REPOST: Dent your car? Insurance cost may soar if you file even a small claim

Filing claims for minor car dents may increase auto insurance premiums. A new study reveals that American drivers pay an average of 38 percent more for car insurance after making a single claim. Read the full report from Detroit Free Press.

Did you ever dent your car skidding over a curb during a snowfall and choose to pay for the damage out of pocket rather than risk increasing your auto insurance premium?

Family members hug in the aftermath of a big accident on I-75 on Jan. 31.
Filing claims for minor dents probably will increase auto insurance premiums.
Mandi Wright/Detroit Free Press
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What about accepting the dented bumper because you don’t want to overheat your credit card, in addition to wanting to keep your insurance rates down?

If that sounds like you, well, maybe you’ve done the right thing after all.

A new study shows that drivers nationwide pay an average of 38% more for car insurance after making just a single claim. Michigan showed an average increase of nearly 23%, the third lowest increase in the country, according to the report by InsuranceQuotes.com.

The steepest hike would be in Massachusetts, where one claim can lead to an average premium increase of 67%. California was up an average 62%; and New Jersey was up an average 59% after one claim, according to the study.

The study noted that the average annual premium in Michigan, based on data from the National Association of Insurance Commissioners, is $935. But after making one claim of $2,000 or more, the study showed that the average premium would be $1,147, up 22.7%. 

Laura Adams, a senior analyst for InsuranceQuotes.com, based near San Francisco, said consumers should not file small claims on their auto insurance, in general, unless absolutely necessary.

How much a premium could go up, she said, would vary significantly from policy to policy. And she noted that extra cost could hit policies for not just for one year, but maybe for three years to five years down the road, as well.

No surprise, perhaps, but making a second claim within a 12-month period will ding your finances even more. A driver with two claims pays nearly twice as much for car insurance as a claim-free driver, according to the study.

Some consumers could have even more reason to avoid filing a claim — if a car owner already made a claim recently, or maybe fears that a teen driver on the policy could cause more damage to a car in a few months.

Lori Conarton, a spokeswoman for the Lansing-based trade group the Insurance Institute of Michigan, said insurance is complicated so the disparity in the impact of claims by state varies due to regulations, and the nature and severity of the claim.

“Michigan’s high mandated auto insurance benefits cause Michigan’s auto insurance premiums to be costly, so it is good news that the impact of claims in Michigan is lower than other states,” Conarton said.

She said insurance premiums can increase after a loss because filing one claim makes a consumer more likely to file another one in the future. As a result, a consumer is viewed as a more risky and expensive customer to insure.

So what do you do in the winter?

“If people jump a curb due to winter weather and damage their vehicle, they first need to calculate how much it will cost to have the car repaired and take into consideration the amount of their deductible,” Conarton said.

If you have a $500 deductible and you have $550 in repairs, it’s very likely not worth it.

“It is really a math calculation to determine whether they should file the claim or pay the damage themselves,” she said.

Freeway Insurance is one of the fastest-growing insurance distribution companies that offers a wide range of auto insurance options nationwide. Follow this Twitter account for the latest news and updates on the insurance industry.

New Toyota campaign geared toward teenage drivers

Toyota Motor Corp. recently announced the launching of its newest campaign, “TeenDrive365.” The campaign, which is Toyota’s biggest one to date, tackles the pressing issue of teenagers’ driving safety. Recent statistics show that vehicular accidents are among the leading causes of death among teenagers, mostly due to distractions such as phone calls or text messages.

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In line with the campaign, Toyota will be putting in efforts in print, radio, display, and online advertising. It will also be running new video spots on Hulu.com and ABC.com, videos which will focus on a teenage driver’s first year behind the wheel, arguably also the most dangerous year for him/her. Everything will be tied together at the campaign’s website, teendrive365.com.

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The goal of the campaign is to get parents to discuss with their teenage children the “dangers of distracted driving,” according to Marjorie Schussel, corporate marketing director for Toyota. This, they hope, will help to set a safe driving example for youngsters, which will influence them for the rest of their lives.

"The campaign is based on the insight that the first year of driving is one of the most dangerous years of a teen's life," Schussel said. She said the issue is personally relevant, due to her 16-year-old son just recently getting his driver's permit. "I don't know a parent who isn't concerned about the safety of our kids on the road today."

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More teens die in car crashes than from homicides and suicides combined, according to the National Safety Council. It also found that people using handheld devices are four times as likely to crash compared to drivers using hands-free devices.

Freeway Insurance Services is the largest privately held automobile insurance broker in the US. Visit freewayinsurance.com for more news on automobiles and automobile safety.

Ideal insurance coverage: More than the basics

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Everyone’s insurance needs are different. While there are certain insurance needs (car insurance being one of them) that are preceded by circumstances, some are not readily apparent for the average person. These often overlooked forms of insurance turn out just as important in the long run, particularly if they cover possible yet unlikely risks such as extraordinary natural disasters.


Basic insurance coverage falls short under extreme circumstances. For instance, while home insurance is normally adequate to cover damages to one’s home, it doesn’t always cover for water damage resulting from floods. Taking specialized insurance coverage for these events may be obvious for some people--flood insurance is almost mandatory for people in flood plains--but could be skipped by others.



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Those who are thorough and extremely forward-looking enough to cover all bases can rest easy knowing that companies often give discounts for those with low risks. For instance, those in areas sheltered from heavy flooding can get the appropriate discounts in flood insurance.


While not everybody can afford to insure everything they own, it remains paramount for people to strive to be insured adequately. This automatically means going beyond the basics.



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Freeway Insurance offers low insurance rates and vehicular accident service. Visit this site for thorough descriptions of different forms of insurance coverage.

REPOST: Building a Dream House? Be Sure You're Insured

Insurance.com’s Michele Lerner explains to homeowners the need to check if their builders have the comprehensive insurance policy to protect their property "from foundation to rafters."

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Building a new home requires attention to detail, but while you choose your cabinet knobs and countertops, don't forget to make sure your property is properly insured from foundation to rafters.

If you're having a home built for you, you may be assuming your builder has all the insurance coverage you need. Under some circumstances, you're correct, but before you check off that mental box and move on, you should confirm your contractor's insurance policy.

"If you're having a home built in a community by a major builder like Pulte, there's generally no need for you to have insurance coverage because you don't actually own the lot or the home until you go to settlement," says Benjamin Saine, product manager for homeowners insurance with USAA insurance in San Antonio, Texas. "If you pre-purchased a lot and are having a home built on it, then you do need insurance coverage."

Saine says that the majority of consumers don't own their lot until the home is complete unless they're having a custom home built. Even then, some buyers don't own the lot until settlement.

"We recommend that you get a copy of your builder's insurance to check for adequate coverage," says Saine.

Carol A. Brunetto, a State Farm insurance agent in Bethesda, Md., says new homebuyers should review their purchase contract to make sure they aren't obligated for insuring home construction.

"You should get a certificate of insurance from your builder that is comprehensive and includes liability coverage even on completed construction operations," she says. "For instance, if your floor collapses because of shoddy construction and someone is injured, you want to be able to turn to the builder's insurance for coverage."

Brunetto says builder's insurance policies usually cover three years after construction is complete.

Home insurance and custom homes

If you're having a custom home built, you may need your own insurance policy.

"Whether you need insurance depends on your contract," says Brunetto. "Sometimes the general contractor is responsible for insurance, while other contracts say the homeowner needs to purchase builders risk insurance."

Builders risk insurance, specifically designed to cover homes while they are under construction, typically covers theft and vandalism of the tools and equipment being used to build the house and the materials, including in some cases materials being held offsite for future use. This insurance doesn't provide liability coverage or any protection for the home's contents since there typically won't be any personal possessions at the construction site, says Saine.

Builders risk insurance policies are generally written for nine to 12 months. Most can be renewed if there are construction delays, says Saine, but the insurance company will usually assess the project to make sure progress is being made on the home.

Homebuyers should purchase a home insurance policy with liability coverage in addition to the builders risk insurance policy, says Brunetto. Homeowners insurance will also provide coverage in case of a fire or storm damage. (See: "New homeowner insurance basics.")

"Liability coverage is critical for a construction site because of the risk that someone working on the site or a child or a visitor to the site could be injured," she says. "You should take responsibility to inspect the site and make sure your builder is adequately protecting the site, but you also need to buy insurance to protect your assets in case you are sued."

Saine says most people purchase $300,000 of liability coverage, but other levels are available.

Brunetto says that you may want to buy an umbrella insurance policy in addition to a home insurance policy for extra liability protection, particularly if you have significant assets.

New construction insurance premiums

Typically, the amount of home insurance you need to purchase depends on the estimated rebuilding cost of your completed home, based on the size, the finishes and the materials to be used, says Saine.

Saine says most insurance companies will steeply discount the premiums because the home hasn't been completed. Once your home is complete, with flooring and appliances in place, you need to contact your insurance company to convert your insurance to a standard home insurance policy.

"Before the first shovel hits the ground on your home, you need to get your homeowners insurance in place so that you have liability coverage," says Saine. "The biggest risk of building a home is your liability in the case of a construction site accident."

Freeway Insurance offers various insurance options, including homeowners insurance. For timely updates on the insurance industry, subscribe to this Facebook page.

All you need to know about staged accident scams

A common and distressing insurance scam in some states today is the staged accident scam. Frequently reported in places as far apart as Nevada, Michigan, New York, Florida, and California, the scams involve fraudsters deliberately setting up an accident and taking advantage of their victim status to overinflate insurance claims.  These scams often target highly insured vehicles such as luxury cars or big rigs and drivers seen as less likely to be confrontational, such as women and elderly people.

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There are many telltale signs that reveal that an auto collision accident is possibly staged.  Staged accidents frequently use clunky cars that are often filled with people (usually to inflate bogus medical claims).   They also prefer high-speed crashes.  The methods employed by fraudsters are crude, which is often a dead giveaway to their intentions when observed.  These often involve actively observing the victim and waiting for the right opportunity to induce a collision.

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Details on these methods and more are available here and here.

The wallet isn’t the only thing hurt by staged collisions.  These faked accidents often cause real accidents themselves, which can lead to the deaths of people not involved in the ruse itself.

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To help prevent road accidents, staged or otherwise, and perhaps to save on insurance coverage, drivers would be wise to practice defensive driving.  Moreover, when one gets the suspicion that something is amiss when in an accident, it is best to take as much evidence of the collision as possible and have the police involved.

Insurance providers like Freeway Insurance Services often provide insurance holders incentives and discounts for good driving behavior.  Visit this website for more updates.

Identity: How to protect it against thieves

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Many think that only material things can be stolen from an individual. Identity, even though it is intangible, can also be a target of thieves. According to the latest Identity Fraud Report conducted by Javelin Strategy and Research, co-sponsored by Intersections, more than 12 million people became victims of identity fraud last year. And 5.33% of this number was linked to tax administration-related issues.

Tax time is considered one of the busiest times of the year. Tax payers renew their expired IDs and licenses before presenting them to the taxation offices. Some individuals input their identity information on their mobile phones and gadgets, which are easy targets for thieves and computer hackers. Tax time is, without doubt, the perfect time for identity thieves to steal other people’s personal information at their own disposal.

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The good news is there are some insurance firms that offer services that aim to protect their client’s identity. Statefarm and Freeway Insurance, for example, offer protection coverage to assist with the costs resulting from restoring and repairing a consumer’s identity and credit history.

But insurance buyers should study the insurance provider first before purchasing an insurance plan because not all insurance companies offer the right service that fits their needs. A little time spent scrutinizing insurance companies translates to secured identity for a long period of time.

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A more detailed explanation on identity theft insurance can be read at this website.

A good case for business insurance: Cheap labor is expensive

There are broad types of business insurance that lapse into extended use as global supply chains get bigger. Prior to outsourcing, business insurance was a straightforward deal, financially buffering the insured against claims on workers’ compensation, property damage, and liabilities in the event of damaging incidents.

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It is easy to lose sight of offshore business risks, as exhibited by the handiness of fire hazards in overseas subcontracted factories for multinationals, like Wal-Mart’s clothing production chains in Bangladesh. Global operations are traps for supply chain ignorance, as, by folly, corporate headquarters float on another strategic world, away from the crunch of logistics and the independence of suppliers.

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Wal-Mart has claimed ignorance of the Bangladesh leg of its supply chain. In insurance terms, or lack thereof, the company stands to indemnify damages out of its own pocket. In myriad costly ways it’s already doing so by dialoguing with all recognized suppliers and issuing factory safety modules and training funds—all these without establishing the global workers and factories under its wing.

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Standard business insurance imputes responsibility over workers and property on the insured, or the employer. Wise insurance brokerage from fiercely independent companies, like Freeway insurance, will caution businesses on this legal obligation. In some states, workers’ compensation and liability insurance are mandated. The judicial scenario, however, is more complex in multi-sited operations, especially as the network of subcontractors branches out along the supply chain.

Insurance coverage is evolving to follow the chain of operations. Where property, liability, and workers’ compensation may apply across global supply chains is an industry talking point enjoining multinationals today. As Adidas put it, global workers should be part of risk assessment scenarios that lead to more comprehensive business insurance coverage.

Freeway insurance is a trusted brokerage across several key American states, with its seat in California. It assists clients in scouting for comprehensive business insurance, covering all types. For more information, visit the company website.

The sad truth about motorists and their car insurance knowledge

How much do you know about car insurance? If you answered “not much,” then, sadly, you’re like most American drivers who can’t respond to basic questions about their insurance coverage.

This is according to a multiple-choice survey of 500 drivers conducted by Insurance.com. The average score was a dismal 32 percent, and even when accounting for the drivers’ gender, age, and location, no group scored higher than 39 percent.

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“We were shocked at the results,” Michelle Megna, managing editor at Insurance.com, told The Los Angeles Times. “People spend an average of $800 to $2,000 in annual premiums, but they know very little about what they have bought,” she explained.

The quiz asked 10 questions about car insurance basics. Drivers scored lowest in questions that deal with:

• Comprehensive coverage (only 2 percent got the right answer);
• Typical discounts available for motorists; and
• Factors that insurance companies use to set rates.

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Although the staff at Insurance.com were not expecting perfect scores, the fact that people who said they read their entire policy scored the lowest (average score is 28 percent) is an indication that most motorists do not understand their policy. And this can lead some drivers to make significant mistakes when it is time for them to sign their insurance coverage.

Insurance experts thus advise drivers to carefully read and fully understand the policy before signing on the dotted line. And in this day and age where information about insurance coverage is easily accessible online, experts suggest that drivers seek guidance from well-versed agents, like those from Insurance.com and FreewayInsurance.com.

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Log on to this website to further boost your knowledge about auto insurance.

On renter's insurance: Do you really need it?

As people get older, they tend to realize their increasing need for several kinds of insurance. They start with getting a life insurance, and then they secure their cars. Then they'll feel that they should not take their house for granted and get a homeowner's policy. However, only a few individuals find themselves needing to purchase a renter's insurance since only a few companies give importance to this.

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But renter's insurance should not be overlooked. In fact, especially to those who are still young or still thinking of getting their first property protection policy, getting a renter's insurance is a good starting point in knowing anything about coverage policies, because it is cheaper and more affordable, and, compared to the technicalities involved in other insurance services that protect homeowners and automobiles, it is simpler to understand.

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Although renter's insurance covers only the material possession of the tenant—since the building or the apartment itself is automatically covered by landlord’s insurance—it is still important to have one. This type of insurance, in simpler terms, is essential because it prevents the tenant from losing hundreds and thousands of dollars in the event of robbery. It also covers the entire contents of the rented residence, and also the loss of use, say, if the apartment becomes affected by fire. In that case, the tenant will obtain money to finance his search for temporary lodging.

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Freeway Insurance agents can help you select the right renter's coverage. Visit this website for more details.

Insuring the house: Points to ponder before moving in

Both tenants and new homeowners make lasting investments for themselves when they choose to sign the papers to their new home. Be it theirs by deed or given by lease, the home is an important part of any person’s life, and steps must be taken to secure it in the event of unforeseen circumstances. Regardless of whether the home is rented or owned, it is a person’s personal castle and must be safeguarded at all costs.

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Two markedly different types of insurance exist for both the tenant and the homeowner, each with its own benefits to the occupiers of the home and their possessions.

Renter’s insurance is used to protect the tenant’s possessions. This is useful in the event of fires, break-ins, and other unforeseen events, which are usually not the responsibility of the landlord, whose main concern is the building. Having renter’s insurance enables the tenant to protect and recover from such events, which can be just as damaging as those that take place in a home.

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Home insurance is a must for any homeowner, particularly new ones. The home is a particularly large investment—the largest most people would ever make in their lifetime. Unlike the tenant, the homeowner is fully in charge of both the building and the possessions inside it, and must take the necessary actions to protect it from damage. Home insurance allows homeowners to recover quickly from unforeseen events without compromising the integrity of their homes.

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Freeway Insurance’s website offers more information on insurance coverage for renters and homeowners.