After an individual dies, the executor of his estate must handle many items until the estate is distributed. One issue that often comes up is what to do with the homeowners insurance while the house is in probate. Most insurance companies do not like the house to be left vacant for an extended period of time.
- The executor basically handles everything in regard to the individual’s estate until it is finalized. During this period, the executor may need to call the homeowners insurance company and change the name of the policy over to the estate. The executor may also need to add his own name to the homeowner’s insurance policy during this process.
Insurance Company Grace Period
- Most insurance companies do not like to leave houses vacant for extended periods of time. This tends to lead to vandalism, theft and other losses that the insurance company could be responsible for. Because of this, the insurance company may be reluctant to allow the home to stay vacant. In most cases, the insurance company will provide a grace period of 60 days to 90 days in which the house can sit vacant before the policy is dropped.
Transition to New Owner
- Typically, when an individual dies, all of his assets are distributed to his beneficiaries by the executor. The homeowner has the opportunity to pass the house on to a loved one. Once this happens, the beneficiary will then have to take out a homeowners insurance policy on the house. Because of this, the house typically does not have to remain unoccupied for very long. Even if the beneficiary plans on selling the house, he will need to take out a policy under his own name.
- When a homeowner passes away, you may want to check with his homeowners insurance company about coverage riders. In some cases, the homeowner may have a type of mortgage life insurance attached to the policy. With this type of coverage, the insurance company will pay the mortgage when the homeowner dies. This takes the burden of the mortgage off of the family members and basically provides them with a paid-off house to use.
- A car insurance policy will cover damages to another person’s property and physical injuries, if either or both were caused by the insured driver. Some policies will also pay for repairs to the insured driver’s vehicle, whether he caused them or something or someone else, such as an uninsured driver or a hailstorm, caused them. A young male driver should determine what type and how much insurance he will need. He should then shop around with several agencies to find the best deal.
- Comprehensive car insurance is the most inclusive type. That also makes it the most expensive. If you are trying to save money, you should probably look at other types, unless you are financing your car. If so, full coverage will be required. Fire and theft insurance covers less than comprehensive. It will pay you if your car is stolen or damaged by fire, though. This type costs less than full coverage, but third-party insurance is the most affordable. This basic type of insurance covers only damage caused by the insured party to another vehicle or person.
- A clean driving record equals a lower insurance premium. Strive to keep yours free of speeding tickets and other citations. If you do receive a ticket, find out if you have the option of taking a defensive driving course to avoid having points added to your license. More points mean a higher payment. In addition, if you are currently a student, the higher your grade average is, the lower your premium might be. Ask insurance companies how these qualities will get you cheaper insurance.
- Choosing the right car will also help you get the cheapest insurance. As a rule, the less expensive a car is, the cheaper the insurance will be. Domestic vehicles usually help you garner a lower rate, as do slower ones. Six cylinders cost less to cover than eight, and four cylinders will be cheaper than six. Forget about a hot sports car or sporty SUV. If your goal is affordable insurance, a four-door or minivan will be your best bet.
- When shopping around for car insurance, ask questions. Find out about every discount available to see if you qualify for any. By limiting the amount of driving you do, you can substantially lower your rates. Finally, set a higher deductible. You will pay more out of pocket if you are involved in an accident, but you will pay less up front. Besides, by continuing to drive safely in your sensible car, your likelihood of having any accidents will greatly decrease!
- Insurance provides people and companies with protection against major financial losses due to damage or loss of property. In exchange for a periodic payment or premium, individuals and companies are guaranteed to be compensated or reimbursed under the terms of the insurance policy. Insurance is a part of daily life. Car insurance and homeowner’s insurance are two of the most common forms of insurance. Health insurance and workmen’s compensation are also well-known types of insurance. While insurance is a part of most people’s lives, not everyone understands how it works.
How Insurance Works
- There are always risks in life such as fire, theft or earthquake. Many people hope to avoid the financial consequences of replacing personal property that is lost or damaged. Insurance is a way to protect your personal finances from undue burdens. Insurance is really a form of risk management in which the risk is transferred to the insurance company in exchange for payments or premiums. When a person purchases insurance, he gets an insurance policy which is a legally binding contract. This policy describes in detail all the rights, responsibilities and obligations of both the insured and the insurance company. If a person suffers losses covered in the policy, he files a claim. A claim is a detailed account of what is lost or damaged and its value. The amount of money a person is reimbursed is based on the amount of the policy. If the policy is for $5,000 that is the maximum amount the insured person can get.
When individuals or companies purchase insurance policies, all the money from the premium is combined into what is called the insurance pool. Insurance companies use statistics to predict what percentage of insured people or businesses will actually suffer a loss and file a claim. The statistics also help to determine the amount of the premium. Other factors such as credit scores and previous claims are also taken into consideration. Because the vast majority of insured people do not suffer losses or only small losses, the insurance companies make a huge profit which enables them to pay out the occasional huge claim.
Types of Insurance Available
- There seem to be insurance policies available for any situation. Anything that has a potential risk of loss or damage can be insured. One policy can cover several areas of risk such as a homeowner’s policy dealing with fire, theft and liability. Some of the more common kinds of insurance are renter’s, life, disability, liability, travel and pet insurance. Companies have political risk insurance if they do business in politically unstable countries. Crime insurance protects against theft or embezzlement. Property insurance protects against loss of boats, planes, and farm crops. Boiler insurance is for machinery and equipment. Credit insurance provides protection for loans if the borrower should die, becomes disabled or lose his job. There is insurance to protect against natural disasters such as flood, windstorm, earthquake and volcano. Nuclear accident insurance is also available as is kidnap and ransom insurance and terrorism insurance. In considering any of these types of insurance you have to assess your situation and determine what is best for you, your family and your business.
Coverage for Your Home
- Your home is probably the biggest investment you will ever make. Be sure your homeowner’s insurance covers it in its entirety. Homeowner’s insurance does not cover flood or earthquake damage. If you live in a high-risk area, consider purchasing separate insurance. A typical homeowner’s policy, which is based on a form HO-3, will protect from damage from fire, hail, explosion, riot, aircraft, vehicles, smoke, falling objects, snow, sleet, wind and theft. Make sure to purchase a guaranteed replacement cost policy, which offers more protection for your assets and home than an actual cash value policy. For example, if your home is destroyed and your policy is for $100,000 but your home costs $125,000 to rebuild, without the guaranteed replacement coverage you would be required to pay the additional $25,000.
Coverage for Your Assets
- Homeowner’s insurance also covers your personal belongings. In a typical policy, the insurance company may allow up to 40 percent of the total policy to account for your personal assets. There may be a max amount, such as $2,000, of what the insurance company will pay per item. Make sure you have adequate protection for high dollar items, such as collectibles, electronics, jewelry, fur coats or expensive clothing. The insurance company may require an appraisal. Take pictures or videos of your home and keep records of your home inventory. Your policy may also cover landscaping. If the amount of your assets decreases over time, be sure to adjust your policy so you aren’t paying more for items that have lost their value.
- A standard homeowner’s insurance policy may include about $100,000 in liability insurance. Liability protects you and your family in the event that your neighbor hurts herself in your home, or your dog destroys your neighbor’s yard. Owning pets, a swimming pool or a home-based business may put you at a higher risk for lawsuits. Consider purchasing more liability.
Reducing Your Premium
- Homes located near a fire hydrant or fire station may nab better insurance rates. In addition, having a smoke alarm, security system, fire retardant roofing and deadbolt locks in your home may further reduce your premium. Increasing your deductible from $500 to $1,000 will lower your premium. You may be able to further reduce your premium by purchasing your auto and homeowners insurance policy from one company.
- An exclusion is a provision in your insurance policy that eliminates coverage for a specific individual or for certain risks. An insurance company has the right to exclude any driver that does not meet the company’s underwriting guidelines. On the other hand, you have the right to request that the insurance company exclude certain drivers from coverage, such as teen drivers, roommates or your spouse.
- You may exclude a spouse from your auto insurance if you do not want him covered or your policy, Your insurance company may also require that you exclude your spouse for underwriting reasons. Your insurance company require an exclusion if your does not meet underwriting criteria related to driving and claims history. The company does this if they have no rating criteria for your spouse’s record. Rather than not charging enough premium or canceling the entire policy, the company will exclude your spouse from the policy. If your spouse does not have a valid driver’s license or has a disability or illness and cannot drive, he will be excluded from the policy.
Advantages and Drawbacks
- Excluding your spouse may have some advantages. For instance, if your spouse has a bad driving record that would cause your insurance premium to dramatically increase, it may be less expensive to exclude your spouse from your policy and allow him to obtain his own policy.
A drawback to excluding your spouse is the fact that he will not have coverage while driving your car. If your spouse will drive your car even once, he should be included on your policy to avoid legal complications if an accident occurs. If you are excluding your spouse for reasons other than driving record, it may cause your premium to increase with some insurance companies. Many companies offer discounts to couples if both partners are insured on the same policy.
- Both you and your spouse can be in legal trouble if your excluded spouse is involved in an accident while operating the vehicle. The insurance company will not cover property damage or medical expenses that result from the accident. If your spouse is liable for the accident, she responsible for paying all expenses including court costs and monetary awards that result from a lawsuit. Further, your insurance company may accuse you of misrepresentation or fraud for not including your spouse on the policy although your spouse has regular access to and drives your vehicle.
Benefits of Overlap Car Insurance
- Overlapping your car insurance, especially when switching insurance companies, ensures that your vehicle is covered throughout the process. A lapse of your policy can mean no coverage in the event of an accident or claim. An error can cause a lack of insurance coverage if dates are input wrong or there is confusion on the part of the agent.
Downfalls of Car Insurance Overlap
- If your car insurance overlaps for too long, it will be expensive to pay for two policies covering the same vehicle. Also, if your insurance overlaps and you experience a loss at that time, the two insurance companies may disagree about which one pays the claim.
How Long Car Insurance Should Overlap
- Car insurance should overlap for a day or two at the most. This will lessen the problems should there be a claim on the overlapping days. To avoid dual policies, have one end at midnight on one day and the other begin at that time.
Who Pays a Claim on Insurance Overlap Days?
- If you need to make a claim during the days that your insurance overlaps, your new insurance company likely will pay the claim, according to the Auto Insurance Select website.
- Write a list of all the cars in your rental fleet. Include model, make, year and license plate number, as well as minor or major damage to any vehicles.
- Make copies of documents such as a business license, tax returns and registration for each of your vehicles. Insurance companies will need you to verify all information with proof.
- Call insurance companies to request a quote for your rental car business. Most insurance companies provide small business insurance services. If you have a very large rental fleet with many employees, it may be harder to find insurance.
- Compare offered rates and coverage.
- Select an insurance company and set up a policy to sell temporary insurance to rental car clients. Rental car companies typically offer a number of add-on insurance options to renters, such as personal liability or collision insurance. Most rental car companies charge $10 to $30 a day for these options. Work with your insurance specialist to create this system.
Principle of Indemnity
- All lines of insurance follow the principle of indemnity. This states that the purpose of an insurance policy is to restore the insured person or business to its financial condition before the loss occurred without causing a financial gain. This is why most insurance settlements are not taxed by the federal government; the IRS only taxes financial gains. When two or more insurance policies exist on the same person or property, the principle of indemnification still applies.
- Because you cannot profit from an insurance claim regardless of how many policies exist, most people do not buy more than one policy per item being insured. The exception is with health insurance, when people commonly have two or more companies insuring them. That is because health insurance benefits vary widely from one company to another, and are sometimes available from the government. As a result, having more than one policy increases the chances your entire medical claim will be covered.
- It is not illegal to buy more than one insurance policy for your home, but doing so is unlikely to increase the amount you collect in a settlement. Insurers report claims to the Comprehensive Loss Underwriting Exchange. If you report the same claim to two insurers, they will discover the multiple claims and coordinate their efforts to determine which company pays primary benefits and which pays secondary. Because homeowner’s insurance is a standard package policy, the second policy is unlikely to offer benefits beyond those covered by the first policy.
- If you don’t mind paying the additional premiums for a second policy, you may see some benefits when you file a claim. Some insurers limit or exclude certain causes of loss, such as mold damage, or limit the benefits on certain items, such as jewelry. A second policy from a different insurer may cover some of these limitations and exclusions. However, it is also possible you can endorse your first policy to cover these things by paying additional premiums to remove the exclusions.
- You need enough house insurance to cover the cost of rebuilding your home at current market prices. As a start, check with a local builder or your real estate agent to find the average building cost per square foot for the area in which you live. Multiply this cost by the total square footage of your home. For example, if an average building cost is $200 per square foot and your home is 1,800 square feet, a rough estimate of the cost to rebuild your home is $360,000. Factors to consider that may increase this amount include the quality of construction materials, customization or home-remodeling projects that increase the value of your home, as well as additional structures on your property, such as a garage or shed.
- Before you can determine the amount of insurance to include for personal possessions, conduct a complete home inventory. In addition to photographs and a detailed list of all the items of value in your home, include receipts for major purchases and appraisals for antiques or items, such as jewelry, art or collectibles whose value may be subject to interpretation. According to the Insurance Information Institute, most policies cover personal possessions at 50 to 70 percent of the amount of insurance you place on the structure of your home. For example, if you insure your home for $360,000, insurance for your personal possessions will be $180,000 to $252,000. If the value of your personal possessions exceeds this, consider purchasing a rider to cover the additional amount.
- If the damage to your home is extensive, or if your insurance company declares your home a total loss, coverage for living expenses can be a lifesaver. Most insurance companies cover standard expenses, such as lodging and meals, at about 20 percent of the amount of insurance you place on the structure of your home. If you insure your home for $360,000, the amount of living-expense insurance on your policy will be about $72,000. Because coverage rates vary widely between individual companies, this is one area you should thoroughly investigate.
- A standard house-insurance policy usually includes about $100,000 of liability insurance to cover claims from property damage that you, a member of your family or your pet causes to other people. This is a minimal amount of insurance, so to better protect your assets, the Insurance Information Institute recommends increasing this level of insurance to between $300,000 and $500,000.
- In addition to choosing the right amount of house insurance, it is important to select the right type. House insurance types range from an HO-1, the most basic, to a guaranteed replacement, HO-8 policy. Although you should talk to your insurance agent to make sure your plan suits your needs, SmartMoney.com recommends starting no lower than an HO-3 policy, as this type provides protections from all perils, such as natural disasters, falling objects and damage relating to faulty plumbing or electrical work, unless the policy specifically excludes them.
- The National Association of Insurance Commissioners maintains information about each state’s requirements; click on your target state on its Map of NAIC States & Jurisdictions to go directly to the insurance commission Web page in your state. Once there, look for information on property and casualty insurance licensing.
States will vary in the amount of pre-license training you’ll need to obtain. In Oregon, for example, you’ll need to complete 20 credit hours of coursework, while in Louisiana you’ll do 40 hours for property and casualty providers. Coursework will cover the auto insurance laws in your state, the general principles of insurance, and other basics for selling insurance to clients. Each state will have a list of approved online and classroom schools; choose one that works best for your budget and projected time frame.
- Once you’ve completed your training and passed the exam given by the training program, visit the website of the National Insurance Producer Registry to register and pay for the property and casualty “producer” pre-licensing exam, covering topics you learned in your training program. If you pass the exam, you’ll need to submit a set of your fingerprints to the state insurance commission before receiving your license for that state.
While you can initiate this process on your own in hopes of landing a job, the other way to start is to apply for a job at an auto insurance company. Companies may want you to have a sales background, and some will help guide you through the training and exams before you begin work.
- Rectify the reason for cancellation, if possible. If your policy was cancelled for non payment, then pay the outstanding amount owed to have the policy reinstated. If it was cancelled for underwriting reasons, such as too many moving violations or too many accidents, take a safe-driver class to help reduce the risk. Your auto insurance history follows you and becomes the basis for underwriting your future auto insurance policies.
- Seek a new auto insurance company if you cannot reinstate your current policy. The cancellation may make it difficult to find a standard auto insurance company willing to insure your car. Depending on the reason for your prior cancellation, you might have to seek coverage from the Assigned Risk Pool. The Assigned Risk Pool is a collection of insurance companies mandated by the state to provide insurance for hard-to-insure drivers.
- Visit your state’s Department of Insurance to find the listing of Assigned Risk Insurance Companies in your area if you cannot secure coverage elsewhere. These are companies mandated by your state to provide coverage for hard-to-insure drivers. Select a company from that list and apply for coverage. Whether your replacement coverage comes from another company or the Assigned Risk Pool, expect to pay a higher premium.
- Complete the application thoroughly and honestly. As mentioned earlier, your auto insurance history follows you, and it’s easy for an underwriter to determine if you are stretching the truth on your application. Lying on an insurance application gives the insurance company the right to void your coverage. In fact, if an insurance company pays a claim and later learns you lied on the application, it may be able to void your policy and you may be required to reimburse the company for claims paid. Voided coverage can potentially be worse than having a cancelled policy.
- Contact insurance providers in your area to obtain insurance quotes. Many insurance companies may not even ask if you have a valid driver’s license.
- Explain to insurance companies, if asked, why you’re without a driver’s license. If it’s because you’re under suspension or revocation for no auto insurance, then the provider will likely give you 30 to 45 days to get your license back or the policy will expire.
- Pass the driver’s exam if you’re just reaching the legal driving age. If that is the case, most insurance companies will cover you with a driver’s permit and then require proof of your license when you pass the test.
- Take proof of insurance to the court if you’re under license suspension or revocation for no insurance, and the court will reinstate your driving privileges. Be aware that you may have to pay a fine as well.
- Show the insurance company proof that your license is now valid so that you can keep your insurance policy active.
Giving Your Information
- Keep your insurance information in an easy to access and identify place in your car, such as a colored envelope in your glove box. Do not keep it with all your other automotive papers. You don’t want to shuffle through three years of oil change receipts during an already stressful situation.
- Show the other party the card provided by your insurance company. Most companies provide cards you can give away to keep. If not, let the other party write down the pertinent information.
- Show the other party your photo identification to confirm that you are who you say you are, then ask to see their ID.
- Instruct the other party to call your insurance company if they have any concerns. Do not give out your phone number or contact information unless instructed to do so by a law enforcement officer.
Getting Their Information
- Ask to see the other party’s insurance information and photo identification.
- Check the photo identification against the name on the insurance paperwork. If it doesn’t match, ask for an explanation.
- Check the insurance information against the vehicle’s model, make, color and license plate. If it doesn’t match, ask for an explanation if you feel comfortable doing so. If not, simply note what you observe and report it to the police.
- Take note of the policy number, insurance company name, insurance company phone number, vehicle license plate and policy holder’s name. Like your company, the other party’s insurer might provide all pertinent information on a card for you to keep. If not, write it down.
- Agree on the date, time and location of the accident. Write this information down.
- Send an e-mail to your insurer indicating that you want to cancel your current policy. Make sure to indicate in the e-mail a follow-up call will be needed from a customer service representative.
- Look online at your insurer’s website and see if they have a form or some other option to cancel an insurance policy. Insurers such as Progressive and Esurance will only have a customer support number listed for an insured to call to cancel a policy.
- Leave a comment when making an online payment for the policy. Many insurers have a section available to leave a comment when making a payment online. If a response is not received within a week make a follow-up call to your insurance company.
- See if your insurer has an option on their website to send a comment directly to customer support if you cannot log onto the site. Include in the cancellation request no more than a name and a telephone number to contact.
- Contact your insurer’s customer support through an online chat option if one is available from their website. A customer service representative may require a customer to call the company to confirm any cancellation request.
- Residents of Spain will have their vehicle almost surely have their vehicle registered in Spain, the easiest way for a resident to find cheap car insurance in Spain is either an online search tool (be sure and specify Spain) or an independent insurance representative. It must be a Spanish agency if your car is registered in Spain. That might seem complicated but it is the law. An online search car insurance search tool will give you the rates and comparative coverage amounts for each company. Simply type in “car insurance Spain comparison” you should come up with several companies offering to compare rates with others. Be aware some companies will not insure high performance vehicles and you will need to include the information on your vehicle type with your insurance application.
- The people who are most likely to have the hardest time getting cheap car insurance in Spain are the tourist, and expatriate. For those who have brought their vehicle that is registered in another country particularly the UK, there are a couple of steps you should follow to be sure you are insured at the cheapest rate possible. Insurance rates in Spain are some of the lowest rates in Europe, however it is the law in Spain that only Spain registered cars can be insured by a Spanish insurance company. European insurance companies in general issue an automatic green card so you are covered in other European countries. Not so with the UK, which limit the period of time they will extend a green card, x number of days in a year. Before your visit, a UK resident with a UK registered car will want to contact their insurer and if their coverage can remain in effect in Spain and for how long.
- You can also find car insurance in Spain through a European based insurance company with a branch in Spain. This is permitted by law there. You might want to be aware though, the rates are often anything but cheap if you must choose this option.
- The final alternative is for expatriates or persons on extended visits from the UK with a British registered car, usually if you spend over 6 months in Spain you may be required to take out a special European insurance policy or insure your vehicle through a British car insurance company with a branch in Spain. How easy it is to find cheap car insurance in Spain will depend upon where your vehicle is registered and the policies in force by your current insurer.
According to Geico, if you already have full coverage on your personal vehicle — including comprehensive, collision and liability coverage — your insurance policy will normally extend to any rental that has a value close to that of your personal vehicle. This type of coverage will even cover you if the rental is considered a total loss in the event of an accident. There is a thin line between being covered and being under-insured, however. Before you turn down coverage at the rental desk, give your insurance agent a call to make sure you understand exactly what is covered when you rent a car, and what isn’t. If your personal policy doesn’t cover everything, you’ll want to purchase whichever coverage your current policy is lacking at the rental desk.
Rental Insurance Options
Rental companies offer a handful of different coverage options. There is the waiver of damage, which covers all or part of the cost for any damage or theft of your rental – assuming you’ve complied with the terms of your rental contract. Supplemental liability coverage covers you – often up to $1 million – if you’re sued by the other parties in an accident. Personal accident coverage covers medical bills and death for the driver and passengers of your rental care. Personal property insurance covers personal items in the event that someone breaks into the vehicle.
- If you decline insurance coverage from the rental company, and your current policy doesn’t cover you, you will be considered an uninsured driver in the event of an accident. You will be liable for all medical bills and auto repairs, along with any other judgments against you if you don’t have coverage.
Credit Card Insurance?
According to eSurance.com, it is possible that you have at least some coverage from the bank that issued the credit card you use to rent a car. Most major credit card companies include at least collision coverage if you use their credit cards to pay for your rental car. Some companies even offer additional coverage that you can purchase that may be cheaper than what the rental company offers. Contact the customer service department at the number listed on the back of your credit card and ask about coverage options.
Your current health insurance may also provide coverage for you, your passengers and anyone else that may be injured in an at-fault accident. Go over your health insurance policy and compare the limits to your state required minimums. Even if your health insurance covers you in a rental car, you might need to purchase the supplemental liability insurance.