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If you don't see an answer to your question, contact your local agent for help. Our experienced agents will be happy to provide you with any information you need to help you make an informed decision regarding insurance.
General Insurance Questions
What information will I need when I’m applying for an insurance policy? Why do insurers need so many details?
You insurance agent will start by asking for some basic information about you, such as your name, age, gender, address, etc. You will also be asked a series of other questions which will be used to determine how likely you are to make a claim.
For example, when you're applying for auto insurance, your agent will want to know about your previous driving record, whether you have any recent accidents or tickets, and what type of car you will need insured. This information is used by the insurer to determine a fair price for a policy. Adults with clean driving records will typically pay less for car insurance than young drivers with lots of traffic tickets.
What are the advantages of using an independent agent to purchase insurance?
An independent agent can offer you personalized service, which can be extremely helpful when purchasing insurance and absolutely necessary when filing a claim. They can also provide more options than a captive agent because they represent several insurance carriers. An independent agent will help you compared several policies to find the best coverage for you.
Car Insurance Questions
I have an old car. Do I really need to purchase car insurance?
Most states require drivers to have at least some car liability insurance. These laws were enacted to ensure that victims of car accidents receive compensation when their losses are caused by the actions of a negligent individual.
Often times the cost of repairing damages to an older car is greater than its value. In these cases, your insurer will usually “total” the car and give you a check for the car’s market value less than the deductible. Many people with older cars decide not to purchase any physical damage coverage.
What is the difference between collision insurance and comprehensive insurance?
Collision insurance covers damages to your car when your vehicle collides with another car or object. For example, if you hit a car in a parking lot, the damages to your car will be paid under your collision coverage.
Comprehensive insurance provides coverage for direct physical damage losses to your car other than collision, including theft. For example, damage to your car from a hailstorm will be covered under your comprehensive coverage.
What factors can affect the cost of my car insurance?
A number of factors can affect the cost of your car insurance -- some of which you can control and some that are beyond your control.
The type of car you drive, how you use it, your driving record, and where the car is parked can all affect how much your car insurance will cost.
Even your marital status can affect your cost of insurance. Statistics show that married couples tend to have fewer and less costly accidents than those who are single.
Homeowners Insurance Questions
How can I lower the cost of my home insurance?
The first thing you should do to lower your home insurance premiums is to request a comprehensive review of your policy and your needs from your independent agent.
It’s not unusual to find quotes on homeowners insurance that vary by hundreds of dollars for the same coverage on the same home. When you shop, be careful to make sure each insurer is offering the same coverage.
Another way to lower the cost of your home insurance is to look for any discounts. For example, many insurers will offer a multipolicy discount when you insure your car and home with them. Some insurers will offer a discount if you have deadbolt exterior locks on all your doors or if your home has a security system.
Another easy way to lower the cost of your homeowners insurance is to raise your deductible. Increasing your deductible from $250 to $500 will lower your premium, sometimes by as much as five or ten percent.
What does homeowners insurance cover?
A typical homeowners policy is comprised of two main sections: Section I covers the property of the insured and Section II provides personal liability coverage for the insured. Almost anyone who owns or leases property has a need for this type of insurance. Usually, homeowners insurance is required by the lender to obtain a mortgage.
What is the difference between “actual cash value” and “replacement cost”?
Covered losses under a homeowners policy can be paid on either an actual cash value basis or on a replacement cost basis. When “actual cash value” is used, the policy owner is entitled to the depreciated value of the damaged property.
Under the “replacement cost” coverage, the policy owner is reimbursed on an amount necessary to replace the article with one of similar type and quality at current prices.
What factors should I consider when purchasing homeowners insurance?
Here are some of the main things you should consider when purchasing a homeowners insurance policy:
- The amount and type of insurance you will need. The coverage limit of your house should equal 100% of its replacement cost. If your policy limit is less than 80% of the replacement cost of your home, any payment from your insurance carrier will be less than the full cost to replace your home – you’ll have to pay the rest out of your own pocket. Also, make sure the personal property and personal liability limits are adequate for your needs.
- Whether or not you need any additional endorsements. Do you want earthquake coverage or special protection for your jewelry endorsement? Your agent will help you determine if there are any gaps in your coverage that require an additional endorsement.
Where and when is my personal property covered?
Personal property (except property that is specifically excluded) is covered anywhere in the world. For example, suppose that while traveling, you purchase a dresser and you want to ship it home. Your homeowners policy would provide coverage for the “named perils” while the dresser is in transit – even though the dresser has never been in your home before.
Do I need earthquake coverage? How can I get it?
A standard homeowners insurance policy does not pay for direct damages caused by “earth movement," which includes earthquakes and volcanic activity. This coverage may be available by endorsement for an additional charge.
If you live in an area that is susceptible to earthquakes, you’ll pay more on earthquake coverage than if you live somewhere unlikely to have an earthquake.
Life Insurance Questions
How much life insurance should I purchase?
“Rule of thumb” suggests that a person should purchase an amount of life insurance equal to six to eight times his or her annual earnings. However, many factors should be taken into account when determining the right amount of life insurance for you and your family, including:
- Income sources and amounts other than salary earnings
- Whether or not you are married and how much your spouse earns
- The number of individuals who are financially dependent upon you
- Whether any special life insurance needs exist – (mortgage repayment, education fund, estate planning need, etc.)
Figuring out the appropriate amount of life insurance for you is not as simple as it appears. Your independent agent will help you avoid buying too much or too little, show you appropriate and optional coverages, and recommend a company that will best serve your interests.
Should I buy life insurance for a spouse or children?
In certain circumstances, it is advisable to purchase life insurance for children. However, generally such purchases should not be made in lieu of purchasing appropriate amounts of life insurance on the family breadwinner(s).
It is of utmost importance that the income-earning capacity of the primary breadwinner be fully protected, if possible, through the purchase of the required amount of life insurance. This should be done before purchasing life insurance for children or on a non-wage-earning spouse. Life insurance on a non-wage-earning spouse is often recommended for the purpose of paying for household services lost due to this individual’s death. In a dual-earning household, it is important to protect the income earning capacity of both spouses.
How does mortgage protection term insurance differ from other types of term life insurance?
The face amount under mortgage protection term insurance decreases over time, consistent with the projected annual decreases in the outstanding balance of a mortgage loan.
Mortgage protection policies are generally available to cover a range of mortgage repayment periods. Although the face amount decreases over time, the premium usually remains the same. Furthermore, the premium payment period is often shorter than the maximum period of insurance coverage. For example, a 20-year mortgage protection policy might require you to pay level premiums over the first 17 years.
Can an existing life insurance policy be used for the repayment of an outstanding mortgage loan?
Yes. An existing policy, either term or cash-value life insurance, can be used for many purposes, including paying off an outstanding mortgage loan balance in the event of the insured’s death. Although a lender may offer a mortgage protection term policy to you, the lender rarely requires it.
Credit life insurance is frequently recommended in conjunction with taking out an installment loan when purchasing expensive appliances, a new car, or for debt consolidation.