FAQ

AUTO INSURANCE

Why do I need to buy insurance?

• Protects your assets against attachment as a result of a court award.
• Provides for cost of defense when you are sued.
• Allows you to purchase such high value items as a car or a home by insuring the collateral on behalf of the financial institution that lent you the money.
• Provides financial security for your family in the event of your death.
• Provides for the health care of you and your family through systematic payments.
• Allows you to save for retirement while deferring interest payments to a time when your income is lower, thus reducing your tax payments.
• Allows you to remain financially solvent when you're ill and can't work.

What factors affect the insurance premiums I pay?

• Claims activity including such costs as medical care, auto body repair, construction, legal defense, jury awards, claims adjustment, and insurance fraud.
• Overhead including rent, utilities, employee salaries and benefits, office supplies, equipment, and furniture.
• Investment income.

What happens when I loan my car to someone? Is that person covered by my policy? Am I still covered?

Yes. Liability and coverage for physical damage (i.e. comprehensive and collision) always follow your car if permission to use the vehicle was given. Plus, if the driver of your car is insured, his/her policy will also be available to cover the cost of damages and injuries.

BUSINESS INSURANCE

I'm just getting my business started. Do I need insurance immediately?

Yes. Your chance of suffering a loss begins with the first day of business. If you suffer a loss and have no insurance or have improper or insufficient coverage, your insurance agent can do little, if anything, to help you.

Also, many states and local jurisdictions require businesses to have insurance to begin operating. And if you rent space for your business, your landlord probably requires you to obtain adequate insurance.

I don't have any major business assets. Why do I need insurance?

Every business has some property. When you think about it, your business is your property. Just like your home and your car, your business needs to be protected from loss, damage, and liability. In addition, your business is your source of income, so you need protection from the potential loss of that income.

HEALTH INSURANCE

What is the basic difference between individual and group health insurance coverages?

An individual policy is purchased by you directly with the insurance company.

With a group health insurance policy, the group is the master insured and the insurance company contracts with the group. Insurance certificates, issued to a participating member, act as your policy. Often group health insurance costs less than would have been charged had the insurance company sold individual policies to each member separately. In addition, group health insurance often contains special coverages that are not available or are very expensive on an individual basis. The purchasing power of the group makes this economically feasible.

Does my employer have to provide health care coverage?

No. But if so, certain state and federal regulations may apply as well as certain requirements, such as full-time status, may be imposed.

My employer does not offer health insurance to its employees. What kinds of individual personal policies are out there?

If you are unable to obtain health insurance through employment or as a member of an association, you should consider the purchase of individual health insurance. Although such coverage is typically more expensive than health insurance provided under a group plan, it is important for people to maintain good health insurance coverage since an accident, disease or illness could result in financial ruin.