Tuesday, July 28, 2009

What do you mean I don't have coverage?!?!

The other day a friend came in to my office and asked me to run some quotes for him. Of course I was happy to help out but I was happier to see he had copies of his current policies with him. We took a few minutes to go over some of the basic info so I could get the quotes started and one of the first things I noticed was the his wife was not listed on the policies. I knew he was married and asked why she wasn't listed. He asked me if she should be listed or if it makes a difference. To which I responded, YES, YES, YES IT MAKES A BIG DIFFERENCE!

When insurance companies/agents write a policy for an insured there are some very basic things that should always be done to make sure the policy will cover you the way it is supposed to. One of the most basic is always listing husband/wife, engaged couples, or long time partners together on the policy. This ensures that both people who own the property have all of the rights of a named insured. What does this mean for you? If you and your spouse own a home and it burns to the ground, the first thing the insurance company does is pull out their copy of your policy to find out who gets the money. You might have a mortgage company who needs to get paid but aside from that, the money goes to the named insured, i.e. the person listed on the front of the policy. In that same home you may have someone get seriously injured and sue you for their injuries. Again, your company will look at your policy to decide who they need to defend for that lawsuit and the first place they look is the named insured.

So if your spouse isn't listed does he/she have coverage? Yes and no. Every policy I have ever worked with will define "you" as "The named insured shown in the Declarations and the spouse if a resident of the same household". So as long as your spouse is a resident of the house there is coverage. However, if they move out of the house temporarliy for whatever reason, divorce, seperation, has to work in another state for her employer for an extended period of time, they are no longer a "you" and don't get coverage.

Luckily there is a very simple fix. List both you and your significant other on all of your insurance policies, home, auto, boat, umbrella, etc. This way you won't have to worry about it.

Monday, July 20, 2009

Auto Insurance soon to be mandatory in Wisconsin

In case you missed it, the Governor's budget had a few lines regarding auto insurance when it was passed. Basically starting June 1, 2010 every car on the road in Wisconsin will be required to be insured. Some people don't realize that Wisconsin is one of only two states that don't currently require auto insurance, but starting next year that will all change. You can read all of the details in a Journal Sentinel article http://www.jsonline.com/business/51147942.html. In addition to requiring auto insurance, the budget also requires the minimun insurance requirements to be increased over the next few years.

I have had a few discussions with clients asking me what this will mean for their insurance premiums. In my opinion, it means premiums are going up. If you increase the minimun requirements for everyone then the people with the lowest liability limits are going to need to increase their coverage. Some will decide the increased cost for the new higher limits is too expensive and decide to risk it and not carry any insurance. So the number of uninsured drivers goes up. With more uninsured drivers there are, the more claims that go unpaid increasing everyone's insurance costs. In addition to an increase in the number of uninsured drivers, the insurance companies are also going to see more people buying policies and not keeping them in force. How does this increase costs? Basically an insurance company looks at a new policy as a long term investment. The cost to start a new policy, go through underwriting, issue the policy etc is where the majority of the cost comes for the company. They anticipate the policy will stay in force for 3 years which is about when a company breaks even on a policy, depending on the claims of a client.

Overall, I really disagree with the idea of the government stepping in to make decisions for people. As an agent, I counsel my clients to carry the limits appropriate for their life, family, budget, etc. This is the job of the insurance professional, not the State of Wisconsin. I would love to have every person in Wisconsin insured properly but that is a little utopian in my opinion. The costs associated for the insurance companies and the State of Wisconsin will far outweigh the benefits of a few more people carrying insurance. In fact, the article points out that mandating insurance does not mean an increase in insured motorists. Obviously we are going to have to wait and see what happens with all of the new rules but I am going on the record now as being firmaly against these changes, not just for my agency but for my clients too!

Friday, July 17, 2009

Call me with Google!

I just added a great feature to the blog, Google Voice. If you want to get ahold of me but are not certain if you should call the office or my cel, now you can just dial one number and it will find me! If for some reason I still can't take you call you can just leave a voicemail and it will send me an email with the message right away.( I have a smartphone so I will get the email right away too) Try it out next time you need to get in touch with me, it is a neat piece of software!