Property and Casualty Insurance
Survivors can experience a strain on financial security during cancer treatment. In addition to income, financial security includes a need to be protected in case of an unexpected crisis, such as a major theft, natural disaster or a lawsuit. Having the appropriate property and casualty insurance coverage may help survivors lessen or prevent unexpected losses.
Property and casualty insurance includes coverage options such as auto insurance, renters or homeowners insurance. It also includes other types of coverage that can provide additional financial security. Understanding the protections and options that are available will help a survivor identify the best coverage for his or her specific situation.
This information is meant to be a general introduction to this topic. The purpose is to provide a starting point for you to become more informed about important matters that may be affecting your life as a survivor and to provide ideas about steps you can take to learn more. This information is not intended nor should it be interpreted as providing professional medical, legal and financial advice. You should consult a trained professional for more information. Please read the Suggestions and Additional Resources documents for questions to ask and for more resources.
For many survivors, finances can become strained during cancer treatment. Financial security involves more than having an income to provide for basic needs. There is also a need to be financially protected in case of an unexpected crisis, such as a major theft, natural disaster or a lawsuit. Such unexpected losses can be lessened or prevented by carrying appropriate property and casualty insurance coverage.
The term "property and casualty insurance" does not refer to a specific insurance policy. Instead, it is a category of insurance coverage that includes a variety of insurance protections that financially reimburse or make payment for property losses and/or harm to people. You will find property and/or casualty insurance coverage options within common insurance policies, such as auto insurance, renters or homeowners insurance. There are also other types of property and casualty insurance coverage that can provide you with additional financial security. Understanding the protections that are available will help you identify the best coverage for your situation.
If learning about and purchasing insurance seems overwhelming to you, ask for assistance from a professional, such as your attorney or a certified financial planner, a cancer advocacy organization, an insurance agent, a knowledgeable family member or friend. There will be peace of mind knowing that you have made arrangements to provide coverage for a possible emergency.
This document reviews the major types of property and casualty insurance and provides a basic overview of insurance options, including:
- Understanding property insurance
- Understanding casualty insurance
- Purchasing or renewing insurance policies
- Reducing the cost of insurance coverage
- Documenting your insurable assets
- Handling an insurance loss
- Understanding specific types of insurance
Understanding Property Insurance
Property insurance coverage protects against losses to your home or personal property. This type of insurance coverage provides protection against specific risks, such as damage caused by fire, theft or weather.
Property insurance has four distinct parts to protect your property:
- Dwelling coverage for physical damage to your home
- Other structures coverage for physical damage to your detached garages or other buildings on your property
- Personal property coverage for your belongings
- Loss of use coverage that provides additional living expenses in the event of a covered loss to your property
A good starting point for determining the amount of insurance coverage you should have for your property is to make a list of all of your physical assets. Your list should include the cost and current value of each asset, as well as the replacement costs for your valuable items, such as furniture, electronics, clothing, jewelry and collectibles including art or antiques. The amount of your property insurance coverage should be enough to replace all of these things if they were lost or damaged.
Property is insured in two ways:
1. Open perils (or all-risk perils): This type of property insurance covers all the causes of loss not specifically excluded or eliminated by the terms of the policy. Some of the most common exclusions include earthquakes and flooding.
2. Named perils: This type of coverage requires the actual cause of loss to be listed in the policy for insurance to be provided. The most commonly named perils include fire, lightning, explosion and theft.
When selecting your property insurance policy, also consider the two types of policies that are available in terms of coverage replacement values:
- Actual cash value policies pay you the actual value of the damaged or lost property at the time of loss. This amount may be lower than what you paid for the item because most items, such as furniture and electronics, depreciate or lose value over time.
- Replacement cost policies pay you the cost of replacing the damaged or destroyed property, even if the cost is higher than what you originally paid for the item. Replacement cost coverage is highly recommended but can be more expensive and higher premiums are likely. If you cannot afford this type of coverage, actual cash value coverage is better than having no insurance at all.
Your insurance company will take into account the location, condition of your property and the local crime rate to determine the cost of your property insurance policy.
Understanding Casualty Insurance
Casualty insurance covers the liability (legal responsibility) of the buyer for damages and injuries caused to other people and their property. This coverage protects your assets in the event that you are sued. This type of insurance is a broad category of insurance that includes almost any coverage that is not related to life, health or property insurance. For example, if someone suffers an injury while on your property and sues you for damages, casualty insurance coverage may pay for a settlement.
Casualty insurance is also called liability insurance because it protects you in case you are found liable for an accident or other negligence (neglect or carelessness). For example, if someone trips on a loose step on your property that you could have fixed, that person may sue you. If you have casualty insurance, your insurance company may pay for a settlement so that you do not lose any of your assets.
When considering what insurance coverage to purchase, make sure you consider each asset that you own that you cannot afford to lose. Also, be certain that your potential liability is covered. Keep in mind that a separate insurance policy is required to cover specific liability that may arise from operating any vehicle you own, such as an automobile, motorcycle, recreational vehicle or boat.
The amount of casualty insurance coverage you carry should be appropriate to the value of your personal and business (if you are self-employed) assets. The more assets you have that could be taken in a court settlement, the more casualty insurance you need. If you have few assets, a smaller amount of casualty insurance may be enough.
Purchasing or Renewing Insurance Coverage
Before purchasing or renewing insurance policies, check the financial reputation of the insurance companies, including their financial security and their record of paying claims. You can obtain this information through your state insurance commissioner and through online information provided by various independent insurance rating services.
While preparing to purchase or renew insurance policies, remember to consider the need for any extra coverage that may be necessary for:
- Property and valuables (assets) you want to protect
- Liability risks, such as a lawsuit because someone is injured on your property
- Specific risks, such as wildfires, earthquakes, floods or hurricanes or wind and hail storms
Some insurance coverage may have to be purchased separately. For example, homeowners insurance does not cover flood damage from rising water so coverage must be bought through the National Flood Insurance Program (NFIP).
When it is time to renew your policy, you may be tempted to simply renew the coverage you have with the same insurance company. However, first consider the current value of your assets to be sure that you purchase enough coverage. Keep in mind that you may need to increase your policy limits as your property and other assets increase in value. It is also a good idea to check every few years to see if you can get the insurance coverage you need at a lower cost.
When insurance is purchased, you make a periodic payment (premium) for the specific coverage that has been selected by you and written into your insurance policy contract. This premium is paid monthly, every few months or once a year depending on the contract. In return, the insurance company agrees to reimburse (pay) on future claims for losses that are covered by the policy you purchased.
Each policy has a dollar "limit." This is the maximum amount the insurance company will pay for a loss. When purchasing a policy, you need to be certain that the limit of each of your policies is high enough to cover your possible losses.
The following list defines the roles of professionals who typically assist people to determine the types and amounts of insurance coverage that are needed:
1. Insurance agents
An insurance agent sells insurance contracts and provides services as an authorized representative of specific insurance companies. Insurance agents must have specific licenses to sell different types of insurance, such as life, health, property and casualty insurance. Most states require that agents complete specified pre-licensing courses and state examinations covering the fundamentals of insurance and state insurance laws. An insurance agent may represent one company or several companies and must be licensed in the states where he or she sells policies.
An independent insurance agent sells insurance policies from many different insurance companies and is able to offer a wide variety of insurance products with varying premiums. An advantage to using independent agents may be that they can help you get the product that meets your specific needs at the best price. An independent agent may also be able to let you know which insurance companies respond quickly and efficiently to loss claims.
2. Insurance brokers
An insurance broker is licensed to work with both the buyer and the insurer, usually for a fee (commission) that is paid by the insurance company from which the policy is purchased. Brokers assist buyers (often business owners) with defining the insurance needed and purchasing the policy from a reputable company at a reasonable price.
Brokers are similar to agents, except that they are legally required to represent the buyer rather than the insurance company. Many brokers hold professional designations, such as Chartered Property Casualty Underwriter (CPCU).
3. Financial planners
A financial planner is able to offer advice about property and casualty insurance coverage. Some planners work only for a fee while others do not charge the buyer because they are paid a commission by the insurance company. Many people prefer to work with a planner who only works for a fee rather than a commission, as this will eliminate any possible conflict of interest. Experienced and educated planners usually have a professional designation, such as Certified Financial Planner (CFP).
4. Direct writing companies
A direct writing company is an insurance company that deals directly with the public and does not use brokers or agents. A buyer's options are limited to one company. This type of insurer is also called a direct writer or direct insurer.
In addition to doing your own research about insurance companies, there may be knowledgeable family members and friends who can help you decide on an insurer and insurance coverage that meets your needs. Talk with them about their experiences and any recommendations they might have.
Reducing the Cost of Insurance Coverage
A comparison of the insurance rates of similar policies may help you reduce insurance premiums. This can be done through quotes received from a number of insurers to find the best price and coverage options. You do not have to agree to buy a policy to get a quote. Keep in mind that lower premiums are not always ideal if coverage is too limited or the insurance company has a history of not paying legitimate claims in a timely fashion.
The following are ways you may be able to reduce the cost of property and casualty insurance premiums:
1. Think about increasing the deductible. Although some insurance companies have minimum deductibles (the amount you have to pay before insurance coverage begins), typically, the higher the deductible for the policy, the lower the premium. The amount of your deductible is selected by you at the time you purchase the policy.
2. Consider whether insurance coverage is even needed. For example, if you have an older vehicle with little value, you may decide that it is no longer necessary to carry collision or comprehensive auto insurance coverage. Keep in mind that if you decide to reduce or eliminate insurance coverage, you must be certain that you will still meet any minimum requirements for coverage that are required by your state. In addition, if you still owe money on your car, your lender may require you to have collision and comprehensive coverage.
3. Look for discounts. Some insurance companies offer discounts to customers for a variety of reasons, such as:
- Personal habits and merits, such as good driving records or good grades
- Anti-theft or safety features installed in vehicles or homes, such as security and alarm systems
- Purchase of multiple insurance policies through the same insurance company
4. Find out if there are group discount rates available. Check to see if you belong to (or could join) any organizations that offer a group discount on certain insurance policies. For instance, unions, fraternal organizations and associations may offer insurance discounts as a benefit for their members. While considering a purchase, keep in mind that it is not the discounts but the final cost that counts. For example, an insurance company that offers few or no discounts may still have the lowest premium rate and the best overall insurance package.
5. Think carefully about filing claims. Consider the possible affects of filing claims and collecting insurance reimbursement for small incidents. Small claims can increase premiums and sometimes cause the insurance company to not renew your policy.
Some states may have consumer protections regarding policy non-renewals due to claims. For example, the state may require that a written notice be sent by the insurance company to the policyholder advising that an additional claim within a certain period of time could result in a policy not being renewed. However, keep in mind that most states require insurance companies to follow a detailed process before they can decide not to renew policies.
6. Keep your credit in good condition. People with poor credit records usually pay higher premiums than people with good credit records. Your state insurance commission may be able to provide information about how poor credit may be used by insurance companies to determine premiums. Some states allow you to appeal for lower rates if poor credit is a result of medical expenses.
Documenting Your Insurable Assets
When you purchase an insurance policy, the insurer will usually accept your listing of valuables and your estimate of what each asset is worth. However, if you submit a claim for a loss of a valuable, the insurer may require that you submit proof of the item's value. Always keep proof of what you own, such as receipts, written estimates of value, photographs or videos.
Keep in mind that insurance companies consider the age and condition of property when evaluating losses, so you should also keep evidence of upgrades and other changes to your assets that may affect the value. Having proof of improvements and repairs to your property may increase the value of your assets and result in a higher claim settlement.
Some good ways to document your assets and their value include:
- Maintaining a current list of your assets, including a description of valuable items, the date of purchase, and any model and serial numbers
- Keeping receipts, copies of warranties and owners manuals, as well as copies of credit card bills as documentation
- Using good quality copies of photographs or videos to document your assets
- Storing documentation kept at home in a fireproof box or safe
- Keeping any documentation that cannot be easily replaced in a safe place away from your home, such as a safe deposit box. This is to ensure that the documentation will not be destroyed if there is a loss to your home, such as through a fire, flood or storm
If you do not have proof of the value of a loss item when filing a claim, some insurers may allow you to provide evidence of the current value of similar items that are of approximately the same age and condition.
Handling an Insurance Loss
The term "insurance loss" refers to a claim due to a reduction in value of property or bodily injury. A settlement (agreed upon amount of money and terms) is sought through a claim by the insured person under the terms of the policy.
If you have an insurance loss, call your insurance agent or broker to report the claim as soon as possible. Your insurance policy will specify exactly what you are supposed to do under the terms of your coverage. Proof of loss or damages will have to be provided within any time limits cited in the policy. Keep in mind that if you do not follow the policy terms, you may lose your right to recover damages through a claim.
The following are basic steps to follow at the time of an insurance-related loss:
- If a vandalism, theft or burglary has occurred, call the police immediately to file a formal report.
- Do not start permanent repairs before your insurance company's adjuster has inspected the damage and documented approval of coverage for your claim. Talk with your agent to get approval if temporary repairs are needed to protect remaining possessions. Take photos or video of the damage for your records and provide copies of these to the insurance company with your claim.
- If your home or possessions have suffered damage, such as from a fire or storm, try to prevent more damage as soon as it is safe to do so. For example, have your possessions moved out of standing water and into a secured place. See that temporary repairs are made to prevent further damage and that damaged areas in your roof or walls are covered to prevent additional rain or water from causing further damage.
- If you are involved in an auto accident, follow the specific instructions provided by your auto insurance company about what to do, how to report the claim and what timelines are required. Many insurers suggest that you write down identifying information about any other drivers and vehicles involved in the accident and take photos of the road conditions, skid marks and damage to any property. Auto insurance companies generally require that a police report be filed in cases of theft, vandalism or collision on a public street or highway.
- Depending on the amount of your insurance loss, you might decide to hire an attorney or a public insurance adjuster who is a claims expert to help you negotiate the amount of a claim award. Public insurance adjusters charge a fee for their services. The fee might be an hourly rate or a percentage of your claim settlement. Make sure you know how much the fee will be before you hire an attorney or public insurance adjuster.
Understanding Specific Types of Insurance
A basic understanding of the most common types of property and casualty insurance will help you sort through options and select coverage to meet your specific needs.
The following tables provide overviews of the most common types of insurance that are available, including:
- Homeowners insurance
- Auto insurance
- Rental car insurance
- Other types, such as travel, flight, specialized liability and worker's compensation for workers in your home
|Purpose of Homeowners Insurance
|Homeowners insurance policies combine property and casualty coverage into a single policy. This type of coverage is available to both homeowners and renters. It can be purchased to cover houses, condominiums, townhouses, cooperatives or rental property.
A homeowners policy provides enough property and liability insurance coverage for the average home and personal exposures (expense risks). This coverage protects your home and belongings against loss and provides coverage for liability and for injuries to others or damage to their property.
|For an additional premium, you can add riders (additional coverage) to your policy to increase or expand coverage for items, such as jewelry, electronics, fine arts and cash. You can also purchase a separate policy, sometimes called a floater, that contains a specific list of the items to be covered and the amounts of coverage for each item.
An all-risk coverage policy can also be purchased. These policies cover loss unless it is caused by an event (peril) that is listed as excluded in the policy. Assets that can be insured or covered by other policies, such as auto insurance, are not covered.
|Things That Are Covered:
- With homeowners insurance, your possessions are insured against loss, whether the loss occurs on your property (such as in a home burglary) or away from the property (such as theft from a hotel room you are staying in).
- If someone gets hurt on your property, casualty coverage pays for injuries, including medical and other expenses.
- The casualty portion of a homeowner's policy will pay to defend you against claims for property damage or for injuries you may have caused. If you are found responsible, this coverage will pay for damage to another party such as medical bills or repairs to damaged property.
- If your residence is a condominium or town home, the policy covers only the part of the property that you rent or own.
- If your residence is an apartment or other residence that you rent or lease, your renters policy may cover damage you cause to the residence due to your negligence. Renters policies also cover losses to your personal property as provided in a named peril or all-risk policy.
- Some insurance policies also provide additional living expense (ALE) coverage that generally includes coverage for expenses such as hotel or rent and food expenses if you are unable to live in your home while approved repairs are being completed. The ALE coverage is generally only available when the covered housing is not habitable because of a loss covered under your homeowners policy. The federal flood insurance program does not provide ALE coverage following a loss that occurred as the result of flooding or a storm surge.
- Some insurance policies may also provide loss of use coverage if a civil authority (for example, the mayor or governor) prohibits use of the residence because of direct damage to the area from a covered peril, such as fire or windstorm. This coverage may be limited to a specific period of time, such as two weeks.
|Things That Are Not Covered:
- Homeowners insurance does not include liability damages that result from the use of an automobile or other type of motorized vehicles. Liability coverage for other types of motorized vehicles may be limited to damage caused by motorized devices used to assist someone with a handicap, power mowers, golf carts and vehicles used for recreational purposes while on your residential property.
- Employees who work at your house are usually not covered by your insurance. You may need to purchase a separate workers' compensation insurance policy to cover workers in your home. Check with your state insurance commission for more information.
- Home-based business ventures or actions you undertake in the course of a business are not protected.
- Earthquake and flood damage are not covered, unless you have purchased special earthquake and flood policy riders. Federal programs have been established that allow insurance companies to sell separate policies for flood and earthquake coverage. However, earthquake riders are typically not available in certain earthquake-prone areas of the country.
- Depending on where you live, your policy might exclude coverage for windstorm or hail damage. If you are unable to get this type of coverage through private insurance companies, you may have to buy this coverage separately through a state-funded "assigned risk" or "wind pool" program.
- For multiple-unit structures, this insurance does not cover the entire building or the common areas.
- Most homeowners or renters policies are package policies. The first part provides coverage for property, while the second part provides liability coverage. This means that it may not be necessary to purchase a separate additional insurance policy to cover liability risks.
- You will need separate insurance policies for specific risks that are not covered under a standard homeowners or renters policy, including:
o auto insurance liability policies
o boat owners or personal watercraft liability policies
o recreational vehicle policies
o business liability policies
o professional liability policies, such as for accountants, medical personnel and attorneys.
- If you live in an area where flooding is possible, you must purchase a special flood insurance policy from the federal government. Homeowners policies usually only cover water damage caused by plumbing leaks or certain types of storm damage. Standard homeowners insurance typically does not cover damage from rising water, regardless of the cause.
- Homeowners policies have a limit on the amount of coverage for items such as jewelry, fine art or valuable collections. There may also be specific limits for certain causes of loss, such as a loss due to theft. A separate policy, sometimes called a floater, is necessary to cover these types of items. This policy contains a specific list of the items to be covered, as well as the amounts of coverage on each item. Floater policies are generally "all-risk" coverage and the item is covered whether it is stolen, destroyed or simply lost.
- Review your homeowners policy and any floater policies you have purchased to be certain you understand what is covered and what is not.
- In most states you can purchase an "inflation guard endorsement," which automatically increases the policy's coverage limits to keep up with rising real estate values and construction costs.
|Ways to Purchase This Type of Insurance:
- An insurance agent can meet with you to discuss your needs and determine appropriate coverage for you, including pricing and information about the claims service of recommended companies. This meeting should not cost you any money unless you decide to purchase coverage through the agent.
- A property and casualty insurance policy can also be purchased directly through an insurance company or an insurance agent without going through a broker.
- Certain business owners and consumers may choose the services of an insurance broker to meet their needs.
Defining the Replacement Cost Value for a Homeowners Insurance Policy:
The following are important things to consider when purchasing a homeowners insurance policy:
1. Extended replacement cost insurance coverage may provide a benefit of 20 to 80 percent more than the current value of the covered property. This extra coverage can be important because the overall costs to replace a home are likely to continue to increase and may easily surpass the initial cost of the home. However, keep in mind that some insurance companies may have limitations or caps on the amount of this type of coverage.
2. Guaranteed replacement coverage is generally offered by some insurance companies with no specified limit, although there may be limitations in some states. For example, a lender may be prohibited by state law from requiring an amount of insurance coverage that is greater than the replacement value of the property. This type of coverage guarantees that the insured house will be rebuilt to the same specifications with the same type of materials as the original, no matter how much the cost at the time of loss. You can also add a provision to your policy that automatically increases the amount of the coverage to account for inflation.
Consider the following when choosing your insurance coverage:
- Do you have your home insured for enough value to replace it in the event of a major loss?
- Would it be a good idea to purchase more than the amount you owe on your mortgage, even though that may be all that your lender requires? Some state laws may prohibit an agent from knowingly over-insuring real estate property against loss.
- How much would it cost you to rebuild your home from the ground up in case of a disaster?
- Do you have enough insurance coverage for any extra costs to meet new building codes if you currently own an older home?
- Has the value of your home been re-evaluated within the last few years?
Automobile (Auto) Insurance
|Purpose of Auto Insurance
|Auto insurance is needed and likely to be required in your state. This insurance covers loss to property as well as liability in case of an accident for which you are at fault. An auto insurance policy is a collection of different coverages. Most states require a minimum amount of certain kinds of coverage.
Basic auto insurance coverage includes:
Casualty/liability coverage: If you are at fault in an accident, this coverage will pay for bodily injury and property damage caused to others in the accident, including your legal expenses. This is the foundation of your auto insurance policy and many states require a specific minimum amount of coverage.
1. Bodily-injury liability: The most important coverage for medical costs caused by your driver and vehicle. This pays for another person's medical treatments, rehabilitation and other losses if they are injured in an accident in which you are at fault. It may also cover their lost wages.
2. Property-damage liability: Provides coverage against property damage caused by your driver and vehicle. This pays for the repair or replacement of things you damage, other than your own car.
Property coverage: Pays for repair or replacement of your car:
1. Collision: Pays to repair your vehicle and covers damage to your vehicle from an accident, no matter who is at fault.
2. Comprehensive: Pays for damages to your car that are not caused by an auto accident, such as a theft, damage caused by a storm, vandals or other events.
No-fault insurance is designed to pay medical expenses and lost wages caused by an accident, regardless of who was at fault. No-fault insurance is not required by every state and the systems vary from state to state.
|A basic auto policy does not cover everything that can happen with a vehicle. You may also want to purchase additional insurance coverage that is added to your standard auto insurance policy at a fairly low cost, such as:
- Medical Payments (MedPay) Coverage: Covers your household members and passengers who may not have enough health insurance to pay for injuries from a car accident. This also covers household members if they are injured by a motor vehicle when they are pedestrians.
- Personal Injury Protection (PIP): Covers medical expenses, lost wages, funeral expenses and other damages for you, members of your household, passengers and pedestrians affected by your automobile accident regardless of who is at fault. PIP is not available in all states
- Uninsured Motorist (UM) and Underinsured Motorist (UIM) Coverage: Covers bodily injury, property damage, medical and similar costs that result from an auto accident caused by an uninsured or underinsured motorist, or by a hit-and-run driver.
- Glass Breakage: Pays for the replacement of broken windows on your car.
- Rental Reimbursement Insurance: Pays for the cost of renting a car while your car is being fixed after an accident.
- Towing and Labor: Pays for the cost of towing your car after an accident or if your car breaks down. This may be limited to a certain distance or number of miles.
Gap Coverage: May be part of your auto insurance policy or is sometimes purchased as a separate policy. This coverage assists individuals who are financing their vehicles. Gap coverage pays the difference between the actual cash value you receive for the car and the amount left on your car loan if your vehicle is determined to be "totaled" in an accident. Your vehicle may be determined to be a total loss due to an unrecovered theft or if the insurance company determines that the damage to the vehicle is so extensive that the cost to do the necessary repairs would exceed the value of the vehicle.
- In most cases, the higher the deductible, the lower the insurance premium. However, if you select a higher deductible option, you will be responsible for a greater share of the costs (the deductible amount) if you make a claim.
- An insurance adviser can recommend the amount of coverage that will best meet your specific needs.
- Check insurance rates for a specific type of car before buying the car because the insurance premiums for certain vehicles can cost much more than the premiums for others.
- Before choosing medical payments or no-fault insurance protection, know the details of no-fault coverage in your state.
- Check to see if you qualify for any discounts with the insurance company.
- If you are told you have to go into an "assigned risk pool" (or high-risk category), see if another insurance agent can get you standard coverage.
- Do not use your vehicle for business unless you have to. Business use usually carries a higher premium than personal use. Some auto policies specifically exclude coverage for claims arising out of business use of a vehicle.
- If you have been ticketed for moving violations, check to see if attending a driving course will entitle you to a discount or reduced premium.
|Ways to Purchase This Type of Insurance:
|Get quotes from at least three different auto insurance companies so you can compare prices and services.
- Quotes can be obtained by calling insurance companies directly or by doing research on the Internet.
- Some state insurance departments also provide price comparisons of major insurers.
You need to select an insurance agent or company representative that will work for your best interests and who will take the time to answer your questions. Ask friends and family about their experiences and recommendations if you are having trouble deciding what to do.
Know the impact of applying for insurance with too many companies. Online companies that do business by taking your application to shop for and compare insurance rates will send your application to each insurance agency with which they do business. In turn, each agency will then run your credit report. Although you have only submitted one initial application for insurance, your credit is subsequently checked by every company that is sent your application for a rate quote. This means that your credit is checked multiple times, and each check can reduce your credit score.
A better way to find the best insurance policy is to do your own research to learn about:
- The financial stability of the insurer
- The insurance company's record of payment on insurance claims
- The costs for coverage
- The general reputation of the insurer with its customers
An independent broker who works with multiple insurance companies will be able to provide information and recommendations based on their previous experiences with customer claims. Also, consider reading the reports of independent insurance rating companies that are posted on the Internet to find an insurer that is rated "excellent" or "superior." Knowledgeable family and friends also may be able to share information about their own insurance preferences.
Rental Car Insurance
Understand the coverage you already have for rental vehicles through your own auto, renters or homeowner insurance policies, including:
- collision and comprehensive insurance
- liability insurance for bodily injury and property damages
- accidental death and personal property insurance
- "limited" coverage for personal property that could be stolen from the vehicle.
Compare your current coverage to the coverage offered through car rental companies to define what you need:
1. Read your personal auto policy to see if it also provides coverage to you when you rent a car. If you do not understand your policy or cannot find it, then ask your broker, agent or insurance company to provide you their answers in writing.
2. Next, check your credit cards to see if they provide rental car coverage. If any of them do, then use one of those cards to rent the car. If you are using the car for business, check to see if your employer insures the trip.
3. If none of these options are available, you may want to purchase insurance coverage from the car rental company although this coverage is typically expensive. As with your own car, coverage is needed for:
o Property and personal liability
o Physical damage to the car
o Bodily injury to the passengers
Other Types of Insurances
There are many other types of property and casualty insurance coverage available. You can learn more about these by speaking with an insurance professional. Also consider asking family or friends if they have had experience with these types of coverage and with insurers who sell the policies.
Other insurance coverage that may be of interest to you includes:
- Boat owners, motorcycle and recreational vehicle (RV) insurance policies must be purchased separately from your auto insurance. There are a variety of options available. Check with insurance agents or insurance companies for specific information on coverage and costs of these types of policies.
- Travel accident policies are limited contracts covering accidents that occur only while an insured person is traveling on business for an employer, away from the usual place of business, and by a method of travel specified by the policy.
- Travel insurance is purchased for a specific travel event. It reimburses your costs if you have to cancel a trip because of your health or some other condition specified in the policy. This coverage may also include emergency medical care while traveling, including emergency evacuation to another location.
- Flight insurance is purchased separately per flight as a type of life insurance that specifically covers you for that air travel.
- Child support insurance pays child support payments if the supporting spouse loses his or her job.
- Director's and officer's liability covers against liability if you serve as a director or officer of a group or business, including nonprofit organizations.
- General liability and professional liability provides specific coverage for professionals and small businesses.
- Earthquake and flood insurance covers the specific risks mentioned.
- Pet insurance covers veterinary medical treatment and/or hospitalization for injury and illness to pets.
- Umbrella policies cover liabilities that exceed your basic policies. For example, if your homeowners policy comes with a defined amount of liability coverage, but you have assets that are worth more than that amount, you can purchase an umbrella policy to raise that limit to whatever amount you want. Each umbrella policy generally covers all your liability policies, such as homeowners and auto insurance.
Umbrella policies are considered to be "excess policies" that pay in addition to (not in place of) other policies. Most umbrella policies require that you also carry an underlying policy for coverage to be in effect, such as auto insurance or homeowners insurance.
- Workers' compensation insurance protects against the possibility that someone who works for you has a work-related injury. If someone works for you in your home ("domestic employee"), be certain that they are covered by a workers' compensation insurance policy. If a worker was referred through an agency to work on a temporary basis, this coverage may be provided by the referring agency. You need to ask to see a copy of the agency's certificate of insurance coverage to be sure the worker is covered.
Also, find out if your homeowners or renters insurance policy provides any (and enough) liability insurance coverage for people you hire to do work around your home. If there is not, find out if your state requires workers' compensation coverage for domestic employees. If this type of insurance coverage is required and is not already being provided for people working in and around your home, you may need to consider purchasing a workers' compensation insurance policy to cover them.
Take the time now to ensure that you will be financially protected in an unexpected crisis by property and casualty insurance. Keep in mind that a cancer advocacy organization and/or insurance and financial planning professionals can provide you with assistance to identify and understand the specific protections that are available to meet your unique situation.
This document was produced in collaboration with:
David S. Landay, Esq., author of Be Prepared: The Complete Financial, Legal and Practical Guide for Living with Cancer, HIV and Other Life-Challenging Conditions.
Landay, David S. Be Prepared: The Complete Financial, Legal and Practical Guide to Living with Cancer, HIV and Other Life-Challenging Conditions. New York: St. Martin's Press, 1998.
Nissenbaum, Martin, Barbara J. Raasch and Charles L. Ratner. Ernst & Young's Personal Financial Planning Guide. New York: John Wiley & Sons, Inc. 2004.
Petersen, David. Seminar: Financial Planning for People with HIV/AIDS. New York, 1994.
"The Basics of Rental Care Insurance." Insure.com. The Consumer Insurance Guide. 14 November 2006.
U.S. General Services Administration, Federal Citizen Information Center. 9 Ways to Lower Your Auto Insurance Costs. New York: Insurance Information Institute, 2006.
"Workers Compensation." Insurance Information Institute.org. New York: Insurance Information Institute. 15 August 2006.
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Property and Casualty Insurance: Suggestions
The suggestions that follow are based on the information presented in the Detailed Information document. They are meant to help you take what you learn and apply the information to your own needs. This information is not intended nor should it be interpreted as providing professional medical, legal and financial advice. You should consult a trained professional for more information. Please read the Additional Resources document for links to more resources.
Keep contact information for all of your insurance companies in a place where you can find it easily. Also keep information from the insurance companies about what to do in the event of a loss.
Know what your auto and homeowners insurance policies cover. Identify gaps in coverage so you can make an educated decision about the need for additional insurance.
Photograph, videotape and keep documentation of your valuable possessions. Store the images in a safe place, not on the premises where the possessions are located. Although not required by most insurance companies, this evidence will be helpful if you have a loss.
Pull together any receipts or bills you have for your possessions and store these in a safe location. This provides both proof of ownership and proof of value in the event of a loss.
Whenever you renew a policy, check to see:
- If you can get a lower premium
- Whether you qualify for additional discounts
- If the value of your property has increased or decreased
- If you have obtained, given away or sold assets without changing the appropriate insurance policy
- Whether you should continue to keep your coverage on an asset that has decreased significantly in value.
Review the following suggestions that the insurance industry recommends to lessen the cost of your auto insurance:
- Check to see if there are discounts for which you can qualify.
- Compare insurance costs before you buy a new or used car.
- Request higher deductibles (if you can afford them) to lower your premium costs.
- Consider the risks and benefits of reducing collision coverage on older cars.
- Find out if you can get a reduction by buying your homeowners and auto coverage from the same insurance company.
- Establish good credit and make certain your credit record is accurate.
- See if you qualify for low mileage discounts.
- Find out if you can qualify for group insurance through your employer, groups or clubs.
Check your insurance policies to find out what to do in the event of a loss.
When it is time to renew or purchase insurance policies, remember to consider the current value of your assets to be certain you purchase the right amount of coverage.
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The resources listed below provide more detailed information and support services to help you with property and casualty insurance. Please read the Detailed Information and Suggestions document for more information and questions to ask.
Click a resource for more information:
||Send email through the Web site.
||1-888-OUR AARP (1-888-687-2277)
Calls are answered Monday through Friday, 7:00 a.m. to midnight (EST).
AARP is a nonprofit organization for people over the age of 50. The AARP Web site includes information on a number of financial and practical subjects, and you do not have to be an AARP member or over the age of 50 to access these articles. Information on insurance includes articles about different types of insurance policies and links to sites that evaluate the financial stability of insurance companies. You can also use the Web site to request help with finding affordable legal services. Some information on the site is available in Spanish.
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Federal Citizen Information Center
||Send email through the Web site.
||1-888-8 PUEBLO (1-888-878-3256)
The Federal Citizen Information Center offers hundreds of booklets and fact sheets on consumer issues and government services. You can view and print information from the Web site or you can request that information be mailed to you. Some mail order requests will carry a small fee. Topics include money management, saving for retirement, investing, Social Security, Medicare, credit, consumer protection laws and more. Some publications are available in Spanish and other languages.
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Kelley Blue Book
This Web site helps you to find the value of your car if you were to trade it in toward a new car purchase or sell it. This information can help you to know how much auto insurance coverage you need to have. From this site, you can also search for prices of other cars, new or used, and learn more about buying, selling or financing a car.
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LIVESTRONG Navigation Services
Online: Complete an intake form through the LIVESTRONG website.
Phone: 1.855.220.7777 (English and Spanish)
Navigators are available for calls Monday through Friday, 9 a.m. to 5 p.m. (Central Time). Voicemail is available after hours.
LIVESTRONG offers assistance to anyone affected by cancer, including the person diagnosed, loved ones, caregivers and friends. The program provides information about fertility risks and preservation options, treatment choices, health literacy and matching to clinical trials. Emotional support services, peer-to-peer matching and assistance with financial, employment and insurance issues are also available. To provide these services, LIVESTRONG has partnered with several organizations including Imerman Angels, Navigate Cancer Foundation, Patient Advocate Foundation and EmergingMed.
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National Association of Personal Financial Advisors (NAPFA)
The National Association of Personal Financial Advisers (NAPFA) is a professional organization for financial planners. Membership is limited to financial planners who charge customers a set fee rather than those who earn commissions from products that they sell to customers. From their Web site, you can find a fee-only financial planner in your area. The site also includes information about how to choose a financial planner and tips for managing your finances, as well as articles about investing, long-term care and disability insurance policies, retirement planning and more.
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The Professional Association for Chartered Property Casualty Underwriters
||Send email through the Web site.
The Professional Association for Chartered Property Casualty Underwriters is an organization for insurance professionals. The consumer section of the Web site contains information about types of insurance policies, home safety, preparing for a disaster, filing a claim, reducing your premium costs and other insurance topics. You can also search for a licensed insurance agent or broker in your area. A glossary of insurance terms is provided.
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National Flood Insurance Program
||Send email through the Web site.
TTY for deaf and hard of hearing callers: 1-800-427-5993
Operated by the Federal Emergency Management Agency, this Web site provides information about flood insurance. Tools on this site can help you determine your flood risk, estimate how much a policy will cost and find an insurance company or agent in your area. You can also learn more about protecting your property from flooding and emergency procedures to follow in case of a flood. Some information on the site is available in Spanish.
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