What determines Insurance Pricing

Aug 6th, 2018

I spent some time over the weekend touring a local museum with my 9 year old son. When we came across an exhibit on coal mining in early Appalachia, I became fascinated by the photo’s. My mind became fixated on the work ethic of those men and their willingness to perform dangerous jobs in order to provide for their families. Quickly my mind raced back into it’s risk analysis mode and the difficulty this gentleman and his business would face acquiring insurance in 2018. That’s when it dawned on me that most people really don’t know what causes insurance rates to differ.

If you don’t know where to look, finding affordable insurance can be both difficult and costly. Which is why having an experienced agent with access to multiple carriers, is your best option. Nearly every customer who calls an insurance agent and provides them with all of the necessary information for a quote will save time and create leverage. Those are two very important assets in the quoting process

Five basic reasons why some premiums are higher than others:

1. The type of exposure you are requesting insurance on will dictate the pricing. For example a Shark Diving Tourism company is going to be more expensive than a Floral Shop. This same concept applies across all lines of insurance.

2. If an individual or business has a history of filing claims in the past they can expect their premiums will be higher than those who have not. I have yet to run across an insurance company who just say’ “that’s cool, we won’t count that one”

3. In some states companies & individuals who have had financial difficulties in the past can expect to see higher premiums compared to those who have not. Bankruptcies, liens and judgement could be used as rating variables depending on the state and the carrier.

4. Experience is often used as a rating variable. For example, a recently licensed 16 year old driver is going to cost more to insure than a 35 year old driver. The same concept applies to the number of years a company has been been in business or insured with one company.

5. Your insurance agent could also be costing you hundreds and possibly thousands on your insurance. Believe it or not insurance agents are actually human and they sometimes miss things. Whether its applying every possible discount to a personal lines policy or asking for pricing credits on commercial policies.

If interested I’m offering everybody who took the time to read this a FREE comparison quote from multiple carriers.
Simply send me an email saying you read this blog and would like a quote sales@vfsknox.com

Renters Insurance

One of the most basic sales techniques used by every insurance agent is asking for a cross sell. If someone wants an automobile quote, the agent will ask about their home. If an individual doesn’t own a home, the agent will suggest renters insurance. Renters insurance? The very mention of it immediately leads to “what is renters insurance”¬†and “what does it cover?”¬†Hopefully this article will shed a little light on those two questions.

Renters Insurance is product designed specifically for individuals who do not own the home or apartment they reside in. The policy provides a predetermined amount of personal property coverage (set by the policyholder), a coverage limit for liability protection, a small amount of medical coverage and a set deductible limit chosen by the named insured.

What kind of things does a renters insurance policy cover?

Renters insurance covers the replacement of the policy holders personal property as a result of a covered peril and any extra living expense should they be asked to leave a location. For example a tornado damages a building or an upstairs neighbor leaves their water running and your unit is damaged. Renters insurance would cover those temporary housing expenses at hotel.

Does renters insurance cover my roommates stuff?

No. Renters and homeowners insurance only covers the named insured and all residents of the household who are directly related. Any non related residents will need to get their own policy to cover their personal property at the address.

Would my laptop or computer be covered?

Yes. Renters Insurance covers your personal electronics (laptops, phones, tablets, TV’s, computers) up to the amount of property coverage on the policy if it is lost or damaged as a result of one of the covered perils. However, if the item is simply lost or damaged as a result of being dropped, that wouldn’t be deemed a covered event.

Am I covered if something I own gets stolen outside of my home or apartment?

Yes. Renters Insurance covers “your stuff” away from the residence. If something is stolen, it would be covered because “theft” is a covered peril. Therefore, if your bike is stolen on campus or a laptop is stolen out of your car or hotel room, the item would be covered up to the policy limits. Of course, your deductible applies and you will need to file a police report.

What if my dog bites someone, would my liability coverage cover that?

Yes if the dog was properly underwritten at the time the policy was issued. It’s very important an agent develops all dogs to discover if they have a bite history or if the breed is listed on an ineligible list.

What types of things aren’t covered on a renters policy?

Typical day to day things like the power, water or heat going out at your home or apartment.

If you would like to learn more about Renters Insurance or would like a quote you can contact me us sales@vfsknox.com