Frequently Asked Questions 

Auto Insurance Questions

What is Bodily Injury Liability?

If you or someone else who is covered on your policy is legally responsible for causing injury to the occupants of another car or a pedestrian, the Bodily Injury Liability coverage part of your policy will pay for their medical bills, lost wages, expenses, pain and suffering, etc. up to the limits you purchased.

What does Property Damage Liability cover?

If you or someone else who is covered on your policy has an at fault accident which causes damage to another's property, the Property Damage Liability coverage part of your policy will pay the damages up to the limit you purchased. The most common losses are damage to other vehicles and objects such as fences and traffic signs.

Does the Single Limit of $300,000 provide more coverage than Split Limits of $100,000/$300,000?

Yes, because there are no restrictions on the number of persons that can be paid with Combined Single Limit as there is in Split Limits.

Is one type of coverage less expensive than the other?

It depends on the amounts of coverage you select and the deductible. Generally, Split Limits  coverage is less expensive than Combined Single Limit, assuming that all other things are equal.

Do the Split Limits of 100,000 per person/300,000 per occurrence for bodily injury and /$100,000 for property damage provide less coverage than a single limit policy of $300,000?

In many instances, Split Limits coverage provides less because the per person limit for Bodily Injury and the per accident limit for Property Damage is less than the total coverage provided for in a Combined Single Limit policy. With Bodily Injury coverage of 100,000 per person/300,000 per accident and Property Damage coverage of 100,000, the maximum amount the policy would pay to any one injured person is $100,000. The equivalent Combined Single Limit policy is 300,000, and this policy would pay up to the 300,000 limit without any restrictions per person.


Does Uninsured Motorist Coverage provide insurance when I'm in an accident with a driver who does not have insurance?

Uninsured Motorist coverage for Bodily Injury covers you for injuries that you and your passengers sustain as a result of an uninsured driver. It also provides coverage for hit and run accidents where you are the victim.

Uninsured Motorist coverage for Property Damage covers you for damage to your vehicle as a result of a negligent, uninsured driver. Most states have different limits for this coverage. 

This coverage is applicable only if the other driver is at fault. You'll need written proof that the driver is uninsured. This could be a letter from the other party stating that they are uninsured, or a police report which states that the other party is uninsured and at fault.


Doesn't the law require liability insurance for all drivers?

Yes, but unfortunately, there are many uninsured drivers on the roads.

How much Uninsured Motorist coverage should I have?

Many experts recommend you have as much Uninsured Motorist coverage as your regular liability Bodily Injury and Property Damage coverage. If you do not want that much coverage, you may want to check your state's minimums for this coverage. In some states, you can waive this coverage if you have collision coverage. However, you cannot have more Uninsured Motorist coverage than your liability coverage.

What is Underinsured Motorist Coverage?

Some states require you to have Underinsured Motorist coverage in case of an accident with a motorist who does not have enough liability coverage to pay for injuries or damage done in an accident for which he or she was legally responsible. The required minimum state limits for this coverage are generally the same as Uninsured Motorist coverage.

What is collision coverage?

Collision covers repair or replacement of your vehicle for any direct and accidental loss resulting from an upset, or colliding with another object, except an animal (which would be handled under your comprehensive coverage). Collision pays for the repair or replacement of your car at its current market value, less your deductible. Many experts recommend skipping collision coverage if your car's resale value is less than $3,000. However, you should only skip collision if you can afford to replace your car should it become totaled in an accident.

You will need collision if you are leasing or buying a car and have a lien holder (i.e., bank, finance company, etc.). In addition, you can purchase collision without having comprehensive coverage, but most insurance companies will not let you purchase comprehensive (which covers loss from theft, fire, vandalism, etc.) without collision.

What is comprehensive coverage?

Comprehensive provides coverage for damage done to your vehicle in any situation other than an accident. For example, theft, vandalism, fire and colliding with an animal would be covered under comprehensive. A number of experts recommend you pick the highest deductible you can afford, as this will give you the best premium savings.

You will need comprehensive coverage if you are leasing or buying your car and there is a lien holder (i.e., bank, finance company, etc.). Since the cost of comprehensive coverage accounts for a large portion of your premium, many experts suggest you think about dropping comprehensive coverage if your vehicle is worth less than $3,000. However, if you drop your comprehensive coverage and your car is stolen, vandalized or catches fire, you will need to repair or replace it yourself.

What is liability coverage?

Liability coverage is one of the most important parts of your automobile insurance coverage. It protects you from claims that arise out of an accident in which another party was injured or property was damaged. In most states, liability coverage is compulsory. There are two ways it can be purchased: either in the Combined Single Limit form, or the Split Limits form.

What does Medical Payment cover?

This coverage pays for medical expenses that you, your family members or guests in your vehicle incur as a result of injuries caused by an automobile accident. Medical Payment coverage pays for a doctor's care, hospitalization, pharmacy bills, ambulance service and funeral expenses, no matter who is legally responsible for the accident. In addition, Medical Payment coverage will generally pay your deductible or co-payments due under your health insurance. If someone in another car or a pedestrian is hit by you or someone covered by your policy, your Bodily Injury liability coverage would pay for their medical expenses if it was determined that you were legally responsible.

What is the difference between Bodily Injury coverage and Medical Payments?

Basically, Bodily Injury liability coverage pays for the medical expenses of pedestrians and occupants of another vehicle if you are legally responsible for causing the accident. It would also pay other expenses such as lost income, pain and suffering. Medical Payments coverage reimburses you and any passengers in your vehicle for medical expenses that are incurred as a result of an accident, no matter who is considered legally responsible for the accident.

Do I get Medical Payments if I am injured while driving someone else's car?

Yes. However, the injuries of any passengers would not be covered. That would be up to the medical payment portion of the car owner's policy.

What if I already have health insurance? Should I still get Medical Payment coverage?

Yes. While your health insurance might cover you, anyone else injured in an accident in which you were involved wouldn't be covered by your health insurance (unless they were listed as dependent coverage) and you would need Medical Payment coverage to cover their medical expenses.

What is single limit insurance?

Combined Single Limit is the combination of Bodily Injury and Property Damage coverage. The limit is expressed a single sum. This is the total amount of Bodily Injury and Property Damage liability coverage that the insurance company is obligated to pay on your behalf if you are liable for an automobile accident. A policy with a $300,000 Combined Single Limit means that the maximum amount for both Bodily Injury and Property Damage that can be paid is $300,000.

What does it mean when I see insurance coverage such as 100/300/100?

This is known as Split Limits coverage. The first two numbers are for Bodily Injury coverage. The first number is the maximum amount of coverage the insurance company is obligated to pay on your behalf to any one person who was injured as a result of an automobile accident. The second number is the maximum amount of coverage that the insurance company is obligated to pay on your behalf to all persons who were injured as a result of an automobile accident. The third number shows you the total amount of property damage that the insurance company will pay on your behalf as a result of an automobile accident.

Home Insurance Questions

I live in a rented house / apartment. Shouldn't I be covered by my landlord's insurance?

No. That's a popular misconception. Many people think that if something happens to their apartments, the landlord's insurance will cover them. Unfortunately it doesn't work that way. The landlord's insurance will only cover the damage to the landlord's property - the building. If someone breaks in and steals your television, you will not be reimbursed by your landlord's insurance for replacing the television. Your landlord's insurance will, however, pay to repair damages to windows or doors caused during the break-in.

I work out of my home. Is my business covered under my homeowners insurance?

Most homeowners insurance policies cover business equipment and furniture in your home up to a certain maximum. Be sure to check your policy to see what your maximum is. Some policies only cover you up to $2,500 on premises and $250 off premises, and you may need an endorsement to cover your business equipment. Others offer a higher maximum on equipment, furniture and information stored on your personal computer, but they may require that the business be "incidental," meaning that it is not your primary source of income. Always read your policy.

Does my homeowner's insurance cover damages to my garage even though it is not attached to our house?

Yes. Homeowner's insurance includes coverage for "other structures." In other words, any structure on your property that's not attached to your house (such as your garage) is usually covered for about 10 percent of the amount of coverage on your home. However, your vehicle parked inside that garage is covered under your auto insurance, not your homeowners policy.

Aren't "acts of God" and "natural disasters" the same thing?

Pretty much, and if you have an HO3 policy, your homeowners insurance covers just about all of them with two notable exceptions - earthquakes and floods (water damage) - as well as two very unnerving exceptions - war and nuclear hazard. You need to get specific earthquake and/or flood insurance in addition to your regular homeowners coverage if you are at risk from any of these perils.

We keep our boat parked in our driveway. Is it covered by our homeowners insurance?

That depends on your homeowners insurance policy and the boat itself. Some homeowners policies cover motorboats and small sailboats, but not larger boats stored on the premises. For larger boats, you need separate watercraft insurance.

My kids were playing baseball in the yard and broke the windshield on my neighbor's car. Will my homeowners policy pay to replace it?

Yes. Your homeowners policy will cover replacing the windshield under your homeowners liability coverage.

What if something happens to our house and we have to move out while it's being fixed. Will my insurance pay for this?

Under most homeowners insurance policies, you are covered for "loss of use" due to a covered peril, not because you decided to repaint the living room. However, the coverage is for costs you incur above and beyond your normal living costs. For example, reasonable hotel room costs would be covered an expensive suite will not.

Does my homeowners insurance cover everything inside my house?

Not everything, but quite a lot of it. 

Homeowner's insurance is designed to protect your property from loss or damage by situations outside your control - weather conditions, burglars, falling objects, etc. Things such as wear and tear aren't covered, nor are losses resulting from negligence or fraud, or from damage done by family members living in your household (spouse, children, parents, etc.). In addition, certain items of personal property (jewelry, coin, gun and stamp collections, silverware, cash, bonds, etc.) have very specific coverage limits unless you add an endorsement to increase your coverage for these items.

Home businesses are another area where coverage is specific and limited. Please call us for any specific questions you have about your policy. 

Life Insurance Questions

What is life insurance?

Life insurance is a way to provide benefits for your survivors or beneficiaries if you die. The death benefit in a life insurance policy is purchased to cover final expenses (such as burial, medical costs, etc.), pay any outstanding debts you might leave (such as a mortgage), and provide income and financial security for your dependents.

What is term life insurance?

Basically, a term life policy provides death benefit coverage for a limited period of time or term. However, it can provide coverage to an advanced age, such as 90, as long as the premiums continue to be paid. Term premiums are usually level for 1 to 30 years, depending on the policy you select, and then will generally increase each year thereafter.

Benefits of Term Insurance

The initial premiums for term life insurance are usually significantly lower than permanent life insurance (cash value insurance). However, term premiums increase. They will increase at the end of any level term period, and they will significantly increase as you get older. Many term policies include a conversion feature that lets you convert your term policy into a permanent life insurance policy without providing evidence of insurability (medical evidence and history). You can buy term insurance for a limited time and then, when you're ready to accumulate tax-deferred cash value for the future or for a loan, purchase permanent or cash value life insurance (no matter what your current health).


What is whole life insurance?

Whole life is an insurance policy where the premiums are usually fixed, level and payable each year. Whole life is a type of permanent insurance, which means, as long as the premiums are paid each year, you are covered until death occurs.

Benefits of Whole Life Insurance

As you know, the risk of death increases with age. Since the whole life premiums remain level, they are more than adequate to cover the cost of the death benefits when you are young. Therefore, in these early years, you will have excess premium amounts (premium less mortality charges) that will accumulate in a tax-deferred environment. This amount is the guaranteed cash value. If you own the policy, while whoever is insured is alive, you can borrow against the available cash value (i.e., the amount less any already outstanding policy loans), or you can receive the cash value, less any outstanding policy loans, if you surrender the policy.

If the person who is insured should die while the policy is in force, the face amount of the policy will be paid as a death benefit, less any outstanding loans.


What is interest sensitive whole life?

Interest sensitive whole life is a whole life policy where the premiums are fixed. When premiums are paid, they are placed in an account value. The size of the account value will be determined by the interest earned on the account value, and the expense and mortality charges deducted. The interest earned is based on the interest rate declared by the insurance company. The interest rate may change periodically but the declared rate cannot be less than the minimum interest rate specified in the policy, typically 3% to 4%. The amount of expense and mortality charges may be changed from time to time by the insurance company. However, these deductions cannot be larger than the maximum charges specified in the policy.

What is universal life insurance?

Universal life insurance offers a great deal of flexibility. Premiums can be varied from time to time by the policyowner (not by the person being insured) within certain limits set forth in the policy. The size of the account value at any time will be determined by the actual premiums paid, the interest earned on the account value, and the expense and mortality charges deducted. The interest earned is based on the interest rate declared by the insurance company. The interest rate may change periodically but the declared rate cannot be less than the minimum interest rate specified in the policy, typically 3% to 4%. The amount of expense and mortality charges may be changed from time to time by the insurance company. However, these deductions cannot be larger than the maximum charges specified in the policy. A universal life policy may provide permanent or term life insurance coverage depending on the level and number of premiums paid in addition to the interest earned, and expense and mortality charges deducted.