Loan/Lease Gap Insurance

How Can You Cover the Gap?

   You just bought your dream car 6 months ago. You have been very careful. No one is allowed to eat or drink in your car. You stop fully at every stop sign. You stay a full car length behind every car you drive behind. But it doesn't matter because one day someone else doesn't stop at the stop sign. 
   Your dream car is totaled. And then you find out that not only is your car gone, but the insurance isn't going to cover the total amount you owe on your loan. Now what? 

Want a better scenario?
   When you buy a new car, many carriers (and dealerships!) offer an optional coverage;  
Loan or Lease Gap coverage. With this coverage, if you have a total loss, you would be covered for the difference in the your now totaled cars value and what you owe. So one way you can decide if it is worth the premium, is to ask yourself if you can pay that difference out of pocket?

Where can you get Loan Gap coverage?
   When you buy a brand new car, the dealership will usually offer you this coverage. Before you take it, call your insurance agent. (You need to call them anyway to add your new car!) They should offer the Gap coverage to you, but if they don't, ask about it. It is usually inexpensive to add this optional coverage. I just added the coverage to a policy yesterday and it only added $17 annually. That is a great price to save you possibly thousands down the road. Most carriers I know offer this coverage on cars less than 2 years old. 

What about Lease Gap coverage?
   If you are leasing a car, ask if your contract includes this coverage. Many do, which would be very convenient! If not, most carriers offer the coverage on lease cars also. Keep in mind, this coverage only applies in the case of a total loss.  As always, it is up to you whether or not you add optional coverage. Take a look at the premium vs. the gap and decide which one you can live with.

If you have any questions about your home, auto or business insurance, 
email Brockman Premier Insurance or call 877-987-8683 
Be sure to visit our website!

   

Insurance Renewals

Why Did My Rates Go Up?

   This is the most frequent question agents hear at renewal time. Sometimes rates go down, but most often, they go up, especially if we are talking about homeowners premiums. I know what you're thinking, "I didn't file a claim, so why did the rates go up?"
   So many factors affect home insurance rates. Claims are a big factor, but it isn't just claims. You may not have filed a claim, but others in your area did which impacts your rates. It doesn't seem fair, but you should think about the carrier paying out those claims. Let's say the carrier budgets $1 million for claims this year. But they had to actually pay out $1.5 million. That extra $500,000 has to come from somewhere, so they raise rates the next year to help make up the difference.
   Keep in mind, carriers cannot just decide to raise rates. Insurance is a highly regulated industry. Each state has its own insurance regulatory agency. Carriers have to file rate changes with the state agency and wait for approval. Usually the clients most affected would be those with lower credit scores (sorry!), those in areas of extensive claims and those who have filed claims.
   There are a few things you can do when you have a rate increase. The first thing you can do is shop for better rates. If you have an independent agent, ask them to shop for you. (Do not assume they will re-quote without you asking them to.) You should also ask your agent to review your coverage. You may be paying for coverage you don't need. Or you may need coverage you don't have (this, of course, will raise your rates).
    Watch for your renewal. You should get your renewal within 45 days of the renewal date. Your agent should be on the look out for it, but the responsibility is yours. You should know your coverage, your policy dates and how the payment will be made. Home carriers will mail (yes, snail mail!) your renewal to your mortgage company requesting payment. If you have changed mortgages during the policy period, you need to tell your insurance agent. Otherwise, they will send it to the wrong mortgage company and it won't be paid. You should also let your agent know if there have been any changes to your contact information. You would be surprised how many times I have not been able to get a hold of someone because I don't have their new phone number or email address.

If you have any questions about your home, auto or business insurance, 
email Brockman Premier Insurance or call 877-987-8683 
Be sure to visit our website!

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