Posts by activeblogs

Risk and Reward: Understand What “Risk” Means to Auto Insurers — and Which Behaviors They Reward

Posted by on Oct 12, 2017 in Personal Insurance | 0 comments

Risk and Reward: Understand What “Risk” Means to Auto Insurers — and Which Behaviors They Reward

Just as there are many types of vehicles on the roadways, there also are a variety of drivers behind wheels. And how insurers perceive drivers plays a major role in determining what those drivers pay for auto insurance. What does an auto insurer consider when determining drivers’ policies and rates? In a nutshell, risk. Insurance carriers put drivers into one of three categories — preferred, standard, or high risk — based on their risk assessments. Preferred-risk drivers get the best rates, high-risk drivers pay the highest rates, and standard-risk drivers fall somewhere in the middle. While definitions for each category and the formulas used to classify drivers vary by state and insurance company, some common factors considered for classification include: Age — The preferred-risk category is generally reserved for drivers older than 25. Drivers ages 16 to 25 are often considered high-risk. Driving record — Preferred-risk drivers have squeaky-clean driving records with no tickets and minimal not-at-fault claims. Standard-risk drivers have only one or two minor traffic violations and no more than one at-fault accident. High-risk drivers include those with major traffic violations or a combination of at-fault accidents and traffic tickets. Prior insurance coverage — Insurance companies care about drivers’ industry histories. Preferred-risk drivers have not only had insurance history for the past six months but their liability limits on prior policies were 100,000/300,000 or higher. This means if a driver causes an accident, liability insurance pays up to $100,000 per person but not more than $300,000 per accident. Standard-risk drivers also have six months of prior coverage but may have minimal liability coverage, which insurance companies view more negatively. Those with no insurance coverage for the six months prior are considered high-risk. Credit score — Many insurance companies evaluate drivers’ credit scores and tie them to their driver risk assessments. Why? Insurers see a correlation between credit scores and the likelihood drivers will file auto insurance claims. Higher credit scores are generally associated with standard- and preferred-risk drivers while poor credit scores can signal “high risk” to insurers. What exactly matters on a driver’s record? Since “good driver” is a very subjective term, insurance companies often use Motor Vehicle Reports (MVRs) to more closely analyze drivers’ histories. MVRs are snapshots of drivers’ traffic violation histories, including traffic citations, accident reports, vehicular crimes, driving under the influence (DUI) convictions, and record of points in states that use points systems. They also include information about drivers’ license statuses, like suspensions and revocations, as well as any special endorsements or restrictions. Generally speaking, insurers look at the most recent five years of activity on MVRs, but this varies by state and insurance company. Also, infractions like DUIs may stay on MVRs longer. It’s a good idea to obtain a copy of your MVR before shopping for insurance. This lets you know what potential carriers will see on your record and gives you a chance to correct any inaccuracies before obtaining insurance quotes. Are there specific things drivers can for better auto insurance rates? There are a few ways drivers can boost their “good driver” images in hopes of lowering their auto insurance rates. For younger drivers, typically those under 21, driver education courses can translate to insurance discounts with many providers. For more experienced drivers, a “defensive driving discount” may be available for successfully completing a defensive driving course that often covers traffic laws, driving in adverse weather, drug and alcohol awareness, and specific defensive-driving techniques. Discounts vary by state and insurance company. And in some cases, just being a consistently good driver over time without accidents or violations can garner a “safe driver discount”...

Read More

Don’t Be an Alarming Statistic: Keep Smoke and CO2 Detectors Functioning to Save Lives, Property and Money

Posted by on Sep 28, 2017 in Life Insurance | 0 comments

Don’t Be an Alarming Statistic: Keep Smoke and CO2 Detectors Functioning to Save Lives, Property and Money

Smoke alarms and carbon monoxide detectors are rarely top of mind in our daily routines. But not having these devices — or having ones that don’t work or are out of batteries — can have life-altering consequences. Consider the following: There was an average of 358,300 U.S. residential fires each year between 2010 and 2014. Three out of every five residential fire casualties from 2009 to 2013 were caused by “fires in homes with no smoke alarms (38%) or no working smoke alarms (21%).” When smoke alarms were installed but failed to go off in the event of these fires, 46% of smoke alarms had batteries disconnected or missing while “dead batteries caused one-quarter (24%) of the smoke-alarm failures.” Each year, more than 10,000 people in the U.S. require medical attention for carbon monoxide poisoning and more than 500 people die from it. The statistics are shocking, especially when considering such catastrophes are often preventable. Having the right types of disaster mitigation devices in your home makes sense on many levels: It can save lives, prevent massive property damage or loss, and even reduce homeowner’s insurance rates. According to the Insurance Information Institute, homeowners can typically save at least 5% for having operational smoke detectors installed. Savings can go up to 15 or even 20% for those whose homes have more sophisticated sprinkler systems and fire alarms that automatically notify fire departments. These upgraded systems are costlier and not every type qualifies for the insurance cost reduction, so before making the investment, discuss your options with an experienced insurance agent who understands the link between mitigation devices and policy discounts. Even if you don’t upgrade your system, it’s vital to maintain operational detectors. In most cases, it’s even the law. As of January 2017, 38 U.S. states have enacted legislation pertaining to carbon monoxide detectors in homes, according to the NCSL article, and smoke detector laws are also enforced on a state or local level. There are many combination alarms available that detect both smoke and carbon monoxide, so it’s relatively easy to meet all requirements with one unit in each recommended or required living area. What can homeowners do to ensure detectors function optimally? Test the batteries in each detector monthly. Change the batteries in each detector every six months — even if a test says the batteries are still good. Mark a reminder in your calendar or make a point to change the batteries when you change your clocks for daylight savings time. When changing batteries, also clean each unit. Use a vacuum attachment to remove dust, and follow manufacturers’ cleaning instructions. Replace entire units every 10 years. Mark each unit with the install month and year so you know when the unit’s 10-year lifespan is up. Understand your homeowners insurance policy Such proactive diligence should also be applied to knowing and understanding your homeowners insurance policy and what is covered if you do sustain a house fire. The amount and type of coverage may depend on your situation, which is important to consider as you shop for the right policy. Be sure you understand what is covered, as policies can vary greatly. If you can’t live in the home after the fire, does your policy cover “loss of use” and pay for your hotel and meals while displaced? If your home needs to be completely rebuilt, will your policy cover the full replacement cost? Are all your personal belongings covered or do you need additional coverage to protect costly items like jewelry? If available in your state, fire dwelling insurance may be a better option if...

Read More

Weeding Through the Facts: Life Insurance Options Vary for Marijuana Users

Posted by on Sep 6, 2017 in Life Insurance | 0 comments

Weeding Through the Facts: Life Insurance Options Vary for Marijuana Users

Those in America’s cannabis community may face some tricky terrain when seeking life insurance policies that acknowledge their habit without gouging their wallets. There are no black-and-white answers when it comes to this issue, and different companies have varying viewpoints relating to cannabis-consuming applicants. Frequency of use, type of use — medicinal or recreational — and even honesty regarding marijuana use can affect coverage approval and pricing. Is a drug test mandatory for applicants? Marijuana users hoping to skip the pre-approval exam and related drug screening may find dismal coverage options. “No-exam” policies do exist but typically have much higher premiums and lower death benefits — $50,000 at most for those 40 and older. Standard policies offer the best premiums compared to higher-value policies but require pre-approval exams that consider applicants’ comprehensive health profiles. They can include blood and urine analysis, which often test for tetrahydrocannabinol (THC), the psychoactive ingredient in cannabis. Depending on the type of test and one’s frequency of marijuana use, THC can remain detectable for a month after use. Why do insurers care about THC? THC causes the euphoric “high” feeling associated with cannabis. It can cause impairment to short-term memory, reaction time, motor skills, and attention. Some argue that consuming edible marijuana — usually in the form of a candy or food product — has greater short-term risks because the “high” is delayed one to two hours versus a five- to 10-minute delay when smoked. This can trigger overconsumption among those who think “it didn’t work” and continue to consume more in a short period of time; thus, potentially causing anxiety, oversedation, or psychosis. Marijuana’s long-term effects are less understood and highly debated. Opponents link the carcinogens in cannabis to those of cigarettes and claim long-term heavy smoking can cause dependency as well as cancer of the mouth, throat, and lungs. Proponents argue that recreational marijuana is less addictive and safer than alcohol and cigarettes and medicinal — used as a highly effective natural treatment for dozens of common diseases and disorders. So where does marijuana fit on a carrier’s risk-factor spectrum? According to a June 2016 PBS report, 80% of 148 underwriters surveyed said marijuana use indeed affects their decisions on whether to offer life insurance coverage and how to price it. But 29% of those respondents also classified marijuana users as nonsmokers if those users did not also smoke tobacco. This is hugely important because smokers’ life insurance premiums can be twice as high as those of nonsmokers. Some companies automatically put recreational marijuana use in the same category as smoking cigarettes, meaning they may either charge smokers rates or deny coverage. Others determine coverage and rates based on frequency of cannabis use. What is considered “frequent” to an underwriter is extremely subjective, and some define frequent as more than twice a month while others define it as more than twice a week. But what about medicinal marijuana? Having a valid prescription may help bolster one’s case for better coverage and rates, but the medical condition that warrants the marijuana use may be the real risk factor in insurers’ eyes. For example, insurers can deny someone who smokes cannabis to ward off the ill-effects of cancer treatments coverage or deal high premiums because of the cancer — not the marijuana use. Tips for cannabis-consuming insurance shoppers Life insurance applicants who use marijuana should be transparent about their use and frequency of use. Those who lie or misrepresent their marijuana usage can not only be denied coverage by that insurance company but can also be reported to the Medical Information Bureau, which places...

Read More

Auto Insurance Coverage: Unforeseen Speed Bump for Some Rideshare Drivers

Posted by on Aug 28, 2017 in Business Insurance | 0 comments

Auto Insurance Coverage: Unforeseen Speed Bump for Some Rideshare Drivers

The concept of ridesharing has become so popular it’s turned one brand into a common verb, “I’ll just Uber.” And we no longer get a lift but, rather, a Lyft. Rideshare requirements Such popularity among ride hailers has meant a surge in drivers looking to make or supplement their incomes as rideshare drivers. The requirements to sign on as an Uber or Lyft driver are straightforward enough: To qualify, a driver must be 21 or older, own a smartphone, have a four-door vehicle that meets specific company standards, have had an in-state driver’s license for at least one year, have in-state plates with current registration, pass a background check and driving record check, and have in-state auto insurance with his or her name on the policy. This last requirement — auto insurance — is becoming the unforeseen catch that has some current and prospective rideshare drivers hitting the brakes. Uber and Lyft each provide $1 million in liability coverage and $1 million in coverage if a collision involves an uninsured or underinsured driver. The coverage each company offers is identical except Uber’s comprehensive or collision deductible is $1,000 while Lyft’s is $2,500. The real issue lies in which coverage applies — one’s personal policy or the rideshare company’s policy — during each “phase” of a ride. Phase 1: The driver turns the app on with his or her smartphone to signal availability. If something happens during this “waiting” phase, neither Uber nor Lyft provides comprehensive or collision insurance. The driver must file a claim with his or her personal auto insurer. Phase 2: The app signals that new passengers are ready for pick-up; the driver heads to their location. En route to pick up designated passengers, full coverage by Uber or Lyft applies should an accident occur. Phase 3: The passengers are in the driver’s vehicle and headed for their destination. As with Phase 2, Uber or Lyft provides full coverage. The loopholes Drivers can breathe easier during phases 2 and 3, but phase 1 presents a grey area that could ultimately cost drivers their rideshare incomes as well as their personal auto insurance coverage. The reason? When a driver purchases auto insurance, the insurer is offering personal coverage, not business coverage. If something happens while “on the clock” waiting for a passenger, a driver is technically “for hire” and engaged in business activity but is not yet in that window of Uber or Lyft coverage. So, remember that personal auto insurance required to be a Lyft or Uber driver? If an insurer drops personal coverage, that driver’s eligibility to work as a Lyft or Uber driver also vanishes. Without proper coverage, a 10-second accident could mean a driver loses his or her auto insurance and ability to work as a driver — plus may be on the financial hook for property damage and injury. Ouch! Coverage options Fortunately, many insurers have recognized this problem and now offer rideshare coverage to applicable customers. Some companies call it “gap coverage,” others “hybrid coverage.” Whatever the name, it’s designed to protect a driver during that first phase of rideshare activity. While costs vary by company, some go so far as to offer continuous coverage that protects drivers during all phases of rideshare driving with lower deductibles than the Lyft and Uber policies. However, just because an insurance company offers rideshare coverage doesn’t mean it’s available to all rideshare drivers. Insurance is regulated on the state level, so the state a driver holds his or her driver’s license in determines what — if any — gap coverage is available. For those living...

Read More

3 Essential Steps to Protecting Your Business from Extreme Weather

Posted by on Jul 24, 2017 in Business Insurance | 0 comments

3 Essential Steps to Protecting Your Business from Extreme Weather

In June, severe weather cost the U.S. economy over $3 billion. Insurance companies covered at least $2 billion of that damage. To help compensate for the costs of increasingly extreme weather, many insurance providers have begun raising their premiums and deductibles, making it more difficult for business owners in areas prone to harsh weather conditions to obtain the severe weather coverage they need. In fact, 40% of businesses never reopen after sustaining severe damage from a natural disaster. Here are the three most important steps to protecting your business — and your wallet — against severe weather damage: Find the right policy for your business. It is bad enough to get trapped in a severe storm — and even worse, also getting trapped in an ill-fitting insurance policy. Not all policies offer the same coverage. A typical commercial property policy will not cover damage from floods, hurricanes, or earthquakes. You may need request additional “rider” policies to get the coverage you need. While this added coverage could increase overall insurance plan costs, you can help keep your premium low by bundling multiple policies with one provider and taking steps to prevent storm-related damage to your property. Protect your property to keep your premium low. Insurance companies often reward clients for taking measures to protect their properties against storm damage. For example, when property owners remove vegetation and other kindling, some insurers offer discounts for adding these buffers against fire around properties. If you live in an area with frequent high wind storms, wind resistant doors and storm proofed windows could help protect your business while also decreasing your premium. Another good reason to take steps to protect your property: Not all insurance policies cover what is inside your business. Check with your provider to ensure your policy covers the building frame and your property inside. Understand your policy’s replacement cost vs actual cash value coverage. Most commercial property insurance plans will provide replacement cost coverage or cash value coverage. While both of these features are designed to reimburse you for damage to your business and belongings housed there, they do not offer the same coverage level.Replacement cost coverage compensates you for the cost to repair or rebuild your property based on construction costs. Since replacement cost is not based on the market value of your property, it will not account for the value of your land.Actual cash value coverage will also pay to help you repair or rebuild your property, but under this type of coverage, insurers deduct the depreciation cost from the value you receive. If the depreciation level is high and you only have actual cash value coverage, it may cost more to rebuild your business than what your insurer is willing to pay.Talk with your insurance agent about whether your policy provides replacement cost coverage or actual cash coverage to determine which is more appropriate for your business. Protect yourself today from whatever tomorrow may bring The trick to protecting your business from severe weather is to take steps before a storm hits. Act now because you cannot purchase insurance after your property has already been damaged. Contact a Concklin Insurance expert today to better understand your policies. We’ll help you ensure you have the insurance coverage you need so you can hope for the best and be well-prepared for the...

Read More