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Insurers Battle Damage Costs from Storms that Killed 45 People

A number of insurance companies are struggling to keep up with claims responding to damage produced by severe storms and tornadoes that struck much of the U.S. in the past week. Several major insurers have racked up more than 12,000 claims and are expected to see more in the coming days and weeks.

State Farm and Nationwide Deal with High Number of Claims

State Farm Mutual Automobile Insurance Co., the largest provider of home and auto insurance, is dealing with claims that have been accumulating for both types of coverage in the wake of massive storms that ravaged much of the U.S. from Oklahoma to the East Coast and claimed the lives of 45 people.

State Farm estimates it has received 7,500 home insurance claims so far. Much of the structural damage, in North Carolina and Virginia in particular, has resulted in many homes most likely being declare uninhabitable. Sta

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How Does an Auto Insurance Claim Work?

Many individuals are unconcerned about how an automobile insurance claim works until they actually need to file one. The entire claim process can be affected by many different factors, such as the state laws where the claim is made, the insurance provider involved, and the extent of the injury and/or damage. Here is the basic outline of how the claim process works.

Notify the Agent

Do not delay the reporting of the accident to the agent, regardless of who appears to be at fault. The agent will advise on how to proceed with the claim and make recommendations on what the insured should and should not do regarding others involved. Documents will be required such as a police report and repair estimates. Generally more than one repair estimate is required, to get a balanced view of the damage.

Repair Authorization

Do not authorize vehicle repairs until the insurance agent has given instructions to do so.

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Glossary of Auto Insurance Terms – Part 1

For those who do not work in the auto insurance arena, it can be overwhelming to attempt to make heads or tails of the industry terms and policy jargon and what it all means. However, it isn’t that the terminology is overly complicated: it is just that people who are not involved in the business professionally might benefit from a primer on auto insurance terms in order to better understand insurance policies and quotes.

Liability Insurance

In the event of an accident, you may be held as legally accountable, or “liable,” for any property damages (PD) or bodily injuries (BI) that occur to the other party; these damages can be charged to your basic liability insurance. Liability insurance coverage is designed to protect the insured if any lawsuits are filed against them, and is not intended to provide reparations to the insured, but to the injured and not at-fault parties. If yo

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Wisconsin Bill Adjusts Mandated Auto Insurance Rules

The Senate and House of Representatives in Wisconsin have approved a bill that would adjust a previous mandate for auto insurance premiums in the state. The bill serves as a reversal to a law that raised premiums and insurance rates for some drivers.

Bill Lowers State’s Liability Coverage Requirements

In 2009, a law was signed that raised the limits on the minimum amount of coverage people had to have. Premium costs were increased, making it challenging for many low-income drivers to afford coverage.

In an effort to lower rates, the minimum liability insurance coverage amounts were lowered so that drivers in the state are now required to carry $50,000 of coverage for accidents causing bodily injury or death for a single victim, $50,000 for numerous victims and $10,000 for property damage alone.

The limits had been raised, effective June 2010, to $50,000, $100,000 and $15,000, respectively.

Wisconsin Drivers Will Still Have to Carry Insurance

While coverage limits will be lowered, one portion of the bill will not change. T

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Pedestrian-Detection Technology Could Save Millions of Dollars and Lives

A recent Status Report newsletter published by the Insurance Institute for Highway Safety that pedestrian-recognition technology could potentially avert thousands of vehicle crashes every year, saving lives and millions of dollars in repair costs and insurance premium increases. Developing and implementing this new kind of technology should be considered the next logical step toward greater public safety, similar to automated surveillance cameras at intersections, according to the IIHS report.

There have already been major advances in pedestrian-recognition technology by several car manufacturing companies; Volvo has integrated it into their new S60 sedan. According to Volvo’s website, “The Collision Warning with Full Auto Brake and Pedestrian Detection system fitted in the 2011 model S60 was first announced early last year. It uses a computer fed by information from a wide-angle radar system that detects objects and monitors their speed and distance from the car, and from a camera fitted near the rear view mirror. Usi

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California PIP Insurance Fraud Ring Busted

The number of people implicated in California car insurance fraud cases went up by eight people last week, according to California Insurance Commissioner Steve Poizner. The individuals who are being charged with this crime are individuals who allegedly staged car accidents and claimed to be party to those accidents in order to make personal injury insurance claims against auto insurers.

In this particular fraud ring, the implicated individuals received more than $200,000 in payments from various companies. The California fraud tax force cracked down this past October after it had been discovered that ten suspects who had been charged with operational hit-and-run from other investigations which had been going on for the past calendar year.

The supposed ringleader of the operation, a 31 year old individual from Chula Vista named Jay Stoney, did not plead guilty when the charges were brought against him on November 2nd.

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Progressive Takes Pay-as-You-Drive Program Nationwide

Progressive Insurance recently announced that it is now offering its Snapshot program to all states. The pay-as-you-drive (PAYD) program had been implemented in a few dozen states, most recently Florida, but now is available for all customers.

How Do Pay-as-You-Drive Programs Work?

If you’re not familiar with the Snapshot program, it is a pay-as-drive-option that judges your driving behaviors to determine how much you should be charged for your auto insurance. For Progressive’s program, drivers are asked to install a tracking device called an on-board diagnostic (OBD) port that records and sends driving data to the company.

After driving the car for 30 days with the device intact, the company is able to determine your driving habits. At

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Protect from Litigation: Balloon Policies for Auto Coverage

In another example of how lawsuit-happy that society has become, experts now recommend that it would be wise for individuals to increase their auto coverage to indemnity limits similar to, if not higher than, home insurance indemnity.

A normal homeowner’s policy has approximately $100,000 up to $300,000 in liability coverage. Conversely, the industry norm for car insurance policies has been around $100,000 per person injury coverage, $300,000 per accident in bodily injury, and about $50,000 in property damage coverage per incident.

These allowances might not be enough, though, even for the average person. According to Madelyn Flannagan, who vice president of agent development, research and education with the IIABA (Independent Insurance Agents and Brokers of America), “People today have become so litigious they’re suing for everything,” says Ms. Flannagan. “You’re

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