The word “combining” may be a little misleading.  You still have an auto-specific policy and a homeowner-specific . . . → Read More: Combining Insurance Polices – What to Expect]]> You are likely hearing the adds on t.v. by a few insurance companies talking about putting all of your insurance with them: homeowner, auto, etc.  If you are not familiar with this method, you might want to check into it.

The word “combining” may be a little misleading.  You still have an auto-specific policy and a homeowner-specific just as you have now. What is different is that both policies are written by the same company and, though you will have two different policy numbers, you typically will also have an account number that will include all the policies in your name with that company and that account number will be the prevalent identification for you with the company, rather than your policy specific numbers. The reason people “combine” all their policies under one insurance company roof is that, historically, they get better rates.

“Better rates” means a discount, of sorts, charging a lower premium for each policy than if they were stand-alones . How much of a saving will vary and you will have to compare. Better rates are not just the only benefit for having all your policies with the same company. It is sort of like centralizing your insurance – one stop shop, one agent or sales customer service to deal with. It is also possible to obtain an umbrella policy – if your company offers this coverage.  If you are not familiar with the umbrella policy, it is a liability coverage that, as its name suggests, covers the underlying policies (homeowner and auto)  for the higher amount – payable after the exposed underlying policy’s (i.e., homeowner or auto) liability coverage is exhausted and there is still exposure.  Umbrella policies, typically, are for a million dollars (and more) and are a good idea if you have a lot of assets to protect. Be mindful that not all companies offer the umbrella so it will be part of your decision making.

If you opt to move your homeowner to the auto company or vise versa – or, go with a whole new company – do not cancel your existing policy/policies that is/are to be replaced until the effective date of the new policy or policies. Very important. You do not want even 1 hour of no coverage. Most cancellations (by you or by the company) take effect one minute after midnight on the date of cancellation. Your new policy typically takes effect one minute after midnight on the date the policy is to go into force. Write to the “old” company and request cancellation on the same date as the effective date of the new one – or the day after, to be sure! If your premium was paid up on the “old” policy and there is still time remaining in the policy period, there may be a pro rata refund coming to you.

As with any insurance purchase, DO YOUR HOMEWORK! List out what you want, what you have, what you are paying now. Find out which companies offer both auto and homeowner, an umbrella if you want it, and then comparison shop – not just for rates but for quality of coverage and quality of company. As with anything, you get what you pay for.

Let’s start with auto. Remember to be the intelligent . . . → Read More: How To File An Insurance Claim – Part II]]> In Part I of “How to File An Insurance Claim”, we addressed the process and your obligations in general terms. The most common insurance claims you will experience – other than health – are for auto and homeowners so we discuss these two in a bit more detail.

Let’s start with auto. Remember to be the intelligent person you are. Unless you were injured to the point of being taken from the scene of the accident, take charge. Observe the other parties involved, get their names if you can but at least be able to describe them. Some police officers who respond to accident will not allow the parties to co-mingle or share information – advising that it will all be on the police report. You can’t change that but be sure you get sufficient information from the officer (his name, his station, etc.) so your claims adjuster doesn’t have to go on an extended fishing expedition to locate a copy of the report. Write down as soon as possible the facts of the accident as best you can recall, including all the details of location, time, precipitating events, etc. Be clear in describing the damage to your vehicle – you don’t have to be an auto body expert to do so. If your car was towed from the scene, know where it was taken. Obviously, provide any and all names and addresses of the people in your car and anything else that may be relevant. If the claim is for vandalism, make a police report. If it is a hit and run while your vehicle was parked, make a police report. If the police refuse to come (many jurisdictions are not responding to minor incidents these days), make a note of the number you called, the time and with whom you spoke. The police department may or may not keep a log of the call but you will have something to show you tried.

A homeowner claim can be for many things from fire, storm damage, break in, vandalism, damage to a neighbor’s property (due to something emanating from your property) to water damage from a broken pipe. Obviously, if the claim is due to a criminal act, you must certainly file a police report. If the loss is from a fire, the fire department will create a fire report so it would behoove you to know the location of the reporting station if you live in a large urban area where there are numerous fire stations.

I noted in Part I to have your insurance policy handy with the Declaration page and any other documents that relate to your coverage for when you speak with your claims person. The insurance company will certainly have all the information on your policy and your coverages but it would be prudent of you to have your own reference documents.

After your claims adjuster takes a formal report, asking pertinent questions that are necessary to initiate the claim, your adjuster will want to take a recorded statement from you – and possibly from other persons relative to the loss. The statement is typically a company requirement and, as the insured, you are obligated to give it. You will be asked the typical personal identifying questions including your social security number. Some people balk at giving their social security number out but it is the one thing that proves you are who you are. If this is a telephone interview, the adjuster can’t view your photo i.d. to verify your identity. I know, it isn’t foolproof these days but it shows appropriate diligence to confirm your identity and, hopefully, prevent fraud. This information is all about identifying you and establishing some level of comfort that the insurance company is, indeed, dealing with whom they think they are.

After these personal questions will come questions about your vehicle, if an auto policy, including any descriptive information to help identify it. Then the damage will be addressed, then other parties associated with the loss, etc. With homeowners, after the personal information, the questions will get more into the facts of the loss and the damage, as well as other parties possibly associated with the loss. Whether auto or home, if there have been prior repairs or work done pertinent to the loss or damage, your claims adjuster will want to know when, what and by whom – supported by receipts/invoices!

All is a fact-finding mission and is as important to you as it is the company. Investigation will determine if the loss is covered (remember there are exclusions, conditions and terms in the policy!). Once coverage is established (an easy task unless there are convoluted circumstances), damages are determined for payment and resolution.

Med Pay will . . . → Read More: Auto Insurance Medical Payments and Personal Injury Protection]]> Medical Payments Coverage (Med Pay) and Personal Injury Protection Coverage (PIP) are first party coverages, applying to the insured, the insured passengers and sometimes others. Med Pay is found in states that do not have No Fault laws in effect and PIP is found in states that do have No Fault laws in effect.

Med Pay will generally pay for reasonable medical and/or funeral expenses as a result of bodily injury  caused by an accident and sustained by the insured vehicle occupant(s) – named insured or family member (per policy definitions), non-family person(s) while occupying the insured vehicle or a pedestrian when struck by the insured vehicle.  There are a number of exclusions to this coverage so be sure to read them!

The limit of liability for Med Pay is as stated in the Declarations. If you have, for instance, $10,000 Med Pay, that is the limit per qualified injured party for the subject incident. Note there is no wage loss allocation in this coverage. Further, there is no “double dipping” permitted. Most companies will demand reimbursement from you (subrogation) for the Med Pay expended on your behalf if you get a settlement from the at fault party’s insurance company that includes your medical bills. Further, Med payments will be deducted if your Uninsured Motorist or Underinsured Motorist coverage comes into play.  Med Pay is designed to allow you to have treatment for your injuries but not to give you a financial windfall.

PIP is the “med pay” in No Fault Law states (remember, “No Fault” does not mean it does not matter who was liable for the accident. Those rules still apply). But PIP is broader than Med Pay in that, besides paying for reasonable medical bills and funeral expenses, it also provides some compensation for wage loss, substitute services and various other. Its purpose is to provide financial remedies to people who are injured in an auto accident (at fault or not at fault) so as not to suffer financial hardship and minimizing the need to sue as their only remedy, should that be the case. PIP coverage varies from state to state in limit requirements and specifics of coverage. The designed purpose of PIP is to provide the benefits necessary to keep the non-fault injured party “whole” and hopefully minimize litigation. Is it successful? Not sure. The injured party can usually still present a Bodily Injury claim or sue the at fault driver but there are various thresholds that have to be met and only parts of the claim can be subject to the claim/suit. Also, reimbursement of med bills paid on behalf of the non-fault injured party are paid directly by the at-fault company to the non-fault company by law. I believe this reimbursement is made whether a bodily injury claim is presented or not.

Substitute Services provides payment for things the injured party cannot do while injured – like mow the lawn. The injured person could hire someone to mow his lawn and submit the chit for reimbursement. PIP may also reimburse mileage to and from the doctor. Wage loss is per a schedule and won’t be 100% unless, perhaps, the person’s salary is below the designated allowance. With both Med Pay and PIP, pedestrians struck by the insured vehicle may be entitled to the benefits under these coverages.

Like Med Pay, the insured can buy greater PIP limits but usually the higher limits will only apply to those qualifying as named insured and family (per definitions).  Others in the insured vehicle may only be entitled to the minimum limits per the state regulations. An important thing to know is that Med Pay typically is an optional coverage but PIP  is mandatory in No Fault states.

Be mindful that whether Med Pay or PIP, these coverages are subject to all the definitions, terms, conditions and exclusions of the subject policy and, as the insured, it is your duty to read your policy and be familiar with all of it. If you are not clear, ask your agent or call your company representative.

What is Uninsured Motorist coverage? Well, it tends to be self-explanatory to some degree. Very . . . → Read More: Auto Insurance – Uninsured and Underinsured Motorist Coverage]]> Uninsured Motorist coverage may or may not be an optional coverage in your state. If it is optional, your state insurance regulations may require that you sign an affidavit for your company rejecting the coverage that is kept in your policy file.

What is Uninsured Motorist coverage? Well, it tends to be self-explanatory to some degree. Very simply, if the at-fault driver is uninsured and causes injury and damage to you, your Uninsured Motorist coverage – known as UM – will take the place of the at-fault driver’s financial responsibility and pay your claim. Again, that’s the simple definition.  There is much, much more to the rules, conditions and exclusions of the coverage.

Uninsured Motorist coverage affects two categories – one is Bodily Injury (UMBI) and the other is Property Damage (UMPD). Let’s discuss UMBI first. Your policy limits for UMBI will be the applicable limits for you and those family members considered first party insureds per your policy definitions. The applicable limits for others in your vehicle who sustain injury in this situation would be the state’s minimum required limits for BI. So, if your state that had minimum limits of 15/30 for Bodily Injury but you had UMBI limits on your policy of 30/60, these higher limits would only apply to first party insureds (read your policy definitions!) and all others in your vehicle who sustained injury in an accident caused by an uninsured motorist would only have  available the 15/30 limits – regardless of the severity of their injuries.  Make sense?

UMPD is for the damage to your vehicle caused by the uninsured motorist. This is a separate coverage so don’t think that if you opted for the UMBI that you get both. Typically, if you have Collision coverage, you cannot have UMPD but may opt for Collision Deductible Waiver, which will pay your Collision deductible when in an accident with an identified uninsured motorist. Same outcome, basically. People who don’t have Collision will usually take the UMPD, which may carry a stated amount as maximum that will be paid out under the coverage.

“Identifiable” brings up some important points – requirements for UMPD to be used:

1)    Your vehicle must have direct contact with the uninsured vehicle

2)    The owner or the operator of the uninsured vehicle must be identified, or

3)    The other vehicle must be indentified by its license plate number

Now that you have some understanding of what UM is, there is also UIM – which is Underinsured Motorist coverage. This is part of your UM and only applies to the bodily injury part of the coverage. If you are severely injured and the at-fault party only has, say 15/30 Bodily Injury coverage (for which you are only entitled to $15,000), and your UMBI coverage is 50/100, there is an additional $35,000 available to you to satisfy your claim (the underlying $15,000 is subtracted).

UM Coverage is simple on the one hand but complicated in that there are many definitions, conditions, and exclusions that apply. The coverage is designed to prevent the non-fault parties from being financially “screwed” when hit by an uninsured party but has safeguards to prevent abuse.

Insurance companies tend to call this coverage “Other Than Collision” anymore because it better describes what it does. Your more common types of . . . → Read More: Auto Insurance – Comprehensive, aka Other Than Collision]]> Comprehensive coverage, more commonly known these days as “Other Than Collision”, is a first party coverage (for your vehicle) that many people don’t think about very much until they have a need for it.

Insurance companies tend to call this coverage “Other Than Collision” anymore because it better describes what it does. Your more common types of losses that would fall under this coverage are losses like vehicle fires, vandalism and theft (partial or total). Be mindful in regard to vehicle fires that the cause of the fire may not be covered (faulty line or some mechanical problem) but the resulting damage likely will be covered.  For instance, if your heating system or a/c system was faulty and caught fire, those items would probably not be covered in the claim – only the damage the fire caused to the rest of the vehicle.

We all know about vandalism…someone keys or spray paints your vehicle, breaks your windows, throws heavy objects that cause dents.  Of course, let’s not forget the attempted (or actual!) theft of things inside your vehicle where the key lock is damaged in the process.  The list goes on but you get the idea.

We mentioned theft, partial and total. Partial theft would obviously be things like the installed stereo, the hubcaps, the wheels, vehicle striped (!), etc. Make note here that personal items in your vehicle that may be stolen from your vehicle are not covered under your Auto policy. Brief cases, computers, cameras, tools – whatever is not an attached part of the vehicle – will have to be claimed under your Homeowner’s or Renter’s Policy. Total theft is just that, the vehicle is stolen – lock, stock and barrel!  It may be recovered with no damage, minor damage, lots of damage, is a total loss or not recovered at all.

Any of these types of losses are appraised for value to repair/replace in order to restore your vehicle to its like-kind pre-loss condition. This would mean finding parts for that year vehicle, etc.  Sometimes there are items that would have to be purchased new but depreciation would be applied. If your vehicle is 4 years old and your installed stereo is stolen, the company may have to purchase a new one but they will use a fixed formula to depreciate the new one’s price to account for the 4 years of use. Tires are replaced this way, as well. Depreciation may seem hard to swallow when you are dealing with the loss but it is appropriate. The job of your insurance coverage is to make you whole again, not better your situation. A lot of people don’t understand that. And, having already suffered the irritation and inconvenience of the loss, they may now have to pay out of pocket to get back to where they were before the loss. I’ve been there. Not fun. But it is standard operating procedure. The alternative is to have to pay 100% of the loss yourself – or be without.