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Gaps in Your Policy Coverage Can Leave You Exposed

 

You may have auto insurance and home or renter's insurance in place to make sure you are covered in case of an accident.

But, depending on the circumstances of a claim, you may have coverage gaps in your insurance.

You should review your policies to see if you have any of the following gaps in your coverage:

Coverage for your valuables

This would include:

  • Any collections (coins, stamps, art, etc.),
  • Pricey jewelry or watches,
  • Electronics. 
  • Umbrella policy

Regardless of whether or not you're at fault for an accident, you can still get hit with a personal injury or liability lawsuit. And when that happens, you can expect extra costs to mount quickly, what with lawyers' fees, hospital bills, pain and suffering payments.

All of that combined could quickly exceed your homeowner's or auto policy limit, and then your assets would be at stake.

Transportation expenses coverage

Does your policy cover a rental car or other form of transportation if your vehicle ends up in the shop after an accident?

Flood insurance

The federal government offers coverage through the National Flood Insurance Program. It's definitely worth considering, as people who live outside of high-risk flood areas file more than 20% of claims with the program.

Not keeping your homeowner's insurance up to date

If you've made upgrades to your home, tell us about it before your next policy renewal. If you don't, you run the risk of coming up short if you have to rebuild after a total loss. Report remodeling or renovations, so we can help determine the effect on your home's replacement cost.

As you can see, there is plenty that's easy to overlook when it comes to your insurance and protecting yourself and your assets. If you're concerned about any of these issues, call us today.

'Dude, Can I Borrow Your Car?' Is Your Friend Covered?

One Saturday afternoon your friend calls you up and asks: "Dude, can I borrow your car for a few hours today? Mine's in the shop." You don't think much about it and hand over your keys.

But what do you do if your friend has an accident? Whose insurance pays for it?

Though policies vary, the general rule is that anyone living in your house is typically covered when driving your car, unless expressly excluded on the policy.

For those friends or family members who don't live with you but use your car every once in a while, you can typically loan them your vehicle and not worry that they'll be covered.

Permissive use generally applies in these cases. This means that if you give another driver permission to take your car, they will be covered by your car's insurance coverage.

However, it's not that simple if your friend causes damage that exceeds your policy limits.

In general, the vehicle owner's policy is primary and pays first in the event of a loss. If your owner's policy does not cover the loss or provide enough insurance to fully cover it, the borrower's policy will apply.

Deductible

Your insurance will also be primary for damage to the car itself. However, the borrower's insurance can make up for a difference in deductible.

Reasonable belief

One very important part of all this is that anyone who borrows your car must have your permission in order for the insurance to cover them. The key here is that the insurance company will cover your friend using your car if your friend had a "reasonable belief that he could use the car."

Permission must come from the vehicle's owner, not from a member of the owner's family. Steve will not have coverage if your son gave him permission to use it.

Before borrowing someone else's car, we advise people to do the following:

  • Make certain you have the owner's permission.
  • Make certain the owner has insurance.
  • Check your own insurance to see if it will cover damages the owner's policy doesn't cover.

Based on this blog post, if you think you might have a gap in your car insurance coverage, let me know, and I’ll work with you to make sure you’re not caught exposed.

 
Frances Zettl