Ask Your Absolute Insurance Agent: When should my kids get their own auto insurance policy?

Q: ”When should my kids get their own auto insurance policy?”

A:  This is a question that we get often with our clients.  When children obtain their driver's license we list them as insured drivers on their parent's auto policy.  Every policy requires all licensed members of the household to be listed as an operator on the auto insurance policy.  We recommend letting us know when your children get their driver’s permit and when they get a school license, intermediate, or regular driver's license.  As kids grow up, when do they need to get their own auto insurance policy?

If your child has moved out of your house and is no longer a dependent, they need to have their own insurance policy.   Under most personal auto insurance policies, the “insured” covered by the policy includes “family members”.  Family members are limited to “a person related to you by blood, marriage or adoption who is a resident of your household.”  Once an adult child moves out of the household, they would no longer meet the definition of the “family member/resident relative” on your insurance policy.  We know your adult children will always be your family member, but unfortunately, they won’t be defined as an insured on your auto policy once they are no longer a resident in the household.  Why is this important?  Here are some examples to show why:

• Your daughter Amy is excited to go to her former ISU college roommate’s destination wedding in Colorado.  She rents a car and doesn’t buy the insurance offered by the rental car company.  If she were to be in an accident, the liability and physical damage from your insurance policy will not extend to the rental car.

• Your son Brent borrows his friend’s truck to move from an apartment in Waukee and to a new apartment in Ankeny and rear-ends another vehicle, injuring the other vehicle’s driver.  Since Brent is no longer a resident of your home, he has no liability coverage for the other driver’s bodily injury or the property damage to the other vehicle.  

• Your child is crossing the street in Des Moines and hit by a hit-and-run driver.  There would be no medical payments or uninsured motorist’s coverage for his or her own injuries.  Same if they are riding a bicycle and struck by a vehicle that was uninsured, underinsured, or left the scene.

Without coverage from an auto insurance policy, your child will have to pay these expenses themselves. Some of our largest claims come from the uninsured or underinsured motorists coverage.  This is why we are discussing this.

Another factor of whether to keep your child on your insurance is how the vehicle is titled.  With some companies, all vehicles on an insurance policy have to be titled to the named insured.  If your son or daughter has their own car titled in their name (even if they still reside in your home), they might need to have their own insurance policy.  Some of our companies do allow vehicles to be titled in different names - this is something that you should talk to your agent about.  

Each insurance company has its own guidelines, so it is best to talk to your Absolute insurance agent about your specific details.

Creating a Home Inventory

Included in most Homeowners, Condo-Owners, and Renters policies is coverage for the contents of your home.  Do you know how much coverage you need if you had to replace everything in your house?  Would you know what you had in each room of your home in the event of a claim?

Keeping an inventory is helpful to know how much coverage you need, and to have a list of your contents in the event of a claim such as a break-in, a fire claim, or other claim.

There are several different ways to create an inventory – pick a method that works best for you.  Keep a copy of the inventory someplace other than your home.  It is recommended that your attorney or executor of your estate have a copy as well.  You can also leave a copy with a trusted family member or emergency contact.

Ways to keep an inventory:

• Written List  
• Digital List (Online with a Google Doc or Excel Spreadsheet) 
• Pictures/Videos - this is especially recommended for more valuable items.  If you are taking a video, audibly describe items as you move through your home. 
• Combination of above 

It is recommended that you take inventory by room within your house.  Make sure to take photos from different angles and in a well-lit room.  You can also use sticky notes to label certain items.  Keep receipts or appraisals of higher-priced items.  For electronics and appliances, it is recommended to also include the model number and serial numbers of each item.  Don’t forget to include your garage, shed, deck, and basement when you are completing your inventory. 

One example of how you could set-up your inventory digitally would be to use Google Docs.  Create a folder called “Home Inventory”.  Within the folder, you could upload photos/videos of each room.  An inventory would be created with either Google Docs or Google Sheets (similar to Excel); create a separate page for each room. If you are working on the inventory with another household member such as a spouse, you could share the folder and give them editing rights so that they can also modify the inventory.  You could also share the folder with your attorney, executor, or emergency contact with viewing rights so that they have a copy as well, or you could give them a hard copy to keep as a back-up for you.

A few times a year, review your inventory to add new items or remove items that you have gotten rid of.  Make it a habit to update your inventory when you add new purchases to your home.

As you are doing an inventory of your house and come across special or high-value items such as jewelry, art, cameras or coin collections, you might want to talk with your agent about insuring these items as Scheduled Personal Property (SPP) on your policy.  Here is a blog giving more information about SPP, but you can also reach out to your agent for more specific information.

Agreed Value vs. Actual Cash Value: What is the best coverage for your boat or camper?

Do you have a boat and/or camper insured (or that needs to be insured)?  Do you know what type of value it is insured for?  You might want to look at your most recent declaration page to see how it is currently covered.

Boats and campers are typically insured one of two ways - either Actual Cash Value (ACV) or Agreed Value (AV).  What is the difference?

• Agreed Value (AV):  Agreed Value means that if we have a boat insured for $10,000, and it is determined to be a total loss in a covered claim, the insurance company would pay the agreed value of $10,000.
• Actual Cash Value (ACV):  ACV pays up to the amount an item is insured for, but the insurance company determines the value.   An insurance company might use NADA and comparables to look up the value of a boat or camper.  With the same example above, the insurance company might determine (after looking at NADA and comparables) that the value is $8,000 so they pay $8,000 if the boat was determined to be a total loss in a covered claim.  

Agreed Value is better coverage, and since the values of boats and campers can be all over the place we recommend changing to Agreed Value coverage.  We have had issues where a client has felt that their camper is worth more than NADA and comparables show - Agreed Value coverage fixes this problem when there is a total loss.  If you would like to discuss how changing from Actual Cash Value to Agreed Value could affect your insurance policy, contact Absolute Insurance today by emailing us at service@insaia.com or calling us at (515)279-2722.

For more information on insuring your boat, check out our Boat Insurance page.

Rental Car Rules

Do you have an upcoming trip planned where you will be renting a rental car?  Pekin Insurance, one of the companies that we represent, posted a blog earlier this month regarding rental cars and how to avoid a big rental car bill.  

1. Make Sure Your Insurance Checks Out:  The vast majority of insurance policies transfer over to rental cars - the coverage you have on your vehicle would be the same coverage as the rental car.  For example, if you have liability-only coverage on your vehicle, your rental car would have liability-only insurance.  If a claim were to come up, it would be filed with your auto insurance company.  Your credit card company you use when paying for your rental car may also provide some coverage as well.  Before you rent a car, you should talk to your insurance agent or credit card company to know what coverages transfer.
2. Your Age Affects Price:  Some companies will apply a "Young Driver" charge for any driver under 25
3. Watch Out for Extra Fees:  Make sure to read the rental agreement to avoid extra fees.  There are usually additional fees for returning the car with less than a full tank of gas, using a toll transponder, or using GPS.  
4. Skip the Inspection at Your Own Risk:  Before you drive off in your rental car, make sure to take the time to do an interior and exterior inspection of the car.  If you have a smartphone, make sure to document any existing damage with pictures or videos and report them before driving off.  (Make sure to get down under the bumper too)
5. Think Before You Sync:  Several in-vehicle systems store information such as contact information and even work/home addresses.
6. More Drivers Could Mean More Money:  Before you add more drivers, look at what extra fees might be included with each additional driver and evaluate whether you think additional drivers are needed

For more information, check out the blog from Pekin Insurance!  If you have any questions about what coverage transfers from your auto policy, contact your agent.

Mind the Gap

London, England: perhaps one of the better examples in this day and age of the fusion between rich culture and history with modern flair. From the Tower of London to the nearby Shard that dominates the cityscape today, there are beautiful and wonderful examples of the new and fresh intertwined with old and true. One of the most prevalent and important aspects of the new age London is by far the introduction and utilization of the Underground.Very simply, this is a highly efficient subway system that crisscrosses and connects the entire town and surrounding areas.

While I was visiting this marvelous and beautiful city, my lovely wife and I used the Underground for nearly all of our transportation needs and became quite familiar with it within a few days. One thing that sticks with me, besides for the cleanliness of the system (we were there just prior to the 2012 Olympics and perhaps that was why everything was so clean), was the voice on the speakers as the train stopped to unload and load passengers: "Mind the Gap". That, in addition to several signs, helped passengers be cognizant of the 6 inch gap between the loading platforms and the train itself. Surely, to get a foot stuck or to actually fall between this gap would be more than a mild inconvenience! It would be a complete disaster of life and limb with major financial consequences.

I took to heart the warning and have took to heart the implication beyond simply getting a free foot amputation. Just as another captive company mentions frequently, we all most be cognizant of and recognize the gaps in our insurance policies. Some of these gaps are standard issues that every company has implemented- such as Flood exclusions. Some of these gaps can be solved through the use of riders like water back-up coverage and earthquake coverage. Some of the gaps exist simply because your lifestyle has changed and you now use your vehicle for delivery verses simply driving to one location on a daily basis.

This is where your local, independent Absolute Agent is worth their weight in gold! We can help uncover gaps in coverage and help you understand the ones that will always exist and the ones that can be mitigated against. Keep in mind that the cheapest possible insurance may not be the best for your situation. Also keep in mind that there is value in being able to actually sit down with your agent in the office and not always call the 1-800- WHERE-THE-HECK-ARE-YOU??? and get a different person each time nor always go to the computer for internet quotes and guidance. Help us help you keep your financial livelihood from experiencing an amputation!

Mind the Gap, Friends.

Things Insurance Fans Love

As a Local Independent Agent, I often have the pleasure of discussing many facets of life with clients over the phone or in the office. Sometimes these jovial discussions remain just that: jovial and entertaining. However, other times, folks tell me things they don't necessarily care for about insurance. I understand many of these concerns, but when it comes down to the reality of what insurance actually does and how it responds when we are in our most desperate positions, I cannot help but to be a fan and advocate. Usually, upon reflection with the clients, we both end up feeling better about the situations.

Here are just a few items that insurance fans love:

• Risk Transference. This is the basic tenet of insurance. For a fee, we allow another entity to absorb our first dollars worth of liability. This is AWESOME! The insurance company gets behind us when we have momentary lapse of judgement and cause damage to another party up to our policy limits. Without this, our bank accounts, wages, homes, and retirements would all be subject to lawsuit that follows! Better yet, get yourself an umbrella policy and boost those limits even higher with broader ranges of coverage.
• Roadside Assistance. If you have ever broken down alongside the side of the road, then this is an awesome endorsement available via most companies auto policies (restrictions apply per company).
• Water Back-Up/Sump Pump Failure. This is another one of those special endorsements via the home insurance policy. What happens to your sump pump when the power goes out? You guessed it- it goes out as well. If you have a finished basement, these mild irritant just became a costly mess. However, if you this endorsement on the home insurance, it will pay to cover clean up and the cost to replace ruined building items and contents (subject to policy limit).
• Rental Car Reimbursement. You've just had the accident. Sure enough, you were at fault. You have great liability limits and the other party will be handled well through your carrier, but now your sole means of transportation will have to be in a shop for the next two weeks to get repaired. This is more than a mild annoyance. This is devastating! Thankfully you and your Absolute Agent added rental car reimbursement to the full coverage on your vehicle so that you can utilize a rental car while your vehicle is being repaired. Another day saved through a proper conversation with your Absolute Agent (limits apply to per day cost and coverage is only available if comprehensive and collision coverage is purchased on the vehicle).

These are but a few of the things insurance fans love. There are definitely more to review in detail and we will definitely touch on them in the future. Until then, contact your Absolute Agent today at 515-279-2722 for more information. www.insaia.com

What's Insurance Up To?

In a world where the only constant is change, it can be difficult to keep up on the little things (and big things) that affect us on a daily basis. Between our families, jobs, and pets; the essential daily grind of our lives; as we connect ourselves further and further into the macrocosm of society to free up our time to get involved in even more activities... as .... as... as... Full stop....

We are busy. The reasons for this are as varied as we are from person to person. Each of us has a particular skill set that make us valuable to, and within, society. However, for most folks, insurance is NOT that thing. But do not despair! There is hope! Like a shining beacon on a hill, there is hope for those lost in the dark landscape of insurance unknowns and that shining beacon on the hill is none other than YOUR ABSOLUTE INSURANCE AGENT! They have the knowledge and expertise to know what insurance is up to!

Contact your local, independent ABSOLUTE AGENT in order to help you weather the STORM of liability, deductible, and endorsement talk. They can help you through the confusing maze of insurance speak and set you on a path to smooth sailing. Call us today at 515-279-2722.

Spring has Sprung!

Finally Spring has come and with it comes the possibility of spring showers through April and May. With the rain will come the rejuvenation of the outdoor world. The lawns will turn to green and the tulips will begin to bloom. These are beautiful sights to behold after a winter of being held hostage in homes due to the frigid winds and temperatures. However, as these showers melt away the bits of snow and ice on the ground and as the ground thaws, there can be a lot of extra water coming towards the foundation of your home and ultimately being routed to you sump pump. This is an excellent time to head down to your basement and open the sump pump well do some your regular spring maintenance. No one wants to deal with the problems associated with a malfunctioning sump pump and there are a few steps to take to maintain your pump and keep it in the best working order. These tips are general guides and you should follow the manufactures recommendations first and foremost.
These tips were found at www.homerepair.about.com:
Plan on doing these items every 3-4 months:

• Clean pump inlet screen
• Check power cord and make sure the cord is connected to power
• Dump a bucket of water into the sump to raise the float and make sure the pump turns on

Plan on doing these items every year:

• Remove the pump from the sump and clean it and inspect it
• Clean out the sump
• Check the owner manual to see if the pump bearing require grease or oil. If you do not have the manual look it up on the internet using the manufacturer and model number of your pump or contact the manufacturer
• Replace the pump in the sump
• Check power cord and make sure the cord is connected to power
• Dump a bucket of water into the sump to raise the float and make sure the pump turns on, adjusting the float if necessary

We at Absolute Insurance also STRONGLY advocate that homes with sump pumps should also install a battery back-up pump that will assist your main pump in the event of a power loss. There is also a newer version of a pump that uses the home’s water lines to act as a pump rather than using electricity. This is highly beneficial if you are in area that losses electricity consistently during storms. Call your Absolute Agent today at 515-279-2722!

You've Got Q's; We Got the A's

Q:  The color of my car affects my insurance rates, right?

A:  False.  The color of your car does not impact your car insurance rates.  What does influence your rate is your vehicle's year, make, model, body type, engine size, safety-features, and anti-theft features, along with your credit history, driving record, and geographic location.


Q:  No Fault Insurance means it's not my fault, correct?

A:  No.  It means that your company will pay for the damage to your vehicle (if physical damage is purchased) regardless of whose fault it is.  This type of policy is not available in Iowa and is a state specific type of coverage.  I, for one, am thankful that Iowa has not adopted this type of policy!


Q:  If I recently paid my insurance bill, the new car I just bought is covered?

A:  Yes, to a point.  Most insurance companies require that you notify the company of the agent within a specified number of days after the purchase.  There is a short grace period where the coverage does automatically transfer from one full coverage vehicle to a new full coverage vehicle.


Q:  If I lend my car to a friend and they get into an accident, will their company cover the damages?

A:  False.  Your car, your responsibility!  However, your friend's insurance could act as excess insurance if the damages exceed your policy limits.


Q:  I don't want uninsured/underinsured motorist because I don't want to pay for those drivers' cars!

A:  This is a common misconception.  That coverage is purely for your protection.  It pays for your lost wages and medical bills if you are struck by a driver without or not enough coverage (relative to the accident).  It does not pay for ANY vehicles, yours or theirs.

Annuities: Safe Choice in Choppy Market

With the recent credit and market insecurities, many people have lost as much as 55% of previous investments in their stock driven 401k's and IRA's.  For some, this isn't the end of the world as they may be young enough to make up for the losses in the future.  For others, the loss comes right at the time of retirement and will have devastating financial outcomes. 

Given the current market conditions and the see-saw nature of the S& P and Dow Jones, now may be a great time to consider an investment in an annuity backed IRA.  These operate in much the same way as stock driven IRA's, except without the risk of losing your investment.  These types of IRA's offer guaranteed interest rates which, as we have all now seen, stocks do not!

There are various types of annuity products available, some of which are readily available to transfer your existing stock driven IRA's directly over to a guaranteed interest rate annuity IRA.  Whether you have a qualified or non-qualified fund, we have a solution to fit your needs.

Now is the time to talk with your Absolute Agent and discover the awesome power of guaranteed interest rates combines with the power of compounding interest.  Don't let your money slip away in the market.  Call today for information. 

Steering Clear of Staged Accidents

It happens more than you think - a driver causes an accident to collect the insurance money - and you could become the victim.

The Sudden Stop:

• "It happens like this," says Hartford Special Investigations Manager Odie Waters, "I'm driving along, minding my own business, in rush hour traffic, and the car in front of me inexplicably slams on (the) brakes.  I read-end that car and I get blamed for the accident."  The driver of the first car will claim that a "phantom" dog or child ran into the road, or that the car in front of them had stopped suddenly, although that car will not be involved in the accident.  Any witnesses will have driven off long before the policy arrive, and it's nearly impossible to prove a dog didn't dart out.

Inattentive Targets in Traffic:

• The drivers in such a scam cruise clogged highways and city streets, watching in the rear view mirror, looking for someone not paying attention.  In the past, two cars might employ a tactic called the "swoop and squat," where one car would crowd the victim from behind and another would stop suddenly in front.

The Phantom Wave:

• Another type of staged accident can occur when a driver is trying to merge.  The scam artist will wave you into the lane and then crash into the side of your vehicle.  This can also happen when someone is backing out of a parking space.  A second car will stop and wave the first car out, as if waiting for the space, but then drive into the first vehicle.  In both cases, the scam artist denies stopping or waving, and police find the victim at fault for failing to yield the right of way.

Tips to Avoid Staged Accidents

How you can avoid a staged accident:

• Pay attention to the road - no applying make-up, shaving, texting, or talking on cell phone.
• Be wary of "beater" cars - especially if they are changing lanes suspiciously.  Even if the driver has no ill-intent, the condition of the car might mean a poor driver
• Maintain a safe following distance
• Call policy and the insurance company promptly after an accident.  If the other driver discourages you from doing so, it is all the more important to call promptly
• Tell your claims handler if the accident seems suspicious

Back to School: Kids in College

As the days slowly close out sooner and the weather begins to cool down, we know it is time for recent high school grads to ship off to college and start their higher education process.  This is a wonderful time for both parents and students alike, but also one that can be emotionally and financially depleting.  As your student goes away to school, some interesting problems can develop in terms of how to cover the property of the new student while living outside the home.

To begin, living arrangements for new students can vary widely, whether they must stay in the dorms or our living in an apartment, or rented home.  Some other issues may present themselves as to whether the student will return home for the breaks and summer, or will they have a permanent address while living in the college town.  Some of the answers to these situations may lead you down different paths for the proper coverage of the students property.

While most companies are willing to extend the personal property out to the student in the event that they are full-time students and their permanent address is still at home, there can be variances on how things are covered in the event that they live in an apartment and consider that their permanent mailing address.

Another aspect to consider is the fact that some of these students will be operating a vehicle while at school and it will become important to correct the vehicle garaging zip code.

Consult your Absolute Agent and describe your situation in order to ensure you have the correct coverage for you and your college student.

Off Season: Keep the Boat Insured

Summer is over, and you've taken your boat out of the water.  To save a few dollars, you cancel your boat insurance.  After all, what could possibly happen to your baby while it's hibernating? 

A lot, according to Progressive.  "You'd be shocked at the number of claims filed in colder months," says Dominic Mediate of Progressive.  "Nearly two out every 10 Progressive boat claims filed in northern states happen between Labor Day and Memorial Day."  Don't take a gamble on nothing bad happening.  Common off-season claims include:

• Fire, theft, vandalism, and flooding:  Most claims are filed for one of these reasons, which can occur anytime of the year.  Without coverage, boats damaged by fire, theft, vandalism, or flooding aren't protected
• Injuries that occur on or around your boat:  Some boaters don't realize they could be responsible for injuries that occur on or around their boat - even if the injured person was there illegally.  Without liability coverage, you could be responsible for the damages or the injured person's medical bills.  

Keeping your policy all year round might also save you a few bucks.  For example, Progressive's disappearing deductibles reduce your Comprehensive and Collision deductible 25 percent for every claim-free policy period.  Four policy periods in a row without a claim equals a $0 deductible.  Canceling your policy could mean paying more or the entire deductible, generally $500 or $1,000.

Check your policy and consult with your Absolute Agent before making any decisions.

Spring Time Fun: Insurance for Toys

Insurance is not like the old one size fits all ball cap.  Rather, people with specialized needs will want to get a policy that provides coverage for those needs in specific.  Often times, especially with boat insurance, it is often overlooked or attached to a homeowners policy to cover liability, however, often times this is truly basic coverage that may not suit your situation.

Most often, it is better to separately insured your toys with specialized policies that can provide coverage for Custom Parts and Equipment or to add coverage to possible belongings, such as fishing equipment on a boat owners policy.

Much like an auto insurance policy, special coverage can be purchased for towing, roadside assistance, and rental reimbursement on many specialty lines products including motorcycle, RV, ATV, boat, and personal watercraft.

Another important, and often times, neglected coverage comes by way of the RV, with an optional replacement cost endorsement (if new) and vacation liability coverage.  These can be added to your specialty lines insurance coverage at reasonable cost and leave you worry-free.

We understand that these aren't just toys, they are a way of like.  Your life.  We pride ourselves in partnering with companies that hold this same view and offer competitive rates for specialty claims centers with representatives trained specifically to handle your custom needs.

Call your Absolute Agent for further details on coverage and rates.

Water Back-up of Sewers and Drains

As spring rolls in to an already saturated Iowa, make sure you know your risk for Water Back-up of Drains.

Water Back-up of Sewers and Drains is an optional endorsement on a standard home insurance policy that provides coverage in the event of water or sewage backing up through the drains or in the event of sump pump failure.  Neither of which are covered perils on a standard home insurance policy.

Typically, the cost for this coverage ranges between $40-$80 per year per $5,000 in coverage and some companies require that a sump pump be present in order to secure this type of coverage.  Also, many companies will not allow a current client to add the coverage during the term of the policy.  In these cases, it can be added at the time of renewal.  Other companies will have a 30 day waiting period before the coverage takes effect after the endorsement is issued.

The coverage provided is broad in nature and will cover contents, structural damage, and clean up.  Some companies have different deductibles for this type of coverage from the Named Perils deductible that shows on the Declaration page of your Home Insurance Policy.  There are some companies, however, that maintain the same deductible across the board.  Contact your Absolute Agent for further coverage questions and deductible options if you already have the endorsement in place.

Scheduled Personal Property Coverage

This blog post focuses on Scheduled Personal Property (SPP) and how to insure it properly for the full replacement value.

As most readers already know, your home insurance covers personal property at a certain percentage of your dwelling coverage.  This percent is usually set at 70%, so if you have a $100,000 policy on your home, then your contents are covered up to $70,000.  While this is good coverage, there are limitations placed on certain types of property.  These types of property include (but not limited to):

• Jewelry
• Guns
• Artwork
• Antiques
• Currency

Some of these limits are as low as $1,500 in total per class of items.  Also at stake when looking at these items is that they will fall under the total household deductible.  By this, if your $5,000 wedding ring was stolen, then the company would pay up to the $1,500 minus your deductible (nowadays, a standard home insurance deductible is $1,000).  By this, you would not be able to replace the ring with like kind and quality.  An easy way to get these to replacement value is to get an appraisal for each item that would exceed (or come close to) the limit and get it over to your Absolute Agent.  Not only will the pieces be insured to that value, but they would have a separate deductible of your choosing.  Give us a call today.