Are you protected?

[dompamar]

Hey everyone,

First off, a little about myself. Since this is my first post...My name is Dom and I’m located in Oregon, USA. My brother told me about this forum about a week ago or so, and I am on it daily. I find myself checking the forum as soon as I get to my desk in the morning. I currently have a desk job. I also have a small business that my wife and I recently started. I have some experience selling online and I am currently learning how to get product into stores (small gift shops). I do believe that I will reach financial freedom and that is why I am here, to learn and to help. I am glad to be a part of it, thanks.

Secondly, I have already gained a ton of helpful info and I am thankful for that. As I was driving today, I thought of a way that I could possibly give back to the community here. And if you are focused on making money, starting businesses or just want to protect what you already have, then read on. I don’t write often, so please excuse poor grammar, misspelling and sentences that don’t make any sense.

PS: This will almost sound like I’m trying to sell you insurance, but I’m not.

I am an insurance agent (for now). There are parts of the insurance world that many people do not understand clearly, or just have no idea about at all. And not knowing certain information could be very costly for someone. Many people already know all or most of what I’m about to say, but every week I come across people who are clueless. I will try to make this as simple as I can. Keep in mind that I have only been in the insurance biz for several months now, so I am no expert. I mostly sell auto and home insurance. And I will soon learn more about other types of insurance. For now I’ll fill you in on what I do know. This is very basic information, but I do think some people will benefit from this. If I only help one person, then this post is worth it.

Keep in mind, all of this comes down to risk. So this may not matter to you at all. Some people just want to save as much money as possible, no matter what. And sometimes you can only pay what you can pay. Regardless of who you are or where you are in life, I do believe this info is worth knowing.

Let’s get started.

With insurance, you have limits of coverage. This means that your insurance company will only pay out up to your limits in the event of a loss (i.e. auto accident or your house burns down). Keep in mind different states have different minimum requirements on these limits.

For auto insurance, everyone has heard the term “liability” as well as “full coverage”. But what many people do not know is that it is broken down into different categories; Bodily injury, property damage, uninsured/under-insured motorist coverage etc (as well as more, but we won’t go there right now). These apply to different incidents. All of them are pretty self-explanatory:

· Bodily injury coverage: covers the cost of someone else getting hurt if you were in an at-fault accident (i.e. you rear end someone and it causes the person you hit to break their neck).

· Property damage coverage: covers the cost of repairing a brand new Porsche (property) that you just rear-ended.

*Coverage is what your insurance will pay the other party when you are in an at-fault accident.

These are the main things you should understand. If you are at fault in an accident, you are liable for all of the costs. You’re probably thinking “Duh! Everyone knows that! That’s why I have insurance!”…but let me ask you this, do you know what your limits of liability are? Some of you probably have no idea. There is a lot of people who call to get auto insurance and they want the best rate. Makes sense, right? Well doing this means that you will likely have the lowest limits of coverage that you can legally get. And that can be a scary place to be. Why? Let me explain.

As soon as your insurance company pays up to its limits (coverage), YOU are liable for the rest. This means that if you have low coverage, and you happen to get in an at-fault accident...let's say you crash into an expensive car AND you put that driver in the hospital for several months due to a bad injury, your limits can all of a sudden look very small. Medical bills add up very fast, and them on top of repair bills for an expensive car...you get the idea. This means that you can get sued for the bills (costs) that your insurance didn’t cover. If it was really bad, the person could come after your retirement, your house and just about any of your assets. They can even garnish your wages. Now this may seem extreme, but it does happen. All because people did not have enough coverage and they were in the wrong place at the wrong time. Life happens, mistakes are made.

Another example. Here in Oregon, the state minimum requirement for bodily injury coverage is what we call 25/50 ($25k in coverage for one person, and $50k in coverage if you hurt more than one person in a car accident). These numbers are the TOTAL amount of coverage. NOT $25k/$50k per person. That is not a lot of coverage when you consider how expensive medical bills can be. Surgery and broken limbs are very expensive and can exceed $25k easily. This part gets confusing, I know. Let me put it this way, say you hit a car that has one driver, you have up to a total amount of $25k that your insurance company will pay towards bodily injury for that driver. If you hit a car with a family of 4 in it, you up to a total amount of $50k that your insurance company will go toward the medical costs of all people in that car. You following me?

So, do you have a house? Do you have a retirement fund? Don’t want to get your wages garnished? Take a few minutes and look over your insurance documents or call your insurance agent or company and ask about your limits. Ask how much it would cost to increase them. It is usually very reasonable to increase your limits. Sometimes it’s a little as an extra $10(ish) per month to double your liability coverage.

Make sure your butt is covered.

-Dom

 

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[mayana]

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