There are many factors that determine your insurance premium as it relates to your personal situation. Coverage can vary significantly from policy to policy making it very important for the customer to know what is it they are purchasing and what may not be covered on a policy. In addition to coverage, insurance companies look at additional factors such as driving history, loss experience, credit score, years with prior insurance, profession, characteristics of home, types of vehicles, age, additional insurance policies active with carrier, city of residence, and various underwriting factors.
An umbrella policy is additional liability limits to provide excess liability coverage for your home, auto, and boat insurance. Umbrella policies are known for their value, as it picks up a large amount of protection, usually starting at $1 million, for a very low premium. These policies are typically purchased by anyone who is concerned about losing their personal assets from a claim, or if they have higher loss exposures at home, such as 3 young drivers.
An independent agency is not bound to one specific carrier, and has the rights to an existing book of business. A captive agency is one that is bound to a specific carrier, and the rights of the book of business belong to the carrier. A captive agency cannot use other outside insurance carriers to compete against their represented company.
Actual Cash Value in relation to an insurance settlement means that depreciation is factored into a settlement of a property loss. For example, a weather storm caused damage to a 10 year old roof, which needs $10,000 to be replaced. The adjusted value of the depreciated roof is $5,500, which is the settlement offer to the insured. If the insured had a $1,000 deductible, the adjuster would send a check for $4,500 to settle the claim.
Replacement Cost in relation to an insurance settlement means that depreciation is not factored into a settlement for a property loss. For example, a weather storm caused damage to a 10 year old roof, which needs $10,000 to be replaced. Since there is no adjustment for depreciation, the settlement offer to the insured is $10,000. If the insured had a $1,000 deductible, the adjuster would send a check for $9,000 to settle the claim.
An independent agency has ability to shop out an insured’s rates at any time among their represented carriers. It is recommended that most customers stay with a reputable carrier that is “A” rated or better to obtain subjective advantageous, such as underwriting exceptions, loyalty recognition, prompt service, and favorable rates. It is important for an insured to work with a trustworthy and professional agency to help handle these matters for them.