What if? Those two words begin many conversations with clients when they are thinking about trading vehicles and want to know the difference in premiums. It is such a common request that our computer system provides a function key for those “what ifs.”
It is easier to understand how insurance works if you have a particular consequence in mind and ask a question about the answer. It works a little bit like the quiz show, Jeopardy, where the answer is given and the trick is to provide the question. Test yourself:
Answer: A citation is given for not being able to show this when stopped by police in traffic or at the scene of an accident.
Question: What is a proof-of-insurance card?
Answer: Driving too fast for conditions.
Question: What does your insurance company call sliding off the road in a snow or ice storm?
Answer: Sliding off the road in snow or ice and hitting a tree.
Question: What is an example of an at-fault accident?
It doesn’t matter which way you inquire about your policy. Please do it, though, because it is one of the benefits of buying insurance from a live person.
What if I borrow a friend’s car and cause an accident with damages and injuries? Your friend’s insurance will be primary in this situation, as long as the vehicle is insured and you were given permission. Your insurance might be used as excess coverage if the friend’s liability coverage is lower than the damages. If there is no insurance on the vehicle at the time of the accident, the insurance that you (the borrower) carry on your vehicle will cover the damages and liability. There will be a big problem, however, if you didn’t ask permission, or if neither of you have insurance.
This one is hard to keep straight: What if I run into my garage with my car? Your homeowner policy covers damage to the garage and your auto policy takes care of the damage to the car.
What if my car is parked in my garage and it is destroyed by a fire? If the car has comprehensive coverage, your car insurance will pay; if not, there is no coverage, as vehicles are excluded from coverage on the homeowner policy.
The definition of jeopardy is “danger” or “peril”—one of the primary reasons for insurance. Take it from me; interpreting a policy can be as difficult as selling one.
I just can’t resist:
Final Jeopardy Answer: The person to call when overcome with “What ifs.”
Question: Who is your insurance agent?