Lower Your Auto Insurance Costs

Image by shainelee via FlickrI remember listening to a talk radio program on the AM dial about a year ago where the host stated that he chose not to participate in the economic recession.  Now he spends a good portion of his program showing empathy to his listeners who have been affected by the economic downturn.  No matter where we live, our neighbors are tightening their belts, spending less, and pinching their pennies.  As a father of five young children, I find myself doing the same.  Here are some ideas that may help you save money on car insurance without having to shop around.

Automobile insurance premiums often take a big bite out of a family’s budget. You may, however, be paying too much for this coverage. The following are several approaches you can use to reduce your auto insurance costs.

• Choose higher deductibles, particularly if you currently have a low collision or other-than-collision deductible, such as $100 or $250. Increasing your deductible from $250 to $500 or $1,000, for example, can reduce your collision and other-than-collision premium by 15 to 35 percent.
• Eliminate collision and other-than-collision coverage on older, less valuable cars. If your car is worth less than $1,500, it may be wiser and cheaper in the long run to just retain this physical damage exposure. Used car valuations are available online at Kelley Blue Book.
• Maintain an excellent credit record, since insurance companies are increasingly using credit scores to price auto insurance policies. Consumers with poor credit often pay more for auto insurance. 
• Buy a “low-profile” automobile. Before you purchase a new or used car, check into the auto insurance costs. Automobile models that are expensive to maintain and have higher theft and collision frequency rates tend to have higher insurance costs. 
• Take advantage of multipolicy discounts by keeping your homeowners and auto policy with one insurer. Likewise, take advantage of multicar discounts by having all autos on one insurance policy.
• Seek out other auto insurance discounts (which can vary by state and by insurance company), such as defensive driving, good student, low-mileage auto, alcohol awareness training, air bags, antilock brakes, claim-free experience, and long-term customer. 

PROPERLY PROTECT YOUR MANUFACTURED HOME

Manufactured homes offer great bargains for many consumers due to a much lower price as compared to site-built homes. And some independent appraisals are now confirming that these homes can appreciate in value just like other forms of housing.

Manufactured homes, however, can often pose higher chances of loss from a variety of perils, such as fire and windstorm. This is where safety and sound loss control practices come into play. The following are some fire loss control tips to consider for your manufactured home.

• Don't overload electrical outlets. Manufactured home fires are caused by problems in the electrical system twice as frequently as in site-built homes. Protect yourself by monitoring your electrical use. When one powerful electrical appliance is in use, for example a microwave, keep the use of others to a minimum.
• Make sure you have an adequate number of smoke alarms and regularly check the batteries. You should have a smoke detector in each part of the home in which people will be sleeping.
• Contact a licensed technician to inspect your furnace at least once a year. The blower and filters should also be regularly cleaned to prevent overheating.
• Make sure that your wiring and appliances are maintained in good working order. Faulty wiring is one of the leading causes of manufactured home fires.
• If you have a natural gas or liquid propane line coming into your home, make sure you know where the shutoff valve is and how to operate it.
• Verify that your lot is clearly marked since the fire department will need to be able to see the numbers on your home in case a fire or other emergency occurs.
• Other perils to consider are windstorms and tornadoes, since manufactured homes are particularly susceptible to high winds. The following are some wind-related loss control tips to consider for your manufactured home.
• If you don't already have one, consider installing a longitudinal tie-down system at the front and rear of your home. These systems rely less on ground anchors; they also reduce the effects of corrosion and rust on wind uplift resistance.
• Replace straps or ground anchors that are loose or ones that show signs of rust or corrosion. You should also check for proper installation of ground anchors and stabilizer plates.
• Install sliding storm shutters on all windows.
• Prior to severe weather, get together with the other residents at your manufactured home park and your park owner/manager to designate a safe shelter area in the park or community. When severe weather threatens, go quickly to this designated site.
  

KIDS, CARS, AND CAR SEATS

Image via Wikipedia

According to NBC News, about 340 children have died from being left unattended in a vehicle in the last 10 years. Such tragedy does not have to happen; it can be avoided. Here are some suggestions you might want to incorporate into your daily routine if you have small children in your car.

• Put something you'll need like your cell phone, handbag, lunch, or briefcase on the floor in the back seat.
• Get into the habit of always opening the back door of your vehicle every time you reach your destination.
• Ask your child's day care provider to phone you if your child doesn't show up when expected. Many children's lives could have been saved by a telephone call. Give childcare providers all phone numbers, including those of family members or friends.
• If you see a child alone in a vehicle, call 911 immediately.
• Keep a large teddy bear in the child's car seat when it's not occupied. When the child is placed in the seat, put the teddy bear in the front passenger seat.

Remember that driving a car is the single most dangerous thing we do each day. Always be sure to use an age-appropriate car seat when you have a small child in the car.

And, although flying on a scheduled airliner is certainly safer than riding in a car, don't forget the car seat if you are flying with your little one.

If you don't have -- or cannot afford -- a car seat, there are several agencies that can help. Please call your insurance office and they can put you in touch with the right people.

EVALUATE YOUR HOME'S NEED FOR A LIGHTNING PROTECTION SYSTEM

A lightning protection system is designed to control or redirect a lightning strike to a specified path. The system does not prevent a strike, but provides a path on which the electrical current can safely be redirected to the ground. Its objective is to prevent destruction or injury as the lightning travels that route. According to the Lightning Protection Institute (LPI), the system is composed of several key components, including the following.

• Lightning rods -- inconspicuous slender rods installed on the roof at industry-specified intervals.


• Conductors -- aluminum or copper cables that interconnect the lightning rods and the other parts of the system.


• Ground terminations -- metal rods driven into the earth to redirect the lightning current harmlessly to the ground.


• Surge arrestors and suppressors -- devices installed in conjunction with a lightning protection system to safeguard electrical wiring and electronic systems and equipment.

So is a lightning protection system a wise purchase for your home? Most lightning experts recommend that individuals owning homes with several of the following characteristics or features should purchase a lightning protection system.

• Previously has been struck by lightning


• Located in a neighborhood which has experienced lightning damage


• Located in a community or city that has experienced over 25 thunderstorm days a year


• Located in an isolated and open area, or on a hill


• Has aluminum siding


• Has a brick, stone, or metal chimney


• Has a high or large satellite dish


• Has a metal or wood roof


• Has tall trees overhanging the roof


• Lacks surge protection on the electrical panel or on incoming phone lines

Lightning protection systems should meet the code established by Underwriters Laboratories and the LPI. Note that some insurers provide premium credits for homes with these types of certified systems.
For an average size home, the cost for this system ranges from $2,000 to $3,000.

INSURANCE TO VALUE: HOMEOWNERS BEWARE

Housing values have plummeted throughout the United States.

The pace of existing-home sales dropped more than 8 percent from January 2008 to January 2009, reported the National Association of Realtors. Home values declined for 76 percent of all U.S. homes during 2008, estimated Zillow.com. And housing prices have fallen in 70 percent of all metro areas over the past several years, according to Moody’s Economy.com. What’s more, the rate of new-home construction is now at its lowest in 50 years, noted the U.S. Census Bureau and Department of Housing and Urban Development.

What’s not going down, though, is the cost of rebuilding and repairing houses. Construction costs rose by more than 4 percent between 2007 and 2008, according to a report in Best’s Review magazine citing Reed Construction Data figures.

Rising reconstruction prices are contrary to the economic news of recent months. And it’s contrary to consumers’ expectations that lower home values should mean lower homeowners coverage is needed.

What’s more, homeowners are already cutting back on insurance expenses. Nearly one in four households already have changed their insurance coverage in the past year to reduce costs, according to a recent survey by the Independent Insurance Agents & Brokers of America (the Big “I”) and local Trusted Choice® member agencies.

With these conflicting pressures, what should a homeowner do? The first thing: Recall what homeowners insurance is designed to do.

Insurance should “make whole” the policyholder after loss or damage to the home from an unforeseen event such as a fire, lightning strike or windstorm. In the case of rebuilding a home, “making whole” means rebuilding the same or similar structure.

When a home is damaged or destroyed, there are several issues that factor into its repair or replacement cost:

• Debris must be removed and discarded.
• Lumber, concrete, and other building materials are in demand on the worldwide market, even if demand is slumping in the United States.
• Building materials are purchased for just one home, not on a large-scale basis as for most housing developments.
• Fuel costs, a big part of construction costs, are higher than just a few years ago.
• Natural disasters in the U.S. have left a shortage of building materials and labor in certain areas.
• Homeowners want to get back into their home as quickly as possible, and speed drives up costs.

The second thing a homeowner should do: Check with your Trusted Choice® insurance professional to see that your insurance program reflects current economic conditions.

Trusted Choice® insurance professionals use the term “insurance to value” to denote that the dwelling limit in the homeowners policy is tied to replacement cost (and not to resale value). Your insurance carrier may periodically analyze replacement-cost trends and suggest adjusting the insurance value of a home.

Check with your Trusted Choice® independent insurance agent about keeping the coverage current. Your Trusted Choice® agent is an advocate at time of claim. But the most important protection for homeowners is to have the proper amount of homeowners insurance—not too high, not too low.

PURCHASE SPECIAL INSURANCE FOR YOUR HOME-BASED BUSINESS

The United States has experienced a rapid growth in home-based businesses in the last decade. The U.S. Census Bureau reports that there are now more than 11 million home-based businesses in the country, a figure that is expected to rise in the coming years.
But if you run a home business, losses associated with that business may not be covered under your homeowners policy unless special coverage endorsements are added. Some insurers sell an endorsement that covers losses associated with a home-based business. We can quickly find out if such an option is available.
What if you are operating a home-based business without your insurer's knowledge? Suppose you had a small fire that damaged your home office and computer and resulted in some lost income. Once your insurer sends an adjuster who, while investigating your claim, discovers your business, your insurer may deny some or all of the claim because of business-related exclusions and restrictions found in many homeowners policies.
Conversely, if you paid the additional premium to add a home-based business endorsement to your homeowners policy or you bought a businessowners policy (BOP), your loss would likely be covered—even the loss of income. (A BOP is a separate policy form designed to insure the property and liability exposures of small businesses.)
And do not forget about liability. If you have business visitors in your home and they get hurt, many insurers' homeowners policies will not cover those injuries because of the business-related loss exclusion found in the personal liability section of the policy. Again, it is necessary to purchase a special endorsement to the homeowners policy or a separate BOP. Also, if your activities give rise to any type of errors and omissions or professional liability exposures, they are not likely to be covered under either your homeowners policy or a BOP. A separate errors and omissions (E&O) policy will need to be arranged for this loss exposure.
Different insurance companies have different criteria for excluding business-related losses from their policies. If your current insurer cannot respond to your coverage needs, we can present several options to you.
But the important thing to remember is this: if you are running a business out of your home, call us. We will work hard to assure you are properly protected.

INSURANCE PURCHASING IDEAS FOR HOMEOWNERS

In some parts of the country, consumers have faced substantial increases in their homeowners insurance premiums, particularly in coastal areas subject to hurricanes and windstorms. Other consumers have experienced reduced coverage, moving from all risks coverage for their dwelling to named perils coverage. Still others have received nonrenewal notices due to minor losses, such as water damage claims. The following are some insurance purchasing tips that may help you save premium dollars and reduce losses on your homeowners policy.

1. Try to increase your deductible to the highest one you can afford, even if the premium savings do not appear to justify it. This will decrease your premium and increase the likelihood that your loss history will be excellent, since minor losses will be paid by you and not your insurance company. A loss-free record over time saves premium dollars. For example, if you currently have a $250 deductible on your homeowners policy, consider increasing it to $500 or $1,000.


2. Consider purchasing a monitored burglar alarm. Alarms have proven successful in reducing burglary rates. In addition, most insurers provide premium discounts to consumers with these alarms, some as high as 20 percent.


3. Maintain your home in optimum condition. If a repair is needed, perform it as soon as possible. For example, loose or missing roof shingles should be repaired or replaced immediately. A home in excellent condition is much less likely to experience a loss.


4. If you plan to buy a home, be aware that many insurance companies offer new home discounts. Some insurers offer the highest discounts, such as 20 percent, on brand-new homes and gradually lower discounts for several years as the home ages. Some insurance companies are now offering discounts for homeowners who are age 50 or older.


5. Request a copy of a Comprehensive Loss Underwriting Exchange (CLUE) report on the home you are considering buying. This report provides a list of prior losses for a particular home. It is generated from a database of insurance losses compiled by a high percentage of insurance companies. You can normally contact your current homeowners agent to get this information on a prospective home. Be wary of purchasing a home with prior foundation, water, or mold losses.


6. Install and maintain smoke alarms throughout the house. It is best if the alarms are interconnected, so that if one goes off, they all go off. Test the smoke alarms once a month. These detectors should be approved by Underwriters’ Laboratories (UL) or other recognized testing laboratories. Most insurance companies provide discounts for homes with operating smoke alarms.

COMPLETE A HOME INVENTORY

Do something now to make your life simpler in the face of a crisis. In the event of a crisis where you experience a serious loss in your home, the last thing you want to do is sit down and try to remember item by item the contents of your abode.

Here are some ways to do a home inventory. I'll list them from worst to best.

• Grab a camera and take digital pictures of every room of your home. Don't forget closets, the basement, and the garage. Take pictures of the contents of your woodshed and the outside of your home too. Most homeowner insurance provides coverage for plants too, so don't forget your prize orchids!
• Take out the video camera and shoot a real home video. Take video of everything mentioned above and don't forget the commentary!
• Accompany your home video with a home inventory list. There are many home inventory options available. You can take out a notepad and start to write down every item in your home and its value, or you can visit http://www.knowyourstuff.org/ and download their free Home Inventory software. This software will allow you to track your posessions room-by-room. They even allow you to store the inventory in a secure online vault for a fee (currently $14.99/year).

Don't forget, no matter what type of home inventory you create, DO NOT STORE IT AT HOME!!! Make at least two copies and store them at other locations. This will ensure that your list isn't destroyed by the same event that affected your home.