Wednesday, January 23, 2013

Insuring your leased vehicle

By: Edward L. Blais, JD, CIC

When considering purchasing or leasing an automobile, many people are opting for the
convenience of leasing. Though you never actually own the car, it may be ideal for individuals
who wish to consistently have a new vehicle. 

However, whether you lease or purchase your car, you must buy and maintain an auto insurance policy.

As you begin the process of leasing, the leasing company will require you to purchase collision and comprehensive coverage. These coverages are in addition to those required by law, including liability coverage. 

Collision insurance covers damage resulting from an accident with another car or object. To further protect the vehicle, comprehensive provides protection for covered losses other than Collision, such as fire, theft, and even including a deer strike.

It is important to note that some leasing companies may also require Gap insurance, which kicks in if your car is totaled. If your leased vehicle is damaged beyond repair, there will most likely be a “gap” between the amount you will owe the dealer under the lease agreement and the Actual Cash Value of the leased automobile. 

This “gap” primarily occurs because the insurance company provides protection based upon the car’s Actual Cash Value – the difference between the replacement cost of the vehicle, less depreciation. 

There are many specifics regarding Gap insurance, which can vary from dealer to dealer. Moreover, this coverage may be available under your own policy.

If you are considering an automobile lease or purchase, please contact Blais Insurance at 725.0070 and we would welcome the opportunity to review your options to make certain you are fully protected.

Thursday, January 10, 2013

If I rent an apartment, do I need insurance protection?

By: Edward L. Blais, JD, CIC

The answer to that question is an emphatic yes! Unfortunately, many renters find out the hard way that if their rented space is damaged or destroyed their personal property is not covered unless they have purchased their own renter’s policy to cover their personal property.

Many people are under the false assumption that their landlord’s policy on the building would provide protection for the tenants in the event of a loss. If you rent a house or an apartment, your landlord’s insurance will cover the landlord’s costs associated with repairing or rebuilding in the event of a fire or other disaster, but it would provide no protection for the tenants. 

Renter’s insurance is well worth the small investment, as it would protect you and your belongings in the unfortunate event of a covered loss.

Types of property losses that are normally covered under a well written renter’s insurance policy include: theft, vandalism, fire or smoke, lightning, explosion, windstorm along with specific types of water damage other than ground water seepage - renter’s insurance will not cover any form of ground water seepage or flooding, as this would require a separate flood insurance policy.

A renter’s or tenant’s policy of insurance offers three types of coverage:
  • Liability Protection
  • Personal Possession Protection
  • Additional Living Expenses

The purpose of liability insurance is to protect your assets in the event someone sues you for bodily injury or property damage caused by an insured. Typical limits for this protection that may be purchased range from $100,000 to $500,000. 

Renter’s policies also provide for medical payment coverage in the event someone is injured in your home. Coverage limit options exist for this coverage as well.

When deciding how much coverage you need for your personal possessions, be sure to have an accurate record of your items and their replacement value. It is a good idea to maintain a home inventory of your personal property including but not limited to appliances you may own, furniture, jewelry, electronics, clothing, etc. 

This list should also include purchase values, and remember to keep receipts whenever possible. You should keep this important information at a secure location outside of the apartment so you will not lose it in the event of a total loss to the building. This will make the claims filing process much quicker and easier.

Coverage of additional living expenses is essential if your property becomes uninhabitable due to a covered loss. If you need to relocate for some time, this coverage may help to pay for hotel bills, meals and other expenses. 

There is typically a cap on the amount of time this will be covered so make certain you are aware of policy limits and review them with your agent.

We at Blais Insurance would be happy to explain renter’s insurance in greater detail, and show you exactly how inexpensive this investment can be. Call us today at 725.0070 for more information.