Today the Internet has become an important tool when doing any research about products or services. This includes auto insurance. The auto insurance industry has adapted to take advantage of the communication and Internet revolution. In the past obtaining rates from carriers required both time to do it and money to facilitate your efforts in dong the research, i.e. pay phone bills, transport costs.
Once you got the primary data you then needed to analyze the information. Putting insurance quotes and policies side by side to see their differences required a lot of patience and a high level of attention to details. Due to the monotony and tedious nature of the task many people forfeited altogether doing any research on these insurance products. Towards the end of the 90s, insurance companies saw the potential and benefits involved in making use of the Internet to conduct insurance research online.
Auto insurers discovered that they could make the auto insurance process more effective and efficient online for the consumer. Some of the benefits of going online include: Online rate comparisons make it easier and faster for people to compare the insurance products of many companies as opposed to individual inquiries for quotes. Going online also helps the market have the ability to analyze and research several factors individually, feedback history and more.
Another benefit of the auto insurance industry adapting to this technology is that it has made the insurance cover cheaper; the facility to buy a policy without using the services of a broker has eliminated some costs that you would have otherwise incurred.
Here's a tip...Most people know that the Best Way To Get Cheap Car Insurance is to compare insurance rate quotes.
When you're looking for a quote on auto insurance, there are a few questions you need the answers to before you make your final choice. You don't want to take whatever insurance is the cheapest, you want to be an informed driver. You'll want to know what the minimum coverage laws are for where you live. It's your responsibility to make sure you're protected. The insurance company will only offer you quotes based on what you've told them.
You'll want to ask if you can get immediate coverage. If you need insurance fast, you aren't going to want to choose a company that can't guarantee coverage right away. Fortunately, most companies can give you a policy-some within minutes of you filling out an application or form. If you're looking to insure a motorcycle, you'll want to ask up front if they cover motorcycles since a few companies choose not to. They consider motorcycles to be a higher risk because of possible serious injuries in the event of a collision.
Ask the representative if you can get a better payment if you go with a higher deductible. If you're a fairly safe, defensive driver, there's nothing wrong with having a higher deductible but if you or someone who drivers your car is accident prone, this won't be the best choice for you. That's why you'll want to know if the policy has provisions to cover your teenage children if you let them drive your vehicle. Some policies have this blanket coverage while others do not.
Know if the auto insurance company you're looking at for a quote offers any bundle servicing. Find out if they'll give you a discount if you also put your home insurance needs with the company as well. Make sure you specifically ask about discounts as some insurance companies will not automatically offer them.
Ask what type of payment options they have. One of the most convenient ways to pay bills today is either as an automatic withdrawal through a bank account and if you don't have a bank account, you'll want to be able to pay it online for convenience sake.
You'll want to have the above questions answered but you'll also want to make sure that you fully comprehend what it is your state requires (the minimum) versus what will happen to your financial security if you have an accident and the costs exceed the minimum. For example, in the state of California, motorists are required to carry 15/30/5. That's $15,000 for injury or death, $30,000 when it involves more than one person and $5,000 is for property damage. That's just the minimum. You can run into serious financial trouble if you have an accident and there's a greater injury or property damage cost.
When you get auto insurance, keep in mind that it's for your protection and if you can afford a policy with more than the minimum requirements, you might be better off to go with that one. It's always better to be prepared.
Agents: The good, the bad and the ugly
We spoke with Charles Surrano, an Arizona attorney and member of the Advocate Law Group network who has been working in the insurance industry for 30 years. According to Surrano, choosing the right agent can make all the difference. “When it comes to agents, one can expect the good, the bad and the ugly. There are agents who are very professional and very honest who will be forthright with the insured, will explain the policy terms, will quite clearly go through the policy and answer questions the insured might have about the policy and its coverages and benefits. Just as importantly, they will review the limitations under the policy, make sure that the insured has a firm understanding of exactly what it is they’re purchasing and when the policy will pay – and when it might not.”
Unfortunately, there are many agents that don’t always act appropriately. Surrano continued, “On the opposite end of the spectrum, you have the agents who will simply gloss over policies, engage in what you might call the rapid fire sell approach such as, ‘You need this because…,’ and will deflect questions and focus on simply closing the deal. That often leaves policyholders with a substandard understanding of what their rights are and what their coverages would be under the policy.
Those types of agents often create problems for insureds later when they make a claim under their policy because they were either misrepresented on what the policy purported to cover or their understanding in general is simply deficient because of the inadequate way in which the agent explained the terms.”
Shop around for a reputable agent
Shopping around for a reputable agent will give you greater peace of mind. “In shopping for insurance, it’s just as important to make sure you go to an agent that has a good reputation, if you can ascertain that either from talking with people who have purchased insurance or general discourse in the community about what agents or agencies provide better services than others because in the long-run, the agent is the person who puts a face on the insurance company.
Dealing with an honest agent and one who’s forthcoming and knowledgeable will make you feel more comfortable about the insurance product that you’re purchasing – and you’re going to have fewer problems with the insurance company because of it.” Surrano said.
Consumers should hold an insurer, and its agents, to a certain standard. Surrano thinks that good faith and fair dealing are not only standards applicable to insurers, but also encompass how their agents service customers. “Every insurance policy, in addition to the written words, contains an unwritten promise from the insurer to the insured that the insured will be treated fairly and honestly by the insurer,” he explained. “What that duty encompasses, this implied duty, is the obligation of the insurer to investigate claims made by the insured promptly, fairly and honestly.
If your insurance company misrepresents their product, you can sue them. However, if your agent misrepresents the product, can you sue them? Generally, the answer is yes if you relied on information that he or she gave to you that resulted in a lack of coverage or no coverage at all. Unfortunately, proving misrepresentation can become a ‘he said / she said’ exercise in futility. The key is to avoid any type of misrepresentation by doing your homework.
Attorney Charles Surrano, a 30 year insurance practitioner from Arizona and member of the Advocate Law Group network, explains that there are two things insurers can do to protect themselves. “[Number one], make sure you’re dealing with a reputable agent. Number two, during the course of your conversations with the agent, ask questions. Do the thing that most policyholders refuse to do, take some time, review the policy, review the declarations page and ask the agent what the terms mean.
Likewise, if the agent is explaining a promise in the policy of a benefit that’s being provided and that representation is more explicit than what is contained in the policy, see if he will reduce it to writing and tell you what the policy means. At a minimum, make your own memorandum at the time of what the agent told you, so that later on, if you go to present a claim against the insurer, and the insurer says ‘That’s not what that provision provides’, you’ll be able to say, ‘You may be claiming that now, but at the time you sold me the policy, this is how it was represented to me. This is what the agent told me it means.’
Shop around for a reputable agent
Shopping around for a reputable agent will give you greater peace of mind. Surrano explained, “In shopping for insurance, it’s just as important to make sure you go to an agent that has a good reputation. You can ascertain that either from talking with people who have purchased insurance or general discourse in the community about what agents or agencies provide better services than others. In the long-run, the agent is the person who puts a face on the insurance company.
Dealing with an honest agent and one who’s forthcoming and knowledgeable will make you feel more comfortable about the insurance product that you’re purchasing –and you’re going to have fewer problems with the insurance company because of it.”
Auto Insurance companies are always looking for reasons to increase what you pay for auto insurance. If you have an accident. If you have a teen driver. If you file certain types of claim. If you don't have a garage. If you buy a car that happens statistically to be stolen more often. If you change jobs and have a longer commute to work. These are all reasons that an insurance company may decide gives them the right to raise your auto insurance premium. The only way for you to stop them from increasing your rates is to make them compete for your business. As in all negotiations, Information is Power and more importantly, you have to be willing to Walk Away from a bad relationship.
INFORMATION IS POWER - The Internet provides consumers the opportunity to learn about their insurance options. First of all, you can get multiple insurance quotes without having to talk to an insurance agent or sales representative. There are many sites now that allow you to provide driver, vehicle, claims and violations information online in order to show you insurance quotes from multiple companies. You can also visit each company site individually and request a single quote from each. You should be wary of individual companies that promise to give you other company's rates, in insurance, there are people they want to sell policies to and people they don't want to sell policies to, can you really trust them to provide quote information that isn't in their company's best interest. Secondly, just because you shop online with out talking to an agent doesn't mean you have to buy online without talking to an agent. Most online services give you the option of talking to a licensed agent before you buy.
WALKING AWAY - if you aren't willing to end a bad relationship, then the abuse will never end. We need to show insurance companies that they can't just raise rates when ever they feel like it. Insurance companies know that a rate increase will only motivate a small number of their policyholders to look else where. They count on your apathy. Don't let them get away with it. Shop your auto insurance today.
Life insurance: what types are available
Why do we need life insurance? Well, the fact is, we don’t all need it. But if you have a family or people who depend on your income, it is definitely something you should consider buying in order to protect your loved ones. Life insurance can be difficult to grasp due to the different types that are available. This table lists some of the similarities and differences to help you figure out which way to go. Do consult a professional before you make your final choice.
There are three main types of insurance and two variations. The basic policies are term life, whole life and variable life. Variations are universal life and variable universal life.
- Least expensive
- Pays beneficiary lump sum when you die
- Policy limit and death benefit one and the same
- Premium likely to go up periodically
- More expensive than Term
- Offers low-risk cash value account so money is invested to grow over time
- Insurance company manages account
- May not invest or split money into separate accounts
- Premium is fixed, not flexible
- Some policies have option to receive dividends or apply dividends to premium payments
- May withdraw money
- Pays either death benefit or cash value, not both (cash value is the amount available if you surrender a policy early or borrow against it)
- More expensive than Term
- Also invests money into cash account
- Pays death benefit
- Low-risk, tax-free account
- May be riskier than others because allows death benefit to vary in relation to fund returns of cash value account
- May borrow from it during your lifetime
- No guarantees regarding value of cash account
- Premium fixed, not flexible
- More flexible than whole or variable
- Low risk cash value account
- Tax deferred accumulation of funds
- Market rate of interest on cash account
- Borrow or withdraw during lifetime
- Premium flexible
- Face value flexible
- Like whole life, may not invest or split money into separate accounts
- May not move money from one account to another
| Universal Variable|
- Most flexible and expensive
- Low-risk, tax-deferred cash accounts
- You have more control of cash value accounts
- Offers separate investment accounts, like money market, stock, and bond funds
- Requires you to manage your own accounts
- Value rests on your investments
- May withdraw or borrow money during lifetime
Free advice investigates homeowner's insurers of last resort
Home owners in many coastal states have been asking: “Why is my insurance company dropping my homeowner’s policy?” Others are questioning why their rates are rapidly going up or they are being subjected to surcharges.
The answers lie in past losses and fear of future losses by the insurance companies and a related move by states to provide coverage, often at rates that are too low for the risks involved. The result is to drive people increasingly to state operated plans. These state plans operate like insurance companies, but have different objectives. They often do not have adequate reserve funds set aside for unexpectedly high losses, and sometimes have less expertise in setting rates, settling claims and dealing with customers.
Because states require the private companies to contribute to losses by the state plans and because ultimately the taxpayers will be responsible, fears are growing that risk is being shifting from the private insurers to the state plans. This shift makes policyholders, even in areas not affected by the risk, and state taxpayers bear some of the risk of losses. Furthermore, as the concentration of risk in these state plans grows, it poses the possibility of large losses in the wake of future storms – risks that might have been borne largely by private insurance company previously.
The problem has developed as insurers, have been cancelling homeowner’s policies, in areas that might be at risk – primarily shore areas. Increasingly, the companies are worried about the possibility of large losses from hurricanes and other severe storms and concerned that regulators will not allow them to raise rates enough to cover potential losses. While no one can predict how many storms there will be or how much damage they might cause, insurers know that states from Texas along the Gulf of Mexico and up the Atlantic coast to Massachusetts could be subject to crippling financial losses if a major storm such as Andrew or Katrina were to strike an area where they have many policyholders. Katrina payments by insurers have totaled more than $40 billion to 1.7 million U.S. policyholders in 6 states.
In addition, continued development in at risk areas has placed even more properties and higher property values at risk. For example, more than 2,100 new condominium units are scheduled for completion in South Miami Beach by the end of 2009. Other rapidly developing coastal areas include Galveston Island, Texas, Hilton Head and Myrtle Beach, South Carolina, the Maryland shore, eastern Long Island and Cape Cod. As the private insurers retrench to cut their risk, the states have attempted to fill the market need with “insurers of last resort.” In a June 7, 2007 article, The Wall Street Journal reported that such insurers in 16 states have seen a rapid growth in the number of policies and potential liability for damages since 2001. The plans could have serious losses that require bailouts by taxpayers or force policyholders who are not in the affected areas to backstop the losses.
The state plans have tended to change from providers of insurance coverage to those with no other possible carrier to major providers of insurance in high risk coastal areas. This shift of high risk exposure away from private property insurers is placing an enormous financial burden on state-run insurance plans and leaving them operating at substantial deficits while shifting the long-term risk of hurricane related losses to policyholders and taxpayers who do not live near the coast according to Dr. Robert P. Hartwig, president and chief economist of the Insurance Information Institute. Others see it as representing a shift away from the prevailing federal government’s efforts to make individuals assume more risk in areas such as retirement and health care.
Just as investors must be wary of having “all their eggs in one basket” insurance companies that insure too many properties in one geographic area are subject to the danger of concentrated losses. The concern that climate change may exacerbate the severity of the storms only increases the possibility of severe losses in coastal areas. As a result private insurers have moved to limit the number of policies they have in threatened areas and “insurers of last resort” have picked up the business of many of those they dropped. More than 30 “insurers of last resort” are operating in the United States. Some cover other risks such as earthquakes or wildfires and some provide insurance in inner cities where poverty and high crime rates mean that private insurance is not available.
States need to assure that coverage is available in order to continue economic growth in their territory, hence the need for “insurers of last resort.” In addition, there is often political pressure to keep rates for the plans lower than actuarial realities might call for. In some areas, the state plans have been directly competing with private plans and exacerbating the shift away from private insurance. The rapid growth of the plans since 2001 means that potential liability for claims has tripled to over $650 billion.
Florida is the state most vulnerable to coastal storms. It has 27% of all hurricane exposed property in the U.S. and is expected to gain almost 13 million new residents by 2030 according to the U.S. Census Bureau. Coastal exposure in Florida is estimated at more than $2 trillion. New York (primarily Long Island) has almost as much exposure, but the probability of a major hurricane hitting its properties is lower.
In addition to these state plans, the Federal Flood insurance plans liability has grown by two-thirds since 2001 to over $1 trillion.
A prime example of the problems:
Florida operates one of the largest of these coastal “insurers of last resort.” Its problems illustrate the problems faced by such organizations. Citizens Property Insurance Corp. started in 2002 with the idea that it would cover only those who could not find coverage elsewhere and would ultimately shrink and perhaps disappear as the need for it declined. But as market realities and nature intervened to require higher premiums private companies dropped policies or moved out of state. State politicians have reacted by allowing Floridians to opt for coverage by Citizens if private coverage would be significantly higher than what Citizens would charge and offering guarantees of rate stability for several years.
As Citizens is currently the largest homeowner’s insurer in Florida, critics say a major hurricane could cost other Florida policy holders and ultimately Florida taxpayers. Floridians are already paying surcharges on their property insurance bills to pay off deficits from 2004 ($516 million) and 2005 ($1.7 billion). If Citizens charges rates that are insufficient to cover future claims because of political considerations or misjudgments of future losses, there could be large future deficits to cover.
Critics fear that Citizens will get the highest risk customers at unrealistically low rates, thus competing with private companies that might want to insure Florida homes and moving the storm risk to the state plan and away from private carriers. Problems with service to customers and administrative problems have also elicited many criticisms about the organization’s capabilities.
In califonia, companies that provide medical insurance must review the application of an insured at the time the policy is written. Insurance companies may not wait until the insured submits a big claim and then review the application for an excuse to cancel the policy. This illegal practice is called post-claims underwriting and is considered a violation of the insurance companies’ duty of good faith to the policyholder.
People who have their insurance policies cancelled after filing a large claim can bring a legal action against the insurer for bad faith.When the company issues a medical insurance policy, the person insured thinks he or she has medical coverage and relies on it. If the company has a legitimate reason for denying coverage and tells the person at the time of the insurance application, the person can find other coverage. If the insurance company doesn’t review applications until claims are filed and then retroactively cancels the policies, the people insured by the company find themselves without insurance and liable for all the medical expenses that they thought were covered by their medical insurance. This is a very serious injury caused by the insurance company’s bad faith failure to review the application in a timely manner.
A friend of mine got a letter in the mail in 2006 telling her she owed money for a department store bill that had gone unpaid for several months. For our purposes, we’ll say her name is Kathleen Robinson. The letter came addressed to Katherine Robinson; but when she inquired and told them the first name is different, they read her the credit card number. Yup, same number. She informed them that they weren’t her charges and the store did not pursue it. Weeks later she received a phone call from a collection agency. Apparently, someone owed money on a gas credit card that had been taken out in her name. She didn’t have a gas card. Subsequently, the garbage company threatened to stop collecting her trash. It had become apparent to her that someone had stolen her identity. How does this happen and what can you do about it?
How it Happens
Identity theft occurs when someone gets your name, address, credit card number (with or without the card itself), possibly your social security number or other personal information, and uses them to open accounts, charge merchandise, and run up big bills by pretending they are you. They don’t pay the bills, leaving you with collection agencies calling and your credit in ruins. It’s a nightmare and very difficult to correct and reverse the damage.
It’s quite easy how it happens actually, and a wonder that it doesn’t happen even more frequently. Think about the information you give out to people every day. Have you ever given your credit card to someone and shown your driver’s license with your address on it for identification? Of course; we all do it. At a minimum, we share this information at stores and restaurants all the time. Any one of those sales people or store clerks or waiters or cashiers could pocket your number for their own purposes and use it to charge merchandise, apply for other credit, and simply pass themselves off as you. Even when you pay your rent by check and put your driver’s license number on it, your landlord could use (or sell) that information.
This article is not to make you paranoid and believe everyone is out to steal your identity for financial gain, but it is to make you aware that this does happen and how you can protect yourself. (Also see “What Is Identity Theft and How Does It Happen?”.)
How You Can Protect Yourself
You can’t protect yourself completely, but there are some things you can do to reduce the likelihood that someone will steal your identity. If it does happen, a little planning in advance will help you cover your losses.
Tips to protect yourself:
You would be wise to only carry the information with you that you absolutely need for day-to-day dealings. For example, don't carry that platinum credit card with $50,000 limits to the supermarket.
Try to collect your mail as soon as the mailman drops it off, or get a mailbox with a lock. One of the easiest ways for a thief to get your personal information is by stealing your mail. If you don’t receive your credit card bill on time, call the company and find out why. It may have been stolen out of your mailbox and by the time you find out, some hefty charges may have been made.
Shred documents that you no longer need to keep. Don’t simply put old credit card statements into the trash or recycling bin. Thieves will go through garbage to get your personal data.
Ask why someone needs your personal information before you give it to them. Don’t just give it automatically. Never give an individual or a company your personal information if they just call you or email you out of the blue, even charitable organizations. Have them send you their request in the mail.
Don’t fall for online scams. Take to heart the old adage--if it sounds too good to be true, it probably is. If there’s no way to contact the company offline to see if they are legitimate, forget it. Don’t give them any information about yourself.
If you store personal information on your computer, keep it safe. Use a personal firewall and current anti-virus software.
Don’t post personal information online in any chat rooms, bulletin boards, on instant messaging, or on your Facebook or My Space pages. You never know who may be reading it.
Use good passwords on your computer. Give up on the obvious family birthdays and pet and children’s names. Make them lengthy and combine letters and numbers; then rotate your passwords regularly.
Place a fraud alert on your credit reports. It’s a good idea to contact these three credit bureaus: Equifax (800-525-6285, www.equifax.com); Experian (888) 397-3742, www.experian.com); TransUnion (800) 680-7289, www.transunion.com). From each credit bureau, get a copy of your report. Victims of fraud can usually get their report for free. Request in writing that no new credit is granted without your approval. Also in writing, ask that your account be flagged with a fraud alert tag and a victim’s statement, which you should provide. Keep a copy for yourself. When you get your reports, go over them thoroughly and check for any inquiries you didn’t initiate, accounts you didn’t open, and any unexplained debt.
Contact the proper authorities. You can report the theft by calling the Federal Trade Commission’s (FTC) toll-free Identity Theft Hotline at (877) ID-THEFT or (877) 438-4338. Counselors there can advise you on how to deal with the credit-related problems that can result from identity theft. File a report with your local police department, as well.
Buy identity theft insurance—plan for the possibility
Many insurance companies sell identity theft insurance these days to provide reimbursement to victims for the cost of repairing credit reports and restoring one’s identity. Some insurers include it under homeowners’ insurance, and others sell it as either a separate, stand-alone policy or as an endorsement to a homeowners’ or renters’ insurance policy.
These policies are not inexpensive. They average about $25 to $50 for up to $25,000 worth of coverage. They provide compensation for phone bills (for all the phone calls you will have to make), lost wages, (for all the time you will have to spend), notary and certified mailing costs, (for all the letters you will have to mail) and sometimes even attorney’s fees should you require legal assistance.
Which insurance companies sell identity theft insurance?
BESIDES AND BELOW are the companies that currently offer BEST insurance. Not every company sells this insurance in every state. Where we have a review of the company on this site, click on the link next to the insurance company name. They are all in the section called Insurance Company Reviews. Each review will tell you in which states that company does business, the company rating from A.M. Best and a company overview.