Browse Month

February 2016

Fundamentals of Personal Auto Insurance

Personal auto insurance helps you drive peacefully and protects you from the financial loss in case of an accident. It is an agreement between the insurance company and the insurer who pays the premium for the future losses as per the policy. Personal auto insurance provides property, medical, and liability insurance.

Property coverage pays for the damage or theft of your car, medical covers the costs of treating injuries. While, liability coverage pays for the bodily injury or property damage. The main purpose of the insurance policy covering loss of an accident whether or not caused by you.

Why Do You Need Personal Auto Insurance?

Issuance of personal auto insurance is mandatory in almost every State. If drivers do not have this type of policy they are liable to pay fines. This policy saves you from getting bankrupt and minimizes the risk of losses.

Fundamental Coverage by Personal Auto Insurance

Personal auto insurance mainly covers six basic coverages areas.

1. Bodily Injury Liability

This type of coverage applies when you or the designated driver injures someone else. It is necessary to have enough liability coverage in this case because the severity of the accident may vary. You should consider more than the minimum requirement for this type of insurance.

2. Property Damage Liability

This liability grants coverage for the damage caused to someone else’s property by you or your designated driver. The property can include cars, lamp posts, fences, buildings, billboards, or any structures your car hits.

3. Personal Injury Protection

This type of coverage aids you with the treatment of injuries to the designated drivers or passengers. It covers the medical costs, lost wages and even funeral costs.

4. Collision

This coverage pays for the damages caused to your car with the collision of another car, or any other object. It could also include any potholes or anything on the road. This type of coverage is usually sold with a deductible under the range of $250 – $1000. The premium depends upon the deductible. The higher the deductible, the lower the premium.

5. Uninsured Coverage

This type of liability coverage will compensate you or your designated driver if they get hit by an uninsured or hit-and-run driver.

6. Comprehensive

This type of coverage reimburses you for losses because of theft, damage or anything that is other than collision with a car or object which may include, fire, earthquake, missiles, hail, flood, or animals on road. This is also sold with a deductible. You can keep your deductible high to lower your premium.

 

How Do I Choose Chauffeur Insurance

To be a good chauffeur you need to present yourself smartly, be courteous, professional and polite. It is also your responsibility to ensure you plan your journeys effectively to make sure you get the clients where they need to be in good time. Working as a chauffeur tends to fall into two categories – working for yourself, building up a client base of private and corporate clients, or driving for a chauffeur company. If you do decide to go it alone, the first thing you’ll need is to buy or lease an appropriate vehicle, but there are some other major considerations too, not least insurance and licensing.

What type of insurance do I need?

To be a professional chauffeur you will need a licence from your local authority and the appropriate vehicle insurance. Chauffeur insurance may also be referred to as executive vehicle insurance or prestige vehicle insurance. It differs from private hire insurance in that as a chauffeur, journeys are pre-booked and cash is not collected from passengers. Also, it is typically large and comfortable prestige cars that are used for chauffeuring, for example Mercedes, BMWs, Rolls-Royce and Bentleys.

Insurance is available at a number of levels – fully comprehensive, third party, fire and theft, and third party only. Which you choose is up to you. But you may also wish to consider extras like public liability insurance, which will give you added cover should anything happen to your passenger or their belongings whilst in your car. Another thing to consider is breakdown cover and courtesy car options to ensure that if the worst does happen, you can get back on the road as soon as possible, meaning you can keep providing a professional service and keep earning.

What about costs?

The cost of your cover will depend on the level you choose and any extras you decide to go with. However, chauffeur insurance is seen as less risky than private or mini-cab hire as chauffeurs don’t carry cash and cars are pre-booked, often by regular clients or just one client. This means that chauffeur insurance tends to be fairly competitive in the field.

It can really help to talk to an experienced insurance professional who can advise on the type of cover that you need and any extras that may be of benefit to you, helping you to make sense of what is required for your particular circumstances.

 

The Advantages As Well As Disadvantages of Going in for Long Term Insurance Cover for Two Wheelers

Risk cover, even for two wheelers is imperative to safeguard the vehicle and its driver from any unfortunate event like accidents and damage.

But before purchasing a policy for your two-wheeler, make sure that you choose one that suits your needs and requirements. Two wheeler policies also come in different flavours. You could get one that includes personal accident insurance, own damage cover or just plain vanilla third party insurance. However, it is completely up to you to choose the particular terms and benefits of the product.

There is no doubt that purchasing an insurance policy for your two-wheeler will help you to recover any financial losses which might arise due to unfortunate events like accidental damage to property, yourself, any third party or the two-wheeler itself. Now you can easily purchase a long term policy and get bike insurance quotes online.

Since getting bike insurance is mandatory, it is a good option to go for a long term policy. The major benefit of such a plan is that you need not go through the hassle of renewing the policy every year. Also, all the major insurers offer large discounts on long term policies. This is because insurers are able to make significant savings on premium cost, administration costs and follow up for premium, which they can afford to pass on to customers. Owners can get even better premium rates when they buy insurance online. This is because companies do not need to pay commission on policies sold online, and they also pass on this benefit to their customers in the form of discounts.

When taking long term cover, owners can purchase a policy for three to four years based on their needs and requirements, where they need to pay a lump sum premium at the beginning of the policy term. This way, two-wheeler owners do not have to go through the hassles of yearly payments and are saved from the tensions and burden of forgetting the renewal dates of the policy.

You can check the coverage of different two wheeler insurance policies and compare them online. Similarly, don’t forget to consider the tenure of your vehicle insurance plan on the web portals. Try to search for a longer tenure. This is because the longer the tenure; the more are the chances of lower premiums. Additionally, there will be no increase in the amount of premiums during the coverage period. There are many discounts and offers available when you buy insurance online which can give you savings as well as convenience.

What is the flip side of opting for long term insurance? In a case where the premium rate becomes lower in future, the owner is bound up in the higher rate. Also, he does not have the option of changing vendors or policy features frequently.

 

Ways To Reduce Auto Insurance Premiums

As a prior insurance agent, I was always quick to look for ways to reduce my client’s costs. As I learned more about my field I uncovered a few surprises that you may not have heard about (and your agent may not even know). I recommend that you do your own research by talking with your carrier’s underwriting agent.

First, one that you likely already know about is the potential savings when bundling with property insurance and multiple vehicles. Not only should you research the multi-vehicle discount, but consider bundling in the home insurance too. Most carriers offer both home and auto insurance and will discount the auto premium a few percentage points if you insure both home and auto with them. However; you should consider a few things when making this decision. (1) Make sure that the discount is really an overall cost savings to you. If you can save more by using different carriers then there is no financial advantage to combining. A 5% savings on your auto policy is not a benefit if the carrier is charging 10% more than the competition. (2) If an auto or home insurance agent or carrier’s reputation is not acceptable in your neighbourhood, then the potential for heartache may not justify the savings.

The second way that you might save is based on the usage if you have multiple vehicles insured. Check with your carrier if one or more vehicles stay at home frequently or are a very short commute to work / school. Several carriers offer a discounted rate for vehicles that are driven fewer than 10K miles each year. This is especially true of “pleasure” vehicles which are not used for daily driving.

Our third potential discount applies to motorcycles. Many years ago my “big name” insurance company quoted me an outlandish rate for just liability coverage when I purchased a used motorcycle. Their premium quote was equal to the value of the motorcycle each year. I was shocked and called the company to explain that I was not seeking full coverage, but only liability coverage for this inexpensive motorcycle. I learned that they had not made an error, but they admitted that they quote extreme premiums because they don’t want to insure motorcycles. I sought another insurance carrier and insured the motorcycle for less than 10% of their quote.

Another consideration is the amount of the deductible. It is true that a higher deductible will save some money, but it is a diminishing return. You should consider this carefully based on what amount you can absorb if you must pay this deductible following an accident. With many carriers there is not much savings when increasing the deductible beyond $500.

Last on our list is a hidden gem. Years ago I lived in Houston, TX. Full Coverage auto insurance in large cities definitely costs hundreds more per year in premiums as compared to what I have paid in a small town or rural community. I was reading my policy and stumbled upon the Medical coverage section under full coverage. This particular section contains a clause to cover your personal medical costs – not that of others. It is important to understand that the section referred to does not provide coverage for damage to other’s property or bodily injury (Liability), but covers your own bodily injury in an accident which as provided by Full Coverage insurance. This personal health insurance is only applicable if no one else is liable. (An example would be if you slid on ice and had an accident as a result.) The issue is that this is secondary insurance and not the primary health insurance. If you already have health insurance through your employer or other means; then the secondary insurance provided by your auto policy is untapped unless your primary insurance runs out of coverage money. Even then you must first be aware of this insurance to order to engage the carrier. Most of us do not even know that this coverage is buried in the auto policy we pay. When I discovered this clause I called my underwriter to clarify. What I learned from the underwriter was that I could waive this coverage and reduce my premium by $80 annually. (By the way… the underwriter admitted that she waived this coverage herself.) This must be a personal decision. I urge you to call your underwriter and thoroughly discuss your options and implications before making your decision. If you do not live in a high premium area then the dollar amount of this savings is not as great… perhaps 5% of the premium.

Finally, do yourself a favor and call your carrier even if you are totally happy with your coverage. You will likely find that they can reduce your cost simply because you asked. This is a competitive market and all the carriers want to keep a good customer. To keep you happy they will likely have some promotion or gimmick to offer you that will save you money. One thing is sure… you won’t get any discounts unless you ask.