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Have you ever added a teen driver to your auto policy and been shocked at the increase of your premium? There are many factors as to why adding a teen driver to your policy can be quite pricey. Check out Safeco Insurance’s blog post below to read more about what could be causing your price to jump up.
Personal lines umbrella policies are meant for an added source of coverage, and as of lately they have become more and more popular. Check out what one of our carriers has to say about why you might need and want an umbrella policy.
Why You Need a Personal Umbrella Policy
One of the most important insurance policies you can buy is the personal umbrella policy, but many people are unaware they need one. This policy provides high limits of liability to protect you against a catastrophic liability loss. For example, a major car accident may injure numerous people or cause head injuries or death that will result in liability far in excess of the limits typically purchased in a personal auto policy. An umbrella policy sits on top of the auto and homeowners policies to provide higher limits of protection. In addition to providing higher limits, this policy normally pays for some losses not covered by the underlying policy, such as legitimate allegations concerning libel or slander.
Personal umbrella policies are growing in popularity. In the past, only wealthy individuals and families purchased this coverage. Today, middle-income families also may procure this policy for protection in our society’s increasingly litigious climate. As the tendency to sue for damages rises and awards granted by the courts grow, the personal umbrella policy is increasingly seen as an insurance necessity, rather than a luxury. It is especially attractive because of its relatively low cost.
In particular, people with certain characteristics or who engage in certain activities have a higher-than-average need for a personal umbrella policy. These situations include the following:
Indeed, one could even argue that a lower-income person needs an umbrella policy. Consider an apartment dweller who inadvertently starts a fire while smoking in bed, and the fire damages adjoining apartments. The smoker’s liability exposure could be enormous in such a situation. So, once again, a personal umbrella policy is a wise purchase for people in nearly all income groups.
If you have more questions on Umbrella policies, contact your local IMT Agent today!
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Copyright 2018 International Risk Management Institute, Inc.
Full Coverage vs. Liability
Are you in the market for auto insurance but can’t decide between full coverage or liability only? Or, maybe you’re still trying to decide what the difference is between the two. Fear not, below I have lightly explained some of the simplest ways full coverage and liability insurance differ.
Liability Insurance
Liability insurance is required by law when owning a vehicle and will only cover damages you’ve caused to somebody else. For example, if you get into an accident and you are found at fault and legally liable, you are expected to cover any bodily injury and property damage you have caused. If you are properly insured your insurance carrier should cover the damages incurred. However, another thing to keep in mind is your liability limits. The liability limits you choose is the maximum amount your insurance carrier is liable to pay if you are found at fault in a covered accident.
As an example, If you choose to carry the state minimum liability limits, 20/40/15 in the state of Iowa, your insurance is only responsible to cover property damage up to $15,000. If you were to total a car with these liability limits and the property damages you’ve incurred are $50,000, you are now responsible to pay for the remaining $35,000 of property damages. The same rule applies when dealing with bodily injury coverages. An important thing to note about liability coverage is that it does not cover damages to your own vehicle.
Full Coverage
Having full coverage on your car is an optional coverage if you own your vehicle. If you are leasing or purchasing a new car with a loan, full coverage is then required from the dealership or your loss payee.
When choosing full coverage you have the option to pick your deductible, most common being the $500 deductible for both comp & collision. Having a $500 deductible means that before your insurance will pay out for any damage done to your vehicle, you are required to pay the stated $500 deductible first. Full coverage is the only coverage that will pay for damages done to your vehicle if you were to get into an accident or have a comprehensive claim such as, hail or theft. While full coverage is the costliest of coverages it is an option that should be considered when determining which coverages are best for you.
When picking your auto insurance coverages make sure you are with an agent/insurance company that will help you better understand the options you have available to you. Understand what you are getting and what is being covered.
Disclaimer: information provided in this article is meant to give a rough explanation between full coverage and liability only. Every accident is different with numerous circumstances. How an insurance company will cover an accident varies.
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