Many insurance companies use the Texas Personal Automobile Policy, a standardized policy form that offers eight types of coverages. Companies may sell other policies if the Texas Department of Insurance (TDI) has approved the policies…

Read your policy carefully because coverages can vary.  Pay special attention to the exclusions section, which lists the things your policy doesn’t cover. The front page of your policy – called the declarations, or dec, page – shows the exact name of your insurance company, your policy number, and the amount of each of your coverages and deductibles.

Following is a summary of the eight coverages in the Texas Personal Automobile Policy. Although your coverages and policy terms may be different from these, this summary can help you understand the coverages.

1. Liability Coverage (Basic liability coverage meets the state’s financial responsibility requirement.)

What it pays: The following expenses, up to your policy’s dollar limits, for the people in the other car involved in an accident you, or someone covered by your policy, caused:

• medical and funeral costs, lost wages, and compensation for pain and suffering
• car repair or replacement costs
• car rental while the other driver’s car is being repaired
• punitive damages awarded by a court.

Liability insurance also pays your attorney fees if someone sues you because of the accident.  If you are arrested following an accident, liability insurance will pay up to $250 for bail.

Who it covers:

• you and your family members. (Family members include anyone living in your home related to you by blood, marriage, or adoption.  This includes your spouse, children, in-laws, adopted children, wards, and foster children.)
• other people driving your car with your permission
• family members attending school away from home
• spouses living elsewhere during a martial separation might be covered.

You and your family members might be covered when driving someone else’s car – including a rental car – but not a car that you don’t own but have regular access to, such as a company car

Note: Some policies won’t cover other people, including family members, unless they’re specifically named in the policy. Your policy’s declarations page should list the names of all of the people covered by the policy.

2. Collision (damage to your car) Coverage

If you still owe money on your car, your lender will require you to have collision and comprehensive coverages.

What it pays: The cost of repairing or replacing your car after an accident. You will only receive the amount of your car’s actual cash value, minus your deductible. Actual cash value is the market value of a car like yours without damages.

Who it covers: You, your family members, passengers in your car, and others driving your car with your permission.

3. Comprehensive (physical damage other than collision) Coverage

If you still owe money on your car, your lender will require you to have collision and comprehensive coverage.

What it pays: The cost of replacing or repairing your car if it is stolen or damaged by fire, vandalism, hail, or an event other than a collision. Comprehensive coverage also pays for a rental car or other temporary transportation if your car is stolen. Your policy won’t pay for an auto theft unless you report it to police.

Payment is limited to your car’s actual cash value, minus your deductible.

4. Medical Payments Coverage

What it pays: Your medical and funeral bills resulting from accidents, including an accident involving a pedestrian or bicyclist.

Who it covers: You, your family members, and passengers in your car, regardless of who caused the accident.

5. Personal Injury Protection (PIP) Coverage

What it pays: Same as medical payments coverage, plus 80 percent of lost income and the cost of hiring a caregiver for an injured person.

Who it covers: You, your family members, and passengers in your car, regardless of who caused the accident.

An insurance company must offer you $2,500 in PIP, but you can buy more. If you don’t want PIP, you must reject it in writing.

6. Uninsured/Underinsured Motorist (UM/UIM) Coverage

What it pays: Your expenses from an accident caused by an uninsured motorist or a motorist who did not have enough insurance to cover your bills, up to your policy’s dollar limits. Also pays for accidents caused by a hit-and-run driver if you promptly reported the accident to police.

There is an automatic $250 deductible, which means you must pay the first $250 of the expenses yourself before the company will begin to pay.

There are two types of UM/UIM coverage:

• Bodily injury UM/UIM pays for medical bills, lost wages, pain and suffering, disfigurement, and permanent or partial disability. There is not a deductible with this type.
• Property damage UM/UIM pays for auto repairs, a rental car, and damage to items in your car.

Who it covers: You, your family members, passengers in your car, and others driving your car with your permission.

Insurance companies must offer UM/UIM coverage. If you don’t want it, you must reject it in writing.

7. Towing and Labor Coverage

What it pays: Towing charges when your car can’t be driven. Also pays labor charges, such as changing a tire on the side of the street.

8. Rental Reimbursement Coverage

What it pays: A set daily amount for a rental car if your car is stolen or is being repaired. Your company only pays for repairs that were caused by an event that your policy covers.

Other Coverages   

You may buy other coverages for an additional premium to cover items in your car, new or additional cars, rental cars, or driving in Mexico.

Stereo Equipment

Your policy won’t pay for CDs, MP3 players, cell phones, citizen band radios, or stereo equipment not installed in your car.

New or Additional Cars

If you buy another car, your policy might automatically cover it with certain limitations. Read your policy or ask your agent to find out if you have this coverage.

Insurance companies usually give additional cars the same amount of coverage as your car with the most coverage. For example, if you have two cars – one with liability coverage only and one with liability, collision, and comprehensive coverages – and you buy a third car, the third car will automatically have liability, collision, and comprehensive coverage.

A replacement car usually has the same coverage as the car it replaced. For example, if you trade in an older car that only had liability coverage,  the new car will automatically have only liability coverage.

Be sure to tell your insurance company as soon as possible that you have added or replaced a car and which coverages you want. You could lose coverage on an additional or replacement car if you wait longer than the number of days specified in your policy to notify your insurance company.

Rental Cars

Rental car agencies offer collision damage waivers and liability policies. The collision damage waiver is not insurance. It is an agreement that the rental company will not, with certain exceptions, try to make you pay for any damage to a car you rent.

If you have auto insurance, your policy may already cover damage to a rental car. Your coverage limit, however, might be less than the value of a rental car. Read your policy to know what’s covered and the coverage limits. If your coverage limit is too low, consider increasing it. You will pay more in premium, but it might be cheaper than buying additional coverage through the rental agency, especially if you rent cars often.

If you don’t own a car, but borrow or rent cars often, you can buy a non-owner liability policy. A non-owner policy pays for damages and injuries you cause when driving a borrowed or rented car, but it does not pay for your injuries or damage to the car you are driving.

Driving in Other States, Canada, and Mexico      

Your insurance should cover you if you drive in other U.S. states and Canada. Your policy will not cover you in Mexico because Mexico does not recognize U.S. auto liability policies.

Mexican authorities may hold drivers criminally and financially responsible for any auto accidents they cause. If you’re in an accident that results in an injury, police may keep you until they determine who is at fault. You will be asked to show you have insurance the Mexican government will accept or prove that you can pay any judgment against you.

Some U.S. insurance companies provide a free endorsement for your policy that covers occasional trips of up to 10 days and up to 25 miles into Mexico. You can buy coverage for longer stays, but it usually only covers you within 25 miles of the border. These endorsements might not meet Mexican legal requirements.

Some companies sell a Mexico tourist endorsement to attach to your Texas policy. This endorsement extends your liability coverage to pay costs exceeding a Mexican liability policy’s limits. It covers trips of any distance and any length of time. Ask your agent which endorsements your insurance company offers.

You may also buy Mexican liability insurance from authorized Texas agents. Check your phone book for listings of insurance agents who specialize in auto insurance for travel in Mexico. Your local agent also might be able to help you find coverage with a Texas-licensed Mexican company.

Auto Insurance for Young Drivers    

Parents can usually add their children to their auto policy to meet the state’s financial responsibility requirements. Adding a young driver to their parents’ policy can be expensive, but it’s cheaper than buying a separate policy.

Some policies require all covered drivers to be named on the policy. Be sure to call the company to tell them about new drivers as soon as they reach driving age. If you don’t have all of the drivers in your family listed on your policy and the company learns about them later – because of an accident claim, for instance – the company may bill you for the extra premium you should have paid, deny your claim and coverage, or refuse to renew your policy in the future.

Generally, if a teenager is the main driver of a particular car, the company will base the teen’s rate on that car. Otherwise, the company will base the teenager’s rate on the car in the family (usually the most expensive) with the highest rate.

Children Away at School or Not Living with You

You may want to take your children off your policy when they move out. You’ll probably have to prove to the insurance company that your child has moved. You can use documents like a driver’s license, lease agreement, or utility receipts to show that your child has a different address.

It’s probably not a good idea to remove children from your policy if they are living in another city and going to school. It’s risky to drop coverage if your teenager might occasionally drive at school or when home on visits. Many insurance companies will require you to keep students on your policy, even if you would like to remove them.

If you have children living in another city and going to school, tell your insurance company. Companies base rates on where a car is usually located, and it might need to adjust your premium. If the school is in another state, check on the financial responsibility laws in that state to make sure you have the right coverages.

If your child is away at school without a car, you might be eligible for a premium discount. Ask your agent if the company offers the discount.

Saving Money on Insurance for Young Drivers

Some insurance companies give a discount for teenagers who complete a Texas Department of Public Safety (DPS)-approved driver education course.  Drivers taught by their parents may also get the discount if the parent used a DPS-approved course. Some companies offer discounts to young drivers who make good grades in school or who belong to certain youth groups. Ask your agent about discounts.

Shopping for Auto Insurance      

Rates vary among companies, so it pays to shop around. The following tips can help you find the best deal for your money:

• Decide before shopping what coverages you need.
• Consider choosing a higher deductible. The deductible is the amount you must pay before the insurance company will pay. Higher deductibles will lower your premium, but you’ll have to pay more out of your own pocket if you have a claim.
• Get price quotes from several companies. Make sure the quotes are for the same coverages.
• When getting a price quote or applying for insurance, answer questions truthfully. Wrong information could result in an incorrect price quote or could lead to a denial or cancellation of coverage.
• Ask your agent if you qualify for any discounts the company offers.
• Consider factors other than price, including a company’s financial rating, complaint index, and license status. The financial rating indicates a company’s financial strength and stability, and the complaint index is an indication of its customer service. Buy only from licensed companies and agents. It is against the law to sell insurance without a license in Texas. You can also use the Shopping for Auto Insurance Company/Policy Comparison Worksheetto help you gather information about companies and the policies they offer.
• You can learn more about a company, including its license status, complaint history, and financial rating from an independent rating organization, by calling TDI’s Consumer Help Line or by visiting our website
  1-800-252-3439
  463-6515 in Austin
  www.tdi.state.tx.us

Understanding Rates      

Texas law requires insurance rates to be reasonable, adequate, not discriminatory, and not excessive to the risks for which they apply. Auto insurance companies in Texas set their own rates and file them with TDI for review. Companies do not have to receive prior approval before using their rates. However, TDI can order a company to make refunds if it determines that a company’s filed rates are excessive.

Factors that Affect Your Premium

Companies use a process called underwriting to decide whether to sell you a policy and what rate to charge you.  Companies must file their underwriting guidelines with TDI and update them each time they make a change. The criteria companies typically use to establish premiums include:

• Your age and, for younger drivers, your marital status. Male drivers under 25 and unmarried women under 21 have the highest rates. Drivers over 50 may get discounts.
• Your driving record and claims history.A good driving record can save you money.
• Where you keep your car.Because drivers in urban areas have more accidents and auto thefts, their rates are typically higher than the rates for drivers in rural areas.
• Your car’s type.Collision and comprehensive rates are highest for luxury, high-performance, and sports cars. Rates may also be higher for cars that damage easily or cost more to repair.
• Your car’s primary use.Rates for cars driven solely for pleasure are lower than rates for cars driven to and from work or used for business.
• Your credit score.Some companies will use your credit score to decide if they want to sell you a policy and what they’ll charge.
• Whether you drove uninsured in Texas. Companies may charge more if you drove uninsured in Texas for more than 30 days in the 12 months before you applied for insurance. If you didn’t, a company cannot charge you more for liability coverage because of your prior lack of coverage.

Discounts

Discounts can help you save money on your premium. Discounts vary by company. The following is a list of some of the ways you could receive a discount:

• defensive driving courses
• driver education courses for young drivers
• students with good grades
• parent or family whose young driver is away at school without a car
• two or more cars on a policy
• policy renewal with good claims and driving records
• a concurrent homeowners policy.

Your might also qualify for a discount if your car has:

• airbags and automatic seatbelts
• automatic daytime running lights
• antilock brakes
• antitheft devices.

Auto Insurance for ‘High-Risk’ Drivers      

Before writing or renewing a policy, insurance companies try to determine whether you’re likely to cause an accident.  They’ll check your driving history, insurance claims history, and sometimes your credit score.

If you have accidents or tickets on your driving record, you’ll probably be classified as a high-risk driver and will have to pay more for insurance. Companies may add surcharges to your premium – some as high as 60 percent – for the following:

• accidents (the more accidents, the higher the surcharge)
• tickets for moving violations (speeding, etc.)
• involuntary manslaughter
• driving under the influence
• criminally negligent driving
• driving without a license or with a suspended license.

Some surcharges are mandatory and will apply to your premium for three years.

Companies may also consider your credit score when deciding whether to sell you a policy and at what cost. A company cannot refuse to sell you a policy or cancel or nonrenew your policy solely based on your credit. Visit the Learning Center on TDI’s HelpInsure.com website to find out which companies use credit scores and how they use them.

Many companies use the Comprehensive Loss Underwriting Exchange (CLUE) to learn an applicant’s insurance claims history. Federal law allows you to request one free copy of your auto and personal property report every year. You can obtain your free reports by calling LexisNexis Personal Reports or by visiting its website

1-866-527-2600
https://personalreports.lexisnexis.com/index.jsp

Keep shopping if you’re having trouble finding insurance because you have tickets, accidents, or poor credit. Each company has its own criteria for deciding whether to insure people. Several major insurance company groups write coverage for high-risk drivers through one of their member companies.

TAIPA

If you can’t find a company willing to sell you a policy, you may be able to get basic liability coverage through the Texas Automobile Insurance Plan Association (TAIPA). You qualify for TAIPA coverage if two insurance companies refuse to insure you.

TAIPA only offers liability, PIP, and UM/UIM coverages. It doesn’t provide collision or comprehensive coverage or higher liability limits than the law requires. You must reject PIP and UM/UIM coverages in writing if you don’t want them.

TAIPA insurance is more expensive than insurance from most companies. TAIPA also charges surcharges for traffic tickets. Surcharges for accidents are also higher than in the traditional market.

TDI rules encourage insurance companies to take policyholders out of TAIPA and insure them at lower rates after a year without tickets or accidents. The rules also require companies to offer cheaper voluntary policies to their TAIPA policyholders who have gone three years without tickets or accidents.

To get TAIPA coverage, apply with a licensed insurance agent (not TAIPA). Only agents specifically certified by TAIPA may sell insurance through TAIPA. An agent who quotes you a premium higher than TAIPA’s must tell you about TAIPA if you were previously uninsured and had no more than one accident and one ticket in the previous three years.

Losing Your Insurance      

Companies may cancel or nonrenew a policy for a variety of reasons. Cancellation means the company terminates your policy before its expiration date. Nonrenewal means the company refuses to renew your policy when it expires.

A company must explain in writing its reasons for declining, canceling, or not renewing your policy. This explanation must include the incident or risk factor that violated the company’s underwriting guidelines and the insurance company’s sources of information.

Canceling a Policy

An insurance company may not cancel an auto policy that has been in effect for more than 60 days unless

• you fail to pay your premium
• you file a fraudulent claim
• your driver’s license or car registration are suspended or revoked (this also applies to other drivers who live with you or use your car).

During the first 60 days you have a policy, a company may cancel it for any lawful reason, including a ticket or an accident. If the company cancels your policy because of an accident, it still must pay for covered damages resulting from the accident. The company must send you a written notice at least 10 days before canceling your policy.

If either you or the company cancels your policy, the company must refund you any unearned premium. Unearned premium is the amount you paid in advance that did not actually buy coverage. For example, if you paid a six-month premium of $600 and you cancel your policy after one month, the company owes you $500 in unearned premium, minus any applicable agent or policy fees.

Not Renewing a Policy

A company cannot refuse to renew your policy unless it has been in effect for at least 12 months. This means a company must renew a six-month policy to give you a full 12 months of coverage. The company must give you 30 days’ notice before refusing to renew your policy.

In Texas, a company cannot refuse to renew your policy because of

• weather-related claims, including damage from hail, floods, tornadoes, high winds, and hurricanes
• damage from hitting animals or birds
• damage from gravel and other flying and falling objects (the company can raise your deductible if you have three of these claims in 36 months)
• towing and labor claims (the company can refuse to renew your towing and labor coverage if you have four of these claims in 36 months)
• other claims or accidents that cannot reasonably be blamed on you, unless you have more than one of these claims in 12 months.

Sometimes an insurance company will move you to another company in its company group. If it moves you, it must give you 30 days’ notice that it will not renew your original policy. ITDI can require the company to renew your policy for another year if it doesn’t give you notice.

If you get a nonrenewal or cancellation notice, start shopping for new insurance immediately. Make sure you keep your liability coverage uninterrupted to satisfy Texas’ financial responsibility laws.

If you still owe money on your car, your lender will usually require you to maintain collision and comprehensive coverages. If you cancel or lose these coverages, your lender will buy single-interest automobile physical damage coverage and add the cost to your loan payment. This coverage is expensive and protects only the lender.

Your Rights against Unfair Discrimination

An insurance company cannot deny, refuse to renew, limit, or charge more for coverage because of your race, color, religion, or national origin.

A company also cannot deny, refuse to renew, limit, or charge more for coverage because of your age, gender, marital status, geographic location, disability, or partial disability unless the refusal, limitation, or higher rate is based on sound underwriting or actuarial principles. This means the company would have to show valid evidence that you present a greater risk for a loss than other people it is willing to insure. A company cannot nonrenew your policy because someone in your family has reached driving age.

In addition, a company cannot discriminate between individuals of the same rate or risk class in its rates, policy terms, benefits, or in any other manner unless the refusal, limitation, or higher rate is based on sound actuarial principles.

You may sue insurance companies for unfair discrimination, including denial of insurance. You must file the suit in a Travis County district court. However, if the court finds the suit groundless, in bad faith, or brought for the purpose of harassment, the court could order you to pay the insurance company’s legal expenses.

Steps to Take After an Accident      

• If possible, move your car to avoid blocking traffic and to protect it from further damage.
• Call the police if somebody is injured or killed, if you can’t move your car, or if the accident involved a hit-and-run driver. Your uninsured motorist coverage pays for a hit-and-run accident only if you report it to police.
• Get the following information from the other driver:
  • name
  • address
  • telephone number
  • license plate number
  • license number
  • insurance company name (get the exact and complete name)*
  • insurance policy number
• Give the other driver the same information about you.
• Get the names, addresses, and telephone numbers of any witnesses to the accident.
• Notify your insurance company as soon as possible. Your company probably has a 1-800 number to report claims. If not, call your agent. The agent or company will explain the claims process, including how to schedule an adjuster and get repair estimates. Also, give your agent or company the names and addresses of any witnesses and anyone injured.
• If you reported your claim by phone, follow up in writing as soon as possible to protect your rights under Texas’ prompt payment of claims laws.
• Send the company copies of the accident report and any legal papers you receive about the accident.
• Cooperate with the company’s investigation. You might have to submit a proof-of-loss form or have a medical examination.

* If the other driver refuses to tell you the name of his or her insurance company, get a copy of the police accident report. The accident report should list the other driver’s name and insurance company. If the police did not investigate the accident, you can report the driver’s refusal to police. This could result in a report identifying the driver’s insurance company. In addition, the Texas Department of Public Safety keeps files of forms – called SR-22s – that show the insurance companies of people convicted of DWI or driving without insurance. Call the DPS Customer Service Bureau

512-424-2600
www.txdps.state.tx.us

Filing a Claim

Texas law sets deadlines for insurance companies to act after you’ve filed a claim. Companies must:

• Respond within 15 days of the date it received your claim in writing. It will probably ask you to document your loss.
• Accept or reject your claim within 15 days after you submit any requested documentation
• Send your check or draft within five business days after it agrees to pay your claim.

A company that cannot meet these deadlines must send you a notice explaining why. The company then has 45 days to either approve or reject your claim.

If the insurance company rejects your claim, it must explain the rejection in writing. If the company says your policy doesn’t cover the loss, ask to see the policy language that they used to make the decision. A court usually will order the company to pay if the language is unclear and the policy could reasonably be read in your favor.

Note: The prompt payment law does not apply if another driver’s insurance company is paying the claim. However, the company is still required to act in good faith and to make a prompt and fair settlement.

Accidents Caused by Other Drivers

If you were in an accident caused by another driver, the other driver’s insurance company should pay the following costs, up to the liability policy’s limits:

• repair or replacement of your car
• car rental while your automobile is being repaired
• your medical and hospital bills
• wages lost because of an injury
• compensation for pain and suffering if anyone is hurt.

If the other driver’s insurance won’t cover all your medical bills, file a claim for the difference against your PIP coverage and (for amounts greater than that) against your UM/UIM coverage or your health insurance policy.

If the other driver’s policy won’t cover all of your auto repairs, file a claim against your collision or UM/UIM coverage for the difference (minus your deductible) between the damage to your car and what the other driver’s policy will pay.

Settling the Claim

The other driver’s insurance company may ask you to sign a release to settle your claim that says you will not file additional claims related to the same accident. Get a letter from your doctor estimating the cost and length of your future medical treatment to determine if your settlement is fair. Don’t sign a release until you are satisfied with the total settlement.

You might want to consult an attorney before accepting a settlement. Texas law gives you two years after an accident to either settle your claim or file a lawsuit.

Texas law prohibits insurance companies from delaying payment of a claim to pressure you to sign a release. If you believe an insurance company is delaying payment to pressure you, file a complaint with TDI.

If the other driver denies fault, his or her insurance company may refuse to pay your claim. Independent witnesses could make a difference in getting the company to pay. It’s important to get names, addresses, and telephone numbers of any witnesses to the accident. Make sure the insurance company knows about the witnesses. If the company continues to refuse to pay the claim, you can file a claim against your own insurance or you may have to go to court to resolve the issue.

Ask your agent or your company’s underwriting department how a claim might affect your rates on renewal. A company cannot refuse to renew your policy solely because you had one accident in a 12-month period that was not your fault. However, if the accident affected your driving record, your company may consider it in determining your rates, whether you filed a claim for the accident or not.

Getting Your Car Repaired  

Your insurance company will either have an adjuster inspect your car and give you a repair estimate, or it will ask that you provide repair estimates from mechanics and auto body shops.

Insurance companies will pay for repairs or replacement only up to the car’s actual cash value. Actual cash value is the amount your car would be worth if it weren’t damaged.

If you and your insurance company can’t agree on the amount of your settlement, you can demand an appraisal. Appraisal allows you and the company to hire separate damage appraisers. The two appraisers choose a third appraiser to act as an umpire. The appraisers review your claim, and the umpire rules on any disagreements. The appraisal decision is binding on the amount of the damage. If there is a dispute about what is covered, you can pursue a settlement of the coverage issue after the appraisal. You must pay for your appraiser and half of the umpire’s costs.

Appraisal is available only in disputes between you and your insurance company. It is not available if the other driver was at fault and you disagree with his or her company’s offer.

Some companies may give you a list of preferred shops once you begin to repair your car, but they cannot require you to use a particular repair shop. For collision and comprehensive claims, your company is obligated to pay only for parts of like kind and quality to those that were damaged.

Totaling a Car

If the repair estimates are more than your car is worth, the insurance company will likely total your car and pay you its actual cash value rather than pay to fix it. Insurance companies use various sources for determining the value of your car. Ask the company what source it used to determine your car’s value.

The company might not have considered your car’s condition, special features, or value on the local market when it calculated its settlement offer. Be prepared to negotiate with the company to get what you think is a fair deal. A company might raise its offer if you can show that your car would sell for a higher price in your area. Get written price quotes for a similar car from several used car dealers, or look in the classified section of your local newspaper for used car prices.

If you’d prefer to have your vehicle repaired instead of totaled, you can keep your car if you are willing to subtract its salvage value from the insurance settlement. Make sure the cost to repair the car will not exceed the car’s actual cash value. To find out the salvage value, contact local salvage yards for estimates.

Getting a Rental Car

There are several types of coverage that will pay for you to get a rental car while yours is in the shop:

• If the other driver caused the accident, his or her liability insurance may pay for a rental car.
• If the accident was a hit-and-run or the other driver was uninsured and at fault, your UM/UIM property damage coverage will pay for a rental car.
• If your car was stolen and you have comprehensive insurance, your company will provide a set amount each day, up to your policy’s limit, for a rental car.
• If your car is being repaired or replaced for some other reason, your insurance company won’t provide a rental car unless you have rental reimbursement coverage.

• Dwelling pays if your house is damaged or destroyed by a covered loss. It also pays for unattached structures and buildings, such as fences, detached garages, and storage sheds.
• Personal property pays if the items in your house (such as furniture, clothing, and appliances) are stolen or damaged or destroyed by a covered loss.
• Liability provides $25,000 in coverage if you are sued and found legally responsible for someone else’s injury or property damage. You may be able to purchase up to $1 million in additional coverage.
• Medical payments pays the medical bills of people hurt on your property. It might also pay for some injuries that happen away from your home — if your dog bites someone at the park, for instance. A basic homeowners policy pays $500 in medical bills, but you may buy up to $5,000 in medical payments coverage.
• Loss of use pays your additional living expenses (housing, food, and other essential expenses) if you must temporarily  move because of damage to your house from a covered loss. Your policy will pay either a percentage of the amount of your dwelling coverage (typically 10 to 20 percent) or for a specific period after the loss (such as 24 months).

Types of Policies

Insurance companies in Texas may sell several types of policies with different levels of coverage.

If a company offers you a policy with less coverage than you’d like, ask if other policies are available. You may also be able to buy additional coverage by adding endorsements to your policy.

The two types of policies sold in Texas are:

• All-risk policies (also known as a comprehensive coverage or open perils coverage). These policies offer you broad protection and cover all causes of loss unless the policy specifically excludes them.
• Named perils policies (also known as specified perils coverage). These policies offer narrower protection than an all-risk policy and cover only the causes of loss specifically named in the policy.

Note about replacement cost and actual cash value:

Replacement cost is what you would pay to rebuild or repair your home, based on current construction costs. Replacement cost is different from market value and does not include the value of your land. Ask your company if you are not sure how much it would cost to rebuild your house.

Actual cash value is the replacement cost of your property minus depreciation. If your home is destroyed and you only have actual cash value coverage, you may not be able to completely rebuild.

To compare policies approved for sale in Texas, visit the Office of Public Insurance Counsel (OPIC) website

www.opic.state.tx.us

Policy Coverages

Companies may exclude coverage for certain losses. Even the most comprehensive all-risk policy will exclude certain types of damage.

1. Ask for higher deductibles — Deductibles represent the amount of money you pay before you make a claim. By requesting higher deductibles on collision and comprehensive coverage, you can lower your costs substantially. For example, Farmers has one of the broadest ranges of deductibles for consumers who want even more choices and savings.

2. Consider buying all your insurance from one company – Keeping your insurance at one company may make you eligible for multiple policy discounts. So if you have your car and home insurance with one company, you will get a discount.

3. Ask about automatic seat belt or air bag discounts — You may be able to take advantage of discounts on some coverage if you have automatic seat belts and/or air bags.

4. Take advantage of low mileage discounts — Some companies offer discounts to motorists who drive fewer than a predetermined number of miles a year.

5. Ask if discounts are available for cars with anti-lock brakes — Anti-lock brakes improve steering control and stability when a car is brought to a stop, thus reducing accidents.

6. Drop collision and/or comprehensive coverages on older cars — It may not be cost effective to have collision or comprehensive coverage on cars worth less than $1,000 because any claim you make would not substantially exceed annual cost and deductible amounts. Auto dealers and banks can tell you the worth of cars.

7. Buy a “low profile” car — Before you buy a new or used car, check into insurance costs. Cars that are expensive to repair, or that are a favorite target for thieves, have much higher insurance costs.

Ask the company you are considering buying insurance from if they offer discounts for: no accidents in three years, drivers over 50 years of age, driver training courses and good grades for students.

In addition to inquiring about discounts, you can also take advantage of the Farmers Friendly Review to review your auto insurance coverages and the rest of your insurance needs to make sure you are getting all the discounts possible.

Life insurance isn’t something you should just be thinking about, it is the foundation upon which all the goals you have for your children rest on. With the benefits associated with it, you should care enough for people you love to take care of them without even being there. As a matter of fact, that is the very objective of the plan and you should understand that you will not always be there for them, because you will pass on.

A lot of people just dislike handling the concept of life insurance coverage or term life rates. It must be the uncertainty of it which makes it so difficult: the belief that that they may die sooner than they think, or so much later that they may not need not plan at all. But that also is the element which makes the insurance plan so real. Don’t let it become your regret now. Act safe and take the life insurance plan already.

Nobody plans to die young, actually. But nevertheless, it happens, and it would be a shame to leave your loved ones unsupported when you leave. In fact, it s not like you will be dying young; merely that you may not stay as long as you wish. That’s why you need a life insurance plan to cater to the needs of the people you care about when you are gone.

You might want to explore the term life rates or idea of life insurance in general, sometime in your life. It s got lots of benefits that could well, benefit you in the future. Ok, maybe it benefits your wife or kids more, but really, it’s you telling them you will always be there for them even when you are gone. Even young people in McKinney are buying life insurance because of the precariousness of life in these present times. The fact that you are still in perfect health today does not mean that it will be the case tomorrow; hence the need to buy life insurance or at least compare the best term life rates. Life insurance is an excellent way to ensure that your family doesn’t feel much of a financial crunch in a case when you are critically ill or dead.

You may want to get life insurance coverage if you know that you are the only source of income for your family. Life insurance can be defined as a cushion that breaks the fall of your family in case you are gone away from them. In spite of the coldness of life insurance sales pitches or term life insurance rates presentations, the truth is that it is necessary for everyone that has a family – regardless of how young.

Secure your home with dead bolts and window locks.

Install a security system with outside signal and connection to local police. Hire a company to monitor it.

Install and maintain smoke detectors.

Install a sprinkler system for fire.

Install a fire alarm that automatically alerts the local fire department.

Stop smoking.

Keep walks and entrance ways clear of water and debris.