If you have no idea what is going on with Tiger Woods, then you must have been locked up in an Iraqi Prison. Because of his shinanigans, his corporate sponsors are dropping him faster than Jimmie Johnson racing around Daytona. Why are they doing this?
Copanies have images just like celeberties. When a company hires a celebery to be the face of the company and portray the company image, they expect that celeberty to maintain that image.
Tiger Woods was a perfect spokesperson for his top notch endorsemets like Accenture, Gillette, AT&T and Buick. Blue Chip companies using a Blue Chip athelete to promote their image. What happens when that Blue Chip spokesperson loses the Blue in his Chip? What does that do to the comapnies respective image? Can a image change of a spokeperson reduce revenues and company loyalty? You bet it can. What can companies do to recoup those losses?
Now they can buy insurance against such instances. Tiger Woods has created a new insurance poicy for large cap companies who rely on celeberties to promote their image. Celeberty goes in the tank, sponsor has no worry about loss to revenue. They can recoup the losses through transfering the risk to an insurance carrier.
Do we live in an ever changing society, or what? Thanks Tiger. You gave me another arrow in my insurance quiver.
Sean Kimbrough
Thursday, December 17, 2009
Tucson Gem Show Insurance Requirements From Pima County
This year may be the last year Tucson will host the world's largest gem and mineral show. The show is administered by the Pima County Stadium District, Kino Sports Complex/Tucson Electric Park. Due to political and fiscal controversy surrounding the show, event organizers are considering pulling the plug on one of Tucson's largest annual revenue generating events.
Please follow this link to read the entire article published at Ezinearticles.com
We offer insurance coverage for vendors that plan to participate in events throughout Arizona.
Please follow this link to read the entire article published at Ezinearticles.com
We offer insurance coverage for vendors that plan to participate in events throughout Arizona.
Not All Insurance Agents Are Created Equal
Agents have fiduciary duties to their clients requiring the agent to collect all relevant details of the risk to be insured. That involves asking several questions as to the characteristics of the risk which the insured wants to place insurance against. All the collected information needs to be translated to the underwriter of the carrier which the agent wishes to quote/place the policy so the underwriter can appropriately approve and bind coverage.
Follow this link to read the entire article published on Ezinearticles.com
The article was spawned out of a request to quote event insurance which was already submitted by another local agent to a wholesale broker he and I happen to have in common. We found out that the other broker was not asking all the appropriate questions regarding the insureds operatoins. When we discovered material facts that could effect the covered needed, the insured felt we were only trying to make the other broker look incompetent. That was not the case. We only wanted to make sure the insured was receiving adequate coverage to meet his risk.
Merry Christmas.
Follow this link to read the entire article published on Ezinearticles.com
The article was spawned out of a request to quote event insurance which was already submitted by another local agent to a wholesale broker he and I happen to have in common. We found out that the other broker was not asking all the appropriate questions regarding the insureds operatoins. When we discovered material facts that could effect the covered needed, the insured felt we were only trying to make the other broker look incompetent. That was not the case. We only wanted to make sure the insured was receiving adequate coverage to meet his risk.
Merry Christmas.
Saturday, December 12, 2009
Genral Contractors, Additional Insured Endorsement Downside
General Contractors (GC) have gotten into a bad habit of automatically requiring their Subcontractors to add the General Contractor as an Additional Insured on the Subcontractor's Commercial General Liability insurance policy without regard to the negative consequences.
Follow the link below to read the entire published article on eZines.com...
General Contractors...
Follow the link below to read the entire published article on eZines.com...
General Contractors...
Friday, December 11, 2009
Divorce Insurance, Prenumptual Agreement, Preperation for the end
Are we really goiong to see insurance policies covering the costs of divorce in the near future?
"A professor at the University of Illinois at Chicago says it would be feasible for insurance companies to offer divorce insurance."
"J. Christopher Westland, a professor of information and decision sciences, says he began sketching out the actuarial tables for such insurance as an exercise, prompted initially by watching a friend go through a messy divorce and its financial consequences. After a little work, he says he found the idea is possible."
'“It’s basically a workable business,” Westland says.'
According to Profesor Westland, divorce policies would cover the costs associated with legally divorcing. That would primarily include attorney fees and court costs. It would not include any money for settlements or living expenses afterwards.
What about the moral hazard of offering an insurance policy that could encourage a spouse to file for divorce early in a marriage?
"...David Hoffman, a law professor at Temple University and an expert in contract law, who has written about divorce insurance, says he is not sure there is any way around the moral hazard and that is the idea’s undoing."
"No insurance company is likely to touch it, he says. In some states, it may not be legal to offer insurance with a moral hazard."
'“Given the moral hazard, I just don’t see it as an insurance product,” he says.'
With 50 percent of all U.S. marriages ending in divorce within 30 years, the notion of insurance against the new peril of 'Divorce' is more like saving money to cover the inevitable. Insurance companies would have to charge a premium equal to 50 percent of the benefit if they expect to at least break even on these new policies unlike homeowners insurance which is designed to insure, primariliy, against natural distaters that connot be predetermined. Can a homeowner expect a 50 percent chance that his home will catch fire, be burglarized, or destroyed in a windstorm? No. There is not a moral hazard associated with homeowens insurance. Arson is not a covered peril in any homeowners policy.
If it happens, more power to the attorneys who are the ones who will obviously benefit the most from divorce insurance. It would gauruntee their fees would be paid up to the policy limit. If you've been through a divorce, the attorney fees can create more stress than the actual breakup.
Sena Kimbrough
Big Boy Toy Insurance
A portion of this article was reprinted from the following osurce:
http://www.insurancejournal.com/news/national/2009/12/11/105912.htm
"A professor at the University of Illinois at Chicago says it would be feasible for insurance companies to offer divorce insurance."
"J. Christopher Westland, a professor of information and decision sciences, says he began sketching out the actuarial tables for such insurance as an exercise, prompted initially by watching a friend go through a messy divorce and its financial consequences. After a little work, he says he found the idea is possible."
'“It’s basically a workable business,” Westland says.'
According to Profesor Westland, divorce policies would cover the costs associated with legally divorcing. That would primarily include attorney fees and court costs. It would not include any money for settlements or living expenses afterwards.
What about the moral hazard of offering an insurance policy that could encourage a spouse to file for divorce early in a marriage?
"...David Hoffman, a law professor at Temple University and an expert in contract law, who has written about divorce insurance, says he is not sure there is any way around the moral hazard and that is the idea’s undoing."
"No insurance company is likely to touch it, he says. In some states, it may not be legal to offer insurance with a moral hazard."
'“Given the moral hazard, I just don’t see it as an insurance product,” he says.'
With 50 percent of all U.S. marriages ending in divorce within 30 years, the notion of insurance against the new peril of 'Divorce' is more like saving money to cover the inevitable. Insurance companies would have to charge a premium equal to 50 percent of the benefit if they expect to at least break even on these new policies unlike homeowners insurance which is designed to insure, primariliy, against natural distaters that connot be predetermined. Can a homeowner expect a 50 percent chance that his home will catch fire, be burglarized, or destroyed in a windstorm? No. There is not a moral hazard associated with homeowens insurance. Arson is not a covered peril in any homeowners policy.
If it happens, more power to the attorneys who are the ones who will obviously benefit the most from divorce insurance. It would gauruntee their fees would be paid up to the policy limit. If you've been through a divorce, the attorney fees can create more stress than the actual breakup.
Sena Kimbrough
Big Boy Toy Insurance
A portion of this article was reprinted from the following osurce:
http://www.insurancejournal.com/news/national/2009/12/11/105912.htm
Wednesday, December 9, 2009
Contractors, Taken Advantage of by Insurance Agents
U.S. Contractors are taken advantage of by their insurance agents at every renewal and new business submission. Why? Majority of Insurance Agents are lazy and their contractor clients take whatever their agent puts in front of them.
Anyone who purchases insurance products from an independent agent should demand quotes from multiple carriers. That’s the agent’s job, to shop the risk with several carriers to find the best choice and the best value. That is what the contractor is paying for, someone who has an understanding of his operations in order to make sure the coverages applying for are appropriate for the contractors exposure. How does the contractor know if he getting a good deal if he has nothing to compare? It’s like going to a used car lot and the salesman asks what you want. You say a sedan. He says here is the sedan for you. Give me a check and I’ll give you the keys. You say thank you and drive off the lot, down the road, get home and realize it is not the car you really wanted. Too late, you drove it home.
As an Independent Insurance Agent in Arizona who specializes in construction trades, and someone who was a construction contractor for the past 15 years, I was taught that it is my duty to my client to find the best insurance policy through the outlets I have access to. That does not mean I shop an application to 3 out of 5 carriers and pick the one I think is best for my client. It is not my job to make insurance purchasing decisions for my clients. They are paying the premium, not me. They are the ones that have to live with themselves if they made a bad decision. My duty is to present my client as many quotes as I can obtain, explain them to my client, discuss the pros and cons of each one and let my client decide which policy is best for his needs. That does not always mean the least expensive policy will be selected or the most expensive will always be declined. During my 15 years as a contractor, I never had an agent bring me more than one quote. That was all I had to choose because that’s what the agent told me I needed or it was all I could get due this reason or that reason.
I have learned it is best to let the prospect/client make the purchasing decisions. Put the pressure on them to decide what is best for their company. They are the ones who are responsible for making the premium payment. It is my job to assist them in finding the carriers and assist in making an informed, educated decision about how best to protect their largest asset and income source. Once they decide, it then takes the pressure off me if they are unhappy with their selection in the future. I reassure them, at renewal, we can take a look at the other carriers I have access to for a better fit. I left my door open for possible future problems with the contractor’s selected carrier. “You are not pleased with the claims handling of XYZ Company, Mr. Client. Do not worry. I will help you get through this rough process and then begin looking at other options for you.” When I come back with 4 other options, the same process starts all over again. I will make the presentation outlining the pros and cons of each carrier and let him decide which one is best for his company’s needs.
When I present a client with 3-5 quotes, he knows I have put some work into this process. I did not take an application, send it to 3 companies, pick the one that pays the highest commission with the highest premium and make the contractor believe that I worked so hard getting this one quote. “By the way, this is the best quote I could find based your credit, claims experience, exposure, etc.” Hogwash! I show my client the commission on each quote so he knows I am an above-board Insurance Agent not sitting in his office taking advantage of him.
Contractors need shop for insurance like they shop for any other product. Obtain as many comparable quotes as they can within a reasonable amount of time. Have the agent(s) clearly explain the differences between all the quotes and carriers. If the contractor feels an agent is not being forthcoming or is unable to explain his products professionally, the contractor should take the time to find another agent. It is not just the policy a contractor is purchasing. He is also purchasing the agent through a commission. If the contractor is not comfortable with the agent, get rid of the agent.
The same goes for the agent. I feel it is important to have a comfortable yet professional relationship with my clients. If I feel I am being taken advantage of or a client is slow making his payments, I tell him, at renewal, to find a new agent because I do not feel we have a working relationship conducive to our business goals. If the contractor feels I have met his expectations or, especially, exceeded his expectations, he asks what we can do to keep the relationship and how we can make it better. At that point, I notify him that he is on a probationary period for the next year and if he does cooperate with any of my requests, I will not submit his renewal application next year. Amazing how well contractors respond.
A contractor purchasing an insurance policy is no different than anyone else who purchases any product in a store (not so much online). When we shop for anything, we want choices. We want to feel we made the best decision based on all the factors presented to us. Commercial General Liability Insurance is no different. Why should Contractors, or any business owner for that matter, settle for less in purchasing a Commercial General Liability Insurance policy than he would if he purchasing a television for his family? A few quality choices lead to better decision making no matter the product.
David Barnett, Sr. Vice President-Commercial Division
520.908.7866
david@bbtimail.com
Anyone who purchases insurance products from an independent agent should demand quotes from multiple carriers. That’s the agent’s job, to shop the risk with several carriers to find the best choice and the best value. That is what the contractor is paying for, someone who has an understanding of his operations in order to make sure the coverages applying for are appropriate for the contractors exposure. How does the contractor know if he getting a good deal if he has nothing to compare? It’s like going to a used car lot and the salesman asks what you want. You say a sedan. He says here is the sedan for you. Give me a check and I’ll give you the keys. You say thank you and drive off the lot, down the road, get home and realize it is not the car you really wanted. Too late, you drove it home.
As an Independent Insurance Agent in Arizona who specializes in construction trades, and someone who was a construction contractor for the past 15 years, I was taught that it is my duty to my client to find the best insurance policy through the outlets I have access to. That does not mean I shop an application to 3 out of 5 carriers and pick the one I think is best for my client. It is not my job to make insurance purchasing decisions for my clients. They are paying the premium, not me. They are the ones that have to live with themselves if they made a bad decision. My duty is to present my client as many quotes as I can obtain, explain them to my client, discuss the pros and cons of each one and let my client decide which policy is best for his needs. That does not always mean the least expensive policy will be selected or the most expensive will always be declined. During my 15 years as a contractor, I never had an agent bring me more than one quote. That was all I had to choose because that’s what the agent told me I needed or it was all I could get due this reason or that reason.
I have learned it is best to let the prospect/client make the purchasing decisions. Put the pressure on them to decide what is best for their company. They are the ones who are responsible for making the premium payment. It is my job to assist them in finding the carriers and assist in making an informed, educated decision about how best to protect their largest asset and income source. Once they decide, it then takes the pressure off me if they are unhappy with their selection in the future. I reassure them, at renewal, we can take a look at the other carriers I have access to for a better fit. I left my door open for possible future problems with the contractor’s selected carrier. “You are not pleased with the claims handling of XYZ Company, Mr. Client. Do not worry. I will help you get through this rough process and then begin looking at other options for you.” When I come back with 4 other options, the same process starts all over again. I will make the presentation outlining the pros and cons of each carrier and let him decide which one is best for his company’s needs.
When I present a client with 3-5 quotes, he knows I have put some work into this process. I did not take an application, send it to 3 companies, pick the one that pays the highest commission with the highest premium and make the contractor believe that I worked so hard getting this one quote. “By the way, this is the best quote I could find based your credit, claims experience, exposure, etc.” Hogwash! I show my client the commission on each quote so he knows I am an above-board Insurance Agent not sitting in his office taking advantage of him.
Contractors need shop for insurance like they shop for any other product. Obtain as many comparable quotes as they can within a reasonable amount of time. Have the agent(s) clearly explain the differences between all the quotes and carriers. If the contractor feels an agent is not being forthcoming or is unable to explain his products professionally, the contractor should take the time to find another agent. It is not just the policy a contractor is purchasing. He is also purchasing the agent through a commission. If the contractor is not comfortable with the agent, get rid of the agent.
The same goes for the agent. I feel it is important to have a comfortable yet professional relationship with my clients. If I feel I am being taken advantage of or a client is slow making his payments, I tell him, at renewal, to find a new agent because I do not feel we have a working relationship conducive to our business goals. If the contractor feels I have met his expectations or, especially, exceeded his expectations, he asks what we can do to keep the relationship and how we can make it better. At that point, I notify him that he is on a probationary period for the next year and if he does cooperate with any of my requests, I will not submit his renewal application next year. Amazing how well contractors respond.
A contractor purchasing an insurance policy is no different than anyone else who purchases any product in a store (not so much online). When we shop for anything, we want choices. We want to feel we made the best decision based on all the factors presented to us. Commercial General Liability Insurance is no different. Why should Contractors, or any business owner for that matter, settle for less in purchasing a Commercial General Liability Insurance policy than he would if he purchasing a television for his family? A few quality choices lead to better decision making no matter the product.
David Barnett, Sr. Vice President-Commercial Division
520.908.7866
david@bbtimail.com
Friday, August 21, 2009
What Is Liability Insurance
If you own a car in America your state requires you to carry Liability Insurance. What is liability? Let's begin by defining the term "liable" as by Websters New World Dictionary:
1. Legally bound or obligated, as to make good any loss or damage that occurs in a transaction; responsible
2. Likely to have, suffer from, etc.; exposed to or subject to [liable to heart attacks]
3. Subject to the possibility of; likely (to do, have, get, etc. something unwanted or unpleasant)
The definition of "liability" is:
1. The state of being liable
2. anything for which a person is liable
How does this apply to auto liability insurance?
You are driving your car and hit another car from behind causing both property damage (the other car's damage) and bodily injury to the other car's occupant(s). So, according to the first definition of "liable" you are legally obligated to make good the damages you incurred to the other person. You are liable for their sustained property damages, bodily damages, hospital bills, doctor bills, loss of income/wages and any other expenses incurred due to your negligence.
So let's look at how insurance comes into play involving an auto accident. Insurance is transferring risk from the individual - you - to a company. You agree to pay a premium in exchange for money (liability limits) you are legally obligated to pay in the event you are found negligent for someon else's loss. You hit someones car and were determined to be "at fault" (AZ is an at-fault state). By paying the agreed amount of premium, the insurance is now obligated, on your behalf, to settle the claim of loss by the other party. You then agree to hand over all claims handling to the the insurance company. The insurance company will settle to their liking. That is what you agreed to when you signed the insurance contract/policy and submitted the premium.
How do you determine what are adequate liability limits for you and your family? Let's keep on with the above example. After you were determined to be negligent in an auto accident and the insurance company exhausted all of the liability money you agreed to in the policy (we will look at limits next) paying to replace/repair the other car and all medical bills associated with the accident, it was discovered that your limits were insufficient to pay for all the damages sustained. Now the claimant has the right to take you to court and sue you for the remaining monies your insurance policy did cover. The other party has the right ask for full disclosure of your assets, including current and potential income, to determine your ability to repay their remaining bills and expenses.
Arizona law allows the claimant/plaintiff to request up to 15% of your GROSS income be garnished until your obligation is paid in full. If you have liquid assets (cash, savings, retirement account, real estate equity), the plaintiffs attorney will likely go after those amounts first. So, as a rule of thumb, your liability limits should be sufficient to cover your current net worth.
How are limits offered by insurance companies? Arizona offers "split limits" with the minimum amount being 15,000/30,000/10,000. The first number is the maximum amount the policy will pay for each person's bodily injury. The second number is the maximum amount the policy will pay per each accident. The third is applied to property damage.
To explain in layman's terms using minimum liability limits: you hit a car and send 3 people to the hospital. Your policy limit for all of their injuries is $30,000 with a maximum of $15,000 to a single person. If the actual injuries exceed the $30,000 limit then they can sue you for the excess.
Your policy limit for the damages to their car is $10,000. If the repair/replacement of the car is greater than $10,000 then they can sue you for the excess amount.
As you shop for auto insurance comparing rates, keep in mind as the agent on the other end asks questions of your employment, lifestyle, and activities, he/she is not to prying into your privacy but rather determining what recommendations to make for your family's financial protection.
www.bigboytoyinsurance.com
Wednesday, August 19, 2009
Car Maintenance Tips
We all have a car that we rely on to get us around town, back and forth to work and home, road trips to see family and friends, and the best of all uses...moving our stuff. When our car does not want to cooperate on a hot, sticky August afternoon, it can become a nightmare getting it back on the road. You do not have to be a certified mechanic to keep your car running well and performing great.
Here are a few things you can do to make sure your car keeps getting from point A to point B with little worry.
1. Tire pressure - this is the easiest of them all and if you have a rag in the trunk you won't get your hands dirty. Check your owner's manual for the proper pressure or if you do not have a manual, inside the driver side door jam will have your car's tire pressure and tire size information.
2.Oil Change - Arizona is extremely dusty and HOT. These two characteristics are the worst on engine oil break down. It is very important to change your engine oil AND filter every 3,000-5,000. Several shops around your area have weekly/monthly oil change specials for under $30.
3.Battery maintenance - All the auto parts stores (Auto Zone, Checkers, Pep Boys) will check your battery for FREE! No getting dirty or worrying about battery acid on your nice clothes. In our hot environment, batteries usually last 3 years. Auto Zone has a Gold level battery with a 3 year free replacement and a 7 year pro rated warranty. It works, I've used it and saved allot of money on a replacement battery.
4.Air Condition system pressure - I was at an auto part store last week and noticed a DIY A/C charging unit with R34 coolant for less than $35 complete with instructions. Otherwise, get into a shop and have the "top off" your A/C system if your car is over 5 years old.
5.Timing Belt/Water Pump - check your owner's manual, most manufactures recommend changing the timing belt every 60,000-100,000 miles. The timing belt and water pump are right there so most changes will take care of both. First hand experience with a timing belt breaking will cost several thousand dollars to have the engine replaced if you want to keep the car. Otherwise, the car is barely worth advertising for sale. Can you say...clunker? Make sure you get this done with a reputable shop so if they mess up you have recourse to get it fixed on the shop's dime.
6.Cooling System/Radiator - this is something you need to take to shop. Call around for pricing on this one. This a simple but environmentally unfriendly chore. Again, check your owner's manuel for recommended time when you need to replace your engines coolant/antifreeze. DIY - all you have to do is drain the old fluid and replace with new fluid while the engine is running so when the thermostat opens periodically, new fluid will flow into the engine block. It may take 30-45 minutes to refill depending on how hot/cold your engine is.
7.Brakes - When you hear your brakes squeaking, go to the shop and get the pads replaced and the rotors turned. The last you want is to have your brakes not work when you're traveling down the freeway at 70mph. Brake systems are easy to work with. If you get to a shop immediately after hearing the squeak, you should have no system problems. Brakes work from hydraulic pressure. As you press the brake pedal, pressure forces fluid through brake lines to the calipers. The calipers close together which closes the pads against the rotors. When the pads have worn down to the lowest possible level, a little piece of metal in the pad rubs against the rotor making the squeaking sound indicating time to replace the pads. Another way to check if it is time to replace your pads is look at the brake fluid reservoir. Remember, the brakes are a closed hydraulic system so as the pads get lower, so does the reservoir fluid.
8.Fuel injector cleaner - EASY! I like the Lucas oil cleaner. Auto Zone has a qt. size bottle for $10 and will last for 3-5 gas fill ups. It works and increases MPG!
Cars are great responsibility we tend to take for granted. A small of time and money can have great reward when it comes to keeping your car on the road and out of the shop. Most of us think of maintanence when it is too late and the repairs are for major part replacements which add up to high labor bills. When you figure the average shop charges $75 per hour, a 4 hour job cost you $300 PLUS the parts. If you take advantage of shop specials like oil/filter change, brake change, A/C charging before things break, it could save you and your car a lot of money and time NOT in the shop.
www.bigboytoyinsurance.com
Friday, August 14, 2009
How to Determine Insured Value for Your Vehicle
What is the difference between actual cash value and agreed value when it comes to your vehicle insurance?
When you place insurance on a vehicle (auto, boat, motorcycle,RV) the issuing insurance company is agreeing to replace the vehicle, in the event of a total loss, at the current value of the vehicle. Say you own a 2002 Honda Accord EX that you purchased new. You are the original owner and have taken good care of the vehicle through regular maintenance, proper tire rotations, kept the miles low, etc. and then you are in an accident that totals the vehicle. The responsible insurance company will offer you what the current value of the vehicle is based on Kelly Blue Book and NADA value, not what it cost to buy a new 2009 Honda Accord EX. You didn't own a 2009 vehicle so why should replace a 7 year old vehicle with a brand new one? You are buying an Actual Cash Value insurance policy.
What if you own a '32 Ford Roadster that you've spent the past 4 years restoring and rebuilding it into your dream car? It turns heads and wins trophies at the car shows. Your neighbors ask you about what it took to get it into such good condition. You take it out only on special occasions. Your wife is jealous. Do you want it insured for Actual Cash Vale? Of course not!
You want an insurance policy that will pay you today's value of your blood, sweat and tears poured into that car. You want an Agreed Value or Stated Value insurance policy. If the vehicle is totally damaged you want the current dollar amount of all that work.
How do you determine the dollar value? The insurance company will agree to give you the appraised value of your cherry 32' Ford Roadster. They will base the premium on the value you agree on (up to the appraised value), how many miles you place on the car annually, and where the car is garaged or kept on a regular basis. Some companies, like Grundy and Hagerty, specialize in these unique insurance policies.
Motorcycles are treated a bit different because of the various accessories bikers like to add to their rides. This includes saddle bags, exhaust pipes, rims, seats and backrests. Custom paint jobs are considered modifications which require receipts to justify the value paid by the insurance company.
If your vehicle is 0-5 years old, some companies offer a "new car" replacement option. This states that if the vehicle in purchased new and is totaled within the first five years of ownership, you can receive the dollar amount needed to purchase a new year model of the same vehicle. This options usually requires an additional premium that needs to weighed against the value of the car to determine it's true value. This feature is a common option on RV policies through Foremost, GMAC Insurance, and American Modern.
So, before you take that Hot Rod out for it's maiden trip to the car show, make sure you have the right insurance policy insuring the right value.
www.bigboytoyinsurance.com
When you place insurance on a vehicle (auto, boat, motorcycle,RV) the issuing insurance company is agreeing to replace the vehicle, in the event of a total loss, at the current value of the vehicle. Say you own a 2002 Honda Accord EX that you purchased new. You are the original owner and have taken good care of the vehicle through regular maintenance, proper tire rotations, kept the miles low, etc. and then you are in an accident that totals the vehicle. The responsible insurance company will offer you what the current value of the vehicle is based on Kelly Blue Book and NADA value, not what it cost to buy a new 2009 Honda Accord EX. You didn't own a 2009 vehicle so why should replace a 7 year old vehicle with a brand new one? You are buying an Actual Cash Value insurance policy.
What if you own a '32 Ford Roadster that you've spent the past 4 years restoring and rebuilding it into your dream car? It turns heads and wins trophies at the car shows. Your neighbors ask you about what it took to get it into such good condition. You take it out only on special occasions. Your wife is jealous. Do you want it insured for Actual Cash Vale? Of course not!
You want an insurance policy that will pay you today's value of your blood, sweat and tears poured into that car. You want an Agreed Value or Stated Value insurance policy. If the vehicle is totally damaged you want the current dollar amount of all that work.
How do you determine the dollar value? The insurance company will agree to give you the appraised value of your cherry 32' Ford Roadster. They will base the premium on the value you agree on (up to the appraised value), how many miles you place on the car annually, and where the car is garaged or kept on a regular basis. Some companies, like Grundy and Hagerty, specialize in these unique insurance policies.
Motorcycles are treated a bit different because of the various accessories bikers like to add to their rides. This includes saddle bags, exhaust pipes, rims, seats and backrests. Custom paint jobs are considered modifications which require receipts to justify the value paid by the insurance company.
If your vehicle is 0-5 years old, some companies offer a "new car" replacement option. This states that if the vehicle in purchased new and is totaled within the first five years of ownership, you can receive the dollar amount needed to purchase a new year model of the same vehicle. This options usually requires an additional premium that needs to weighed against the value of the car to determine it's true value. This feature is a common option on RV policies through Foremost, GMAC Insurance, and American Modern.
So, before you take that Hot Rod out for it's maiden trip to the car show, make sure you have the right insurance policy insuring the right value.
www.bigboytoyinsurance.com
Friday, August 7, 2009
How to Beat AZ Photo Ticket Enforcement
Have you received a photo ticket for speeding or running a red light? Wondering what to do? Nothing. That's right, do nothing. Do not respond to the mailed ticket, do not send money, do not call the court, do not schedule a court date, do not respond to any notices sent via mail.
Arizona Supreme Court states that we have to 'served' by an authorized process server. When the motorcycle cop pulls you over for speeding down Speedway at 45 MPH, he is your process server that you cannot fight. What you can fight is the validity of the circumstances for which he pulled you over. This is when you accept the scheduled court date and APPEAR! One idea is to reschedule the date in hopes the cop does not show up to defend his actions. The U.S. Postal Service does not qualify as an authorized process server.
Now, if a process server comes to your house to serve you your ticket, your caught. If you're home, answer the door. If you're not at home, oh well. He/she will have to come back to serve you at a later time. If you are caught, take the ticket and schedule your date in court. Worst case you'll have to pay the ticket plus a court fee. Be sure to ask the judge to expunge the ticket off your record if you agree to pay the fine and all court costs. You may be surprised what the judge will agree to.
I am not condoning speeding around town and running all the red lights you can. Eventually, the appropriate law enforcement agency will catch up with you as what happened to Francesca Cisneros in Scottsdale, AZ. She had collected over 60 tickets in 2006 for speeding and red lights. The police went looking for her at her place of employment. She was not there and called the number on the card left behind by the detective. She agreed to go to the police station and talk to the detective. That's when she got caught. Read the whole story 'Gotcha' by Ray Stevens.
Another method of beating the photo ticket game is if you have a vehicle registered to a company (corporation, LLC, PC) or a family trust.
Here's why: The police and courts may send process servers to visit the home of someone who blew off a mailed ticket. But they don't do the same thing for businesses. Lawyers say Arizona civil traffic violations can only be issued to a real, live person. Since the corporation can't be held liable, there's no reason to serve it the ticket.
Our local governments have found a means to collect more revenue to fill their empty coffers. Tax revenue at the lowest levels in decades, municipalities are scrambling to find ways to generate money without raising taxes. Photo enforcement is a nice way to supplement the loss in tax revenue. But, if the population decides that doing nothing until found is better than playing by the old rules, the municipalities that setup the photo radars may find that they are a waste of tax dollars they have tried to justify to to all of us tax payers.
www.bigboytoyinsurance.com
Arizona Supreme Court states that we have to 'served' by an authorized process server. When the motorcycle cop pulls you over for speeding down Speedway at 45 MPH, he is your process server that you cannot fight. What you can fight is the validity of the circumstances for which he pulled you over. This is when you accept the scheduled court date and APPEAR! One idea is to reschedule the date in hopes the cop does not show up to defend his actions. The U.S. Postal Service does not qualify as an authorized process server.
Now, if a process server comes to your house to serve you your ticket, your caught. If you're home, answer the door. If you're not at home, oh well. He/she will have to come back to serve you at a later time. If you are caught, take the ticket and schedule your date in court. Worst case you'll have to pay the ticket plus a court fee. Be sure to ask the judge to expunge the ticket off your record if you agree to pay the fine and all court costs. You may be surprised what the judge will agree to.
I am not condoning speeding around town and running all the red lights you can. Eventually, the appropriate law enforcement agency will catch up with you as what happened to Francesca Cisneros in Scottsdale, AZ. She had collected over 60 tickets in 2006 for speeding and red lights. The police went looking for her at her place of employment. She was not there and called the number on the card left behind by the detective. She agreed to go to the police station and talk to the detective. That's when she got caught. Read the whole story 'Gotcha' by Ray Stevens.
Another method of beating the photo ticket game is if you have a vehicle registered to a company (corporation, LLC, PC) or a family trust.
Here's why: The police and courts may send process servers to visit the home of someone who blew off a mailed ticket. But they don't do the same thing for businesses. Lawyers say Arizona civil traffic violations can only be issued to a real, live person. Since the corporation can't be held liable, there's no reason to serve it the ticket.
Our local governments have found a means to collect more revenue to fill their empty coffers. Tax revenue at the lowest levels in decades, municipalities are scrambling to find ways to generate money without raising taxes. Photo enforcement is a nice way to supplement the loss in tax revenue. But, if the population decides that doing nothing until found is better than playing by the old rules, the municipalities that setup the photo radars may find that they are a waste of tax dollars they have tried to justify to to all of us tax payers.
www.bigboytoyinsurance.com
Wednesday, August 5, 2009
Is Auto Insurance the next Obamacare
With all the buzz and controversy about President Obama's health care overhaul, could auto insurance be on the horizon? Most states already mandate all registered auto owners maintain insurance on their vehicles. Health care has been a hot topic since ex-president Bill Clinton's wife, current Secretary of State Hillary Clinton, made it a public issue back in 1995. Now it is on the table to have the Federal government take full control and mandate to individuals and businesses what is acceptable and authorized.
If the current Obama Administration takes control of our health care industry, what's to stop them from extending that control to auto insurance? We have seen their grip on two of the largest industries in America, banking and automobile manufacturing. If Obama wants to take over the private auto insurance industry, he is poised to to do so with little Congressional opposition.
Health insurance carriers are arguing that if the Federal Government gets into private under 65 health insurance, competition will be destroyed. How can a private company compete against a government? I am not a college History Major, but I do remember in the '80's when our steel industry was suffering against he Japanese steel market. Japanese steel manufactures perfected a better smelting process that was cheaper than the American steel producers could match. Due to a huge investment by the Japanese government into Japanese steel plants, American steel producers lost their competitive advantage. After American firms figured out what was happening, it was too late. Japan subsidized the process to make their manufactures more competitive on the world market. How could U.S. steel manufactures compete against a Foreign government? The U.S. Government felt the best way to protect the American Steel industry was to subsidize it, as well. This was competition against a foreign government.
I use this example to illustrate that if we revere Capitalism in this country, then what our own government is doing is the complete opposite of free market capitalism. Federal government is not an equal player in the capitalist model. The health insurance industry will be reduced to one or two carriers that, before long, will require federal money to stay in existence. With government money comes government dictation (Fannie Mae and Freddie Mac sound familiar).
If the Federal government can conquer the health insurance market, it will give them a model to use for the auto and home insurance markets. Insurance is a way of transferring risk from the individual or business to a company, not a government. If that was the case, every government in the world would administer their country's insurance needs. We have allowed our federal government to administer and regulate our Medicare system. It was setup in conjunction with our Social Security Administration in order for our elderly and disabled to have access to adequate monetary funds and health care. If we allow the government to continue down this road, we will open the door the government to control all of our insurance needs regardless of need or want.
http://www.bigboytoyinsurance.com/
If the current Obama Administration takes control of our health care industry, what's to stop them from extending that control to auto insurance? We have seen their grip on two of the largest industries in America, banking and automobile manufacturing. If Obama wants to take over the private auto insurance industry, he is poised to to do so with little Congressional opposition.
Health insurance carriers are arguing that if the Federal Government gets into private under 65 health insurance, competition will be destroyed. How can a private company compete against a government? I am not a college History Major, but I do remember in the '80's when our steel industry was suffering against he Japanese steel market. Japanese steel manufactures perfected a better smelting process that was cheaper than the American steel producers could match. Due to a huge investment by the Japanese government into Japanese steel plants, American steel producers lost their competitive advantage. After American firms figured out what was happening, it was too late. Japan subsidized the process to make their manufactures more competitive on the world market. How could U.S. steel manufactures compete against a Foreign government? The U.S. Government felt the best way to protect the American Steel industry was to subsidize it, as well. This was competition against a foreign government.
I use this example to illustrate that if we revere Capitalism in this country, then what our own government is doing is the complete opposite of free market capitalism. Federal government is not an equal player in the capitalist model. The health insurance industry will be reduced to one or two carriers that, before long, will require federal money to stay in existence. With government money comes government dictation (Fannie Mae and Freddie Mac sound familiar).
If the Federal government can conquer the health insurance market, it will give them a model to use for the auto and home insurance markets. Insurance is a way of transferring risk from the individual or business to a company, not a government. If that was the case, every government in the world would administer their country's insurance needs. We have allowed our federal government to administer and regulate our Medicare system. It was setup in conjunction with our Social Security Administration in order for our elderly and disabled to have access to adequate monetary funds and health care. If we allow the government to continue down this road, we will open the door the government to control all of our insurance needs regardless of need or want.
http://www.bigboytoyinsurance.com/
Monday, August 3, 2009
Evidence, The Danger of Texting and Driving
According to the account described below by the Accosiated Press, texting while driving is dangerous to all on the road. The following was published on August 3, 2009, by The Associated Press only days after the Federal Government recomended a Federal ban on texting while driving. If we do not take responsibility for our own actions, the government will do it for us. If you think your driving actions are wrong, they are. Drivers need to be aware while behind the wheel. Take a few minutes out of your drive to pull over and text, read email, read Mapquest on your Smartphone. You may save a life, if not your own.
"Police say a tow truck driver was texting on one cell phone while talking on another when he slammed into a car and crashed into a swimming pool.
Niagara County sheriff's deputies say 25-year-old Nicholas Sparks admitted he was texting and talking when his flatbed truck hit the car Wednesday morning in Lockport, which is outside Buffalo.
The truck then crashed through a fence and sideswiped a house before rolling into an in-ground pool.
Police say the 68-year-old woman driving the car suffered head injuries and was in good condition. Her 8-year-old niece suffered minor injuries.
Sparks was charged with reckless driving, talking on a cell phone and following too closely."
Copyright 2009 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Friday, July 31, 2009
Texting While Driving, New Laws
Sure, for some people it is tempting when they see a text message come through on their cell phone while they are driving, to respond right away. Waiting 5 minutes or more to let Sara know that you are free to go out Friday night or letting your spouse know that chicken sounds great for dinner, is seemingly too much to ask. However, a recent study released by the Virginia Tech Transportation Institute showed that long haul truckers that text while driving were 23 times more likely to be involved in an accident than their non-texting counterparts. This is compared to drivers being 6 times more likely to cause an accident if dialing on a cell phone than not. I think they would find that number even higher if they were to do a study of every day drivers in suburban traffic, where drivers have to deal with more stop and go, red lights, cars slowing to turn, etc…
What is surprising is that 36 States have not already banned this type of activity, including Arizona. In fact, the Arizona Senate voted against a bill to ban texting while driving in June 2009. Although, the Phoenix City Council did ban texting almost 2 years ago, within their jurisdiction.
There is now Federal legislation being discussed to try to enforce a texting ban in all States. While it would be up to the States to individually implement the bans, the Federal Government would make it difficult to ignore, by withholding 25% of Annual Federal Highway funding within the State if they choose not to comply within the timeline established. The legislation is being directed specifically at texting while the vehicle is in motion, not for stopped vehicles.
Personally, in the last month, I have had a vehicle run a stop sign in front of me, had a child on a bicycle swerve towards my car, and had a driver make a left hand turn across my lane as I entered the intersection with the right of way. Each of these incidents required a quick reaction on my part to avoid a collision. You can imagine that if I had been looking down at my phone trying to text, the outcome would have been very different.
Even if you believe yourself to be driving safely, remember that you have absolutely no control how other drivers are operating their vehicles.
www.bigboytoyinsurance.com
Thursday, July 30, 2009
Health Insurance, Adverse Selection
Americans have gotten spoiled over the past 50 years with the use and function of health insurance. In the 50's, Ford, General Motors, IBM, Coca Cola, US Steel and other large firms began offering health insurance and other insurances as benefits of employment with the respective firm. It became a one-up-manship within industries in order to attract and keep talented, qualified employees. As Americans, we came to expect health insurance as something you have through your employer and the employer took care of the premium. We had/have no idea of how much health insurance truly cost because we were not paying for it. Companies would richen the plan through low deductibles, low co payments and large provider networks in order to make "us" happy. It was not until we were laid off, terminated or quit our employer did we realize the true cost of health insurance. That alone was enough to get a resume out to any company that had was hiring.
Group health insurance plans are more expensive than individual plans due to one important factor-guaranteed issue. Group plans offer health coverage to all eligible employees regardless of current health or pre-existing conditions. If you had a heart attack last week and just started your new job this week, the health insurance has to accept you through the employers group health insurance policy and pay for the heart attack treatment. That increases the cost to the plan when it comes time for the insurance company to review the past years claims. If you had the heart attack before starting the new job, the health insurance company cannot decline coverage to you.
Individual policies, non employer sponsored plans, are not guaranteed issue because of Adverse Selection. If you were diagnosed with cancer today, had no coverage in place, then applied for insurance, you would be declined. Same as if you had no car insurance today, hit another car then went to an insurance agency to apply for car insurance requesting to have the insurance company pay for the damages you caused earlier. Insurance has to be in place at the time of the loss for the insurance to cover the loss. Insurance 101.
Insurance is important to our American way of life. It offers protection against the things we do not expect. However, it seems health insurance has become a naturalized right of all Americans. Unfortunately, it is not a right but rather a mechanism for protecting our assets from total or partial loss which we are responsible for paying on our own.
www.bigboytoyinsurance.com
Group health insurance plans are more expensive than individual plans due to one important factor-guaranteed issue. Group plans offer health coverage to all eligible employees regardless of current health or pre-existing conditions. If you had a heart attack last week and just started your new job this week, the health insurance has to accept you through the employers group health insurance policy and pay for the heart attack treatment. That increases the cost to the plan when it comes time for the insurance company to review the past years claims. If you had the heart attack before starting the new job, the health insurance company cannot decline coverage to you.
Individual policies, non employer sponsored plans, are not guaranteed issue because of Adverse Selection. If you were diagnosed with cancer today, had no coverage in place, then applied for insurance, you would be declined. Same as if you had no car insurance today, hit another car then went to an insurance agency to apply for car insurance requesting to have the insurance company pay for the damages you caused earlier. Insurance has to be in place at the time of the loss for the insurance to cover the loss. Insurance 101.
Insurance is important to our American way of life. It offers protection against the things we do not expect. However, it seems health insurance has become a naturalized right of all Americans. Unfortunately, it is not a right but rather a mechanism for protecting our assets from total or partial loss which we are responsible for paying on our own.
www.bigboytoyinsurance.com
Wednesday, July 22, 2009
Progressive Insurance, Behavior Insurance
Progressive Insurance is introducing a new means of tracking their customers driving habits by having customers voluntarily install a device in their car(s) that track several driving characteristics such as braking frequency, braking severity, actual mileage and actual times in order to pinpoint rating models. The pilot program is being launched in Texas next month and they are offering an initial 10% rate discount to the first "trial" customers.
The intent of Progressive Insurance's new driver tracking device is to make insurance individualistic. By tracking customers driving habits to the exact degree, they can tailor rates to that specific customer without having to rely on the customers responses to underwriting questions or expensive databases.
Progressive will also use the information to predict frequency and severity of accidents in order to assist in reducing claims expenses. Insurance companies make money through two primary means: premiums and investments. Insurance companies spend money through two primary means: operating expenses (payroll, fixed expenses, supplies, etc.) and claims. If an insurance company can reduce claims expenses without raising rates, it increases profits without compromising market share. This is the ultimate goal of Progressive's new tracking devise.
We'll see how effective their new "gadget" will influence the rest of the private auto insurance market over the next 12 months. If they are able to increase profits without raising rates and other insurance companies take notice, then Progressive can call it a success.
http://www.bigboytoyinsurance.com/
The intent of Progressive Insurance's new driver tracking device is to make insurance individualistic. By tracking customers driving habits to the exact degree, they can tailor rates to that specific customer without having to rely on the customers responses to underwriting questions or expensive databases.
Progressive will also use the information to predict frequency and severity of accidents in order to assist in reducing claims expenses. Insurance companies make money through two primary means: premiums and investments. Insurance companies spend money through two primary means: operating expenses (payroll, fixed expenses, supplies, etc.) and claims. If an insurance company can reduce claims expenses without raising rates, it increases profits without compromising market share. This is the ultimate goal of Progressive's new tracking devise.
We'll see how effective their new "gadget" will influence the rest of the private auto insurance market over the next 12 months. If they are able to increase profits without raising rates and other insurance companies take notice, then Progressive can call it a success.
http://www.bigboytoyinsurance.com/
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