A variety of factors influence how much you pay for auto insuranceincluding your age, driving record, gender, how many miles you drive, where the car is garaged, and the vehicle's make and model.
Even when all other factors are equal, the price of insurance can vary widely by type of vehicle. Generally, the more expensive a car is, the more costly it is to insure. That's because a high-end luxury sedan will cost a lot more to repair or replace than a modest family car, and insurers are well aware of the difference.
In setting the premium, insurers consult a database that shows the number and type of insurance claims filed for each vehicle make and model. Some vehicles have a heavier claim history than others.
Small cars and car insurance
For instance, smaller cars tend to be associated with more injury and collision claims than larger vehicles because they tend to get into more accidents. That may be due to who drives them--namely young people with limited driving experience.
Small cars as a group also tend to be less safe than large, heavy cars, which are better able to absorb the energy of a crash than smaller cars.
Among the cheapest vehicles to insure are minivans, largely because of the good safety records of their typical drivers--soccer moms. Minivans also are not designed for speed or to whip in and out of traffic, so they don't encourage unsafe driving. The most expensive vehicles to insure are ultra-luxury cars and high-end sports cars.
Get car insurance quotes for various vehicle makes and models you're considering before you make a final decision when shopping for a new or used car.
Source
Friday, August 31, 2012
How do I take a home inventory?
A home inventory may not seem like a high priority on your list of things to keep up with as a homeowner. However, in the event that your home was destroyed in a fire or other peril, this list will be one of your greatest assets.
A home inventory is a detailed list of all of your home contents. In the event that disaster strikes your home, this list will help you remember all of your personal belongings so that you can report your entire loss to your insurance company. Contents coverage (or coverage C) is the portion of a homeowners insurance policy that provides coverage for the items inside of your home.
In the event of a disaster striking your home the loss can be overwhelming and many homeowners can not remember everything that they had in their home before the loss. A home inventory will keep you from forgetting important items and help speed up the claims process.
Also, when taking a home inventory take note of any particularly high-value items such as pieces of jewelry, furs or collectible items. Some of these items have coverage limits associated with them which may leave some of your possessions under insured. Ask your insurance agent if you need an endorsement, or rider, on your policy in order to adequately cover these items.
When taking an inventory of your home, be sure to include everything you own except vehicles, animals and items that are insured under other policies. It is important to keep this document in a safe place outside of your home- such as in a safe deposit box or at a relative's house.
A few helpful reminders for creating your home inventory:
Source
A home inventory is a detailed list of all of your home contents. In the event that disaster strikes your home, this list will help you remember all of your personal belongings so that you can report your entire loss to your insurance company. Contents coverage (or coverage C) is the portion of a homeowners insurance policy that provides coverage for the items inside of your home.
In the event of a disaster striking your home the loss can be overwhelming and many homeowners can not remember everything that they had in their home before the loss. A home inventory will keep you from forgetting important items and help speed up the claims process.
Also, when taking a home inventory take note of any particularly high-value items such as pieces of jewelry, furs or collectible items. Some of these items have coverage limits associated with them which may leave some of your possessions under insured. Ask your insurance agent if you need an endorsement, or rider, on your policy in order to adequately cover these items.
When taking an inventory of your home, be sure to include everything you own except vehicles, animals and items that are insured under other policies. It is important to keep this document in a safe place outside of your home- such as in a safe deposit box or at a relative's house.
A few helpful reminders for creating your home inventory:
- List every item of value in your home
- Include serial numbers of items anywhere you can
- Continuously update your home inventory as you acquire new items
- If you have the receipt- include it!
- Take Photos- take close-up and wide-angle shots, use a color camera or video camera if possible and have a family member in all pictures to help prove ownership.
Source
Why You Should Have Umbrella Liability Insurance
I already have $400,000 in liability coverage on my auto-insurance policy. How do I determine whether I need to add an umbrella liability insurance policy to my coverage? How much would an umbrella policy cost?
Umbrella liability insurance is an inexpensive way to protect you and your property from lawsuits. You don’t need it if you have relatively little at stake, but “if you’ve accumulated some assets and have a home, it makes sense to have the policy,” says Rob Seltzer, a CPA in Los Angeles. He recommends that you add an umbrella policy, which starts at $1 million of coverage, to protect against lawsuits even if your net worth is far less than that. The policies protect future income as well as assets and also cover legal fees.
Insurers generally require that you have at least $300,000 in liability coverage on your home and automobile before you can buy umbrella coverage, which picks up after you’ve exhausted your homeowners and auto liability limits. The first $1 million of coverage generally costs $200 to $400 a year; the next $1 million runs an additional $75 to $100.
Raising your auto and homeowners deductibles from, say, $250 to $1,000 would offset the cost of $1 million in umbrella coverage, says Seltzer. “If you are in a car accident and have to come up with an extra $750 for the deductible, that’s not going to kill you. But if something really bad happens, that $1 million umbrella policy is a savior.”
To buy the coverage, start with your auto- or homeowners-insurance company, which may give you a discount for keeping your business in-house.
Source
Umbrella liability insurance is an inexpensive way to protect you and your property from lawsuits. You don’t need it if you have relatively little at stake, but “if you’ve accumulated some assets and have a home, it makes sense to have the policy,” says Rob Seltzer, a CPA in Los Angeles. He recommends that you add an umbrella policy, which starts at $1 million of coverage, to protect against lawsuits even if your net worth is far less than that. The policies protect future income as well as assets and also cover legal fees.
Insurers generally require that you have at least $300,000 in liability coverage on your home and automobile before you can buy umbrella coverage, which picks up after you’ve exhausted your homeowners and auto liability limits. The first $1 million of coverage generally costs $200 to $400 a year; the next $1 million runs an additional $75 to $100.
Raising your auto and homeowners deductibles from, say, $250 to $1,000 would offset the cost of $1 million in umbrella coverage, says Seltzer. “If you are in a car accident and have to come up with an extra $750 for the deductible, that’s not going to kill you. But if something really bad happens, that $1 million umbrella policy is a savior.”
To buy the coverage, start with your auto- or homeowners-insurance company, which may give you a discount for keeping your business in-house.
Source
Thursday, August 30, 2012
Insurance should deal with risk
Insurance is all about risk. Yet neither insurance companies nor their policyholders can do anything about one of the biggest risks — namely, interference by politicians, to turn insurance into something other than a device to deal with risk.
By passing laws to force insurance companies to cover things that have nothing to do with risk, politicians force up the cost of insurance.
Annual checkups, for example, are known to take place once a year. Foreseeable events are not a risk. Annual checkups are no cheaper when they are covered by an insurance policy. On the contrary, they are one of many things that are more expensive when they are covered by an insurance policy.
All the paperwork, record-keeping and other things that go with having any medical procedure covered by insurance have to be paid for, in addition to the cost of the medical procedure itself.
Politicians love to mandate things that insurance must cover, including in some states treatment for baldness, contraceptives and whatever else politicians can think of. Playing Santa Claus costs a politician nothing, but it can cost the policyholder a bundle — all of which the politician will blame on the “greed” of the insurance company.
Insurance companies are regulated by both states and the federal government. This means that, instead of there being one vast nationwide market, where innumerable insurance companies compete with each other from coast to coast, there are 50 fragmented markets with different rules. That adds to the costs and reduces the competition in a given state.
When there are innumerable insurance companies, it is by no means clear that political regulation of them will produce better results than the regulation provided by competition in the market. In a competitive market, insurance companies would cover only those things that policyholders are willing to pay to have covered. Policyholders would have no reason to pay to have insurance cover things that would be cheaper if paid for directly — or not paid for at all, in the case of things that are not a concern to many people, such as baldness cures.
One of the factors in the number of the “uninsured,” for whom politicians are willing to turn the whole medical-care system upside down, is the high cost of insurance that covers far more things than most people would be willing to pay for, if it was up to them. The uninsured who use hospital emergency rooms and don’t pay are a problem only because politicians passed laws forcing hospitals to let themselves be taken advantage of in this way.
Too many political “solutions” are solutions to problems created by previous political “ solutions” — and will be followed by new problems created by their current “solutions.”
There is no free lunch. In the case of health insurance, there is not even an inexpensive lunch.
Health insurance would be a lot less expensive if it covered only the kinds of risks that can involve heavy costs, such as a major operation or a crippling disability. While such things can be individually very expensive, they don’t happen to everybody, and insurance is one way to spread the risks, so that the protection of a given individual is not prohibitively expensive.
The problem of “pre-existing conditions” is a problem largely because of the way that politicians have written the laws — more specifically, by giving a tax break to employer-provided health insurance. If individuals bought their own health insurance, with the same tax advantages, the fact that an illness occurred after they changed employers would not make it a “pre-existing condition.”
There is no inherent reason for employers to be involved in the first place. The fact that some guy manufactures furniture or plumbing fixtures in no way qualifies him to understand insurance for his employees. Including him in the loop adds another unnecessary layer of bureaucratic costs.
Political risks are the biggest risks.
What The Apollo Astronauts Did For Life Insurance
This week, Americans have been remembering Neil Armstrong. But before he walked on the moon, he had to solve a much more prosaic problem.
"You're about to embark on a mission that's more dangerous than anything any human has ever done before," Robert Pearlman, a space historian and collector with collectspace.com, told me. "And you have a family that you're leaving behind on Earth, and there's a real chance you will not be returning."
Exactly the kind of situation a responsible person plans for by taking out a life insurance policy. Not surprisingly, a life insurance policy for somebody about to get on a rocket to the moon cost a fortune.
But Neil Armstrong had something going for him. He was famous, as was the whole Apollo 11 crew. People really wanted their autographs.
"These astronauts had been signing autographs since the day they were announced as astronauts, and they knew even though eBay didn't exist back then, that there was a market for such things," Pearlman said. "There was demand."
Especially for what were called covers -– envelopes signed by astronauts and postmarked on important dates.
About a month before Apollo 11 was set to launch, the three astronauts entered quarantine. And, during free moments in the following weeks, each of the astronauts signed hundreds of covers.
They gave them to a friend. And on important days — the day of the launch, the day the astronauts landed on the moon — their friend got them to the post office and got them postmarked, and then distributed them to the astronauts' families.
It was life insurance in the form of autographs.
"If they did not return from the moon, their families could sell them — to not just fund their day-to-day lives, but also fund their kids' college education and other life needs," Pearlman said.
The life insurance autographs were not needed. Armstrong and Aldrin walked on the moon and came home safely. They signed probably tens of thousands more autographs for free.
But then, in the 1990s, Robert Pearlman says, the insurance autographs started showing up in space memorabilia auctions. An Apollo 11 insurance autograph can cost as much as $30,000.
Pennsylvania Insurance Department Announces Updated Highmark Filing
The Pennsylvania Insurance Department today announced that UPE/Highmark has filed updated information regarding its proposed change of control and affiliation with West Penn Allegheny Health System.
"The new supplemental filing describes significant developments that have occurred since last November's original filing," said Insurance Commissioner Michael Consedine.
"This includes changes in Highmark's leadership, governance structure, an additional affiliation with another regional medical center, and the UPMC contract extension. The department will continue to analyze this new information and make it available for public review and comment."
Significant developments and changes in the proposed transaction include:
- Integrated delivery network expenditures: In addition to the initially proposed West Penn Allegheny Health System (WPAHS) expenditures, which remain at $475 million, the supplemental filing describes $525 million of additional expenditures related to Highmark's implementation of a broader integrated delivery network, including an affiliation with Jefferson Regional Medical Center (JRMC). The supplemental filing discloses the currently anticipated allocation of expenditures, which totals an estimated $1 billion:
- WPAHS: $475 million
- JRMC: $120 million
- Provider network expansion (physicians, community hospitals and medical malls): $364 million
- Infrastructure development (physician practice management company, group purchasing organization): $41 million
- UPMC contract extension: The original filing anticipated that contracts between Highmark and the University of Pittsburgh Medical Center (UPMC) would be terminated effective June 30, 2012, with a one-year run out period. Those contracts have now been extended and the supplemental filing describes the impact of that extension.
- Proposed affiliation with Jefferson Regional Medical Center: The affiliation between Highmark and JRMC occurred in June 2012 and is described in the supplemental filing.
- Change in UPE/Highmark CEO and description of leadership: The supplemental filing describes the appointment of William R. Winkenwerder Jr., M.D., M.B.A. as President and Chief Executive Officer of UPE and Highmark; and also describes the proposed leadership of the Integrated Delivery Network and WPAHS, if the filing is approved.
- Governance and reserved powers: The supplemental filing provides a revised description of the proposed governance structure and discloses proposed amended and restated Bylaws of Highmark, including powers to be reserved to UPE.
- Other developments: The supplemental filing describes other developments that are relevant to Highmark's proposed change of control.
The updated filing, public comments and related materials are available on the department's website. Visit www.insurance.pa.gov and click on "Highmark/West Penn."
"A full, transparent, and robust public record has been one of our goals with this filing review," Consedine added. "The public comment period will remain open to afford everyone ample opportunity to provide written comments regarding this new information."
In November 2011, a "Form A" was filed by a newly-formed nonprofit corporation, UPE, which sought approval for change of control of Highmark and its insurance subsidiaries.
Written comments on Highmark's filing should be directed to:
Robert Brackbill, Chief, Company Licensing Division
PA Insurance Department
1345 Strawberry Square
Harrisburg PA 17120
Fax: 717-787-8557
rbrackbill@pa.gov
PA Insurance Department
1345 Strawberry Square
Harrisburg PA 17120
Fax: 717-787-8557
rbrackbill@pa.gov
Comments received as part of the public record are available on the department's website. Additionally, all comments received are forwarded to Highmark for appropriate response. Those responses are also made available on the department's website at www.insurance.pa.gov.
Wednesday, August 1, 2012
Tips to Buying Homeowner Insurance
Shopping for homeowner insurance is one of those nagging home buying details that sometimes manages to slip though the cracks. It’s not unusual for insurance agents to receive last-minute frantic phone calls from title and / or escrow companies requesting a home insurance binder. To save yourself trouble, it’s a good idea to start shopping for a homeowner policy as soon as your purchase offer is accepted. Here are a few tips about buying homeowner insurance that are designed to save you time and money:
Determine Insurability
Your insurance agent needs extensive information from you to quote you the best rate for your policy. To determine insurability, an agent will ask:
If the home is located in a rural area without a nearby fire department or there is no fire hydrant on the street, some companies may refuse to insure it. In that case, you may have to inquire at a specialty or surplus-lines company, and this quote will take longer to obtain.
Deductibles
You can save money by having a higher deductible on your policy. Typically, insurance companies will start giving discounts at a $500 deductible and increase the discount as your deductible increases. Most companies offer deductibles up to $10,000. Be careful, however, because many mortgage companies will not allow you to exceed a $1,000 deductible, so check with your lender before opting for a higher deductible.
How Much Insurance Do You Need?
Most agents use a cost estimator to figure cost replacement estimates. This will ensure that your home is insured for the correct amount. Insurance companies do not insure dirt. If you buy a home that includes a large lot, do not be astonished when you receive an insurance policy for a lot less than what you paid for the home. This is because you are buying coverage for the home and not the land.
In the past, replacement coverage was called Guaranteed Replacement Cost. There is no such coverage anymore. Today it is Replacement Cost Coverage, which means each insurance company designates a percentage of additional coverage on top of the insured amount. This is designed to protect the homeowner who has suffered a loss from having to pay additional construction costs to rebuild. It can cost more to build because of inflation or simply because material prices have increased. For example, if the dwelling coverage is insured for $300,000, and the company has 125% replacement cost coverage, the homeowner would receive an additional $75,000.
I recommend 200% replacement cost coverage, which gives homeowners double the coverage.
Policy Options
You have other choices on your home insurance policy that you can tailor. Liability coverage is a part of your homeowner's insurance policy that is often overlooked. This protects the insured against claims arising from bodily injury and property damage to others. For example, if your five-year-old was playing with matches and set your neighbor’s house on fire, your liability coverage would pay for this damage. You might have to move out of the neighborhood, but your insurance policy would pay your neighbor.
It is common to see $300,000 in coverage for liability, but the cost to raise it to $500,000 is about $20 more a year. You can have up to one-million coverage on most policies. Over that, you need an excess liability policy or “umbrella” policy. Umbrella policies give you an additional $1,000,000 liability coverage for a $300 to $500 premium.
Available Discounts
Make sure that you are getting all of the credits for which you are eligible. If you have an alarm system that reports to a central station (a company such as Brinks or ADT), in some cases, you can get up to a 10% discount. If you are over 50 and care to admit it, you may be eligible for a discount. Companies have different names for age preference policies, from senior discount to mature policyholder discount.
The most common discount is the multi-policy discount. This will save you money on your home and auto insurance. By combining the two policies with the same company, you are given a certain percentage discount on both. the percentage discounts vary among companies, so it’s best to shop around.
Review Your Policies
Call your agent and review your homeowner policy at least every three years. Needs change, markets change and coverages change. You should stay up-to-date on your insurance because you never know when you will need to rely on it.
Source
Determine Insurability
Your insurance agent needs extensive information from you to quote you the best rate for your policy. To determine insurability, an agent will ask:
- When was the home built?
- How old is the plumbing and electrical?
- What type of roof?
- What’s the square footage?
- How many claims have been filed over the past 5 years?
- Where is the home located?
If the home is located in a rural area without a nearby fire department or there is no fire hydrant on the street, some companies may refuse to insure it. In that case, you may have to inquire at a specialty or surplus-lines company, and this quote will take longer to obtain.
Deductibles
You can save money by having a higher deductible on your policy. Typically, insurance companies will start giving discounts at a $500 deductible and increase the discount as your deductible increases. Most companies offer deductibles up to $10,000. Be careful, however, because many mortgage companies will not allow you to exceed a $1,000 deductible, so check with your lender before opting for a higher deductible.
How Much Insurance Do You Need?
Most agents use a cost estimator to figure cost replacement estimates. This will ensure that your home is insured for the correct amount. Insurance companies do not insure dirt. If you buy a home that includes a large lot, do not be astonished when you receive an insurance policy for a lot less than what you paid for the home. This is because you are buying coverage for the home and not the land.
In the past, replacement coverage was called Guaranteed Replacement Cost. There is no such coverage anymore. Today it is Replacement Cost Coverage, which means each insurance company designates a percentage of additional coverage on top of the insured amount. This is designed to protect the homeowner who has suffered a loss from having to pay additional construction costs to rebuild. It can cost more to build because of inflation or simply because material prices have increased. For example, if the dwelling coverage is insured for $300,000, and the company has 125% replacement cost coverage, the homeowner would receive an additional $75,000.
I recommend 200% replacement cost coverage, which gives homeowners double the coverage.
Policy Options
You have other choices on your home insurance policy that you can tailor. Liability coverage is a part of your homeowner's insurance policy that is often overlooked. This protects the insured against claims arising from bodily injury and property damage to others. For example, if your five-year-old was playing with matches and set your neighbor’s house on fire, your liability coverage would pay for this damage. You might have to move out of the neighborhood, but your insurance policy would pay your neighbor.
It is common to see $300,000 in coverage for liability, but the cost to raise it to $500,000 is about $20 more a year. You can have up to one-million coverage on most policies. Over that, you need an excess liability policy or “umbrella” policy. Umbrella policies give you an additional $1,000,000 liability coverage for a $300 to $500 premium.
Available Discounts
Make sure that you are getting all of the credits for which you are eligible. If you have an alarm system that reports to a central station (a company such as Brinks or ADT), in some cases, you can get up to a 10% discount. If you are over 50 and care to admit it, you may be eligible for a discount. Companies have different names for age preference policies, from senior discount to mature policyholder discount.
The most common discount is the multi-policy discount. This will save you money on your home and auto insurance. By combining the two policies with the same company, you are given a certain percentage discount on both. the percentage discounts vary among companies, so it’s best to shop around.
Review Your Policies
Call your agent and review your homeowner policy at least every three years. Needs change, markets change and coverages change. You should stay up-to-date on your insurance because you never know when you will need to rely on it.
Source
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