10 Ways to Beat the High Cost of Auto Insurance (Part 1)

(the SECRET from the ad is marked with 3 stars (***) in Part 2 of this article. This first part is pretty good though... :) )

Insurance has been one of the necessary evils of life for over 100 years. In this day of higher taxes, rising food prices and soaring housing costs, it is possible for you to get a handle on your own auto insurance costs. If you have been frustrated by an inattentive agent and constantly rising insurance premiums, this is the book for you!
Insurance can be complex and technical. Some people are paralyzed by simple buying decisions. Should I have collision coverage on my 15 year-old car? Would it make more sense to have a $500 deductible instead of a $100 deductible? Since I have adequate medical coverage at work, do I really need medical coverage on my car insurance as well?

I will show you how nearly all of your auto insurance-buying decisions can be simplified by answering 3 simple Test Questions.

With the overall cost of living swelling up around us, and insurance taking an increasingly larger portion of our income, it is important that we leave no stone unturned in controlling our insurance dollar! During the period from 1970 to 1990, auto insurance costs rose 40% faster than the overall cost of living. With this kind of increasing burden on your already stretched consumer dollar, it is imperative to get a handle on the auto insurance portion of your budget. One of the most important parts of your strategy is your agent and the working relationship that you share.
Sometimes, a newer agent will be energetic and willing to take the time required to effectively manage your insurance portfolio. But the newer agent may lack the experience required to exercise all of the potential money-saving applications available. Your agent must be experienced enough to know the ins and outs of the rating rules of the insurance company. Each company has rating and underwriting rules that, if properly applied can save you big dollars on your premium.
Your agent must also be willing to invest the time required to orchestrate your insurance portfolio. Older and more experienced agents generally know all of the little tricks but lack the drive and initiative to be of any real help to you. Some of the methods described below require personal and concerned attention. Agents that are too busy to sit down with you and devote the kind of time required to milk every ounce of protection out of your insurance dollar do not deserve your business. If your agent is hard to reach or doesn't appear to be giving you a 100% effort, don't give him or her even 1% of your insurance money!
Find another agent!
There are agents out there that have the right blend of experience and availability for you. Don't sell yourself short here! You should be as willing to spend the time necessary to find a good agent as you are to shop for a competitive price. Furthermore, you must be willing to be ever vigilant in the management of your auto insurance. As you will see in the methods below, each time any part of your life changes, it may require some change in your insurance coverage. Each time one of these changes occur or when you receive your renewal statement, take a moment to consider your current needs verses your current coverage. The longer you wait between review sessions, the more money you may be needlessly giving the insurance company. When your renewal bill comes due, DON'T BE CAUGHT SLEEPING AT THE SWITCH !

TAKING YOUR FINANCIAL PICTURE -

Insurance is simply the management of risk. Owning and driving an automobile is a risk. You risk injury, loss of your vehicle, and potential liability for damage to others. The purchase of insurance is merely an agreement with the company to transfer some of your risk to them. You are saying, "I choose not to assume all of this risk myself. In exchange for my premium dollars, the insurance company will suffer some of the financial loss instead of me." With this thought in mind, you must decide how much risk to transfer and in doing so, decide how much risk you are willing to keep yourself in the from of deductibles and unpurchased coverages.
Before we can get to ways to save money on your premium, you need to take a short inventory of your financial picture. Before you get to deciding whether to take a $100 or a $500 deductible on your collision coverage you first need to decide that you can reasonably handle a $500 loss. So before we jump into any tricks of the trade, lets take a moment to diagnose your "loss threshold."
Lets say you go out and buy a $3 picture to hang in your bathroom. Are you going to insure it? Of course not! Now you go out and buy a famous $252,000 masterpiece painting. Are you going to insure it? Unless you are a multi-millionaire, you certainly will. Somewhere in between the $3 print and the $252,000 masterpiece is your loss threshold. Your loss threshold is the amount of money you can stand to lose without doing any great harm to your daily lifestyle or your peace-of-mind. In the above example, different people will have different thresholds. There is no right or wrong answer here!
In addition to settling on your personal loss threshold, it is important to consider your previous history of insurance losses. If you have had several losses in the last 10 years, you may be wise to lean more heavily on your insurance coverage. If, on the other hand, you go almost forever between losses, you will save premium dollars by assuming more of the risk yourself in the form of higher deductibles or dropped coverages. Now, if assuming this extra risk is going to give you some sleepless nights and make you a nervous wreck every time you get into your car, then don't do it! Part of what you buy in the purchase of insurance is peace of mind.
What matters most is where you are comfortable. Take a moment to apply a value to your "Loss Threshold." Try thinking in terms of $50, $100, $250, $500, and $1000. How much money can you, with peace of mind, place at risk? As you will see below, once you determine your Loss Threshold, you need only to weigh the cost of the coverage versus the potential for loss to you. Insurance can be a reasonably simple commodity to manage.

1. DROP YOUR COLLISION COVERAGE-

So you have been driving "Old Betsy" now ever since Noah was working on his boat. To you, its worth every bit of what you may have paid for it way back when but to another car buyer, its just an old bucket of bolts, rubber, faded upholstery. Unfortunately, the insurance company views your precious 4-wheeled family member with the same cold business approach as a prospective buyer. Its only worth...well, its worth a lot less than you would hope.
There comes a time in the life of almost every car when its value does not warrant the cost of collision coverage any longer. Collision coverage is that portion of your insurance that pays to fix damage to your car suffered by a collision. You will need this coverage for your car when you are in an accident that is your fault or if your car is the victim of a Hit & Run accident. Looking back to your Financial Picture we discussed above, compare the cost of your coverage with the potential for loss.
In discussions with your agent or by examining your renewal bill, identify the annual cost of your collision coverage. By looking in the newspaper or car-trading publications, determine the actual retail value of your car. Be careful to be objective here and remove whatever emotional attachment you may have to your car that might unrealistically increase its perceived value.

Let's say that the real value of your car is $1200 and the annual cost of just your collision coverage with a $100 deductible is $150. Now here are the Test Questions:

1. Can I afford to withstand this loss without any help from the insurance company? (in this case $1200)
2. Would I rather save $XX (in this case $150) every year and risk the loss of the car myself? By not getting this coverage I am saving $XX ($150) per year. I will save enough to make up the loss ($1200) in Y (8) years. (1200 � 150 = 8)
3. Does my driving and claim history lead me to believe that I might go Y (8) years without suffering that sort of loss?

If the answers to these questions are yes, then you might be well on your way to cutting your insurance costs by dropping your collision coverage. These simple Test Questions can be applied to virtually any insurance-buying decision. Take a look at the next example.

2. DROP YOUR COMPREHENSIVE COVERAGE -

Comprehensive coverage like collision coverage is designed to protect your car from loss. Much of the same logic that we applied to collision coverage can be used to decide on the fate of your comprehensive coverage. There are, however some important considerations to weigh in your analysis.
Comprehensive coverage covers almost anything that happens to your car except collision. The most commonly submitted claims are broken windshields, stolen hub caps, stolen stereos, vandalism and theft of the entire vehicle. Note here that many of these losses produce the same amount of financial loss regardless of the value of the car. It costs virtually the same to replace a windshield in a 75 Ford as it does in an 85 Ford. Consider also that the cost of comprehensive coverage is much less than collision coverage. The ratio between money saved and dollars put at risk is smaller and therefore you may be less eager to drop this coverage. Ask yourself the Test Questions that we did for collision coverage and make an informed decision.
If your vehicle is financed or leased, always remember to check with your financial institution before changing these coverages. Your loan contract may have certain requirements and deductible limitations that somewhat restrict your options.

3. RAISE YOUR DEDUCTIBLES -

If deleting collision and comprehensive coverage puts you at greater risk than you are willing to assume at this time, you may want to consider increasing your deductibles as a compromise. As you increase your deductibles you decrease your premium. The insurance company is going to give you a break on your premium here for two reasons. First, when you have a loss, the insurance company will pay you less money when you have a higher deductible. Secondly, with a higher deductible, you will have fewer claims that are presented to the insurance company in excess of your deductible.
When you take a higher deductible you are saying that you, for the consideration of a lower premium are willing to assume a greater portion of the loss yourself. You trade the certainty of a lower premium for the uncertainty of more loss to you should a claim occur.
If you have decided in your Financial Picture that you are comfortable with a $500 loss (and the premium savings is enough) and you own a car worth $3000 then you probably do not want to drop your collision coverage completely. But you can increase your $100 collision deductible to $500 and your zero comprehensive deductible to $100. Let's examine the numbers. If you save $30 per year on your comprehensive coverage and $65 per year on your collision deductible you realize a $95 per year savings the first year and every year thereafter. You are only increasing your risk by $100 on the comprehensive coverage and by $400 on the collision coverage. Remember you already had a $100 deductible on collision and increasing it to $500 changes your participation in the loss by $400. Again, ask yourself the same questions.

1. Can I afford to withstand this loss (the bigger deductible) without any help from the insurance company?
2. Would I rather save this money ($95) and risk the larger deductible loss myself? By taking this bigger deductible I am saving $95 per year. I will save enough money to make up the loss in one year for a comprehensive loss and in just over four years for a collision loss.
3. Does my driving and claim history lead me to believe that I might go one or five years without this sort of loss?

You may be beginning to see that insurance is not all that difficult! If the answers are primarily yes then most likely an increase in deductibles is right for you.

In Part 2, we'll examine the rest of the 10 Ways to Beat the High Cost of Auto Insurance.

It's a Good Life !

Dennis Volz, Agent
10783 Jamacha Bl, Suite 1, Spring Valley, CA 91978
OFFICE: (619) 670-1000 - FAX: (619) 670-1121 - Cell (619) 339-1339
Email: Dennis@DennisVolz.com
Websites: Company Site: DennisVolz.COM, Client Convenience Site: 6701000.com

My 'Other Blogs'

Working by Referral

Musings from California

Homeowners Insurance - HOW TO CLOSE YOUR ESCROW -- How to buy it, How much to get, and HOW TO SAVE MONEY

The informed purchase of your homeowners insurance can be the most important minutes you invest into the purchase of a home.

So, you've purchased your new home, navigated the rigors of escrow including home inspections, termite tenting, title searches, legal wrangling, paper work, signatures, delays, changes, lost documents, unreachable loan officers, and the dog ate my disclosure!

Then you get the call..."I'll need a copy of your homeowners insurance to close escrow TOMORROW!"

So now what ?

If you've done the following.....YOU WON'T EVEN GET THE CALL! EVER!!!!!

There's a few simple steps you can take to avoid this last minute panic.

1. Contact YOUR insurance "team member" you trust EARLY in the escrow (like the day you open). (he is a member of your team that helps you avoid ulcers during escrows.)
2. Your agent then gets completely ready w/ the information, inspects the house, relays his information (phone, fac, etc) to escrow and waits. (Check to make sure he's going this. Sometimes escrow contacts him when there's like 20 minutes left till the rate lock expires....) Make sure he's all "warmed up" and ready to go just like the pitcher in the bull pen.

What should you look for.

You need to primarily consider 3 major points of the insurance. (there's MUCH more to it than this and you can read about that HERE.) This is just a quick peek at the basics of what you should look for.

1. INSURANCE TO VALUE - HOW MUCH? People need to insure their homes to the COST OF CONSTRUCTION of the home. Not the sales price, not the loan amount, but the amount of money it would take to rebuild in the case of a total loss. Living thru the TWO MAJOR SAN DIEGO FIRES in 2004 and 2007, I can tell you that this can be a PROBLEM. Get insured correctly going in the front door and the renewals should increase to keep pace (but check 'em out anyway...that's why they mail you an annual renewal notice.)
2. Get a good amount of Liability Coverage. This is the , GAWD, I'M GETTIN SUED coverage. Think minimum of $500,000 and maybe even a $$MILLION$$.
3. Don't take too low a deductible. Many clients take $2000 up to $5000 and even $10,000 deductibles for substantial reduction in their premiums. Look at the numbers and decide.

That's just a short view of the INSURANCE portion of your escrow. Most important, get an insurance agent you trust that will take good care of you and who will get to know you BEFORE he recommends coverage. Everybody's different with different insurance needs.

Find an agent that you can call who is willing to spend the time with you to be SURE you new home is adequately and COMPLETELY insured!

It's a Good Life !

Dennis Volz Insurance Agency
10783 Jamacha Bl, Suite 1, Spring Valley, CA 91978
OFFICE: (619) 670-1000 - FAX: (619) 670-1121

eMail:mailto:Dennis@DennisVolz.com

Websites: Company Site: DennisVolzInsurance.com

Client Convenience Site: 6701000.com

My 'Other Blogs'
Working by Referral
Musings from California

Insurance Claims Secrets - The INSIDE STORY

Insurance claims can be a first class PITA!

With that in mind, this little bit of INSIDE INFORMATION is offered.

EVERY CLAIM HAS:

1. An Adjuster (human type)
   
2. A File (either electronic or paper or both)
3. A Supervisor (also the human type)

The claim process looks like this (considering the three above items)

1. The Adjuster mediates and calculates the value of the claim. (Why? Because that's what he's paid to do)
   
2. The Adjuster documents The File. (Why? Because The Supervisor is going to check that file)
3. The Supervisor reviews the file. (Why? Because once a year, the state insurance commission will audit the insurance company and randomly review claim files to be sure that the money paid out was justified, documented and in accordance with state insurance law. When there's an issue, the insurance company is fined -- HEAVILY! )

Here is the extremely valuable information ! When you're negotiating with the insurance company to settle your claim, remember while making you happy is important to them, passing the eventual audit is more important. A badly documented or poorly calculated claim can cost the insurance company -- MANY MORE DOLLARS than giving you a couple hundred extra for your bent fender.

Generally, the adjuster does not personally care how much they pay to settle the claim. Let me say that again.

Generally, the adjuster does not personally care how much they pay to settle the claim.

I say generally because you will occasionally run into that young buck, fresh out of 'ADJUSTER SCHOOL" who wants to save the world and treats the insurance company money like his own. THAT'S a discussion for another day. They're paid employees with families, bills, problems, vacation plans, and a host of other issues just like you and I face everyday.

The claim adjuster doesn't really care what he pays to settle the claim.
The claim adjuster wants to get the file closed as much as you do.

As long as he can document the amount paid, he'll write the check now and be done with it.

THEREFORE......

Whatever assistance you can offer to document a better value for your claim, the faster you'll get paid.

1. When you think your car is worth more than they're offering, get some documentation that supports that additional value.
2. When your repair job exceeds the insurance company estimate, get a letter or itemized estimate explaining the difference.
3. When the replacement cost of your kitchen exceeds what the insurance company is willing to pay, get pictures of your old kitchen and an itemized bid from the contractor that clearly indicates that you're putting yourself back as you were -- No better, no worse.
4. When the 'facts of the accident' are not clear, get witness statements or police report clarification.

The more you're willing to work WITH the claim adjuster to properly document their file to justify higher payments, the more you'll get paid for your claim.

Contact me if I can help you in any way.

After all..... it's what I do.

It's a Good Life !

Dennis Volz Insurance Agency
10783 Jamacha Bl, Suite 1, Spring Valley, CA 91978
OFFICE: (619) 670-1000 - FAX: (619) 670-1121

eMail:mailto:Dennis@DennisVolz.com

Websites: Company Site: DennisVolzInsurance.com

Client Convenience Site: 6701000.com

My 'Other Blogs'
Working by Referral
Musings from California

Whose Insurance Does What during "DELAYED POSSESSION"?

Got this great question from Jennifer Allan, author of Sell With Soul today and thought the answer might be helpful.

Hey Dennis...

What's the deal when a home sells and closes, but there's a delayed possession - that is - the seller retains possession of the property for a few days past closing to move out?

If there's damage... which homeowners policy pays? The buyer's (who owns the property, but hasn't yet taken possession) or the seller's (who no longer owns the property)?

J

WOW! Great questions, Jennifer.

Homeowners insurance for the buyer goes into force to close escrow. After the closing, the BUYER owns and insures the house. Should there be damage to the home, it would fall on the BUYER'S insurance to cover the loss. The new owner would be responsible to pay the deductible. (there could be some stipulations in the RENT BACK AGREEMENT about that, but without some agreement to the contrary, that's how it would likely settle out.)

Loss to any contents of the SELLER (those items remaining while they move out) could be covered one of two ways.

1. Using the homeowners insurance for THEIR (the sellers) new home
2. Using Renters Insurance if they're moving to a rental

Most insurance companies offer at least 30 days of "EITHER PLACE" coverage. In other words, their stuff can be covered by their existing policy for up to 30 days in the old OR the new location. So if they're moving to another home, they will have homeowners insurance in place on that new home. If they're moving to a rental, they need to roll their old homeowners insurance over to RENTERS INSURANCE for the new residence at the close of escrow, In either case, the EITHER PLACE coverage still applies using the new insurance policies to cover their contents during moving.

If you have any questions, please call, write, email, signal flags, or smoke signals.... :)

p.s. My insurance company, which is available nationwide, offers additional location coverage without a time limit. In other words, your stuff is covered anywhere in the world -- PERIOD. Doesn't matter if you're moving, storing, vacationing, or stocking your Ski Chalet in Switzerland.

Point here being that not all insurance companies handle this situation exactly the same. Check with your local insurance professional to be sure.

It's a Good Life !

Dennis Volz Insurance Agency
10783 Jamacha Bl, Suite 1, Spring Valley, CA 91978
OFFICE: (619) 670-1000 - FAX: (619) 670-1121

eMail:mailto:Dennis@DennisVolz.com

Websites: Company Site: DennisVolzInsurance.com

Client Convenience Site: 6701000.com

My 'Other Blogs'
Working by Referral
Musings from California

I've had a FIRE! What do I do now?

Fire can be one of the most traumatic and devastating losses anyone can experience.

If you've had a fire and there were injuries or a death, my sincere condolences. If you've experienced just loss to property, please take a moment to be thankful that there we no injuries or death.

You're probably still in shock that this has happened to you and bewildered by the seemingly endless task ahead of you. This is going to be a ONE DAY AT A TIME process. If you can settle into that thinking, this will be much easier. Every day that you make progress toward rebuilding your life is a WIN. Ask yourself at the start of each day, "What does WIN THE DAY look like TODAY?" Make a VERY SHORT list of a few things that will get you to that WIN THE DAY feeling and be happy with that.

FIRST THINGS FIRST
If your loss is a severe one (a total loss or one where SUBSTANTIAL work is required to get you back into your home) then you need to first think about some long-term living arrangements.

This should be your first priority. You might be put up with friends or in a hotel at first and you may need to get some basic items like clothing, personal items (toothbrush, etc) but don't get involved with any other stuff until you're settled into where you're going to live.
Your insurance company should be very generous here. You can usually rent a place similar to yours at their expense. They won't pay you any extra though.

For example, if you were renting a house or apartment, you won't be required to pay rent while you're out of your home, so you'll just be paying rent someplace else. The insurance company might make up the difference if there's nothing available similar to yours. The goal is to keep your monthly expense about the same.

If you owned a house, you'll still be responsible for your mortgage so the insurance company should pick up the entire cost of renting another place.

Just rent some furniture for now and then SLOWLY, replace it with items you purchase along the way. You'll have plenty of time to shop for furniture once the contractor gets busy rebuilding your home.

OK. So now you have a "home base" from which to rebuild your life. Its important to have this so you can focus on gathering, replacing, purchasing the things, memories and items necessary for daily living.

DON'T BE TOO HASTY TO "HIRE" THE SERVICES of a 'PUBLIC ADJUSTER'. This is someone who will show up EARLY. (like while the fire department is putting the hoses back on their truck) They will tell you that they will do all the negotiating with the "big bad" insurance company for you for a small fee. SAY NO FOR NOW.... (you can always go to them later and their "small fee" is THOUSANDS of dollars....) You're better of without them.

Your claim adjuster is going to be your new best friend. That's an important mind-set to adopt. Look to him as a source of information, encouragement and ideas to get the most out of your insurance policy. The company I'm with (and most companies) will look for ways to BE ABLE TO PAY YOU rather than looking for ways to get out of paying you. Remember, losses are calculated into what they charge and a good claim experience and positive results serve them much better than saving a couple thousand dollars by nickel and diming you to death.

GET ORGANIZED
TAKE NOTES. You should pick up a 3-ring binder w/ some paper. You might want to get some tabbed pages to keep track of THINGS TO DO, NOTES ON CALLS, CONTACT INFORMATION, etc. Remember think MARATHON not SPRINT. You're going to need a central location (the notebook and maybe a small file box) to keep track of your information.

They're going to start by giving you an overview of the entire process. There will be a contractor to find, plans to draw up, lists to create, receipts to keep, and plans to make. Take good notes and remember to keep thinking 'just one day at a time.'
KEEP YOUR PERSPECTIVE AND HAVE FUN! Yeah, I know that sounds a little off. But this is such a once-in-a-lifetime opportunity. You get to start all over. Fresh! New!

Make a decision to enjoy this process -- This curve ball that life has thrown your way. If you're married you can play 'newlyweds' all over again. If you're single you can make a substantial change in your lifestyle, your look, anything you want.

Decide to be BETTER not bitter because of it.

Yes.... Make a conscious decision that this is probably one of the most exciting adventures you'll ever have. Get just a few things and relish in how simple life can be. You'll "clutter back up" soon enough so just enjoy the spartan simplicity.

Buy a different brand of underwear, splurge on some really plush socks, or get a pair of just THE COOLEST JEANS EVER! Try out new ways of cooking with new dishes. Get back to enjoying the simple things in life. You'll be a bigger and better person because of it.

Don't forget to let your friends help you. You'll deepen your relationships and forge new friendships along the way. Just let it all happen.

THOUGHTS ON REBUILDING
There's way too many variations and possibilities to go into within the scope of this blog. But here's a few things to think about as you begin to work with your adjuster and contractor.

1. The insurance company will generally pay to build the house just like the one you lost but YOU DON'T HAVE TO BUILD IT THE SAME WAY. If you've always wanted a big picture window on the west side... then GET ONE!
   
2. Take your time with your architect or making your own sketches of how you want your house rebuilt. You might even be able to change the "footprint" of the slab (the basic shape and orientation of the house) One of my clients who lost their home in the San Diego fires of 2003 had always lamented that the side of the house with the best view had just one little tiny window. Well.... They fixed that w/ 4 huge picture windows and instead of having the bathroom there, it was their den and fireplace area. Turned out BEAUTIFULLY!
   
3. Have a plan to refurnish your home. Just slowly replace your rented furniture with your new stuff as the "building the home" process unfolds.

The process of rebuilding your home can be the most challenging event you've ever experienced. It can also (at the same time) be the most rewarding and life-changing! After all, if you can survive this, sitting in traffic or having to replace your refrigerator just won't phase you any more.

Contact me if you have any questions.

It's a Good Life !

Dennis Volz Insurance Agency
10783 Jamacha Bl, Suite 1, Spring Valley, CA 91978
OFFICE: (619) 670-1000 - FAX: (619) 670-1121

eMail:Dennis@DennisVolzInsurance.com

Websites: Company Site: DennisVolzInsurance.com

Client Convenience Site: 6701000.com

My 'Other Blogs'
Working by Referral
Musings from California

A word about DEDUCTIBLES...

Simply stated: A deductible is the amount that you pay toward a loss or claim before the insurance company begins to pay. The higher your deductible, the lower your premium.

• The more you are willing to participate in your loss, the greater the savings on your premium.

The insurance company will offer your a lower premium if you take a higher deductible because your LOSS FREQUENCY and your LOSS SEVERITY will be lower. Consider if you have a $2000 deductible instead of a $500 deductible:

1. You'll make fewer claims because you won't be making claims for $600, $900 or $1995 losses. You'll simply pay those yourself. (FREQUENCY)
2. When you do submit a claim the insurance company will be paying $1500 LESS than if you had the $500 deductible. (SEVERITY)

There is no "correct" deductible to choose. It depends on what I like to call your personal LOSS THRESHOLD. So before we get too far ahead, lets take a moment to diagnose your "loss threshold."

Lets say you go out and buy a $3 picture to hang in your bathroom. Are you going to insure it? Of course not! Now you go out and buy a famous $252,000 masterpiece painting. Are you going to insure it? Unless you are a multi-millionaire, you certainly will. Somewhere in between the $3 print and the $252,000 masterpiece is your loss threshold. Your loss threshold is the amount of money you can stand to lose without doing any great harm to your daily lifestyle or your peace-of-mind. In the above example, different people will have different thresholds. There is no right or wrong answer here!

ANOTHER SIMPLE CALCULATION....

OK. Let's say you're ok with a loss threshold of $1000 or less. Now you can choose between a $1000 deductible or a $500 deductible. Here's all you have to do.

1. Find the premium difference between the two.
2. Let's say you save $80 a year in premium to take the $1000 deductible.
   
3. Now look at the DIFFERENCE between the 2 deductibles which is $500. It would take you over 6 years ($80/yr x 6 years = $480 ) to save the DIFFERENCE between the deductibles.
   
4. Now you simply ask yourself, "Do I think I'll have more than 1 claim in the next 6 years?"
   
5. If the answer is yes, you should probably take the lower ($500) deductible.
   
6. If the answer is no, then the higher deductible ($1000) probably makes more sense.

If you're still confused by this, just give me a call and I'll walk you through it....

It's a Good Life !

Dennis Volz Insurance Agency
10783 Jamacha Bl, Suite 1, Spring Valley, CA 91978
OFFICE: (619) 670-1000 - FAX: (619) 670-1121

eMail:Dennis@DennisVolzInsurance.com

Websites: Company Site: DennisVolzInsurance.com

Client Convenience Site: 6701000.com

My 'Other Blogs'
Working by Referral
Musings from California

A few thoughts on PROPERLY insuring your Rental Property

So, you're going to be a landlord! Since it's nearly ALWAYS a good time to buy real estate, you're making an excellent move. The long-term value of real estate from an investment standpoint is, in my humble opinion, the best leverage available.

Now that you've taken that step, it's important to get the right kind of insurance to protect not only your investment from the ravages of fire, vandalism, smoke, and broken water pipes, but also protection from the greedy hands of your tenants should they sustain an injury on your property in the form of Liability Coverage.

There's usually 4 primary areas of coverage you want to explore when looking into insurance for your property that you rent to others. (doesn't matter if it's a single family dwelling, duplex, multi-plex or a condo.

1. Building Coverage - Protection for the structure.
2. Personal Property Coverage - Protection for the contents of the unit that you own. This includes refrigerator and window treatments primarily. It would also include any other non-building type items that you own and are stored or used in the rented dwelling.
3. Loss of Rents Coverage - This pays your fair market rent value to you whenever your property is rendered uninhabitable from a covered loss.
4. Liability Coverage - This is that important coverage that protects you when tenants or their guests are injured or sustain some "other kind" of "loss" that they think is YOUR FAULT and they come after you with vengence and an attorney!

There's other coverages to consider like Medical Payments (usually included), Flood and Earthquake Coverage(BOTH usually NOT included).

Ok so now you at least have a place to start. Let's take a quick look at each one to give you just a little guidance.

BUILDING COVERAGE
This coverage is identical to homeowners insurance in that it protects the building against physical loss from perils like fire, smoke, vandalism, water damage from broken appliances and pipes, falling trees, automobiles, etc. It's usually written on an ALL RISK basis. Which is fancy insurance talk that simply means EVERYTHING except certain listed exclusions is covered. In other words, if something happens to the structure and it's NOT listed in the exclusions... IT'S COVERED!

You'll want to get enough coverage here to rebuild the structure at current construction costs. Ask your agent of a general contractor what current constructions costs would be for a place like yours. For a more complete discussion, read HOW MUCH HOMEOWNERS INSURANCE DO YOU REALLY NEED (the section on the building coverage walks you thru the same thinking you'll need to determine coverage on your rented property.)

PERSONAL PROPERTY COVERAGE
This portion provides coverage for items that you likely brought to the property. (Exception here might be a refrigerator or window treatments) Rule of thumb is that if it's permanently part of the structure it's a building item, if not, it's likely a personal property item. Most window treatment items (curtains, blinds, curtain rods) will be personal property (check with your agent to be sure) Refrigerator is personal property. An installed dishwasher is likely a building item.

Usually you don't need too much coverage here -- $2000 to $5000 is usually enough, but add your stuff up to be sure.

LOSS OF RENTS COVERAGE
This is important to provide a consistent flow of income should you sustain damage to the property that renders it uninhabitable for a period of time. Policies can pay for up to 12 or 24 mos or some offer an indefinite period of time. Usually it's just for a short time like a few days or a week or two.

LIABILITY COVERAGE
This could be one of the most important decisions you make regarding your rental property insurance. My advice is to think of $1 Milliion as a minimum. The difference between $300,000 and $1 million is likely less than $100 per year ($8.00 per MONTH) Beleive me, a WISE investment in the protection of EVERYTHING you own. Liability losses can be wide ranging and EXTREMELY varied in nature.

Here's a quick story about one...

Just this year a policyholder called me and told me that they were being sued because their tenant's girlfriend accidentally let the tenant's dog out of the back yard. The dog made a beeline across the street and kicked the stuffing out of the neighbor�s dog. The landlord (NOT the tenant or the girlfriend) was being sued by the neighbor for veterinarian bills that exceeded $3000 and for mental anguish, stress, and� well, you know the drill. Fortunately my policyholder had not only their Rental Dwelling Insurance in place but also a $1 Million Liability Umbrella standing between this crazy neighbor and everything they owned. Without that, this could have been their problem�

They could have been paying off this �little problem� for years. They could have risked everything they own in addition to their FUTURE EARNINGS by not having the foresight to get adequate Rental Dwelling Insurance and a LIABILITY UMBRELLA policy.

You can insure your rental property, your personal property and your liability exposure in one simple policy.

Be sure to take your time and spend a few minutes in the chaos of the transaction to talk with your insurance professional about these important coverages.

You can always call or email me if you have any questions.

It's a Good Life !

Dennis Volz Insurance Agency
10783 Jamacha Bl, Suite 1, Spring Valley, CA 91978
OFFICE: (619) 670-1000 - FAX: (619) 670-1121

eMail:Dennis@DennisVolzInsurance.com

Websites: Company Site: DennisVolzInsurance.com

Client Convenience Site: 6701000.com

My 'Other Blogs'
Working by Referral
Musings from California

FAQ's California Wireless Law effective July 1, 2008

NEW HANDS-FREE CELL PHONE LAW IS EFFECTIVE 7/1/08.

California finally catches up to what's safe and realistic by enforcing a requirement to use cell phones while operating a motor vehicle with either a wireless or "wired" ear piece. Soon we'll all look like Spock and Lieutenant Uhura from Star Trek with those funny "listening devices" protruding from our ears.You can check out the Official FAQ's at the California Department of Motor Vehicles website, but here's my personal spin.

There will be no grace period. That sounds like really bad news, but it doesn't count as a "real ticket" and the fine for the first offense is only $20.

If you're under 18, you can't talk on the phone AT ALL while driving. This includes talking AND texting. HOORAY! (interestingly, the law doesn't specifically address texting by over 18 operators.

Speaker option is OK. Push to talk is NOT. I guess HANDS FREE means just that.

Calling 911 in an emergency situation is an exception. Makes sense to me.

Good luck. I think this is a law that's LONG OVERDUE and should be enacted in all states. The ONLY accident I've been involved in my last 25 of driving was when I was rearended while stopped at a light when a young girl was REACHING FOR HER CELL PHONE and took here eyes off the road.

It's a Good Life !

Dennis Volz Insurance Agency
10783 Jamacha Bl, Suite 1, Spring Valley, CA 91978
OFFICE: (619) 670-1000 - FAX: (619) 670-1121

eMail:Dennis@DennisVolzInsurance.com

Websites: Company Site: DennisVolzInsurance.com

Client Convenience Site: 6701000.com

My 'Other Blogs'
Working by Referral
Musings from California

The Paint on my Fender Isn't Going To Match the Rest of the Car

Face it. Paint fades over time. Your car sits out in he sun and gets weather-beaten by rain, snow, etc. After a few years, the paint looks OK, but you can tell that it isn't like it was when the car was brand new.

Then.... you have a little fender bender and your left front fender is crunched. Damage isn't all that bad, but you need a new headlight and some paint when it's all done.
Doesn't matter how good the body shop is at matching the color. Actually most of it is completely computer driven and there's specific formulas for a given year and make of the car. The body shop can match the paint spot-on PERFECT. That's NOT your problem though.


The new paint is new and the rest of the paint is not. While it will match perfectly to the color it won't look the same and you want to paint the rest of the car. You think the insurance company should pay for that.

THEY WON'T. (usually)

Matching paint is not their concern. It's been round and round in the courts and it's just not a case you're going win. There could be an exception if you're dealing with the insurance company of the AT-FAULT driver who hit your car. I'll talk abou that next.

Sadly the case is that the insurance company is NOT obgligated to match the paint on the rest of the car. You might get an adjoining door painted or a little "blending" of some kind, but if you want the paint matched by painting the whole car, you'll have to pay for the DIFFERENCE yourself.
Take heart though! This is an OPPORTUNITY!

You might be able to strike some kind of deal with the body shop to paint the whole car. Remember most of the cost of painting is to set up the job -- Masking; mixing the paint, booth time, drying time, etc. That's all the same if they paint a fender or the whole car.

Make a deal with the body shop OUTSIDE of the insurance deal to paint the rest of the car. You'll get a better price and you can ethically let the insurance pay for all that set up on THEIR nickle.

If you were hit by someone else and are dealing with THEIR insurance company, you might be able to get some consideration for the non-matching paint. NOT MUCH, mind you, but something. This won't work if the accident was your fault because your car is being repaired under the collision portion of your policy and there's no provision for a liability-type payment (which this is) in that portion of the policy and the adjuster (even if they want to) CAN'T pay for that for you.

Before you go after this, be sure you get into the head of the adjuster and know WHAT THEY NEED to write you that check by reading (at least the Purple Section of: They're NOT offering me enough for my vehicle.

You'll need to document the reduced value of your car because of the non-matching paint. It may only be worth a few hundred dollars, but it might be worth your time. Talk to some used car lots or people who sell cars a lot and you'll get some ideas. You'll need to get something in writing so you might want to be willing to type something up on their stationery and return to get their signature. Ask them what to say and you'll be on your way.

Remember the claim settlement gig is a process. Take your time and help the adjuster document their file and you'll get a better settlement.

GOOD LUCK!

It's a Good Life !

Dennis Volz Insurance Agency
10783 Jamacha Bl, Suite 1, Spring Valley, CA 91978
OFFICE: (619) 670-1000 - FAX: (619) 670-1121

eMail:Dennis@DennisVolzInsurance.com

Websites: Company Site: DennisVolzInsurance.com

Client Convenience Site: 6701000.com

My 'Other Blogs'
Working by Referral
Musings from California

Options When You Have Damage from a Prior Accident

A client called me yesterday with an interesting dilemma. Said that recently, when his car was parked on the street, it was hit by a Fire Truck on a call. Kind of unusual as Fire Truck Drivers are usually pretty good at what they do.

Nevertheless, he was concerned because on the same side of the car there was some damage from a prior accident and wanted to see if he could get that fixed at the same time. He also wanted to make sure the paint matched the rest of the car. So here's the advice I offered to Steve.

The insurance company is only going to pay for the damage that was a direct result of the accident caused by the Fire Truck. Nothing more, nothing less.

Your best bet is to make a deal with the body shop OUTSIDE of the parameters of the insurance company settlement. Here's why.

Anytime you repair a car there are some fixed expenses that are there regardless of the size of the job. The car has floor time, rack time, parts to order, paint booth time, drying time, set up the paint sprayer time, set up the sander time, on and on and on. The body shop will appropriately include most of that in the estimate for the insurance portion of the repair. Then the body shop might to ahead and fix your "other fender" for less because they have to go through all that set up stuff anyway.

Talk to your estimator at the shop see if you can't make a bettter deal. I bet you can.

GOOD LUCK!

It's a Good Life !

Dennis Volz Insurance Agency
10783 Jamacha Bl, Suite 1, Spring Valley, CA 91978
OFFICE: (619) 670-1000 - FAX: (619) 670-1121

eMail:Dennis@DennisVolzInsurance.com

Websites: Company Site: DennisVolzInsurance.com

Client Convenience Site: 6701000.com

My 'Other Blogs'
Working by Referral
Musings from California

You and Your Liability Umbrella

In the world of meteorology, whenever it looks like rain, an umbrella is good to have around. In the world of insurance, a Liability Umbrella can protect you from getting soaked as a result of losing a liability lawsuit.

People are suing each other today more than ever. Verdicts amounting to hundreds of thousands of dollars are being awarded by juries across the country in increasing numbers. If you accidentally injure someone or damage their property, you could be the one being sued. Even though your underlying policies may provide substantial liability limits, it is not uncommon today for juries to award damages that exceed those limits.

Coverage amounts are written in increments of $1 million and supplement your present policies to provide additional personal liability protection.

So, how does it work?

Typically you'll have insurance on both your home and your vehicles. Those policies can cover both loss through physical damage and protect you if you are sued. You can get sued for any number of things but usually you'll get sued if someone is injured at your home or injured as the result of an auto accident that is your fault.

Courts can award damages to cover doctor costs, pain and suffering, lost wages, loss of future income, loss of companionship (in the event of a death) and many others -- the list can be almost endless.

A Liability Umbrella steps in and pays when the limits of those policies are exceeded in the judgment. A $1 Million Umbrella gives you an additional million dollars of protection over and above BOTH your Home and Auto policies

Example: Your auto policy will pay up to $250,000 in personal injury damages when you are found at fault for an accident. You happen to hit a doctor one rainy Saturday night and he can't work for a couple years. The court awards $750,000. If you have a $1 Million Umbrella, your auto insurance pays $250,000 and your umbrella kicks in with the additional $500,000.

Obviously, umbrellas can go a long way to protecting your hard-won assets. I've seen cases where the judgements exceed their protection. They have to either go into the equity of their homes and pay from there or they get put on the LIFETIME MONTHLY PAY PLAN and have to sacrifice significant portions of their earnings for many, many years to pay the judgment. NOT a pretty picture.

The saddest part is that Umbrellas are generally extremely cost effective.

You can get a $1 Million Umbrella usually for under $300 a year. Many companies (including mine) will give you a sizable discount if your home and autos are insured with the same company. That can bring your cost down to the low $200's. In some cases a $2 Million, $3, or even a $5 or $10 Million Umbrella will make sense. Generally the more your net worth the higher your limits should be.

Liability Umbrellas are sensable, cost effective and serve to protect EVERYTHING you've worked so hard to accumulate throughout your life.

It's a Good Life !

Dennis Volz Insurance Agency
10783 Jamacha Bl, Suite 1, Spring Valley, CA 91978
OFFICE: (619) 670-1000 - FAX: (619) 670-1121

eMail:Dennis@DennisVolzInsurance.com

Websites: Company Site: DennisVolzInsurance.com

Client Convenience Site: 6701000.com

My 'Other Blogs'
Working by Referral
Musings from California

They're NOT offering me enough for my vehicle.

Whenever your vehicle has been declared a total loss, the insurance company will offer you a settlement based on the fair market value of your vehicle. (this works for cars, motorcycles, RV's, boats, etc.)

In the realm of United States tax law, the definition of "fair market value" is found in the United States Supreme Court decision in the Cartwright case:

The fair market value is the price at which the property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or to sell and both having reasonable knowledge of relevant facts. United States v. Cartwright, 411 U. S. 546.

So you get offered some money for your vehicle. They give you a number. Sometimes you'll like the number... sometimes you won't.

Here's what to do when you don't.

First of all, you should always have a number in mind when you begin to enter the final phase of the claim.. That requires that you do a little research on your own. Please keep this important truth in mind as you do.

MOST PEOPLE OVERESTIMATE THE REAL VALUE OF THEIR VEHICLE.

I know that YOU wouldn't do that, but some do. Just think about if for a second: Most people list their vehicles at a given price either in the paper or Auto Trader and then end up settling for less than that when they actually sell.

Remember: The price that the vehicle actually sells for is the FAIR MARKET VALUE of the vehicle.

Ok, so with that in mind, let's get about finding the FAIR MARKET VALUE of your vehicle. Here's your BEST sources.

1. Call ads in the newspaper for vehicles that are as close to yours as possible. Hope to find people who have already sold the vehicles. WHY? Well because you quickly explain your situation and ask them if they would mind telling you the price for which the vehicle ACTUALLY sold. Might be more or less than the advertised price. Make a record of the ad, the phone number and the ACTUAL PRICE. Get as many of these as you can.
2. Call a local used car dealership and explain your situation and ask for their help. Be willing to go see them. REMEMBER, you're in the market for a new car if yours has been totaled. Ask them help you determine the value of you car by looking in their records to see what similar models of theirs had sold for.
3. BE SURE the insurance company has the right specifications on your car. If you had leather seats and power EVERYTHING, make sure they have that noted in the file. (more on this later.)
   

So once you have a number in mind, you're ready to begin discussions with your insurance company. We'll get to that in a minute.... (and let me remind you here that I'm an agent not an adjuster, but I've worked with adjusters for over 30 years and I know how they think and what they need to write you that check...)

Here's a couple of things that are IMPORTANT to keep in mind as you proceed.

1. The claim adjuster is a hard workin' person just like you are. They're given MANY files a week to work through. I've seen it as high as 75!
   
2. They want to get this file off their desk as much as you want to get your money.
   
3. Most likely they DON'T REALLY CARE HOW MUCH THEY GIVE YOU FOR YOUR CAR! Yes, that's probably true. It's not their money. BUT... They have to justify in the file the amount they give you. If you can give them good justification for the value that you want, they are happy to write the check and get on the the next file.
4. If you become their ally in this effort, you'll get a much easier and (likely) more profitable settlement.
5. Insurance companies usually use an outside vendor to determine the value of the vehicle. (remember we talked about having your car accurately described to the insurance company....Leather Seats, etc???) The insurance company simply forwards that information to this vendor who researches SOLD VEHICLES in your area to determine the FAIR MARKET VALUE. It's usually NOT the adjuster who crunches the numbers..... he's just the messenger.
   

OK, now...back to the settlement.

ALWAYS have your acceptable number in mind before you call and ALWAYS let them make the first offer. You might be thinking $5,500 and they offer you $5,800. If that happens, simply say, "That sounds reasonable to me, can you mail the check today or would tomorrow be easier for you."

Have your documentation at the ready. You've done your research so you're ready. If the number is too low DON'T come unhinged. Ask them how they got the number and let them explain. Listen calmy and patiently without interrupting. Remember.....he wants settle and get rid of this file as much as you do.

Offer your documentation to help him justify paying a higher amount to you. Use phrases like, "Can I get a copy of this to you to help you with the file?" or "Would it help if I gave you some documented sales that were several hundred dollars above your offer?"

Calm... Collected and in control because you are. You don't have to settle until you're completely satisfied that you're getting fair market value.

If you don't have enough documentation, you'll have to go out and get some more. The more examples you can find, the better settlement you'll get for your vehicle.

Remember it's a process, not necessarily a one-time phone call. Take your time and win a friend along the way.

It's a Good Life !

Dennis Volz Insurance Agency
10783 Jamacha Bl, Suite 1, Spring Valley, CA 91978
OFFICE: (619) 670-1000 - FAX: (619) 670-1121

eMail:Dennis@DennisVolzInsurance.com

Websites: Company Site: DennisVolzInsurance.com

Client Convenience Site: 6701000.com

My 'Other Blogs'
Working by Referral
Musings from California