Dear Appreciated Friend,
Health insurance, worker’s comp, home, life, and automobile insurance rates have all increased dramatically. High insurance premiums alarm us to the point that we don’t know if we truly want to turn in a claim.
Collision repair shops report that 25% of all their repair jobs are paid out-of pocket versus going through insurance companies. They say that many of their customers are reluctant to report claims for fear that their premiums will increase or that their carrier will drop them.
Many people don’t have the right information about their insurance policies, which can lead them to being underinsured, buying the wrong policy, or paying too much. We at Tony’s Body Shop want to bring you some information about your options as a consumer when purchasing insurance.
What do You Expect From Your Car Insurance?
Many people have misconceptions about what their insurance payments are really for. They feel their benefits should equal the premiums paid and feel cheated if they are not “using” their insurance. They go years without making a claim, but in reality this is exactly what you want to happen. Insurance should be thought of as protection against a real financial catastrophe, not as a buffer against the normal ups and down of day-to-day living.
Let’s look at some common beliefs you may hold about your insurance that may cause you to be underinsured, purchase the wrong policies, or pay too much.
Do You Feel Cheated When You Never Make A Claim Against The Premiums You’ve Paid For?
That’s what the premiums are there for: to protect you in the event of a catastrophe. If your house should burn down, you would want your homeowners insurance to be there to cover the damage. Most people don’t have enough money in savings to pay for the re-building of their home or to pay off the mortgage should a catastrophe occur. Also to be considered is the cost of living elsewhere while your home is under construction. On the other hand, you can probably cover a broken window that the neighbor’s kid broke during a baseball game.
Are You Paying A Higher Insurance Premium Just To Have A Lower Deductible, When In Fact, If You Do Have A Claim Your Premiums Could Possibly Skyrocket ?
In most states your insurance premiums are based on your risk ratings, which your insurer determines according to your driving history over a six-year period. This includes traffic violations and accidents.
Let’s say you have a stellar rating, and a deductible of $250. If you were in a collision that you reported to your insurance company, they might cover the costs of the repairs while at the same time hiking your premiums by $300 to $700 every year for the next three to six years. If your rating is at a high-risk level, they can triple that figure. Is it really to your advantage to report this?
Choosing deductibles of $500 to $1000, instead of $100 or $250, can easily save you as much as 30 to 40 percent of your premiums. In addition, higher deductibles reduce the temptation to make lots of claims. These days that’s a good thing. Ask your insurance company if you want to make changes, but by all means, get a deductible you can afford should the need arise.
In regards to having an auto accident, don’t be afraid to get a price for the repairs, and then ask your insurance company how reporting this claim will affect you. You can then determine what it would cost you for the repair verses a possible higher insurance premium. Lets say you backed into the trashcan and damaged your car, you could figure out which is the least expensive for you: turning in a claim or paying for the repairs yourself. Your insurance agent won’t mind if you ask this question, they are there to help you. On the other hand, if you have an accident and you hit someone and they are injured and you are at fault, then your insurance will have to pay. This is why we have insurance, to cover ourselves in the event of these types of unforeseen problems.
Do You Have The Liability Coverage You Need So That You Won’t Be Wiped Out In The Event Of Harming Someone Else?
Liability insurance pays for the damage you do to others or that they do to you. In some states liability insurance is mandatory.
Let’s say you are responsible for an automobile accident where someone is seriously injured. You could be responsible for that person’s lost income, medical expenses, and care for the rest of his life….and yours. You could be sued and loose almost everything you have spent a lifetime working and saving to accumulate. To protect yourself and your assets, get enough liability insurance to cover your net worth. (Your net worth is everything you own minus everything you owe.)
Earthquake Country -- Potential Disaster?
Over 80% of California homeowners do not have earthquake insurance. Yes, we Californians know that serious earthquakes are rare. The chances of your home being severely damaged appears to be slim. We Californians use this as an excuse for not buying coverage. Some people think that the government will step in and “save the day”, but that doesn’t always happen.
In the 1994 Northridge quake in California, people found that they could not pay their mortgage and pay for a place to live at the same time. Some of the help available through the government was in the form of low interest loans. Remember insurance is meant to help you through the disasters that you could not easily cover on your own. If you live an area where natural disasters are a possibility, you should consider appropriate coverage.
Umbrella Policies - What Are They? Do You Need One?
Auto and homeowners policies have limits on liability coverage. However, you can buy an additional policy known as an umbrella liability policy, which raises your liability coverage to $1 million of coverage for a relatively low cost. Take a minute and calculate your net worth and see if you would benefit from the protection these policies have to offer. In today’s world if you hit a high-end car and the person is injured you can easily reach your standard liability limits.
Are You Asking About Your Discounts?
If you have air bags, automatic seatbelts, low annual mileage, anti-theft devices, are over 65, own a number of cars, and/or use public transportation for your weekly commute, you may be eligible for 5 to 30 percent discounts on your auto insurance. Make sure you ask. Being Prudent can save you money. Watching the speed limit as you drive, maintaining your car and your home in good repair helps reduce claim risks on your coverage.
Paying bills on time is also a good thing to do. Some insurance companies determine their rates based on credit scores. They believe that people who pay their bills on time are also prudent in other aspects of their lives and therefore consider these people as a lower risk and more reliable customers, this might determine how much you pay in the near future.
By All Means, Don’t Be Afraid To Ask.
It is your responsibility to ask your insurer how you can save more, what will and won’t be covered; if you need repairs will they cover new original equipment manufacturer (OEM) parts or aftermarket parts.
If you have an accident will you need a car rental? Many people shop for the cheapest rate and exclude car rental, but once they have to use their insurance for a claim, they are upset at their agent because they don’t have transportation while their car is being repaired. The cost of adding car rental is minimal compared to the inconvenience of not having transportation.
Believing you have “full” coverage may not mean you have every possible insurance option you may need, so ask. Also, when your agent calls you once a year to review your coverage, by all means make the appointment. An insurance agent’s job is to assist you in obtaining adequate protection and save you money where they can.
Thought For The Day
“You can make more friends in two months by becoming interested in other people than you can in two years by trying to get other people interested in you.” –Dale Carnegie
“The game of life is the game of boomerangs. Our thoughts, deeds and words return to us sooner or later, with astounding accuracy.” –Florence Shinn
Why should you refer your family and friends to Tony's Body Shop?
What we offer with every repair job:
- Guaranteed color match
- Accurate panel to panel alignment
- Repairing the vehicle to a safe condition
Your 100% satisfaction is our goal.
At Tony's Body Shop you can still find service, a smile, and a sincere thank you if you allow us to service your auto body needs.
Please feel free to call us if we can be of help or guide you in any way.
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