Monthly Archives: September 2015

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Minimum/Low Limits on Personal Auto Policy

Too many times we hear customers & potential customers tell us “I only need minimum limits, this car is a piece of junk” or “I only drive it to work a few minutes away, I just want to be legal”.  What people don’t realize is that you can do just as much damage with an ’87 Chevy as you can with a brand new Range Rover and you can get in an accident 2 miles from your home just as easy as you could if you were 100 miles away.  If you don’t want to get “full coverage” on your old hunk of junk, that’s fine BUT don’t get cheap on the bodily injury & property damage limits.  That’s the coverage that is going to be most valuable to you and that’s where you should have the highest limits you can afford.

 

You can do as much damage with this:

Chevy

 

As you can with this:

 

Range Rover

 

Another important coverage that often gets overlooked by customers is uninsured/underinsured motorists coverage.  This coverage protects you against drivers who don’t have any insurance or who have minimum/low limits.  You don’t want to skimp on this coverage either.  If you are hit by someone, would you want them to have the state minimum limits or would you want them to have the highest limits available?  If you are simply going with the cheapest option, you’ll likely have next to no coverage here and if one of those uninsured drivers hits you, you could be without coverage (over 10% of drivers have no insurance, even more have low/inadequate limits).  Think about what coverage you’d like that person who hits you/your car to have and that’s what you should be basing your decision on, not what the cheapest option is or who has the best commercial….even though some of them are pretty funny. Price is certainly a factor when making a decision on what insurance company to go with but it should not be the only factor or the most important factor.  Look at it like buying a pair of gloves or a pair of shoes – would you buy a pair of gloves with only 4 fingers on each hand?  Would you buy a pair of shoes with holes in them just because they’re cheap?  Probably not because then they won’t do what you bought them to do.  You are buying insurance to protect yourself and your assets.  Don’t just look for the cheapest policy and don’t try to do it on your own.  Call an agent and get some advice.  Many times you can end up saving money and getting better coverage but focus on the coverage first & foremost.  Even if you spend a little more than you think you should, you’ll be glad you did if/when you have a claim.

Why do you need a personal umbrella policy?

There are a number of reasons why you should have a personal umbrella policy. First, if you don’t know what a personal umbrella policy is, it basically provides excess coverage should the liability limits on your personal auto and/or homeowners policy be used up. For example, if you have a $500,000 personal liability limit on your homeowners policy and you have a liability claim for $750,000, your homeowners policy would pay the first $500,000 and then IF you have an umbrella policy, it would pay the remaining $250,000. ┬áTypically, umbrella policies can be purchased in increments of $1,000,000.

Here are a few examples of situations where an umbrella policy could protect you & your family’s financial well-being:
– A guest of yours is severely injured while diving into the pool at your home and is unable to work. Between the medical bills and the lost wages, the total amount they are suing you for (yes, even friends will sue you) is $1,000,000. You have $500,000 in liability coverage on your homeowners. If you have an umbrella policy, that will cover the remaining $500,000. If you don’t, your house may become your friends house.

– You severely injure a doctor in an auto accident. Again, between the lost wages and medical bills, the claim is worth $1,000,000 which is much more than your auto liability limits of $250,000 per person. Your umbrella policy would step in and pay the remaining $750,000.

– You’re playing golf and you shank one into someones backyard and seriously injure someone. That someone is a lawyer who makes 6 figures. You can bet he’ll be suing you for his medical bills, lost wages, & future earnings. Your homeowners liability (which you can also get if you are a renter) will provide some coverage but will it be enough to fully pay the claim? If it’s not, your umbrella policy will kick in and cover the balance.

– You are driving home after you hit that lawyer with the golf ball when you’re hit by an uninsured driver (over 10% of drivers out there don’t have any insurance at all…even more have low/inadequate limits). Your injuries are very serious and you’re unable to work. You can’t sue the other driver because that person has no assets and no insurance so now what do you do? Assuming you have uninsured/underinsured coverage that may help but that could quickly be used up and now you are on the hook….unless you have an umbrella policy which provides excess uninsured/underinsured coverage.

If you drive a car, if you ever have friends over your home, if you own a pool, if you play golf or have other hobbies….basically, if you ever leave your home, there is a chance that something could happen and you need an umbrella policy! Get a quote on a personal umbrella TODAY!