As agents we are often asked a number of difficult questions relating to auto insurance coverage and how the coverage will respond in various situations. One of the most frequent questions we receive is in regards to purchasing the collision damage waiver when renting a car.
You know the routine. You just got off of the plane for your vacation. You’re ready to go hit the beach, but first you have to go through the dreaded conversation at the rental car desk.
“Would you like to upgrade to a bigger car?”
“Don’t need it.”
“Would you like to rent a GPS system?”
“Brought my own, thanks.”
Now, the biggie: “Would you like to pay for the collision damage waiver?”
Before you quickly reject this one as well, we want to give you 5 reasons below on why you should strongly consider purchasing the collision damage waiver the next time you rent a car.
1. Loss Valuation and Settlement. Did you know most rental agreements allow the rental car company to determine the value of the vehicle solely at its discretion if you are involved in a claim?
So if you are in an accident that totals a vehicle that is a few years old, the rental car company can still charge for a brand new vehicle. A standard auto insurance policy only pays “Actual Cash Value” of the vehicle, which means you will be stuck with the difference in value.
2. Indirect Losses. If there is an accident you will most likely also be responsible for the loss of rental income incurred by the company while the damaged vehicle cannot be used. And, while many auto policies will provide some coverage for this, there have been many cases where individuals are still charged thousands of dollars above what their insurance company would pay for.
3. Administrative Fees. If you damage a vehicle, there is a good possibility the rental car company will add additional charges for expenses such as towing, storage, and claims adjustment calling them “administrative fees”. Your insurance policy will not provide coverage for these expenses, either.
4. Diminution of Value. This is another fee the rental car company can add on if the damage to the vehicle is over a certain amount. For example, if a rented vehicle sustains more than $1,000 damage, many companies will charge an additional percentage fee (typically 25%) because they figure the sustained damage has now decreased the value of the car and their ability to sell it. Your auto policy isn’t picking up this fee.
5. Loss Payment. If you happen to damage a vehicle, it is common for the rental car company to immediately charge your credit card for the damage to the vehicle. This can create a huge mess as could potentially max out your credit card. This can create some real headaches with your insurance company.
One of the provisions within your policy is that the insurance company needs to be able to inspect the vehicle so they can accurately calculate a damage amount. However, the rental car company may not wait for an adjuster, and it is common for them to charge your credit card and begin repairs immediately.
The problem is that the provision within your insurance policy mentioned above may actually give your auto insurance company the right to deny the claim as they were not allowed to properly inspect the vehicle.
Between just the fees associated with damaging a vehicle, the valuation process, and payment mess, you can see how you could easily be out thousands of dollars. By not signing the waiver, you may potentially be setting yourself up for some huge personal expenses.
Recommendation: We know you don’t want to pay more money for the waiver, but believe us, if you happen to damage a rented vehicle, you’re life will be a thousand times easier than if you hadn’t signed and paid for it.
Also, please double check to see how your own insurance policy will react to some of the claims scenarios above.
Disclaimer: The above information is to be used as guidance only, and it is not to be considered as definite in any particular case. Every policy is different and you need to read through your policy and consult with your agent to best determine how your coverage will respond. The information provided is based on the ISO standard Personal Auto Policy in force in most states. Policy provisions and laws vary from state to state and they can change at any time. Due to the brevity of this article, we cannot analyze every possible loss exposure and exception to the general guidelines above.
Avoiding Home Improvement Scams
Arvada Insurance, Blog, Denver Metro InsuranceAfter a disaster, you most likely want to fix your damaged home as soon as possible. However, did you know this is also a prime time for fraudulent contractors to scam you out of money? To help protect your home and your wallet, here are five tips to keep in mind when you’re hiring help for your home project.
1. Be Cautious of Door-to-Door Contractors
Be leery of any contractor who approaches you unsolicited. They may tell you they just completed a job in your neighborhood, have materials left over from another job or that they’re running a “one day only” deal — whatever the story, don’t buy it. A reputable contractor should have enough business from advertising and referrals to help keep them busy without knocking on doors, so make sure to reach out to contractors you find through respected sources.
2. Find a Reputable Contractor
You can find dependable contractors in online listings, referrals from friends and family or organizations like the National Association of General Contractors. You can also search on the BBB website to learn more about the contractor and check for a history of complaints.
Also, be sure to ask your contractor for proof of liability insurance, licensing, bonding and any references. A trustworthy contractor will typically have these handy and be more than happy to share them with you.
3. Consider Multiple Bids
You may want to consider getting multiple bids on all of your contractor jobs to help ensure potential quotes are consistent and fair. And when it comes to price, the lowest may not be the best. If one bid is dramatically lower than the rest, you may want to get more information from that contractor to see if there are any extra charges that may get added later on and ultimately make that contractor more expensive.
4. Don’t Pay the Full Amount Up Front
It’s unconventional to pay for 100 percent of the work up front. If your contractor suddenly insists on payment up front, it’s a red flag. Once paid, you may never see that contractor — or your money — again.
Make sure you receive a contract with details of the work to be performed and the costs involved.. Typical payment terms are about 10 percent up front and the rest upon completion of the work. Also, it’s best to avoid paying in cash — instead, use a credit card or check so you have a paper trail.
5. Educate Seniors on Scams
Scammers have learned to target the elderly. Make sure your older family members are familiar with the common red flags. Also, if you’re older and living alone, it’s a good idea to run any home improvement projects by people you trust.
With a little research, you may be able to avoid a potential home improvement scam and find a contractor you can trust.
Yard Safety
Arvada Insurance, Blog, Denver Metro InsuranceInsuring a Vacation Home
Arvada Insurance, Blog, Denver Metro InsuranceProtecting Personal Items Left in Your Car
Arvada Insurance, Blog, Denver Metro InsurancePeople leave stuff in their cars every day. We drop our cell phones in the cup holder, leave a bag on the floor, and throw our golf clubs in the back seat. We’re human, so we forget about this stuff, park, and go inside. It happens. The thing is, sometimes when we come back to our cars, the things we left aren’t where we left them.
Does insurance cover this type of claim? If so, is it your homeowners insurance policy or auto insurance policy?
Some homeowners’ insurance policies treat your car as an extension of your house. That means your personal property coverage would protect almost anything (purses, luggage, camera equipment, electronics…all kinds of things) stolen from your car. This coverage may even be better than what’s offered by comprehensive car insurance! For instance, did you know comprehensive coverage usually doesn’t cover jewelry, clothing, and accessories kept in your car?
Keep in mind, though, that any claim would be subject to a deductible (most likely $500 or $1,000).
If you have additional questions, please feel free to contact our office.
Rental Car Damage Waiver
Arvada Insurance, Blog, Denver Metro InsuranceInsurance Cancellation vs. Non-renewal
Arvada Insurance, Blog, Denver Metro InsuranceThere’s a difference between an insurance company canceling a policy and choosing not to renew it.
Auto insurance cancellation
Insurance companies cannot cancel a policy that has been in force for more than 60 days except when:
Auto insurance non-renewal
Either you or your insurance company can decide not to renew the policy when it expires. Your insurance company must give you a certain number of days notice and explain the reason for not renewing before it drops your policy (the exact timeframes and rules will depend on the state in which you live).
There are a number of reasons an insurance company may choose not to renew a policy, and it may have nothing to do with you personally. For example, your insurer may have decided to drop that particular type of insurance or to write fewer policies where you live.
However, a nonrenewal can also be due to your record or your actions. Doing something to considerably raise the insurance company’s risk—like driving drunk—would be cause for non-renewal.
Tips for Driving in the Rain
Arvada Insurance, Blog, Denver Metro InsuranceChoosing an Insurance Deductible
Arvada Insurance, Blog, Denver Metro InsuranceWhat Is a Car Insurance Deductible?
Definition
Subrogation and Your Car Insurance Deductible
Choosing Your Deductible: Low vs. High
RV Insurance: The Basics
Arvada Insurance, Blog, Denver Metro InsuranceRV insurance protects your motorhome, travel trailer, camper, fifth wheel, etc. You can choose from a variety of coverages meant to protect your vehicle and provide peace of mind on trips and vacations or if you use your RV as a permanent residence. If you’re driving a motorhome, you’ll also need liability coverage to stay legal on the road.
How does RV insurance work?
When you buy RV insurance, your agent will ask simple questions about you, your RV, and how often you use it. You’ll then select coverages that will best protect you and your vehicle. If you damage your vehicle or you’re responsible for someone else’s damages or injuries, you’ll file a claim with your insurer. If your claim is covered, they’ll pay for the losses or injuries up to your coverage limits.
Do I need motorhome insurance?
Yes. You must have at least the state minimum for liability, since motorhomes are driven and not towed. When quoting motorhome insurance, all insurers will let you know the minimum requirements in your state. Failure to carry liability insurance could result in a revoked license, fines, or even jail time.
Do I need travel trailer insurance?
Because you’re not actually driving your travel trailer, you aren’t required by law to have insurance on a vehicle that you tow with a car or truck. However, your travel trailer is often a valuable asset, and should be protected the same way you insure your home, car, etc.
Most travel trailer policies include comprehensive coverage. It’s up to you if you want to add collision, but most financers will require you to carry both.
Tips for a Safer Commute
Arvada Insurance, Blog, Denver Metro Insurance