FAQs: Most Popular
Most policies are “permissive” use policies so you would be covered. If you purchased a “named-driver” or “named-operator” policy, only drivers listed on the policy are covered.
There are a number of things you can do to lower the cost of your homeowners insurance. The best thing to do is to shop around. It is not surprising to find quotes on homeowners insurance that vary by hundreds of dollars for the same coverage on the same home. When you shop, be careful to make sure each insurer is offering the same coverage. Many insurers use the ISO policy forms, but this is not always the case.
Another way to lower the cost of your homeowners insurance is to look for any discounts that you may qualify for.
- Many insurers will offer a discount when you place both your automobile and homeowners insurance with the them.
- Insurers offer discounts if there are deadbolt exterior locks on all your doors, or if your home has a security system.
- Newer Home discounts. Some insurers offer discounts on homes that were recently built.
- Renewal Discounts. Some insurers will lower your premium if you renew with them.
- Another easy way to lower the cost of your homeowners insurance is to raise your deductible. Increasing your deductible from $250 to $500 will lower your premium, sometimes by as much as five or ten percent. However, be careful to make sure that you have the financial resources necessary to handle the larger deductible.
Sewer & Drain backup are usually excluded from your policy. Most policies will add coverage for an additional premium.
Coverage C applies to all your personal property (except property that is specifically excluded) anywhere in the world. For example, suppose that while traveling, you purchased a dresser and you want to ship it home. Your homeowners policy would provide coverage for the named perils while the dresser is in transit – even though the dresser has never been in your home before. Coverage for property off premises is typically limited to 10% of Coverage C.
Insurance requirements relating to minimum coverage differ from state to state. Liability is the only insurance required by law in California. The limits required in California are often referred to as “15/30/5” coverage and include:
- $15,000 bodily injury per person
- $30,000 maximum per accident
- $5,000 property damage per accident
Is minimum coverage sufficient?
In determining your coverage limit, one of the most important factors to consider is the overall value of your assets. If, for example, you own a business or a home, you may want higher limits of liability coverage to protect those assets. Another consideration is to protect future earnings. While there is no set formula, you always want to secure coverage in proportion to your assets, so in case an accident did occur, you have sufficient coverage to cover the loss. If you are at fault and severely injure another person, you may be held personally liable for the bodily injury and physical damages beyond the scope of your liability coverage.
Additionally, if you lease or finance your car, it’s likely that your liability coverage limits may have to be higher, usually $250/500,000. You should check with the leaseholder to determine the appropriate level of your coverage. For our customers who own businesses we recommend a minimum of $1,000,000 in auto liability coverage. Most auto policies do not offer a liability limit this high so a personal umbrella may be needed.
Our main rule of thumb is to buy as much liability insurance as you can afford. PIA customer support agents are licensed, non-commissioned insurance professionals and can provide advice regarding general coverage limits.
Call your Customer Service Representative before you purchase your new, or used, vehicle to make sure you will be covered when you take possession of the vehicle.
Whenever you knowingly loan your car to a friend, family member, co-worker etc, you may be covered under your automobile insurance policy. In fact, even if you do not give explicit permission each time a person borrows your car, you may be covered as long as they had a reasonable belief that you would have given them permission to drive the car. If you are carrying a named-operator policy, only the individuals named on the policy are covered while they drive your car. Although often less expensive, a named operator policy should be clearly disclosed before you purchase the policy.
Also you should be aware that when you purchase liability insurance, that coverage goes with you from car to car. (This is not true in all cases read your policy) In other words if you borrow a friends car and are involved in an accident, and have car to car coverage, your liability policy will cover you when driving your friends car. However your liability policy will not protect your friend, he/she must have their own liability insurance to be protected. Conversely it is important to make sure that the people who drive your car have insurance. Because irregardless of whether or not they have insurance, you can still be sued. Very important to understand is that under California law the registered owner of the vehicle is the one responsible for the damage caused by their vehicle, even if they are not driving it (except in the case of stolen cars). So if your friend is driving your car not only will your friend get sued but so will you.
Remember that your liability coverage travels with you from car to car. So whether you are driving your car, a friend’s car, or a rental car, your liability insurance follows you. However the physical damage coverage does not work the same. In most cases, your personal automobile insurance policy will provide coverage only when you are renting a car on vacation. Many insurance companies no longer extend personal automobile insurance coverage when you are traveling on business. The best way to find out what rental car coverage you have under your automobile policy is to call your insurance agent and verify if you have coverage or not.
The duties you need to perform after you have an accident are prescribed both by state law and by terms of your contract.
- First call an ambulance if anyone is injured..
- If the property damage appears as though it may exceed $500, call the police to have a report taken.
- Exchange information with the other driver(s) involved in the accident your name, address, telephone number, and the name of your insurance company and/or your insurance agent. Also get the license plate number of any car involved.
- At the first opportunity, you should contact either your insurance agent or your insurance company to notify them that you have been involved in an accident.
- Finally, there are a number of conditions in the insurance contract that you must satisfy in order to receive compensation from your insurer. For example, you need to cooperate with your insurer during any investigation undertaken during the claims settlement process.
Failure to complete any of these actions can, and sometimes does, result in non-payment by your insurance company for losses that otherwise would have been covered.
Under California law a good driver is defined as someone who has been licensed to drive in the continental United States for three continuous years and has one point or less on their driving record. Insurance companies verify your point count by checking your motor vehicle record and through the use of shared claims data companies such as CLUE and ChoicePoint. Most tickets and accidents count as one point. However, some count as two. Accidents involving property damage only count as one point. If the accident involved any bodily injury, any at all, it counts as two points. The only way to prove an accident did not involve bodily injury is to obtain a copy of the police report, or a letter from your insurance company who covered you at the time of the accident. Major violations such as drunk driving, reckless, exhibition of speed, speeding over 100 MPH are two point tickets. Tickets count as points for three years. After three years they drop off your point count. They may still appear on your driving record, but the insurance company cannot count that against you. Also note that some companies use the Violation date to determine the three year period while others use the Conviction date.
As long as you have one point or less and have been licensed for three or more continuous years, your rates should not fluctuate more than 5% or so.
Insurance companies use several factors to determine how much your premium will be. The most important are your years of driving experience, violation and accident point count in the last three years, type of car you drive, where the vehicle is garaged, and most importantly how much insurance you buy.
The best way to lower the cost of your automobile insurance is to look for any discounts that you may qualify for. Examples:
- Multi Car Discount, put all vehicles you own on same policy.
- Auto & Home Discount, insure your car and home with the same company.
- Driver Training Discount
- Good Student Discounts, 3.0 or better GPA.
- Mature Driver Discounts, for drivers over 55, course certification required.
- Educational Discounts – For certain degrees, Educators, Engineers, etc
- Government/Military Discounts , for civil servants and government officials.
Find out how much you can save if you increase your deductibles.. Usually it is best to keep your Comprehensive Deductible lower. You will find there is little savings in lower the deductible. However there are larger savings when you increase your Collision Deductible, sometimes 5-10%.
We represent insurance companies that offer the following discounts:
Good Driver Discounts, 1 or fewer points in the last three years of driving
Good Student Discounts, full time students with a GPA 3.0 or higher
Multi Car Discount, put all vehicles you own on same policy.
Auto & Home Discount, insure your car and home, or renters/condo policy, with the same company save 5-10% on both policies
Driver Training Discount
Mature Driver Discounts, for drivers over 55, course certification required.
Professional/Educational Discounts – For certain degrees, Educators, Engineers, Doctors, etc
Government/Military Discounts, for civil servants and government officials.
Motorcycle – members of the Gold Wing Club
Your car must be registered in your name in order for you to obtain insurance. If the vehicle is registered under a different name, no insurance can be issued to you until your name is on the registration. An electronic registration verification is available through the DMV for an additional cost.
No, the wear and tear on your vehicle is not covered as a part of your insurance policy.
This is sometimes a very difficult question to answer. The first thing to remember is that you are only insuring the physical structures. You are not insuring the land. If you are a first time homeowner and purchase a home for $500,000, you do not necessarily need to buy $500,000 of coverage for the home. Determining the cost to rebuild your home and appurtenant structures is something that should be discussed with an agent who specializes in homeowners insurance. Professional Insurance utilizes two software packages to determine the replacement cost of your home. There are several factors that will determine the homes cost to rebuild.
- Location, what city is the home located in.
- Square Footage.
- Roof type.
- Design of home, custom vs. tract home.
- Foundations, the shape and soil conditions.
- Number of floors.
- Number of rooms.
- Number of Chimneys.
- Number of bathrooms.
- How many cars the garage will hold. etc.
The reason this is so important is due to the fact that homeowners policies can contain co-insurance clauses or can have maximum limitations on how much coverage the home has. Although most policies contain a replacement cost endorsement, that endorsement may require the home to be insured for a 100% of the replacement cost. And the replacement cost endorsement may cap the amount paid in the event of a covered claim to 125% of the replacement cost stated in Coverage A of the policy declaration page.
When the Oakland Hills Fire hit, the claims settling process was a nightmare for most insurance companies. Almost all of the homes were under insured. Custom homes that cost $450,000 to rebuild were only insured for $225,000. They were underinsured because the homeowner had not notified their agents of upgrades done to the home. However the largest problem came from agents who insured homes for less than replacement cost value. By lowering the replacement cost value the agents were selling lower premiums. The agents were also advising their clients not to worry since they had “replacement cost” coverage. PIA does not condone this practice and it is not something we allow.
[Note: this answer is based on the Insurance Services Office’s HO-3 policy.]
Coverages A and B provide protection to the dwelling and other structures on the premises up to the policy limits.
The policy limit for Coverage A is set by the policy owner at the time the insurance is purchased. This is the amount the insurance company will pay to have your home or dwelling rebuilt in the event of a covered cause of loss.
The policy limit for Coverage B is usually equal to 10% of the policy limit on Coverage A.
Coverage C covers losses to the insured’s personal property. The policy limit on Coverage C is equal to 50% of the policy limit on Coverage A.
Coverage D covers the additional expenses that the policy owner may incur when the residence cannot be used because of an insured loss. The policy limit for Coverage D is equal to 20% of the policy limit on Coverage A. This covers extra costs to rent a hotel room, set up utilities etc.
The coverage limit on Coverage E – Personal Liability – is determined by the policy owner at the time the policy is issued. Liability options are usually $100,000, $300,000, $500,000 and $1,000,000. It is best to discuss with an agent how much liability insurance to buy.
The coverage limit on Coverage F – Medical Payments to Others – is usually set at $1000 per injured person.
In the event of a claim to common areas in your condominium or homeowners association, the association may assess each unit owner with a portion of the monetary damages or deductible. Loss assessment pays for the damages if the damage is caused be a covered cause of loss. An example would be if a tree fell on some fencing damaging the fence. Your association’s insurance policy has a $25,000 deductible. The cost to repair the fence is $15,000, below the Association’s policy deductible. The association is comprised of 5 units. Each unit owner would be assessed $3,000 to cover the repairs.
There are a number of factors you should consider when purchasing any product or service, and insurance is no different. Here is a checklist of things you should consider when you purchase homeowners insurance.
- First and foremost, purchase the amount and type of insurance that you need. Remember that if your policy limit is less than 80% of the replacement cost of your home, any loss payment from your insurance company will be subject to a coinsurance penalty. Also, determine the amount of personal property insurance and personal liability coverage that you need.
- Second, determine which, if any, additional endorsements you want to add to your policy. For example, do you want the personal property replacement cost endorsement or the earthquake endorsement?
- Finally, once you have decided on the coverage you want in your homeowners insurance policy consult with an agent to find the company that offers you the best coverage at the best price. Also check to see if one company can insure your car and home and offer you discounts on both.
Most homeowners and dwelling policies exclude any business activities conducted from the home including day care. They may also exclude any business property. PIA does have carriers that will insure certain types of businesses on the homeowners policy. In addition our Business Insurance Department has companies to insure in home businesses. Contact your Customer Service Representative to see if your in home business can be added to your homeowners policy
Standard homeowners and dwelling policies contain vacancy clauses that limit, reduce, or cancel coverage if a dwelling is lefStandard homeowners and dwelling policies contain vacancy clauses that limit, reduce, or cancel coverage if a dwelling is left vacant for than a specified number of days. Check with your Customer Service Representative to see if you are covered or not. t vacant for than a specified number of days. Check with your Customer Service Representative to see if you are covered or not.
Not required by law, covers you for your bodily injury bills if you are hit by someone who does not have enough insurance. In the form of a split limit or a single limit with some companies. Example if you purchase $15/$30,000 UM coverage, and you are hit by someone who only has $15,000 of bodily injury coverage but you have $30,000 of bills, the company will pay you up to $15,000 since you were hit by an underinsured motorist.
Not necessarily. The Consolidated Omnibus Budget Reconciliation Act (COBRA) gives certain former employees, retirees, spouses, former spouses, and dependent children the right to temporary continuation of health coverage for up to 18 months. COBRA applies to companies with 20 or more employees.
You will have to pay for your own health coverage but you’ll get the same discounted or “group rate” your former employer pays.
Also, keep in mind the new the federal Health Care Reform Law enacted in March 2010. Under this law, if you don’t find a new job with employer-paid health care coverage, you’ll have to buy your own insurance or else pay a penalty to the federal government.
Up until March 2010, the general rule was that an employer could change or even eliminate a health plan so long as it followed the rules and guidelines set out by the Employee Retirement Income Security Act (ERISA).
However, under the new federal Health Care Reform Law passed in 2010, employers with at least 50 employees will be required to provide and keep health care coverage for its employees by 2014. They’ll have to pay a penalty to the federal government if they don’t do so.
In some circumstances, depending on how long you’ve been off work and how much longer it will be before you can return to work, your employer may be able to terminate you. But you can’t be fired simply because you went on disability.
Most policies provide limited coverage for these items. To provide the best coverage for these items they should be “Scheduled” on your homeowners policy. There is an additional charge for scheduling these items. When you do schedule an item the deductible is typically eliminated. To schedule an item a current appraisal or sale invoice is required.
For example, if you notice one day that the diamond on your ring is chipped or lost, the loss will be fully covered without deductible. Coverage is limited to the value stated on the policy.
Covered losses under a homeowners policy can be paid on either an actual cash value basis or on a replacement cost basis.
- When “actual cash value” is used the policy owner is entitled to the depreciated value of the damaged property.
- Under the “replacement cost” coverage, the policy owner is reimbursed an amount necessary to replace the article with one of similar type and quality at current prices.