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Does retiring affect my car insurance? | Michigan Auto Insurance

posted Oct 2, 2018, 11:56 AM by Jason Grubbs   [ updated Oct 2, 2018, 12:26 PM ]

Retirement - Michigan Auto Insurance
If you've reached the milestone of retiring from the daily grind - congratulations!  There are a few items you should review and update on your Michigan auto insurance policy - changes likely to reduce your overall insurance costs.

Check the use of your vehicle

With most insurance companies the use of your vehicle is a factor in determining how much you pay for auto insurance.  Vehicles are customarily rated as pleasure use, commuting to-and-from work, or business use.  Pleasure use is typically the lowest cost rating classification, so check with your agent to make sure the use of your vehicle is updated to reflect your retirement.

Check your annual mileage

Just as the daily use of your vehicle affects insurance rates how many miles a year you put on a car can also impact how much you pay for auto insurance.  Many insurance companies offer low mileage discounts, so be sure to ask about availability and qualifications.

Check your Personal Injury Protection (PIP) coverage

Every Michigan auto insurance policy includes Personal Injury Protection (PIP) coverage comprised of two parts: Medical Coverage and Work Loss Benefits/Replacement Services, both of which provide benefits for individuals injured in an auto-related accident.

The medical portion of PIP coverage pays medical bills resulting from an auto accident and is either rated as primary coverage, meaning the auto policy pays for all auto-related medical bills, or secondary/excess, in which case the auto policy only responds after a separate health insurance policy that covers auto-related accidents.  If your retirement resulted in a change to your health insurance, such as switching from employer-provided medical insurance to Medicare, you should advise your agent of the change and may need to upgrade your auto policy to provide primary medical coverage.

Also, once you've retired you would no longer potentially benefit from or need work loss benefits if you were injured in an auto accident.  You may be eligible to waive this portion of the PIP coverage and thereby reduce your auto insurance costs.

Since the PIP portion of a Michigan auto insurance policy is coverage that affects every driver covered by an auto policy you may not be able to make certain changes, such as waiving work loss benefits, until the change would be applicable to every insured driver.

Michigan Auto Insurance Quote

Does Home Insurance Cover Food Spoiled Due To A Power Outage? | Michigan Home, Condo, Renters Insurance

posted Sep 20, 2018, 12:31 PM by Jason Grubbs   [ updated Sep 20, 2018, 12:32 PM ]

Refrigerator Contents - Michigan Home Insurance

Your Michigan home, condo, or renters insurance may provide coverage to reimburse you for the cost to replace food in your refrigerator or freezer that spoils due to a power outage.  Coverage is usually offered as an add-on (rider) available with these types of policies.

Your current policy may already include refrigerated contents coverage without you even realizing it as this coverage is frequently included within policy enhancements (endorsements) insurance companies offer that bundle together several popular, additional coverage options.

A typical refrigerated contents rider will feature:
  • A lower (or $0) deductible for covered losses
  • $500 or more of coverage per occurrence
  • Coverage for food spoilage resulting from a power outage (storm) & may even cover food spoilage if your refrigerator or freezer simply breaks down
Coverage limits, deductibles, and any conditions of coverage will vary between insurance companies so be sure to review the details of your policy or ask your agent for the specifics of your coverage.

Click here to read a related article How To Be A Smart Insurance Buyer providing useful insight on taking an active role asking questions and defining your concerns when purchasing or reviewing your insurance to be certain your policies will provide coverage that meets your needs and expectations in the event of a loss.

Are You Making Mistakes With Your Insurance? | Michigan Insurance

posted Aug 22, 2018, 1:43 PM by Jason Grubbs   [ updated Aug 22, 2018, 1:44 PM ]

Avoid Insurance Mistakes!
There are three categories of mistakes many people make when it comes to their insurance protection:

Not Purchasing Needed Insurance
The first mistake, with potentially the most devastating financial consequences, is not purchasing needed insurance.  This category of mistake often involves life and disability (income protection) insurance where otherwise prudent people adopt an "It won't happen to me" mentality and forgo purchasing valuable - and affordable - coverage to protect themselves and their loved ones in the event of a financial catastrophe.

What happens if you became sick or were injured and unable to keep working?
Disability Statistics - United Insurance Service
How long could you go without your paycheck?

What happens if you make a hasty exit from this life?
Overestimating Cost of Life Insurance
Would your spouse and family have the financial means - without your income - to buy groceries, pay the mortgage, and maintain their standard of living?

I've found many individuals also make the mistake of an "all or nothing" approach when it comes to not purchasing needed insurance.  Over the years I've witnessed numerous instances when a client asks about life insurance with a specific coverage amount in mind. When they find that amount doesn't fit within their budget they make the mistake of going without that insurance entirely.
If your family would need $500,000 of life insurance and all you can reasonably afford is a $250,000 policy, buy the $250,000 policy!  Your family would be far better off with $250,000 than to be left destitute if you make an untimely exit from this life.

Not Understanding What Insurance You Need and/or Purchased
While the first mistake is about neglecting to purchase needed insurance the second mistake is not taking time to understand what coverage you may need and/or what you have purchased.
Questions - United Insurance Service

While it is certainly understandable that insurance can sometimes seem complicated and confusing, most insurance agents are perfectly willing to review policies, explain coverage options, and answer questions - whether at the time you request a quote, when you purchase a policy, or any time questions arise - to make certain you understand and are purchasing appropriate coverage.

Unfortunately, when a disaster strikes is when it's too late to question whether you have appropriate or adequate insurance protection.  If you don't understand your coverage or wonder whether a certain type of damage is covered ask your insurance agent.  Being an informed buyer requires having a clear understanding what insurance you may need and what your policy covers.

Believing All Insurance Is The Same
There are a lot of insurance companies selling the same types of insurance policies.  While many of those policies offer similar coverage benefits every insurance company is not going to provide you with the same service - particularly at the time of a loss.

While price is certainly an important consideration when you're shopping for insurance you should also take time to learn about the insurance agent and company.  Ask friends for recommendations, research on the internet - find out about their reputation for customer service, including who will assist you when you have a question or policy change and how claims are handled.

A local insurance agent can be an excellent resource to help you make informed coverage decisions and to assist you after purchasing a policy with coverage and billing questions, policy changes, and claims.

What Is Storage Insurance? | Michigan Auto, Motorcycle, Recreational Vehicle Insurance

posted Aug 16, 2018, 1:01 PM by Jason Grubbs   [ updated Aug 16, 2018, 1:20 PM ]

Storage Insurance - United Insurance Service
Many types of vehicles - including travel trailers, fifth wheels, motor homes, motorcycles, and even some cars - may only be used seasonally, typically between early spring and late summer.

In season those vehicles are typically fully insured both for any potential covered damages to the vehicles as well as liability protection, as needed, to protect the vehicle owner(s) and operator(s) in the event someone is injured or property is damaged while the vehicle is being operated.

In the offseason, when those vehicles are safely tucked away in storage, there isn't the same potential risk of damages - most owners are only concerned what would happen while there vehicle was in storage if there was a fire, someone stole the vehicle, or perhaps a tree or other object fell on the vehicle.

Many insurance companies provide an option for the owner of a seasonal use vehicle to remove all coverage except comprehensive, which is commonly referred to as "storage insurance".  Comprehensive is the coverage that responds for other than collision damages including fire, theft, vandalism, weather-related damages, and falling objects.

While storage insurance provides an opportunity for seasonal use vehicle owners to reduce their insurance costs during the offseason that option also carries with it added responsibility for those vehicle owners to update their insurance accordingly when their vehicle is both going into and coming out of storage.

If you seasonally store a vehicle and change to "storage insurance" it is advisable to leave a note - prominently displayed - either on the vehicle or with the keys stating "Call Insurance Agent" as a reminder to update your insurance when you're ready to pull your vehicle out of storage and put it back on the road.

Auto Insurance Reform - What's Not Changing, What Is Changing & What It Means To You | Michigan Car Insurance

posted Jul 18, 2018, 1:53 PM by Jason Grubbs   [ updated Jul 19, 2018, 7:23 AM ]

Michigan Auto Insurance Reform
In recent years there have been several legislative attempts, each of which ultimately failed, to reform Michigan auto insurance.

The proposed reforms always gained traction in the news as the intention of each proposal was to reduce auto insurance costs, which Michigan motorists would welcome.

Why is Michigan auto insurance so expensive?

In Michigan, by state mandate, auto insurance policies provide unlimited, lifetime medical benefits if you are injured in an auto accident.  These benefits are provided within your auto policy through the Personal Injury Protection (PIP) coverage and Michigan Catastrophic Claims Association (MCCA) assessments.

The reason there are two separate portions of a Michigan auto insurance policy relating to medical benefits is because there is a certain dollar amount for medical benefits - currently $555,000 - your insurance company is responsible to pay out of their own coffers.  If a claim exceeds that amount your insurance company would still pay the entire claim, but they would be reimbursed by the MCCA for medical costs over $555,000.

What were the proposed reforms?

The proposed reforms sought to address medical costs, a significant factor in Michigan auto insurance rates, primarily by introducing optional levels of coverage.  Rather than simply being required to be insured for unlimited, lifetime medical coverage you would have the option to choose different levels of medical coverage.

Whether you supported or opposed the proposed changes one thing is certain: If changes to optional medical coverage limits were enacted more responsibility would have shifted to consumers to understand the options and make informed decisions when selecting their desired level of coverage.

It's all too easy for insurance buyers to narrowly focus on how much their auto policy will cost and how much they would pay if their car was damaged (comprehensive & collision deductibles), overlooking considerations such as what their policy would pay if they were injured in an auto accident.

None of the reforms passed, so why does this matter?

While the proposed reforms didn't pass we are beginning to see insurance companies take steps to provide a level of choice - and potential premium savings - on the front end for medical coverage with deductible options.  Historically, deductibles for the medical portion (PIP) of Michigan auto insurance policies have ranged from $0 to $500.

One of the companies our agency represents, Safeco Insurance, recently introduced a wider array of deductible options for Personal Injury Protection (PIP) coverage ranging up to $2,500.  Since the deductible is the portion of any covered loss you are responsible to pay out-of-pocket before insurance pays obviously - all other things being equal - the premium for medical coverage with a $2,500 deductible would be less than the same coverage with a $0 deductible.

While the premium savings may be welcome, insurance buyers need to be aware of potential out-of-pocket expenses they may incur in the event of a claim, particularly if they have coordination of benefits.

What is coordination of benefits?

If you have separate health insurance that will pay first - for all household members - for injuries sustained in an auto accident you may be eligible to select coordinated PIP coverage on your Michigan auto insurance policy.  Coordinated (or excess) PIP coverage - which costs less than Primary (or full) PIP coverage simply means your health insurance would pay first any medical expenses resulting from an auto accident and your auto policy would pick up any remaining medical expenses.

It's worth noting most auto insurance policies also include a penalty deductible - in addition to any selected PIP deductible - if the medical coverage is set up incorrectly.

If you purchased an auto insurance policy with a $2,500 PIP deductible that includes a $500 penalty deductible and were injured in an auto accident only to then discover your health insurance doesn't cover injuries from an auto accident you could wind up with $3,000 in out-of-pocket medical expenses - in addition to any other out-of-pocket expenses for damages to your car.

What does this mean to me?

It's important to first confirm whether your health insurer would provide primary coverage for auto-related injuries.  You should repeat this process any time your health insurance changes - whether your employer is changing health plans, you change jobs, or you retire.

(Tip: If you don't know whether your health insurer pays first for auto-related injuries call the number on your health plan ID card and ask "Does my plan pay first in the event of a motor vehicle accident?" or "Are there any exclusions in my plan in the event of an accident?").

With this information you will know what type of medical coverage (primary or excess PIP) to include in your Michigan auto insurance policy and then can make an informed choice selecting a PIP deductible - if offered by the insurance company - considering both what you will have to pay now (premium) and what you may have to pay out-of-pocket in the event of a claim. 

Is Your Home Underinsured? | Michigan Home Insurance

posted Jun 15, 2018, 12:21 PM by Jason Grubbs

Did you know?
According to this CBS News report nearly 60% of homes are underinsured.

Underinsurance - Michigan Home Insurance
What does underinsurance mean?

Within every home insurance policy there are coverage limits reflecting the maximum amount the insurance company will pay - whether for the dwelling, other structures on the premises, or personal property.

Coverage limits may be found on a home insurance policy declarations page - the front page of the policy specifying the time period of coverage, who is covered, what is covered, coverage limits, and premiums.

This article focuses on dwelling coverage - the amount the insurance company would pay to rebuild your home and any attached structures.

The limit of dwelling coverage on your home insurance policy should correspond to the actual cost to rebuild your home using the same type and quality of construction materials.  Underinsurance would be a situation where the amount of dwelling coverage is less than it would actually cost to rebuild your home.

How does underinsurance happen?

When you initially purchase a home insurance policy your insurance agent should assist in calculating the cost to rebuild your home and, whenever possible, provide a policy insuring your house for this amount.

The replacement cost of any home will likely be different than the purchase price or market value, which reflects market factors including the age, condition, location, and overall desirability - to a buyer - of the home.  A capable insurance agent will calculate the cost to rebuild your home using information you provide about the square footage, features, and construction materials and may also review listing information, county records, and complete an on-site inspection.

After you purchase a home insurance policy the insurance company will typically increase the dwelling coverage each year based on regional increases in construction costs.  While these annual increases are intended to keep pace with building costs over time the results can vary resulting in your home potentially being underinsured (or even over-insured).  For this reason it's a good idea to review the cost to rebuild your home and your insurance coverage at least once every 3 years.

The more common way underinsurance situations happen is when homeowners make additions or improvements to their home and neglect to inform their insurance company.  It's a good idea anytime you're undertaking a sizeable renovation - whether upgrading a kitchen, finishing a basement, or adding other living space - to call your insurance agent.

How do I confirm how much it would cost to rebuild my home?

If you want to get a good idea of the cost to rebuild your home the Building-Cost.net website offers a free, online calculator that doesn't require providing an email or any other contact information, is easy to use, and takes less than 10 minutes to complete.  I tested the calculator with my own home and the results were within 1% of the valuation I calculated using advanced industry  replacement cost software programs.

Your insurance agent should also be able to review and update their replacement cost calculation then furnish you with a copy of their estimate.  You should review any replacement cost estimate to confirm the square footage and features are accurate, especially as some software programs make assumptions about features based on the age, style, and size of a home.

Why is properly insuring your home important?

It's important to make sure your home is properly insured so that, in the event of a total loss, you have adequate funds to rebuild your home using the same type and quality construction materials.  It would be quite distressing to discover, after suffering a catastrophic loss to your home, that your insurance coverage isn't enough to pay the full cost to rebuild!

Furthermore, within the terms and conditions of most home insurance policies there is usually a provision that penalizes you if, at the time of a loss, the amount of insurance is found to be less than 80% of the replacement cost.

Is there anything else I can do to make sure my home doesn't wind up being underinsured?

Yes! When you purchase a home insurance policy you may also be eligible to add Guaranteed Replacement Coverage to your policy.  This optional rider alleviates worry whether your home insurance is keeping pace with construction costs by transferring that burden to the insurance company.

With Guaranteed Replacement Coverage the insurance company agrees, providing the home is initially insured at 100% of the replacement cost, to pay the entire cost to rebuild - even if that cost exceeds the stated limit of coverage.  There is still a maximum payout, typically an additional 25% - 50%, above the stated dwelling coverage.  There is also customarily a provision requiring you notify the insurance company of any changes that increase the replacement cost of your home by more than 5%.

Even with those stipulations Guaranteed Replacement Coverage is a worthwhile option to significantly reduce the possibility of your home being underinsured.

Summer Toys & Insurance | Michigan Auto, Motorcycle, Recreational Vehicle Insurance

posted Jun 8, 2018, 1:14 PM by Jason Grubbs   [ updated Jun 8, 2018, 1:16 PM ]

Summer Toys - Michigan Insurance

With the arrival of the summer season it's an opportune time for a reminder:

If you're pulling toys out of storage for the season make sure they're properly insured

Many insurance companies offer storage options for vehicles that are only used seasonally - whether a summertime cruising vehicle, motorcycle, travel trailer, fifth wheel, or other recreational vehicle.

While a storage option (comprehensive only covering losses that may occur to an item in storage such as fire or theft) provides a way to reduce insurance costs during the offseason it also places a responsibility on you to notify your insurance agent or company to add appropriate coverage for those items to be back on the road when you're ready to take them out of storage.

This is such an easy thing to overlook we recommend placing a sticker on items in storage or with the keys that says:
"Call insurance agent before using!"

Do I need insurance for my boat? | Michigan Boat & Watercraft Insurance

posted May 22, 2018, 1:39 PM by Jason Grubbs   [ updated May 22, 2018, 1:41 PM ]

Grand Rapids Boat & Watercraft Insurance
With summer arriving soon many Michiganders are looking forward to enjoying warm days in and on the water.

Did you know? It's estimated between 35 - 50% of all boats are uninsured.  While the State of Michigan doesn't require you to have boat insurance that doesn't mean it's a good idea to go without this valuable coverage for your boat or personal watercraft.

A lot of people assume it's safe to go without insurance when they have an older boat or watercraft that may have a lower value. The decide insurance isn't worth the cost and bother based on the low value of their boat.
Boat insurance, it's important to note, protects a lot more than just the value of your boat.

What happens if you injure someone?
What if your boat sinks and you need to pay to have wreck removed?
What if you are responsible for a fuel spill?

A boat insurance policy will include liability protection in the event you are responsible for injuries, wreck removal or pollution.

Boat Wreck - Michigan Watercraft Insurance

MCCA Assessment increasing July 1, 2018 | Michigan Auto Insurance

posted Apr 17, 2018, 1:11 PM by Jason Grubbs   [ updated Apr 17, 2018, 2:15 PM ]

Michigan Catastrophic Claims Association (MCCA)
announced the MCCA assessment for every insured vehicle in Michigan will be
$192.00 per vehicle effective July 1, 2018 to June 30, 2019.

This represents an increase of $22.00 compared to the 2017-2018 assessment, a 13% increase.

In the State of Michigan, by state requirement, auto insurance provides unlimited coverage for medical expenses resulting from an auto accident.

In order to fund this level of coverage in 1978 the state legislature created the Michigan Catastrophic Claims Association to provide funding for catastrophic claims.

If you suffer an auto-related injury your auto insurance company would be responsible for the first $555,000 of medical expenses covered by your policy.  Once medical expenses for a covered auto claim exceed that threshold amount your insurance company would continue to handle administration of the claim, but any dollars spent for medical benefits in excess of $555,000 would be reimbursed by the MCCA.

The increased MCCA assessment will be reflected on auto policies renewing on or after July 1, 2018.

Roadside Assistance - More than just Towing! | Michigan Auto Insurance

posted Mar 28, 2018, 12:18 PM by Jason Grubbs   [ updated Apr 3, 2018, 11:25 AM ]

Roadside Assistance - Michigan Auto Insurance

When I started in the insurance business, over 25 years ago, towing was an optional coverage on Michigan auto insurance policies that simply reimbursed you, up to a specified dollar amount, if your vehicle required the assistance of a tow truck.

Over the years most insurance companies have enhanced their towing coverage to become Roadside Assistance Programs extending benefits along with offering convenient options to arrange for services with the bill paid directly by the insurance company.

Roadside Assistance typically covers:
Dead Battery
Changing a Tire
Lock Out Service
Emergency Fuel & Fluid Delivery
Minor Mechanical Assistance

The way it works is simple: When you include roadside assistance coverage on your Michigan auto insurance policy the insurance company provides you with an emergency roadside assistance phone number or a Smartphone app to access services available 24 hours a day, 7 days a week.

If you ever need roadside assistance you call or use the app and a representative will assist you dispatching a local service provider.  Once service has been completed you simply sign and the bill is taken care of directly by the insurance company - saving you the time and hassle of arranging service directly, paying out of pocket, and waiting to be reimbursed.

If you happen to arrange service on your own you can still submit a receipt for reimbursement of any covered expenses.

Emergency Roadside Assistance Phone Numbers

Fremont Insurance: 1-800-550-0325

Hagerty Insurance: 1-888-445-8103

Progressive Insurance: 1-800-776-2778

Safeco Insurance: 1-877-762-3101

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