Distracted Drivers Are Costing Insurers Big Money

By: William Forbes

CNN posted an article today on how Arity, a unit of Allstate insurance, is developing a technology to track smartphone use in cars. The hope is that Allstate will be able to tell when drivers are actively using their phones while operating a vehicle. And, at some future point, Allstate may use the information to determine car insurance rates. 

It's an interesting article, but the most shocking and fascinating points, to me, were in Arity's research. The article says, "Arity analyzed data from 160 million trips by hundreds of thousands of Allstate drivers. What it found confirmed research showing that drivers on their phones are more dangerous."

Using claims data, Arity found that distracted drivers are costing insurers 160% more than drivers focused on the road. The research confirmed that distracted drivers are more likely to get into an accident and these crashes tend to be more severe.

In fact, Arity recommends drivers put their phones into airplane mode before heading out in the car.

Distracted driving is a topic we at Forbes Insurance Agency have posted about in the past, and will continue to shout about. The effects of distracted driving and using your phone while you drive are now being studied by multiple agencies, and they are all saying the same thing - this behavior is causing more accidents, more fatalities, and more expensive claims for insurers.

Here is a link to the full CNN article, titled, "Do you text and drive? Your car insurance may go up," http://money.cnn.com/2018/01/24/technology/texting-and-driving-distracted/index.html.

Here are links to some of our past blog posts on this topic:

  1. Smartphones Are Killing Americans: https://forbes-insurance.com/forbesinsuranceblog/2017/11/1/smartphones-are-killing-americans
  2. Why Are Car Insurance Prices Rising? https://forbes-insurance.com/forbesinsuranceblog/2017/6/7/why-are-car-insurance-prices-rising
  3. Claims Increase The Cost Of Insurance: https://forbes-insurance.com/forbesinsuranceblog/2017/3/8/claims-increase-the-cost-of-insurance
  4. Pennsylvania Passes Daniel's Law - Stricter Penalties For Texting And Driving: https://forbes-insurance.com/forbesinsuranceblog/2016/11/8/pennsylvania-passes-daniels-law-stricter-penalties-for-texting-and-driving

How To Prevent (And Fix) Frozen Pipes

By: William Forbes

Erie Insurance published a helpful article on its blog, ErieSense, on how to prevent your pipes from freezing this winter, and what to do if it happens.

I am re-posting the tips below. But, I wanted to highlight one of the most important things the article mentions. If your pipes do freeze, call a plumber to help you thaw them safely and avoid further damage to your home.

It may seem intuitive, but it's worth reminding folks they do not have to handle this situation on their own - call a professional to help you winterize your pipes, or thaw them, if you've run into that problem.

Here are Erie's steps for preventing frozen pipes:

  • Drain water from pipes that are likely to freeze. This includes your swimming pool and sprinkler water supply lines. 
  • Disconnect any hoses from the outside of your home, drain the hoses and store them in the garage. Make sure to close the indoor valves supplying these outdoor access points.
  • Insulate the area around vents and light fixtures. This helps prevent heat from escaping into the attic.
  • Seal any wall cracks. Be sure to pay careful attention to the areas around utility service lines.
  • Open kitchen cabinets. This allows the warm air to circulate around the pipes. 
  • Keep the garage doors closed to protect water lines.
  • Allow your faucets to drip cold water on the coldest days. The movement will make it harder for the water to freeze. 
  • Keep your thermostat at the same temperature day and night. Never let it fall below 55 degrees Fahrenheit when you leave your home.
  • Ensure you have proper seals on all doors and windows. 
  • Place a 60-watt bulb in areas where you’re concerned about pipes freezing. Make sure there are no combustible materials near the bulb.
  • Take swift action if the pipes located inside an exterior wall are freezing. Cut a hole in the wall toward the inside of the house to expose those pipes to warmer air.

Check out Erie's full blog post for signs that your pipes are frozen and tips for thawing them yourself: https://www.erieinsurance.com/blog/frozen-water-pipe-prevention.

Smartphones Are Killing Americans

By: Nicole Vattimo

Here is a very interesting article, originally published on Bloomberg, that discusses the surge in U.S. traffic fatalities and how they are linked to smartphone use, but are not being properly reported as such. The article, "Smartphones are killing Americans, but nobody’s counting," states that over the past two years, traffic fatalities have increased by 14.4 percent.

"In 2016 alone, more than 100 people died every day in or near vehicles in America, the first time the country has passed that grim toll in a decade," the article reports.

The problem is that many of these fatalities are not being attributed to distraction or mobile-phone use. Why is that an issue? Well, because regulators are not getting an accurate picture of just how dangerous cell phones are for drivers, and how many accidents they are actually causing. Without solid evidence (think numbers and stats) to indicate how many accidents are caused by cell-phone use behind the wheel, lawmakers and regulators can not push for new and improved laws or safety features.

The article talks about how cell-phone use has changed too; how actual calls are not happening as often as texting and social media. But, I would take it one step further and suggest that using our phones for music in our cars is another distraction. My family has Apple Music, which does sync with my car's stereo, but many times to change playlists, I find I have to look at my phone.

Additionally, have you seen the technology packed into most cars today?! Most new cars have touch screens, which, in my opinion, are tricky to use while driving, that can display: music options, navigation, car diagnostics, movies, and more. It's insane how many distractions are built right into the car stereo today.

Take a read of the full article here: https://www.msn.com/en-us/news/technology/smartphones-are-killing-americans-but-nobody%E2%80%99s-counting/ar-AAtQOp7?li=BBnb7Kz

Source: https://www.msn.com/en-us/news/technology/...

Zombies Have Bad Days Too

Check out Erie's latest blockbuster...and it's perfect for the season. Have a wonderful Fall and a Happy Halloween from all of us here at Forbes Insurance.

With all the buzz around the new season of AMC's The Walking Dead, what if a literal zombie apocalypse happened tomorrow? While it's highly unlikely that zombies will really take over, it's good to know that insurance is there to protect you when things go wrong, like a telephone pole falling on your house or your TV getting fried by an electrical surge.

Erie Customers Can Now Start Auto Glass Claims Online

By: Nicole Vattimo

A couple weeks ago I wrote a post about what to do if you have a cracked windshield (link here). Today, I want to follow up on that post to share that Erie Insurance customers can now go to erieinsurance.com to start an auto glass or windshield claim online. This is an easy and convenient way for customers to quickly get a glass claim reported and be connected with Erie's glass partner, Safelite® Solutions.

How To Get Started:
1. Navigate to erieinsurance.com
2. Once on the website, use the top navigation bar to go to "Service" and then to "Start A Claim"
3. On the "Start A Claim" page, use the link for "Starting an auto glass claim online"

Once you start the online glass-claim form, you will be asked to submit information including your policy number, phone number, and details of the claim (e.g. when, how, and where the damages occurred). Safelite will collect the claim details and follow up via phone call to schedule the repair. Safelite can also work through email or text, based on the customer's preferences.

If you have further questions or concerns about reporting an auto glass claim, always feel free to reach out to your Erie agent.

Could Oversharing On Social Media Cost You Your Insurance In The Future?

By: William Forbes

This article from Consumer Reports interviews representatives from the National Insurance Crime Bureau and the Insurance Information Institute on this subject and uncovers some interesting info.

The idea here is that by sharing photos of your family away from home on vacation, or posting about new and expensive purchases, you could be opening yourself up to theft. So, by sharing these types of posts, you could be violating your insurance policy's "reasonable care" clause, "which stipulates that policyholders do everything they can to make their home burglar-resistant and secure from risk," says the article.

Please don't be alarmed. We've never heard of an insurance company denying a home claim because of social media; and the experts in the article don't say that they know of a claim being denied either. But, they do posit, in the future, insurers may review people's social media activity in certain instances.

Beyond the issue of insurance claims, however, I think this article makes a good point about not oversharing on social media in order to protect your safety, home, and belongings. It's smart, especially in today's internet-connected society, to protect yourself by not letting the world know where you are and what you are doing at any given moment.

The article suggests waiting until you return home to post vacation photos, and to be careful of how much personal information you are giving away in comments. For example, try not to disclose where you are vacationing, how long you're there, your hotel details, etc.

check out the full article for more information: https://www.consumerreports.org/social-media/is-social-media-putting-your-home-at-risk/

Why Are Car Insurance Prices Rising?

By: William Forbes

Being an insurance agent, I get asked every day, "Why is the cost of my car insurance going up?" And, the majority of the time this question isn't even coming from one of my clients. I get asked by friends, family, my supermarket cashier...it seems to be a question on everyone's mind.

Believe it or not, there are some very specific reasons for the increased cost of auto insurance; and none of them have to do with insurance companies being out to get us (I hear this suggestion quite a bit as an agent, too).

Forbes recently published an article (link here) that does a nice job of explaining some of the reasons. As stated in the article, "the driving force in the upward march in premiums is an auto insurance industry that’s been finding it increasingly difficult to sustain healthy profit margins."

This means auto insurers are finding it difficult to make a profit off insurance premiums, when the expense of running an insurance company is considered.

The article points to a few main reasons why profits have been down for insurers:

  1. More costly accidents. Both the severity of accidents and the number of fatal car accidents have been trending upward. So, fulfilling these types of claims, particularly those that include high medical costs, is very costly.
     
  2. A decline in investment revenue. The article explains that insurance companies hold large investment portfolios, and when interest rates and investment income is lower, they can't offset losses.
     
  3. Bad weather. As comprehensive claims from bad weather (tornadoes, hail, flooding) continue to rise, so does the amount insurance companies pay out to their insureds. I would also add to this that cars are getting more expensive to repair - the cost of parts is increasing, and added technology features make what used to be simple repairs, more costly. For example, windshields now have cameras in them, and this increases the cost of replacing them.

For a deeper dive into these three points, check out the full article on Forbes.com. And, if you have questions about your policy, always feel free to contact your agent.

(Here is the full link to the article: https://www.forbes.com/sites/ccasazza/2017/05/23/why-are-car-insurance-rates-still-going-up/#3315a8cb7753)

Collection of Classic Cars Lost in Fire

By: William Forbes

In this heartbreaking article on msn.com (link here) , a fire destroyed a Canadian man's uninsured $3 million car collection. The cars were kept in a barn, which caught fire and was completely demolished. The man said he lost 45 years worth of work, more than 40 classic vehicles, and 40 collectible tractors.

This loss goes beyond the monetary value of the collection. It's obvious this man invested so much time and energy into his collection. To lose it is a hit on many levels, I imagine.

If you have collectibles, whether they are cars or other items, such as jewelry, firearms, art, trains, etc., you should talk to your insurance agent about scheduling coverage for them. Most homeowners policies give you a designated amount towards some of these items, but, usually, it's not enough to replace an established collection. When you schedule coverage, you can value the collection and receive coverage commensurate with that amount. The other benefit of scheduling coverage for collectibles, if there is a loss, you are not subject to your homeowner's deductible.

Certainly, in the event of a claim, a check from your insurance company can not replace the emotional loss. But, it can help you with the financial burden.

Claims Increase the Cost of Insurance

By: William Forbes

In last week's blog, I shared a story from Crain's Chicago Business, which said State Farm has just reported its worst year ever in terms of claims reported and the amount of money it lost insuring cars. The article hit on a number of trends insurance agents are seeing across the industry - distracted driving is leading to increased claims, and the increased claims are driving the price of insurance up for all of us. Even those of us who do not report claims are feeling the effects, as insurers raise rates for everyone in an effort to maintain profitability.

And, now, on the heels of that article, NBC News 10 recently published findings from an annual study conducted by insuranceQuotes that indicates people pay more for insurance after reporting a single claim. The article says specifically, "drivers now pay an average of 44 percent more for car insurance after making a single claim of $2,000 or more." Reporting a second claim is even more costly.

I'm not writing about these articles to scare people away from reporting claims. There are times when insurance claims are necessary, and in those cases, that's why you pay for insurance. The point I would like to make, however, is that you should really have a detailed discussion with your agent before you report a claim. Having a conversation with your agent is an important part of managing your finances. The fact is, reporting claims will result in higher insurance premiums, and possible surcharges.

More broadly, the increase in claims across our state have caused insurance premiums to go up for everyone. Even if you don't report claims, your bill is being affected by these industry trends. That's why it's so important for us, as a community, to put an end to distracted, aggressive, and unsafe driving.

Check out the NBC article here: http://turnto10.com/i-team/consumer-advocate/study-looks-at-impact-of-claims-on-car-insurance-rates 

Crain's Reports State Farm Suffers Worst Car Insurance Losses Ever

By: William Forbes

Take a read of this recent article published by Crain's Chicago Business, titled, "State Farm suffers worst car insurance losses ever."

The article touches on a trend we are seeing across the insurance industry. Reported claims are on the rise, and this results in higher insurance rates for all of us. In addition, the article makes a good point that State Farm's losses are a clear sign of how distracted driving is impacting insurance companies.

Erie stands out as one of the few companies that's been able to keep its rates level over the years.

Full link to article: http://www.chicagobusiness.com/article/20170228/NEWS07/170229881/state-farm-suffers-worst-car-insurance-losses-ever 

5 Times You Must Contact Your Insurance Agent

By: William Forbes

I'd like to use today's blog to remind my clients, and anyone who has insurance, that there are a handful of times when it's absolutely necessary you pick up the phone and contact your agent. If you have made any of the changes listed below, or have been involved in a claim, it's so important to get the details to your agent. Regarding the situations below, if you don't inform your agent, you may not be covered by your insurance policy.

I can't stress enough how important it is to tell your agent about:

  1. A Change of Address - Without the proper address on file, your insurance company may be sending critical communication to the wrong location. Even if you do not receive these communications, you are still responsible for the information detailed inside. Additionally, if you have homeowners or renters insurance, you want to be sure your policy is set up to protect the correct property. Finally, counties and cities have different insurance ratings, meaning if you move and don't inform your agent, you could be missing out on savings. It's your responsibility to inform your agent of a change of address.

  2. Additional or Replacement Vehicles - When you replace one vehicle on your policy with a new one, or if you plan to add another vehicle, it is crucial that you inform your agent. Generally, in Pennsylvania, it is your responsibility to inform your agent of an additional vehicle within 14 days. While you get a bit longer to report a replacement vehicle. I tell my insureds to report either as soon as possible, to avoid issues with coverage.

    One thing to note here - many people think when they purchase a new vehicle the dealer will contact their insurance company. This does happen in some cases; but, it is the insured's responsibility alone to report new and replacement vehicles to insurance. Don't rely on your car dealer to add a vehicle to your policy.

  3. Adding or Excluding Drivers - If you have someone who is regularly driving your car, or if there is someone prohibited from driving it (called an exclusion), you need to inform your insurance agent. In the event of an accident, without the proper drivers listed on the policy, coverage may be denied.

  4. Structural Changes to a House - Putting an addition on your home? Installing a pool? Any structural changes to your home need to be detailed in your insurance policy. These changes can affect the value of your home, and can mean it's time for new or additional insurance coverage to protect your family.

  5. A Claim - If you've had a home or auto claim, involve your agent. Your agent is your insurance advisor and can help you through the process. Including your agent is about more than just getting your claim reported. An agent can guide you through the claims process, and can act as your advocate with the insurance company.

Insurance Concept of the Week: Subrogation

Each week we will post and define an industry term or concept for our readers.

Subrogation is the transfer of your rights to the insurance company to sue or seek recovery from a third party. For example, if you get into an auto accident and your car is damaged, your insurance company will take care of repairing your vehicle. Then, on your behalf, your insurer will collect from the at-fault party to cover the cost of the repairs, and even get your deductible back in some cases.  

5 Things to Consider Before Reporting a Claim

By: William Forbes

Reporting a claim is not always as simple as calling your insurance company and receiving compensation. Claims, whether they are small or large, affect your insurance policy. Below are five things I recommend my insureds consider before reporting a claim. I point these items out because it’s important that customers understand when and why they should report a claim. Educating yourself about the claims process means being a savvier insurance consumer. 

1.       Report the claim immediately to your insurance agent or company.

The official guidelines for reporting a claim differ from company to company, so it’s important to check in with your agent or insurer to understand how quickly you need to report a claim. However, as a good rule, it’s important, whichever company you are with, to report claims as soon as they happen. This leaves less chance that details will be forgotten, and reduces the chance that there will be any questions about the claim’s authenticity from your insurance company.

2.       Is the claim cost larger than your deductible?

If the claim is not larger than your policy deductible, there is really no reason to report it. In this case, you are financially responsible for the cost of the repair, and there is no benefit to involving the insurance company. You don’t want a reported claim on your policy when you aren’t receiving any financial assistance from your insurance company.

3.       Can you handle the claim financially?

Simply put, insurance policies aren’t home- or car-maintenance accounts. Insurance is for catastrophic losses. Or, in other words, losses that create a significant financial hardship. Though insurance will pay for minor claims, you may end up hurting yourself in the long run, as multiple claims will drive up the policy premium.  This means you pay more for your insurance plan each year. Additionally, multiple claims increases the likelihood that your insurance company could cut your policy altogether.

4.       Often claims raise the annual premium of your policy.

Though many companies today have accident or claim forgiveness, which means your rate won’t increase for your first claim, it is important to understand how claims generally affect your overall policy premium.  The number of claims reported, along with the severity of each, can adversely affect the total price you pay for insurance.

5.       Claims stay on your policy record for a specified period of time.

Auto claims typically stay on your record for three years. Home claims stay on your record for five years. Having claims on your policy record can affect you when you shop for insurance. They often make it harder to receive the best possible rate, and certain companies will not accept new insureds with multiple claims.  

There is much to consider when deciding whether to report a claim. The best advice I can give is to talk to your agent about each claim. Agents are there to provide you with guidance and education, as well as help you through the claims process. Knowing all the facts can help you make a smart financial decision. 

 

What to do When You’ve Been in an Auto Accident – Advice from an Insurance Agent

By: William Forbes

You never expect it, and you certainly never hope for it, but it happens – you’ve been in an auto accident. Of course your first priority is making sure you and anyone involved is okay. But, after that, what do you do at the scene and afterwards to make sure you’re taken care of from an insurance perspective? There are a few things you can do to make sure the process goes smoothly with your insurance claim. And, doing this handful of things can mean the difference between an expedited claims process, and the stress of having to go back-and-forth with insurance companies.

1. Call the police to the scene. Even if it’s a minor accident, it’s worth it to call the police to the scene and have them fill out a report. When you involve law enforcement at the scene of an accident, they take statements from both sides and record the details of the event. If you don’t have the benefit of a police report, important details can be forgotten or even changed. As time passes it’s hard to remember the specifics of the accident, but your insurance company’s claims department will need the exact details to resolve your claim.

Unfortunately, as an agent, I’ve seen an insured struggle with a claim because the person who hit him changed his story. All that’s left in that case is one person’s word against another’s.  A report solves this issue. You may request a copy of the police report for your records; and, when you call your insurer’s claims department to report your accident, you should tell them that a police report was taken at the scene.

If for some reason you are unable to involve the police, then a disinterested, third-party witness can provide the same benefit. Just be sure to get the witness’s name and contact details and pass those along to your insurance company.

2. Take pictures of the scene on your cell phone, before moving the vehicles. For the same reason that a police report is helpful, photos of the scene eliminate the possibility that people’s stories will change over time. Any evidence you can provide your insurer that corroborates your story and solidifies details, will be a benefit to you during the claims process.

3. Obtain all pertinent information from those involved. To help move the claims process forward with no setbacks, it’s helpful to gather car and contact information from those involved, at the scene. Be sure to collect: name, phone number, year/make/model of the vehicle, the person’s insurance company, and his policy number (which can be found on the insurance ID card).

4. Contact your agent ASAP. You will want to contact your insurance agent as soon as possible to report the accident and get the claims process started. As we’ve discussed above, getting the insurance company up to speed as quickly as possible means a better chance of the involved parties remembering exactly what happened, and getting the claim resolved in a quick and hassle-free manner. The faster your agent knows what’s happening, the faster you will be back on the road with a repaired vehicle. Your agent can also help walk you through the claims process and make sure you’re aware of all the coverages available to you, such as towing reimbursement and rental-car coverage, if needed.