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It has long been itching to write a small “guide” on this topic with clearly spelled out specifics for beginners. Basically, I see many different people and what common problems they have, but in my opinion, from the outside.
I would like to see the insurance problemsinsurance problems through the eyes of a beginner and for this I need help from those present who can share their personal experience or the experience of friends.
What’s troubling? Where are the misunderstandings? What are we plunging into against our will? Who offends us and how exactly? Is there any point at all in Car insurance other than the inevitable obligation? Are you interested in anything other than price? Do you need an agent at all or is it better to just insure online?
Thanks in advance to everyone who speaks out. And I will sculpt a “brick” taking into account the people’s pain and post it on the forum. Then the members of the forum chase him from all sides and, with modifications, there will be a worthy and useful collective project.
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plays an extremely important role both in the life of the entire American society and in the life of an individual family. We will talk about car insurance simply because every person faces this almost immediately upon arrival in the country.
The need for other types of insurance arises later, as income rises, real estate emerges, prepares for retirement, etc. We will talk about this elsewhere.
The main attention will be paid to the following issues:
- Why you need to insure
- Coverage: what exactly we need and to what extent
- What affects the cost of insurance. What can and cannot be saved on.
- How insurance companies sell insurance policies
- Where and how to buy insurance - agents, brokers, direct (online, by phone, etc.)
- ■■■■■■■■ - Myths and reality of auto insurance and American life in general
- Kidalovo and how not to become a victim of crooks
- What to do in typical problem situations
Insuranceis regulated by law at the state level, not at the federal level. From this follows a very simple and important
1 - You can only trust the information received from an insurance specialist in your state. Any information for other states may be completely inapplicable outside of these states.
Our story will be conducted in relation to the state of ,Californiaand which the author of these lines is a licensed insurance agent. In almost all states (there are exceptions), car insurance is mandatory in terms of LIABILITY (civil liability), that is, if a stranger is injured by us.
The amount of coverage required varies from state to state. For example, in California this amounts to up to $ 15,000 bodily injury for one victim and up to $ 30,000 for more than one. In addition, liability for damage to someone else’s property is provided - $ 5,000.
All this is calculated per exident.
Fractional notation is commonly used to express coverage dimensions. The 15/30/5 record corresponds to the California coverage described above that every driver is required by state law to have.
Driving without insuranceDriving without insurance is a serious crime and severely punished. Life advice: Never enter into any relationship with people who drive a car without insurance or argue that it is possible, justify why this type of crime is okay. These people are on their way to big trouble - you don’t need to keep them company.
According to police statistics in the state of California, 28-30% of drivers have no insurance at all.
Add to this the same percentage of people who have the minimum coverage required by law, and you will understand that if something serious happens to you on the road, there is almost no chance of getting money from the culprit.
Hence Conclusion No. 2 - You cannot expect that in case of trouble you will be covered by someone else’s insurance - you need to have your own.
- At Fault (for example, California - the victim is paid by the insurance of the perpetrator of the accident)
- No Fault (for example, Arizona - regardless of fault, your insurance will cover your damage)
Conclusion No. 3 - You need to know what system is in the state, where you live or intend live.
If a person is practically a beggar and is going to remain practically beggar for the rest of his days, then driving without insurance does not bother him financially - he has nothing to take.
In all other cases, the amount of insurance must protect the driver from the seizure of his property and income (including future income) by court.
In addition, when discussing why a driver needs to be insured, we should know that there are no other occupations in our life that approach the danger of driving a car. Therefore, it is worth asking a question like “Am I such a ■■■■■■■ that I will risk the life and health of other people in order to save ten or two a month on their crippled life? "
So the minimum insurance for Californiais 15/30/5, what do you think should be the optimal LIABILITY for the average layman? For example, in Russia, liability for damage to someone else’s property is $ 4,000, I usually expand it to 10,000.
A person cannot be judged for an amount greater than his assets, which includes bank accounts, equity in real estate, shares, and, which is very important for beginners, garnishment of wages (deduction from wages for 10 years in advance from all family members in the amount of 25 %).
That is, there is nothing to take away from a young family that arrived a month ago. But, for 10 years, a husband and wife can earn together, for example, 160 thousand per year.
Then 400 thousand dollars can be deducted from them for 10 years.
In what situation will the court take away everything that he has from the person responsible for the accident? - in case of death of a person, in case of disability.
The amount of damage also depends on the consistency of the victim.
Pain and suffering of a serious lawyer or doctor who has been in a cast for three months is much more expensive than the same for a construction worker.
Obviously, we, as drivers, cannot control how many other people’s cars we damage in the event of an accident, nor their prices, nor the number of drivers and passengers traveling in them, nor the severity of their injuries, nor the cost of their subsequent treatment.
Therefore, to determine the amount of insuranceamount of insurance liability, we proceed from the worst.
Something so bad happened through our fault that they want to take away everything that is possible from us, to the maximum.
How much can you take away from us if you take away everything, including 25% of the salary for the next 10 years? For this amount, you need to insure liability in that part of it that is responsible for damage to human health (Bodily Injury - the first two components of our fraction). Very soon the time will come when the $ 500,000 maximum coverage offered by auto insurance will not be enough.
Then we need additional coverage in the form of Umbrella Insurance. The need for coverage changes over time. Where do we get a very important
The amount of insurance coverage should be periodically reviewed, commensurate with the growth of potential liability.
UninsuredUninsured Motorist Bodily Injury (UMBI) - covers our moral and personal injury in the event that we are injured by an uninsured (or insufficiently insured) driver.
That is, if the culprit of the accident does not have sufficient Liability Coverage. Accept to take this coverage in the same amount as we take Liability on our car, no less.
The principle is that you need to insure yourself no worse than we insure other people from ourselves.
Uninsured Motorist Property Damage (UMPD) - covers damage to our vehicle in similar circumstances, that is, if we are injured by an uninsured (or insufficiently insured) driver.
If we ourselves have damaged our car, then the damage will be covered either under the Collision article (physical collision with a car, house, curb, overturning) or under the Comprehensive article (everything else - collision with an animal, theft, vandalism, hail, flooding, etc.) …
Collision and Comprehensive can be bought with different deductible (the amount paid to the insured before the insurance company starts paying).
Choosing a larger deductible, a person saves on the cost of insurance, but loses in the event of an accident.
If a person has been driving trouble-free for many years, then it makes sense for him to think about a high deductible for Collision, for example, $ 1,000 For Comprehensive, which costs ridiculously little, you can go for $ 250, since there is not much to save on.
Medical Coverage is an interesting coverage. Several thousand dollars, usually 2-5 thousand, purchased under this item, are spent without finding out the culprit.
If you need medical assistance for a large amount, then the expense will go with the Liability of the culprit.
Here, the culprit is not identified. If you need help (bandage, put a cast, go to the doctors for several appointments, X-rays, etc.) - now, there is money. The idea is that a person who was immediately helped and treated humanly will not be sued as often as an offended person.
There is an opinion that in order to save money, it is better to do LIABILITY in a little-known, small insurance company.
In the event of an insured event, the other side will deal with the insurance (that is, the one we hit), and how he will do - we do not care.
Is this statement correct? Maybe this is a really good option to save money, especially for drivers with no experience (according to documents) driving in the USA (for example, a newcomer)?
There is an opinion that in order to save money, it is better to do LIABILITY in a little-known, small insurance company.
An auto insurance policy is not a bunch of junk that can be picked up elsewhere. This is package. It is impossible to take Liability specifically elsewhere than everything else. So the offer comes down to taking insurance with a ■■■■■■ company where other people don’t go. This is bad logic.
In addition, Liability is very cheap compared to Property Damage - it is impossible to save money there. That is, this is the reasoning of very incompetent people.
There is one more aspect. A beginner, if everything is in order with his brain, should understand that he is a beginner, not a guru. Therefore, the best behavior strategy is to have a good agent (not from the Internet, but by recommendations) in a decent company. And already he will take care of saving his money and that the ■■■ is not substituted. This will save much more money than any other way.
There are quite a lot of factors affecting the cost of insurance and, what is important to know, there are differences between companies in how they look at certain problems and in what kind of discounts and what they are offer.
Moreover, it is very important to understand that an agent or broker representing a particular company knows about ways to reduce the cost by an order of magnitude more than we can think about it from the outside.
Moreover, among experienced and knowledgeable agents there are those who work with a large number of new emigrants - they know more nuances of how to get the best price out of the system. Because insurance for beginners has its own characteristics.
So, the cost of insurance is influenced by:
- car (price, age, model, availability of some installed technical details). The agent, entering the VIN (vehicle identification number) - 17-digit combination of numbers and letters, instantly receives all the information about the vehicle in its factory production.
- car use (commute, pleasure) and annual mileage (mileage). When answering questions about mileage, newbies often say something inappropriate, for example, 10 thousand a year. Excuse me, there is no work, or he or she walks (rides by tram).
Where are 10 thousand from? Why pay for something that is not yet a fact of life? Very often people have inflated numbers.
- driver - driving experience, tickets and exits for the last 3-6 years
- territory, literally zip code of the place where the car stays overnight
- a set of coverings (liability, property, medical, towing, rental car, glass deductible buyback)
- the amount of coverage and the selected deductible
- special discounts (discounts)
1.2 or more cars in a family if they are insured by the same company
2.the presence of renters insurance or home insurance in the same company where the cars are insured
- Profession (the list is quite long) - engineer, doctor, teacher, etc. This discount applies to all drivers in the family.
- Insurance experience with this company (persistency discount)
Keep in mind that the criteria by which it is determined to give or not to give one or another discount vary greatly not only from company to company, but, oddly enough, from agent to agent working for the same company. For example, you give an agent your foreign diploma. He twirls it in his hands and says:
- agent # 1: We do not count foreign diplomas
- agent # 2: You must evaluate him. Here’s the phone. Pay 200 dollars, get a certificate in a month, send it to me. Without this, I cannot give a discount (15%).
- Agent # 3: Let’s make a copy now. Then I will translate it myself and put it into production. You will receive a discount from the first day.
All three agents know their stuff, but their knowledge of some details is different. The first has no experience of working with foreigners. The second only knows the formal requirements, but does not know how the underwriting department actually works. The third one knows what the underwriter is looking at and makes an adequate translation that suits everyone.
There are good and at the same time cheap coatings, on which, in principle, nothing can be saved simply because it is so very cheap:
- Uninsured Motorist ($ 8-10-12 per month)
- Comprehensive. I advise you to have a minimum deductible - $ 250, for example. The difference between 250 and 1000 deductible will be a couple of dollars per month.
The most expensive part in car insurance is Collision, which is understandable - the car is beaten and needs to be repaired. By manipulating the deductible in this coverage, we see a very significant difference in price.
In principle, the cost of Liability is comparable to the cost of Collision, but in Liability we can only manipulate the amount of coverage, which is absolutely unacceptable, otherwise we risk very serious losses in the event of a serious accident. Therefore, if you need to stay within a modest budget, then increase the deductible, but do not touch Liability.
You can also get rid of some comfortable, but not critical coverings, such as a rented car.
From all of the above, I would draw only one fundamentally important conclusion for a beginner:
- Do not insure online or by phone - it is dangerous and too expensive. You need an agent or broker to whom you will come to the office, sit next to him at the computer and interactively work with him for half an hour on your insurance.