Wisconsin Law Misses the Point on Higher Car Insurance Liability Limits

November 18th, 2011 jess Posted in Claims No Comments »

Wisconsin recently enacted a new law that substantially lowers the minimum car insurance required by law. While this sounds like a win for consumers at first, the truth is the new law could end up far more expensive for drivers in the long run. Lower coverage requirements leave drivers without enough financial protection to cover the damages from even a relatively small collision. Consumers need to realize that when the insurance runs out, the rest of the money to pay for repairs and medical bills will come from their own pockets.

Previous Limits Already Too Low

Consumer advocates complain that the minimum requirements for car insurance in Wisconsin were already lower than they should be. Before the new law is enacted, customers were required to carry at least $50,000 in liability coverage. The new law cuts that number in half. That leaves $25,000 available through the insurance company to cover all of the costs of an accident. In many cases, the medical bills alone will exceed the former $50,000 limit, especially if more than one person was in the car at the time of the accident. A $25,000 limit will hardly make a dent in common accident costs.

Consumers Bear the Brunt of Lower Coverage Limits

Once the insurance money runs out, consumers are left to handle the remaining bills on their own. Since the consumers who choose the lowest legal car insurance limits usually have lower incomes, this could become a serious problem for Wisconsin drivers very quickly. Motorists could face lawsuits and seizure of their assets in order to cover their liability costs after an accident. The new law actually benefits insurance companies far more than it benefits drivers because it limits the amount that the insurance company is responsible for.

Law Change Intended to Help Consumers

Wisconsin lawmakers passed this law with the best of intentions. It was intended to help more people afford to purchase car insurance during these difficult economic times. If more people can afford the minimum legal car insurance requirements, there should be fewer uninsured motorists on the road, which should help everyone in the event of an accident. The trouble is that when drivers are allowed to carry coverage that does not begin to meet the needs of almost any collision, the insurance is not effective for either party involved in the accident. The new limits will hardly scratch the surface of the overall damages, and the person who had been trying to save money on insurance will eventually have to spend far more money than they would have if they had purchased a more effective policy.

Advocates Urging Consumers to Purchase More than the Legal Minimum

The good news is that consumers can choose to buy policies with higher limits than the legal minimum. It is in every driver’s best interest to purchase enough insurance so he or she will be covered after a serious accident. Buying a policy with a higher limit might cost more in the short term, but it will be a much easier investment over time if it will provide protection against the high costs of damage or injuries after a collision.




4 Car Insurance Companies Offering New Car Replacement Coverage

September 19th, 2011 jess Posted in Claims, Insurance Companies No Comments »

While there are many advantages to buying a new car instead of an older model, one big drawback is the fact that they depreciate quickly. In fact, within the first year, a vehicle’s value may decrease 15 to 20 percent and another 15 percent in the second year. Every year after that, a car may depreciate in value 10 percent. Because claims for damage are based on how much the repairs cost, if your car can be completely written off, the payment you receive is solely based on how much your car is worth at the time of the accident.

New car replacement coverage replaces your old, damaged car with a brand new model or provides you with the cash equivalent of the vehicle. The coverage protects you from losing out on money, since sometimes the payment you receive for a complete write-off can be a lot less than you expect. The cost of this optional replacement coverage varies depending on the model, make and year of your car, though typically it is purchased for a car that is three years old or less from the model date.

MetLife

MetLife Insurance offers full replacement coverage with every policy that you purchase. There is no additional cost since the coverage comes standard, and your car will not depreciate in value for either the first 15,000[1] you drive it or within the first year, whichever one occurs first. There is also replacement coverage for shocks, tires and batteries for the entire length of your policy.

AARP

AARP Auto Insurance Program offers members a new car replacement option with their policies. If your car is totaled and no longer drivable within 15,000[2] after its purchase date or 15 months, whichever comes first, the insurance company will replace the vehicle with a similar car of the same make and model equipped with the same features without considering depreciation.

Allstate

If you are in an accident that renders your car beyond repair within the first three model years of the vehicle, Allstate[3] will provide you with a brand new car instead of giving you money for the depreciated value of your previous one.

Liberty Mutual

Liberty Mutual allows customers the option to purchase replacement coverage that would not only replace your current car with a vehicle of the same make, model and year, but you are able to receive a car that is one model year newer and with 15,000[4] fewer miles on it than your current vehicle.

For example, if you have a 2005 vehicle with 25,000 miles on it, you will receive money for a 2006 model with 10,000 miles on it. The only stipulations are that the car must be a complete loss and you will have to pay the deductible. This type of coverage is not available in all states and it is not for motorcycles or leased cars.

Not only do drivers lose their vehicles when involved in a total-loss accident, but they also lose all of the money they put into the car for added safety features and the down payment. By choosing to add new car replacement to your policy, you can be sure you will receive the same or an even better vehicle.

 


[1] http://www.metlife.com/individual/insurance/auto-insurance/index.html#basics

[2] http://aarp.thehartford.com/Auto-Insurance/

[3] http://www.allstate.com/auto-insurance/auto-insurance-features.aspx

[4] http://auto-insurance.libertymutual.com/auto-insurance-coverage/understanding-auto-coverages/better-car-replacement




Remote Car Control Smart Phone Apps – Convenient, but Maybe Not Safe

August 23rd, 2011 jess Posted in Claims No Comments »

Mobile smartphones have made our lives incredibly convenient in a number of ways. One of the latest trends in app stores involves apps that will unlock your car and even start it from your phone. The convenience of pushing a button from inside the house to warm up your car before you are ready to leave is undeniable, but the wireless network that makes it possible is not as safe as it could be. The truth is, if you can access your car through a wireless connection, someone else with the right hacking skills can do it too.

Free Apps Will Unlock and Start Your Car Remotely

One of the most popular remote apps is available for drivers who have the OnStar system. Other companies are beginning to enter the remote app market, however. Car Link Remote Start is a free app for iPhone users that can be used to lock, unlock, start, or find your car with your iPhone or iPod. Unlike the OnStar app, Car Link Remote Start users do not have to purchase a subscription to a service in order to take advantage of the remote operations offered through the app. All you need is a digital car alarm, an iPhone, and an iTunes membership to download the app.

High Tech Thieves can Access Apps through Laptops

The potential problem with the new apps is that they use wireless networks to communicate between the car and the smartphone. Research has already shown that hackers with laptops can cruise neighborhoods to tap into unprotected wireless signals from residences. The same technology can be used to tap into wireless signals from cars that are being controlled through remote apps. Once a hacker taps into the signal, they can control the vehicle the same way you are controlling it with your phone. It is a neat, tidy way to steal a car without having to physically break into it.

Tech Research Firm has Already Hacked Popular Apps

As part of their efforts to protect consumers from digital theft, a research company named iSec has focused a study on the feasibility of hacking into remote car control apps. They found that they could successfully gain access to a vehicle in a little over two hours once they found a signal. The company has produced a video that shows how easy it was for them to crack the system and start a car using a normal laptop. They plan to use their information to help app developers create safer systems and warn consumers of the potential dangers involved in using remote car control apps.

Mobile App Security Not Always Considered First

The rush to create the newest and most popular apps has outpaced the ability for security systems to be put in place to protect consumers from the dangers of transmitting sensitive information through wireless smartphone networks. Mobile networking has been added to hundreds of devices in the past few years without much regard to the potential safety risks. Watchdog groups like iSec are working to close those open doors and help improve security, but they warn that most devices should still be seen as open to hackers now.