some of the classification criteria (such as age and sex) are out of your control, others, such as driving record and type of vehicle driven, are within your control.
Can the driving/accident records of my child and/or spouse have an impact on my ability to buy auto insurance?
Yes, the driving record of any licensed driver in the household will affect the decision of the insurance company to insure your vehicle(s). It can cause you to be turned down for insurance coverage or to pay higher insurance premiums.
Is there a way I can reduce my premiums?
Every auto insurer has its own package of special discounts to attract particular types of customers. Most insurance companies provide discounts for at least some of the following: accident-free drivers discount; a package discount for insuring your home and auto with the same company; multiple auto discount; good student discount; nonsmokers discount; and passive restraint discount (for vehicles with air bags or automatic seat belts). You may also consider higher deductibles for your comprehensive and collision coverages.
Can I require the insurance company to replace my car?
The personal auto policy is not a replacement policy. Coverage for your car is based on actual cash value. The actual cash value (ACV) of your car is based on the value of your car at the time of the accident, taking into account its current market value. Therefore, the insurance company's obligation is to repair the car based upon its actual cash value not its replacement cost.
What is meant by aftermarket parts?
Auto repair shops may use aftermarket and/or used parts when repairing or replacing a damaged part (i.e., bumpers, bumper covers, and associated bumper parts, etc.). Aftermarket parts are produced by companies other than the original equipment manufacturers (known as OEM parts).Auto insurance contracts do not generally specify what parts will be used. You may request that aftermarket parts not be used to repair your vehicle, but you are responsible for any repair costs that exceed the final claim settlement negotiated with the insurance company.
The other driver's insurance company wants me to sign a release on my injury claim. How long can I delay this?
Sign the release when you are satisfied with your total settlement. Get a letter from your doctor estimating the cost and length of your future medical treatment. You may, of course, consult an attorney before accepting a settlement. You have three years after the accident, under Wisconsin law, to either settle your claim or file a lawsuit.
What does comprehensive coverage provide?
Comprehensive (also called other than collision) coverage pays for damage to your vehicle resulting from fire, vandalism, water, hail, glass breakage, wind, falling objects, civic commotion, or hitting a bird or an animal. Damage from striking a deer is a relatively frequent accident in Wisconsin. It is important to know that most policies cover hitting an animal under comprehensive, not collision, insurance.Comprehensive coverage also pays if your vehicle or parts of it, such as a battery or tires, are stolen. Flood damage to your car is also covered if your auto insurance policy includes comprehensive coverage. If you carry collision without comprehensive, you are not covered for flood damage.
How is the deductible for comprehensive or collision coverage applied?
Deductibles for comprehensive or collision coverage are applied for each occurrence. A deductible is the dollar amount that you have to pay toward the loss before the insurance company begins to make payments on the loss. For example if you suffered a comprehensive loss (a deer hit) and that same day suffered a collision loss (a rock hit your windshield), your policy allows the insurer to apply two different deductibles. Many companies will waive the deductible for the windshield occurrence if you can repair it rather than replace it.
If I have my car financed, do I need to purchase auto insurance?
If you do finance the car, the financial institution (lender) will require that you have car insurance. The terms of your loan will most likely require you to provide comprehensive and collision insurance. This is because the lender considers your vehicle collateral for the loan. If your policy lapses, the bank will force coverage (obtain a policy) and add it to your loan. Forced coverage provides protection to the bank, not you, for their interest in the car and nothing else. The cost of this insurance is much higher than you would pay if you bought your own policy through a standard carrier.
Auto Insurance Coverage - How much coverage should I buy?
Given the cost of medical car, and the state of our legal system, I think it makes sense to up your coverage. The minimum is pretty much a joke, and won't cover anyone's serious injuries. Let alone if they sue you for pain and suffering. Besides, if they win a judgement, they can attach your wages, and prevent you from ever buying a home. You should do this anyway, because it's the right thing to do. Besides, the person you may end up covering may be a friend or relative riding in your car as a passenger. Don't let the asset calculation deter you. I've had at least 100/300 liability ever since I could afford it. Last year I bumped it up to the max, which I believe was 300/600.
The company wants to repair my car with non-factory parts. Can they do this?
Yes. The parts used do not necessarily have to be original equipment manufacturer (OEM) parts, but should be of like kind and quality as the parts being replaced. Ask your company about what guarantees will be given on these parts. Florida law requires the parts to be of same fit, quality and performance.
The company is refusing to pay for a CB radio that was stolen from my automobile. Can they do this?
Most companies exclude electronic equipment, such as CB radios, cellular telephones, compact disc changers, etc., unless they are factory- installed. You should review your policy and its exclusions to determine if your CB is covered. If CB radios are excluded and it was not specifically endorsed onto your policy, then there would be no coverage.
Can a company refuse to renew your policy based on the number of accidents made in the last three years?
An insurance company may non-renew your policy if you have more than one at-fault accident. If you have three or more accidents, regardless of who is at fault, the company may non-renew your policy.Please note, a company may non-renew for claims activity, regardless of accidents.

Auto Insurance

11/1/09

Frequently Asked Questions on Auto Insurance

10/25/09

Frequently Asked Questions on Auto Insurance

9/18/09

Is it necessary to hold on to old auto insurance bills?

5/31/09

In New York State, do you have to have a valid driver's license in order to get car insurance?

Auto Insurance Question & Answer

5/1/09

Auto Insurance Claims - General

4/16/09

Auto Insurance Claims - Totaled older car; police ticket not admissible evidence

3/1/09

First thing that comes to mind when I say "un-insured drivers"?

8/26/08

Do I Need Uninsured Motorist Coverage on My Auto Policy If I Have Medicare Or Health Insurance?

7/26/08

Q&A Auto Insurance

Q&A Auto Insurance

7/25/08

Auto Insurance?

6/29/08

Q&A Auto Insurance

6/20/08

101 Auto Insurance

5/26/08

auto insurance

3/28/08

Most popular Car insurance questions and answers from FAQs:

Blog Archive

Your Special Solution