Tester 'll Never " Satisfied "

Auto Insurance Coverages

Pays: Other people’s expenses for accidents caused by drivers covered by your policy, up to your policy’s dollar limits. These may include the other people’s

• medical and funeral costs, lost wages, and compensation for pain and suffering
• car repair or replacement costs
• auto 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 and  bail up to $250 if you are arrested.

Covers: You and your family members, "Family members" include anyone living in your home related to you by blood, marriage, or adoption, including 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, and spouses living elsewhere during a martial separation also might be covered.

You and your family members might be covered when driving someone else’s automobile –  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 dec page should list the names of all of the people  covered by the policy.

Pays: Medical and funeral bills resulting from accidents, including those in which the other person  is a pedestrian or bicyclist.
Covers: You, your family members, and passengers in your car, regardless of who caused the  accident.

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

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 reported the accident promptly to police.

• Bodily injury UM/UIM pays without deductibles for medical bills, lost wages, pain and suffering, disfigurement, and permanent or partial disability.
• Property damage UM/UIM pays for auto repairs, a rental car, and damage to items in your car. There is an automatic $250 deductible, which means you must pay the first $250 of the repairs yourself.

Covers: You, your family members, passengers in your car, and others driving your car with your  permission.

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

Pays: The cost of repairing or replacing your car after an accident. Payment is limited to your  car’s actual cash value, minus your deductible. Actual cash value is the market value of a car  like yours without damages.

Covers: You, your family members, passengers in your car, and others driving your car with your  permission.

Pays: The cost of replacing or repairing your car if it is stolen or damaged by fire, vandalism, hail,  or a cause 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.

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

Pays: Towing charges when your car can’t be driven. Also pays labor charges, such as changing a  tire, at the location where your car became immobile.

Pays: A set daily amount for a rental car if your car is stolen or is being repaired because of  damage covered by your policy

Stereo Equipment 
Your policy won’t pay for CDs, tapes, cell phones, citizen band radios, or stereo equipment not permanently installed in your car. However, you can buy endorsements to your policy that provide separate coverage for these items for an additional premium.

New or Additional Automobiles 
If you buy another car, your policy might automatically cover it with certain limitations. Read your policy to know whether it automatically covers an additional or replacement car.

• In general, an additional car usually has the same coverage as the car on your policy with the broadest 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 
Auto rental agencies offer collision damage waivers and liability policies. The collision damage waiver is not insurance. It is an agreement that the rental company will waive its right, with certain exceptions, to recover the cost of the car’s damage from the renter.

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 were driving.

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

Some policies require all drivers to be named on the policy for coverage to apply. Therefore, it’s important that you list all family members on the policy 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 will bill you for the extra premium you should have paid and could deny your claim and coverage.

If you have children attending school away from home, 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 appropriate coverages.

Generally, if a teenager is the principal driver of a particular automobile, the company will base the teen’s rate on that car. Otherwise, the company will assign the teenage driver to the car (usually the most expensive) in your household that produces the highest rate.

You may want to remove your children from 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 separate address.

It’s probably not a good idea to remove children from your policy if they are attending school away from home. 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.

Before writing or renewing a policy, insurance companies determine your risk for an accident by checking motor vehicle records for your driving history.  Some companies might also review your credit history.

Many companies use the Comprehensive Loss Underwriting Exchange (CLUE) to learn an applicant’s insurance claims history. If the company used a CLUE report to deny, cancel, or nonrenew your policy, you can get a free copy by calling the ChoicePoint Consumer Center or by visiting the ChoicePoint website

Before calling, get the CLUE reference number from the insurance company. Using the reference number will speed the process and ensure that you request the right report.

• If you’re having trouble finding insurance because you have tickets, accidents, or poor credit, keep shopping. Each company has its own guidelines for deciding whether to insure people. Several major insurer groups write coverage for high-risk drivers through one of their member companies.
• If you can’t find a company willing to sell you a policy, you may be able to get basic liability coverage through the   Automobile Insurance Plan Association (TAIPA). You can only qualify for TAIPA coverage if two insurance companies reject you.

TAIPA only provides the basic liability insurance required by   law. It doesn’t provide collision or comprehensive coverage or higher liability limits than the law requires. You can add personal injury protection (the minimum limit is $2,500) and uninsured/underinsured motorist coverage.

TAIPA coverage costs more than coverage from most other companies. TAIPA policyholders pay additional premiums, called surcharges, for traffic convictions. They also pay higher surcharges than other drivers pay for accidents.

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 TAIPA policies. 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.

• 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 full 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  ’ 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   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

If you were in an accident caused by another driver, the other driver’s insurance company should pay the following costs, up to the 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 Personal Injury Protection (PIP) coverage, if you have it. For amounts greater than that, you can claim against your uninsured/underinsured motorists (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.

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 as to the amount of the loss. 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.

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 typically use the National Automobile Dealers Association’s Used Car Guide to determine the value of your car.

The company’s offer might not recognize your car’s condition, special features, or value on the local market. Be prepared to negotiate with the company to get what you believe 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 automobile 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.

If you have more than basic liability coverage or another driver caused your accident, you should be able to get a rental car while yours is in the shop.

• If the other driver caused the accident, his or her liability insurance will 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 fixed or replaced for some other reason, your insurance company won’t provide a rental car unless you have rental reimbursement coverage.

Once you have filed a claim,    law sets deadlines for the insurance company to act.

• The company must respond within 15 days of the date it received your claim in writing. It will probably ask you to document your loss.
• After you submit any requested documentation, the company has 15 business days to accept or reject your claim.
• Once the company agrees to pay your claim, it must send your check or draft within five business days.

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.

Note: The prompt payment law does not apply if another driver’s insurance company is paying the claim. However, the company is required to act in good faith and to make a prompt and fair settlement.
If the insurance company rejects your claim, it must explain the rejection in writing. If the company contends that your policy doesn’t cover the loss, ask to see the policy language that supports denial of your claim. A court usually will order the company to pay if the language is unclear and the policy could reasonably be read your way.

If you have a problem with your insurance company, first try to resolve the problem yourself. Often disputes are the result of miscommunication. Talk to your agent or a company representative.    law requires most companies to have toll-free telephone lines for their policyholders.

If you are unable to resolve the dispute, you can file a complaint with TDI. TDI will notify the company of your complaint, ask for a detailed response, and send you a copy of the company’s response. The insurance specialist assigned to your complaint will send you an explanation of the outcome, usually within 45 days of receiving your complaint.

TDI has limited jurisdiction in some complaints. For instance, we can’t resolve questions of fact or determine who is at fault in an accident. These issues generally must be resolved in court. Even when TDI’s jurisdiction is limited, our involvement may encourage the company to review your issue more thoroughly. In addition, your complaints and inquiries help TDI assist other Texans by identifying potential problems with insurance companies and agents.

Rates vary widely 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   .

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

Companies may use a number of criteria to establish your premium. These 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. If you have accidents or tickets on your driving record, you’ll have to pay more for insurance. Companies may add surcharges to your premium for major convictions, some driving violations, and accidents that result in property damage. Some surcharges are mandatory and will apply to your premium for three years.
• 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.
• The type of car you drive. 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. Companies may 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.
• Whether you drove uninsured in   . Companies may charge more if you drove uninsured in    for more than 30 days in the 12 months before you applied for insurance. A company cannot otherwise charge you more for liability coverage because of your prior lack of coverage.

Companies must file their underwriting guidelines with TDI and update them each time they make a change.

Discounts can help you save money on your premium. Discounts vary by company. Following is a list of some of the discounts commonly available in   :

• defensive driving and driver education courses for young drivers
• students with good grades
• parent or family whose young driver is away at school without a car
• airbags and automatic seatbelts
• automatic daytime running lights
• antilock brakes
• two or more cars on a policy
• driver age and annual mileage driven
• policy renewal with good claims and driving records.

If you have a poor driving record, you can expect to pay more for your 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)
• moving violations (speeding, etc.)
• involuntary manslaughter
• driving under the influence
• criminally negligent driving
• driving without a license or with a suspended license.

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 insurer’s sources of information. 

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 motor vehicle tags 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.

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 not renewing your policy.

In   , 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 colliding with animals or birds
• damage from gravel and other flying and falling objects (the company can raise your deductible if you have three such claims in 36 months)
• towing and labor claims (the company can refuse to renew your towing and labor coverage if you have four such 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 a 12-month period.

Sometimes an insurer will move you to another company in its company group. If a company moves you to another company, it must give you 30 days’ notice that it will not renew your original policy. If the company fails to give you 30 days’ notice, TDI can require the company to renew your policy for another year with your original company.

If you get a nonrenewal or cancellation notice, start shopping for new insurance immediately. Make sure you keep your liability coverage uninterrupted to satisfy   ’ financial responsibility laws. If you still owe money on your car, your lender will usually require you to maintain collision and comprehensive coverages without interruption. 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.

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.