Monthly Archives: June 2017

Learn More About Car Insurance Claims are Paid

Since there is no set rule for how insurance companies process claims brought to them, the process can differ greatly amongst insurance companies. However, most insurance companies undertake the steps outlined below. Here is a general overview of what you can expect when you file a car insurance claim.

The Assessment

An insurance adjuster will meet with you, the policyholder, to assess the damage done to your car. Pictures will be taken, and an estimation of the cost of repairs will be given to you and the insurance company. It’s a good idea to have your own pictures beforehand to make sure there are no discrepancies between the damages the adjuster assesses and the ones you are accounting for.

Rentals

Depending on the insurance company, you may be offered a rental car to drive while your car is being repaired. It’s important to keep in mind when renting a car that the time between the assessment and receiving a check can typically take up to 30 days. During that time, you may or not be paying for a rental car in between. Some policies cover this cost while others don’t so make sure to stay on top of it. “Rental reimbursement coverage” is helpful to have in these types of situations. Ask your policy provider about it.

After the assessment, money is mailed by check directly to the policyholder based on the amount determined by the insurance adjuster.

An important thing to note here is that should there still be a loan out against the vehicle, a check will still be mailed to you, but your lender’s name will also be on the check. In most situations, the lender is a bank, and you will be required to visit the bank to formally notify them of your intent to repair the vehicle. Checks are paid out in a number of ways—either to the policyholder or directly to the body shop. This is something you should coordinate with the body shop in advance.

A full and detailed description of what is to be done to the car should be outlined before you enter an agreement with the body shop. Body shops can easily manipulate these situations by adding unforeseen costs to the bill, that you will have to pay, so make sure you secure an overview of the repair costs in writing beforehand. Many times, a repair shop can sign off on an adjuster’s assessment as well to ensure this doesn’t happen.

Things to keep in mind:

Depending on your insurance company, the assessment process, and thus the check you receive can vary greatly. It can be a good idea to get a policy where the check is mailed directly to the body shop. This will ultimately mean that the body shop will not get paid unless it has completed its repairs. Insurers will often also require a pre-determined number of estimates from different body shops. The drawback to this is that the insurer can then choose which body shop to proceed with regardless of your preference. Keep all of these things in mind when considering a policy and subsequently filing a claim.

 

The Type Of Life Insurance

Many people don’t understand why they need life insurance, when they should buy it or what type of policy would best meet their needs. In this article, we’ll describe what type of life insurance will probably make the most sense for you at major milestones in your life.

Term Vs. Permanent Life Insurance
First, you need to understand the two basic types of life insurance: term and permanent.

Term life insurance provides a predetermined death benefit and covers you for a predetermined number of years, usually five to 30. The annual premiums are fixed and are based on your health and life expectancy at the time you apply for the policy.

Permanent life insurance isn’t the best choice for most people. It’s several times as expensive as term life insurance for the same amount of coverage. While your policy does accumulate some cash value through its savings or investment component, which a term policy doesn’t have, you pay a hefty premium for this feature and for having a policy that will definitely pay out one day. A term policy will hopefully expire before you do.

An oft-touted benefit of the permanent policy’s cash account is that you can borrow against it. But, with the money, you could save by purchasing term insurance instead, you could amass your own nest egg so that you don’t need to borrow anything to pay for a large expense. Also, when you borrow against your permanent life insurance policy, you diminish the policy’s value and can defeat the purpose of even having life insurance.

Now that we’ve established that most people should buy term insurance, let’s look at when and why you should buy it and how much coverage you need.

Single with No Dependents
If no one depends on you financially, you usually don’t need life insurance. Your untimely death will certainly affect a lot of people, but it won’t put them in a financial bind in most cases. If your parents aren’t well-off, however, you might consider purchasing a small, inexpensive policy that would cover your funeral and burial costs.

Just Got Married
Getting married in and of itself doesn’t mean you need to purchase life insurance. However, events associated with getting married, like buying a house and having children, do mean that you’ll probably need it soon. Since life insurance gets more expensive as you get older, and since a decline in health could make your policy more expensive or make you uninsurable, you might want to go ahead and get life insurance when you get married if you’re young and healthy.

Just Bought a House
If you’ve just bought a house, among the flood of junk mail you’ll receive will be solicitations for mortgage protection insurance, also called mortgage life insurance. These come in the form of official-looking notices instructing, not asking, you to complete and return a short document requesting personal information such as the borrower and co-borrower’s date of birth, sex, tobacco use, occupation, phone numbers, age and weight. Filling out this form does not usually mean that you’re purchasing an insurance policy; it just sets you up to receive sales phone calls to further discuss mortgage protection insurance and perhaps other financial products.

Mortgage protection insurance guards against the loss of income of the person, or people, responsible for paying the mortgage. This is to prevent one catastrophic event doesn’t lead to another like the loss of your family’s home. Though it is important to protect against the loss of a breadwinner’s income when there are significant household expenseslike a mortgage, you wouldn’t necessarily need to immediately pay off the mortgage if that person passed away, which is what mortgage protection insurance does. What you would really need is cash to cover all of your living expenses. Term life insurance will give you the cash to spend as you see fit.

The only reason to consider mortgage protection insurance instead of term life insurance is if you can’t meet the underwriting criteria for the latter. You may be able to get mortgage protection insurance without passing a medical exam. However, it’s also possible to get small amounts of term life insurance without a medical exam, so if you’re difficult to insure, a combination of both of these products might be right for you.

Baby on the Way
Perhaps the most important time to have life insurance is during the years when your children rely on you to provide for them. As soon as you know that a child will be entering the picture, you should get life insurance, if you don’t have it already. If you or your spouse passes away unexpectedly, the surviving spouse will bear the burden of not only earning an income, but also caring for the children.

At this stage in your life, you’ll want a substantial policy that will not only pay for 18 (or more) years of child-rearing expenses but also ongoing household expenses and perhaps college tuition. Make sure to buy enough insurance to allow your family to maintain the same standard of living.

If you already have life insurance at this stage, you should re-evaluate your policy because you might need to purchase more coverage.

Time to Retire
By the time you reach retirement age, your term policy probably will have run out. If you want life insurance when you’re older, it will be very expensive–possibly prohibitively expensive. That’s because your chances of dying, and the chance that the insurance company will have to pay a death benefit, increase substantially when you’re older. In other words, you become a riskier customer, and insurance companies will ask you to pay accordingly.

If you have a whole life policy, it will cover you until you die, but if you no longer need the policy, you may want to terminate it to save the monthly premiums and get full use of your cash value.

If you’ve planned carefully for retirement and avoided any major financial disasters in your working years, you shouldn’t need life insurance when you’re older. Your retirement accounts and the rest of your nest egg should provide for a surviving spouse’s needs. Your mortgage may be paid off, and your children will be old enough to support themselves.