How many of you have ever had to file a claim with your personal automobile insurance agency? I’m willing to bet that only about half of you have had the wonderful opportunity to experience the claim process. Most of the customers that come into the office after an accident do not know the steps they need to take in order to file a claim.

The most important thing to do before you ever even get into an accident is… make sure you have insurance, and that that insurance is up to date. The easiest way to make sure that your coverage doesn’t lapse is to set up automatic payments through your agency from your checking account. I know that sometimes life happens and stuff comes up and paying your insurance bill isn’t always at the front of your mind, let me give you an example.

One day a woman came into the office to report an accident. She had just recently lost her niece and had let her daughter borrow her car to help make preparations for the funeral. While her daughter was driving the car, she got hit by another vehicle that ran a red light. With everything that had been going on in her life lately, she had neglected to pay her monthly insurance bill. As a result, we were unable to file a claim and get her car repaired. Now, if she had been set up on EFT (automatic monthly bank drafts) she would have been covered. Being on EFT also would have given her a monthly discount on her premium.

That being said, if you know that you have coverage and that your insurance policy is up to date, the next thing you need to do is file a police report. Do not leave the scene of the accident (unless of course you need medical attention), call the police, and let them write up the report. It will take anywhere from 5-7 days to get a copy of the report for yourself. In the mean time, call your insurance carrier and let them know what happened. Their number can be found on the insurance ID card that you keep in your vehicle. Once you get your copy of the police report, send a copy of it to your insurance provider. Depending on the company, your claim should be closed in anywhere from 7-14 days from the day that they get the police report. No matter what kind of accident that you get into, or what kind of damage is done to your vehicle, a police report is the one thing you need in order to ensure that your vehicle will get repaired. Without it, insurance companies will not pay for the repairs on your damaged vehicle.

I hope that I have helped you understand the steps that you need to take to make the claim process as painless as possible.

What Is an Insurance Score?

Insurance ScoreWhat is an insurance score?  An insurance score is similar to your credit score in that it is based on your credit history.  It is used by insurance companies to predict the potential for future losses, much like a credit score is used by financial institutions to predict your repayment.  Today nearly all insurance companies use your insurance score, along with a number of other factors like age, gender, marital status, zip code, etcetera to determine your rate.  Generally speaking, people who have high (good) insurance scores receive lower insurance rates.  Insurance companies can use insurance scores so that more people can get better rates. 

An insurance score is composed of the following:  payment history; bankruptcy, foreclosures and collection activity; length of credit history, amount of outstanding debt in relation to credit limits; types of credit in use (i.e. mortgages, installment loans); number of new applications for credit. 

I have included ten tips to help you improve your insurance score. 

  1.  Pay your bills on time.  Timeliness in paying your bills improves your score.
  2. Manage your outstanding balances.  As a rule of thumb, maintain account balances at least seventy-five percent below your available credit.
  3. Avoid excessive inquiries to your credit reports.  Too many inquiries may negatively impact your score.
  4. Limit the number of credit accounts.  Your access to excessive unused credit could result in too much debt.
  5. Review your credit report regularly.  Know what is on your credit report, and take necessary steps to dispute any inaccuracies.
  6. Avoid ‘quick’ credit fixes.  Good credit is built over time.
  7. Manage your debt consolidation.  Consider how to effectively pay down your debt without generating more credit activity.
  8. Limit the amount of new debt you take on.  Too many new loans or credit accounts opened in a short amount of time can negatively effect your credit rating.
  9. Establish credit if you do not have a long track record.  A longer credit history has a positive impact on your score.
  10. Work with your creditors.  Resolve outstanding balances before they are turned over to a debt collector

Valentine’s Day: Say I Love You With Insurance

  • New Mexico Homeowner's InsuranceDeluxe Godiva Towering Box of Chocolates:  $49.95
  • Romance bouquet with red roses:  $79.95
  • Forever love diamond knot pendant:  $1,199.00
  • I love you:  Priceless.

Yes, the love that we receive from those that are closest to us really is priceless; however, the gifts that we give to them do have a monetary value.  The National Retail Federation estimates that the total sales of Jewelry and watches will exceed four billion dollars this year, that’s a seven percent increase or last year. 

Now, I don’t know of anybody that will mention the word “insurance” as they look into their lover’s eyes and hand over some treasured item that they hope will somehow express what words can’t say.  However, if an expensive gift is stolen or lost one of the first things that many people think about is insurance.  Insurance can certainly make the loss of an expensive item a little easier to take, at least from a financial standpoint. 

Most homeowners polices, whether they be renter’s policies or homeowner’s policies, include coverage for jewelry and other expensive items; however, the coverage is usually limited to between one thousand and two thousand dollars.  Make sure that your jewelry is properly insured:  purchase an endorsement to your homeowner’s policy; these are also referred to as floaters.  There are even a few companies that offer very broad coverage for personal items as a standalone policy.  Generally these policies are not expensive and offer the broadest coverage available. 

Yes, I know that insurance is not a “romantic” topic, but it is an expression of two things:  concern and responsibility.  Those two feelings really are an expression of what love is:  concern for one’s welfare and taking responsibility – insofar as you are able – for it.  Now, I’m not going to go so far as to say that you should give your loved one and insurance policy for Valentine’s Day, I do want you to still have a loved one at the end of the evening, but perhaps the most loving and least romantic thing you can do is to make sure that everything is properly insured, so that your loved ones financial needs are taken care of at the most inconvenient and stressful times in their lives.     

As always talk to your insurance agent to see what coverage and premiums are available so that you can make the very best choice.

On the Eleveth Day of Christmas – Musical Instruments Coverage

New Mexico homeowners insurance“On the eleventh day of Christmas my true love gave to me eleven pipers piping, ten lords a leaping, nine ladies dancing, eight maids a milking, seven swans a swimming, six geese a laying, five gold rings, four collie birds, three French hens, two turtle doves, and a partridge in a pear tree.”
All these musical instruments around sure aren’t cheap. I don’t know anybody today who plays a pipe, but there sure are a lot of people who play trumpets, horns, flutes, guitars, and similar instruments. The standard homeowner’s policy does provide coverage for most of these items, but not all of them.
Coverage for musical instruments in found in coverage C – Personal Property. It provides named perils coverage for all property belonging to residents of the premises up to the limit specified on the declarations page. However, this limit is further reduced for some items including:
• Money, coins, or precious metals – limited to two hundred dollars.
• Securities, manuscripts and other valuable property – limited to two hundred dollars.
• Watercraft, including trailers and equipment – limited to one thousand dollars..
• Trailers – limited to one thousand dollars.
• Musical instruments – limited to one thousand dollars.
• Jewelry, watches, furs and semi-precious stones – limited to one thousand dollars.
• Firearms – limited to one thousand dollars.
• Silverware, gold ware, or pewter ware – limited to two thousand five hundred dollars.
• Property used for business purposes – not covered.
As you can see all these pipes are only covered up to one thousand dollars. Now, most people don’t have ten musical instruments, but rather one or two. If these musical instruments fall within the one thousand dollar limit then you are fine. For example, you could own a guitar that was valued at five hundred dollars and a trumpet that was valued at three hundred fifty dollars and still fall well within the thousand dollar limit.
There are some musical instruments that are much more valuable than one thousand dollars. Any high end instrument be it a trumpet, or guitar, or a violin will probably have a value in excess of one thousand dollars. If you fall into this category make sure you have a conversation with your insurance. Being property insurance and protected is important.

On the Tenth Day of Christmas I Was Thankful for Medical Payment to Others Coverage

“On the tenth day of Christmas my true love gave to me ten lords a leaping, nine ladies dancing, eight maids a milking, seven swans a swimming, six geese a laying, five gold rings, four collie birds, three French hens, two turtle doves, and a partridge in a pear tree.”

Wow, ten lords a leaping! It looks like we have a party.  Ten lords and nine ladies, and I’m sure nobody’s sober.  I sure hope that nobody is fixing to get hurt.

Now, I’m a responsible homeowner and I maintain my home in good repair, I also keep hazardous materials and items out of the reach of children and do my best to make sure that nobody gets hurt on my property.  The last thing that anybody wants is to hurt somebody, but sometimes things happen.  These things may or may not be our fault, but they do happen.

The problem is that when accidents happen it is all too common to have lawyers involved and they suddenly want to blame the homeowner for the accident.  This will generally end up as a liability claim under your homeowner’s insurance policy.  It will cost the insurance company lots of money to defend, even if the homeowner is completely innocent and the case is won.

In an effort to keep the guests from running to their nearest attorney the insurance companies came up with a coverage that will help the homeowner provide for the medical needs of the guest.  It is called Medical Payments To Others coverage.  It is part of the liability coverage package under the standard homeowner’s insurance policy.

Medical Payments coverage does not provide for medical payment to the homeowner or any household residents.  It provides for payment of medical expenses incurred by the guests of the homeowner while on the property.

As an example, let’s say that our ten lords a leaping just happen to fall over and hurt themselves while frolicking about.  If someone wants to frolic and caper about they are bound to have an accident sooner or later.  It doesn’t necessarily make the homeowner at fault for their clumsiness, but some sympathy and kindness on his part will certainly help the “lord” to feel better about the situation.  It’s also possible that he might even realize that his injury was his fault. 

Medical payments coverage is designed to avoid the lawsuit.  It is much cheaper and usually much better policy, to be kind and generous to others.  If you believe in Karma then you’ll probably agree.