Frequently Asked Questions
Below are some of our frequently asked questions. If you have any other
questions or concerns, please feel free to contact us.
- Does C.T. Lowndes & Company provide insurance for homes located on the beaches and barrier island?
- What happens if I let my auto insurance lapse?
- What are the state minimum requirements for auto insurance?
- Should I get property insurance even if I am renting?
- What would be a good deductible to keep my home owner's insurance premium low but enough coverage in case I do have a claim?
- Can I have my home owner's insurance paid with my house payment?
- What is the Wind Pool and why do I need this type of coverage?
- If my personal property gets damaged by water during a hurricane, will my regular homeowner's or renter's insurance cover me?
- If I do have a claim, does it make my insurance premiums go up after I submit the claim?
- Do I get any discounts if I pay my bill electronically?
- How does the Biggert Water Flood Insurance Reform Act of 2012 (BW12) affect me?
- If a hurricane is approaching, can I still purchase home owner's/renter's insurance?
- Shoud I Purchase the Rental Car Damage Waiver?
Does C.T. Lowndes & Company provide insurance for homes located on the beaches and barrier island?
Yes, there are many insurance companies writing insurance on homes located on the local beaches and in other coastal areas. We can insure primary residences, secondary residences, and rental homes and provide quotes with several companies to make sure you are getting the best premium. We certainly include the wind insurance on our quotes. Our agency does write flood insurance through the National Flood Insurance Program and can answer your questions about this very complex Federal insurance program.Back to TopWhat happens if I let my auto insurance lapse?First, you should understand that there is no “grace period”. If your policy expires on May 1, for example, and you have not paid the premium, you have no coverage as of 12:01 AM on May 1. That is one minute after midnight!
If you have an accident at 7:15AM on May 1 while driving to work, you are not insured and would be in violation of state law, as SC law requires all vehicles to be insured while being operated on a public road.
If you let your policy lapse, your insurance company will notify the SC Department of Motor Vehicles and you will be fined $5 for each day you have no insurance (unless you turn in your license tags).Back to TopWhat are the state minimum requirements for auto insurance?$25,000/$50,000 for bodily injury liability and $25,000 for property damage liability, commonly written as $25/50/25. Ask you agent what the premium would be for the next higher limit, like $50/100/50. You may be able to double your limits for only a few dollars.Back to TopShould I get property insurance even if I am renting?Yes. A fire can occur in any dwelling, apartment, or condominium. Other losses can occur as well. Without a renters (HO-4) policy, you would be in the position of losing all your possessions and having no financial help to replace your lost items. In addition, everyone needs to have the liability insurance afforded by a renters policy.Back to TopWhat would be a good deductible to keep my home owner's insurance premium low but enough coverage in case I do have a claim?A $500 deductible is
fairly common although many people have a $1,000 deductible or higher. Most
companies offer higher deductibles such as $1,000, $2500, and $5,000. My rule
of thumb is that you should be able to recoup the deductible difference by the
savings in premium in no more than 5 years. For example, you are considering
changing your deductible from $500 to $1,000. That is a difference of $500. The
annual premium would need to be reduced by at least $100, thus saving you $500
over the 5 year period.Back to TopCan I have my home owner's insurance paid with my house payment?In most cases, yes. This is called escrowing. You would need to discuss this with your mortgage company.Back to TopWhat is the Wind Pool and why do I need this type of coverage?In the 1970s, many insurance companies refused to provide wind insurance on beach properties due to potentially large hurricane losses. The state thus created the South Carolina Wind & Hail Underwriting Association (Wind Pool) to make wind insurance available for those unable to purchase it on the open market. We do live in an area frequented by hurricanes so all properties should be insured against the peril of wind.Back to TopIf my personal property gets damaged by water during a hurricane, will my regular homeowner's or renter's insurance cover me?Tough question as the answer depends on where the water came from. If the water is from rising water like a hurricane or storm surge or heavy rain water accumulating, the answer is no. You would need a flood policy in order to have coverage. The key here is the term “rising”. You must have the separate flood policy to have coverage for “rising water”.
If your roof is damaged by wind and rainwater comes in via the opening caused by the wind, yes, you do have coverage under your homeowners/renters policy (assuming the policy includes wind insurance).Back to TopIf I do have a claim, does it make my insurance premiums go up after I submit the claim?On auto policies, the
answer is yes in most cases. On other type policies, the answer varies
considerably. Insurance companies take different approaches to claims on
homeowners policy, for instance. One claim with some companies does not affect
your premium. With other companies, your premium may increase. Act of God type
claims (lightning, wind, etc.) are looked at differently than negligence type
claims or claims resulting from a lack of “pride of ownership”. It is always
best to ask your agent about your insurance company.Back to TopDo I get any discounts if I pay my bill electronically?Many companies give a
discount if you make monthly payments using the Electronic Funds Transfer
method. Most companies do not give a discount for a one time EFT payment.Back to TopHow does the Biggert Water Flood Insurance Reform Act of 2012 (BW12) affect me?Now this is a really
tough question! Keep in mind that Congress created the Act and as such the Act
is very complex and has had some serious unintended consequences for certain
property owners. We could not possibly explain the Act here but would
refer you to www.fema.gov/national-flood-insurance-progam for
full information. You can read a short summary at our blog on this website .Back to TopIf a hurricane is approaching, can I still purchase home owner's/renter's insurance?Most insurance companies cease binding insurance when a tropical storm/hurricane watch or warning is issued for your area. However, if the storm is a big one, the companies may stop issuing new policies much sooner, even several days earlier.Back to TopShoud I Purchase the Rental Car Damage Waiver?
“Top 10 Reasons to Purchase the Rental Car Damage Waiver”
Abstract: Although most damage waiver fees are considered outrageous, the insured is best advised to purchase the waiver for short-term rentals. This is not only in the best interest of the insured, but also the agent since an inadequately covered loss may result in the loss of an account or worse, an E&O claim.
Although most collision damage waiver (CDW) or loss damage waiver (LDW) fees are considered by many to be outrageous if not unconscionable, consumers are best advised to purchase the CDW/LDW when renting an auto. These waivers may protect you against thousands of dollars in charges not coverage by your auto policy. Since your auto policy will likely cover things the rental agreement waiver won’t, having both is advisable. With that said, here are ten reasons to purchase the CDW/LDW:
1. Loss Valuation
The value of a rental car, according to virtually all rental agreements, is determined solely at the discretion of the rental company and may be significantly different from the "actual cash value without betterment" basis used by most auto policies.
2. Loss Settlement
If there is a disagreement on the value of the damage, your auto insurer may invoke the “appraisal” clause in your auto policy which can have a cost to you associated with it. In addition, most auto policies grant the insurance company the right to inspect and appraise damaged property before it is repaired or disposed of. Since the rental company may not wait for this, the insurance company might legally deny the claim or limit the coverage.
3. Loss Payment
The rental agreement may require immediate reimbursement for damages and it is not uncommon for the rental company to charge the renter’s credit card. This can create a significant debt, "max" out the card's credit limit (perhaps shortening a vacation or business trip), result in litigation, etc.
4. Loss Damage Waivers (LDW)
At one time, renters were responsible only for collision damage to rental cars so you could buy a Collision Damage Waiver. Today most rental agreements make the renter responsible for ANY "loss" other than normal wear and tear regardless of fault and offer a Loss Damage Waiver. Typically you must have physical damage coverage on your auto policy for damage waivers to apply at all. Even so, you may be responsible for losses not covered by your auto policy. Similarly, your auto policy may cover losses not covered by the LDW such as operation by drivers not listed on the rental agreement. Thus, there is a need for both policies and waivers.
5. Indirect Losses
Rental car agreements usually make you responsible not only for damage to the car, but also for the loss of rental income while the vehicle is being repaired or replaced, even if the rental company has unused autos sitting on the lot. We have heard of assessments as high as $2,000 for such charges. Many auto policies cover some loss of income but it is usually limited in amount and may be further restricted if the rental company refuses to share their fleet utilization log with the insurer in order to determine a fair loss of income. In addition, if damage is extensive enough, most rental companies will charge for the “diminished value” of the auto, something usually not covered by auto policies. We have seen documented charges of $5,000 and $8,000, and heard of one that was allegedly $15,000 on an upscale SUV rental.
6. Administrative Expenses
The rental contract may make the renter liable for various "administrative" or loss-related expenses such as towing (e.g., one insured was charged for a 230-mile tow), storage, appraisal, claims adjustment, etc. None of these expenses are typically covered by auto policies.
7. Other Insurance
Most auto policies provide excess coverage over other sources of recovery for damages to rental vehicles—damage waivers, travel policies, credit card coverages, etc. Other policies, credit cards, etc. might say that they are excess over your auto policy. The potential controversy over who pays what is obvious and can result in litigation. Often this is governed by state law which is likely to be unknown at the time of rental. While it is unlikely, we have heard of insurance companies refusing to pay for damage to nonowned autos if there is primary insurance coverage on them.
8. Excluded Vehicles & Territories
Most personal auto policies only cover damage to motor vehicles that are private passenger autos, pickup trucks, and vans. In other words, vehicles such as motorcycle and motorhome rentals are typically not covered. Most auto insurance coverage is limited to the U.S., its territories and possessions, Puerto Rico, and Canada, which could present a problem for some rentals. In addition, if the insured is renting a trailer (U-Haul, camper trailer, etc.), auto coverage is typically limited to only $500 - $1,500. The insured usually has no choice but to rely on the rental company's damage waiver for coverage under these circumstances.
9. Excluded Uses & Drivers
Some auto policies do not cover business use of nonowned autos and some do only if it is a private passenger auto. Some policies have driver exclusion endorsements. For such business use or operation by excluded drivers, the only source of recovery might be the rental company LDW. Similarly, the auto policy may cover some drivers not automatically covered by the LDW. A related exposure involves valet parking. Most auto policies will cover you if a rental vehicle is damaged by a hotel or restaurant valet, but you wouldn’t have coverage under most LDWs because the valet is not an authorized operator. So, again, having both auto insurance and the damage waiver may be beneficial in certain circumstances.
10. Additional and/or Future Costs
An auto policy will almost certainly include a deductible in the range of $100-$500 or more that you will have to pay. Perhaps more important, payment for damage to a rental car may result in a significant premium increase (if not nonrenewal) via claim surcharges or loss of credits.
There are two excellent related articles on this subject from the Denver Post that consumers will find very enlightening:
Copyright 1999-2008 by the Independent Insurance Agents & Brokers of America, Inc. All rights reserved.
Original article copyrighted 1998 by the Independent Insurance Agents of Tennessee, Inc. Used with permission.
This consumer article is based on the following Big “I” Virtual University article:
NOTE: Policy coverages and circumstances can change at any time, so the information in this article may not be accurate at the time of reprinting or subsequently to that time. IIABA does not assume and has no responsibility for liability or damage which may result from the use of any of this information. The most current, up to date version of this article can be found at IIABA’s Virtual University at http://www.iiaba.net/VU.Back to Top