Why do I need auto insurance?
Your car has two unique qualities. First, your car is probably one of the
most expensive things you own. Insurance protects your investment and guarantees
you a way of coping with the expense of accidents, vandalism or theft, as well
as securing your financial responsibility to the bank or other institution
lending the money to buy your vehicle.
Second, when you drive, you are operating a powerful machine, weighing one
ton or more and capable of moving at over 100 miles per hour. You are responsible
for the safety of your passengers, your fellow drivers, other people's property,
pedestrians and yourself. Insurance helps you live up to that responsibility
by ensuring your ability to cover the costs of potential damages or injuries.
You are also required by state laws to be financially responsible. This requirement
is best satisfied through your insurance coverage. In most states, insurance
is a prerequisite to registering your car. So if you want to drive your own vehicle,
you must be insured.
How are rates set?
All insurance companies use statistical history to set rates because they
reliably predict future claims. Rates are based on the loss history of all
Hartford policyholders, the amount needed to pay expected claims and our business
expenses.
Why do companies charge different rates for different cars, drivers and situations?
Rates are based on statistics involving a company's experience with different
cars, drivers and situations. For instance, some vehicles cost more to repair
than others, some are more likely to be stolen and, according to statistics,
some are more likely to be involved in accidents. Some people drive many more
miles than the average, increasing the likelihood that they will be involved
in an accident. Other drivers have very little annual mileage, decreasing the
likelihood of an accident.
The more you are on the road, the higher your chances of being involved in an
accident. The same principle applies to commuting. If the majority of your driving
is spent in commuter conditions (increased congestion, people rushing to get
to work, inattention due to familiarity with roads) you are more likely to be
involved in an accident than someone who is traveling in off peak traffic hours.
Why is the cost of my auto insurance affected by where I live?
Bear in mind that where you live is only one factor in determining your insurance
rates. For example, statistics have shown that those who live in more traffic-congested
areas tend to have more frequent but less severe accidents, and those who live
in rural areas tend to have fewer but more severe accidents
Why do companies give discounts to people who take defensive driving courses?
Defensive driving courses refresh old skills and teach new ones to help prevent
accidents. The driver's initiative in taking steps to improve driving skills
combined with his or her increased awareness of defensive driving skills leads
many companies to offer a discount.
Why do companies give discounts when you have both auto and homeowners coverage
with them?
When people have both auto and homeowners with the same company, both parties
win. The company wins because it saves money. The initial cost of writing a
new policy is very high. Companies do not generally show a profit on a policy
for about three years. (This also explains why many companies give customers
a credit for renewing their policy.)
Another factor is that people who have both policies with the same company are
more likely to be long-term policyholders, which is cost-effective for that company.
The policyholder wins because of the discount (and usually an additional discount
upon renewal) and the convenience of having to deal with only one company.
Why does my spouse have to be listed on my policy?
A spouse living in the household is automatically insured because of the way
the policy provisions are written. Also, legally, if your spouse is insured
separately with lower limits than yours and has an at-fault accident, your
insurance company may be held liable for amounts over your spouse's coverage
to the limit of your policy. For example, if your spouse carries $100,000 liability
and you carry $300,000 and your spouse has an at-fault accident resulting in
$150,000 in damage and injuries, your insurance company can be held liable
for the $50,000 your spouse's policy does not cover. Your insurance company
is not collecting premium because the unlisted spouse is not included in the
rating of the policy for this liability.
Why do I have to list young drivers on my policy, even if I do not allow them
to drive my vehicles?
Automobile policies are written to automatically cover any licensed relatives
living in your household. Therefore, coverage is afforded to them, via your
policy, regardless of whose vehicle they are operating.
For example, your son is away at college and has an accident while driving a
friend's vehicle. He is covered by your policy for damages for which he is legally
liable. So, unless household members have vehicles registered and insured in
their own name, they need to be listed on your policy. Many companies offer credits
for young drivers such as good student and driver training credits.
Why do you ask so many questions?
Automobile insurance is a legal contract between the Insurer (the Insurance
Company) and the Insured (the policyholder). Each state has its own rules and
regulations on how an Insurer must write that contract. We ask questions necessary
to correctly rate and underwrite your policy.
What does auto insurance cover?
At the very least, you need the coverages required by your state to register
and operate a vehicle. You should consider purchasing enough coverage to protect
your assets and ensure that you can be financially responsible if you injure
someone in an accident.
Why do I need to buy Uninsured Motorist coverage?
Uninsured Motorist coverage protects you and anyone riding in your vehicle
if you are involved in an accident with someone who has no insurance. Even
if your state requires insurance coverage, there are those who ignore the law.
Should you be injured due to someone else's irresponsibility, Uninsured Motorist
will cover your medical expenses up to the limit on your policy.
How are claims filed and questions answered?
For both automobile and homeowners insurance program claims, call our toll-free
claims hotline 1-800-243-5860. Claims representatives are available 24 hours
a day, seven days a week. The claims representative provides step-by-step guidance
through a procedure that keeps paperwork to a minimum. We also offer Online
Claim Reporting.
How can I make changes to my policy?
Making changes to an existing policy is easy. Recognizing our customers' need
for convenient customer service, call our toll-free customer service number
at 1-800-624-5578.
When will my policy/bill be mailed?
Once we review and process your application, you will receive notification
from The Hartford within 2 weeks. If there are any questions, we will contact
you promptly.
What is a surcharge, how is it calculated and why does it exist?
A surcharge is the amount of money by which your premium is increased based
on Safe Driver Insurance Plan (SDIP) points assigned to your policy. SDIP points
are assigned after you are involved following in an at-fault accident and/or
one with damage exceeding predetermined amounts, depending on the state. Most
states also allow surcharges for motor vehicle convictions. A surcharge is
usually added to the policy upon the first renewal following the accident or
conviction.
The Safe Driver Insurance Plan (SDIP) was implemented by the majority of states
and insurance companies to fairly distribute the rising costs of auto insurance
among policyholders. Drivers with accident-free records pay the lowest possible
rates. Those who have had accidents or convictions pay more through surcharges
added by SDIP points.
Why does my insurance go up after an accident that's my fault even if I haven't
had one in years? And why would I be surcharged if I don't have the insurance
company pay the claim but choose to pay it myself?
If you haven't had an accident in years, you have probably been paying the
best rate available from your company. Once you have an accident, you are no
longer eligible for the best rate due to your accident and because statistics
show that those who have an accident are more likely to have another. Because
insurance rates are based on statistics involving the company's experience,
your rate is likely to be affected even if you pay the claim yourself - because
the statistical likelihood of your having another accident in which the company
will have to pay has increased.
Why is it important to report an accident that is not my fault to my insurance
company when the other driver's insurance is paying for repairs to my vehicle?
Most insurance policies require that you notify the company when you've been
involved in an accident, whether or not you were at fault. Immediately reporting
a claim allows the insurance company to fulfill its responsibility to the policyholder
by conducting a proper investigation and protecting the policyholder's interests
should there be a need for legal representation.
If a friend is driving my vehicle and is at fault in an accident, whose insurance
will pay for damages? Will I be surcharged?
If someone uses your vehicle (with your permission) and has an accident, your
company will pay for damages he/she causes. However, in states with No-fault
coverage, the insurance company of the person using the vehicles (if the person
is insured) would pay for that person's injuries. You would not be surcharged.
If someone uses your vehicle without your permission (i.e. it is stolen),
you are not legally liable for any damages they may cause, and there is no
liability coverage afforded by the policy. There is, however, coverage for
any damage to your auto provide by your comprehensive and/or collision coverage.
You would not be surcharged due to any damages resulting from theft of your auto.
Why do accidents that aren't my fault render me ineligible for insurance?
Statistics show that those who have a number of not-at-fault accidents are
more likely to continue to have accidents. Also, at some point consideration
must be given to whether the driver involved in the not-at-fault accidents
is contributing to the cause of the accidents.
These Frequently Asked Questions are provided by The Hartford. They are intended
for informational purposes only. In the event of a claim, the actual terms
of your policy will determine your coverage.
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