Just as you depend on your car to run smoothly, you want your insurance to do likewise when you need it. We offer both the products and the services that make that possibility a reality.

Coverage & Considerations

The information provided below pertains to personal auto insurance policies, which are offered in a range of pay out limits, commonly referred to as coverage limits. This means your company will pay out a maximum dollar amount based on the coverage limits that you choose, regardless of the actual costs of bodily injury or property damage incurred in any given accident. Therefore, we urge you to carefully consider the coverage and pay out limits that you purchase.

Liability coverage: Your liability insurance consists of bodily injury and property damage coverage. This coverage insures you against the costs for injury or damage that you cause to other people and their property in automobile accidents. Such costs may include financial liability for others loss of income and compensation for their pain and suffering. State required liability limits might be insufficient to meet these costs. You may, therefore purchase increased coverage to meet such costs.

Medical payments coverage: Medical payments coverage pays the medical expenses resulting from an automobile accident. This coverage is for anyone in your car who is injured in an automobile accident. This inexpensive coverage is not subject to deductibles and pays immediately regardless of whom is at fault.

Uninsured motorist coverage: This coverage protects you against costs for bodily injury that you suffer in a car accident caused by an uninsured motorist. A few companies in Idaho also offer coverage to protect you against property damage caused by uninsured motorists. However, most DO NOT even offer this coverage.

Underinsured motorist coverage: This coverage provides the same type of insurance that uninsured motorist coverage provides, but applies to losses that you incur because a motorist has inadequate insurance rather than no insurance. Because this coverage is so frequently misunderstood, we encourage you to discuss it with your agent.

Coverage for damage to your auto: Two separate coverage options provide you with automobile protection: collision and comprehensive coverage. Generally collision coverage protects you against losses resulting when your vehicle collides with another object. Comprehensive also referred to as "other than collision" insures you against physical damage to your car caused by such events as fire, theft, flood, and vandalism. Deductibles applying to these coverage options range from $100 to $1000. Not surprisingly, the higher the deductible, the lower the premium and vice-versa. While this coverage is not required by the State, your lender may require you to purchase it if you have a lien against your car.

Additional coverage: Additional coverage that you may purchase includes towing (should your car break down), rental car reimbursement (should your car be involved in an accident), special equipment insurance (for equipment attached to your car), and even accidental death and disability insurance that extends from your auto insurance policy. You may wish to discuss these additional coverage options with your agent.
Your duties after an accident or loss: This part of your policy outlines the procedures that you must follow in order to have your claim covered by the insurance company. It is very important to follow these procedures carefully, since the payment of your claim may depend on your doing so.

What is not covered
Your policy outlines a number of events and situations that are specifically excluded from coverage. For example, any property damage or bodily injury damages that you intentionally cause, or damage to a vehicle from normal wear and tear or mechanical breakdown would be excluded.

Who is covered
The declarations page of your policy identifies you as the "named insured", meaning you are the individual who is primarily insured under the policy. As the "named insured", you and your vehicles receive the most extensive coverage under your policy.
Your spouse is generally entitled to receive the same coverage as you (the named insured) under your policy if he or she lives with you, even if he or she is not identified as a named insured on the declarations page of your policy. Both you and your spouse can be identified as the named insured at your request.
Family members (as defined in your policy) are insured as long as they own, use, or maintain the vehicle covered by the policy. In fact, family members generally receive almost the same coverage that you do.
Other people are covered while driving your car assuming they have express or implied permission from you.

Keeping Costs Down

Six suggestions for keeping insurance costs down follow:

Shop around
Auto insurance premiums for like coverage, cars, and drivers can vary markedly from one insurance company to the next. So, shop around, or let us shop for you. If you do shop yourself, be aware that all insurance companies are not created equal. Consider checking independent insurance company evaluators, such as A.M. Best or Standard and Poor’s, to make sure that you are dealing with a reputable company, one who will be there to pay a claim when you file yours.

Also, use care when comparing policy premiums to make sure that you are comparing like premiums for like coverage and coverage limits.

Finally, consider the value of building a long-term relationship with your agent and a given company: agents are more likely to invest time and energy understanding the unique coverage needs and premium limitations of long-time clients, and some companies offer additional discounts and benefits to clients who have been insured with them for three years or more.

Obtain available discounts
Insurance companies offer a number of discounts, including the following: discounted premiums for insuring homes and cars with the same company, paying premiums in full, and paying through the use of automatic withdrawals. So, make sure that you obtain these and other available discounts that your specific insurance companies may offer.

Increase your deductibles
Increasing your deductibles from $250 to $500, or even $1000, can save you a substantial number of premium dollars. Of course, higher deductibles also mean higher out-of-pocket expenses at claim time, too. So, consider whether or not you are financially positioned to absorb higher up front costs before raising your deductibles.

Drop some coverage
Dropping or reducing coverage will surely save you premium dollars in the short run; however, doing so may cost you more in out-of-pocket expenses in the long run than you save in premium dollars. So, make sure that you understand what coverage you need and purchase those.

Consider altering these rate-affecting factors
A number of factors affect your insurance rates, including the following: the type of car that you drive, the number of tickets and/or accidents on your record, the length of time that you’ve been insured with a given company, the timeliness of your payments, and your credit history. Altering these factors can substantially reduce your insurance premiums.

Consult your agent
Your licensed agent is best equipped to advise you regarding your individual coverage needs and possible discounts available. So, we strongly recommend that you select a reputable and competent agent to advise you with regard to your insurance needs.

Safety Tips

Air Bag Safety

Air bags save thousands of lives each year, according to The National Highway Traffic Safety Administration (NHTSA). In frontal crashes, air bags reduce deaths among drivers by about 30% and among passengers by 27%.

Air bags, however, can be dangerous. If small children sit unbelted in the front seat, they can be catapulted into the path of a deploying air bag, which inflates with great force. This risk also applies to small adults, who must sit close to the steering wheel to reach the pedals, pregnant women and the elderly. Infants in rear-facing safety seats on the passenger side can be severely injured because their heads are in the direct path of an inflating air bag. If your airbag is stolen or it deploys, you will be reimbursed under the comprehensive portion of your auto insurance policy. (If your air bag deploys, you have to get a new one.)

Preventing air bag injuries:
Drivers should have all children sit in the backseat wearing a safety belt. Infants should be placed in rear-facing car seats and put in the backseat. Small adults should move the seat back so that their breastbone is at least 10 inches from the air bag cover.

If this is not possible, air bag switches can be installed so that the vehicle owner has the option of turning the bag off or on, depending on the situation. In January 1998, NHTSA allowed auto dealers and repair shops to begin installing air bag cut-off switches. Before the switch can be installed, vehicle owners must complete a four-step process:
1. Obtain an information brochure and request form from NHTSA, dealerships or repair shops.

2. Return the form to NHTSA.

3. Receive authorization from NHTSA after it reviews the case.

4. Take the vehicle to the service shop along with the authorization from NHTSA which certifies that the owner has read the brochure and met one of the four eligibility classifications:

• rear-facing infant seat can be in the front (necessary if the vehicle has no back-seat)
• driver's seat cannot be adjusted to keep more than 10 inches between the driver and the steering wheel
• putting a child 12 or under in the front seat can not be avoided
• having a medical condition that puts them at risk of injury when an air bag deploys.

ALL RIGHTS RESERVED - Insurance Information Institute, Inc.

Child Safety Seats

If you have children it's important to make sure they are secured properly when you drive with them. They are almost always safer when riding in the back, in a car seat that is appropriate to their age and weight.
Using a car seat correctly can prevent injuries, but wrong usage is very common. Even a small mistake in how the seat is used can cause serious injury in a crash.

1. Never put an infant in the front seat of a vehicle with a passenger air bag.

2. Route harness straps in lower slots at or below shoulder level.

3. Keep harness straps snug and fasten the clip at armpit level.

4. Make sure the straps lie flat and are not twisted.

5. Dress your baby in clothes that allow the straps to go between the legs. Adjust the straps to allow for the thickness of your childís clothes. Do not use bulky clothes that could increase slack in a crash.

6. To keep your newborn from slouching, pad the sides of the seat and between the crotch with rolled up up diapers or receiving blankets. If your childís head flops forward, the seat may not have reclined enough. Tilt the seat back until it is level by wedging firm padding such as a rolled towel, under the front of the base of the seat.

7. Put the car seat carrying handle down when in the car.

8. Infants must ride in the back seat facing the rear of the car. This offers the best protection for your infantís neck.

9. Recline the rear-facing seat at a 45-degree angle. A firmly rolled up towel under the car seat may help.

10. All new car seats are now required to come equipped with top tether straps. A tether strap is a belt that is attached to the car seat and bolted to the window ledge or the floor of the car. They give extra protection and keep the car seat from being thrown forward in a crash. Tether kits are also available for most older car seats. Check with the manufacturer to find out how to get a top tether for your seat. Install it according to instructions. The tether strap may help make some seats that are difficult to install fit more tightly.

Do not use a car seat that:

1. Is too old. Look on the label for the date it was made. If made before January 1981, the seat may not meet strict safety standards and its parts are too old to be safe. Some manufacturers recommend using seats for only 6 years.

2. Was ever in a crash. If so, it may have been weakened and should not be used, even if it looks all right.

3. Does not have a label with the date of manufacture and model number. Without these, you cannot check on recalls.

4. Does not come with instructions. You need them to know how to use the car seat. Do not rely on the former ownerís instructions. Get a copy of the manual from the manufacturer.

5. Has any cracks in the frame of the seat.

6. Is missing parts. Used seats often come without important parts. Check with the manufacturer to make sure you can get the right parts.

To find out if your child safety seat has been recalled, you can call the Auto Safety Hotline at 888-DASH-2-DOT. If the seat has been recalled, be sure to follow the instructions to the recall or to get the necessary parts. You should also get a registration card for future recall notices from the Hotline.
To find out more information about infant or toddler car seats, go to the Web site of the Insurance Institute for Highway Safety at www.highwaysafety.org. Also check out the National SafeKids Campaign at www.safekids.org which offers a free Child Car Seat Locator which allows you to enter your childís age and weight, and get back a list of recommended car seats. Another good source of information on car seats is the American Academy of Pediatrics website at http://www.aap.org/family/ which offers a detailed shopping guide to car seats.

Is your child ready for a regular seat belt?

Keep your child in a car seat for as long as possible. When he or she is big enough, make sure that seat belts in your car fit your child correctly. The shoulder belt should lie across the shoulder, not the neck or throat. The lap belt must be low and flat across the hips, not the stomach. The childís knees should bend easily over the edge of the vehicle seat. Seat belts are made for adults. If the seat belt does not fit your child correctly, he or she should stay in a booster seat until the belt fits.

Other points to keep in mind when using seat belts:

1. Never tuck the shoulder belt under the childís arm or behind their back.

2. If only a lap belt is available, make sure it is worn tight and low on the hips, not across the stomach. Use lap belts only as a last resort. Try to get a lap-shoulder belt installed in your car if it doesnít already have one.

ALL RIGHTS RESERVED - Insurance Information Institute, Inc.

Shopping for a Safe Car

If youíre like most people shopping for a new car, safety ranks high among things you're looking for. Every new car must meet certain federal safety standards, but that doesnít mean that all cars are equally safe. There are still important safety differences, and some vehicles are safer than others. Many automakers offer safety features beyond the required federal minimums. The following safety features should be considered when purchasing a car:

1. Crashworthiness
These features reduce the risk of death or serious injury when a crash occurs. You can get a rating of crashworthiness from the Insurance Institute for Highway Safetyís website at http://www.highwaysafety.org.

2. Vehicle structural design
A good structural design has a strong occupant compartment, known as the safety cage, as well as front and rear ends designed to buckle and bend in a crash to absorb the force of the crash. These crush zones should keep damage away from the safety cage because once the cage starts to collapse, the likelihood of injury increases rapidly.

3. Vehicle size and weight
The laws of physics dictate that larger and heavier cars are safer than lighter and smaller ones. Small cars have twice as many occupant deaths each year as large cars. In crashes involving smaller and larger vehicles, heavier vehicles drive lighter ones backwards, decreasing the forces inside the heavier car and increasing them in the lighter car.

4. Restraint systems
Belts, airbags and head restraints all work together with a vehicleís structure to protect people in serious crashes. Lap/shoulder belts hold you in place, reducing the chance youíll slam into something hard or get ejected from the crashing vehicle. If you arenít belted, youíll continue moving forward until something suddenly stops youóoften a hard interior surface that will injure you.

Shoulder belts are on inertia reels that allow upper body movement during normal driving but lock during hard braking or in a crash. Belt webbing is stored on the reel, and during a frontal crash any slack in the webbing can allow some forward movement of your upper body. Then you could strike the steering wheel, dashboard or windshield. This problem is addressed in some cars with belt crash tensioners that activate early in a collision to reel in belt slack and prevent some of the forward movement.

Airbags and lap/shoulder belts together are very effective. However in some circumstances, inflating airbags cause serious injuries and even death. The greatest risk of injury from an inflating airbag is if youíre on top of, or very close to an airbag when it starts to inflate. Choose a car that allows you to reach the gas and brake pedals comfortably without sitting too close to the steering wheel. Some cars offer telescoping steering column adjustments that may help.

Side airbags are designed principally to protect your chest. They may also keep your head from hitting interior or intruding structures.

Head restraints are required in front seats of all new passenger cars to keep your head from being snapped back, injuring your neck in a rear-end crash. But there are big differences among head restraints. Some are adjustable, and others are fixed. They also vary in height and how far theyíre set back from the head. To prevent neck injury, a head restraint has to be directly behind and close to the back of your head. Look for cars that have this type of restraint. If the restraints are adjustable, maker sure they can be locked into place. Some donít lock, which means they can be pushed down in a crash.

5. Anti-lock brakes
When you brake hard with conventional brakes, the wheels may lock and cause skidding and a lack of control. Anti-lock brakes pump brakes automatically many times a second to prevent lockup and allow you to keep control of the car. If you were trained to brake gently on slippery roads or pump your brakes to avoid a skid, you may have to unlearn these habits and use hard, continuous pressure to activate your antilock brakes. Anti-lock brakes may help you keep steering control, but they wonít necessarily help you stop more quickly.

6. Daytime running lights
The ignition switch activates these lights. They are typically high-beam headlights at reduced intensity or low-beam lights at full or reduced power. By increasing the contrast between vehicles and their backgrounds, making the vehicles more visible to oncoming drivers, these lights can prevent daytime accidents.

7. On the road experience
Other design characteristics can influence injury risk on the road. Some small utility vehicles and pickups are prone to rolling over. "High performance" cars typically have higher-than-average death rates because the drivers are tempted to use excessive speed. Combining a young driver and a high-performance car can be particularly dangerous.

ALL RIGHTS RESERVED - Insurance Information Institute, Inc.

Teenagers & Safe Cars

If your teenager has just gotten a driver's license, it may be hard to imagine handing over the keys to your brand new car, but that may be the smartest vehicle to choose.
The first years teenagers spend as drivers are very risky. In fact, teen drivers have the highest death rates of any age group. In 1997 alone, more than 5,700 teenagers died in motor vehicle crashes, and many more were left severely and permanently injured by crashes.
While getting a driver's license is an exciting rite-of- passage for teens, it can be enough to make a parent frantic. The Insurance Institute for Highway Safety (IIHS) and the Insurance Information Institute (I.I.I.) say there's something worried parents can do to protect their teens --
choose a safe vehicle.

Avoid vehicles that encourage reckless driving.
Teen drivers not only lack experience, but may also lack maturity. As a result, speeding and reckless driving is common.
Sports cars and other vehicles with high performance features, such as turbocharging, are likely to encourage speeding. Choosing a vehicle with a more sedate image reduces the chances your teen will be in a speed-related crash.

Don't let your teen drive an unstable vehicle.
Sport utility vehicles, especially the smaller ones, are inherently less stable than cars because of their higher centers of gravity. Abrupt steering maneuvers - the kind that can occur when teens are fooling around or over-correcting a driver error - can cause rollovers in these less stable vehicles. A more stable car would, at worst, skid or spin out.

Pick a vehicle that offers good crash protection.
Teenagers should drive vehicles that offer state-of-the-art protection in case they do crash.

Don't let your teen drive a small vehicle.
Small vehicles offer much less protection in crashes than larger ones. However, this doesn't mean you should put your child in the largest vehicle you can find. Many mid- and full-size cars offer more than adequate crash protection. Check out the safety ratings for mid-size and larger cars.

Avoid older vehicles
Most of today's cars are better designed for crash protection than cars of six to ten years ago. For example, a newer, mid-size car with airbags would be a better choice than an older, larger car without airbags. Before you make a final choice on the car your teenager will drive, consult the U.S. Department of Transportation ( http://www.dot.gov ) or the Insurance Institute for Highway Safety ( http://www.iihs.org ).

ALL RIGHTS RESERVED - Insurance Information Institute, Inc.

Safe Driving Guidelines.

For your own safety and that of others, we encourage you to observe the
following guidelines as you drive:

• Allow yourself sufficient time to drive to your intended destinations so that your good judgment is not undermined by haste and carelessness

• Wear your seat belt

• Obey all the traffic laws

• Drive defensively, paying close attention to how other drivers are driving

• Keep plenty of distance between you and other cars, especially the one just in front of you

• Park in well-lit areas, preferable off the street keep your car appropriately serviced to avoid

• Mechanical failure that could endanger you or others

Elderly Drivers

People 55 years or older are less likely to drive aggressively or too fast. Thatís the reason that most insurance companies offer discounts to drivers over 55.
Still, older drivers are likelier to have impaired hearing and slower reflexes, or to be using prescription drugs that might impair their reaction time. Older driversí eyesight deteriorates, so they need more light to see, are more sensitive to glare and have a narrower peripheral field of vision. So if you are having problems driving at night or in difficult conditions, use common sense and try to avoid driving when it is dangerous. If you drive when you are not physically able to do so safely, your insurance company may not renew your coverage. You may also want to take a defensive driving class designed for seniors. Inform your insurer that you have taken the class and you may be eligible for a discount on your insurance premium.

ALL RIGHTS RESERVED - Insurance Information Institute, Inc.

Driving in Bad Weather

Driving in bad weather is a major cause of accidents. When you are driving, particularly on a long trip, make sure to stay tuned to radio reports about weather conditions. If you hear that an ice storm, hurricane, tornado, flood, hail, or other severe weather is expected on the route you are taking or at your intended destination, change your travel plans. Whatever reason you have for going where you are going cannot be as important as saving your life.
If you are already in an area that is being hit by bad weather, donít try to drive your way out of it. Seek shelter for both you and your car and wait for the storm to pass.

ALL RIGHTS RESERVED - Insurance Information Institute, Inc.

Avoiding Deer / Car Collisions

The explosion in the deer population has lead to the increase in deer/car collisions. Losses due to deer and car encounters will only increase as the deer population continues to grow and urban habitats encroach upon rural environments.

According to the National Safety Council, in 2000, there were 490,000 animal-related accidents resulting in 100 deaths and 10,000 injuries.

Deer/auto collision cost about $2,000 per claim for repairs and injuries. However, costs could run as high as $8,000.

Defensive driving tips to avoid hitting a deer:

• Be vigilant in early morning and evening hours, the most active time for deer.

• Use your high-beam headlights.

• Slow down and blow your horn with one long blast to frighten the deer away.

• Brake firmly when you notice a deer in or near your path. Do not swerve. It can confuse the deer as to where to run. It can also cause you to lose control and hit a tree or another car.

• Be alert and drive with caution when you are moving through a deer crossing zone.

• Always wear your seat belt. Most people injured in car/deer crashes were not wearing their seat belt.

• Look for other deer after one has crossed the road. Deer seldom run alone.
If your vehicle strikes a deer, do not touch the animal. The frightened animal, in attempting to move, could hurt you or itself. The best procedure is to get your car off the road, if possible, and call the police.

Contact your insurance agent or company representative to report any damage to your car. Collision with an animal is covered under the comprehensive portion of your auto insurance policy.

ALL RIGHTS RESERVED - Insurance Information Institute, Inc.

Cell Phones & Driving

Drivers who are distracted by talking on a cell phone or dialing numbers while they are driving are causing more and more accidents. Some municipalities have banned using cell phones while driving because it has caused such a major problem.
If you must talk while you drive, the safest way is to have a hands-free cell phone cradle installed in your car so you can speak while driving with two hands. Even so, remember to stay aware of what is going on around you on the road. Itís easy to get so engrossed in conversation that you miss exits or donít notice what other drivers are doing. Better yet, wait until you have arrived at your destination or pull over to the side of the road to begin your cell phone conversations.

ALL RIGHTS RESERVED - Insurance Information Institute, Inc.

Preventing Carjacking / Theft

Thousands of unsuspecting motorists are carjacked every year.

To minimize the danger of being carjacked:
1. Think of saving your life first. Only then, think of your car and what's in it.
2. If another car bumps your car, stay inside with the windows shut and the door locked and drive to the nearest police or fire station.
3. Donít stop at isolated pay phones, cash machines or newspaper machines where you could become a carjacking victim.
4. Stay alert to people lurking near or moving toward your parked car.
5. Always keep the windows of your car shut and doors locked, whether youíre in or out of your car.
6. Park only in well-lighted areas.

To prevent your car from being stolen:
1. Keep your registration card in your wallet instead of your glove compartment.
2. Use paint or an indelible marker to put the vehicle identification number (VIN) under the engine hood and trunk lid and on the battery. This number is usually found on the dashboard on the driverís side of the car.
3. If you have to leave personal property in your car, leave it in the trunk.
4. Keep your car in a garage and lock the garage door.
5. Use a security device like a steering wheel lock or a gear shift column lock.
If your car is stolen, have the following information to give to the police: 1. Year, make, model and color of the car.
2. Approximate time the car was stolen.
3. Description of anyone you may have seen loitering around your car before it was stolen.
4. Names of any witnesses.

ALL RIGHTS RESERVED - Insurance Information Institute, Inc.

Car Breakdown Safety

If you are in an accident or your car breaks down, safety should be your first concern. Getting out of the car at a busy intersection or on a highway to change a tire or check damage from a fender bender is probably one of the worst things you can do. The Insurance Information Institute (I.I.I.) recommends the following precautions when your car breaks down:

1. Never get out of the vehicle to make a repair or examine the damage on a busy highway. Get the vehicle to a safe place before getting out. If you've been involved in an accident, motion the other driver to pull up to a safe spot ahead.
2. If you canít drive the vehicle, it may be safer to stay in the vehicle and wait for help or use a cell phone to summon help. Standing outside the vehicle in the flow of traffic, under most circumstances, is a bad idea.
3. Carry flares or triangles to use to mark your location once you get to the side of the road. Marking your vehicleís location to give other drivers advance warning of your location can be critical. Remember to put on your hazard lights!
4. In the case of a blowout or a flat tire, move the vehicle to a safer place before attempting a repairóeven if it means destroying the wheel getting there. The cost of a tire, rim or wheel is minor compared to endangering your safety.

ALL RIGHTS RESERVED - Insurance Information Institute, Inc.

Frequently Asked Questions

Where do I go for help with my SR 22?
What does credit have to do with my insurance?
Why do insurance companies want to know about all licensed drivers living with me?
What do I do at the scene of an accident?
How do I file a claim?
What should I do if I am having trouble settling my claim?
If I file a claim, will my premium go up?
How are the value of my car and the cost of repair determined?
What are my rights when filing a claim?
Can my insurance company require me to use certain types of auto repair parts?

What is an SR22?

An SR22 is a form that is required when the state Department of Motor Vehicles (DMV) places a suspension on your license due to some action that you have taken, such as driving without insurance. Upon your request your insurance company will issue an SR22 filing at the time that you purchase, at least, the minimum amount of liability insurance required by the state.

Should your insurance lapse after your company has issued your SR22, your insurance company will notify the state, in keeping with their legal obligations. At that time, your license will be suspended, and you will be required to pay a reinstatement fee to have your driving privileges restored.

Briefly, SR22 filings are the states’ way of insuring that you keep minimum levels of insurance in force.
How do I get an SR22? You get an SR22 when you both sign an application for insurance, as required by the state, and make the initial premium payment to a company who offers SR22 filings. Not every company offers SR22 filings and not every agent is authorized to file them immediately for you. However, agents at Hartley Insurance, Inc., as well as some other local agents are authorized to do so.

How much does the SR22 cost? Nothing, usually. Most insurance companies will issue SR22s as a free service when you purchase minimum liability insurance as required by the state. You are required to pay only the actual cost of the insurance that you purchase.

How long must I maintain an SR22 filing? The length of time that SR22s must be maintained varies depending on individual circumstances. The Department of Motor Vehicles can, however, give you more detailed information relating to your own SR22 filing.

Who will notify me when I no longer need an SR22? No one, probably, because no one is specifically responsible for notifying you, your agent, or your insurance company. Do keep track of the date when you will no longer need an SR22, though, since you may qualify for lower rates at that time.

What does credit have to do with my insurance?

The practice of using credit history as a factor in insurance underwriting is becoming more common. Despite the statistical connection between an individual's credit history and his or her likelihood of filing an insurance claim, some state legislators and regulators are proposing measures to restrict or ban insurers from using this information.

history: Although the use of credit information is new for some insurers, the practice has been permitted since 1970 when the U.S. Congress passed the Fair Credit Reporting Act (FCRA).

The use of credit information provides insurers another tool to use in making fair and objective underwriting decisions. Independent studies have proven a strong connection between credit history and the likelihood of an individual filing a claim. A Tillinghast-Towers Perrin study demonstrated that there was a 99 percent probability of a relationship between a person's credit rating and likelihood of that person having a claim.
Studies by Arthur Andersen and the Insurance Research Council show that credit reports are more reliable than motor vehicle records. In addition, consumers have a clearly defined review process to ensure the accuracy of their credit report.

In January 2000, the Virginia Bureau of Insurance released a study that concluded that credit scoring is an accurate predictor to assess insurance risks and that the use of credit information does not discriminate based on income, race or other demographics.

Rationale: Consumers benefit from the use of credit information because most people have good credit. Insurers have found that using credit information can help them write more policies and allow consumers to pay less. Companies have reported that they are able to accept some customers that would have been denied coverage using more traditional underwriting criteria. In addition, many consumers qualify for lower insurance rates because they have good credit. One NAII member found that using credit histories enables it to charge 70 percent of its customers lower premiums.

Most companies use credit information as just one of several factors in the underwriting decision. It provides insurers with an objective tool for decision-making that evaluates risk and allocates the cost of coverage based on a consumer's claim potential.

Insurers do not use credit information to determine a person's ability to pay premiums. Insurance companies use a credit score to assess an individual's credit risk at a particular point in time. The score looks at specific credit information and assigns a weighted numeric value. It reflects credit payment patterns and looks at items such as collections, bankruptcies, outstanding debt, length of credit history, types of credit in use and the number of new applications for credit.

Credit information helps insurers make more accurate underwriting decisions, applicants and policyholders who are financially stable can enjoy lower premiums, while those who are less stable pay a premium that better reflects the risk they represent. The ability of insurers to make sound underwriting decisions also helps keep the insurance marketplace competitive.

ALL RIGHTS RESERVED - National Association of Independent Insurers

Why do insurance companies want to know about all licensed drivers living with me?

Many insurance companies want to know about all licensed drivers living with you for the following reasons. Your own auto insurance coverage usually extends to others who you authorize to use your car. Those licensed drivers living with you are more likely to borrow your car than are others. Therefore, the insurance company may base their willingness to insure you as well as the premium that they charge you on both your driving record as well as the records of those living with you. This allows companies to charge you a premium that is in keeping with the risks that they are assuming in agreeing to insure you.

On the other hand, some companies may rate your insurance as if no other drivers were living with you as long as such drivers have insurance of their own. Finally, some companies may require you to sign an "exclusion," which permits the insurance company to deny coverage should "excluded" individuals cause accidents in vehicles that you insure.

Even if a company allows you to sign such an exclusion, it may be unwise to do so since doing so places you in a position to assume potentially significant financial risks.

At the Scene of an Accident

Knowing what to do if you are involved in an accident can save lives and also make the claims process easier.

1. Stop your car and find out if anyone is injured.

2. Call the police or highway patrol. Tell them how many people were hurt and the types of injuries. The police will notify the nearest medical unit.

3. Cover injured people with a blanket to keep them warm.

4. Try to protect the accident scene. Take reasonable steps to protect your car from further damage, such as setting up flares, getting the car off the road and calling a tow truck.

5. Ask the investigating officer where you can obtain a copy of the police report. You will probably need it when you submit your claim to your insurance company.

6. If necessary, have the car towed to a repair shop. But remember, your insurance company probably will want to have an adjuster inspect it and appraise the damage before you order repair work done.

7. Make notes. Keep a pad and pencil in your glove compartment.
Write down:
• the names and addresses of all drivers and passengers involved in the accident.
• license plate numbers
• make and model of each car
• driver's license numbers
• insurance identifications
• names and addresses of witnesses
• names and badge numbers of police officers or other emergency personnel.

8. If you run into an unattended vehicle or object, try to find the owner. If you can't, leave a note containing your name, address and phone number. Record the details of the accident.

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How do I file a claim?

Follow these steps:
1. Call your insurance agent as soon as possible, regardless of who is at fault. Find out whether you're covered for this loss. Even if the accident appears minor, it is important that you let your insurance company know about the incident.

2. Ask your agent or company representative how to proceed and what forms or documents are needed to support your claim. Your insurance company will require a "proof of claim" form and, if there is one, a copy of the police report. Increasingly, companies allow you to monitor the progress of your claim on their web site.

3. Supply the information your insurer requests. Fill out the claim form carefully. Keep good records. Get the names and phone numbers of everyone you speak with and copies of any bills related to the accident.

4. Ask your insurance agent or company representative:
• Does my policy contain a time limit for filing claims and submitting bills?
• Is there a time limit for resolving claims disputes?
• If I need to submit additional information, is there a time limit?
• When can I expect the insurance company to contact me?
• Do I need to get repair estimates for the damage to my car?
• Will my policy pay for a rental car while my car is being repaired? If so, how much?

5. Remember, each state has its own laws governing the claims process. If you have any questions, call your agent, company representative or your state insurance department.

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Claim Trouble

What should I do if I am having trouble settling my claim?

If you are not satisfied with how your claim is being handled, there are steps you can take:

1. Let your agent or company representative know that you are unhappy.
If this individual is unable to solve your problem, get the name and phone number of the head of the insurer's claims department. Your insurance company may also have a consumer complaint department that may be helpful.

2. Be prepared to support your case.
Send documents and a letter explaining why you are not satisfied and make sure you have the figures to back up your argument. Be certain to include your address, claim number, day and evening phone numbers, and any other important identifying information.

3. Review your auto insurance policy.
Most companies offer either arbitration or appraisal services to help settle differences and disputes. Your insurance policy will explain these options.

4. Contact your state insurance department.
Explain the reasons for the disagreement to a consumer services representative at the department.

5. Call the National Insurance Consumer Helpline.
If after hearing from your insurance company's claims executive you still feel your claim hasn't been handled properly, call 800-942-4242. It is a toll-free consumer information telephone service sponsored by the insurance industry. Trained personnel and licensed agents are available to assist consumers who have complaints. The Helpline operates Monday - Friday, 8:00 a.m. - 8:00 p.m. ET.

6. Contact an arbitrator to hear your case.
An independent arbitrator with experience in insurance matters can decide if the settlement you were offered is fair. Your insurance company may suggest an arbitrator or you can get your own from the American Arbitration Association at 212-484-4000 or at http://www.adr.org

7. Consult an attorney.
This should be your last resort. However, if you do feel the need for legal assistance, consult an attorney who specializes in auto insurance. Each stateís bar association offers a free legal referral service, which will give you names of qualified candidates. Attorneys work either on an hourly rate or on a contingency basis, depending on the type of case. Get the attorney's fee structure in writing. You can remain current on the progress of your claim by insisting that you receive copies from your attorney of all correspondence. Your attorney must have your agreement before committing to any settlement.
After your claim has been settled, take time to re-evaluate your auto insurance coverage to make sure you have adequate protection to cover you against any future damage or liability claims arising from your car.

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If I file a claim, will my premium go up?

You may be reluctant to file a claim because you fear that your premium will go up or your insurance will be cancelled. Practices vary from company to company. In general, an insurer will increase your premium by specific percentages for each chargeable claim made against your policy above a specific dollar amount. A chargeable claim is one the insurer considers primarily your fault. The percentages and ceilings vary from company to company. These increases generally stay on your premium for three years following the claim.

Your company may also decide not to renew your policy if your driving record gets markedly worse or you have several accidents. Different insurers have different rules about what constitutes an unacceptably bad driving record. But some accidents, such as those caused by drunk driving, will probably trigger a nonrenewal from virtually every insurance company.

If you have an accident but donët report it to your insurer, you are taking a risk, even if the damage seems minor. If the other driver sues you weeks or months later, your failure to report the accident might cause your insurer to refuse to honor the policy. And even if they do honor the policy, the delay will certainly make it harder for the insurer to gather evidence to represent you.

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How are the value of my car and the cost of repair determined?

There are several standard guidelines for determining the value of your car for insurance purposes. You and your insurer can refer to the Blue Book, which lists the depreciated value of all new and used cars. One Blue Book is published by the National Association of Automobile Dealers (NADA) at http://www.nada.com. The other is published by Kelley Blue Book of Irvine California at http://www.kbb.com.

When you file your claim, your insurance company will refer you to a claims adjuster. The adjuster will verify the loss and determine what it will cost to repair the car. The adjusterís estimate can serve as a benchmark to compare your own mechanicís estimate.

No good adjuster or insurance company will expect you to sign an agreement accepting the insurerís estimate as the total claim payment until youíve established, to your satisfaction, that it will cover the cost of repair. The insurer will expect you to get your own estimate from your mechanic, garage or car dealer. Donít allow yourself to feel pressured into accepting the insurerís estimate of repair costs without getting at least one estimate of your own.

Your insurance company can't require you to have repairs done at a particular shop. But they can insist that you get more than one estimate for the work to be done on your car. Just as you want to make sure that your car is adequately repaired, the insurer wants to make sure it doesn't pay a grossly inflated repair bill.
Don't be surprised if your insurance company opts to pay for the lowest bid. You donít have to accept that bid if you believe the low bid wonít adequately repair your car. Don't hesitate to argue with the adjuster if you really believe his repair estimate is too low based on what your mechanic has told you.

One factor that could reduce the amount of your claim for a repair job is what insurance companies call betterment. If your old car is repaired with brand-new parts, your insurer may argue that the repairs have actually enhanced the carís value and therefore they can legitimately reduce your claim by the difference between a used part and a new one.

It's up to your insurer to decide whether to pay for repairing your car or to declare it a total loss and pay you its book value. Most standard auto policies will not pay to repair a vehicle if the repairs cost more than the cash value assigned to the car. There won't be any dispute about whether to repair the car if it was completely totaled. But you may argue about what the pieces of the car were worth when they were assembled as a car. For you to get a settlement higher than the Blue Book value of your car's make and model, you will have to submit evidence such as mileage records, service history and affidavits from mechanics to show that your car was worth more. Youíre entitled to the market price of the car you just lost. You shouldnít get more or less than what you are due.

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What are my rights when filing a claim?

As a policyholder, you have certain rights. Every state has laws protecting consumers. Your policy is a legal contract between you and your insurer. It defines your rights and obligations as well as the rights and obligations of the insurance company.

If you have any questions regarding your rights under the policy, talk to your insurance agent or company representative. You may also contact your state insurance department, state attorney general's office, or your state's consumer affairs department.

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Can my insurance company require me to use certain types of auto repair parts?

Your insurance company can't require you to use only certain kinds of auto repair parts. However, if the insurance company's rates are based on a certain type of part and you want something different, it can ask you to pay the difference if the part you want is more expensive.

The parts most frequently damaged in auto accidents are "crash parts". These are the sheet metal pieces that cover the engine and frame of the car. These may be parts known as original equipment manufacturer (OEM) parts, or generic parts. These crash parts do not affect the safety of the car. The development of a market in generic parts has brought prices for car replacement parts down and saved consumers money.
In general, if generic parts have been ordered for the repair of your car, this information must be disclosed. The car repair order should state that the parts are not from the original manufacturer and the warranty may be different. Many generic parts are made at the same factories as OEM parts, and in fact very few OEM parts are actually made by car makers.

Insurance companies that use generic parts guarantee the parts they use. If the part doesn't fit properly, the insurance company will generally put on an OEM part at no extra cost.

Some auto insurance companies offer their policyholders a choice between OEM and generic repair parts as part of an endorsement (addition to the policy that changes its terms and conditions) that includes other choices as well. Some always specify OEM parts for repairs and some use OEM parts for repairing recent model cars. A few states require insurance companies to offer generic parts when they exist and some may require OEM parts to be used.

Ask your insurance agent about your state and your insurance company's claim settlement guidelines so that you'll know what to expect if your car has to be repaired after an accident.

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