Uninsured motorist insurance

[scrabbler1]

In Texas, even though auto insurance is mandatory, it's estimated 25% of the cars have NO insurance. Of the remaining 75%, it's estimated the vast majority of those cars only have the minimum coverage the state requires and fall into the "underinsured" category in case of an accident.

.......

I realize times are hard and most folks are looking for ways to save on the bills. Before you look at cutting coverages on your auto policy, make sure you have all the discounts possible. If your state allows a safe driver discount, take the course. Make sure your car is rated correctly after you retire (changed from "work" to "pleasure") and you update your estimated annual mileage.

While I did not have the chance to review Texas policy limit data in my years of working, I was able to view it for nearly all other states. In the voluntary insurance market, the most common limit from the reasonably large sample of data I reviewed was 100/300 with 250/500 and 50/100 not far behind. Those in the voluntary market rarely bought minimum limits.

In the Assigned Risk market, however, the one for bad drivers and whose rates are generally at least twice those in the voluntary market, the lowest limit (FR) was by far the most common, and understandably so. But the A/R market is not a big part of the overall insurance market (it depends on the state, of course).

So for you to say, "the vast majority of those cars only have minimum coverage..." if you are referring to the overall insurance market makes no sense to me as someone who reviewed policy limt data for more than 20 years.

That being said, having a sufficient amount of UIM insurance coverage is a good idea. UIM, as I mentioned in another post, varies a lot by state not only for rates but for how the coverage works (and I do not recall Texas' rules). Some states it acts like a fill-in coverage between what the at-fault (i.e. other) driver has and what your "comfort level" of coverage is. In other states it acts as an add-on coverage to whatever the other driver has. In a few states it is a hybrid of the two (tough to explain). In the first case, the coverage is relatively cheap while the second case it is more expensive. This is separate from the "stacking" issue which can exist or not exist with either type of payout rule I just described.

Making sure your car (and you as the driver) are properly rated is alwyas a good idea. I recall when I turned 25 my insurance company mistakenly changed my "use" class from pleasure to work, partially offsetting the great savings I had by turning 25. I pointed this out to my agent and he immediately got me rated correctly. Depending on the state you live in, [as you pointed out] you may be able to take a short accident prevention course or defensive driver course (now available on line in many areas) and earn a discount which lasts 3 years. Adding an anti-theft device can save you money on your Comprehensive premium.

 

[73ss454]

I am curious, so please post back, as to how much your health insurance carrier covers for ambulance and MedFlights (I think both are always out of network).

OK, here's what I found out. I spoke with my Health Ins carrier and they said they would cover me for Med Flights and Ambulances with a $35.00 co pay. Both in and out of network.

I also spoke with my Car. Ins company, (Geico). They said that under PIP the max coverage with them is 10K and I get that if I have UIM or not. The opitional Med Pay is availabe and also has a max of 10K pay out so I see no reason to have Med Pay as my Health Ins. carrier covers anything that PIP doesn't.

So as far as I can see there is no need for UIM coverage in my case.

 

[modhatter]

I went on line today to check out MedPay here in Florida. What it said was it only pays 20% of that which PIP does not cover. My policy for only $10,000 of coverage with PIP cost $128.26 per yr. for only $10,000 coverage, and covers up to 80% of medical costs up to $10,000. So in reality here. Buying MedPay here would only fill in the $2,000. Not a biggie.

My UIM runs $362. a year for only $100,000 coverage, whereas my UIM in Arizona for $500,000 is $200 a year (with five times the coverage)
You guys who are paying $40 or $50 for your UIM, I want to move there.

I would not object to paying extra for the UIM coverage, I just think it is way to expensive for the coverage it gives here. I carry max $500,000 IB, and that cost $$365 for six months, which is a lot cheaper than the UIM. Just saying that the ratio of cost vrs. payout stinks so I was wondering if i really needed it.

I got quotes from two other companies, and their UIM is $200 a year cheaper. Problem is, there umbrella policy is four times higher.

I pay only $149 for a million dollar umbrella, when I carry $500,000 on cars, but two other companies have quoted me $570-$650 for the same umbrella policy. (even with switching both cars and residence over to them. So I feel I am being held hostage by not being able to take advantage of lower auto rates from other companies if I want to have umbrella. Anyone out there want to share what they pay extra for a
million $ umbrella?

 

[73ss454]

$320 Via Geico.

 

[East Texas]

Anyone out there want to share what they pay extra for a million $ umbrella?

$127 with USAA.

 

[modhatter]

Funny. One of the quotes I got was from Geico. It was $650 approx.
Covered one house and two cars. I have no accidents, no tickets, no claims.
What have I done wrong?

 

[REWahoo]

$237 for $1M with USAA. $119 for an additional $1M.

 

[modhatter]

Unfortunately, I don't qualify for USAA. Father was in military, but never a member of USAA which is a requirement.

 

[73ss454]

Funny. One of the quotes I got was from Geico. It was $650 approx.
Covered one house and two cars. I have no accidents, no tickets, no claims.
What have I done wrong?

Hmmm, how tall are you?

 

[East Texas]

Unfortunately, I don't qualify for USAA. Father was in military, but never a member of USAA which is a requirement.

If your father is stil alive, and I'm assuming honorably discharged, he's now eligible for USAA insurance. His membership gives you access to membership. Membership means he has to purchase a P&C insurance product.

As our actuary friend will tell you, there are a lot of factors that go into premiums. Location, driving record, claims record, etc. For USAA members, their longevity with the company as well as the number of products (across all product lines) helps with the auto insurace premium. Our annual mileage is low and we take a Defensive Driver (Safe Driver) course every three years.

While I thought our southern-most rattlesnake wrestler had excessively low premiums, I finally pulled out my policy. Let me be very clear about this - rating factors differ significantly from policyholder to policyholder and company to company.

The premiums are for a six month policy. These are rounded premiums per car
$35 $1mil/$1mil Bodily Injury coverage (per person / per accident)
$33 $100k Property Damage
$ 3 $100k MedPay. Yes, that's right. $3 for six months of coverage per car.
$ 9 $100k PIP
$17 $1mil UM/UIM

Collision coverage on the two cars (1996 and 1997) is the killer. I'm seriously thinking about dropping it and putting UMPD on my policy. I'll keep comp on both cars forever.

 

[East Texas]

I made an egregious error on Post 22.

This paragraph has the error:
The first party coverage is the focus of your concern - what do you have to have and why do you have to have it. First party coverages are comprehensive and collision to repair your car, Medical Payments, Personal Injury Protection, Uninsured Motorist, Uninsured Motorist Property Damage, Underinsured Motorist, and Underinsured Motorist Property Damage. The only coverages you MUST have are comp and collision if you have a leinholder on the car. Everything else is optional. Your Umbrella policy does not mandate you have [-]third [/-]first party liability coverages.

I apologize for the error. Maybe one of the moderators would be so kind to slip in there and fix it since the error is a biggie. Please...?

 

[modhatter]

Gosh East Texas. Thanks for your input. Those are terrific prices. Unfortunately my dad is gone. Kind of wish I could raise him up again!
But if you served, you sure deserve some breaks.

I wonder if the military would be interested in a 69 yr. old female.

 

[East Texas]

modhatter, was your dad an officer or enlisted? If an officer, maybe there's a slight chance he established membership a long time ago and you didn't know about it. USAA opened up membership to enlisted and retirees several years ago (there used to be some restrictions).

I hope you got enough information to make an informed decision. Not just from me -several people took time to share first-hand experiences. Good luck to you.

 

[Nords]

modhatter, was your dad an officer or enlisted? If an officer, maybe there's a slight chance he established membership a long time ago and you didn't know about it. USAA opened up membership to enlisted and retirees several years ago (there used to be some restrictions).

Gosh East Texas. Thanks for your input. Those are terrific prices. Unfortunately my dad is gone. Kind of wish I could raise him up again!
But if you served, you sure deserve some breaks.

There's an outside chance that USAA might be able to look up your Dad's Social Security number, see if he was ever on their member rolls, and let you know if you're eligible.
Joining NFCU, PenFed, and USAA (part 2 of 2) | Military Retirement & Financial Independence

I wonder if the military would be interested in a 69 yr. old female.

I can't speak for all branches of the military (and certainly not for the Marines), but in the submarine force it was pretty much directly related to the number of days that the crew had been underway...

Why, yes, as a matter of fact I have discussed that with my daughter!

 

[jazz4cash]

Collision Coverage

Awhile back I elected to skip collision coverage. Our cars were paid off and we had 3 teenage drivers. This has worked out pretty well for us until last October. DD slid off the road into a ditch....damage was moderate. Twenty minutes later an SUV slid off the road into a spot in the ditch that was already occupied by DD's car. Our car was totaled after being hit by the SUV. We had same insurance company as the SUV. They hemmed and hawed and finally decided the settlement would be zero because in MARYLAND financial responsibility is only due to negligence and they decided that there was no negligence becuase of the icy conditions. Thankfully, no one was injured.

Insurance regualtions vary SIGNIFICANTLY from state to state, so find out the details for your particular state. From now on, we'll be carrying collision coverage even on our junkers.

 

[Buckeye]

$237 for $1M with USAA. $119 for an additional $1M.

$350 for the first $1M in the Tampa Bay area in FL. I was told 85% of the claims are related to auto accidents.

 

[modhatter]

Buckeye. Are you also with USSA? Is it covering one or two cars?

 

[Nords]

Well, it's been over a month since I "decided" to look into this further. I must have too much going on in my life, because spouse and I think our whole insurance discussion is moving into "way too hard" territory.

What if you have more retirement assets than you need? You could optimize the excess by:
1. Saving it (self-insuring).
2. Spending it to insure against everything.
3. Blow off most of the catastrophes as vanishingly small odds, and party on.

I believe that some combination of the three is appropriate-- we just can't decide which combination.

For example, medical insurance is #1 & #2. (We have Tricare, but otherwise I'd want a high-deductible catastrophic policy.) Fire insurance? Definitely #2. Flood insurance when you live on top of a hill by a storm drain? #3. Water damage after the hurricane rips off your roof? #2 again. Earthquake insurance when it costs 20% of your home's value per year? Probably #3. (Our house survived a vigorous temblor with only minor cosmetic damage.) Liability? #2 again, and for our gross (not net) worth.

We tend to make decisions by price, not probability. I can't determine our personal odds having an accident, let alone that of needing UIM/UM insurance. We don't expect to need long-term care, either, but most people are scared away by the high expense regardless of the odds. I don't have a clue about liability lawsuits but the insurance is relatively cheap for peace of mind. Everyone wants to say "Thank goodness we had insurance for that!!" but we also have to say "Yep, I've been paying premiums on that insurance for over 50 years... I could've just bought a new one by now."

We're not consistent, either, although we usually go high-deductible or go without. We have no dental insurance. We get the highest possible deductible on fire & hurricane insurance. We don't carry collision or comprehensive on our vehicles. We minimize our own vehicle insurance yet maximize it in case our daughter is crippled by a UIM/UM motorist. She graduates college in May 2014 so we could theoretically end the UIM/UM then.

For us parents, I guess I need to know where Tricare ends and where UIM/UM would pick up. For example if a car accident put me in a coma, at some point Tricare would declare their benefits ended and we'd have to start paying for things ourselves, or have long-term care insurance, or be funded from the UIM/UM insurance claim. However I'd be 100% disabled, too, so I don't know whether the VA would step in to help-- assuming that's a good thing. When we spent down our assets then our surviving spouse would still have the house and their own pension, so neither one of us would be penniless. We'd have "enough".

A good point was made by another poster about state-required medical payments insurance. They'll rebuild your teeth after an accident, and for a lot less money than dental insurance. But what are the odds that your airbag is going to break your jaw and knock out your upper incisors? How much would the surgery cost?

Some answers are easy, while others are changing. No life insurance. We don't need it for our own asset management, and we don't need it for estate planning. We don't carry long-term care insurance. We've been holding off that decision another 5-10 years (until we're 60 years old) hoping that the industry will sort out its issues and that the federal LTC program will still have the pricing power. It's hypothetically possible that we're one of those couples who should [-]euthanize[/-] "self insure" LTC because we each have our own pensions.

The whole #1-#2-#3 debate comes down to what you do with excess money. We "might want to spend it ourselves someday", so it seems frustrating to "waste" it on insuring against low-probability casualties. I think that for us, UM/UIM and LTC are going to fall into the #3 category. LTC probably will too.

I guess the real reason this is "too hard" is because I need to consult the Tricare ombudsman and the VA to determine exactly what our coverage limits are. Those always been confusing phone calls with long hold times...

 

[East Texas]

That's an interesting post, Nords. We make decisions based more on probability than price.

 

[Nords]

That's an interesting post, Nords. We make decisions based more on probability than price.

I would, too, if I knew what the probabilities were.

But the price is pretty straightforward.

 

[Nords]

Hard to believe that over three months have passed.

Well, I finally did something that strikes fear & trembling into the hearts of all U.S. military veterans.

I called the Tricare "customer service" line at Triwest. It actually went a lot better than I expected. I didn't even spend any time on hold, which seems most unusual.

One reason I called is that a neighbor was rear-ended in a car accident which resulted in a visit to the emergency room and some physical therapy. She's fine now, but Tricare denied her claim. It turned out that what Tricare was really asking was for USAA (her vehicle insurance company) to sort out the responsibilities, the medical payments, and the state personal injury coverage before Tricare would pay anything. After everyone else had settled their portion of the claim, Tricare would take care of the rest.

So I asked Tricare: if I was disabled in a vehicle accident caused by the other driver's fault, and I carried no UIM/UM insurance, and the other driver carried no insurance, would Tricare still cover me? What about my family? What about lifetime care if I was a total invalid?

First up was "Michelle" from Benefits, who kept breaking into my sentences to make comforting noises and to reassure me that Tricare would take care of me. The only problem was that she couldn't answer the question. She kept telling me (in between reassurances) that it would be an insurance issue. She kept telling me that the other driver had to have insurance. I kept trying to tell her that the question assumed that no insurance was involved. She kept telling me that I should really have UIM/UM insurance to protect myself. Then she told me I should have long-term care insurance too. This was not comforting.

She finally decided to get rid of me by passing me to Claims. I supported that.

"Debbie" in Claims was all over it. She understood the question but answered it in her own way. In a vehicle accident the insurance companies would sort out their claims first (if applicable). Then the state would step in with personal injury coverage (whatever limit was on the policy). If I didn't have UM/UIM insurance and the other driver didn't have insurance, then USAA (my insurer) would sue the other driver for whatever they could get. (I asked her to assume that would be zero.) Then, if I was disabled enough, Tricare would see if I qualified for Medicare benefits. If so then Medicare would step in and Tricare would be second payer under Tricare For Life. If nobody else was required to pay anything for my lifetime care, then Tricare would step up as the payer of last resort. They'd only pay for medical issues, and frankly it seemed like a fuzzy line between medical expenses and long-term care expenses. Bottom line, however, was that Tricare would pay.

I'm not sure if the Veteran's Administration would get involved, but if I was disabled by this situation then I'd sure be calling them too.

But Tricare's response seems to imply that we could cancel our UIM/UM coverage, which would save us over $220/year.

I'm going to run this by a couple people at USAA as well. Although I probably know the answer if I ask an insurer "Do I need insurance?"

If any of you have any other Tricare or insurance-industry experience, I'd appreciate reading it!