coveringyourassets

Helping you protect what you've worked so hard to obtain.

Even Mom and Pop Businesses Need Commercial Auto Insurance

Are you a Phoenix small business owner who uses your personal vehicle for business with only personal auto coverage?  Did you know your personal auto carrier will most likely deny a claim if you were doing anything business-related at the time of the accident?  Believe me, they’ll find out – especially if you have any signage on your car.  Even one claim could wipe out your Arizona business and destroy everything you’ve built.

Many business owners think commercial auto insurance is expensive, but that’s not necessarily the case.  It all depends upon what type of business you do, how many miles you drive, the types of vehicles you’ve got and, of course, your driving record.  I even offer liability-only commercial car insurance for those with older vehicles that aren’t really worth getting full coverage on.  I’m a broker and have programs specific for all types of small businesses, artisans, and light commercial usage.

I’m a Phoenix business owner, too, and I know how irritating it can be to have businesses soliciting me all day long.  It’s disruptive and annoying.  If you’re interested in getting a quote for commercial auto insurance, I’ll make you this promise:  No annoying phone calls.  No high pressure sales pitch .. not ever.  To get started, you’ll need to fill out a form with your business information, then within 24 hours or so I’ll send you an email quote.  If you like what you see and it fits with your business budget, you call me and we’ll go from there.

Click Here for a Commercial Auto Quote

Tavisha
Go Time Insurance
(602) 938-1515

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How is My Arizona Car Insurance Premium Determined?

ImageThat’s a great question and one that can save you a lot of money if you take the time to understand the factors used by insurance companies to derive your rate.

  • Your Driving Profile.  The items of information that comprise your driving profile include your MVR record of accidents and tickets, as well as how many miles you drive annually.  If you drive five miles per day to work, your premium will likely be less than someone who commutes 50 miles per day.  And, obviously, if you’ve had several at-fault accidents or speeding tickets within the past 36 months or a DUI within the past five years, your rates will be higher – as the insurance company considers you a higher claims risk.
  • Your Personal Information as it Relates to Actuarial Tables.  The insurance companies spend a lot of time and money evaluating data and compiling it into actuarial tables.  They have a pretty good idea of the claims likelihood of someone in your age rage, with your occupation, living in your area.  They have created detailed statistics regarding trends for accidents and auto thefts in your area, as well as the average costs for car repair and healthcare for your city.
  • Your Credit Score.  According to the Insurance Information Institute, how a person handles their finances is an accurate reflection of the frequency and size of their insurance claim history.  With the economy the way it is right now, many people who once had great credit are being turned down or surcharged for standard insurance because their credit rating has taken a hit.  Go Time Insurance specializes in offering nonstandard insurance (click the link to read our article explaining the difference).  Most of the carriers we use don’t use credit scoring, but rather use “insurance scoring,” which evaluates your insurance history and stability when determining your rate.  We even have a few carriers we offer who don’t look at either credit or insurance scoring.  These are a great match for our clients who have issues with both credit and insurance history (like previous cancellation for non-payment, or cancellation and reinstatement with lapses).
  • The Car You Drive.  While it’s pretty obvious that a high-end sports car would probably cost more to insure than a modest four-door compact, there are other factors that are not so obvious that go into determining the cost to insure your car.  I recommend you give us a call and tell us the make and model for any cars you’re considering purchasing.  Knowing the insurance rate can be a deciding factor in helping you determine which car would be the best choice for you.
  • Amount of Coverage.  It’s important to have an adequate amount of coverage to protect your assets, but it’s equally important that you don’t purchase more coverage than you actually need.  If you own a home with a lot of equity in it (don’t laugh – it’s just an example), you would want to make sure that your coverage limits are at least equal to the amount of equity in your home.  Otherwise, if someone makes a claim against you for an at-fault accident and your auto policy limits are inadequate to cover the claim, your personal assets could be exposed.  Of course, your homeowners policy would be next in line for any claims.  So, it’s important to reduce liability exposure by coordinating your auto and homeowners policies to insure adequate coverage.
  • The Deductible You Select.  Regarding deductibles, the higher your deductible is, the lower your premium will be.  Keep in mind that you should always select a deductible amount that you can live with.  If it would be difficult for you to come up with $1,000 to make up your part of any physical damage repair to your car, then perhaps drop it down to $500 or even $250.  However, if you could live with a $1,000 deductible, you’d be looking at as much as 40% reduction in the comprehensive and collision portion of your premium.
  • To “Full Coverage” or Not to “Full Coverage.”  Removing the comprehensive and collision portion of your coverage sometimes makes sense when you’re driving an older car.  The statistics on comp and collision claims are that those who carry it make a claim an average of once every 11 years.  And, even so, a total loss only occurs about once every 50 years.  If you multiply your premium for comp and collision by 10 and arrive at a number that is more than what your car is worth, you might consider dropping the comp and collision portion of your coverage and putting that amount into savings instead.  It all depends on your comfort level for doing so, though.  Everyone involved – you and your carrier – are both making calculated decisions regarding risk, and everyone is hoping to come out financially ahead regarding their decision.

I hope this has helped you to understand a little bit more about how your rate is determined.  If you decide to shop around for auto insurance quotes, make sure you are comparing apples to apples in terms of coverage, deductible, and financial rating for the insurance companies you’re considering.

If you live in the Phoenix area and need any assistance reviewing your coverage, please feel free to contact us anytime for a no-obligation, no pressure review.  We’d love to assist you with any information you need.

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AZ House Voted Down Proposed Legislation to Impound Uninsured Vehicles

Last Thursday, March 22, 2012, the Arizona House Appropriations Committee voted down a bill that would have required police to impound on the spot any vehicles they found to be uninsured during routine traffic stops.

While the bill sounds good at first – the insurance industry did not support it.  Why, you ask?  Wouldn’t it just create more revenue for them?  Well, the Arizona Department of Transportation, which oversees MVD operations, has reported there are as many as 200,000 incorrect entries in their database – often due to the insurance providers entering an incorrect VIN number for vehicles, or due to an MVD employee making a typo.

Do we really want to impound someone’s vehicle (who’s legally insured) due to a clerical error?  Also, who’s going to pay for the towing and impound fees in such a case?

I think we can all agree that the purported 10-14% of Arizona drivers who are driving uninsured is a huge problem that affects us all.  Let’s hope our legislators can come up with a better way of dealing with it that won’t impact people who are following the law but had their information entered incorrectly into the system.

If you have any questions about your car insurance or would like a free quote, please contact us.  We’re well behaved, don’t bite (often), and will always respect your time.

Go Time Insurance, (602) 938-1515

 

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What are Arizona’s Minimum Car Insurance Requirements?

Most Arizona drivers know that the state requires 15/30/10 car insurance – but, do you understand what those terms mean?

Every state mandates its own minimum requirements, and Arizona’s lawmakers made ours 15/30/10. 

The first two numbers indicate the level of bodily injury coverage that’s required.  $15k per person per accident, and $30k total per accident.  So, if you caused an accident injuring three people and, for demonstration purposes, they each had $15k in medical bills, only two of them would be able to collect on the insurance policy.  The first two who submitted claims would have access to the $30k limit for bodily injury.  The third person would have to sue you to try to collect for their medical bills.

The number “10” refers to the amount of property damage coverage that is available on the policy.  In this case, there would be $10k available to pay for any damage you caused to their vehicle.

As you can see, these minimums truly are minimum.

Will minimum state coverage work for you?  Well, there are several ways you can look at this question.

  1. From a purely legal standpoint, this will satisfy the requirements of the law and you won’t get cited for not having insurance.
  2. However, from a “covering your assets” perspective, it most likely will not be enough coverage.  Keep in mind, that any deficit in your insurance coverage in relation to the injuries/damage you cause will legally be your responsibility to pay for.  If you have other assets (such as a home, business, or investments) that a plaintiff (because at this point, it’s a lawsuit) could go after, trust me — they will.  So, in order to cover your assets adequately, you’ll need to discuss with your insurance agent the level of coverage you’d need to ensure you can keep all the stuff you’ve worked so hard to get.

If you have any questions as to whether you’re adequately covered, please give us a call and we’d be happy to go over your coverage with you.

Go Time Insurance, (602) 938-1515

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What is the Difference Between Standard and Nonstandard Insurance?

My agency specializes in nonstandard car insurance and one question I get asked all the time is what’s the difference between the insurance I sell and the “other guys” – you know, the guys who advertise on TV and are more well known.

Most people assume it has to do with the financial health of the carrier, or their quality of service to their customers.  But, the truth is that it doesn’t have anything to do with any of that.

The only difference between standard and nonstandard insurance is the policy forms they are written on, and the range of applicants that can be accepted.

Standard policies are written on “standard” policy forms that are approved by the state – in my case, in Arizona.  These “standard” policy forms are cookie cutter policies that are very similar from company to company in terms of what they cover and what they cost.  Another thing they share is that most standard policies have very narrow underwriting guidelines – so they are geared to the client with good credit and a good insurance history.  They limit exposure for risk for the insurance companies by excluding those with poor credit or a poor driving record.  All of the standard carriers love these because of this reason.  Hence, why they are called “standard” carriers.

Nonstandard policies are also written on state-approved forms, but they vary widely in pricing because they are custom policies designed by the insurance company who issues them to accept a broader range of risks.  Also, many nonstandard carriers don’t take your credit rating into account, although some do what is called “insurance scoring” – which is different from credit scoring in that it’s only looking at your stability at your address, your track record in paying you car insurance, and things like that.

Nonstandard can be less expensive or it can be more expensive than standard policies – it all depends upon the risks presented and the appetite for the carrier for that type of risk (most nonstandard insurers specialize in risks that are unique to their company).  So, it’s important for your agent to know which nonstandard carrier will accept the risks you’ve got (if any).

So, as I’ve said, “standard” or “nonstandard” has nothing to do with the financial health or A.M. Best rating of the insurance company – or the quality of the coverage provided.  I’ve heard people refer to nonstandard insurance as “substandard” insurance.  But, this term is very erroneous as no state would ever permit a substandard insurance policy to be sold.  So, nonstandard insurance should not be considered substandard in any way as it offers essentially the same coverages as standard insurance does – but for a broader class of people who may not be accepted otherwise.

If you have any questions regarding car insurance, please feel free to call us anytime.

Go Time Insurance, (602) 938-1515

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Why Do I Need UM/UIM Coverage?

I’ve learned as I talk to my customers in Phoenix every day that very few people really understand what uninsured motorist and underinsured motorist (UM/UIM) coverage is.

Let me take a few minutes to help clear this up.

Uninsured motorist coverage will cover bodily injury that happens to you or anyone in your car in the event someone hits you and does not have any insurance at all – or if you are involved in a hit and run accident.  It won’t provide any physical damage coverage for your car — only for bodily injury.  If you want your car covered, you have to purchase comprehensive and collision coverage.

Underinsured motorist coverage is similar – but different.  Let’s say someone hits your car, injuring you and a friend.  The person who hit you is cited for the accident (so, they’re at fault) and they have state minimum coverage – which, here in Arizona, is 15/30/10.  This covers $15k bodily injury per person with a total of $30k for the accident, and $10k for property damage.

You and your friend have injuries amounting to $21k for you and $18k for your friend.  Your car has $8k in damage.

So, since the person who hit you only has minimum coverage – they are underinsured for this accident.  Their insurance would cover your car completely since the damage is within their limits, but their insurance would only pay $15k each toward the injuries both you and your friend sustained.  This leaves a $6k balance for you and a $3k balance for your friend that would not be covered by the insurance of the person who hit you.

This is where your underinsured motorist coverage would come into play.  Your coverage would pick up the remaining balances for both of you (up to the limits of your UIM coverage).

In Arizona, you cannot have more bodily injury coverage for yourself than you have for others.  So, in other words, if you have state minimum coverages for others (15/30/10), then the maximum amount of UM/UIM you could purchase would be the same 15/30.  The 10 for physical damage does not apply, since UM/IUM does not cover your car.

The above example explains the concepts in the simplest terms, but the incident described is a minor accident.  Imagine the same scenario, except that your injuries are major – requiring a long recovery period, retrofitting your house for a wheelchair ramp, buying a wheelchair van, etc.  If you have higher policy limits on your car insurance, you’re able to purchase a higher level of UM/UIM.  So, your UM/UIM coverage could mean the difference between being covered for the things you need when you need them (i.e. wheelchair ramp, specially-equipped vehicle, etc.) and having to come out of pocket on these purchases (or going without).  For a major accident, UM/UIM coverage can end up being a big deal.

If you have any questions about your Arizona coverage – and want to make sure you’re properly covered, give us a call anytime.  We’d be happy to review your coverage with you.

Go Time Insurance, (602) 938-1515

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