| The Fine Print: What You Need to Know to Protect Yourself |
| Written by Administrator | |
 Many people think they know how insurance policies work, and make incorrect assumptions about their coverage that either cost them money or make filing a claim a frustrating or confusing experience. Never assume; always ask. If you are using a broker or an agent, there may be less chance of a surprise, however, it’s advisable to educate yourself and talk to others about their coverage and solicit some tips.
What to look for in a contract:1. In the event that you and your insurance company disagree on something that arises in a claim, you want to be sure you have the right to sue. Although you certainly don’t anticipate a rift any more than you anticipate an accident, it is your right to have legal representation and secure the best possible chance of seeking damages. If you sign an agreement saying you give up your right to sue, you may regret it.Don’t be shy about modifying the terms of the agreement to your liking. Like any contract, specific terms may be stricken and the insurance company may agree to it. Simply cross out the applicable line or clause on the contract before signing and see what happens. If the agent or insurer won’t agree to your terms, then you know they’re the wrong company for you. 2. Depending on the car you own, you may want to be choosey about the kind of replacement parts used to restore it. Some insurance companies may try to save themselves money by stipulating that unspecified “aftermarket parts” may be used. If your vehicle is just to get you from point A to B and there’s no emotional attachment, you may be perfectly comfortable with any aftermarket parts installed after a collision. Less costly parts may reduce the resale value of your vehicle, however, and may not enjoy the same crash-test ratings of the original and aftermarket Original Equipment Manufacturer (OEM) parts. If your car is your pride and joy, an expensive or rare model, or simply a relatively new one you will have for some time, you will probably want to specify that “OEM” is in the contract with regard to parts. Again, strike and replace the clause or line you object to and replace it with what you desire, before signing and see what happens. You should know, however, that when you demand OEM parts, you could be penalized in some way, because OEM parts can be up to double the cost of non-OEM. For instance, the insurer may not pay for the repairs in full, leaving you to cover the balance, or they may charge a much higher premium. It may help to decide which way to go, if you’re mindful that the working parts are the critical ones at repair time when it comes to safety and retaining the value of your vehicle. It would be wise to consult the Certified Automotive Parts Association (CAPA) at www.capacertified.org to determine if the parts scheduled to be installed in your vehicle pass the minimum safety standards for aftermarket parts. Cosmetic details like grills, mirrors, etc. will have little effect on the performance and safety of your ride and whether you go with OEM or not will come down to personal choice and how much you’re willing to pay out of pocket. In the end, it’s a matter of weighing the pros and cons with an educated mind and knowing what you’re willing to pay to restore your vehicle. A further note on leased vehicles: without question, you will want to assure you will be getting OEM parts without exception, if your leased car needs repairs. Here’s why. Your lease agreement will state that you must return the vehicle in its original condition at the end of the lease term. You would be in breach of that agreement if you had non-OEM parts installed as part of the repairs and could lose your security deposit or a portion thereof. 3. Be sure to ask about the cancellation requirements for your coverage. This may not be part of the policy. Most insurers will continue to renew your policy after the expiration date unless they hear from you otherwise. Canceling a policy without following the proper protocol can leave a black mark on your record and may give other insurance companies cause to charge a higher premium because you’re considered a high-risk client. Cancelation usually requires you to notify the agent or insurer in writing if you plan to cancel the policy, and the effective date, as well as the date your new policy will take effect. Phone them to let them know of your intention. When you receive their paperwork acknowledging your request, make sure it’s accurate before signing and returning it to them. If you haven’t notified your agent or the insurer of your plan to switch companies and you get a renewal contract from your insurance company and don’t pay it, it will be noted on your credit report. That’s the last thing you need, so you’ll want to avoid mishandling your client responsibilities. |
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