Before You Buckle Up: Insurance Tips for New Drivers

For new drivers, earning that license may seem like the biggest challenge when it comes to driving. However, obtaining the right car insurance is another obstacle many drivers don’t consider. These tips will help you keep in mind all you need to know about car insurance as a new driver.

Consider Your Car Insurance Coverage

If you are driving a car that is registered in your name, you likely need car insurance. It is the law in most states. However, there are several different types of coverage. Understanding all of the coverage types is the first step in determining the type or types of insurance that will best meet your needs.

Liability insurance is the most frequently discussed type of insurance because it is required in most states. It covers the cost of both injuries to other parties and property damage in the event of an accident. 

Personal injury protection is the car insurance that will cover the cost of your medical expenses as the driver whether you are at fault for the accident or not. This coverage will also cover your passengers. 

Uninsured motorist insurance is sometimes overlooked. While most states require insurance, in the event that you are in an accident and the driver of the other vehicle does not have insurance, this coverage can cover your medical expenses and also the cost of any vehicle repair. This insurance is sometimes required, but it can vary from state to state.

Collision and comprehensive coverage is an optional coverage because it only addresses your vehicle. Collision covers the cost of repair or replacement should an accident occur. If your vehicle is damaged through other means, such as a natural disaster or vandalism, comprehensive coverage will cover those expenses. Though these types of insurance are not required by law, if you have an auto loan, you are often required to carry these types of coverage. 

Other coverage options include towing, roadside assistance and rental car coverage. With any type of coverage, it is essential each driver read the fine print to understand what is and isn’t covered.

Determine Your Coverage Needs

Your coverage needs are determined, at least in part, by the state in which you live and whether or not you own your vehicle. Researching state-by-state requirements and understanding what those requirements mean is important. For instance, if your state requires 20/40/15 coverage, that means you have to carry an insurance policy that will cover $20,000 worth of medical expenses per person, with a total coverage payout of $40,000 in medical expenses. That coverage also requires you to have $15,000 worth of property damage coverage. In addition to state minimums, if you’re still paying off your vehicle, the loan company will likely have insurance coverage minimums for you to follow. 

Beyond those requirements, your coverage needs may also depend on your risk tolerance. Many people feel that the state minimums are not enough. You can be sued for any additional expenses not covered by your policy making additional coverage a good idea. Any damages you are held liable for can come out of your bank accounts, your assets or even your paychecks through wage garnishment. 

Combat Premium Costs

Even if you choose to carry more than the minimum coverage, there are many ways to reduce your premium cost. When you establish your insurance policy, it will come with a deductible. The deductible is the amount of money you are responsible for paying out-of-pocket before your insurance coverage begins. Based on yours savings or your current income stream, you may opt for a higher or lower deductible. If you opt for a higher deductible amount, your monthly premiums will be lower. But you will feel more of a sting should you need to use your coverage. 

In addition to adjusting your deductible, there are other steps you can take as a new driver to lower the cost of your insurance premiums.

    • Shop around. As a new driver, working with a company such as SelectQuote you can get multiple quotes with one call to (855) 777-6090.  It is great way to compare rates on the same level of coverage. And you can always start by visiting us online at Www.bondinsurancegroup.com.
    • Consider how often you pay. Many insurance companies offer discounts to drivers who pay their insurance for the whole year in single or twice-yearly payments. 
    • Build your credit score. Your credit score impacts your premium costs. Establishing several lines of credit, paying your bills on time and keeping your overall utilization ratio low can go a long way to keep your credit score healthy.
    • Inquire about discounts. Insurance companies offer a variety of discounts based on everything from clean driving records and anti-theft devices to good grades and defensive driving courses. Ask specifically about all of the different discount options that an insurance company offers. 
    • Bundle your policies. If you find yourself in a position where you need to insure multiple cars or carry multiple types of insurance (renters, homeowners, etc.), you may be able to obtain a discount for bundling or purchasing all of your coverage from the same company. 

In the Driver’s Seat

Understanding all the requirements is a starting point for how much insurance each new driver needs. From maintaining a clean driving record to paying your bill yearly, there are  ways to make additional coverage more affordable. It’s peace of mind for your wallet and peace of mind as you get behind the wheel. 

 

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Disaster Strikes Your Second Home: Are You Prepared?

Once you decide you’re financially ready to buy a vacation home, one important step is insuring your new pad. It’s different than buying insurance for a primary residence. Factors such as where it’s located, who stays there and what amenities are available will help determine your home insurance needs.

Your Vacation Home Versus Mother Nature

For many people, the whole idea of a vacation home is to be closer to a sandy beach or among the crisp mountain air. That perfect location for rest and relaxation may come with some additional insurance costs.

Hurricane season and intense rainstorms underscore the importance of knowing your coverage. The point applies to primary residences and vacation homes. When hurricane Florence hit in September 2018, more than 30 million people were under a flood watch and media outlets reported only about 3 percent of North Carolina and South Carolina homeowners held insurance policies

And the cost from homeowners without insurance can be significant. When assessing the aftermath of 2017’s Hurricane Harvey, the Texas Department of Insurance reported the average cost of flood damage caused was $80,000.

You can purchase a policy through the National Flood Insurance Program (NFIP), which is run by the Federal Management Agency (FEMA), or private insurance companies.

Other natural disasters or risks associated with a given region should be considered, as well. 

For areas where earthquakes or other seismic activity are common, supplemental policies to cover these risks are available. If you live in California, you also can receive it through the California Earthquake Agency (CEA). 

But Hawaii homeowners affected by volcanic eruptions and related damage were less likely to find coverage.

Whether it’s one of the aforementioned risks or another threat like wildfire, the area in which the home resides can result in higher deductibles for your property.  

Insuring Your Vacation Home for Guests

Renting out your vacation home is becoming more common. Homeowners do it to recover their investment and earn extra income. Unfortunately, guests can inadvertently hurt themselves or, inexplicable as it may seem, intentionally damage the property.

Don’t have enough insurance — or the right coverage? Additional headaches could follow. So, if you go this route, you’ll want to consider the potential insurance needs.

Before renting out your vacation home and selecting insurance, you’ll want to determine how often you’ll rent out the property and what service you’ll use.

Many insurance carriers will make a distinction based on how often you rent the property. If you plan to rent your vacation home occasionally, your carrier may offer a rental rider to add to your existing homeowners policy. These typically provide limited property and liability coverage. 

If regular renters seem more likely, your needs could warrant business insurance. 

The other important consideration is what service, if any, you will use to rent your property. Because of its large community and ease-of-use, Airbnb is a popular choiceAirbnb offers an insurance program to hosts. It would be easy for a homeowner to think they’re completely protected by the program. That would be a mistake.

It does provide coverage up to $1 million for property and liability claims. But there are still gaps. It doesn’t cover certain liability scenarios, such as assault, or protection for your valuables. 

Having rental guests? Don’t guess. Contact a Bond Insurance Group licensed agent to know what coverage you need. 

Insuring Your Vacation Home From Itself?

First, similar to how coverage works with your primary residence, the home’s specifications and features will affect how much your insurance costs. 

How old is the home? And what materials make up its construction? A carrier will review these factors when pricing coverage.

The style of home also could dictate cost. A four-bedroom, single-occupancy house on the beach may cost more to insure than a condominium two streets away. 

Not only would construction and age affect the costs, but how the property is managed could, too. Features or services provided (or not) by a property’s homeowners association, such as security, may affect cost.

Speaking of features, amenities that pose a risk could increase premiums and the need for more liability coverage. Pools and hot tubs are a prime example. 

Other Implications and Getting Help

When adding up the factors that go into insuring your vacation or second home, the costs can be greater than that of your primary residence.

Keep in mind the implications. If disaster strikes and you don’t have the right coverage, your insurance company could deny your claim. Additionally, in certain scenarios, they might decide to cancel your current policy or request you switch to a business policy. The latter may lead to higher premiums. 

What are the Benefits of Bundling Home and Auto Insurance?

We’ve all seen the ads. Whether in a museum of inexplicable accidents or a fitness class where alter egos debate coverage, the messaging often includes: Bundle your home and auto insurance. 

But should you?

It often leads to greater savings and better service. Let’s explore why.

Most Carriers Offer Multiple Products

Bundling home and auto policies provides a good deal for most. If you can get a single stop for your insurance needs — and save money — who wouldn’t? 

Aside from financial savings through companion discounts by purchasing multiple policies, a single carrier can save you time.

Bundling Policies Should Save Money

For bundling to make sense, combining your home and auto insurance under a single carrier should save you some money.

Often called a multi-policy or companion discount, bundling home and auto insurance can save you as much as 20 percent to 30 percent on premiums than if you purchased the policies from separate companies.

Now, that amount can vary by state and carrier. 

A byproduct of bundling can result in financial benefits down the line, as well. In certain circumstances, such as a car and house each incurring damage in the same incident, you could save you money. When you bundle, you can save by filing a single claim and paying one deductible. If you have multiple carriers in that same scenario, you would need to file claims with each carrier and pay multiple deductibles.

Hopefully you never encounter an incident where both your home and auto are damaged. If you do, saving some money could make you feel a bit better about the situation.

Bundling Should Save Time

In this day and age, where our attention is pulled in many different directions, bundling coverage could look attractive by the time savings alone.

When you bundle coverage, it should reduce administration such as paperwork and websites to visit. Overall, the need to communicate with multiple providers goes away. And when changes need to be made, having that relationship with a single provider can help simplify the process of needing to add coverage or address issues.

Loyalty Can Work Both Ways

We mentioned issues prior. Not only could you develop a personal relationship with a carrier, but that carrier can look at you differently if you have multiple products with them.

Live in an area with severe weather? When carriers get skittish about providing home coverage, it’s easier to obtain or keep your coverage if you have bundled products. They know if they don’t keep you as a client in one product, you’re likely to switch to another carrier for the other service.

Speaking of loyalty, carriers can also offer more expansive bundles. These combinations of policies work best for people who are looking to not only bundle home and auto policies, but also perhaps, as an example, a recreation vehicle or two as well as another property. 

These bundles can provide the same advantages of time and cost savings. But before committing to a single carrier for most of your insurance needs, consider and evaluate some key criteria about the company.

Sometimes Bundling Isn’t The Answer

Even though bundling policies provides benefits for many people, in some instances it doesn’t make sense. First, you want to make sure you’re getting the same coverage for your money. Don’t skimp on coverage because you could end up paying more in event of a loss down the road. 

Also, certain special items, such as premium vehicles, may not work well in a bundle.

Borrowing Money? What Loan is Best for You?

Most people need to borrow money at some point. Americans owe more than $13 trillion in total debt. Borrowing is clearly an expensive proposition for many American families.

If you do find yourself borrowing to buy a home, a car, an education, or anything else, it is important to look at the pros and cons. It’s all about making the right long-term decisions and minimizing out-of-pocket costs. Let’s look at what you need to know to best evaluate loan options available to Americans today.

Common Types of Loans

Loans come in many names and forms. When looking at consumer loans (loans to people and not businesses) there are four main categories: mortgages, student loans, personal loans and auto loans.

While these are the most common ways to borrow, there are some substitutes for traditional loans to use instead. Those include credit cards, lines of credit, home equity lines of credit and borrowing from yourself with a 401(k) loan.

Not all loans are created equal. It is important to understand some of the similarities and differences between the various types of loans and alternatives.

What All Loans Have in Common

All loans and borrowing products have a few features in common. Here are a few of the most important places to look:

Interest Rate

The first place to look with any loan is the interest rate. This is the main way you pay for borrowed funds. Depending on the type of borrowing, rates can be single-digit percentages or hundreds of percentage points for the worst short-term loans.

Fees

Common fees with loans include origination fees, late and returned payment fees, annual fees and early payoff fees. Fewer and lower fees are better.

Minimum Payment

Every loan requires you to pay it back somehow. Depending on the type and duration of the loan, your minimum payment will vary.

Payment Schedule

The vast majority of loans require monthly payments, but some allow you to pay more frequently or require a different schedule.

Lender 

Is the company you plan to borrow from an upstanding, trustworthy company? Only work with licensed, reputable lenders.

Features of Popular Loans

Here is a brief summary of each of the major types of borrowing, including traditional loans and other lending products.

Mortgages

Mortgage loans are a type of loan where you borrow to buy a property, most often a single family home or condo. The most popular type of mortgage is a 30-year fixed loan, where you pay the same payment and interest rate for the next 30 years or until the loan is paid off. 

Student Loans

Student loans are one of the fastest growing categories of borrowing. From banks and nonbank lenders, student loans help pay for the cost of a college or university education. Some loans are backed by the U.S. government, which means lower rates and better terms than private student loans.

Personal Loans 

A personal loan is an unsecured loan. The best personal loans these days often come from credit unions and online lenders. Payday loans fall into this category. You should avoid this type of predatory loan if at all possible. Payday loans typically charge high interest rates.

Auto Loans

Car loans are similar to a mortgage, except secured by the car instead of a home. When a loan is secured, it means the bank can take (foreclose) the asset if you stop paying. Most car loans are around two to seven years long with a fixed monthly payment

Credit Cards

Credit cards are a form of unsecured loan, and they often charge interest rates from around 7 percent for the best cards and borrowers up to 30 percent for the worst cards. Beware credit card debt. It is a lot easier to spend than it is to pay it back.

Lines of Credit

A line of credit can come in several forms. One popular form is as a personal loan, or an unsecured loan. Lines of credit are revolving accounts, which means you can add to the balance and pay it off again and again over the life of the account.

Home Equity Lines of Credit 

A Home Equity Line of Credit, or HELOC, is a secured line of credit. It is a hybrid of a personal line of credit and a mortgage. Because a HELOC is secured by your home, it gets a better interest rate than nearly anything else other than a mortgage. But you can spend on it like a credit card.

401(k) Loan

A 401(k) loan should be a very last resort. Taking from your 401(k) means borrowing from your retirement, and if you don’t pay it back you get hit with a handful of fees and penalties. Avoid this type of loan if at all possible.

This is not an exhaustive list of every type of loan. Many others exist that fall within these categories, and there are some less common and customized loans available in real estate, business, construction, and other areas.

Go Into Lending With Your Eyes Wide Open

Some finance experts suggest there are good debts and bad debts. Good debts arguably include a mortgage, which get you a home, and student loans, which get you an education. However, not all student loans or mortgages are good or affordable.

When it comes to cars, credit cards, and anything else, it’s best to avoid borrowing if you can’t afford to easily pay it off in full from savings. If you pay off your credit cards in full before the due date, you never have to pay interest. This is where valuable rewards cards come in. Savvy spenders buy with cards and pay them off to get rewards but avoid the costs.

Even with “good debt,” borrowing has costs. Avoid borrowing when you can. But if you do need to take out a loan, make sure you get the right loan with the most favorable terms for your needs.

 

Top 12 Questions (and Answers) About Life Insurance

Even the most calm and collected person can become confused by the prospect of getting life insurance. 

So many of us know we need life insurance, but we also feel we don’t understand it enough to make the best decision. Good thing at SelectQuote we know when it comes to investing your money in ANY kind of purchase, the only stupid question, as the saying sort of goes, is the one you didn’t ask.

There’s a funny thing about so-called dumb questions—a lot of people have them.

And with that, here you can find answers to some of the questions you have about life insurance but don’t feel comfortable asking out loud.

Do I Need Life Insurance?

If anyone depends on you bringing in money in order to survive, you need life insurance. It’s a great comfort to know your loved ones will have much-needed money in the event of your death.

Even if you’re single, with no dependents, you may still need coverage:

Did someone co-sign a loan for you? In the event of your death, that co-signer will be responsible for your remaining debt.

Might your health change? If you have a family history of life-threatening disease, it’ll be cheaper to get insurance now than when you’re older.

Are you planning on a funeral? It’s an unpleasant situation to think of but a policy that at least covers your funeral and burial cists can take a lot of pressure off surviving relatives.

What Kind of Life Insurance do I Need?

There are two basic types of life insurance:

Term life insurance covers you for a specified period of time.

Permanent life insurance covers you for your whole life, which is why you’ll also hear it referred to as “whole life” insurance.

As time goes by, financial responsibilities tend to lessen (kids grow up and get jobs, your mortgage gets paid off) there’s less of a need to carry a large insurance policy beyond a certain point in life. Most likely, the best bet for you will be term life insurance that covers your dependents during your income-producing years.  

What About Permanent Life Insurance?

The biggest reason why most people avoid permanent life insurance is the cost. It’s more expensive than a term life policy. It also doesn’t make sense for most people. Unless there are special circumstances, there’s limited need in most families for a large life insurance payout in the insured persons later years. Permanent life insurance tends to be most useful for people who expect to leave a large estate and whose beneficiaries might need the money to help ease the tax burden on that estate. 

Should I Take the Coverage My Employer Offers?

Absolutely. It’s probably a good deal and your premiums will be automatically deducted from your paycheck. Keep in mind any employer coverage you have will end if your employment ends. We’re not suggesting you’d quit your job without a game plan or get yourself fired, but we do live in a world where workforces sometimes get reduced and corporate mergers result in layoffs. It’s a good idea to have private insurance in addition to any coverage that comes with your job.

Where Do I Start to Buy Life Insurance?

Here’s a little something we know quite a lot about at SelectQuote. It’s our job to help you find the right insurance plan for you and your family. Talk with one of our licensed agents and we’ll get you the information you need to make the best choice. 

How Much Life Insurance Coverage Should I Get?

There are various recommendations to estimate how much coverage you need, but nothing compares to a careful analysis of your financial situation and exactly what you might count on a life insurance payment to do for your beneficiaries. That means only you can answer this question, but it doesn’t mean you can’t get some help. Our agents are here to help answer your questions and get you the coverage you need. 

Check out our online life insurance calculator. It also helps if you know what an insurance company takes into account when calculating a quote.  (Here’s a clue: Pretty much everything!)

What Information Will I Need to Provide?

Every company has its own application process, but common information that most will look for includes your height, weight, date of birth (DOB), some answers to health-related and lifestyle questions and an overview of your financial situation.

So, I Need to Answer Questions and Give Some Information?

Sort of. When it comes to specific health-related questions, your insurance company will most likely help you out by requiring a medical exam. Some companies will arrange for a qualified healthcare professional to come to you. Among the basics covered by such exams: medical history, current medications, family medical history, blood pressure, heart rate, basic heart function (determined by stethoscope), height/weight check, blood/urine samples, lifestyle questions.

What Kind of “Lifestyle” Questions Will I be Asked?

Before agreeing to insure you at a particular rate, your insurance carrier will want to know if you have any habits or engage in any activities that could be harmful to your health. Some questions to expect: Do you smoke? Do you drink? How much do you drink? Do you use recreational drugs? Do you have any hobbies that involve physical risks?

What if I am Not Completely Honest on a Few Questions?

That’s a really bad idea. A company can only insure you based on the quality of the information it has to go on; if you don’t give honest answers, odds are you won’t get a policy that truly meets your needs. To use a stronger word—lying on your life insurance application company can also result in a policy being denied or cancelled once the lie is found out. And if a serious omission of truth is discovered after you die, there’s a possibility your beneficiaries won’t receive the payout you set out to provide for them in the first place.

Who Gets All This Information?

The information you provide and the results of your medical exam are given to someone called an underwriter. The underwriter’s job is to assess all of that information and decided how much of a risk the company will be taking by insuring you. Those are the basics, but you can learn more, if you’d like.

Will I Ever Need to Change Life Insurance Coverage?

Life changes. New dependents may arrive on the scene (e.g., children or elderly parents) current dependents may go out of your life, (e.g., divorced spouses or no-longer-dependent children). It’s good idea to review all of your insurance, life insurance included, at least every three years, to be sure your needs are being met and your beneficiary choices are in order.

You can get as in-depth as you want to in learning about life insurance. However much research you do, one of the most important pieces is to decide exactly what you want your beneficiaries to be able to do should you die and to then find the most straightforward policy for accomplishing that goal.

Here’s wishing you all the best in finding the right life insurance for you so you and your family have peace of mind for the long run.