When Not to File an Insurance Claim (aka “How to keep your premiums low”)

One of the main reasons for having insurance is to offset risk, especially major risks and losses….. events that will affect your financial wherewithal. We pay insurance premiums throughout our lives for a multitude of different risks. When a possible claim occurs, an initial thought might be “I am finally cashing in on some of those premiums!”

You might want to think twice before filing that claim… Not only do you want to consider strategizing before filing your possible claim, you might want to hold off on even calling your insurance company (ALTHOUGH WE ALWAYS ENCOURAGE YOU TO CALL US – WE ARE YOUR ADVOCATE). If you are a constant “claimer” your premiums will reflect this. So, it all comes down to whether it’s worth it to file a claim in the long run. Take time to consider your options.

DO YOU HAVE A CLUE?

Many insurance companies consider “calls of inquiries” as a claim without your knowledge. Comprehensive Loss Underwriting Exchange (CLUE) is a database that keeps records of all claims. This is not a database you want to land on accidentally by making an inquisitive phone call.

The easiest defense against this problem is to know your coverage and deductible amounts. With the knowledge of what your insurance covers, and the amount (i.e. ring, roof or fender) you can be better armed with the power to make your own decisions and not put yourself in a possible accidental or unworthy claim.

Speaking of deductibles, I believe that carrying a high deductible will likely save you money over the long term. Most insurance can be looked at as a defense for a major event. Not reaching to your insurance to cover minor or lower cost repairs or replacements can be a good defense against higher long term premiums. If you are a claimer with lower deductibles, you are likely to have higher than necessary premiums.

WHEN SHOULD YOU FILE A CLAIM

When there is bodily injury, or a question of bodily injury, the insurance company must be notified right away not only to get your statement, but to mitigate any damages. And, if there is substantial damage to an asset, a claim must be filed. After all, that is what you are purchasing the insurance for! Then, insurance is used for its true intended purpose to protect your assets and protect you against substantial financial loss.

We are here to be your advocate, listen to you, and advise you of your options. We are here for YOU!

– Toni Matous CPCU, CIC (Cell: 206.228.5898, Office: 206.284.4886)

Toni@magnolia-insurance.com

3424 West McGraw Street, Seattle, WA 98199, USA

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How Credit Cards Affect Rental Car Insurance

There are so many waiver claims and insurance policies out there that it can get very overwhelming. To keep it simple, we will examine only two things:

1. The rental car collision damage waiver (CDW), also known as the loss damage waiver (LDW) — this you have the option to fill out when renting a car.

2. Credit cards: Visa, MasterCard, Discover, Escape, Chase Sapphire Preferred, United Mileage Plus Explorer, American Express

The LDW is the form that many rental car companies urge you to fill out in case an accident occurs, since it covers physical damage to the vehicle, loss of use, and diminished value. Read the quoted text below from one of our previous blogs to learn more about the LDW:

*””SHOULD YOU PURCHASE THE LOSS DAMAGE WAIVER (LDW)?

It’s always a cost/benefit decision, but my suggestion is typically “YES” pay for the Loss Damage Waiver (LDW). When you sign a car rental agreement, you are willing to pay for:

1. Physical damage to the vehicle (i.e. collision, theft, hit and run)

2. Loss of Use – time that the vehicle is out of service to repair the damage

3. Diminished value – decrease in the value of the vehicle due to the damage the vehicle has incurred.

If you have comprehensive and collision coverage on your auto policy, it will extend to a rental vehicle with the same coverage and deductible that you purchased on your auto policy. It will NOT cover LOSS OF USE AND DIMINISHED VALUE. Without the LDW, you would be responsible for your deductible, loss of use and diminished value  of the rental vehicle and that can mean thousands of dollars and a lot of time and disruption on your part. “”*

To gain more insight on this topic, go to: https://magnoliainsuranceblogs.wordpress.com/2015/06/26/does-my-auto-policy-cover-a-rental-car/

And now, you are all wondering, “How does my credit card affect rental car insurance?” The answer is, it depends on the type of credit card you own.

Visa: Most visa cards cover theft, damage to the rental car, towing and loss-of-use charges for customers who do not have a personal auto insurance policy. If you have a Visa credit card and do not own a personal auto insurance policy, you do not need to fill out a LDW. Visa however does not cover injury, property damage and damage to other vehicles. For those with auto insurance, Visa will reimburse the deductible as well as some other charges not covered by the insurer.

MasterCard: Also excludes coverage of injury, property damage and damage to other vehicles. Its insurance coverage varies by the issuing bank.

Discover: Offers primary coverage (means that renters are covered even if they have their own car insurance).

Escape: Offers primary coverage

Chase Sapphire Preferred: Offers primary coverage

United Mileage Plus Explorer: Offers primary coverage

American Express: Card holders have opportunity to pay one-time fee per rental of $16 to C$25 to change their coverage from secondary to primary coverage.

NOTE(s): Many credit card companies require renters to refuse the CDW offered at rental car counter.

  • Also, typically, only physical damage to the rental vehicle due to a collision or theft is covered, but injuries to you/others is not – these injuries are covered by those with auto insurance policy; those without auto insurance should look into getting the rental car company’s personal injury coverage and/or a non-owner liability policy offered at most insurance companies.
  • Loss of personal items/assets is usually excluded.
  • Credit cards do not provide coverage in Australia, Ireland, Israel, Italy, New Zealand, and Jamaica. Keep these countries in mind if you ever travel to them..
  • When paying for the rental car and its appropriate insurance coverage and waivers, the entire transaction must be in the name of one cardholder. Just like personal insurance, rental cars are no different- one must take individual responsibility for the entire vehicle.

Source: http://www.insurancejournal.com/news/national/2015/07/07/374253.htm

We understand how all this insurance language can get very confusing for the reader, so if you need any clarification or have questions, please let us know.

Sincerely,

Magnolia Insurance

magnoliainsurance@comcast.net | (206) 284-4886

3424 W. McGraw St.

Seattle, WA 98199

Does My Auto Policy Cover a Rental Car?

Have you been standing at a car rental desk when the clerk asks you “would you like to add insurance to your rental car today?” And, you wonder… “Does my auto policy cover the rental? Does the credit card that I am using to pay for the car cover it or should I buy the rental company’s insurance?”

Your auto insurance policy will typically protect you in a substitute vehicle (or a rental car) “to a certain extent”. For instance, if you have a $500 deductible on comprehensive and collision coverage, the rental car would be covered with the same deductible. BE AWARE that your personal auto policy does not cover vehicles over a certain size (some U-Hauls, trucks, etc.) your travel outside the United States, or drivers not listed on your policy.

SHOULD YOU PURCHASE THE LOSS DAMAGE WAIVER (LDW)?

It’s always a cost/benefit decision, but my suggestion is typically “YES” pay for the Loss Damage Waiver (LDW). When you sign a car rental agreement, you are willing to pay for:

1. Physical damage to the vehicle (i.e. collision, theft, hit and run)

2. Loss of Use – time that the vehicle is out of service to repair the damage

3. Diminished value – decrease in the value of the vehicle due to the damage the vehicle has incurred.

If you have comprehensive and collision coverage on your auto policy, it will extend to a rental vehicle with the same coverage and deductible that you purchased on your auto policy. It will NOT cover LOSS OF USE AND DIMINISHED VALUE. Without the LDW, you would be responsible for your deductible, loss of use and diminished value  of the rental vehicle and that can mean thousands of dollars and a lot of time and disruption on your part.

For car sharing and peer to peer car rental services, the coverage is not standardized. It is important to go to the company website and read the insurance coverage information carefully. If you have any questions at all, call the customer service number.

Most importantly, please call any of us at Magnolia Insurance Agency if you have any questions before you rent a vehicle. Your assets are on the line, and we are here to help you protect them properly!

– Toni Matous CPCU, CIC (Cell: 206.228.5898, Office: 206.284.4886)

Toni@magnolia-insurance.com

3424 West McGraw Street, Seattle, WA 98199, USA

Ouch!!! I Just Received a Traffic Ticket

You see the red flashing lights, look in the rear view mirror and realize it is YOUR car that is in question.

OH _____!

Since traffic tickets are one of the factors with the greatest impact on insurance premium, especially for young drivers, I want to share some information that I learned from a traffic attorney. This information will help you understand your options so that you can keep your insurance coverage high and your premium low.

When you receive a traffic ticket in the State of Washington, there are three options on the ticket from which to choose: PAY, MITIGATE, or CONTEST.

PAYING the ticket means that you admit to the alleged violation and you would like to pay the fine. It is an easy solution, however, the cost of you increased insurance premium for a minimum of three years can be much greater than the fine itself. That’s when mitigation may be a better option.

MITIGATING the ticket means that you admit to the alleged violation, but you would like to explain the circumstances in an effort to reduce the amount of the fine. In the State of Washington, you may even chose to DEFER your ticket once every seven years if it is considered a minor infraction.

CONTESTING the ticket means that you do not admit to the alleged violation and you want to fight the traffic ticket. You can contest a traffic ticket without an attorney, however, your chances of winning decrease dramatically. Traffic tickets are dismissed or found not committed due to a combination of knowledge of the particular court, and knowing the right arguments to make in front of a particular judge.

Pay, Mitigate, or Contest. Know the options and chose the solution that works best for you!

Thank you for the referrals! I truly enjoy working with your friends, associates, and relatives. Remember, we have Starbucks cards, iTunes cards, and car washes for each referral!

-Toni Matuos CPCU, CIC (Cell: 206.228.5898, Office: 206.284.4886)

Toni@magnolia-insurance.com