FAQ – Personal Auto

Senior Drivers

Most of the problems associated with traffic accidents are often related to extremes in ages of drivers. The biggest concern has always been new drivers. Teens will always cause more than their share of accidents because they don’t have the experience or maturity to drive with as much care as they should. But, inevitably, time passes and their driving improves. However, that improvement doesn’t last forever.

All drivers continue to age and, eventually, driving skills will be lost. It is up to us as individual drivers to address how we handle our ability to drive a car, van, truck or SUV. It is important to recognize that older drivers can make adjustments. It probably comes at no surprise that the easiest way to adjust driving habits is to pay greater attention to traffic signs, signals and speed limits. Obeying posted instructions will decrease the chance that an older driver will have to rely on deteriorating eyesight and slower reflexes to avoid an emergency situation.

Some states have laws that increase requirements for older drivers to renew their driving privileges. However, such requirements, such as shorter licensing periods and mandatory driving tests don’t occur until drivers are well past 70 years of age. It makes more sense for drivers to change their habits as well as look for ways to objectively assess their current driving skills. Mature drivers should consider the following:

  • Consider restricting driving to non-peak hours whenever practical
  • Avoid driving in poorer weather
  • Stop driving at night
  • Be aware of how any prescription medicines may affect vehicle operation
  • Voluntarily take driving tests so an objective party can evaluate skills
  • Search Websites, such as those sponsored by state motor vehicle departments, senior associations or driving clubs which offer self-assessment questionnaires
  • Reduce distractions while driving, such as minimal or no use of cell phones, audio devices, etc.
  • Be more sensitive to feelings of fatigue and don’t drive while tired
  • When circumstances call for it, consider giving up your license and depend on other means of transportation

As a group, older drivers will soon grow to unprecedented size. It will be as individuals that this group can make sure that it doesn’t cause unprecedented problems.

Become A Better Driver

American drivers are pointing fingers again. A recent survey bears some grim news.the other guy and gal behind the wheel is ruder, more aggressive and is causing more accidents. A recent survey sponsored by several motorist and insurance organizations discovered that:

  • Most drivers have recently operated their car, truck or SUV in a risky manner
  • Many drivers think that other classes of drivers should have their driving skills regularly tested
  • The majority of drivers think that their driving habits are fine.everyone else is the problem

It is time to stop pointing fingers. Let’s put our hands back on our steering wheels. Regardless who is at fault, the number and severity of accidents and road tragedies are increasing. The only thing that is under your control is your own driving behavior. While you can’t predict what another driver is going to do, you can make a stronger effort to make the roads and streets safer.

Obey traffic lights, signs and road markings. All of these are important methods to control traffic and minimize accidents. Just try to figure out how much time you “save” by tailgating, lane changing and running traffic lights. If you save anything, it’s seconds, not minutes. Also, if you are involved in an accident, you’ve just lost any time ever gained by risky driving. Insurance paperwork and accident reports can claim hours and days of your life. If time is important to you, then take the time to pay attention to the rules of the road.

You will also find it healthier and safer to avoid paranoia. The other drivers in the other cars and trucks are not out to get you. Don’t take things personally since the silly things that happen in cars are usually mistaken or mindless, not malicious. Just relax and concentrate on your own driving. Yield right of way to others, stop for school buses, and watch for pedestrians and bicyclists. The more patient, respectful, and attentive drivers there are on the road, the better it will be.for all of us (and our insurance rates).

Exchange Students – Automobile Coverage

Check with your exchange student program coordinator to see what kinds of coverage are automatically provided for the child. But don’t take anyone’s word, get copies of documents that prove the coverage situation. This article briefly discusses how a personal auto policy responds to exchange students. Please be sure to read its companion article, “Exchange Students – Homeowners Coverage.”

First, make sure that the exchange student is permitted to drive under the rules of the exchange student program. If program rules allow driving, contact your motor vehicle department to make sure that your student has a valid driver’s license.

The typical auto policy, such as the Personal Auto Policy, extends its coverage to any person having your permission to drive a covered vehicle. Your liability coverage will protect the exchange student against damage he or she causes to other property and people. Coverage to damage done to your vehicle is also available when you have the appropriate collision and comprehensive coverages. Of course the coverage is subject to your policy’s insurance limits, deductibles and other provisions.

Medical payments coverage will apply to the exchange student who is injured in an accident while occupying or driving your car with your permission.

If you expressly forbid the exchange student to drive your vehicle and the student does anyway, you may not have insurance coverage, but you may still be found liable under a court of law – perhaps for improper supervision of a minor. Permission to use the vehicle in some policy forms must come from the person named on the auto policy.

Discourage any exchange student who is a minor from purchasing a car, truck, motorcycle, RV, boat, moped, scooter or any other vehicle. An exchange student’s status makes it very difficult to get proper coverage and causing an accident as a vehicle owner could create complex legal problems. If faced with an exchange student who owns a vehicle, it is important to get any available assistance from the exchange student program, including their legal counsel. You should seek your own qualified legal help to make sure that your interests are protected. The safest course would be to avoid an exchange student situation that includes an owned vehicle.

Please check with a qualified automobile insurance agent after reading this and before your exchange student arrives. Virtually every state has its own special state-mandated endorsement that will expand or limit the coverage we describe here. Companies may use different forms that provide coverage that is quite different than the Personal Automobile Policy Form.

Treating Young Drivers Equally

It used to be that, despite all the traditional “woman driver” jokes, young ladies beginning to drive were different from their male counterparts..they were safer. Time passes and things have changed, this time for the worse. Trends, particularly accident statistics, show that girls are gaining equality with boys on the roadways.

The latest information from the National Highway Traffic Safety Administration reveals that the youngest set of female drivers, aged 16, are becoming involved in more accidents. While 16 year old boys are still the scourge of the traffic system, 16 year old girls, licenses still warm from the laminating machine, are closing the gap regarding accidents, increasing their involvement in both non-fatal and fatal categories. Another factor contributing to the equality is that the accident rate for boys in the same age group is improving.

What action should parents of a budding driver take? Begin by recognizing that your new driver, girl or boy, needs your help. Make sure that you provide proper instruction and driving practice. If you’re not already, become a positive driving role model. Once he or she has a license, resist any urge to allow broad driving privileges or to assign responsibility to take over chores such as driving younger siblings. Also, make sure that you exercise control over how and when they can operate a car. Finally, bite the expense bullet and make sure your son or daughter is properly insured. Your insurance professional can give you more assistance in seeing that your new driver turns into a safe one.

Does That Car Have A History?

Let’s consider another type of auto protection that occurs before shopping or buying insurance. What can you do to improve your satisfaction with a new or used car purchase? Of course the simple things are to take time to take a close look at the cars under consideration and ask pointed questions about them including how they handle in turns and emergency braking. Just as important is to be comfortable with the party selling the vehicle, such as a reputable dealer.

Of course, particularly with used cars, vans or trucks, personal inspections and a vehicle Q&A may still be insufficient to get all the details you need. A method that may be more helpful and certainly less expensive than taking a car to a trusted mechanic is to check out the car’s history. But don’t worry, rather than suggesting that you find an automotive private investigator, you only need to start searching with your trusty PC.

A relatively new service available on the ‘Net provides historical information on any vehicle that has a legal identification or a VIN (vehicle identification number). An entity call Carfax is typical of such a service. For a reasonable fee and armed with the VIN, a subscriber may request a search for information and can be alerted to any number of potential headaches such as the vehicle:

  • is stolen
  • was repaired after a serious accident
  • had its odometer reading lowered
  • suffered flood or other weather-related damage
  • is or was part of a manufacturer recall
  • has a history of recurring repairs
  • was previously used by emergency personnel
  • was used commercially (delivering pizzas, newspapers or as a taxi)

All of these are serious problems that, without a car history service, can be easily hidden from an unwary buyer. Why not take advantage of the ‘Net to find a service that can help you be certain that you find a car that is worth insuring?

Avoiding Flooded Vehicles

If you’re ever in the market for a used vehicle, you probably know that it’s important to find a car that is both affordable and reliable, with affordability often being the higher concern. However, while getting a good price, you need to be sure that your “bargain” isn’t due to it having taking a swimming course.

When serious storms or hurricanes result in flooding, the impact on the car market is felt nationally. Cars that may have been totaled because of serious water damage in one state may end up in another, without a clear indication that it was waterlogged. A person looking at any used car must take steps to avoid buying a car that is nearly guaranteed to needing serious repairs soon.

Flooded cars are often cleaned up by original owners or dishonest dealers and sold to auto auctioneers without information about the water damage. Such vehicles may face a laundry list of problems such as:

  • bacteria infestation (due to damp, hidden areas)
  • more rapid rusting and corrosion
  • engine damage
  • electrical system damage
  • brake, brake pads damage
  • operating parts contamination (with dirt and other particulate matter)

In an ideal world, the fact that a car or truck has been flooded and cleaned or repaired should be told to prospective buyers.

However, since our world falls short of “ideal,” you should protect yourself from buying a flood-damaged vehicle. This can be done by asking questions and doing a little detective work. First, ask the seller why the vehicle is available for sale. Sometimes it’s best to be blunt by asking whether the vehicle has ever been in an accident or suffered flood damage. Then take a close look at the car, being careful to spot clues that it’s been water damaged. If you write down the auto’s Vehicle Identification Number (VIN), you can use that information to find out the vehicle’s history. A number of Internet sites offer history reports services including VHR Online and Carfax. Further, either you or a trusted mechanic can inspect the car for the following signs:

  • A damp or musty odor in the car’s interior
  • Existence of brittle wiring casing
  • Debris beneath carpeting floor pads
  • Water line marks or silt
  • Rusting of any metal bolts, door hinges or other pieces in a car’s interior (including the car seat springs)
  • Grass, dirt or debris on a car’s air filter
  • Any pooling of water or signs of rust in the trunk, spare tire and/or car jack
  • Evidence of moisture in gauges

Be certain to check that all electrical items such as lights, horn, radio/CDs, turn signals and headlights operate properly. Also be on the lookout for signs that a seller is hiding something, such as a used car that has had carpeting or upholstery replaced or a car that was recently painted. Other ways to protect yourself are to insist upon a warranty, refuse to buy any vehicle on an “as is” basis and to take the vehicle out for a test drive.

Remember, besides the cost of the used car, SUV, pick-up or van, you also face the costs of registering and insuring the vehicle. Make sure that the transaction isn’t spoiled by a watery surprise.

Are Your Child Passengers Safe?

If you regularly carry young passengers in your auto, have you done everything possible to make sure they’re safe? Are you familiar with what is involved in keeping children safe? If you’re not, read on for some tips on what’s necessary to protect the persons most vulnerable to injuries during car accidents.

Guidance from Child Restraint Laws?

While you might think it would be safe to comply with your state’s child safety or restraint law, you would be wrong in many states. The National Safe Kids campaign recently reviewed the states’ child restraint laws and found them to be quite inadequate. Based upon the guidelines of its own model child restraint law, nearly every state inadequately protects its children. How? In most instances state laws fall short in the following areas:

  • penalties for restraint law violations are too low to encourage compliance
  • rarely establishes restraint guidelines for children older than eight
  • too many exceptions to the restraint laws exist
  • few states offer child-seat loaner or assistance programs

How Are Child Passengers Best Protected?

While you’re likely familiar with the needs of infants and toddlers, the focus of protection usually is upon a child’s age or whether a safety appliance exists. Here are some considerations for protecting young auto passengers:

Infants – Should be in well-constructed and padded infant carrier that should be located in a rear seat. Infant seats should be of the type that is made to face the rear of the seat and NOT the front of the passenger area. Infants must be protected from the chance of being thrown forward into hard surfaces.

Toddlers – Should be in well-constructed, padded child carriers that, while facing forward, should only be placed in the rear passenger seats. Again, this is to minimize the chance of hitting hard surfaces (such as a dashboard or a windshield) and to avoid air bags which are designed to protect adults.

Pre-schoolers – May move from child carriers to well-constructed and padded booster seats. The purpose of the boosters is to make sure that the seat belts fit properly. As with child carriers, these restraints should be installed in rear passenger seats.

Older children – Around age 12, it should be safe to allow children to ride in a car’s front seat. HOWEVER, the age guideline assumes that a child has become tall and heavy enough to be properly secured by regular restraints. Be careful that shoulder straps either fit these children properly or are properly tied-down so they don’t represent a hazard. Also, be realistic. Age is a secondary consideration to body size. If a child’s small build results in a poor fit for regular seat belts and shoulder straps, continue placing the child the rear with a secure seat belt.

A disconcerting fact from the National Safe Kid campaign survey is the high incidences of children who are allowed to ride in cars without restraints or while improperly secured. This sad fact results in hundreds of thousands of serious injuries and deaths. Every passenger in a vehicle should use restraints that are appropriate for his or her age and size. Don’t depend on a law; depend on what’s needed to keep everyone safe.

Why Does My SUV Cost More Or Less To Insure?

What Is an SUV Compared to a Car, Van or Truck?

Private passenger vehicles include coupes, sedans, sports cars, pickups, vans, mini-vans, station wagons, jeeps and sports utility vehicles (SUVs). These vehicle classifications are based primarily upon the physical characteristics, driver use and performance. For example, sports cars are built low to the ground (low profile or clearance) for peak handling ability and speed. Pickup trucks have more powerful engines and open cargo areas for hauling and towing. SUVs have a high clearance or profile and have enclosed cargo areas. They are capable of handling off-road driving, accommodate more passengers (compared to trucks) and have a higher cargo-carrying capacity. SUVs could legitimately be considered as hybrids of other vehicle types. One thing SUVs have in common with other vehicles is that they have to be insured. Insuring SUVs – A roller coaster

SUVs have come to dominate vehicle sales as well as the nation’s roads. Insurance companies have had to create a pricing and underwriting philosophy toward them. As it turns out, a pricing and underwriting approach is less of a philosophy and more of a roller coaster ride. Why has it become a ride? Well, at first glance, it seemed to make sense to charge a LOT to insure an SUV! SUVs are big and very expensive, which translates into very expensive to repair or replace. Then it became apparent that passengers were safer in such heavy vehicles, so it would cost less to pay for their injuries in accidents. Then insurers recognized that something was overlooked: those big, safer vehicles inflicted higher damage to smaller cars during accidents, so more money is paid for injuries to other drivers and their demolished vehicles. Insuring SUVs – Two roller coasters

Now there is more than one roller coaster ride as insurers are focusing on different areas of these perplexing vehicles. One insurance powerhouse is focusing on the fact that SUVs are safer for their passengers. Since owners and riders don’t suffer as many injuries, it has announced a discount for the rates it charges for Medical Payments coverage (which pays for injuries to the persons named as insureds under an auto policy). Simultaneously, several other well-known insurers have publicized plans to increase SUV rates on liability coverages (which pays for injury or property damage caused by an insured driver). Keeping Insurance A Mystery

An immediate result of these contrary approaches is to continue the industry’s strong tradition of being a mystery to consumers. How can the SUV-buying public understand how the same type of vehicle is being priced differently (for different reasons) by different insurers? The only thing that is clear is this: if you have questions about insuring an SUV run, don’t walk, to an insurance professional and talk about your needs.

How Do I Protect My Classic Car?

Standard Is As Standard Does

Depending on the type of car you own and your driving history of tickets and accidents, you are likely insured in the standard or preferred auto market. Standard and Preferred markets are nearly identical. They both cover typical car owners, driving typical cars in typical uses. Typical or average cars and operators allow insurance companies to use a comfortable set of assumptions on what to expect for the number or losses and the expense of repairing the losses so that premiums can be developed and charged. But what if you own a classic or antique auto? Well the above assumptions can be tossed out because you’re in a special coverage situation. Coverage Needs

You may have to reach out to the specialty market for protection of your special auto. A classic auto is commonly considered to be an auto around 15 to 25 years old and, naturally, has appreciated in value. Specialty coverage is necessary because standard auto coverage rates are based upon a car losing value each year due to aging and normal vehicle use. The owner of a classic or antique car needs coverage for a vehicle that maintains or increases in value. Further, such owners have to deal with a carrier that has expertise in handling losses to their collectible cars as well as being experienced in making the necessary considerations to charge the right premium. Rating And Eligibility Considerations

Specialty car insurers typically base their rates on elements such as:

  • car’s current value (often established by appraisal)
  • any special design or features
  • deductible
  • use (exhibition, touring, parade)
  • availability of storage in a locked garage
  • owner’s age (no youthful drivers)
  • whether spare part coverage is included
  • availability of another car for normal vehicle use
  • whether the car’s coverage includes automatic increases to account for inflation

If you have a special auto, talk to your insurance professional for advice. He or she shares your concern for having the right type of coverage.

What Are Auto Symbols?

This is a brief discussion on a major factor that is used to develop your auto insurance premium: auto symbols. Your Coverage Is Symbolic Auto insurance collision and comprehensive coverage rates are based on several factors, such as a vehicle’s:

  • original cost new
  • horsepower, size, weight, other physical characteristics
  • year of manufacture (model year)
  • vulnerability to damage, and
  • sports features (speed, handling, styling, seat capacity)

The above items are represented in a Vehicle Identification Number (VIN). Besides being used as a sort of automobile fingerprint, each VIN is converted into a number between one and twenty-six. At this point, the number is called a “symbol.” The higher symbols are assigned to higher end cars such as Mercedes, Ferrari, and similar vehicles which represent the ultimate in luxury, styling, sportiness, etc. Logically, the lower symbols are assigned to modest cars, but even the little Yugo has a symbol higher than one. Other Characteristics That Affect Symbols

Insurance companies look at vehicle safety features, weight to horsepower ratios, body styling, utility of the vehicle and many other factors beyond the price of the vehicle when assigning a symbol. Generally, vehicles that are known for their safety features (Volvos, Saabs, etc.) receive lower symbols than comparably priced sedans and will cost less to insure. Two door, two-seater, high horsepower vehicles will generally receive a symbol much higher than their actual value because of their sport or high performance nature. Such cars are built to attract drivers who take advantage of the speed and handling ability of their cars.

An insurance company may actually increase or decrease a symbol based upon the claims and damage repair cost history of a vehicle. This can happen a few months or several years after a new model is introduced. Symbol changes may also be made for vehicles that are prone to special dangers such as vehicle rollover or gas tank explosions. Why You Should Consider Symbols?

First, it will affect your cost to insure a new car. Ask your agent about the differences that features make before buying a car. A simple decision such as ordering a 4 door vs. a 2 door could make the difference in hundreds of dollars in additional insurance costs over the years.

Second, insurance companies calculate their premiums based only on factory built cars containing factory installed options. Other dealer-installed options or aftermarket options (installed by custom auto shops) may not be covered unless you tell your agent. Sure you’ll have to pay additional premiums, but that’s better than the alternative of not having a feature repaired or replaced after a loss. Cars, trucks and vans are big investments that need to be properly insured. Talk your needs over with an insurance professional to make certain that you’re protected.

Driving Through A Winter Wonderland? – pt 2

In this part, let’s talk about making long trips, skidding, actions to take when you’re stranded and driving in the right frame of mind. Preparation For Long Trips Long distance trips by car or truck can be dangerous during the winter, so here are some suggestions for minimizing the chance of the trip becoming a tragedy:

  • find out about expected weather conditions at locations along your route
  • tune into local stations for information on road conditions
  • give persons on either end of your trip a travel itinerary including planned departure and arrival times and call these persons to let them know of your safe arrival
  • stop frequently for resting and re-fueling
  • travel as much as possible in daylight
  • be familiar with your route, carry recent maps and prepare alternate routes
  • be prepared for travel delays and be willing to pull over on the road or to stop at road shelters to wait out poor driving conditions

What To Do If You’re Stranded

  • pull your car over as far off the road as possible to avoid being hit
  • put on any additional clothing to keep warn
  • use phone or radio to call for help
  • it is better to stay with the car and run the engine periodically, not continuously
  • conserve your energy; over-exertion by trying to move your vehicle or shoveling too long endangers your health
  • melt snow for drinking water
  • move your arms and legs to improve your circulation and to keep warmer
  • before leaving your vehicle, consider the outside temperature. A person can freeze very quickly, especially if there is much wind
  • If you are stranded in an area where there is regular traffic, put on your flashers or raise your car’s hood to attract help

What to do if you start to skid

Above all, try not to panic. Abrupt or wild steering or braking will make things more dangerous. Skids occur when the car’s speed overcomes tire traction. If you do not have anti-lock brakes, gently pump your brakes until the car slows and traction (ability to steer) is regained. If you DO have anti-lock brakes, apply steady pressure until control is regained. If you are able, try to steer your car in the same direction in which you’re skidding. In other words, if you’re skidding to the right, turn your STEERING WHEEL (not your tires) to the right. This action should counteract the skidding. Drive With A Winter Frame Of Mind

Winter driving often becomes frustrating due to having warm weather driving habits, expectations and behaviors. Cold weather driving becomes easier when you’re realistic. Winter travel takes more patience, care and planning. A 30 minute drive during clear, sunny and dry conditions is no longer possible under snowy, slick or icy conditions. Minimize your frustration and increase your chances for safe travel by doing the following:

  • allow more distance between you and the car ahead of you as safe braking distances are MUCH longer on slick roads
  • slow down
  • watch for icy conditions, especially on bridges and overpasses
  • keep your headlights on so that your car is more visible to other drivers
  • don’t start driving until your windows are clear of frost, snow, etc.
  • clear snow and ice from your vehicle’s lights
  • leave for destinations earlier, expecting that travel will take significantly longer
  • drive with a higher level of awareness of traffic and road conditions
  • clear snow from the top of your car so that it doesn’t later obscure the view of other drivers
  • use caution when approaching intersections
  • avoid sudden braking, turning, accelerating and lane changes
  • make it a habit to wash your car, including the underside, regularly to remove harsh chemicals and salts which are corrosive

Winter often does provide a beautiful backdrop in which to drive, but it helps if you’re patient, cautious, realistic and prepared.

Driving Through A Winter Wonderland? – pt 1

Driving during a snow laden winter can take your breath away. However, the season’s beauty comes with equal peril. The elements that create stunning winter landscapes also bring driving nightmares. Driving safely during the months that include snow, blinding storms, ice and slush takes preparation and the proper mind-set. What considerations do drivers need to make during the coldest of seasons? Well, there are several areas that really need your attention. In part one we’ll discuss preparing your car and getting equipped for handling emergencies. Preparing Your Car

Cold weather makes it necessary to make sure that your vehicle is ready to stand up to its rigors. A stalled car may be an irritating inconvenience in warm or moderate weather. However, the same circumstance could literally endanger a driver’s life when it occurs in a winter storm or during extremely low temperatures. Your goal should be to minimize the chances of a vehicle breakdown by having a qualified mechanic inspect the following:

  • Wipers
  • Tires (tread wear, alignment, and traction by maintaining air pressure)
  • Brakes
  • Radiator and coolant system
  • Transmission
  • All fluid levels
  • Hoses, clamps and belts

It is important that once checked (and any deficiencies corrected), a car owner be sure to periodically certify that these items remain in good order. This is especially crucial prior to long trips.

Preparation For Emergencies

Wintertime driving calls for drivers to be ready to deal with the hurdles represented by weather conditions and the likelihood of being stranded. Car owners should consider having the following items available to deal with routine and emergency winter driving situations:

  • ice scraper
  • first aid kit
  • snow brush and small shovel
  • heavy blankets
  • flares
  • flashlight
  • matches
  • metal cup or small container (in order to melt snow for drinking water)
  • small or basic tool kit
  • bag of cat litter or sand
  • candles
  • salt
  • extra clothing (coat, boots, gloves)
  • jumper cables and drive belts
  • extra gallon of antifreeze and windshield wiper fluid
  • extra quart or two of motor oil
  • car phone, cell phone or citizen’s band radio
  • non-perishable food
  • a dry support for a car jack such as small, sturdy wooden board

It is also helpful to keep plenty of fuel in your car or truck’s gas tank to avoid running out during weather related snags in traffic or if you must pull off the road.

Is Diminished Value Covered?

The issue of diminished value (DV) has long been a great debate among insurance companies, lawyers, state courts, consumers (including activist groups), auto parts manufacturers, auto repairs shops and others. The focus on whether such losses are covered concentrates on claims that a policyholder would make to his insurer for damage to his or her own car. Answering this question is only clear from one’s viewpoint. Supporters of the DV theory say that these losses are real and should be reimbursed under an insurance policy whenever there is accidental damage to a covered car. Other groups say that such losses are similar to depreciation and were never intended to be covered. Factors affecting this debate include:

  • Can DV be accurately measured?
  • What are the financial stakes of the groups supporting each side of the issue?
  • Should DV be considered only when a vehicle is repaired and then sold?
  • How is an older car’s “pre-accident” value measured?
  • Should repair shops or insurers bear the responsibility for DV?
  • The wording of applicable insurance policies.
  • Current and pending state laws involving DV.
  • If DV is paid and a vehicle owner sells the car without a loss of market value, does the DV payment have to be returned to the insurer?

Courts’ Views

Over a dozen, high-profile cases have been decided by courts nationwide over the last 18 months. Most of the cases have resulted in the courts dismissing DV as a legitimate area of coverage, but there has been a notable exception. In November, 2001, Georgia’s Supreme court ruled that DV should be considered whenever a loss occurs to a vehicle, so insurers will have to include DV in any settlements they make.

What To Do About DV

The only thing that is really important to you is your unique coverage situation. Depending upon the age and value of your cars, you may or may not have a concern over this issue. If you do, your best bet is to discuss your concerns with an insurance professional. You can find out what coverage options may be available or, at the very least, gain a better understanding of your existing coverage.

What Is Diminished Value?

Has your car ever suffered from diminished value (DV)? DV refers to damage to an auto that reduces its market value. There are several different types of DV:

Inherent DV: Describes a general conviction that a wrecked vehicle, which is then repaired, is less valuable than a vehicle that is accident-free. This belief is unaffected by having information on the scope of the repairs or by whether there are any visible signs of repair

Example: Will Prudunt is ready to get a new car. Although his ’98 model has served him well, he’s ready for a change. After finding his dream car, Will wants to make a good trade-in deal. Will and the sales rep look over his ’98 and agree on a $3,950 trade-in. As they discuss the loan papers, the rep asks if the ’98 has ever been in an accident. Will slaps his forehead and says “Oops, I was rear-ended three years ago. My insurer paid about $2,000 in repairs.” The sales rep then picks up the finance paperwork and says that he will have to re-figure the agreement. When he comes back, the rep says that they can only offer him $2,400 on the trade-in. Will points out that he’s never had any problems with the car and that it ran even better after the repairs…the rep won’t budge on the lower trade-in offer.

Claim Related DV: This refers to any instance where an insurer’s action or practice results in an inferior vehicle repair. This is subjective because parties can argue over what is meant by inadequate repair. Insurer actions that could trigger claims-related DV include an insurer’s:

  • insistence upon the use of selected auto repair shops
  • requirement that a repair facility use after-market, rather than original, equipment and manufacturer parts
  • refusal to pay for additional repairs identified by a repair shop.

Repair Related DV: This refers to any instance where a repair shop’s action or practice results in an inferior vehicle repair. What is considered a below-standard result that is created by a repair shop may involve:

  • completed work which includes below standard labor or improper procedures
  • completed repairs where below-standard parts were used when an insurer authorized standard parts
  • incomplete repairs when an insurer authorized that all needed repairs be performed.

A Fresh Look At SUVs

Sports Utility Vehicles Still Popular

It’s been roughly a decade since Sports Utility Vehicles (SUVs) have made a serious splash on the traffic scene. Today, more than ever, they are the undisputed kings of the road. Further, their popularity is still climbing for the following reasons:

  • they have a very comfortable ride
  • they’re heavy and sturdy, making them safer in collisions
  • they’re capable of handling certain types of inclement weather better than smaller vehicles
  • they’re more stylish than pickup trucks and large vans, making them more attractive to female drivers.

The combination of power and safety have propelled these vehicles into a position of dominance in sales and, naturally, on the streets and highways. An early reason for the popularity of SUVs was the belief that they were safer. The motorized behemoths’ sales grew at the direct expense of lighter cars which, while efficient on fuel, were vulnerable to heavy damage in higher-speed collisions. On the other hand, SUVs heralded the arrival of personal transportation that, initially, survived collisions better than the lightweights.

Sports Utility or Personal Assault Vehicles?

We have learned that SUVs also have a dark side. Ironically, one of the biggest issues is that they’re – well – BIG! Although SUVs make their occupants safer, it comes with a price.

Construction – SUVs are not only heavier than most private passenger vehicles, they’re also stiffer. SUVs react more like jeeps on wet roadways and on turns. While smaller vehicles may fish-tail under these conditions, SUVs have a tendency to roll over. Further, with their heavier weight and stiffness, SUVs have bodies that don’t have as much “give” during impacts with other vehicles.

Collision – This means that smaller, lighter vehicles that collide with SUVs suffer a higher level of damage upon impact. Naturally, the occupants of smaller vehicles that collide with SUVs face a higher chance of serious injury or death. SUVs have front bumpers that are significantly higher than most vehicles and this can cause big problems. Instead of helping to mitigate the impact by making contact with the other vehicle’s bumper, it maximizes damage because the SUV’s hardest part makes contact with the more vulnerable body of a smaller vehicle. In fact, depending upon its speed, an SUV may actually run over the top of a smaller car.

Increased Liability – The nature of the construction elements of an SUV during accidents with smaller cars result in these types of vehicles inflicting more serious bodily injuries to other operators. This fact leads to more lawsuits against SUV operators. More claims increase the cost to insurers and results in higher insurance rates. In fact, a number of apply premium surcharges to SUVs in order to make up for their greater risk of causing serious accidents.

While SUVs may fit the needs of persons who put a premium on vehicle strength and safety, such vehicles inflict more serious damage on smaller vehicles and their occupants. Further, as the number of SUVs increases, there will be a diminishing return on their safety since the probability will increase that SUVs will crash into other SUVs. In the end, a person interested in buying and driving an SUV will just have to consider the positives and negatives.

Avoiding Road Rage

How likely are you to become enraged while on the road? Emotions have a huge impact on driving. Long before starting your car, you’ve had to wake up, deal with home emergencies, perhaps get your kids moving, and worry about work (including getting there on time).

Now that you’re stressed out by the way your day may have started, your emotions may be fueled by having to deal with a variety of drivers who choose to:

  • Cruise through intersections during a red light
  • Make quick left turns in front of oncoming traffic
  • Change lanes six times in the space of two city blocks
  • Tail-gate so closely that they threaten to weld their car onto your rear bumper
  • Ignore the changing light in order to adjust mascara, shave, eat or comb
  • Pay more attention to their cell-phone conversations

Such folks turn every day on the road into a test of patience and may even trigger a dangerous emotional response.

“Road rage” refers to driving incidents involving aggressive or violent behavior. Various sources have blamed increased traffic accidents and fatalities on road rage. Others debunk the term as a “fad.” and say that traffic statistics don’t reflect increased violence on the part of drivers.

Chances are, most instances of poor driving are isolated incidents. Every driver is guilty of an act that can be blamed on a momentary lapse in judgment. You or I may make a proper lane change or legally proceed through an intersection 99 out of 100 times. However, the drivers who witness our mistakes may assume that we’re hopelessly inept or are doing something deliberate. Take a deep breath from behind your wheel and recognize that the driver who has just done something “stupid” is likely someone who is normally a good driver.

It makes sense to give other drivers the benefit of the doubt. One reason is because it’s earned. Most drivers do a terrific job on the road. Especially when you consider the dangers inherent in driving, such as traffic congestion, poor weather, time-pressures and routine road hazards (breakdowns, potholes, pedestrians, etc.)

A better reason for staying calm behind the wheel is that cool-headed drivers make better decisions. They have a better chance of avoiding or minimizing accidents. Finally, you may run into serious problems if you cause an accident while acting too aggressive. There’s a greater chance of causing serious injury and a higher likelihood of legal consequences. You also increase your chances of being sued. Oh, and let’s not forget that insurers aren’t seeking to cover drivers who fail to use common sense.

Driving is tough enough without complicating it with rude or aggressive behavior and car insurance isn’t free, so start your car, give other drivers a break, and keep a cool head. It’s an attitude that creates the best chance for getting where you need to go….safely.

Liability Insurance Exclusion

Drivers involved in car pools and other group arrangements may wonder if the situation is covered under their auto policy. This concern is valid as many auto policies have restrictions. Typically, liability coverage under personal automobile policies does not apply to “. . . liability arising out of the ownership or operation of a vehicle while it is being used as a public or livery conveyance.” (A public conveyance is a vehicle used indiscriminately in transporting the public without being limited to certain persons or occasions. A livery vehicle is one that is offered for rental). There is slight variation in language among policies issued by various insurers, but the intent is the same, to exclude the use of a personal auto for transporting people or property for income. However, this exclusion does not affect coverage for car pool, driver group, and share-the-ride arrangements. Why Isn’t Coverage Excluded?

Coverage is unaffected because the driving exposure is essentially the same. The common exclusion concerning “public or livery conveyances” is to prevent coverage for situations that involve a commercial or business exposure. Using an auto that is covered by a personal auto policy to transport people or goods for hire is unfair to insurers because, while the insurance company charged a premium based on personal use, “public or livery conveyances” are typically:

  • driven more miles
  • exposed to worse (i.e. high density) traffic situations
  • driven under more pressure to meet delivery schedules
  • exposed to poorer driving conditions

In other words, such use calls for more careful underwriting, different or special coverages and, more important, a higher commercial premium.

However, group-driving arrangements are not significantly different than the routine personal use of a car since personal auto premiums contemplate using the car for commuting, vacations, personal errands, etc. Most car pool arrangements are a form of personal use, so the “personal” premium compensates an insurer for the exposure. Are There Other Coverage Considerations?

Yes. Car owners may worry if their insurance is affected if another member of a car pool is driving their car. The answer is that any person using the vehicle with the car owner’s permission is covered along with the car owner. Obviously, a car pool relief driver has the named insured’s permission, so coverage would still apply.

Persons who drive in carpools may want to discuss the details with their insurance agent. It’s important to discuss the details to make sure that coverage isn’t adversely affected or to be certain that their insurance limits are adequate. An insurance agent may recommend that you carry higher bodily injury liability insurance limits, especially if your policy contains sub-limits that apply separately to injured persons and to the total amount of losses. Higher medical payments coverage limits may also be in order. Providing full details can help an agent make sure that any fees involved in the arrangement represent coverage for the driver’s operating expenses and not additional income. Conclusion

In most instances, the use of a covered car in a typical share-the-ride arrangement or car pool will not compromise or void either the liability or medical payments protection under the personal auto policy. The fact that passengers pay a small amount of money to help cover the expense of automobile operation is unlikely to eliminate their driver’s insurance coverage since the car is not being used as a “public or livery conveyance.”

Insurance consumers should be encouraged by the flexibility of coverage under their personal auto policies. Participation in a car pool does not void automobile liability insurance provided the pool is not operated for a profit. There is no problem when the members of the pool use their respective cars approximately the same amount of time. If one of the members does not share the driving and pays a regular fee, the insurance protection of the owner of a car involved in an accident remains intact. However, any fees received by a driver from car pool passengers should only reflect a reasonable share of the gas and oil expense and depreciation on the car. Do you still have questions about your situation? If so, contact your insurance agent, a professional who’s in an excellent position to provide you with answers.

Does Car Pooling Affect My Personal Auto Coverage?

Why Do We Still Car Pool?

Environmental concerns, traffic congestion, convenience, desire to relieve driver stress, poor public transportation, lack or expense of parking are factors that contribute to commuters forming driver groups or car pools. Parents use such arrangements to transport children to school, sports events and extracurricular activities. It is also common for a student owning a car to carry classmates back and forth between home and school.

Regardless of the name, driver groups, share-the-ride arrangements or car pools are a permanent part of the American scene. Typically, several drivers take turns assuming the responsibility for driving their companions. It’s common for the turns to last a week and may be done on a rotating basis. These people frequently live in the same area and work in the same office or plant, taking turns driving or regularly riding in one car and paying the owner a reasonable fee to help pay for gasoline, maintenance and wear and tear.

The practice of a parent taking a group of children on an outing, to a Little League baseball game, and the like is commonplace. Other examples of group driving exposures are plentiful:

  • church group activities
  • book club members driving to their regular meeting or outing
  • coaches taking players to practices or games
  • employees traveling together to league games or practices, etc.

Auto Policy Exclusions

Having an auto insurance policy shows that you’re a responsible driver. It also means that you’re complying with your state’s requirements for driving on its roadways. However, even if you have auto insurance, there are still instances, called exclusions, when your policy won’t provide coverage. Why should exclusions exist in an insurance contract? There are several different reasons for exclusions:

  • help contain the expense of providing insurance;
  • prevent coverage under one type of policy that should be covered elsewhere (such as a homeowners policy); and
  • prohibit coverage for losses that are against public policy.

Let’s look at these reasons more closely.

Help contain the expense of providing insurance – If your auto policy had to cover every imaginable loss, it would also have an unimaginable premium. Auto insurance is affordable only if insurance companies can exert some control over the losses their policies can be expected to cover. Therefore, automobile policies generally contain exclusions against accidents which involve:

  • injuries caused directly or indirectly by a nuclear weapon, reaction radiation or contamination; or by war, civil war, insurrection, rebellion or revolution.
  • injuries involving any vehicle inside a facility designed for racing while preparing for, or competing in, a race.

The first instance involves losses that are beyond any insurance company’s ability to control and to pay for. The second instance involves losses that are strictly under an individual’s control (so it isn’t accidental). Insurance companies certainly want to avoid situations where their customers choose to put themselves and their cars in an excessively dangerous position.

Prevent coverage under one policy when it should be covered elsewhere – Most automobile policies won’t provide coverage for a loss or injury which:

  • happens while in a vehicle that has fewer than four wheels
  • occurs while the vehicle is transporting persons or property for profit
  • happens while the vehicle is being used as a residence
  • occurs while on the job, and workers compensation coverage is either available or required for the bodily injury
  • takes place while an insured making use of a vehicle he owns or has regular access but the vehicle is not listed on the automobile policy.
  • involves a vehicle that’s being used in an insured’s “business.”

These limitations are fair. Their purpose is to make sure that coverage that you buy for your own car, van or truck listed on your policy does not also handle situations that should be addressed by either another person’s auto policy, a worker’s compensation, a business policy, by a specialty policy (such as racing events coverage) or other types of policies.

Prohibit coverage for losses that are against public policy – Some examples of this reason are when coverage is denied for losses:

  • occurring when the injured person is occupying a vehicle knowing that she or he does not have the vehicle owner’s permission
  • that were fraudulently staged by the vehicle’s owner in order to collect insurance for “phantom” injuries.

Insurance would be impossible to afford if it were expected to pay for injuries to car thieves or people who fake accidents and injuries.

So remember, without reasonable exclusions, you or I would not be able to enjoy the protection and security that is offered by automobile insurance. If you have questions about exactly what is excluded by your policy, talk to your insurance agent.

The Loss Is Only the Beginning

Once a loss takes place, an insurance company has to meet its promise to handle that loss. However, there are some important obligations that a policyholder has to fulfill. These
obligations affect whether an insurer pays the claim. The duties help an insurer to determine whether payment is due or how much it has to pay.

Notification – You must contact the insurance company with accident details. Notification may be through an agent and it should include the identity and addresses of any injured persons
and any witnesses. Quick notification starts the entire claims process, and it helps the insurer to control claim expenses.

Assisting the insurance company – You must help the insurer with the claim’s investigation, settlement or with its defense against any claim. Assistance includes sending the company
copies of any accident-related material. It also means participating in physical exams and interviews under oath. You’re also required to give your insurer access to all records (especially medical) related to the accident and a proof of loss statement (a document that has all loss details and information about the lost property).

Repeated requests for help or information may strain relations between you and your company. While companies have the right to thoroughly investigate losses, it has to balance its right
against your expectation of fair treatment and privacy.

Preserving the damaged property after a loss – Let’s demonstrate this important condition with an example. Tina returns home early in the morning in her convertible and hits a large landscape rock that’s in front of her house. The damage is minor, but the impact causes an alignment problem that makes it impossible to close the convertible top. Instead of moving the car into the garage or covering the car, Tina leaves it in the driveway. It sits there all day, sitting exposed to a downpour that severely damages the interior and the car’s electrical systems. The car now has to be towed to have the damage inspected when, originally, it could have been driven. Tina’s inaction complicates a once simple claim. In this case, the insurer may require Tina to handle the towing charge. The insurer may also either dispute and/or deny the exposure-related loss.

Being too quick can also cause problems. A claimant who repairs or disposes of damaged property before an insurer examination has seriously breached the insurance contract. This breach could result in an insurer refusing the claim.

On the other hand, recent court developments have changed the situation. At one time, a policyholder could endanger coverage by any missed obligation, regardless whether the “miss” was significant. In other words, a technicality could void coverage. Today, courts have started to rule that an insurer has to show that a breach of duty has to harm or prejudice its rights. If
the insured’s action (or inaction) has no effect on an insurer’s position, then it can’t deny coverage.

If you have any questions, your insurance agent is an excellent choice to help you properly understand your insurance policy obligations.

Personal Auto Coverages – Part 2

Cars are expensive to buy and repair, providing great reasons for protecting them. If you borrowed money to buy your car, the lender was likely to make certain that you had coverages to pay for any damage to the vehicle.

Collision coverage – This covers damage to your own vehicle that happens when your vehicle runs into another object, such as other vehicles, trees, light poles, mountains, etc.

Other Than Collision coverage – This also covers damage to your own vehicle that is due to sources such as fire, theft, hitting an animal, vandalism, earthquake, flood or hail.

Unlike liability coverage, both Collision and Other Than Collision coverages are subject to deductibles, the amount of a claim that the policyowner must pay. Deductibles are meant to eliminate an insurer having to pay for very minor losses.

Personal Injury Protection or Medical Expense – This coverage typically handles medical expenses for injuries to you, your passengers or people who are “around” you. It may also cover you and your household if you, as a pedestrian or a bicyclist, are struck by an automobile.

Towing and Labor coverage – This coverage is to help pay for your costs to deal with a disabled car. It could help pay for the car to be towed to a service station or for any repair that occurs at the location of the car’s breakdown. Note that this coverage is for labor rather than the costs of car parts. Available coverage is minimal (often between $25 -$75).

Rental Reimbursement – This coverage reimburses your expense of renting a car as a temporary replacement. The car being replaced must be an insured car that’s unavailable for use because of it being damaged, lost (stolen) or destroyed in a covered loss.

Remember the above information only touches upon some typical auto insurance issues. It’s always wise to contact your agent and discuss your coverage questions and needs in detail.

Personal Auto Coverages – Part 1

A driver who’s unlucky or careless can maim or kill other persons and severely damage or destroy property. This deadly potential is the biggest reason for auto insurance. Most states have financial responsibility laws. They require you to carry proof that you are able to pay for any damage or injury you may cause while driving. Auto insurance is the way that most people comply with these laws. Typically, drivers are required to carry liability insurance at some minimal limit which varies by state.

Bodily Injury Liability – This covers injury that you may cause to other persons. The key is that it involves you being held financially responsible for injuries to other persons because of your driving. This coverage does not apply to your injuries.

Property-Damage Liability – This handles damage that you may cause to another person’s property. Again, the coverage only responds when you are financially responsible for such damage and it has to be related to your driving.

Uninsured Motorist Coverage – This coverage typically pays for damages you suffer from an accident caused by an uninsured driver. Now, be careful with this coverage. An uninsured driver must be responsible for causing the loss. “Uninsured” usually refers to a person who has no insurance; a person who can’t be located (“hit and run drivers”); a person who has insurance but their insurance company is insolvent and other situations (defined by individual state laws).

Important: Payment under this coverage is controlled by the limits mandated by a state’s financial responsibility or specific uninsured motorists law that often dictates what limit or limits must be sold. In some states, you may have an option to reject the coverage. Typically, the rejection must be in writing.

Underinsured Motorist Coverage – Similar to uninsured motorist, it pays for injuries caused by a driver who is inadequately insured. Example: You are seriously injured by someone carrying a bodily injury limit of $25,000, but your injuries are nearly $50,000. Your Underinsured Motorist Coverage limit is $100,000. In this instance, your policy would pay the difference between $25,000 and $50,000.

Remember that this is merely an introduction to complex policy coverages. Be sure to contact your agent for detailed insurance information. Please see part 2 of this topic for information on other, typical auto policy coverages.

Is Your Car Worth Less Than Your Loan?

Car loans and leases used to last no longer than three years. Today, with vehicles now as expensive as small homes, the length of loans and leases has increased dramatically, stretched out to four or even five years.

Whether your vehicle is a coupe, sedan, van, sports utility vehicle, or truck, one thing is guaranteed. Your vehicle’s value will depreciate very quickly. A rapid loss of actual value accompanied by a longer loan obligation spells trouble.

In short order, the amount of the unpaid loan and lease agreement balance becomes much larger than the vehicle’s value and this disparity exists over much of the loan or lease period.

Making matters worse is that this gap is usually only discovered after a total loss. After the insurer pays its obligation, you may have to pay the bank or leasing company thousands of dollars out of your own pocket.

Nobody is to blame for this problem-not the bank, leasing company, insurer or the car manufacturer. The situation is an unfortunate side effect of the need to extend financing to accommodate extremely expensive vehicles. However; there are a couple of solutions to the dilemma.

The Auto Loan/Lease Coverage Endorsement

This optional coverage is available in most states, from a variety of insurance companies. The form provides coverage for the following:

  • Leased vehicles – Reimburses you for the difference between the amount due under the terms of the lease and the actual cash value of the auto in the event of the auto’s total loss.
  • Owned vehicles – Pays any outstanding indebtedness incurred by you for that financed new vehicle in the event that there is total loss or damage to the vehicle and the amount due under the finance agreement is greater than the actual cash value of the automobile.
  • Partial Losses – On partial losses, the company will normally pay to have the damages repaired or parts replaced, and the lease or loan gap coverage option is not a factor in the loss settlement.


Generally this optional coverage excludes items such as overdue lease payments, penalties (for excessive use, abnormal wear and tear, or high mileage), security deposits, costs of warranties or various types of credit insurance, or carryover balances from a previous lease.

Auto Replacement Cost Coverage

For an additional premium, a new car owner may buy coverage to settle major losses based on the vehicle’s replacement cost rather than its depreciated value. There are some limitations such as:

  • the coverage is usually only available for cars up to six months old
  • there may be a maximum dollar amount that applies to a total loss
  • the coverage may only be available for the first few years of the car’s useful life

Considering these limitations, the replacement cost option is more suited to narrowing, rather than closing the lease/loan gap.

If you have a newer vehicle and are concerned that you could suffer a large out-of-pocket expense if your car is totaled, you should talk to a qualified insurance professional to answer your questions. You may find that the extra protection is worth the extra cost.

Custom and Electronic Property

You may be frustrated with car insurance premiums that creep upward with each renewal. Factors that can affect car insurance premiums include the following:

A basic auto policy is designed and priced to only cover certain vehicle features. You might need extra coverage to take care of expensive vehicle options such as custom or electronic property.

Factory Options – While traditional, factory-installed features are covered by an auto policy, manufacturers sometimes jump ahead of insurance policy designers. For instance, when first introduced, theft deterrent car radios (which are disabled when removed from the dashboard) were not covered by many auto policies. It is important to read your particular auto policy to make sure that it doesn’t contain similar coverage gaps.

Dealer Options – Factory installation does not apply to autos that are modified by a conversion specialist or an auto dealer before being displayed for sale. Car dealers frequently add options to make their inventory more attractive to car buyers (and more profitable). Spoilers, body side moldings, special wheels and hub caps, body paint, car phones, speakers and stereos, pin stripes and conversion packages can be added directly onto the dealer invoice. Insurers cannot adjust their premiums for these additional features unless they’re told about them, including how much they cost. If you’re not sure what is original and what has been added, ask your local dealer. If the information on options is not shared with the insurer, the unknown options may not be covered after a loss.

Ignoring the issue means you risk the chance that some of your valuable property may be uninsured. The best choice is to share your information with your local insurance professional. Together, you can take the steps to get the coverage you need.

Youthful Operator Driver Safety Agreement

My Driver Safety Agreement

Driving is a privilege that I may lose by violating this agreement or may have suspended for other reasons such as (but not limited to) unsatisfactory school grades and violations of family trust.

  • I will obey any curfews or restrictions imposed by my driver’s license.
  • I will obey all traffic laws and speed limits.
  • I will not drink and drive, or use illegal drugs, or drive if I am taking ANY medication that may affect my driving.
  • I will not ride with anyone whom I know or suspect is under the influence of alcohol or drugs (legal, or illegal).
  • I will not permit any open or empty containers of alcohol, or transport anyone who I know or suspect may be carrying illegal drugs in any vehicle I operate.
  • I will not ride in any vehicle where I know that there are empty or open containers of alcohol or where anyone who I know or suspect may be carrying illegal drugs.
  • I agree not to drive with or transport anyone who is in possession of a firearm or other “weapon.”
  • I will always wear my seatbelt and shoulder harness. I will not ride in any vehicle in which there are more people than seat belts.
  • I will make certain that I can always hear emergency vehicles and traffic sounds.
  • I will drive defensively, recognizing the driving dangers posed by other drivers.
  • I willI will not transport passengers unless they are properly secured by a seatbelt.
  • I will always wear a helmet if I am driving or riding on a motorcycle. I will not transport a passenger unless he or she also wears a helmet.
  • I will drive in a manner that respects the safety of myself, my passengers, other drivers and pedestrians.
  • I will ignore peer pressure. While driving, I am in control. I can stop and ask others to leave my vehicle and, as a passenger, I can ask a driver to stop and let me out.
  • I will not drive unless I feel safe and certain of my ability.
  • I will be especially alert during dangerous conditions such as rain, snow, sleet, wind, heavy traffic, construction zones, and accident scenes.
  • I will always lock every door and take the keys when I leave the vehicle. I will park in areas where I believe the vehicle will be safe from damage or theft.
  • I will obey the driving instructions of my parent(s) and of law enforcement officers.
  • Additional Conditions Required By My Parent(s)
  • ________________________________________________________________
  • ________________________________________________________________

I have read, understood and I will comply with this agreement.

Signed______________________ Witnessed_________________________


Can I Make My New Driver Safer?

A new driver can send a parent’s stress-level soaring. So let’s focus on ways to control a young driver’s impact on your peace of mind.

Keeping your young driver safer

  • Consider preparing your child with a course in defensive driving as a tool for avoiding accidents and increasing confidence.
  • Require your young driver to understand, sign and comply with the Youthful Operator Driver Safety Agreement.
  • Be a proper model by using seat belts and never using alcohol or drugs.
  • Provide your child with a well-maintained vehicle, equipped with safety devices such as air bags and anti-lock brakes. Also, avoid vehicles that are vulnerable to serious damage during collisions or to “rolling over.”
  • Control your child’s driving privileges…don’t hesitate to curtail or revoke them in response to poor behavior.
  • Set high driving standards and test your young driver.
  • Be certain that he or she can properly pass vehicles, maintain a correct distance, park, merge and exit, change lanes make turns, obey speed limits and be aware of pedestrians.
  • Make sure your child understands traffic laws and has a healthy respect for the power of the automobile.
  • Don’t let your child become licensed until he or she passes YOUR driving test which must include the ability to drive under adverse conditions (dark, fog, rain, ice, snow, rush-hour traffic, etc.).

Another good idea is to talk to an insurance expert about other strategies to keep your new driver safe.

Can I Make My New Driver Affordable?

The cost of your car insurance may double by adding a young driver to your policy. This article focuses on ways to control a young driver’s impact on your insurance premium.

Reducing your insurance premiums

  • Have your child complete a driver training class, balancing its cost against premium savings and gaining a more competent young driver.
  • Ask your insurer if it gives discounts to students with good grades.
  • Find a company that bases its premium on the car your new driver usually drives instead of assigning him or her to the most expensive vehicle.
  • Does your child have to drive to school? If so, expect your company to charge a higher premium for the increased amount of driving.
  • Build a long-term relationship with your insurer. Some companies reward longevity by forgiving a driver’s first accident or minor traffic violation.
  • Make sure your new driver understands that poor driving habits can result in higher premiums or a canceled policy.
  • Increase your physical damage deductibles or, for older vehicles, eliminate this coverage.
  • If your child owns a vehicle, he or she should have a separate policy. However, if you share the cost of the car and its insurance, it may make sense to also own or co-own the vehicle. Your ownership interest lets you take advantage of a multiple-car discount.
  • Think carefully about giving a young driver his or her own car. Coverage for young drivers who have full-time access to a vehicle is very expensive. Make sure you balance convenience against cost.

Important: don’t pursue lower premiums blindly. It’s important that your young driver is protected from the financial consequences of causing a serious accident. Further, you may need to protect yourself since you could also be sued for an accident caused by your son or daughter. You might consider getting higher limits of liability by purchasing an umbrella policy. Talk to an insurance professional about more strategies to keep your new driver affordable.

Controlling Car In$urance

You may be frustrated with car insurance premiums that creep upward with each renewal. Factors that can affect car insurance premiums include the following:

  • Your insurance company’s overall loss experience (due to more claims)
  • The increased value of newer model cars, particularly SUVs
  • Increases in judgment amounts awarded in auto lawsuits
  • Increased business processing and administrative expenses
  • Auto loans lasting longer, meaning increased auto repair costs for older cars

Since these factors are beyond your control, it may be worthwhile to address ways that may lower your car insurance costs.

Begin by gathering your insurance records and any other car-related information. Next, determine if circumstances have changed since you last dealt with your coverage. Once this information is handy, call your agent and discuss relevant items such as:

  • If you have your home and auto insurance with the same company, are you getting a discount?
  • Does my coverage take full advantage of the discounts offered by my company?
  • I have more than one car; am I getting a credit?
  • Does it make sense to change my deductibles?
  • Do my cars really need physical damage coverage insurance? (An important consideration for older vehicles)
  • Do lifestyle choices such as drinking or smoking affect my premium?
  • My son or daughter is on the honor roll, does this affect my premium?
  • Did you know that my car has special security features?
  • Did you know that my son took Driver’s Education?
  • Does the company have accurate information on how often and how far I drive?
  • Am I with a standard carrier or do I qualify for any preferred program?
  • Is my vehicle charged an additional premium because of its type or performance?

Do I qualify for a loss-free history or policy longevity discount.

Giving your agent accurate information helps you get the best available premium. Provide your agent with complete details about your driving history. It’s important to clear about who drives your cars and how they’re used. Finally, use your agent as a resource for handling errors about your account or which may be shown in your driver records.