Statistics show that automobile accidents are the number one cause of death for people between the ages of 15 and 20.  In fact, drivers between the age of 16 and 19 cause up to four times as many accidents as older drivers.  For these reasons, auto insurance companies don’t like to insure these drivers and therefore charge substantially more to protect the risk.  So, how do you get your teenager insured for a decent rate?

Try enrolling your son or daughter in a driver’s education course offered by a local government agency or school district.  For a very affordable rate you can get your child the kind of driving expertise that is needed to ensure they are driving and leading happy lives well into their senior years.  Of life, not high school!

There are any number of local businesses that will offer these driver’s education courses, but most of the time your child’s high school will offer the same.  It is beneficial to the school to have safe drivers as well to reduce liability and promote healthy driving habits in the lives of their students.

Don’t look at this as simply a way to save money on your auto insurance, instead, think of it as a way to guarantee that your child is driving the right way.  If your child is driving the right way, that means they are driving the safe way.

We all know that high school and college boil down to fashion shows and an arms race in material possessions in a lot of ways, but don’t let this affect your pocket book when it comes to your child’s car. Auto insurance companies will charge much more money to insure a truck or sports car because of the increased risk based on the drivers that typically drive these vehicles. In other words, nobody believes that someone who drives like a Grandma will buy a Miata.

Instead of getting mixed up in making sure that your child thinks they have a cool car or a popular car, ensure that they are driving a car that is generally viewed as safe and insurable. Nothing says safe like a nice four-door sedan such as a Ford Taurus or a Mercury Sable. These vehicles are generally driven for safe transportation only, not to race or prove how fast you can go.

Also, remember that the year of the vehicle can also affect how much the auto insurance company will charge you. If you are driving a 2009 Ford Focus then it will be charged more due to the fact that it is new and new parts will cost more. Whereas a 2001 Ford Focus may not cost as much to have parts replaced and the general value has gone down on the vehicle.

Another benefit to an older vehicle is that most banks won’t require you to carry comprehensive or collision coverage on a vehicle that is 10 years old or older. The reason being that this vehicle isn’t worth enough to pay for the coverage and would likely be totaled if a decent amount of damage was done to it. In turn, the insurance company doesn’t charge as much as there isn’t as much being covered.

Cash for Clunkers seemed to many like a program aimed at stimulating only one industry in our nation’s financial world.  Auto makers would get to sell more cars because people were getting rid of their old “clunkers”.  However, the recent spike in sales due to this program is also having a great effect on the auto insurance industry.

Think about the basics of it all.  These clunkers are all over ten years old and had very little worth.  In turn none of them likely had any more than the basic “liability” coverage on the vehicle.  Now, with more value to the vehicle and the new loan from the bank, collision coverage is required and then the consumer might add rental and medical, etc.

Also, consider that many people that had these vehicles that were turned in for the cash for clunkers program may not have used the vehicles at all.  They had determined they couldn’t get the right value and they just sat in the driveway, waiting for someone who wanted a deal.  Now, the trade in goes from no auto insurance at all, to a new full coverage policy for the insurance company.

In the end cash for clunkers is definitely having a greater effect on the actual auto makers, but the auto insurance industry could come out smelling like a rose as well!

JD Power and Associates rules the world in terms of business rankings and their ranking of auto insurance companies customer service is no different. USAA was ranked #1 by a long shot in the 2008 Poll, however their relationship with military members and families disqualified them. USAA would have had a score of 922 out of 1000.

Car insurers: Favorites of customers
Rank Insurance Company Overall Satisfaction Score
1 Erie 896
2 The Hartford 894
3 State Farm 893
4 Liberty Mutual 886
5 American Family 880
6 GEICO 876
7 Nationwide 875
8 MetLife 873
9 Automobile Club Group 867
Industry Average 867
10 Allstate 863
11 Esurance 860
12 Safeco 855
12 Travelers 855
14 Farmers 849
15 Progressive 844
16 AIG 840
17 Mercury 835

Source: J.D. Power & Associates

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Pennsylvania auto insurance liability limits are set, like any other state, to insure that regardless of who you may get in an accident with, they have the coverage to pay for your damages if they are negligent. Those who don’t adhere to the Pennsylvania auto insurance liability laws are subject to legal action, including being sued for damages. Below is the Pennsylvania auto insurance liability limits with a brief summary of what each means.

All liability limits with Pennsylvania auto insurance or any other auto insurance are listed in BIPD format, separated with slashes, like 15/30/5. Pennsylvania auto insurance does demand minimum liability limits of 15/30/5, meaning:

Bodily Injury limits of $15,000 and $30,000 refer to how much you could expect from your auto insurance company to pay for another vehicle’s damage that you caused. If you caused an accident your auto insurance company would pay for up to $15,000 for injuries to one person in another vehicle, up to $30,000 for all passengers in that vehicle.

Property Damage liability limit of $5,000 means that your auto insurance company would pay for up to $5,000 in damages to the vehicles you damaged in an auto accident.

Pennsylvania auto insurance law demands that you hold at least these limits for your vehicle, but for the price it is worth it to go a little higher. Vehicles and medical bills are more than ever these days and you don’t want to be in a bind.

When you think of auto insurance you immediately think of a few things if you are like most other red-blooded Americans. You think of the premiums you must pay every month to carry your auto insurance and how much it could help you out of a bind if you are to get into an accident that is your fault. However, are you aware of what auto insurance companies can do for your community and our government as a whole?

Every state in the country benefits from auto insurance companies when it comes to tax money, in the multiples of billions of dollars every year while the federal government gets even more. What does this mean to you? It means that your auto insurance company is paying a lot of the tax dollars needed to create the roads that you drive on every day. It means that auto insurance companies help to build your community in ways you may not be aware of.

Auto insurance companies also make it possible for our economy to thrive by making it possible for more people to own vehicles and spend money. By having auto insurance companies assume the risk involved with you driving your vehicle every day it makes you owning a vehicle more attractive to the companies that sell the vehicles. By you establishing credit with that company you are establishing credit that makes you a more attractive buyer to other types of companies.

By auto insurance companies allowing hundreds, thousands, and millions of people to do this they are making that number of people available to be potential buyers in a capitalist economy. Before you know it, every business is thriving and making money and people don’t even realize one of the men behind the curtain. You know, that annoying little company that you pay the periodic auto insurance premiums to?

You had an auto accident and feel that the other party is completely responsible and you know that the auto insurance companies will see it the same. But what if there is something that you are forgetting about, something that makes it possible for the auto insurance company to place a fraction of blame on you? What kinds of defenses against negligence are there for someone who seems to be at blame for an auto accident?

One of the most obvious defenses of negligence in an auto accident that auto insurance companies like to look at is the assumption of risk. What type of risk did you know was involved before you entered the possibility for the accident? For instance, you may believe that the other party is 100% responsible for an accident where they ran a red light, but what if the other party was going 100 mph trying to make it through a red light? Even though the light is green, you still have a responsibility to make sure the intersection is clear before entering the intersection.

Who had the last clear chance to avoid the accident? If an auto insurance company sees that you had an accident while entering the interstate from an on ramp and the other party had nobody in the lane next to them, that party could have some responsibility for the accident. Even though they had the right of way to be in that lane, they also have the responsibility to avoid the accident as they had the “last clear chance” to do so.

After the negligence is determined based on considering both of the above then the auto insurance company won’t necessarily pay for everything that has happened to your car. Make sure that you are mitigating your damages immediately after your accident, if your car is making a noise that is only getting worse, stop driving it! Auto insurance companies will only repair those things that were directly caused by the accident, not after the accident.

You have just been in an accident and you are to the point of freaking out, what will the auto insurance decide? Who was at fault for this accident? There are times that it is absolutely apparent to you at the scene and you have no doubt who will be saddled with fault for the accident, but what when it isn’t so clear? What happens when the auto insurance companies determine fault, or negligence, in an auto accident.

First, what are your legal duties owed to the auto insurance company in terms of your responsibility as a driver? For instance, you have a legal duty to follow the legal rules of the road as you drive in your vehicle every day. You have a legal duty to stop at every stop sign and every red stop light. You have a legal duty to keep your car’s tires aired up and free of the risk of going flat and blowing out on the road. Get it?

Next, did you breach a legal duty owed to the other drivers on the road that your auto insurance company would look at and decide against you? Did you run a red light or make an unsafe left turn or anything else that is clearly displayed on the city streets and roads that you are driving on? If you breach a legal duty that you owe to the drivers on the road with you then you can bet your auto insurance company will find you to be at fault for the accident.

Once the auto insurance adjuster has determine if you breached a legal duty owed they will move on to the next step of an accident, actual damages. In short, did something you did while you were driving cause actual physical damage to another vehicle or object? Something you did on the road may make someone angry or may have made them swerve their vehicle, but unless it caused damage, you did nothing wrong in the eyes of auto insurance.

Finally, what is the proximate cause of the auto accident? This could be the breach of a legal duty owed or it could be something as simple as backing your vehicle and not looking behind you. You are legally allowed to back your vehicle, but if you hit someone it is likely your fault. If backing is the proximate cause, then the auto insurance accident investigation is over.

So you have just finished arranging your auto insurance and you are on the way home from the auto insurance office and your significant other poses a question to you. What is the difference between comprehensive and collision coverage in the auto insurance world? While we all know that you know the answer and don’t need anyone’s help, consider the following few paragraphs a brush up to your vast knowledge.

Think of collision coverage as anything that has to do with your vehicle and another vehicle. In the auto insurance world two cars colliding can’t be a comprehensive claim, but a car and another object can be a collision claim. For example, if you have a minor fender bender with another vehicle in traffic that is a collision claim. However, if a tree topples over for no reason and falls on your car, that is a comprehensive claim.

Auto insurance agents will generally recommend that you carry a lower deductible on your comprehensive coverage for a couple of reasons. First, your comprehensive deductible won’t alter your premiums all that much for a reason that directly flows into point number two. Second, comprehensive coverage can have a lower deductible for very little because you aren’t generally at risk for comprehensive accidents like you are for collision accidents.

In short, auto insurance views collision coverage as the coverage for your vehicle striking another object be that a vehicle or a pole, etc. Auto insurance views comprehensive coverage as what covers those things that are out of your control, such as fire, vandalism, flood, and hail, etc. Don’t believe the hype that liability coverage is all that you need on your vehicle, you need comprehensive and collision coverage if you hope to ever recover your vehicle.

There are a veritable plethora of terms for you to understand if you are going to begin to know what auto insurance is all about. You must know how to read your auto policy, know how to drive your vehicle, and you absolutely must know what affects your auto insurance premiums. One thing that will affect your auto insurance premium is what is known as a “hazard” in the world of auto insurance, here are the three main types of hazards in auto insurance.

Physical- a physical hazard in auto insurance is something that is out of the control of the driver of the automobile. For example, if it starts to rain then the risk, or hazard, involved in your drive suddenly goes up but rain starting is completely out of your control. Any auto insurance company would consider rain to be a hazard, but only a physical hazard that is out of your control.

Moral- a moral hazard in auto insurance is something that an individual would do to purposely cause an accident or claim. For example, if you were purposely trying to make someone rear-end your vehicle by constantly pulling in front of vehicles and slamming your brakes, you are committing what auto insurance considers to be a moral hazard.

Morale- a morale hazard in auto insurance is something that you are careless about and ends up causing an accident. For example, if you are speeding and weaving in and out of traffic because you know that you have auto insurance and it will pay for any damages you have committed a morale hazard.

When it comes down to it, a “hazard” in auto insurance is the element that is added that makes an accident more likely. If you become the person that makes these things a habit, expect it to be tough to find good auto insurance for a decent rate.

Auto Insurance, like any form of insurance, is all about risk. More specifically, it is about managing risk in a way that helps an auto insurance company a achieve tidy profit and give you peace of mind. The following are ways that any insurance company, including auto insurance companies, will try to manage risk.

The first key is to reduce the amount of risk that is involved in a particular situation. One example for someone trying to reduce the risk to make their auto insurance premium more affordable is to get a alarm system to deter someone from breaking into your vehicle. Another example would be taking a defensive driving course to reduce your auto insurance premium.

Another way to manage your risk is to retain part of the risk for yourself, or in your auto insurance policy, to take a bigger deductible. For example, if you agree to pay a $250 deductible you will have a higher auto insurance premium because you are asking the auto insurance company to take more of the risk.

Yet another way to manage your risk is to avoid the things that would make you appear to be a bigger risk to an auto insurance company. If you avoid speeding and taking the risk of getting more speeding tickets you will avoid the risk of your auto insurance premiums going up. Avoid difficult intersections and you will avoid the risk of being in auto accidents.

Finally don’t forget that the moment that you buy auto insurance you are managing your risk by transferring some of your risk to the actual auto insurance company. We all know that auto insurance premiums can be expensive, but we also know that the roads can be a dangerous place full of risks. Manage your risks and purchase a good auto insurance policy today.

Due to the nature of the business, and the reputation it has earned, auto insurance is generally viewed as a field that is trying to dupe you. However, some of this is a general uninterested view of the actual auto insurance contract itself that leads some to believing it is something that it is not. Consider a few facts of your auto insurance contract below and get ahead of the auto insurance “game”.

An auto insurance contract is what is generally referred to as a contract of adhesion. What this means is that the contract is written by the seller and agreed upon by the buyer with an “as is” or “take it or leave it” agreement. This adhesive nature leads to any ambiguities in the contract being read by the law in the favor of the insured, not the insurance company.

An auto insurance contract is an aleatory contract, meaning that the contract is valid even if unequal values are exchanged or one party benefits more than the other. For instance, an insurance policy could be called into action a month after being signed, meaning the insured has only paid one premium and the insurance company may have to pay thousands.

An auto insurance contract is a conditional contract in that the insured must pay their premiums, file a claim, participate in an unplanned insured event, and the insured product must be insurable. In other words, the insured must meet these conditions and the contract is enforced.

An auto insurance contract is one of the utmost good faith in that both parties must act in good faith to fulfill the contract
An auto insurance contract is what is referred to as a contract of indemnity. Indemnity is the entire meaning of insurance altogether, indemnity meaning that the insurance company promises to make whole the insured that suffers the loss.

An auto insurance contract will hold all of the above and if you don’t sign you don’t have the insurance. To put it lightly, be prepared to make the above agreements and you will have auto insurance!

We know that having auto insurance is the law and we can get in trouble for not having auto insurance, but why pay for it? Why pay for something that you may never use? Just what is it that auto insurance companies are doing when you are giving them a portion of your paycheck every time the bill comes? To put it short, insurance companies are managing your risk for you. To put it long, just keep reading and find out why you pay for auto insurance!

It may seem silly and not make much sense on the surface, but in essence you are paying your auto insurance company to assume the risk involved with you driving when you pay your premiums. What type of risk is involved when you drive your vehicle to work every day? What type of risk is involved when your son or daughter gets in the vehicle to go to school? What types of risks are we talking about? Financial risks, did that put it simply enough for you?

Think about your vehicle if you were to have a major crash today that was your fault, how much money would you be losing? What if you caused severe damage to the other vehicle involved in the accident, how much money have you lost now? While you may have been paying your auto insurance premium for several months or years without an accident, suddenly it all becomes worth it and that “suddenly” is what it is all about. Having to pay a $500 deductible and have your vehicle and the other person’s vehicle repaired makes it all worth it, right?

That is why we pay for auto insurance, because it helps manage the risk involved with driving a motor vehicle on a road full of crazy and inattentive drivers. It helps manage the risk involved in having a moment of absent mindedness in a day full of quick and important decisions. Most of all, auto insurance helps manage the risk involved with having a comfortable everyday existence.

Did you know that there are over 8,000 insurance companies in the United States today with over $3.1 trillion in assets? While you may be blown away by those numbers you may still be asking, why have insurance at all? Why have auto insurance? When you think about it the facts are quite simple, we have auto insurance for peace of mind, to prevent losses and to save money…that’s right, save money!

First off, consider the peace of mind that you have when you have auto insurance. If not for your auto insurance you would constantly be worried about what is coming around that next corner when you drive. A $20,000 car being totaled would be the worst thing that could happen in a world without auto insurance. In a world with auto insurance, your $20,000 car being totaled is just an inconvenience.

As we just touched on, auto insurance helps you prevent losses in ways that you may never have imagined. You generally tend to think of the damage to your own vehicle being covered by your auto insurance, but this couldn’t be further from the truth. Where almost any driver will prevent a loss is by the potential damage that they cause to another driver.

Let’s say that you have an accident that causes significant damage to another driver and the driver’s vehicle and the accident is your fault. Instead of worrying about negotiating with mechanics and doctor’s and so on, you let the experts take care of it for you. In short, have auto insurance on your vehicle is like having an attorney for your vehicle. If there is damage to your vehicle or anyone else you come in contact with, let your auto insurance take care of it!