I work on quotes for teenage drivers all the time. Parents are typically shocked the first time they have to insure a teenaged driver. Typically their rates go way up. Why? Because teenage drivers are the most likely to get involved in traffic accidents! If you're a great child, you might ask yourself, "How can I keep the costs of insuring me as low as possible?" Here's what you can do to get great rates from State Farm.
1. Be a good student. If you maintain a 3.0 or better grade point average, you'll qualify for a Good Student Discount. All you have to do is bring in or fax us a copy of your report card at the end of every semester (high school and college).
2. Go to www.statefarm.com and watch the Steer Clear videos. Fill out the driving log and get the Steer Clear discount.
3. Don't get any traffic tickets. This means don't speed, don't speed, don't speed! When on the highway, don't use the passing lane.
4. Don't get in any accidents. I've had two sixteen year olds get into fender-benders right after getting their licenses. Stop - fully stop - at all stop signs and lights. Be extra-careful turning right on red. Look all aorund you before making a left turn at an intersection.
Why is this so important? Having a good student discount and a steer clear discount can save you a hundred dollars a month! Getting in an accident can raise your rates a couple of hundred dollars a month! So, be careful out there.
Sunday, February 1, 2009
Sunday, January 18, 2009
PLUPs and why they are so important
Right around Christmas-time one of my policyholders came into the office, visibly shaken. She handed me a letter, which I proceeded to read. Two years ago she was in an accident with a motorcycle in which she was determined to be at fault. My company paid to replace the motorcycle. The letter she handed me was from a personal injury attorney.
The attorney claims that two years after the accident the driver of the motorcycle, now in his mid-twenties, is no longer able to enjoy his life. They will establish compensatory and punitive damages in court. My client is worried that she will have to sell her house, which she owns outright, to settle the case.
Her policy coverages had been 100/300/100, which is far above Washington's state minimums. What these numbers mean that if she is found liable in an accident, she is covered for up to $100,000 in injuries per person, with a maximum of $300,000 per accident, and up to $100,000 in property damage (damage to the other vehicle(s) in the accident). So let's say that the motorcycle driver had had $50,000 in hospital expenses after the accident, which my company paid. Our client is covered for up to $50,000 more. What if he claims that losing the ability to enjoy his life is worth $500,000? My company would pay for the first $50,000, and my client will be responsible for the other $450,000.
How could she pay that? She owns her house free and clear, and it is worth about $500,000. She has other assets that add up to less than $200,000. If she loses the lawsuit, she will have to sell her house and then find a place to rent that she can afford.
How could this have been avoided? If she had purchased a Personal Liability Umbrella Protection (PLUP), she could have been protected. In my company's case, she would have had to raise her auto coverages to 250/500/100, and then added a $1 million PLUP. This would have cost her around $200 per year more than her existing coverage. But it would have provided her with $1 million in coverage over her auto limits. Just as importantly, this coverage includes the cost of defending her in court.
And herein lies part of the difficulty of being an insurance agent. I try to advise all of my clients about the coverages they have, the risks that they are exposing themselves to, and what their options are. Sometimes people think I am trying to oversell them. You would be amazed at how may people with significant assets insist on having the minimum coverages required by our state. In the state of Washington, that means 25/50/10, or $25,000 per person, a maximum of $50,000 per accident, and just $10,000 in property damage. Take a look around the next time you are on the road. How many cars do you see that would cost more than $10,000 to replace? That is a huge risk!
When I write new business, I start with 100/300/100 coverage, and I explain to each client the risk involved with having lower coverages. Then I ask about their financial health. If they have significant assets and/or a high-paying job, then we talk about raising those limits and adding a PLUP. I offer to review coverages with each of my clients every year. You'd be surprised how few people accept the offer. As my clients age, we discuss their home equity as part of the asset base they need to cover. I educate them on PLUP coverage and let them decide whether that is coverage they would like to have.
A recent article on the web about insurance called PLUP coverage the industry's best-kept secret. Make sure you discuss it with your agent. If you live in the state of Washington and would like to discuss your coverages with me, go to my personal website at www.kelllymeldrum.com for my contact information and call me to set up an appointment! It's a free service I am happy to offer.
The attorney claims that two years after the accident the driver of the motorcycle, now in his mid-twenties, is no longer able to enjoy his life. They will establish compensatory and punitive damages in court. My client is worried that she will have to sell her house, which she owns outright, to settle the case.
Her policy coverages had been 100/300/100, which is far above Washington's state minimums. What these numbers mean that if she is found liable in an accident, she is covered for up to $100,000 in injuries per person, with a maximum of $300,000 per accident, and up to $100,000 in property damage (damage to the other vehicle(s) in the accident). So let's say that the motorcycle driver had had $50,000 in hospital expenses after the accident, which my company paid. Our client is covered for up to $50,000 more. What if he claims that losing the ability to enjoy his life is worth $500,000? My company would pay for the first $50,000, and my client will be responsible for the other $450,000.
How could she pay that? She owns her house free and clear, and it is worth about $500,000. She has other assets that add up to less than $200,000. If she loses the lawsuit, she will have to sell her house and then find a place to rent that she can afford.
How could this have been avoided? If she had purchased a Personal Liability Umbrella Protection (PLUP), she could have been protected. In my company's case, she would have had to raise her auto coverages to 250/500/100, and then added a $1 million PLUP. This would have cost her around $200 per year more than her existing coverage. But it would have provided her with $1 million in coverage over her auto limits. Just as importantly, this coverage includes the cost of defending her in court.
And herein lies part of the difficulty of being an insurance agent. I try to advise all of my clients about the coverages they have, the risks that they are exposing themselves to, and what their options are. Sometimes people think I am trying to oversell them. You would be amazed at how may people with significant assets insist on having the minimum coverages required by our state. In the state of Washington, that means 25/50/10, or $25,000 per person, a maximum of $50,000 per accident, and just $10,000 in property damage. Take a look around the next time you are on the road. How many cars do you see that would cost more than $10,000 to replace? That is a huge risk!
When I write new business, I start with 100/300/100 coverage, and I explain to each client the risk involved with having lower coverages. Then I ask about their financial health. If they have significant assets and/or a high-paying job, then we talk about raising those limits and adding a PLUP. I offer to review coverages with each of my clients every year. You'd be surprised how few people accept the offer. As my clients age, we discuss their home equity as part of the asset base they need to cover. I educate them on PLUP coverage and let them decide whether that is coverage they would like to have.
A recent article on the web about insurance called PLUP coverage the industry's best-kept secret. Make sure you discuss it with your agent. If you live in the state of Washington and would like to discuss your coverages with me, go to my personal website at www.kelllymeldrum.com for my contact information and call me to set up an appointment! It's a free service I am happy to offer.
Thursday, October 30, 2008
This Is How Thursdays Start
Today started like most of my Thursdays. I got out of bed early, at about 6:00 a.m., and went downstairs to work out. I did about a half-hour on the elliptical machine. I have a Tivo and a television set near the elliptical machine, and this morning I watched "Poker After Dark." I like watching poker shows to see the strategies the players use.
My husband, Rob, and I get together about once a month with three other couples and we have a gourmet dinner followed by a spirited game of No Limit Texas Hold 'Em. It's always a lot of fun, and it's amazing how good we all have gotten.
I'm a State Farm agent and I own an agency in Edmonds, Washington. My office is located at 8226 212th Street, in an area known as 5 Corners because five streets intersect about a hundred yards from my office. My first agency was in Cincinnati, Ohio, and nearly fifteen years ago I went into management with State Farm. In 1998 I was promoted and moved out to Greater Seattle as an Agency Field Executive. I fell in love with the area and four years ago I moved back into agency in order to stay in the area.
Edmonds is a great little town just north of Seattle, located on the Puget Sound. The people here are wonderful, and Rob and I love going for walks along the beach when the tide is out. Our cat, Maggie, is a beautiful tortoise-shell calico and I have trained her to do several tricks. Later on I'll post some pictures of Maggie, our house, and the area. Since I'm new to blogging, I'm going to stop writing now so I can see how this all turned out!
My husband, Rob, and I get together about once a month with three other couples and we have a gourmet dinner followed by a spirited game of No Limit Texas Hold 'Em. It's always a lot of fun, and it's amazing how good we all have gotten.
I'm a State Farm agent and I own an agency in Edmonds, Washington. My office is located at 8226 212th Street, in an area known as 5 Corners because five streets intersect about a hundred yards from my office. My first agency was in Cincinnati, Ohio, and nearly fifteen years ago I went into management with State Farm. In 1998 I was promoted and moved out to Greater Seattle as an Agency Field Executive. I fell in love with the area and four years ago I moved back into agency in order to stay in the area.
Edmonds is a great little town just north of Seattle, located on the Puget Sound. The people here are wonderful, and Rob and I love going for walks along the beach when the tide is out. Our cat, Maggie, is a beautiful tortoise-shell calico and I have trained her to do several tricks. Later on I'll post some pictures of Maggie, our house, and the area. Since I'm new to blogging, I'm going to stop writing now so I can see how this all turned out!
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