auto insurance

Auto Insurance for Rental Vehicles

When picking up a rental vehicle the concierge, more often then not, will offer additional auto insurance through the rental business for an additional fee. Many drivers blindly decline or accept this coverage without checking into their own auto insurance policy. Depending on the coverages you’ve chosen for your own auto insurance policy, you may or may not already be covered.

If you’ve purchased collision coverage on your own policy, it should cover the damage you cause to any car you’re driving. Many auto insurance policies however state that your auto insurance policy is in excess to any other coverage present. Meaning if you were to purchase auto insurance from the rental dealership, your own policy would kick in after the purchased rental auto insurance. It is also important to remember your own auto insurance policy will require a deductible to be paid out before your insurance company starts paying the bills.

Comprehensive coverage will also likely cover you while driving a rental vehicle and include fire, theft, vandalism and accidents involving an animal. It’s important to remember yet again that your insurance policy requires a deductible and is in excess to any other insurance, such as additional rental insurance if you choose to purchase it.

If you are involved in an accident and found at fault while driving a rental vehicle, your own policy’s liability insurance will most likely pay damages you caused someone else as well as medical expenses accruing in direct result of your negligence. Much like collision and comprehensive coverage, your own auto insurance policy will be in excess of any other auto insurance present.

If you do not carry your own auto insurance policy, or have no comprehension or collision coverage, purchasing insurance from the rental dealership is a good idea. If you choose to purchase insurance through the rental business be sure to ask about discounts. If you are a member of a public radio station, AAA or another type of club you may be eligible. Drivers may also be eligible if they will be keeping the rental vehicle in a garage or driving in a safer neighborhood with less traffic.

Always play it safe, give your local auto insurance agent a call and ask what will and will not be covered while driving a rental. If you’re looking for auto insurance give MassDrive a call where we compare quotes through various carriers finding you the best policy for the best price.

Massachusetts Division of Insurance Issues Warning

The Massachusetts Division of Insurance has issued an official warning to all auto dealers in the state. Salespersons are told to watch what they say and do regarding auto insurance while selling a vehicle. Joseph Murphy, the Massachusetts Commissioner of Insurance, published a letter addressed to all auto dealers and salespersons on the Consumer Affairs and Business Regulation website.

Murphy states numerous reports have been filed with the Division of Insurance that certain motor vehicle salespersons are giving recommendations about particular insurance companies and assisting customers in purchasing their auto insurance.  He warns that only licensed insurance producers are given the authority to sell or attempt to sell, negotiate or solicit insurance, including motor vehicle insurance. The letter stated:

This Bulletin reminds insurance companies and those individuals involved in the sale, finance, registration or insurance of motor vehicles of the Massachusetts rules about placing insurance on motor vehicles.  These rules reflect the longstanding principle that only those who have demonstrated knowledge and competence about motor vehicle insurance by obtaining an insurance license from the Division are permitted to advise consumers about the purchase of such coverage.

The posted bulletin gives these five specific examples of what an auto salesperson may not do while selling a motor vehicle:

Example 1:  A motor vehicle salesperson advises a customer that he could save money by buying his motor vehicle insurance from The XYZ Insurance Company. The salesperson is improperly “soliciting” motor vehicle insurance because she is recommending or urging a person to apply for a motor vehicle insurance policy from a particular company.

Example 2:  A motor vehicle salesperson assists the customer to obtain insurance online by using his office computer to search for motor vehicle insurance for the customer while the customer watches. The salesperson is violating Massachusetts insurance law because he is “negotiating” motor vehicle insurance for the customer by assisting the customer to “obtain” it.

Example 3:  A motor vehicle salesperson offers her customer the use of a computer at the motor vehicle dealership so that the customer can search for motor vehicle insurance, but the computer is preset to the website of a particular insurance company. The salesperson is improperly “soliciting” motor vehicle insurance because she is asking or urging a person to apply for insurance from a particular company.

Example 4.  A motor vehicle salesperson who is arranging financing for the purchase of a motor vehicle tells his customer that she must purchase insurance from a particular insurance company. The salesperson is violating Massachusetts law because he is making financing contingent on purchasing insurance from a particular insurance company.  G.L. c. 175, § 193E.

Example 5:  The motor vehicle dealership maintains a computer terminal linked to the internet for the use of its customers. A customer may use the terminal to search for insurance as long as the salesperson does not operate the computer, the computer is not preset to any particular insurance company’s website, and the salesperson does not recommend that the customer apply for motor vehicle insurance from a particular company.  The salesperson may suggest that the customer start her search for motor vehicle insurance by visiting a site that provides general advice on the purchase of such insurance.  A salesperson may always refer her customer to The Division’s website, for such information.

This is a firm reminder not only to auto salespersons, but consumers as well. Only a licensed agent holds the knowledge necessary for insuring you with appropriate limits. The deregulation of the auto insurance market has given consumers the option to compare quotes and find the best price, not to be bullied into signing with one insurance carrier or another. For a free quote call MassDrive where a friendly representative will compare quotes from different carriers for you!

To read Joseph Murphy’s letter regarding the involvement of motor vehicle salespeople in the solicitation, negotiation or sale of motor vehicle insurance please access the Consumer Affairs and Business Regulation website here.

The Harsh Reality for College Graduates

College graduates come out with hopes, aspirations and debt. That’s right, debt. College graduates are graduating college with an average of 3,262 in credit card debt. In addition to credit card debt, students are also graduating with student loans ranging from $10,000 to $52,000 or more. It is a common misconception that after graduation these debts will be easy to pay off. Graduates often believe they are going to start making the “real” money that will provide them with everything they need and then some.

The harsh reality is that once graduates factor in bills and expenses they are not left with much. Factors such as, health care, 401K deductions, income taxes, car payments, auto insurance, rent, utility bills, student loans, credit card bills and food expenses. These expenses can be financially crippling to graduates, forcing them to cut back as much as they can. Unfortunately, some graduates are looking at auto insurance as an unnecessary expense. In reality, it is far from unnecessary. Not only because it is illegal to drive without auto insurance in all 50 states but the risk one takes without coverage can prove to be detrimental to ones finances.

On the other hand, this doesn’t mean you can’t save on auto insurance. People all over the nation are overpaying on auto insurance, whether its because they have the wrong policy or the wrong carrier. Don’t make this mistake! MassDrive can help you compare policies and carriers until you find the right fit. Our agents would be happy to field any questions you may have free of charge. Insurance can be confusing, so let us help you!

Check Insurance Before Driving Rentals

As the holiday season takes full swing many travelers find themselves in need of a rental car. When purchasing rental cars most businesses will offer the option of additional insurance. It’s important for a driver to check in with their current carrier  to find out what coverages would follow members of the policy.

Many drivers who already have an auto insurance policy will find their current coverage offers identical or better coverage than what rental companies offer. A number of drivers will decline the coverage without knowing what their own auto insurance policy covers leaving themselves under or uninsured. While on the contrary other consumers purchase the additional coverage which their current auto insurance would cover.

Not only is it important to consider current auto insurance, but other insurance policies held. For example someone with renters or homeowners insurance policies may cover burglary of things from inside the car. Also health insurance policies may cover the driver’s medical bills should an accident occur.

Another great alternative to checking with your current auto insurance policy is to check with your credit card company. Some credit card compaies will offer secondary auto insurance when you charge the rental. If they do offer secondary coverage, it’s still very important to call your auto insurance carrier to confirm between the two coverages damages would be paid for by them and not out of your own pocket.

Mass Home Sales on the Rise

The Warrner Group, a publisher of real estate information based out of South-Boston, reported last week Massachusetts single family home sales have have risen 17% from October or 2008. This has made October the 4th consecutive month of increased home sales. Many of the sales seem to be driven by first time homeowners looking to take advantage of the $8,000 tax credit, that was to expire the end of November but has been extended into 2010.

This increase in sales will also mean a number of new homeowners are looking for homeowners insurance. To save money on your insurance policies ask your insurance carrier for a companion policy. For example MassDrive offer these policies, when you sign up for your auto and homeowners insurance together you receive discounts on both.

Life Events Affecting Your Auto Insurance

Ever wonder before those big changes, how exactly is this going to affect me and the rest of my life? Here’s the skinny on how a few life changes may affect your auto insurance…

Marriage: Many changes come with marriage from filing taxes to adjusting bank accounts and discounts on your auto insurance as well. Combining spouses on the same policy saves money on the plan itself, not to mention the multi-car discount couples receive.

Getting Older: Auto insurance tends to drop after the early 20’s. These years increase your driving  as maturity level and ability to make decisions. In fact the safest drivers seem to be ages 55 – 65 years.

Retirement: After retirement you’re no longer  driving Monday through Friday to and from the office. Your leisure diriving is likely to be less than it your total driving prior to retirement. Likely decreasing your annual mileage, and thus your insurance premiums as well.

Drunk Driving and the Consequences

Drunk driving can lead to more intense consequences than you may thing. From fines and jail time to a suspended license and interlock devices the penalties are harsh. Once convicted of a OUI or DWI insurance companies see you as too big of a risk and may choose to drop you from their coverage. You can bet your search search for auto insurance after drunk driving charges will include sky high premiums.

On the first offense Massachusetts drunk driving laws mandate a fine from $500 to $5,000 and/ or face up to  two and a half years in prison after driving with a blood-alcohol-content of .08 or more. Not only will you face these hardships, but your license will be suspended for a full year.

On your second offense the consequences are more sever. A second conviction comes with: guaranteed jail time of at least 60 days no more than two and a half years, fine of $6,000 – $10,000, suspended license for 2 years, and an interlock device installed in your car. If the first offense consequences didn’t deter you from drunk driving, the second offense punishment should.

After a night at the bar or drinks at a firend’s house, do yourself a favor and call a taxi. The cash spent on cab fare may have just saved you hundreds of thousands of dollars if you would have been caught driving under the influence.

What to do When Involved in an Accident

The car ahead of you schreeches to a halt… you slam on your breaks and lightly bump the car in front of you. Moments later a third car sails full speed into your back bumper… now what?

When involved in an accident there are a few things to remember:

1. ABSOLUTELY DO NOT LEAVE THE SCENE. There are strict and heavy penalties for leaving the scene of an accident.

2. Make sure the accident scene is safe. Before exiting your car ensure there is no oncoming traffic or other dangerous obstacles.

3. After checking that everyone involved is safe, get as much information as you can from the other driver(s). Obtain their insurance and license information, address, and phone number at minimum.

4.Contact the police. File a report but do not admit fault. Even if you think you were at fault, you may be in shock and still not realized everything that happened.

5. If you have a camera phone or digital camera take a few pictures. Document the damages to both vehicles before the cars are driven or towed away.

6. Report the accident to your insurance company. Include as much information when filing your claim as possible. Relay the time, location, the other drivers information, accident details, and anything else you can remember from the scene to your insurance company.

The most important part of being in an accident is the safety of yourself and other driver(s)/ passenger(s). Before proceeding with the formalities of exchanging information and filing a report, it may be more important to call an ambulance. Drive safely, and if you are involved in an accident stay calm, with a level head you’ll be able to handle the situation.

Why You Need More Than the Minimums

Auto insurance is anything but optional. Not only should you want to have car insurance, the sate requires drivers to purchase it. Two important coverages, among others, Massachusetts requires drivers to have are Property Damage and Liability Coverage.

Property damage covers damages the insured has caused to someone else property. Massachusetts state minimum for property damage is $5,000. This covers everything from street lamps and stop signs to other vehicles. Maybe you didn’t realize you were speeding when an oil spot sent you spinning into that Bentley… you’re still responsible for the damages and that $5,000 of coverage isn’t gong to do much. To be safe you should consider at least $100,000 of property coverage.

A second minimum coverage set by the state is Liability coverage. This includes bodily injury and property damage to others.  Maybe the state minimum will cover one person in a minor accident. But what if it was more than a fender bender? Or maybe there were passangers in the car you collide with? When multiple people are involved, or even just one in a decent accident – the $40,000 minimum state coverage isn’t likely going to cover all of the hospital bills, operations, medications, and therapy your accident incurred.

If you choose to only insure yourself to the state minmums, remember you are responsible for all expenses past what your insurance covers. Find out more about Massachusetts state minimum insurance requirements on the Massachusetts Division of Insurance Webpage.

What Does Everyone Have to Say About "Managed Competition"?

For years, the state of Massachusetts controlled auto insurance carriers to produce higher revenues.  However, the system has changed directions, and state officials put a “managed competition” program into place in order to lower car insurance premiums and rates. This program has been in existence for about two years now, and has received both praise and criticism from the public.

Many advocates predict that the introduction of this new system will cause many new carriers to enter  the industry. Opponents believe that the “managed competition” system would create discrimination of select drivers.  They also believe that the cheaper premiums would effect the state insurance agents negatively by reducing their commission.  These mixed reviews have not fully happened because the  system is still quite young. 

There are currently a few companies that provide auto insurance for Massachusetts drivers, and are offering competitive and cheap premiums and rates for their consumers.  As the years go by with this new system, more opinions will form, and hopefully the auto insurance industry will be both beneficial for both consumers and state agents.

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