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Insurance needs in retirement
01-22-2014, 01:12 PM
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#1
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Thinks s/he gets paid by the post
Join Date: Feb 2006
Posts: 4,872
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Insurance needs in retirement
I'm 6 weeks away from ER at 52. I have my finances sorted out and now I'm looking at my insurance needs. I'm single so I don't need things like life insurance, but I thought I'd ask what insurance I need. Here is my plan so far.
Buy my employer's COBRA dental plan as it is only $50/month, gives excellent coverage and I have a couple of crowns possible in the near future, according to my dentist.
Buy an ACA health plan and get a subsidy by keeping my income low. I could spend $450/month continue my company cadillac plan under COBRA or get a 2k/6k silver plan for around $330/month which would be reduced to $105/month with the subsidy.
Car insurance. I have a 7 year old Honda Civic with $120k miles. My annual mileage will go from 17k to under 5k without my commute. I'm going to reduce my collision and comprehensive coverage so the annual cost of car insurance goes to around $450.
House insurance. I don't want to mess with this so I'm leaving it as is at around $1200/year
I'm looking at buying a 1 or 2 million dollar umbrella policy.
Have I missed anything?
__________________
“So we beat on, boats against the current, borne back ceaselessly into the past.”
Current AA: 75% Equity Funds / 15% Bonds / 5% Stable Value /2% Cash / 3% TIAA Traditional
Retired Mar 2014 at age 52, target WR: 0.0%,
Income from pension and rent
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01-22-2014, 01:23 PM
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#2
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Thinks s/he gets paid by the post
Join Date: Mar 2010
Location: Kerrville,Tx
Posts: 3,361
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Quote:
Originally Posted by nun
I'm 6 weeks away from ER at 52. I have my finances sorted out and now I'm looking at my insurance needs. I'm single so I don't need things like life insurance, but I thought I'd ask what insurance I need. Here is my plan so far.
Buy my employer's COBRA dental plan as it is only $50/month, gives excellent coverage and I have a couple of crowns possible in the near future, according to my dentist.
Buy an ACA health plan and get a subsidy by keeping my income low. I could spend $450/month continue my company cadillac plan under COBRA or get a 2k/6k silver plan for around $330/month which would be reduced to $105/month with the subsidy.
Car insurance. I have a 7 year old Honda Civic with $120k miles. My annual mileage will go from 17k to under 5k without my commute. I'm going to reduce my collision and comprehensive coverage so the annual cost of car insurance goes to around $450.
House insurance. I don't want to mess with this so I'm leaving it as is at around $1200/year
I'm looking at buying a 1 or 2 million dollar umbrella policy.
Have I missed anything?
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It used to be that you would get a lower rate if the car was used for pleasure only, not to work or school. check with your agent to see if that applies to you. (Or if you shop let it be known that you don't commute to work) when the discount was still around it was around 10% because you avoid driving in rush hours.
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01-22-2014, 02:39 PM
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#3
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Thinks s/he gets paid by the post
Join Date: Jan 2008
Posts: 1,495
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Quote:
Originally Posted by nun
I'm 6 weeks away from ER at 52. I have my finances sorted out and now I'm looking at my insurance needs. I'm single so I don't need things like life insurance, but I thought I'd ask what insurance I need. Here is my plan so far.
Buy my employer's COBRA dental plan as it is only $50/month, gives excellent coverage and I have a couple of crowns possible in the near future, according to my dentist.
Buy an ACA health plan and get a subsidy by keeping my income low. I could spend $450/month continue my company cadillac plan under COBRA or get a 2k/6k silver plan for around $330/month which would be reduced to $105/month with the subsidy.
Car insurance. I have a 7 year old Honda Civic with $120k miles. My annual mileage will go from 17k to under 5k without my commute. I'm going to reduce my collision and comprehensive coverage so the annual cost of car insurance goes to around $450.
House insurance. I don't want to mess with this so I'm leaving it as is at around $1200/year
I'm looking at buying a 1 or 2 million dollar umbrella policy.
Have I missed anything?
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Congratulations on being only six weeks from ER. You must be as elated as I am jealous (I'm 54 Tuesdays from ER: no Mondays, every other Friday off). My situation mirrors yours and I have no other insurances beyond the types you've mentioned.
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01-22-2014, 02:40 PM
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#4
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2003
Posts: 18,085
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Sounds good to me. Get that umbrella quick!
You might consider a higher deductible on homeowners if you want to shave the premium.
__________________
"All animals are equal, but some animals are more equal than others."
- George Orwell
Ezekiel 23:20
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01-22-2014, 05:05 PM
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#5
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Full time employment: Posting here.
Join Date: Mar 2012
Location: seattle
Posts: 646
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+1 on increasing the home deductible.
Also, I know you said don't mess with h.o. ins, but I would check to see if the loss limit on the structure is ok.
Does the auto policy have towing/recovery? With 120k, I would get that for sure. AAA is easy.
Valubles, jewelry, collectibles of big value?
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01-22-2014, 05:07 PM
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#6
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Recycles dryer sheets
Join Date: Jan 2007
Posts: 398
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Quote:
Originally Posted by nun
House insurance. I don't want to mess with this so I'm leaving it as is at around $1200/year
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I am in a similar situation (54, no dependents). I may ER at any time, but find myself in perpetual OMY syndrome.
My insurance company informed me a year or so ago that if I will be eligible for a 5% discount on my homeowners premiums once I retire and reach 55. I do not know if this discount is standard practice at most insurance companies, or if it is specific to my company. However, it might be worth asking your insurance company if they offer a discount for being retired.
Yes on the umbrella insurance. I do not have it either and deserve a grade of F-. It is high on the list.
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01-22-2014, 05:10 PM
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#7
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2010
Location: Sarasota, FL & Vermont
Posts: 36,370
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Sounds like you have things covered.
I would check to see what the dental coverage covered if those two crowns become a reality. As I recall, the coverage under our dental plan was pretty skimpy - in fact so skimpy that it wasn't worth keeping so I self insure. If it is worth keeping, then keep it, have the crowns done and then consider dropping dental and self insuring.
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
Retired Jan 2012 at age 56
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01-22-2014, 05:29 PM
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#8
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Thinks s/he gets paid by the post
Join Date: Jul 2006
Location: Denver
Posts: 3,519
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I think you have your bases covered. Call around for pricing on your home, auto & umbrella policies & ask for pricing for different deductibles. And remember to do that every other year or so.
My dentist is up front with pricing, and if that's the norm, you should be able to determine if the dental insurance makes sense. You could also check out other so called dental insurance policies in light of your upcoming dental work.
Unless there's a need to stick with a doctor what is not included in your ACA plan, I think you'll find it hard to beat the advantages of the subsidy - if you can control your income.
You must be excited!
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01-22-2014, 06:03 PM
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#9
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Thinks s/he gets paid by the post
Join Date: Aug 2012
Posts: 1,862
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Congrats to you!!!
Have you considered long term care insurance? That's about all I can think of, and not everyone needs or wants to pay for it...
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01-22-2014, 09:36 PM
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#10
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Thinks s/he gets paid by the post
Join Date: Feb 2006
Posts: 4,872
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Quote:
Originally Posted by pb4uski
Sounds like you have things covered.
I would check to see what the dental coverage covered if those two crowns become a reality. As I recall, the coverage under our dental plan was pretty skimpy - in fact so skimpy that it wasn't worth keeping so I self insure. If it is worth keeping, then keep it, have the crowns done and then consider dropping dental and self insuring.
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The dental is excellent, 100% for crowns and root canals. As my dentist has been eyeing a tooth with a big old filling in it for a crown I think the COBRA dental is a good thing to keep.
__________________
“So we beat on, boats against the current, borne back ceaselessly into the past.”
Current AA: 75% Equity Funds / 15% Bonds / 5% Stable Value /2% Cash / 3% TIAA Traditional
Retired Mar 2014 at age 52, target WR: 0.0%,
Income from pension and rent
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01-22-2014, 09:38 PM
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#11
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Thinks s/he gets paid by the post
Join Date: Mar 2010
Location: Kerrville,Tx
Posts: 3,361
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One other item if your paying for a disablity policy you can stop that, as retirement implies an income not directly dependent on if you can work.
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01-22-2014, 09:38 PM
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#12
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Thinks s/he gets paid by the post
Join Date: Feb 2006
Posts: 4,872
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Quote:
Originally Posted by SumDay
Congrats to you!!!
Have you considered long term care insurance? That's about all I can think of, and not everyone needs or wants to pay for it...
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I already have that.
__________________
“So we beat on, boats against the current, borne back ceaselessly into the past.”
Current AA: 75% Equity Funds / 15% Bonds / 5% Stable Value /2% Cash / 3% TIAA Traditional
Retired Mar 2014 at age 52, target WR: 0.0%,
Income from pension and rent
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01-22-2014, 09:41 PM
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#13
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Thinks s/he gets paid by the post
Join Date: Feb 2006
Posts: 4,872
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Quote:
Originally Posted by meierlde
One other item if your paying for a disablity policy you can stop that, as retirement implies an income not directly dependent on if you can work.
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Yes I am stopping disability insurance, but now I remember that I am keeping a basic life insurance policy with my employer that costs around $5/month so that I maintain my eligibility for my employer's dental and health plan when I reach 55.
__________________
“So we beat on, boats against the current, borne back ceaselessly into the past.”
Current AA: 75% Equity Funds / 15% Bonds / 5% Stable Value /2% Cash / 3% TIAA Traditional
Retired Mar 2014 at age 52, target WR: 0.0%,
Income from pension and rent
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01-22-2014, 10:26 PM
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#14
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2009
Posts: 6,695
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Quote:
Originally Posted by nun
I'm 6 weeks away from ER at 52. I have my finances sorted out and now I'm looking at my insurance needs. I'm single so I don't need things like life insurance, but I thought I'd ask what insurance I need. Here is my plan so far.
Buy my employer's COBRA dental plan as it is only $50/month, gives excellent coverage and I have a couple of crowns possible in the near future, according to my dentist.
Buy an ACA health plan and get a subsidy by keeping my income low. I could spend $450/month continue my company cadillac plan under COBRA or get a 2k/6k silver plan for around $330/month which would be reduced to $105/month with the subsidy.
Car insurance. I have a 7 year old Honda Civic with $120k miles. My annual mileage will go from 17k to under 5k without my commute. I'm going to reduce my collision and comprehensive coverage so the annual cost of car insurance goes to around $450.
House insurance. I don't want to mess with this so I'm leaving it as is at around $1200/year
I'm looking at buying a 1 or 2 million dollar umbrella policy.
Have I missed anything?
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I can echo what others have posted here.
When I went on COBRA in my last 17 months of working (this was 5 years ago), I made sure to keep dental coverage because I knew I had some costly dental work needed and this would be my last chance to get it while I still had coverage. I then figured out that those COBRA premiums, copays, and deductibles were about the same as 2 visits per year with a minimal amount of extra work.
I have signed up for an ACA Silver plan which will cost me just over $300 a month, net of subsidy, which is a lot cheaper than the last comprehensive plan I had which cost me nearly $700 per month (until I dropped it in 2011), and a broader plan than the hospital-only plan I had from 2011 to the end of last year.
Because I live in a large co-op complex, I did not feel I eneded an umbrella plan because I was paying for similar coverage through my co-op's insurance. However, I did raise the liability limits of my auto policy from 100/200 to 250/500. You should make sure you let your auto insurance company know about the change in your car's use class because Pleasure use will cost you less than Drive-to-Work use. And let them know about your big upcoming decrease in annual mileage because that will save you, too. I have a 7-year-old car so I nearing the point at which I can drop Collision.
__________________
Retired in late 2008 at age 45. Cashed in company stock, bought a lot of shares in a big bond fund and am living nicely off its dividends. IRA, SS, and a pension await me at age 60 and later. No kids, no debts.
"I want my money working for me instead of me working for my money!"
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01-23-2014, 05:04 AM
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#15
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Full time employment: Posting here.
Join Date: May 2007
Posts: 883
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Quote:
Originally Posted by pb4uski
I would check to see what the dental coverage covered if those two crowns become a reality. As I recall, the coverage under our dental plan was pretty skimpy - in fact so skimpy that it wasn't worth keeping so I self insure. If it is worth keeping, then keep it, have the crowns done and then consider dropping dental and self insuring.
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+1 When I retired from megacorp & lost their dental insurance, my dentist advised me that self-insuring would likely be less expensive than purchasing my own plan.
__________________
"It is better to have a permanent income than to be fascinating". Oscar Wilde
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01-23-2014, 07:29 AM
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#16
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Recycles dryer sheets
Join Date: Sep 2012
Location: in the sticks
Posts: 473
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One thing to consider on your auto insurance - a while back I dropped to liability coverage only as the loan on the vehicle I was driving was paid off. What happened, and what I had not considered, was that I was involved in a hit and run (other party ran) and it left me footing the bill for the vehicle repairs.
Lesson learned. I am not just responsible for my actions, I am still responsible for the actions of the unscrupulous.
Also I just found out that my bank offers an AD&D policy of $30k for free when a member of their preferred club (requires min balance of course). Also free credit monitoring. These are things that I never paid attention to before, but when you open your eyes and have the time to start looking, there is a lot of low hanging fruit out there.
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01-23-2014, 07:41 AM
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#17
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2009
Posts: 6,695
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Quote:
Originally Posted by Newventurer
One thing to consider on your auto insurance - a while back I dropped to liability coverage only as the loan on the vehicle I was driving was paid off. What happened, and what I had not considered, was that I was involved in a hit and run (other party ran) and it left me footing the bill for the vehicle repairs.
Lesson learned. I am not just responsible for my actions, I am still responsible for the actions of the unscrupulous.
Also I just found out that my bank offers an AD&D policy of $30k for free when a member of their preferred club (requires min balance of course). Also free credit monitoring. These are things that I never paid attention to before, but when you open your eyes and have the time to start looking, there is a lot of low hanging fruit out there.
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There is an obscure liability coverage called Uninsured Motorists Property Damage which can protect your car from hit-and-run accidents and from damage to your car from uninsured drivers (the way UM Bodily Injury protects you yourself from injuries due to uninsured drivers). However, this coverage is not available in all U.S. states so you might not have had the chance to buy it once you dropped collision. UMPD is pretty cheap because of its limited nature so it would be worth it to include in your policy.
Edit: I see you live in Texas, a state which does allow UMPD to be sold.
__________________
Retired in late 2008 at age 45. Cashed in company stock, bought a lot of shares in a big bond fund and am living nicely off its dividends. IRA, SS, and a pension await me at age 60 and later. No kids, no debts.
"I want my money working for me instead of me working for my money!"
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01-23-2014, 07:46 AM
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#18
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Moderator
Join Date: Dec 2007
Location: Eastern WV Panhandle
Posts: 25,340
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Quote:
Originally Posted by Newventurer
One thing to consider on your auto insurance - a while back I dropped to liability coverage only as the loan on the vehicle I was driving was paid off. What happened, and what I had not considered, was that I was involved in a hit and run (other party ran) and it left me footing the bill for the vehicle repairs.
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Does your company not offer uninsured/underinsured motorist coverage? We've always had that - it covers that situation and if there are injuries to you it covers what the other driver's insurance would have covered had they been properly insured. That includes loss of income if you can't work, damage to your car, and your medical costs among others.
Uninsured drivers are somewhat of an issue in WV because DMV only checks coverage once a year when the tags are issued or renewed. So the dirtballs pay one month's premium and then let the policy lapse.
MD is a bit better in that state law required insurance companies to notify the MVA when a policy lapses and they send a nastygram to the owner saying "Send in either the tags or proof of insurance". The problem they don't actually dispatch anyone to snatch the tags but only "flag" it in records so if the police stop the car they will impound the car and send in the tags.
__________________
When I was a kid I wanted to be older. This is not what I expected.
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01-23-2014, 08:11 AM
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#19
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Recycles dryer sheets
Join Date: Aug 2005
Posts: 380
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You can save a few bucks on your car insurance by dropping the medical coverage. As long as you have your own health insurance, your auto medical is duplicate coverage. You won't be allowed to collect from both. This also applies to PIP coverage if you are no longer working. Some states don't allow PIP, so check your policy.
__________________
Retired -- 2001
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01-23-2014, 08:35 AM
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#20
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: May 2009
Posts: 9,343
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Quote:
Originally Posted by Walt34
Does your company not offer uninsured/underinsured motorist coverage? We've always had that - it covers that situation and if there are injuries to you it covers what the other driver's insurance would have covered had they been properly insured. That includes loss of income if you can't work, damage to your car, and your medical costs among others. Uninsured drivers are somewhat of an issue in WV because DMV only checks coverage once a year when the tags are issued or renewed. So the dirtballs pay one month's premium and then let the policy lapse. MD is a bit better in that state law required insurance companies to notify the MVA when a policy lapses and they send a nastygram to the owner saying "Send in either the tags or proof of insurance". The problem they don't actually dispatch anyone to snatch the tags but only "flag" it in records so if the police stop the car they will impound the car and send in the tags.
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The "dirt balls" can play that trick here too. I have fortunate not to have had this experience, but a few friends have. And try getting blood out of a turnip. Reinstitution of the stockades with a few strategically placed whip lashings would serve as a reminder to keep policy in force.
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