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What is No-fault Insurance?

Written by Michele Wilmonen. Posted in Ask An Insurance Question Last Updated: 08/31/2017

Q: A friend of mine that lives in a different state told me they have no fault car insurance. What is that and do I have it also?

A: No fault insurance is also called PIP coverage. It is personal injury protection coverage that pays for your injuries whether you were at fault for the accident or not, this is why it is called no fault insurance. For one state in particular, this type of coverage came about because the number of fraudulent car insurance medical claims reached astronomical levels.

Large organized groups of people would box an innocent driver in and then one of the vehicles would cut them off and slam on their brakes so that the innocent driver would rear end them. The people in the other cars would then give statements as witnesses stating that the innocent driver was actually driving too close and that’s how they rear ended the front driver. No matter how much the innocent driver claimed the truth of what really happened, they were outnumbered by the people in the front vehicle and the fake witnesses in the vehicles that boxed them in.

In addition to the accident set up, there were also doctors involved that confirmed injuries that were fake and attorneys that help set the stage for settlements. Everyone got a payout from this fake claim.

When these rings were finally busted the state stepped in and started changing coverage laws to help stop this car insurance fraud from happening.


Wells Fargo Forced Me to Buy Their Car Insurance

Written by Michele Wilmonen. Posted in Ask An Insurance Question Last Updated: 08/30/2017

Q: Why did Wells Fargo charge me for car insurance when I already had a policy?

A: This Washington Post article is a really good explanation of what has been going on over at Wells Fargo for the last 6 years.

To put it short and sweet, Wells Fargo was basically charging people for forced place car insurance that they should never have been forced to have. Not only did this cost many people additional money, it also caused some to default on their loans and lose their vehicles; which also means that it ruined their credit.

Now that they have caught this “error” people are supposed to be getting refunds. But if you were one of the ones that lost your vehicle and had your credit ruined because of this, don’t settle for the refund. It would probably be a good idea to talk to an attorney about what options you have available to you to rectify this.

With this coming on the tail of the fake bank accounts and credit cards that were being created by Wells Fargo employees, it makes it a little bit harder to believe that this forced place car insurance was just an “error”.


My College Student and my Car Insurance Policy

Written by Michele Wilmonen. Posted in Ask An Insurance Question Last Updated: 08/30/2017

Q: Why won’t my car insurance company let me take my college student off my policy?

A: Your car insurance company is out to protect themselves, always remember that. And a college age student that still drives your vehicle when they come home every now and then is a way for them to deem them a risk and increase your insurance premium.

Does it make sense? No, it doesn’t and here’s why.

A college student is away from home living under a different roof and usually doesn’t have access to the vehicles back at home. They are also an adult. Any other adult or family member that meets this description would never have to be added to your policy. But because they are a college student that used to live in your household and there is the remotest possibility of them driving your vehicles again, the insurance company is going to make sure they get a higher premium from you.

Can you do anything about this? Yes, you can.

First, tell the insurance company that you no longer claim your college student on your taxes (if this is true and it usually is) and that they do not have one of your vehicles with them at school. If the insurance company requires proof they no longer live with you, then give them the new address.

If they still do not let you remove your college student that is an adult and no longer living in your household, it may be time to find another insurance company.

Unlisted Driver on Car Policy

Written by Michele Wilmonen. Posted in Ask An Insurance Question Last Updated: 08/30/2017

Q: What happens when a driver not on your  car policy gets into an accident with your car?

A: Well first, your car insurance company is going to want to know if they are a regular driver or a temporary driver. So be prepared for a lot of questions. If it was just someone borrowing your vehicle and was a one-time occurrence, nothing more will be said and they will usually drop the issue.

However, if this person regularly uses or borrows your vehicle they will require that you add them to your policy. If you refuse, they will either add the person without our permission or they will cancel your policy.

If the driver is your child, they will also require you to add them to your policy even if they don’t drive very often. This can include children that don’t normally live with you if the insurance company deems them high enough of a risk or consistent enough of a driver that they want them on the policy.

Any other family members or friends that live in the household will be required to be added to your policy or excluded from your policy, regardless if they have their own vehicle they normally drive or not. Now that they have been in an accident and your insurance company knows about them, they are considered a risk.


Why Do My Car Insurance Rates Keep Going Up?

Written by Michele Wilmonen. Posted in Ask An Insurance Question Last Updated: 08/05/2017

Q: I don’t have any accidents or tickets, but my car insurance rates keep going up. Why? It doesn’t make any sense.

A: What most people don’t understand is that insurance is literally a group effort and there are a lot of factors that play a part of your insurance rate that really have nothing to do with you.

Insurance explained in its simplest form is that a group of people pay insurance premiums into an account and when one of those people have a claim money is paid from that account to pay the claim. There has to be enough money in the account to be able to pay the amount of the claim or the whole system will not work. So to determine how much each person should pay the insurance company has to take into account how much vehicles cost to replace and fix today, how much medical bills are, how much rental cars cost, how much towing a car costs, and how much wages are to pay for the employees that service your claims and policies.

If any of those things increase, then everyone’s car insurance rates have to go up to compensate.

Another factor out of your control when it comes to your car insurance rates is the risk factor. For example, recently car insurance companies increased rates because the price of gas went down. Because gas prices dropped people started driving more, the more time people spend driving on the road the higher the chance they will be in a car accident.

If you feel you are being charged too much for your insurance after a car insurance rate increase, it may be time to do a policy review or to start shopping other insurance companies.

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Car Insurance Guidebook Unravels the Car Insurance Mystery

Unless you work in the car insurance industry, the topic is probably a mystery to you. The words deductible, comprehensive, collision, liability, premium, loss of use and bodily injury are all gibberish when they reach your ears.

Unfortunately, insurance is something that you are required to have by law if you want to drive. Because of how confusing it is many people go around in almost an insurance daze while they get car insurance quotes from the auto insurance companies that they have heard of. In reality, they are completely lost as to what they are actually buying.

Instead of looking at what each insurance company offers in the terms of protection for both themselves and their car, they are instead looking for cheap car insurance. Finding the cheapest car insurance coverage makes having to buy the required product all that much less painful, but misses the whole point of having insurance.

Learning about insurance through your insurance agent or websites like Car Insurance Guidebook will give you the upper hand when you looking for car insurance. You can take your knowledge and not only find the best price for insurance, you can use it to find really great insurance to protect you and your assets. Then you aren’t stuck settling for just average car insurance that can hurt you financially if you ever need it because there isn’t enough protection.

For example, when looking for insurance the car insurance rates are just the first of many factors that need to be taken into account when you are shopping around for car insurance. You also need to take into account the type of vehicle that you are driving. Many people don’t know this.

Are you driving around a vehicle that is a new sedan and can be protected under any blanket insurance policy? Or do you have an old car that you fixed up that needs special protection and could be better covered under classic car insurance?

Don’t just assume that when you compare car insurance that it will be a one-size-fits-all policy. This is where the insurance knowledge will come in handy; you will know what you need to protect yourself and your vehicle.

You will understand what your insurance agent is talking about when they use insurance terms and you will actually be able to make an informed decision. This is much better for you instead of the “nod and smile” approach people take in their insurance agent’s office.

Also just like your life changes your insurance needs will change. This year you may just need to learn about the best deductible to have. Next year you may need to educate yourself on car insurance for young drivers. As the years pass, motorcycle insurance may be something you will need to know.

Many wise people say that you never stop learning, so take their advice and educate yourself on the insurance that you spend a lot of money on and can’t get away with not having.