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What does Comprehensive Car Insurance cover? | Michigan Auto Insurance

posted by Jason Grubbs   [ updated ]

When people say they either want or are required to carry "full coverage" on their Michigan auto insurance policy they are referring to insuring their car for physical damage.

Physical damage is optional car insurance and is comprised of two coverage options: Comprehensive & Collision.
These two types of coverage are commonly confused - both insure your car, but cover different types of damage.

Comprehensive coverage, sometimes referred to as "Other Than Collision", insures your vehicle for damages other than a collision with another car or object.
Michigan Auto Insurance Graphic

Comprehensive coverage includes:

  • Theft
  • Fire
  • Vandalism
  • Weather-related damage (hail, wind, flooding)
  • Falling objects
  • Hitting a deer or other animal
  • Glass breakage

How much Water Backup Coverage do I need? | Michigan Home, Condo Insurance

posted Feb 14, 2018, 1:00 PM by Jason Grubbs   [ updated Feb 14, 2018, 1:02 PM ]

Water Backup - Michigan Home, Condo Insurance
Did you know?

Damages resulting from water backing up through a sump pump, sewer, or drain are not covered by a typical Michigan home or condo insurance policy.

Insurance companies offer water backup coverage, but it's an optional coverage you add on to your policy - either as a standalone rider or, in some instances, a limited amount of coverage may be included as part of a package of additional coverage benefits.

While coverage isn't automatically included water backups are one of the most common types of losses that Michigan home and condo owners experience.

One of the reasons Michigan homeowners frequently suffer water backup losses is many home and condos have basements below ground level that are more likely to experience this type of damage.  These homes often rely on sump pumps to divert water runoff, whether from heavy rains or snowmelt, away from the house.

The problem is things can, and often do, go wrong - the volume of water can overwhelm the system, a power outage or mechanical failure can result in a pump failing, blockages when a service line is clogged or frozen - any number of situations can result in water backing up into a home potentially causing thousands of dollars of damages.

Recognizing the frequency of these types of losses many insurance agents include a level of water backup coverage whenever they're quoting or writing a home or condo insurance policy.  At our agency, unless a home or condo owner specifies otherwise, we include at least $5,000 of water backup coverage with every policy.

The dilemma is even $5,000 may not be enough for many homeowners.  A water backup that results in even a few inches of standing water in a finished room or basement can add up to significant expenses between the cost of removing the water, cleaning up, and repairing or replacing damaged flooring, walls, appliances, furnishings, and personal belongings.

The cost to add or increase water backup coverage is modest - $5,000 of coverage will cost about $60 annually with the cost per thousand dollars of coverage decreasing at higher coverage limits.

If a water backup in your home or condo could cause significant damage you would be well advised to confirm your current coverage and make any adjustments needed to adequately protect your home.

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What is Uninsured & Underinsured Liability coverage? | Michigan Auto Insurance

posted Feb 6, 2018, 1:43 PM by Jason Grubbs   [ updated Feb 6, 2018, 1:45 PM ]

Michigan Auto Insurance Policy
Within every Michigan auto insurance policy there is a portion of the policy that responds if you, as either the driver or owner of a vehicle, are responsible for injuring someone else.  This is known as Bodily Injury Liability coverage.

This part of auto insurance is pretty widely understood: It's a significant portion of the state-mandated coverage required for every vehicle in order to be legal to operate on Michigan roadways.

What can be a little confusing to most folks are two separate, but related coverage options commonly included with Michigan auto insurance policy: Uninsured & Underinsured Motorist Liability coverage.  On the declarations pages (the pages summarizing an individual's auto policy) these coverage options may be displayed as "uninsured/underinsured" or even simply UM/UIM.

While Bodily Injury Liability protects you in the event you are legally responsible for injuries to someone else, Uninsured and Underinsured Motorist Liability protects you if you are injured and the at-fault party either doesn't have any auto insurance whatsoever or has an auto policy, but doesn't have sufficient coverage to pay for your damages.

An example may help illustrate both possible situations:

A driver is texting, runs a red light, and crashes into your vehicle causing you to suffer serious injuries.  Based on the extent of your injuries you may be legally entitled to recover damages from that driver.

Now, imagine the driver that hit you had no insurance (according to a recent WZZM13 report 1 in 5 Michigan drivers are uninsured).  The likelihood is an uninsured driver also wouldn't have sufficient cash or assets to pay for your damages.  You would still be able to collect from your own auto insurance policy (up to your coverage limit) under Uninsured Motorist Liability coverage.

In that same scenario, let's imagine the driver who hit you had insurance, but the limit of their coverage wasn't enough to pay for your damages (the most common Bodily Injury Liability coverage limit I encounter when reviewing prospective client's insurance policies is a woefully inadequate $100,000 per person).  The damages you are legally entitled to recover may be considerably more than the at-fault driver's insurance coverage - you would be able to collect the difference from your own insurance policy (again, up to your coverage limit) under the Underinsured Motorist Liability coverage.

One tremendous advantage of Uninsured & Underinsured Motorist Liability coverage is a judgment against the at-fault party is not required to establish the level of your damages and collect from your auto insurance policy.  Your insurance company will work with you to determine the extent of your damages and can then, in turn, pursue the other driver to get paid back (known as subrogation).

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Does my auto insurance cover damage caused by potholes? | Michigan Auto Insurance

posted Jan 11, 2018, 8:56 AM by Jason Grubbs   [ updated Jan 11, 2018, 10:53 AM ]

Auto Insurance - Pothole Damage
The freezing and thawing cycle of Michigan winters are notorious for leaving roadways throughout the area ravaged by potholes.  These potholes are often the culprit for vehicle damages including tires, rims, suspension - in some instances even damages to the body of your car.

A question that naturally arises when a motorist suffers the misfortune of striking a pothole or other debris in the roadway is whether their Michigan auto insurance policy covers this type of damage.

The good news is hitting a pothole or other debris in the roadway would be covered providing your auto policy includes collision coverage the vehicle involved.

The bad news, according to his MLive article, is the majority of insurance companies consider these types of incidents at-fault accidents.  This means your collision deductible would apply and filing a claim would affect your future rates and, potentially, your eligibility for insurance.  Depending on the extent of damages it may not be in your best interest to turn in a claim in this situation.

Insurance companies that consider hitting a pothole or other debris in a roadway an at-fault accident reason a person driving safely and maintaining proper distance between vehicles should be able to see and avoid road hazards.

In my opinion, that reasoning is flawed: A person can be driving perfectly safely and still encounter a pothole or other hazard in the roadway that they are unable to avoid.  In some instances a pothole filled with snow or water may not even be visibly discernible as a hazard before a driver encounters it.

Fortunately, some insurance companies differentiate themselves by providing a more common sense interpretation for these types of occurrences.  Our premier company, Fremont Insurance, states: "We hold to the principle that if an insured strikes an object in the roadway that they wouldn't reasonably expect to be in the road (excluding animals)* it is considered a not-at-fault collision loss."

If you've received a disheartening response to a potential claim inquiry from your insurance company it may be worthwhile to reconsider whether your insurance policy is providing the best value for your premium dollars.


* Striking an animal in a roadway would be covered under the comprehensive coverage portion of an auto policy.


How to update your auto insurance when changing vehicles | Michigan Auto Insurance

posted Jan 5, 2018, 7:51 AM by Jason Grubbs   [ updated Jan 5, 2018, 7:53 AM ]

Auto Insurance - Changing Vehicles

Whether it's time to replace an aging vehicle or if you're simply acquiring another vehicle you will need to update your auto insurance to properly insure your newly acquired vehicle, satisfy any loan or lease requirements, and be able to register and obtain a license plate for your new vehicle.

What information will your insurance company need?

With regard to specifics of the car you're acquiring the insurance company will need the year, make, model, and vehicle identification number (VIN) for the vehicle you are purchasing.

Vehicle Identification Number (VIN)
  • For any vehicle built since 1981 the VIN will be 17 digits long
  • Each VIN confirms information, including safety features, specific to the vehicle
  • The letters I(i), O(o), & Q(q) are not used in a VIN to avoid confusion with the numbers 1 & 0
  • Confirming the VIN is accurate on insurance documents is important to avoid potential problems when registering your vehicle, renewing a plate, or documenting to a lender you are maintaining required insurance on your vehicle
Your insurance company will need to confirm the date the new vehicle should be insured, whether this is an additional vehicle or replaces an existing car, the primary driver & use of the vehicle being added to your policy, and the specific coverage you want for this vehicle.

If you are leasing or purchasing a new car you may want to ask your agent about additional coverage options, such as loan/lease gap and new vehicle replacement, that may be worthwhile.

Finally, the insurance company will also need to be informed whether the vehicle will be leased or financed and, if so, through which financial institution and how the lender or leaseholder needs to be listed on your insurance policy (the dealer or lender should be able to provide this information).

What if you purchase a car after office hours and aren't able to immediately contact your insurance company?

Most auto insurance policy automatically extend coverage for a newly acquired vehicle, providing a window of time for you to notify the insurance company and update your policy.

This means if you buy a car in the evening or during a weekend you should be safely covered driving your new car and can notify your insurance agent when their office is next open.

If you are purchasing a car from a dealer the dealer may require insurance documentation to complete the transaction, so whenever possible it's advisable to speak with your insurance agent beforehand.  In those situations your insurance agent should be able to provide documentation in advance to prevent any unwelcome delays finalizing your purchase and driving home with your new vehicle.  The agent would then confirm the purchase and tidy up details afterwards.

It's worth mentioning it can be well worth your time to check insurance costs before you commit to purchasing a specific vehicle.  Our article, "Does the kind of car I drive affect my insurance rates?", details how insurance companies rate different vehicles.  Your insurance agent can assist you when researching a new car by providing quotes comparing insurance prices for any vehicle(s) you are considering purchasing.






Who is responsible when a tree falls? | Michigan Home, Condo Insurance

posted Dec 12, 2017, 8:41 AM by Jason Grubbs   [ updated Dec 12, 2017, 8:41 AM ]

Tree Damage - Michigan Home, Condo Insurance
When a tree falls there can be resulting damages both for the property owner and, potentially, neighboring property owners.

A common question is who is responsible for any resulting damages if a tree falls on a neighboring property?

The answer, which often surprises people, is each affected property owner would typically be responsible for damages to their own property.

The reason for this is a tree falling is considered an act of god - an unforeseen event the property owner could not have predicted or reasonably been expected to take action to safeguard against.

There is an exception to this rule, although qualifying for the exception requires specific action be taken beforehand by a neighboring property owner.

If a tree is clearly dead or dying and poses an imminent hazard to a neighboring property and the owner of the property where the tree is located has been advised of this, requested to take action to prevent damage, and fails to do so within a reasonable period of time they would be liable for any resulting damages if the tree should then fall.

The key in that situation is the concerned neighboring property owner has to be able to prove they notified, in writing, the property owner of the hazard and that property owner then failed to take action in a timely fashion to prevent damage.

What is a reasonable period of time? That's a little more subjective, but clearly you can't hear a weather report that there will be high winds within the next few days, jot on a scrap of paper "Do somethin' 'bout your tree!", slap the note on the neighbor's door, and expect they are then responsible if their tree falls within a day or two and damages your property.  The property owner would need some reasonable period of time to have the hazardous tree removed.

The benefit of taking action, when a neighbor's tree poses a hazard to your property, is - first and foremost - hopefully by doing so you can avoid any damages resulting from a hazardous tree falling on your property.

If the neighbor doesn't take action and the tree falls you can also potentially avoid significant expenses as the neighbor would then be responsible for the damages.  Even if you own insurance may otherwise have responded you would have been responsible for any applicable deductible(s) and filing a claim against your own insurance may also increase your rates.

See our related blog "What happens when a tree falls?" for additional information detailing which policy responds and what to expect from your insurance when a downed tree causes damages.

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What happens when a tree falls? | Michigan Home, Auto Insurance

posted Dec 8, 2017, 11:42 AM by Jason Grubbs   [ updated Dec 12, 2017, 8:44 AM ]

Fallen Tree - Michigan Insurance
While tornadoes are, thankfully, relatively infrequent in West Michigan we do routinely suffer damages from high winds and storms. There storms frequently down trees resulting in expenses for property owners to remove tree debris, repair damaged structures, and repair or replace other items a downed tree may damage.

In this article we'll examine which personal insurance policy responds and what to expect from your insurance when there are damages resulting from downed trees.

In our related article "Who is responsible when a tree falls?" we more closely examine the question of responsibility if a tree falls on a neighbor's property.

Tree(s) downed on the premises
What happens if a tree is downed in your yard without damaging any structures or other property?

This is one area where there can be considerable differences between individual insurance companies and the coverage their policies provide that most people don't recognize beforehand or even think to inquire about when they are shopping for home insurance.

Some home insurance policies provide no coverage whatsoever for tree debris removal expenses if a tree is downed on the property without damaging a covered structure. Other home policies will provide limited coverage for tree debris removal, typically ranging from $500 to $1,000 per occurrence.  Coverage is customarily subject to the policy deductible.

Tree(s) downed on a covered structure
Tree Damage - Michigan Home Insurance
In addition to insuring the house, home insurance policies typically provide coverage for additional structures on the premises including detached garages, storage sheds, pole barns, fences, and pools.*

When a tree is downed on the house or another covered structure the home insurance policy will cover resulting damages to the structure - subject to the policy deductible and any applicable coverage limits.

There may still be limitations for the cost of removing tree debris when a tree falls on a covered structure, although the tree debris removal and structural damages would be considered one claim with the policy deductible only applying once to the cost of removing the tree debris and repairing the structure.

Tree Damage - Michigan Auto Insurance
Tree(s) downed on a car, boat, motorcycle, snowmobiles, recreational vehicle, or travel trailer
A home insurance policy generally will not provide coverage for damages to any of these types of vehicles - items that are designed to be insured separately.

Regardless of whether they are stored in a garage or another building on the property, the only coverage for these types of vehicles would be if they are separately insured for physical damage.  Typically they would be insured on a separate policy although certain types of recreational vehicles may be eligible to be insured on a rider added to a home policy.

This is another area where there can be a noteworthy difference between insurance companies that isn't accounted for by simply comparing the price of their policies.  There are some insurance companies that will only apply one deductible if there is a loss covered by multiple policies.  What this means is if a tree falls damaging a garage and a vehicle parked in the garage, if both the home and vehicle were insured with one of these companies, only the larger of any applicable deductibles between the home and auto policies would apply to the combined loss.

* It is always advisable to discuss, with your agent, coverage for any detached structures on your property. Depending on the combined value of detached structures there may be a need to adjust policy coverage and/or depending on the use of any building(s) they may need to be separately insured.

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Understanding No Fault Insurance | Michigan Auto Insurance

posted Oct 24, 2017, 12:58 PM by Jason Grubbs   [ updated Oct 24, 2017, 12:59 PM ]

Michigan No-Fault Auto Insurance
Based on conversations over the years I've realized it's not uncommon for most people to be a little confused by no-fault auto insurance.

When there is an accident, under Michigan no-fault insurance, your own auto insurance company responds for your damages - regardless of who was at fault.

Understandably that can seem, on first glance, counterintuitive.  After all, it only seems fair that if a person was at fault in an accident then that individual - or their insurance company - should be responsible for any resulting damages.

There are a couple of guiding principles behind no-fault auto insurance:

One being your own insurance company should have more of a vested interest in settling a claim for you, as their client, promptly and fairly.  Regardless of fault, an insurance company that has no direct financial relationship with you has no financial stake in resolving a claim expediently and to your satisfaction.

This is also intended to cut down on lawsuits as consumers don't have to sue to establish legal responsibility and compel an insurance company to pay for damages.

A second notion behind no-fault auto insurance is each consumer can individually determine (to a certain extent) what coverages they want to carry on their own auto insurance policy.

While there are auto insurance requirements mandated by the State of Michigan those are for relatively minimal liability coverage and medical and work loss benefits.  There is, however, no state requirement that an individual insure their vehicle for physical damage.

Adding to the confusion about Michigan no-fault auto insurance there are also a few exceptions wherein the at-fault party can be responsible for damages.  The exceptions include:
  • Serious injury, death, or dismemberment: In these situations while your own insurance company would still respond for medical bills and lost wages there can be recourse against an at-fault party for pain and suffering.  This provision allows an injured party to obtain financial compensation for a diminished quality of life resulting from injuries caused by another driver.
  • Parked vehicle: When your car is legally parked it considered property when damaged by another driver.  If another driver hits your parked car they would be responsible for the damages - basically the same as if they hit your mailbox.
  • Mini-tort claim: Under this provision the at-fault party in an accident can be responsible for up to $1,000 of the damages to another person's car if those damages are not covered by that person's own insurance.  This exception is intended to provide a modest amount of relief for a not-at-fault party that properly insured their own vehicle, but doesn't carry collision coverage or has a deductible that applies to any coverage afforded by their own policy.
As auto insurance differs from state-to state there are also exceptions if you happen to be involved in an accident in another state or if you are involved in an accident in Michigan with a non-resident who is driving a vehicle registered and insured in another state.


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How To Be A Smart Insurance Buyer | Michigan Insurance

posted Oct 11, 2017, 1:54 PM by Jason Grubbs   [ updated Oct 12, 2017, 7:29 AM ]

Ask Questions When Buying Insurance
A few years ago my wife and I purchased kayaks and a trailer.  The salesperson was friendly, informative, and offered several worthwhile suggestions regarding equipment and accessories.  While the salesperson was helpful there were items we wound up purchasing that he didn't immediately suggest.

As an example, we didn't like the idea of simply strapping our kayaks to the trailer as they could easily be damaged while being transported.  When we expressed that concern the salesman recommended saddle cradles typically used for car rooftops that were able to be added to the trailer crossbars to provide a secure mounting system for each kayak.

When we questioned the potential for theft if we used basic straps to tie down each kayak that salesman brought to our attention available theft-deterrent, locking straps.  For each potential concern we expressed there were accessories available.

In my estimation, the salesman didn't do us a disservice by not immediately suggesting all of the equipment and accessories we wound up purchasing.  The purchase process required our participation: we thought about what was important to us and asked questions to make certain we had the proper equipment and accessories to meet our needs and expectations.

Throughout my career I've found there is seldom this level of participation when people are buying insurance.  More often there is a misconception that basic insurance policies will provide coverage for every need and expectation.

The reality is there is an extensive array of additional coverage options available with most insurance policies.  These coverage options are available to custom-tailor each policy to meet your needs and expectations, but it requires asking questions and identifying those needs and expectations when working with your insurance agent.

Take auto insurance as an example:
  • Do you need roadside assistance coverage in the event your vehicle needs to be towed or if you need some type of service for a lockout, flat tire, or dead battery?
  • Do you need additional coverage to pay for a rental car if your car is out of service due to a covered loss?
  • If so, how much coverage - per day - would you need for a rental car? (A good example as $30 a day may be enough to pay for basic transportation, but what if you routinely transport kids and equipment and may need to rent a more sizeable, higher cost vehicle like an SUV?)
  • Are you financing or leasing a new vehicle and may need gap coverage?
Home insurance offers an even wider array of additional coverage options to provide coverage for guaranteed home replacement, personal property replacement, valuable items (including jewelry, fine arts, and collectibles), water backup, tree removal expense, refrigerator & freezer contents, identity fraud, home businesses, personal electronics, service lines, sinkholes, shoreline property for waterfront homes, and increases in repair costs to comply with local ordinances and laws.

A good insurance agent is going to take time to ask questions intended to help design a policy that meets your needs and expectations.  The likelihood of buying an insurance policy with coverage options tailored to your situation increases when you take an active role participating in the purchase process.

An excellent example is one of my clients recently expressed concern as they lives in an area where there have been issues with sinkholes.  While additional coverage is available for sinkholes it is somewhat costly and isn't an option most people would choose to pay the extra cost to include with their home insurance policy.  In that case the client helped me identify a need I was able to address with an additional coverage option appropriate for their unique circumstance.

The important takeaway from this article is to be actively involved when purchasing insurance.  Think about what could happen, ask questions, and participate to be certain your insurance policies will respond as you may need and expect in the event of a loss.

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Insurance concern home buyers should address BEFORE signing a purchase agreement | Michigan Home, Condo Insurance

posted Aug 30, 2017, 8:39 AM by Jason Grubbs   [ updated Aug 30, 2017, 10:25 AM ]

Home Purchase - Michigan Home Insurance
Your heart is set on purchasing your dream home or condo in Michigan.  You've earnestly begun negotiations with the sellers - haggling over price, working with your realtor to outline seller and buyer responsibilities to be completed before closing, targeting a date for closing, and - frequently these days - agreeing how long the sellers may remain in the home after the closing.

While delays where sellers remain in a home after closing are common and purchase agreements typically stipulate the seller is required to pay for any repairs or replacement necessitated by misuse, abuse, or neglect of the property one valid concern most purchase agreements fail to address is what happens if there is an insurance-related loss while the seller is still living in the home?

An insurance claim for damages to a home or other structures on the property that occurs after the closing date customarily is the responsibility of the home buyer and their insurance company.

What this means is if an unforeseen claim occurs - say a pipe bursts in a wall - during the period of time following closing while a seller is still living in the home they no longer own the claim goes to the home buyers insurance company and the new homeowner is also responsible for paying, out-of-pocket, their insurance deductible.

While accidents happen, as you can well imagine, most new homeowners are understandably none too pleased to file a claim against their new insurance policy and pay their deductible (typically $500 - $1,000) for a loss the occurs before they've even taken possession of their new home.

Since you own your new home once the closing is completed there isn't really any effective way for a home buyer to avoid being stuck with a claim if an insurance loss occurs before they've taken possession of their new home.  There is, however, a simple solution to minimize risk and expense for a homebuyer in this situation.

A clause can be added to the purchase agreement stipulating the seller would be responsible for the buyers' deductible if an insurance-related loss occurs after closing while the seller remains in the home.  For a buyer whose new home insurance policy has a $1,000 deductible a clause similar to the following would provide a remedy to this potential issue:

"Seller to be responsible for the first $1,000 of any insurance related loss if the loss occurs while the sellers continue to occupy the property after close."

This is a simple and reasonable solution.  Unexpected losses can - and do - happen: that's the purpose of insurance.  It's also reasonable to expect a seller, who requests time to remain in a home after closing, should bear some financial responsibility if any damages occur while they continue to occupy the home.

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