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I’ve Never Had a Claim—Why Does My Insurance Keep Going Up?

by Posted in Auto Insurance, Homeowners Insurance, News Tagged , , , , ,

This is a common complaint among our customers who find their home and auto insurance rates continue to rise, even when they haven’t had any claims. We know this can be frustrating and we always do our best to find the most competitive insurance rates, no matter what type of insurance our clients need.

As we’ve noted before, the Florida insurance marketplace has some unique challenges, but the cost of insurance is rising in most states. Insurance companies look at many factors when they set their rates, only some of which you can influence—like keeping your driving record clean or improving your credit score. But there are some things which are beyond both your control and your insurance company’s control, factors which are at work in the industry at large. Here are a few things which affect the price of your insurance—even if you, personally, don’t have a claim.

Insurance is a “pool of risk”

First, understand that the central function of insurance is the sharing or pooling of risk. In return for a premium, the insurer agrees to pay for the covered losses of its policyholders. As the Insurance Information Institute (iii.org) rather poetically explains, “If risks—chances of loss—can be divided among many members of a group, then they need fall but lightly on any single member of the group. Thus misfortunes that could be crushing to one can be made bearable for all.”

Insurance protects against catastrophic loss, and in that role it helps to keep society functioning. We couldn’t get credit to buy a house or car, or to start a business if creditors couldn’t have some guarantee of being paid back in the event of a loss. A family who loses a home and all their belongings in a fire would be devastated without an insurance policy. A small business owner could lose everything if someone sued them after slipping and falling at their business. Insurance helps protect us all from financial ruin.

Claims have become more frequent

So remembering that insurance is a pool of risk, if claims become more expensive or more frequent, everyone in the pool will be affected. Simply put, you may not have made a claim, but plenty of other people have. According to Climate.gov, “In 2021, the U.S. experienced 20 separate billion-dollar weather and climate disasters, putting 2021 in second place for the most disasters in a calendar year, behind the record 22 separate billion-dollar events in 2020.” These events include wildfires, tornadoes, floods, and, of course, hurricanes. Plus, those claims numbers don’t include the more mundane events that take place every day—the fender benders, the burst pipes, and so on.

The cost of everything is increasing

This includes the costs to rebuild or repair homes and vehicles in the event of a loss. Home renovations, demand for new construction, and supply chain issues have limited the availability of construction supplies and materials, inflating prices. Auto claims costs are also rising because of similar factors.

Another significant expense for insurance companies is the rising cost of reinsurance (insurance for insurance companies).

Because of these factors, the cost of doing business has insurance companies scrambling. In order to stay in business themselves, they pass on these increased expenses to policyholders.

L & M Insurance Group—your independent agency

Despite the cost, buying appropriate insurance is still one of the best ways you can protect your assets. If you want to be sure you’re paying the most competitive rate for your insurance, why not call a local, independent agency like L & M Insurance Group? Our agents are well-versed in the Florida insurance marketplace and will be happy to answer your questions and give you a quote. We handle personal lines, such as homeowners and auto, as well as business insurance, health, and life insurance. Please call (813) 672-4100, or click here to contact us online. Let us help you find the best insurance coverage at the most competitive price.

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 Safe Driving Tips for the Holiday Season

by Posted in Auto Insurance Tagged , , , ,

Most of us are looking forward to spending more time with family and friends during this holiday season. These get-togethers might take place in our own communities or at a far-off home of a loved one. Unfortunately, there’s always an uptick in traffic accidents, injuries, and deaths during the holiday season. In fact, according to the National Safety Commission, “Traveling by car has the highest fatality rate of any major form of transportation based on fatalities per passenger mile.” This is likely because there are more drivers on the road, and those drivers may be distracted, in a hurry, driving on unfamiliar roads, or even driving while under the influence.

Whether you’re driving across town or halfway across the country, here are some tips to help you drive safely this holiday season.

Before you leave

Safe holiday driving starts before you even leave your house. If you’re planning a road trip for the holidays, spend a little extra time preparing yourself, your family, and your vehicle before hitting the road. Gas up the car and have it serviced, if necessary, and make sure you have an appropriate vehicle emergency kit. Sign up for weather alerts at your destination and along your route or check the weather online. You may be driving in weather conditions you’re not used to. Also check traffic reports to see what to expect. If you’re using a GPS, program your destination in before you leave. If you’re using an old-school map, review your route before buckling up.

Get a good night’s sleep the night before your trip so you’re not driving drowsy. And no matter how short a distance you’re going, allow plenty of time to reach your destination without rushing. Drive at speeds safe for traffic and road conditions.

Everyone in the vehicle should have their seatbelts buckled, and small children should be strapped into an approved car seat.

On the road

No matter how far your destination, always drive defensively. You can’t control what other drivers do, but if you stay alert and practice defensive driving, you should be able to react more quickly to an emergency. Defensive driving practices include being aware of what is happening around you—frequently check ahead, behind, and in your blind spots. Stay out of others’ blind spots if possible. Don’t follow too closely. Use the three-second rule: Note an inanimate object and count the seconds between when the vehicle ahead of you passes it and you do. A three-second gap enables you to stop in time if the vehicle ahead of you ahead stops suddenly.

Another key to safe driving is to stay focused when you’re behind the wheel. You know you shouldn’t talk or text while driving, but did you know that animated conversations among passengers, listening to or changing the radio station, and eating or drinking can also distract you from your driving? Do your best to keep your full attention on the road.

Never drive while impaired by alcohol or drugs (even some over-the-counter drugs can cause impairment). Designate a driver, or call a taxi or ride share service.

Safe drivers pay less for their auto insurance

Safe driving during the holidays—and all year long—can not only help protect you and your family from danger, it can help you save money on your auto insurance. If you need car insurance, or any other type of insurance, please call your friends at L & M Insurance Group (813-672-4100) or contact us online. L & M Insurance Group is an independent agency located in Riverview, Florida, serving Riverview, Brandon, Tampa, Valrico, and surrounding communities.

We wish you a safe and happy holiday season!

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Insurance 101: Understanding Your Deductibles

by Posted in Auto Insurance, Homeowners Insurance Tagged , , ,

The high cost of home and auto insurance in Florida has us all thinking about ways to save money on policy premiums. While many factors are beyond your control, one that may help save money is your policy deductible. Generally, a higher deductible means lower premiums. A lower deductible means your premiums will be higher. You’ll have to decide which makes better financial sense for your situation.

Let’s talk about what a deductible is, and how it works with your home and auto insurance.

What is a deductible?

A deductible is the amount of money you’ll pay out of pocket before your insurance takes over when you have a claim. When you have an insured loss, the deductible is subtracted (or “deducted”) from the amount of money your insurance company will pay to settle your claim. If you have a loss that doesn’t reach the amount of your deductible, you won’t be able to make a claim.

In home and auto insurance, there are two types of deductibles:

  1. A flat dollar amount. A $500 deductible on the comp/collision coverage of your auto policy is an example of this type of deductible.
  2. A percentage-based amount. This type of deductible is usually found on a homeowners policy. The percentage is calculated based on the home’s insured value. For example, you have a two percent deductible, and your home is insured for $500,000. If your home is destroyed, your deductible would be $10,000.

In hurricane-prone states such as Florida, a special hurricane deductible also applies only to damage and claims from storms categorized as hurricanes by the National Weather Service. Homeowners insurance companies decide on what will “trigger” the hurricane deductible—usually when the National Weather Service officially names a storm or declares a hurricane watch or warning. A hurricane deductible is usually between one and five percent of your home’s insured value.

With auto and homeowners insurance, your deductible applies each time you make a claim. An exception might be your hurricane deductible, which may only apply once per hurricane season. Check your insurance policy for details.

Insurance is intended to help you financially in the event of a loss that is too big for you to handle by yourself. It’s important to note that making frequent claims on your homeowners or car insurance will not only result in higher premiums—it may also get your policy cancelled or non-renewed.

What to consider before raising your deductible

While it’s tempting to raise your deductible to save money on your insurance, remember that you’ll be paying more out of pocket if you have a claim. Will you be able to make necessary repairs with a higher deductible? If you do raise your deductible, consider setting aside money to cover it if you have a loss.

Do you need home or auto insurance?

Helping you with your insurance needs, including helping you decide what deductible is right for you, is just what L & M Insurance Group is here for. L & M Insurance Group is a locally owned, independent insurance agency serving Tampa, Brandon, Riverview, Valrico, and surrounding communities. If you need a home or auto insurance policy, call (813) 672-4100 to speak to an agent, or contact us online.

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L & M Insurance Group Is Your Source for Affordable Commercial Auto Insurance in Florida

by Posted in Auto Insurance, Commercial Insurance Tagged , ,

Of all the many decisions Florida business owners have, choosing the right commercial insurance coverage is one of the most important. Without proper insurance protection, you could easily find yourself in serious financial trouble—you might even lose your business. L & M Insurance Group can help you with all your commercial insurance needs, but today we’re going to highlight commercial auto insurance.

Who needs commercial auto insurance?

Anyone who operates one or more vehicles in the course of doing business, or who owns or leases a vehicle for business use needs commercial auto insurance (also known as business auto insurance). All kinds of businesses need commercial auto insurance, including trucking and hauling services, taxi or limo services, moving companies, delivery services, repair services, locksmiths, landscaping companies, and day care or van services. You need a commercial auto policy if:

  • The vehicle is registered in the name of the business
  • You have permanently attached equipment or pull a trailer in relation to your work
  • You have a commercial license plate
  • You have a sign or advertising for the business on your vehicle
  • Employees drive the vehicle, or drive their own vehicles while working for your business
  • The vehicle is used to deliver packages or food
  • The vehicle is used to transport clients or other employees
  • You transport people for a fee, such as driving for Uber or Lyft

Don’t expect your personal auto policy to cover business use. Business use is almost always excluded under personal auto policies, and your insurance company could deny claims if they find you’re using your vehicle in your business. (If you still have questions about whether your usage qualifies as business use, please consult a commercial auto agent.)

A commercial auto insurance policy offers the same types of coverages as a personal auto policy, including liability (property damage, bodily injury, uninsured motorist) and comprehensive and collision. Commercial auto policies are designed to address the needs of the business owner, and whatever situations might arise from business use of a vehicle. The good news is that the cost of commercial insurance is often quite reasonable—and not always more expensive than a personal auto policy. The best thing to do is to discuss the types of coverage and limits you need with a commercial auto insurance agent, like one of the professionals at L & M Insurance Group.

How to get a commercial auto insurance quote

It’s simple! Just give L & M Insurance Group a call at 813-672-4100, or click here to contact us online. Our experienced agents will help you choose a commercial auto policy that suits your needs. Some info that will help us give you the most accurate quote includes:

  • How many vehicles you need to have insured
  • Who the drivers will be, and as much of their driving history as you know
  • How the vehicles are used
  • Whether or not you transport cargo or people
  • How many miles will be driven each year

Protect your business with a commercial auto policy

A commercial auto policy will help to protect your business—and you, personally—from financial loss stemming from the cost of an accident if you or one of your employees is at fault. L & M Insurance Group writes commercial auto insurance for both large and small businesses. We have more than 30 years’ experience serving the insurance needs of Riverview, Brandon, Valrico, Tampa, and surrounding communities. Please give us the chance to help you protect your business!

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Florida Home and Auto Premiums Are Skyrocketing—Is There Anything You Can Do?

by Posted in Auto Insurance, Homeowners Insurance, News Tagged , , , ,

Almost every day we receive calls or emails from upset clients whose insurance premiums are going up, even when they’ve never made a claim. Some policies are going up by hundreds of dollars per year—what is happening?

The Florida insurance market is in crisis, particularly the homeowners and auto insurance sectors. A perfect storm of factors is contributing to today’s skyrocketing premiums and a market in which it’s getting harder to find insurance at all. In addition to rate increases, insurance companies are pulling out of Florida and tightening their underwriting guidelines. Florida consumers are facing insurance premium sticker shock and are finding it harder and harder to get the insurance coverage they need at a price they can afford.

Why insurance premiums are skyrocketing

As a locally-owned, independent insurance agency, L & M Insurance Group is committed to helping you find insurance that fits your needs and that you can afford. We also want to help you understand the factors contributing to this crisis. Here are the main reasons Florida insurance is seeing such steep increases:

Catastrophic losses. In 2020, Florida insurers lost nearly $1.6 billion dollars, and are reporting even greater losses in 2021. These losses mainly stem from litigation and reinsurance costs (see below), as well as continued payouts for hurricanes Irma and Michael.

Reinsurance costs. It might seem odd that wildfires in California or Australia would affect the price of insurance in Florida, but they can. That’s because disasters all over the world affect the cost of reinsurance for everyone. Reinsurance is “insurance for insurers”—a way for insurance companies to limit the extent of their own losses in case of disaster. The cost of reinsurance has been rising, and experts expect it to continue going up.

Skyrocketing construction and repair expenses. With the price of everything from car parts to lumber going up, it costs more than it did in past years to repair your vehicle or rebuild your house in case of a loss.

In addition, the value of vehicles and homes is also going up, which means in order for you to receive replacement cost in case of a loss, your insurance company will have to pay out more. It follows that if a covered item is worth more, then the cost of insuring it will be more.

Labor shortages are also affecting the price of construction, home, and auto repair. (Read more about how supply chain issues and labor shortages are affecting car insurance premiums.)

Lawsuits and fraud. For years, bad actors have exploited both policyholders and property insurers. Homeowners have been talked into filing claims and lawsuits by third parties like attorneys, contractors, or water remediation firms. Often times, homeowners don’t understand the claims process, or are relieved to have someone else take over. Unfortunately, every insurance consumer in Florida is paying the price for inflated or fraudulent claims and lawsuits.

Florida has, by far, the largest number of lawsuits related to homeowners insurance claims. For instance, in 2019, only 8.15 percent of all homeowners claims in the U.S. were filed in Florida, but more than 76 percent of property claim lawsuits were filed here. And what’s worse: only eight percent of the fifteen billion dollars that property insurance companies paid out in claims costs between 2013 and 2020 went to consumers. Seventy-one percent went to attorneys!

What can you do?

Much of what is happening in the insurance industry is out of individuals’ control, but here are three things you can do:

Review your insurance needs with an L & M Insurance Group agent. We can help you make sure you have the appropriate coverage for your situation, and that you’re taking advantage of all discounts available to you. We can also discuss whether or not an option such as switching to a higher deductible to lower your insurance premium is right for you.

If you have a claim, be sure to contact your insurance agent and/or your insurance company yourself. Do not sign anything without talking to your insurance agent or directly to your insurance company.

Contact your elected officials and tell them that continued insurance reform is still needed. Though recent legislation has helped to reduce assignment of benefits lawsuits, other types of lawsuits are still going up, at a cost to all of us.

We at L & M Insurance Group understand your worries and frustrations about the cost of home and auto insurance. We promise we will do the best we can under these difficult circumstances to provide you with the best coverage at the most cost-effective price. Please call us at 813-672-4100 if you need to discuss your insurance options. If you prefer, you may also contact us online.

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Make These Insurance Resolutions for the New Year

by Posted in Auto Insurance, Commercial Insurance, Homeowners Insurance, Life Insurance, Uncategorized Tagged , , , , ,

At the start of a new year, many people resolve to get their finances in order. L & M Insurance Group would like to remind you that appropriate insurance coverage is one of the best ways you can protect yourself from financial disaster. Insurance can protect your most valuable assets, like your home and your vehicle, protect you from lawsuits, and even care for your family after you’re gone.

Here are a few things you can resolve to do now to make sure you have the financial protection you need—for the lowest possible insurance premiums.

Review your life changes. Was 2021 was an eventful year for you? Did you experience any major life changes, such as marriage, divorce, or the birth of a child? Did you renovate your house, buy a new vehicle, turn 55, or start a business? Become an empty nester? Even if you already notified your insurance agent about these changes, now is a good time to do a more thorough review of your insurance coverage to make sure you’re properly protected.

Review your coverage. Once you’ve reviewed your personal situation, you’ll want to see how it lines up with your insurance coverage. Insurance is meant to protect your financial assets in case of accident, crime, or disaster, including providing liability protection in case someone sues you. Some common areas of concern we see frequently include:

For auto insurance, do you carry bodily injury in high enough limits? (Insurance experts recommend 100,000/300,000 for most situations, even though Florida state requirements are much lower.) Do you carry uninsured motorist (UM) coverage? (In Florida, we have many un- or under-insured drivers on the roads, so we recommend carrying UM coverage.)

For home insurance, does your policy provide replacement cost coverage? Your home should be insured for enough to rebuild, repair, or replace it and your personal possessions with comparable quality—not just for how much you owe on your mortgage or the home’s market value.

And speaking of personal possessions, did you buy or receive any expensive items in 2021—such as jewelry, art, or home electronics? High value items may need special coverage, over and above what is covered under a standard homeowners insurance policy.

Consider your life insurance needs. Do you have life insurance? Do you need it? If you do have life insurance, be sure that your policy is up to date with the correct beneficiary, and any other details that may have changed. Life insurance is surprisingly affordable, especially for younger people who are most in need of it to help safeguard their families’ futures. If you don’t have life insurance but would like to explore your options, please call 813-672-4100, or click here for an online quote.

Keep your driving record clean. Still one of the most basic things you can do to keep your auto insurance rates down!

Maintain or improve your credit record. Many insurance companies look at your credit when calculating insurance premiums. Boosting your credit record can result in cheaper insurance rates and more policy options to choose from. (Even if your credit is not great, L & M Insurance Group can still help. Give us a call at 813-672-4100.)

Work with an independent agency. Independent agencies, like L & M Insurance Group, represent multiple insurance carriers instead of just one. This means we have more flexibility to shop for the best policy and insurance company for your individual situation. We can also write just about any type of insurance you need, including personal and commercial auto, home, life, renters, and business insurance. And OUR number one new year’s resolution is to help YOU find the best insurance deal! Give us a call at 813-672-4100, or contact us online for all your insurance needs.

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Can Supply Chain Problems Affect Your Car Insurance?

by Posted in Auto Insurance Tagged , ,

Florida drivers already pay some of the highest car insurance rates in the nation, and those rates are likely to go up in the near future. Why? Because insurance companies’ claims costs are skyrocketing, and strange though it may seem, supply chain and other pandemic-driven causes are contributing.

Shortages and supply chain issues

Because of pandemic-fueled, industry-wide shortages of raw materials and parts to build vehicles (including semi-conductor chips), there are fewer new vehicles in showrooms. This has caused the cost of both new and used vehicles to rise. Insurance companies use the value of the vehicle when calculating rates for comprehensive and collision coverage. They also use vehicle value to determine how much to pay out when a vehicle has been in a crash and is declared a total loss. Since both new and used car prices are going up, so are premiums and claim payments.

Claims costs are also rising because the cost of parts has gone up, and it’s taking longer to repair damaged vehicles because of shortages of both car parts and qualified auto mechanics. At least one of our companies has reported that they have had to total out vehicles because they can’t find parts to repair them.

And one more thing—when it takes longer to repair a damaged vehicle, the cost of a replacement rental car also goes up since the client needs the rental car for a longer time.

What you can do

Unfortunately, you can’t do much about supply chain issues. But the best thing you can do is minimize your risk of an accident or moving violation (which will also raise your auto insurance premiums) by driving defensively. Don’t drive distracted or while impaired, obey speed limits, and wear your seat belt. And be sure to check in with an L & M Insurance Group agent to help you shop for the best car insurance rate for your situation. L & M Insurance Group is a local, independent insurance agency, and we partner with many quality insurance companies. Please call 813-672-4100 if you’d like a no-obligation quote, or contact us online.

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Don’t Forget This Tip for Keeping Car Insurance Premiums Down

by Posted in Auto Insurance Tagged , , ,

Many factors determine what you’ll pay for car insurance—things like how expensive your vehicle is, how old you are, and how good your credit is. But don’t forget one of the most important rating factors if you want the cheapest car insurance: keeping your driving record clean!

Driving safely in Florida can keep your Car Insurance Premiums Down

While driving safely may seem like common sense, it doesn’t hurt to be reminded of basic defensive driving principles. Driving safely helps you avoid costly tickets which raise your insurance rates—and it also helps you—and your passengers—stay safe from auto accidents.

Now that kids are back in school there may be more traffic, and thus more distractions, on the road. We’re also still in our summer weather pattern and may face driving through heavy rainstorms. Florida drivers, who pay some of the most expensive car insurance premiums in the U.S., need all the help they can get. Here are some tips from the Florida Department of Motor Vehicles that could keep you from getting a ticket and/or being in a car accident and seeing your car insurance rates rise because of it.

Drive defensively. This means being constantly aware of what is happening around you.

  • Are there children playing next to the road, and could they run out into the street?
  • Is someone backing out of a driveway up ahead?
  • If it’s raining, do you have your wipers and lights on, and are you slowing down if necessary?
  • Are you following the vehicle ahead of you too closely?

Defensive drivers do everything they can to watch for danger and avoid a crash.

Avoid bad drivers. If you see someone tailgating, failing to signal, speeding, swerving, or changing lanes unexpectedly, back off! Their distraction could cause an accident—and even if it’s not your fault, you don’t want to be caught up in a situation like that.

Never drink and drive. It’s just not worth it. Aside from the danger to yourself and others, if you drive while impaired and are cited for DUI, expect your car insurance to skyrocket.

Focus on the road. Don’t talk or text on your cell phone, adjust the radio, eat or drink, or turn to look at others in the car while you’re driving. Pull over and stop if you must do any of these things.

Don’t drive aggressively. Aggressive drivers often cause accidents. If you find yourself yelling at other drivers, speeding up so that other drivers can’t merge in front of you, or tailgating, you might be an aggressive driver! And if another driver makes you angry, let it go. Report a dangerous driver to the police—don’t try to “teach them a lesson.”  

L & M Insurance Group—your source for car insurance

While it’s true that good drivers will pay less for their car insurance, L & M Insurance Group can still help you find an auto insurance policy if your driving record isn’t perfect. Because we are an independent insurance agency, we write with many different car insurance companies. Whether you have a clean driving record or violations, good credit or bad credit, PIP claims, or if you need an SR-22 or FR-44—we have a partner company who will write your business. Give us a call at 813-672-4100 or click here for a car insurance quote.

Need a commercial auto policy? L & M Insurance Group writes commercial auto policies for every type of business! Call us today at 813-672-4100.

For more information on safe driving:

The Florida Department of Highway Safety and Motor Vehicles

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Are You Paying Too Much for Your Car Insurance?

by Posted in Auto Insurance Tagged , , Leave a comment

Even though many insurers offered pandemic discounts during 2020, car insurance rates in Florida continue to be some of the costliest in the U.S.  You may wonder how insurance companies decide what to charge, anyway—and if there’s anything you can do to pay less for your car insurance. Aside from your driving record, here are six things that could be affecting your car insurance premiums. While some of them are common sense, you might be surprised by what factors insurance companies use to set their rates.

Your vehicle

Not only does the value of your vehicle influence the price of your car insurance, if your vehicle is popular with car thieves, it costs more than the average to repair, or has a poor safety record, you could be paying more for your car insurance.

Where you live

If you live in an area with an above-average crime rate, you’ll likely pay more.

Your commute

The farther you drive to and from work each day affects your insurance rate, because insurance companies figure the more time you spend on the road, the more likely you’ll be in an accident—whether you’re at fault or not.

Your credit record

Insurance companies have found a link between poor credit and increased insurance losses.

Your age

Younger drivers with less experience are more likely to be involved in an accident.

Your discounts

Different companies offer different types of discounts, but some of the most common include safe driver, low mileage, good student, vehicle safety features, claim-free, prior coverage, homeowner, and multi-car or multi-policy discounts.

Of course, we think the best way to make sure you’re not paying too much for your car insurance is to give L & M Insurance Group a chance to quote your policy—we write with many great insurance companies, both standard and non-standard, and we’d love the chance to earn your business!

If you haven’t shopped around for a better auto insurance rate recently, it’s time to do so.

Let L & M Insurance Group do the comparison shopping for you! Since we represent so many insurance companies, we can find the best rate for your situation, whether you have good credit, bad credit, a clean driving record or one that’s not so stellar. We also have companies that will write your policy if you’ve had a PIP claim, you need an FR-44 or an SR-22. Please call us at 813-672-4100, or click here for an auto insurance quote.

L & M Insurance Group is an independent insurance agency serving Riverview, Brandon, Valrico, Lithia, and surrounding communities in the Tampa Bay area. We have more than 30 years in the insurance business, and our agents are experts in personal insurance, business insurance, Medicare insurance, and Life insurance.

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Insurance 101: Terms You Should Know

by Posted in Auto Insurance, Homeowners Insurance, Uncategorized Tagged , , Leave a comment

Just like any specialized industry, insurance has its own vocabulary. When you’re shopping for a new policy—or trying to make sense of the policy you already have—it helps to understand some of the most commonly used insurance terms. Plus, understanding these terms can also help you get the best insurance rate. How? Because understanding a few key terms will help you compare policies accurately, buy the coverage you need, and even help determine how much money you’ll receive if you make a claim!

General terms

There are a few general terms that apply to several different types of insurance. For instance, you probably know that a deductible is the amount you’ll pay out of pocket before your insurance kicks in. An endorsement (also known as “rider”) is an amendment to the insurance policy that changes its coverage, terms, or conditions. Some examples of endorsements include a change of address when you move, adding or removing a vehicle or driver on an existing auto policy, or adding coverage for sewer backup to a homeowners insurance policy.

Homeowners insurance terms

One of the most important sets of terms you should know is actual cash value versus replacement cost. These terms are most often found in a homeowners insurance policy.

Actual cash value refers to the amount you would be reimbursed for replacing damaged or destroyed property with comparable new property, minus depreciation. Replacement cost is the amount needed to replace damaged or destroyed property or personal belongings without deducting for depreciation, up to the policy limit. If you make a claim thinking you have replacement cost but you actually have actual cash value, you could receive thousands of dollars less than you expect.

Car insurance terms

Occasionally, clients become confused about the different types of injury and liability coverage available in a car insurance policy.

Some states, including Florida, are no-fault states, meaning that drivers must carry insurance for their own injuries, regardless of who is at fault in an accident. This coverage is called personal injury protection (PIP). It covers both the named insured and his or her passengers.

Property damage pays for damage you cause to another vehicle if you’re at fault in an accident.

Bodily injury refers to coverage for injuries you cause in an at-fault accident.

Uninsured motorist pays for your injuries (once you have used up your PIP) if you’re hit by a driver who does not have bodily injury liability insurance or is underinsured.

Still have questions?

These are just a few of the more commonly asked-about insurance terms. There are many more. If you still have questions, don’t be afraid to ask your agent to explain. Personal service is one of the prime benefits of working with an independent insurance agency like L & M Insurance Group. Please give us a call at 813-672-4100 if you have questions about your policy. Please click here for a car insurance quote, or here for a homeowners insurance quote.