Business News

Sometimes life just is not fair. You think you have done everything absolutely right and then circumstances show you everything is turning out wrong. So it is that you get to see the end of hope played out in court cases. You know it should never come to this but, when it comes to people’s lives, there are few real choices if you feel you want justice. You do your best to be reasonable. You offer to settle. But the other side just fights on. It all comes down to willpower. Whoever is strongest will be left standing. Continue reading →

There are many people out there who still don’t know how insurance providers calculate their rates for insuring their autos. It comes to the point when people ask their insurance agents why their neighbors have lower rates while driving the same car and getting insurance form the same provider? Unfortunately, it’s quite common for insurance industry workers to deal with cases like this, because lack of necessary knowledge makes the customers very suspicious and unfriendly.

To go straight with the question, there are different factors that will impact the rates you will be charged for insuring your auto. One of the most important factors is the age of the policyholder. They say that age doesn’t matter. Well, probably for many other things it really doesn’t matter, however when it comes to insuring your vehicle, age plays a very important role in the overall equation. Below you will find some explanations on why the policyholder’s age plays such an important role and in what way does it influence the final rates.

Fresh drivers behind the wheel

Insurance company statistics tell that younger drivers tend to take risk far more often when behind the wheel than those who have are older and have more experience in driving. The direct consequence of such tendencies is that teen drivers tend to get involved in serious accidents far more often than drivers from other age groups. That is why insurance companies charge young inexperienced drivers with higher rates. However, if the young driver maintains a good record and doesn’t file any claims for a specific period of time, the rates can be reduced significantly. Continue reading →

Tough times for the Commissioner

One of the most important lessons of the last two years is that having regulators in place does not mean having consumer safety. Wherever you look from the failure of the SEC to police the banking industry, to the failure of the FDA to keep food and drugs safe, to the failure of the Minerals Management Service to prevent the oil disaster in the Gulf of Mexico, it’s clear the regulators have been asleep at the wheel of a Toyota car speeding out of control thanks to the National Highway Traffic Safety Administration. It does not matter who you want to blame: the politicians who take the money of business and industry to pay for their expensive election campaigns, the leaders of business and industry who want the maximum profit with no accountability, or the regulators who sit in the middle and hope no one will notice they do nothing. The result has been a catastrophic series of failures. And who gets to pick up the bill? Why taxpayers and consumers, of course. Tax revenues are used to bail out the companies too big to be allowed to fail, and everyone who buys goods and services gets to pay a little more every year in prices to keep the wheels well greased.

Why are we thinking about this right now? Well, every US state has a department or office of insurance run by a Commissioner who is supposed to protect our interests. In some states where the political wind blows more to the left, the Commissioners can be crusaders who protect our interests. But in states where the political wind blows to the right, the lawmakers pass weak regulations and fail to back-up the regulators who might want to “do something”. A classic example of the problem can be seen in Texas where the Commissioner has been fighting a losing battle with the insurance industry in general and State Farm in particular. Continue reading →

Q: Should I carry insurance with my car?

A: Almost all states make it mandatory for the car owner to carry insurance with his vehicle as a proof of financial liability in case there’s damage or injury delivered to third parties while being on the road. Not having sufficient insurance coverage (lower than the state minimum) is illegal and may result in a substantial fine, license suspension and even time in custody. This only applies to the liability portion of your insurance policy, as other types of coverage are strictly optional.

Q: Should I purchase insurance prior buying a new car?

A: In case you’re purchasing your first car, you should definitely buy insurance first, otherwise you won’t be able to drive it from the dealer’s shop. Moreover, if you’re using a car loan to finance the purchase, your loan provider will make it a strict condition to purchase specific insurance in order to get the money you need.

In case you already have a car and want to replace it with a new one, you should inform your insurance provider about that and get new rates for the car make and model you want to purchase. You usually have between 2 to 4 weeks to contact your provider regarding the purchase, depending on the company.

In case you’re purchasing an additional vehicle and want to include it in your current policy, the regulations vary from company to company. Usually, companies require notification within a period of 30 days, after which they will inform you about approval (or non approval). Continue reading →

Insurance companies are known to cost lots of money. They make your face pale just with one thought. But hey, brighten up! It doesn’t have to be a nightmare. It can be pricey but without driving you totally nuts.

We all were born to believe that good things don’t come free when it comes to purchases. We hate to break it but this is not so. You can save pretty much on anything you want nowadays without making yourself to regret this thing. How come? This is only because the market is bombarded with companies that want to compete for people like you. They know the chain reaction works well here. What do we mean by that? Let’s take a look at the following example. You come in without any clue about what you need.

The clearest of it all in such case has to be the price comparison between different companies. You need to do this thing in order to find out your possibilities and options with various insurance providers. With the help of online quotes you can do it easily and hastily. But, remember not to rush such moments. You have been waiting long enough without any insurance plan so it is better to take an extra day or two to sort the situation out.

There are many sites that will give you a list of companies, their best offers and rates. Consumer buying guides that compare premiums from different insurers together will the feedback from different costumers – this is what some independent insurance sites have in store for you.

Keep in mind that every detail counts. When you have chosen the company to trust, it is important to fill in the application the right way. We would like to advice you not to lie in your application. Lies are always punished in the end. Fill it in frankly, without making it seem too good or too bad. When you fill in the line about your expectations – please let the company know that you would like to take advantage of any discounts that you are eligible to and let them think you are interested in the decrease of your payments. If you are a part of a certain group of people – for example veteran or a teacher, if you are a student as well, be aware of discounts coming your way as very often these categories and people that are a part of those have a right to a discount.

If there is a possibility for you to pay your whole premium in one go, please do so. But know that most carriers charge some additional money for those of us who pay on installments. Don’t let something go wrong with your payments. It is important to be updated with what you have to do at the right time before the situation gets out of control.

If you are the owner of an ordinary car, these advices were suitable for you. If you are about to get yourself a brand new car, take into consideration the fact that expensive cars demand high premiums. Simply make sure everything is the way you can afford it to be. Continue reading →

This is one of the more difficult questions to answer. If you were to ask an insurance agent, the answer would obviously be the largest number he or she thought could be mentioned without you fainting away. For anyone earning commission on a sale, the biggest sale is always the first suggested. So how should you approach your own answer? Well, this is as scientific as crystal ball gazing. You are trying to guess what is going to happen to the amount of your current debts, the actual needs of your dependents over time, and value of money as inflation takes it toll. Since we all hope to live until we are at least seventy, this can be projecting today’s values into complete unknowns. Just think how much society has changed over the last fifty years – $100 in 1960 was worth approximately $734 in today’s money, i.e. there has been inflation of about 4%. In international terms, an inflation rate of only 4% is remarkably low. Other countries have experienced significantly higher rises in prices and pay. So if you are going to project today’s value over the next 50 years, you have to decide whether this rate is going to remain stable. Being optimistic by nature, you probably decide to continue the current rate. Now you need to value your current debts.

The best approach is to do a simple set of accounts. List all your current borrowings by way of mortgage, bank overdraft, credit cards, and so on. Hopefully, because of the recession and the credit crunch, you have been paying down some of these debts. Now look at the positive side. Although your housing equity may have disappeared for the next five to ten years, you may have investments and savings. Do not forget your 401k account and any other places where value may be stored. This should give you a net figure of debt. How do you see this number changing? Are you going to be virtuous and continue to pay down the debts, or will some expenditure be unavoidable, e.g. paying your children through college, preparing for your own retirement, etc.? Be as honest as you dare and make whatever estimates seem reasonable. All this money will have to be found, i.e. your pay will drive all this spending. So do a quick calculation and see whether you can pay for all this new debt out of your existing pay or will your debts increase? Now think about insurance as a worst case scenario. You have all this debt. It costs this much to run your household. The expenses at life’s end will be. Continue reading →

In all the insurance markets, there is one underlying truth. The insurance companies are for profit and they will always act in their own best interests and not yours. For planning purposes, you should always assume there are better ways of doing things than the ways suggested by your own insurer. Let us take the question of the cash value in permanent life policies. All these policies have a value. If you approach your insurer and ask how this value can be realized during your lifetime, two answers are given. The first is the option to surrender the policy. This is an early termination of the policy. Thus, the insurer is no longer obliged to pay the sums estimated or guaranteed at the end of your life, but pays you a proportion of those benefits based on the amount you have paid in. The second option is a loan. This can either be a loan of some or all of the cash value, or it can be a free-standing loan with the cash value account used as collateral. Obviously, loans come with interest obligations attached. Borrowing your own cash value attracts a lower rate. Free-standing loans have higher rates. What, if anything, is wrong with these options?

The insurer will calculate the surrender value by counting how much you have paid in premium instalments, deducting any commission, management fees or expenses, and adding a sum of interest. You therefore receive more than you paid in but significantly less than would be paid out if you kept the policy in being. As to the loans, unless you repay the loans in a timely fashion, the interest eats away at the remaining value of the policy. It is not unusual for people who take a loan to find all the value in their policy wiped out by the interest. Obviously, this defeats the purpose in keeping the policy in being because your dependents will get little or nothing when you have gone. Continue reading →

According to the Insurance Institute for Highway Safety, if you collect one speeding ticket, there’s a significant rise in the probability you will be involved in an accident in the next three years. This is not opinion. It’s a statistical fact that the chances of an accident rise by 50%. If you have two speeding tickets, the chances of an accident double. Since insurance companies set their premium rates according to these risk assessments, there’s an automatic linkage between a traffic citation and your premium rate. Depending on who you are, the rate can rise just a little or triple. For example, a wife rushing to her husband’s hospital bedside will be penalized less than a young man out street racing. The reality of the insurance market is that, according to the statistics, you get the premium rate you deserve. Since this is going to make the difference between potential discounts for being a safe driver with no claims and no tickets, and rate hikes worth several thousand dollars over the next three or four years for picking up a ticket, it can be worth fighting traffic tickets.

Obviously, it’s better to drive safely and within the law. It’s just as important to protect your reputation. Every few years, spend a few bucks at your state’s Department of Motor Vehicles (DMV) to ensure your driving record is accurate. If there’s a mistake, have it corrected. This could save you big dollars on the premium rates overnight. Now, let’s face the worst. You get pulled over. Remember never to admit guilt to the officer. Just be polite. Upsetting the officer could result in the addition of “ND” to the citation. That’s a note to the prosecutor not to do a deal, but to push for the maximum penalty. OK, so now you are in the system. What should you do? Don’t ignore the ticket. In many states, the police issue an arrest warrant. The first step is talking to your local DMV. Many states have programs in place to help drivers. For example, some will defer judgment and, if there are no violations in the next six months, the ticket is dismissed. Other states have driver safety courses. For minor offenses, attending a course on driving wipes the conviction from your record. You still have to pay the fine and the tuition fees, but this is less than the premium rate increases. Continue reading →

The insurance companies will always reward you for driving less. If you rarely put wheels on the road, the chances of a claim are small and all your premium will be “profit to the insurer. So how does this work? In theory, it could not be more simple. The insurance company looks at who you are, when you drive and where you drive in deciding how much of a risk you represent. If you live 50 miles from your work and have a daily commute along a busy Interstate, the chances of an accident are high. But if you live on a bus route to work and only use your vehicle for odd journeys at off-peak times, the chances of an accident are small. When you answer the questionnaire, you will see questions covering these possibilities. Remember, if you get caught out in dishonest answers, the insurer will cancel your policy and leave you without any coverage.

The first question is where you live. Although some states like California have outlawed setting rates according to your zip code, the majority of companies focus on your home address. If there’s a high accident or theft rate among people living in your area, you will all pay a higher premium. The only choice, if you can afford it, is to live some place where the crime and accidents rates are lower. You look for the middle ground between the worst inner city crime hot spot and a house on the prairie where you never see another vehicle from one day’s end to the next. All the discounts favor drivers who only drive off-peak during the day, and restrict their annual mileage. No more late night and early morning driving when the majority of other drivers may be tired or affected by alcohol and/or drugs. This raises the question of monitoring. It’s easy to answer the questionnaire and claim the maximum discounts. But the trend among insurers is to ask people to drop their vehicle in for a regular inspection of the recorded mileage. The maximum discounts are given to the drivers who agree to devices being installed which collect all the data on driving and transmit it to the insurers. These devices have a GPS element that records where you drive, the time and, in some cases, some measurement of the quality of your driving, e.g. how often you brake. The reward for accepting this invasion of your privacy can be discounts of up to 25% on top of the usual discounts. Obviously, it’s not a good idea to use your own vehicle to rob a bank since the insurance company will know you were there. Continue reading →

With Alice back in Wonderland thanks to Tim Burton, we continue this series of articles on how to earn discounts when insuring your vehicle. This time, the trip down the rabbit hole (or through the looking glass as you prefer), deals with the practicality of your use of private transport. Remember the insurance companies want as little risk as possible so they prefer you to have the vehicle parked on your front yard where you admire it from a distance and, when it gets dusty, wash and polish it. In short, the less you drive, the more you save. So lets see how it works. There are three times during the day when accidents are more likely. These are the two main periods for commuting to and from work, and the late night and early morning when driving is often associated with alcohol and other “substances”. The statistics show the more vehicles there are on the road around you, the greater the chance one will collide with another. At peak times for commuters, the roads are suddenly full and the risks of accidents are high. Now change the weather from sunshine and gentle breezes to the first ice and snow of the winter. The majority of drivers have forgotten the risks, made no advance preparations and find themselves on a skating rink without any way of stopping in a hurry. The accident rate goes sky high until people relearn their winter driving skills. At night, its the reverse problem. From 11 p.m. through to the early hours, there are fewer vehicles on the road, but the majority of drivers may be less alert. At best, this is simple tiredness. At worst, its substance abuse and you are in the way.

So, if you agree not to drive at the most dangerous times, you get a discount. For the same reason, agreeing to restrict your mileage also earns a discount. If you only drive a few miles every now and again, the chances of you being involved in an accident are small. The lower the mileage you accept, the better the discount. For the same reasoning, where you drive affects the premium. Although the practice is outlawed in some states, your zip code sets the tone for the premium rate. Some areas of the cities and larger towns are statistically more accident-prone. Equally, if you live in a wilderness area or in a remote part of the prairies, you can go miles without ever seeing another vehicle. Collisions are therefore rare, although some trees are known to throw caution to the wind when crossing the road. Be honest with yourself. Do you have to use the vehicle? Yes, it may be slightly inconvenient to use public transport but, if you are saving money on your insurance, you can be safer and better off financially. Continue reading →