Q: What is the minimum coverage required on an automobile that is being financed?
A: If you are buying your vehicle and it is financed, the loan company will require you to carry comprehensive (or “other than collision”) and collision coverage on your vehicle. Some finance companies also have restrictions on the deductible amount you may carry, i.e. $500.
If your vehicle is leased, the lease company will require certain criteria on the liability coverages, as well as the deductibles that you must carry on your policy.
Q: What is the minimum coverage required on an automobile that is paid for?
A: If a vehicle is paid for, the only coverage that is required by law is liability coverage. This will cover any damage your vehicle does to someone else’s vehicle or property. A good rule of thumb when deciding on whether to carry only liability coverage is the value of the vehicle you have.
Q: Do you need auto insurance on a titled vehicle if it is not being driven?
A: If a vehicle is titled and has a valid license plate, it must be covered by liability insurance.
Q: What is difference between Uninsured Motorist (UM) and Underinsured Motorist (UIM) coverage?
A: Uninsured motorist coverage (UM) reimburses bodily injury and medical payment expenses caused by hit-and-run drivers, stolen vehicles,or drivers without insurance. Underinsured motorist coverage provides coverage in situations where the negligent driver has some insurance but not enough. In these situations, it will pay the balance up to the limit on your policy.
Q: Why do my liability limits and UM/UIM have to match?
A: Because liability covers others and UM/UIM covers you. You want to protect yourself as much as you are protecting others on the road.
Q: Why does the UM premium only appear for one vehicle on my policy?
A: The limit applies to the whole policy and not specific vehicles; therefore, it is not a per-vehicle charge but a per-policy charge.
Q: Can my motorcycle, RV and recreational trailer be added to my auto policy?
A: No, all of these items must be covered on their own policies.
Q: Why do the other drivers in the household need to be listed under my policy?
A: Because when the vehicle is garaged at the household, all drivers in the household have access to it.
Q: Why is my auto insurance so high now that I have added my teenage driver?
A: Teenage drivers are four more times likely to have an automobile crash than an experienced driver. The highest rate you will pay is the first year after your teen obtains a driver’s license. Insurance companies will decrease the rate for each year your teen drives, up to three years of experience. There is no rate difference for males or females who are newly licensed drivers. Nor are their differences between your 16-year-old and your 18-year-old if they have just obtained their license for the first time.
Q: I'm just getting my business started. Do I need insurance right away?
A: Yes, because you could suffer a loss even on that first day of business. If you suffer a loss and have no insurance or insufficient coverage, there is very little your agent can do to help you. You must be prepared for the risks that are inherent in any business and the losses that they can cause. Also, many states and local jurisdictions require that businesses be insured to begin operating. And if you rent space for your business, your landlord probably requires that you be adequately insured as well.
Q: I don't have any major business assets. Why do I need insurance?
A: Every business has some property. And your business itself is your property. Just like your home and 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. Property insurance covers damage to or loss of the policyholder's property. And if somebody sued for damages caused by you or your possessions, the cost of the lawsuit would be covered by your liability insurance.
Q: Who decides how much my business property is worth?
A: Property insurance can be purchased on the basis of the property's actual value, on its replacement cost, or on an agreed amount.
The differences among the three are:
Actual Cash Value - The replacement cost of the item minus depreciation
Replacement Coverage - This coverage pays the cost of replacing an item, at today’s cost, without deducting for depreciation.
Agreed Amount - Art objects, antiques and other unique items are usually insured at an amount agreed upon when the policy is being written. An appraiser values the goods to be insured and the business owner and the insurer agree upon an amount that the insurer will pay if the goods are destroyed
Q: I just signed a three-year lease to open my business. Why does my insurance agent want to see my lease?
A: Whether the business lease is for a building or for equipment, your agent needs to determine who is responsible for insuring the leased items – you or the lessor. For leased buildings or space, there are other factors to be considered, such as who is responsible for plate-glass coverage and whether your landlord requires tenants to carry minimum amounts of liability insurance. These and other situations covered in the lease affect the amount and kinds of insurance you need.
Q: What is coinsurance all about?
A: Most business policies include a "coinsurance" clause, stipulating what percentage of the total value of your property must be insured to be fully reimbursed for a loss, even a partial one. (Most losses are partial.) If you insure for less than that amount, your insurance company may impose a "coinsurance penalty" on your claim. Your insurance agent can help you determine and maintain the amount of coverage you need. An endorsement can also be added to your policy that automatically increases policy limits to keep pace with inflation.
Q: I keep one auto strictly for business. Do I need a separate policy?
A: Yes. Whether you have one vehicle or several, you will need a business automobile policy. Such a policy covers any motor vehicle used in your business including cars, vans, trucks and trailers pulled by trucks, and offers coverage if they are damaged or stolen. It also covers liability if the business vehicle is in an accident and the driver is at fault. This policy is not for truckers or commercial garages. They have special liabilities and must secure special policies that deal with their different needs. Businesses with a fleet of vehicles will have different needs than a business with one or two.
Q: Do I need to protect my employees in the event they are injured on the job?
A: Yes, and in most states there are legal requirements that must be met and for which you may be responsible. State laws vary, but most states require that you carry some form of workers compensation insurance. This protects the employee and also offers you, the business owner, a degree of immunity from lawsuit by an injured employee.
Q: Everybody seems to be suing everybody else these days. What if someone sues my business?
A: No business can afford to be unprepared for a lawsuit. Liability insurance protects your business assets when the business is sued for something the business did (or failed to do) that contributed to injury or property damage to someone else. Liability coverage extends not only to paying damages but also to the attorneys' fees and other costs involved in defending against the lawsuit--whether valid or not.
The standard business owner’s policy provides liability coverage, as does a separate policy known as a commercial general liability (CGL) insurance policy. Either will cover bodily injury, property damage, personal injury or advertising injury. The medical expenses of a person or persons (other than employees) injured at the business or as a direct result of the operations of the business are also covered.
Usually excluded are suits by customers against a business for nonperformance of a contract and by employees charging wrongful termination or racial or gender discrimination or harassment.
Q: Why do you need my driver's license number and Social Security number?
A: The driver's license is to verify the driving record; the Social Security number allows us to obtain an insurance score in order to get the best rates from our companies.
Q: When is my next payment due?
A: We represent a variety of top-rated national insurance carriers. Each of our companies has multiple billing plans, so your payment could be due monthly, quarterly or annually. Your payment may also be set up as an automatic bank draft. Check with your Allen Tate Insurance agent or your individual insurance carrier for your next scheduled payment date
Q: What is my deductible?
A: Your deductible is the amount of money you must pay in the event of a loss, before your insurance pays toward your claim.
Q: What will happen to my insurance when I turn in a claim?
A: Several things could happen, depending on the type of loss and amount of claim paid. Your premium may increase, your policy could be canceled or your rate could remain the same.
Q: What is my policy effective date? Do I have a waiting period?
A: The policy effective date is the first day of insurance with the insurance carrier. Most property insurance policies do not have a waiting period except for flood insurance. Flood insurance has a standard 30-day waiting period, unless it is required by a mortgage company for a closing because the property is located in a high-risk flood zone.
Q: What is consent to rate?
A: North Carolina has a Rate Bureau that sets the rates for all the insurance companies in North Carolina for auto and property.
A consent to rate (CTR) is a document which the insured signs that indicates their willingness to pay a rate higher than the rate established by the Rate Bureau. For example, it might be applicable for situations where the insured has a driving record that makes him/her an undesirable risk for insurance coverage.
Q: My daughter will be going to college. Is she still covered by my insurance policies?
A: Your children in college are still considered your dependents, so your home and health insurance should extend to them while they are away at school. Some auto carriers offer a discount for children that are away at school (more than 100 miles) and do not have a vehicle with them on campus.
Q: Why does it matter if I have a trampoline, diving board or aggressive dog?
A: These things are proven to increase your chances of having a high liability loss, and must be considered for insurance coverage.
Q: Why is my dwelling coverage more than what I paid for the house?
A: Dwelling coverage is based on replacement cost to rebuild the house today with brand new materials, thus costing more for replacement than when you purchased the home.
Q: Why has my mortgage company not paid the bill yet?
A: If your homeowner’s insurance is set up to be paid by your mortgage company, one of two things has likely occurred. It is either that we have not billed the mortgage company yet, or your loan may have been sold to another company.
Q: How long can I leave my home policy in place if I have moved to a new residence?
A: Your current homeowner’s policy will cover your original home for 60 days after you move from it to another residence. After that, you should apply for a dwelling-fire policy for your vacant home.
Q: Why do I need a different policy if I have moved out of my home?
A: Vacant homes have additional risks and are more susceptible to claims because they are not occupied and monitored
Q: Is my boat dock covered under my homeowner’s policy?
A: Yes, your dock would be covered as part of your homeowner’s policy, under “Other Structures,” which represents either 10 or 20 percent of your home coverage.
Q: Does my homeowner’s policy cover my jewelry? Do I need appraisals for these items?
A: Yes, you have a small amount of coverage for jewelry with your base homeowner’s policy. If you have an item valued at more than $2,000, you should obtain an appraisal and insure it separately with a personal articles policy.
Life & Health
Q: Can I have more than one life insurance policy?
A: Yes. It is not uncommon to have a group term life insurance policy (a term life insurance policy through your job) in addition to a personally owned life insurance policy (term or permanent). Note: When you no longer work at the company providing the group term policy, you will likely lose that coverage.
Q: Is term or permanent life insurance better?
A: It depends on your specific need for life insurance. If you are only concerned about debt elimination in the event of a spouse death, then term life insurance might be the best fit for your needs. Permanent life insurance is normally used to fill an income gap or as a way to guarantee that the children will receive cash when the parent(s) pass away.
Q: I have children. Should I buy life insurance for them?
A: There are several benefits of purchasing life insurance for your children while they are young. If they keep the policy into adulthood, they will enjoy low premiums until the policy is paid for. Some policies give you the option to increase the amount of coverage later in life. For example, at age 18 you could have the option to add another $100,000 to the existing policy. Permanent policies also accumulate cash value, which could be used to help pay for college or make a down payment on a new home.
Q: What is the best way to pay for life insurance?
A: Electronic funds transfer is always recommended. This minimizes the chance of forgetting to pay the premium, which will cause the policy to lapse. If a policy lapses, you will have to go through the underwriting process again in order to get new coverage which may increase your premiums.
Q: I have not reviewed my life insurance policy in a few years. Is this something that I should do?
A: Yes. New life insurance products and rating tables come into the life insurance market periodically. An older policy might be costing you more than you could pay for a new policy with more coverage. The review stage is also a great time to confirm that the correct beneficiary is listed.
Q: Why do I need long-term care insurance?
A: The main purpose of long-term care insurance is to protect your assets for your spouse or other family members if you require long-term medical care. If you have a family history of certain health conditions, you may be at greater risk for needing long-term care. Medicare does not pay for most long-term care services and eligibility for Medicaid has strict low income and asset requirements.
Q: Do I need earthquake, flood or umbrella coverage?
A: Earthquake coverage is optional. Flood insurance is required when there is a risk of ground-up flooding, but can be purchased for almost any property. It requires a flood certificate to obtain, showing the zoning for that specific property. Umbrella coverage (the most common of the three) is pure liability protection of your assets and takes effect when you’ve reached the limits on your personal policies.
Q: If my neighbor's tree falls on my property, who pays?
A: The policy of the owner of the damaged property pays up to $1,000 for removal of trees that have damaged a covered property because of wind, hail, ice, sleet or snow. It also covers fallen trees that block a driveway and keep a motor vehicle from entering or exiting, or block a handicap ramp or fixture. Insurance does not pay for damage by trees that are dead or diseased.
Q: My home has been damaged by a severe storm. What should I do? Am I covered?
A: If your home has sustained damage from a storm (such as wind or a hurricane), try to protect your home from further damage and contact your insurance agent as soon as possible. If you can’t reach your agent, then call the claims number provided on your paperwork to start the claims process. If the damage is from water, you may want to contact a remediation company as soon as possible. They are used to working with insurance companies and they can respond before you have filed a claim.
Q: Is there such thing as an Act of God provision in insurance?
A: Damages from “acts of God” such as wind, lightning and hail are covered by your underlying policy but are subject to your deductible.
Flood and earthquake coverage is NOT covered by your primary home policy. Earthquake coverage can be purchased at an additional premium. Flood coverage is a separate policy that can be purchased in addition to your homeowner’s insurance. Flood damage to your auto is covered under your comprehensive or "other than collision" coverage.
Q: I rent my residence. Do I need renter's insurance?
A: Renter's insurance should be purchased by anyone who is renting a home or apartment as their primary residence. Renter's insurance will cover damages to your possessions inside the home or apartment, as well as provide funds to cover alternate living arrangements if needed. Landlords are not obligated to cover personal property of the person who rents from them.