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Frequently Asked Questions
Auto Insurance | Homeowners Insurance | Business
Insurance | Student/Recent Graduate Insurance
Florida Homeowners Insurance Q&A [ PDF
Document ]
Why do I need to buy insurance?
- Protects your assets against attachment
as a result of a court award.
- Provides for cost of defense when you
are sued.
- Allows you to purchase such high value
items as a car or a home by insuring the
collateral on behalf of the financial
institution that lent you the money.
- Provides financial security for your
family in the event of your death.
- Provides for the health care of you and
your family through systematic payments.
- Allows you to save for retirement while
deferring interest payments to a time when
your income is lower, thus reducing your tax
payments.
- Allows you to remain financially solvent
when you're ill and can't work.
What factors affect the insurance premiums
I pay?
• Claims activity including such costs as
medical care, auto body repair, construction,
legal defense, jury awards, claims adjustment,
and insurance fraud.
• Overhead including rent, utilities, employee
salaries and benefits, office supplies,
equipment, and furniture.
• Investment income.
AUTO INSURANCE
How does where I live affect my premium?
 Where
you keep your car directly affects your chances
of having an accident or becoming a victim of
theft or vandalism. The likelihood of
encountering these problems increases in larger,
more densely populated cities, while such
incidents remain relatively low in rural areas.
Additionally, the time and efficiency of
police response and law enforcement, local road
and traffic conditions, and the quality of local
medical services can affect regional insurance
rates. Some insurers even factor in the
litigation rates in a given area (how many
lawsuits are filed, go to trial, out of court
settlements, and their amounts).
Do all states require some kind of
Liability insurance?
No. Although not every state requires Auto
insurance, some have financial responsibility
laws mandating all drivers to be able to pay for
any damage or injury they might cause. However,
Liability insurance is still the best way for
you to meet your state's financial
responsibility requirements.
By law, all states offer UM and UIM policies,
including no-fault states. In fact, some states
require all motorists to carry this coverage in
order to gain protection from inadequate
insurance coverage of other drivers.
How do I keep my insurance company from
canceling my policy?
Besides maintaining a clean driving record,
consider investing in special safety and
security features for your car. If you've been
in an accident, consider taking a defensive
driving course.
What happens when I loan my car to someone?
Is that person covered by my policy? Am I still
covered?
Yes. Liability and coverage for Physical Damage
(i.e. Comprehensive and Collision) always follow
your car. Plus, if the driver of your car is
insured, his/her policy will also be available
to cover the cost of damages and injuries.
The same rules apply when you borrow someone
else's vehicle; your own insurance follows you
no matter whose car you're driving. But the
vehicle owner's policy is the key coverage in
the event of an accident.
Am I covered for natural disasters or "Acts
of God?
Comprehensive insurance, which covers you for
fire and theft, generally covers you against
damage by flood, earthquake, hail, and other
natural perils, except when your car is
overturned (which is technically considered a
collision). If you have specific concerns about
the safety of your vehicle in natural disasters,
contact us for information on catastrophic
coverage.
How can I challenge my insurers if they
refuse to cover a claim?
Usually, insurers that refuse to cover a claim
have a strong legal reason for doing so even if
you disagree. First, contact us if you feel
you're being treated unfairly. Your agent is
your strongest advocate in insurance matters.
But if it's a legal problem, you might have to
hire a lawyer.
HOMEOWNERS INSURANCE
Who decides on the type of insurance, the
mortgage company or me?
You do. The mortgage company collects a set
amount from you each month in order to protect
their investment. This money is put in escrow
and covers your insurance and taxes. However,
the policy is still yours and you might select
the insurance you feel offers the best coverage
at the best rates.
What exactly does a Homeowners policy cover?
Coverage is impossible to define because there
are different policies and about 900 insurance
companies writing Property/Casualty business in
the United States. However, 80% of Homeowners
policies are based on a standard form. All
Homeowners policies cover two important areas:
Property and Liability.
Property insurance covers your structures and
possessions. Personal Liability, as its name
implies, means you're legally obligated to pay
money to another person for actions caused by
you, your family, or your property. That
liability extends to medical payments to others
for injuries caused by you or your family.
Are floods, earthquakes, and other natural
disasters covered?
Most catastrophes are covered. Flood and
earthquake damage, however, are not covered by a
standard policy and both perils are more common
than many people realize. We can advise you on
such normally excluded conditions as floods and
earthquakes.
Are there exclusions I should know about?
Exclusions listed and defined in your policy
might include neglect, intentional loss, earth
movement, general power failure, and even damage
caused by war. If you fail to take care of your
property (e.g., a leaky roof), you might not be
covered. Obviously, if you intend to lose an
object or damage your property, there's no
coverage.
One other exclusion that can be costly is the
Ordinance or Law exclusion. Building codes
established by governmental bodies that drive up
the cost of rebuilding or repairing after a loss
occurs might not be covered by your insurance
policy. Thus, if you discover when replacing
damaged property that current law demands higher
grade or more expensive materials than those
you're replacing, the new materials might not be
covered fully.
BUSINESS INSURANCE
I'm just getting my business started. Do I
need insurance immediately?
Yes. Your chance of suffering a loss begins with
the first day of business. If you suffer a loss
and have no insurance or have improper or
insufficient coverage, your insurance agent can
do little, if anything, to help you.
Also, many states and local jurisdictions
require businesses to have insurance to begin
operating. And if you rent space for your
business, your landlord probably requires you to
obtain adequate insurance.
I don't have any major business assets. Why
do I need insurance?
Every business has some property. When you think
about it, your business is your property. Just
like your home and your car, your business needs
to be protected from loss, damage, and
liability. In addition, your business is your
source of income, so you need protection from
the potential loss of that income.
Does insurance coverage vary for different
businesses?
It can. Many small businesses opt for package
policies that cover the major Property and
Liability exposures as well as for a loss of
income. A common package policy used by many
small businesses is called the Business Owners
Policy (BOP).
Generally, BOPs provide more complete coverage
at a lower price than separate policies for each
type of insurance needed. We can help you decide
which policy or policies are right for your
business. You can also purchase additional
coverage for perils or conditions otherwise
excluded (e.g., flood protection) as
endorsements to a standard policy or as a
separate, second policy called a Difference in
Conditions (DIC) policy.
We can advise you of the best policy (or
policies) to protect you and your business.
STUDENT/RECENT GRADUATE
INSURANCE
I'm a college student. Am I still covered
by my parents' policies?
It depends on the policy and its terms. For
example, most Health insurance policies cover
insureds' children up to age 18, or up to 22 if
the child continues as a full-time student. If
you are over 18 and not a full-time student,
you'll need your own Health insurance policy.
What kinds of risks do college students face?
College students face many new risks as they
head off to school: theft of personal property,
auto accidents due to driving long distances,
and risks related to attending and giving
parties.
How extensive are these risks?
College and university campuses aren't immune to
property crime. A 1995 FBI study reported that
there were more than 100,000 property crimes on
college nationwide, including burglary, theft,
motor vehicle theft, and arson. Thieves took an
average of $1,251 of property per offense that
same year.
At least one in 10 college students revealed
that they had caused an auto accident in the
last two years. One in four had a speeding
ticket or other moving violation. These and
other offenses contribute to higher Auto
insurance premiums for students.
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