Red Pencil on Insurance

A famous politician used to say, "How is that working out for you?" Do you know when car insurance will not work for you?

I will take you to such a place. For now, let me say that insurance companies have a legal right not to cover in certain situations. The problem areas are when we don't tell them things that they are supposed to be told.

An insurance contract has one thing in common with all contracts. Contracts should be a meeting of the minds. What if we don't tell the company things that are important to insuring us. If we hide things, then there is not a meeting of the minds. How can an insurance company cover your car if they don't know what they are insuring?

Insurance companies don't like us concealing or misrepresenting facts related to our auto policy. They can reject claims for such reasons. Let's list some don'ts for all of us to know.

  • You have a new roommate who shares your car and your insurance company does not know about it. Bad move on our part.
  • You lend your car to a friend for a few weeks and do not notify your insurance company. Big mistake because your friend has the vehicle for regular use.
  • Your adult child takes your car to another state to live. So, your daughter is on your auto policy. She moves out-of-state. Now you have a situation where the car is garaged at another location. Whenever you change garaging of any vehicle, your insurance company must know. When the vehicle is across state lines, you are operating under the insurance laws of another state. By the way, this state is not the state where your auto policy was written and issued. Your Florida policy follows the Florida coverage laws. Now you see the problem. Your insurance company doesn't know what is going on with your car, and the car is being driven in Georgia with auto coverage written for Florida. Trouble in paradise in this scenario.
  • Your young teenager reaches the age of 15. For every parent, the day comes when our child grows into a teenager. Many companies want you to inform them at age 15 whether they drive or not. This is because they are in the home and sometimes things happen with cars and teenagers in the same home. Inform your insurance company before there is a problem. From Step 1 at age 15, Step 2 at Learner's Permit, & Step 3 at a Drivers License.
  • You use your car for Lyft or Uber Driving. How about delivering pizza? How about for your business? What about driving to provide patient home-care, such as driving to home-after-home during a single day? A bad moon is arising for these extra uses of a personal vehicle. This is the key. Our personal lines auto policy is not for business use or work-related types of uses. Our use of the vehicle does not fit the type of policy, unless we specifically include our use in the policy. Mostly, these are commercial vehicle uses that require a commercial policy. Now you know!

In Summary: Be aware of what are the need-to-know facts for insurance companies, especially related to drivers and driving situations. What is the best rule for you? Tell your insurance company of any changes in additional drivers, how you use your vehicles, and where the vehicle is regularly parked. Match your facts to your policy. Get confirmations on policy changes and ensure that you agree with all changes (get them in writing). You can have confidence in your policy when you do your homework and check up on your coverages.

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