Smart Auto Insurance Blog

New Jersey auto insurance consistently ranks as one of the highest states for auto insurance rates and regulators are looking to curb some of the rising costs through new regulations.  The article “What the New Car Insurance Rules Mean for NJ” found on NECN.com answers some of the top questions New Jersey residents have about how the new regulations will affect them.

New Jersey auto insurance is looking at a big overhaul from the proposed regulation changes for the personal injury protection component of auto insurance policies.  The changes will essentially change how and what physicians can charge for treatments and there will be a restructuring of the process for appealing a denied claim.  This is all in hopes that rising premiums will be slowed down and New Jersey auto insurance will become more affordable.

The article is very useful in answering questions many residents have.  It answers some details about personal injury protection and outlines why the system needs a makeover at this time.  The changes to medical services are discussed and gives an understanding of the changes being made to the approval and dispute process that New Jersey has long known.  Insurers will be benefiting from these changes in addition to the consumer so hopefully this encourages auto insurance companies to support the proposed changes and regulations are put into place quickly.  The regulations are not quite a done deal since the public has until the end of September to comment and a decision will be made at that time.

Car sales continue to be less than desirable for many car makers across the nation in 2011, but GM is looking to change that.  To stay competitive and offer something different, GM is looking to offer free auto insurance coverage to new car buyers according to the article on USA Today by Chris Woodyard.

Uninsured drivers is a problem across the nation, including states like California and Oregon.  These two states are the location of this free auto insurance test where people who buy a new GM car will receive a year long policy from MetLife Auto Insurance completely free of charge.  This will not only save a customer money, but will save them time searching for auto insurance quotes.  It’s a quality policy, including both liability and physical damage coverage and exceeds the auto insurance requirements for both states.  The offer is only good until September 6th and applies to 2010, 2011, and 2012 Chevrolet, Buick, GMC and Cadillac cars, crossovers and trucks.

GM hopes to bring in more buyers with this unique offer.  The policy will cover the car and anyone who drives it with the owner’s permission for the entire year from the date of purchase.  GM is still in the testing phase of this offer to determine if it will appeal to a wide group of buyers.  The owner does not have to renew the policy at the end of the year, but this could be a great opportunity for MetLife Auto to reel in more customers as well.  Very interesting concept and curious to see how it all pans out.

The American Automobile Association (AAA) released its 2011 Your Driving Costs research which indicated that the price of auto insurance quotes on a sedan is down 6.1% but driving costs overall increased by about 3.4% since last year.

The AAA report shows that the average annual auto insurance premium for a sedan is $968 which is down $63 from 2010 according to the article “AAA: Insurance Costs Down, Overall Driving Costs Up in 2011″ by Matthew Morisset on the Online Auto Insurance News Team.  This decline cancels out the auto insurance increase from 2010.  The 2010 report showed that policy costs had gone up by 5.7% from 2009.

The insurance costs were based on a 47 year old man with a good driving record and drives between 3-10 miles each day.  The coverage for this sample policy included adequate coverage of $100,000/$300,000 with a $500 deductible for collision and a $100 deductible for comprehensive coverage.  This gives an average look of what a common policy price looks like for an individual but would obviously vary if the coverage, mileage or age were different.

The average yearly costs to own and operate a sedan is $8776 based on 15,000 miles per year.  This number actually increased from 2011 most likely due to the rise in gas prices, the costs of tires and the increase in depreciation rates.  A variety of cost categories were looked at including auto insurance, fees for licensing, taxes, finance charges, depreciation, gas, maintenance and tires.

Many people often wonder what type of coverage they have if someone they lend their car to gets in an accident.  Unfortunately, most do not consider this when they compare auto insurance benefits.  This is an important benefit to consider though, especially if you think you may be lending out your car to any friends or family members during the life of your policy.

In general, auto insurance policies follow the car.  This doesn’t always make sense to drivers since rates are based on their driving record, not the person they lend their car to, but most insurers follow this rule.  It is possible that you would be responsible for coverage if you are driving someone else’s car and they do not have auto insurance.  This is unfortunate situation that can confuse drivers.

According to the article “Lending Your Car Can Bring Auto Insurance Concerns” by William Pirraglia on E-Wisdom.com, when you lend out your car to someone, you take on ‘vicarious liability’.  Your auto insurance is responsible for property damage, bodily injury, as well as other possible damage charges.  Since you gave permission to for someone else to drive your car, you have to accept liability for your friend’s activity.  Legally the borrower has no classic insurance liability unless the car has no insurance on it.  If someone steals your car and gets in an accident then you would not be considered responsible for liability so that at least is a good thing.

There are a lot of complex exceptions based on a variety of scenarios, so be sure to check with your specific auto insurance policy to see how your insurer will respond to each situation.  Knowledge is key in preparation for accidents if you do decide to lend out your car to someone you know.

Every driver knows they should be carrying auto insurance to protect their car and their financial situation if they happen to be in a devastating accident.  Unfortunately, most people do not carry insurance for an earthquake or a tsunami and the Insurance Information Institute says the US is at risk for both of these natural disasters.

An article found through a link on the One Beacon Auto Insurance entitled “Few Homes Have Insurance Coverage for Earthquake or Tsunami, Although the US Is At Risk for Both” on iii.org, discusses the importance of making sure you have the right kind of insurance coverage for your specific living situation.  Most home owners insurance policies do not cover earthquake damage so individuals at risk need to shop around for either an endorsement or a completely separate policy to ensure they are properly protected.

Earthquake coverage is offered through various private insurance companies and can be affordable.  In California where earthquake risk is higher, insurance can be purchased through the California Earthquake Authority (CEA), which is a privately funded, publicly managed group.  In California, only 12% of people carry earthquake insurance which is down dramatically from 1996 when 30% carried protection.  During tough economic times people often eliminate unnecessary insurance products, but there is no earthquake season and you never know when you may be a victim of a catastrophic event.

We are bombarded with car insurance information all the time and it can often be challenging to sort out the facts from fiction.  According to the article “Experts Dispel Common Auto Insurance Myths” by Larry Printz found on The Ledger, AAA and the Insurance Information Institute have gathered the top car insurance myths out there right now and work to set the record straight.

The first myth is that red cars have higher car insurance quotes.  Color typically is not used when car insurers calculate quotes.  The second myth is that insurance costs increase as you get older.  Often times the opposite is true that rates decrease with driving experience.  The elderly can even take courses which will earn them discounts on their car insurance.

The next myth has to deal with your credit score.  Some people think it has no bearing on car insurance but it usually does.  If you have trouble paying your bills, car insurance companies can worry about you paying your premiums and some studies have shown a link between driving record and credit rating.  The fifth myth discussed clarifies that your policy does not automatically cover you for theft or damage to your car.  You have to carry comprehensive and collision.  Another myth is that the car insurance policy does not follow the car but it does.

One myth circulating is that soldiers end up paying more for car insurance, but this is not the case.  Many auto insurance companies actually offer discounts to military men and women.  The final myth says car insurance will cover you for business use of your car.  Depending on your situation you could find yourself uncovered if you happen to be using your car for business purposes, so double check to see what is included in your policy if you do use if for work purposes on occasion.

Hopefully dispelling some of these auto insurance myths out there will help consumers make more educated decisions and will carry the coverage that works best for their individual situation.

Auto insurance companies have been using gender as a pricing mechanism for many years when determining auto insurance quotes.  Women typically get lower auto insurance quotes because they are less likely to be in an accident, but despite this fact, many view this type of risk-based pricing as discrimination.

Things are looking to change in Europe when it comes to using gender in pricing.  According to the article “EU Court Bans Gender Basis for Insurance Cost” on DW-World by Andrew Bowen, the European Union’s highest court banned using gender as a factor when determining price.  The European Court of Justice ordered insurance companies to adopt a way of calculating rates without useing gender by December 21st of 2012.

This could have a negative effect on consumers over time.  EU law already banned using gender but the insurance industry had an exemption as long as the insurers regularly published statistical information on which their rates were based.  CEA, Europe’s insurance industry lobby, is against the decision and say the impact on price, benefits and consumer options could be huge.  Is this a trend that will make its way to the United States?  Only time will tell, but if it does it’s fair to say it will have a big impact on the way auto insurance rates are calculated and many will end up paying more for their policy.

Once a child turns 16 and they receive their license they must be covered by auto insurance and that usually occurs by a parent placing them on their policy.  When a teen has divorced parents and has multiple residences, auto insurance coverage can get a little tricky according to the article “Auto Insurance Coverage for Teen Drivers With Divorced Parents” by LVRJ.com.

Auto insurance companies and states have different policies when it comes to covering additional drivers in a household so it’s important to contact your insurer to see how to proceed.  Chances are, if you have a child who has access to driving cars at both parent’s homes then both parents will need to add the child to their policy.  The article says that some auto insurance companies will advise divorced parents that whoever has custody during the school year should add the child onto their policy.  Both parents are encouraged to contact their insurer to see how the requirements may be different.

Auto insurance is a requirement for all drivers and this is often glossed over by new drivers.  Regardless of who adds the child to the policy, there should be a united front on rules while driving.  Prohibit cell phone use and texting when in the car, limit the number of passengers when your child is driving, strictly require seatbelts and establish a driving boundary where your child can drive at any given time.  Remaining firm on these guidelines will help your child become a safe driver and hopefully cause lower car insurance quotes for you and your family.

Auto insurance companies are constantly changing their policies to compete with other insurers and to ensure they are offering the most up-to-date benefits.  There are many optional benefits that insurance companies use as leverage such as road side assistance, online bill pay and even pet insurance.  American Commerce has numerous unique policies which helps them to stand out.

One of the more interesting policies offered by American Commerce is called the Peace of Mind Package.  This is an optional upgrade to any auto insurance policy that offers immediate accident forgiveness from day one, an automatic deductible credit and the ability to drop your deductible up to $500 for remaining accident free.  This really gives a huge incentive for good drivers to gravitate towards American Commerce.  It makes sense that unique benefits will attract more customers.

Another policy option they offer is called AutoMaster Plus.  This is available for upgrade on standard policies and it provides some extended benefits.  Some of these additional benefits include covering items such as computers, cell phones, child safety seats, pet injury, glass chip and personal belongings.  It can also include death benefits and even more.  Check with your auto insurance company to see how your benefits stack up.

Finding an auto insurance policy that is perfect for you is possible, you just have to ensure you are getting the education you need.  Once you understand your state laws, and have determined your personal needs you can put together the different pieces of an individualized auto insurance policy.

The first part of the policy tends to be liability insurance since that is the most important part.  If you only have minimum liability you may be taking a risk in case you hurt someone so understand the financial implications of upgrading to better liability insurance.  Based on the type of car you drive you may want collision coverage and depending on how many drivers you have in your household you may want to combine policies.

Shopping around is definitely important not only for price but for various benefits such as paying online, accessing information through your phone, superior customer service or efficient claim processing.  Companies ranging from First Acceptance Insurance to big companies such as Progressive Auto Insurance offer a wide array of benefits to suit their customers’ needs.  You can find a helpful agent to walk you through the variety of benefits made available and the differences in cost.  With the right research you really can find the most perfect policy suited just for you.