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The 4C’s of Insurance: Children, College, Cars & Collisions
By Judi Kagiwada
Insurance is a product that everyone has to buy. It’s one of the only products we purchase in the hope that we never have to use it. But if you do, you don’t want any question of coverage. Here are some questions to consider.
Do I need to make any changes in my auto policy if my child takes a car back to college with them?
Yes. First, you should make sure that the classification of the car is correct. Inexperienced drivers are classified as either occasional or principal operators for rating purposes. Obviously, listing an inexperienced operator as an occasional driver is less expensive. If your child brings a car with them to college the policy should be changed to reflect her or his principal use of the vehicle. If an inexperienced driver is involved in an accident and it is determined that they are the principal driver of a given vehicle, rather than occasional, this could be cause for denial of a claim.
Secondly, one of the factors used in rating an automobile insurance policy is the city or town where the vehicle is principally garaged. Be sure to let your agent know if the car will be away from your home and with your child at college. There is a special factor for any vehicle garaged out of the state of Massachusetts.
The Massachusetts auto policy clearly states that a company can refuse to pay claims under any or all of the Optional Insurance parts on the policy if they have been given false or misleading information that increases the risk of loss. Both of the scenarios I just mentioned could fall into this category.
On the other hand, if your child will be away at school, without access to the family car, perhaps you should talk to your agent about a possible credit on your auto policy.
How is my Homeowners Insurance policy impacted by the fact that my child is away at college?
If your child is staying in a dorm, the personal belongings they bring with them are covered up to 10% of your personal property limit. For example, if your limit is $50,000 they could be covered up to $5000. Something to think about, however, is the upper classman that may rent an apartment off campus. More than likely, your child would need her or his own policy to cover any belongings that are stolen or damaged.
Most homeowners’ insurance policies only insure your personal belongings against certain mishaps. Breakage, for instance, or loss by “mysterious disappearance” is not typically covered. How about that expensive lap top that was a graduation present? Maybe you would want to specifically insure this piece so that it could have broader coverage. For a small additional premium you could list this type of item and avoid your policy deductible if a loss should arise.
If I am in an accident and receive a surcharge is there anything I can do?
Insurance companies surcharge a driver if they determine that driver to be more than 50% at fault in an accident. There are two levels of accidents. If an insurance company pays between $500-$2000, it is considered a minor accident and the driver is charged 3 points. A major accident is anything over $2000 and 4 points are accessed.
If you receive a surcharge notice and you feel there are extenuating circumstances which contributed to the accident, you may file an appeal. The filing fee is $50 and you will be granted a hearing at a nearby Registry office. Weather related accidents are a perfect example of surcharges that are often times reversed.
My policy was cancelled for nonpayment of premium, is there a way to get it reinstated?
Most often it cannot be, and most insurance companies are now requiring that the new policy be paid in full. If this has happened to you, give me a call, I have a company that will provide financing for you.
A good way to avoid billing issues is to set up the policy on an Electronic Funds Transfer. This allows for direct withdrawals from your checking account each month. It is also a great way to avoid finance charges.
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