Whether buying home or auto insurance, people can make mistakes that could ultimately affect their policy and eligible coverage. The Good Hands Advice team has spoken with its Sales team to explain three common mistakes people make when purchasing insurance.
Who’s Driving the Vehicle?
If you’re the primary driver of your vehicle and there are other licensed drivers in the house who will have access to your vehicle, you must inform your insurance agent. Insured drivers may assume that their car insurance will transfer to anyone who drives it, but that isn’t the case. Though you may “save” money on your premium by not adding any additional drivers, failing to disclose that information is fraud and may result in your claim potentially being denied, your policy being terminated, and you may be held personally liable for any damages you caused.
Who needs to be added?
If there’s someone in your home that is a licensed driver and may use your car, they need to be included. If someone is only taking your car for a short period of time (i.e., a few days) they don’t need to be added as an operator.
When it comes to auto insurance many agents would advise their customer that “if you lend your car, you lend your insurance.” Meaning you’re able to lend your car to anyone you choose but ultimately, they are driving around with your insurance and their actions will impact your coverage if something happens.
While you may be held personally liable for any damages you cause, as the owner of the car, you may also be held legally liable even if the damages were caused by another licensed operator, and they weren’t disclosed to your insurance provider. This would also apply if you allowed your friend to borrow your car and they had an accident; chances are the owner of the car would be named.
Changes in and Around the House
Like your auto policy, it’s important to disclose to your agent how many people are living in your home as well as any renovations that were made. You may question why your insurance provider needs to know who’s living in your home, or the upgrade you have invested in, but the answer is quite simple – to ensure you, your occupants, belongings, and property are protected.
If you’re renting a room or basement to an individual, it is important to disclose that information to your insurance provider as renting your home requires a Residential Fire Policy. This legal liability coverage may extend from your home policy. It may protect you if you’re held legally liable for injury or death to someone on your property. It’s also recommended that you inform your tenants to inquire about tenant insurance. However, speak with your insurance agent to learn what terms and conditions are required to cover a home that will be rented to tenants.
When you bind your home policy, you’ve disclosed to your insurance provider what structures and appliances are in the home to be covered. However, any new renovations made to the home after it was set-up may not be covered under your existing policy. Your insurance provides protection up to a certain amount; if the renovations made to your home increases its value beyond what’s described in your policy, you may not be covered for the full value of your home. Be sure to review your policy with your insurance agent to ensure you have a full understanding of your coverage options.
Also, you may be eligible for certain discounts if you make any changes to your home – e.g., installing a home security system or installing a water leak detection system.
Where Do You Live?
As you may be aware, where you live will have an impact on what you pay for your home or auto insurance. If you live in an area where your insurance rates are slightly higher than other areas, you may feel inclined to misrepresent where you live to “save” on your premiums. However, if you provide false or inaccurate information to your insurance company you may be faced with the following penalties: denial of future renewal with your insurance company, your policy being cancelled, your claim being denied, increase in premiums, or legal actions.
Always be open and honest with your insurance agent. There are many steps you can take to save money or reduce costs for your auto insurance. For example, as an Allstate customer, you could be eligible for these discounts*:
- Drivewise – By monitoring your driving habits for six months, the Drivewise app could reward you with up to 30% off your annual premium. It is free to use and will not increase your premium. In fact, you can save money simply by enrolling.
- Bundling – If you bundle your home and auto, or multiple cars, together on one policy you may qualify for a multi-line discount.
- Vehicle Safety Discount – If you live in Ontario, Alberta, or Nova Scotia, and your car has Advanced Driver Assistance Systems, such as forward collision mitigation, lane departure mitigation, etc. you may be eligible for a discount. If you live in Quebec and your vehicle is equipped with an anti-theft tracking device or vehicle marking, you could get a discount on your insurance.
- Customer Loyalty – In New Brunswick, Alberta, and Ontario if you have been a customer with Allstate for more than three years you may qualify for this discount.
For more discount options be sure to visit allstate.ca
*Terms and conditions apply. This contains information on discounts offered by Allstate but does not list all of the conditions and exclusions which may apply. The wording of the actual policy and local law will govern.
Disclaimer: This information has been provided for your convenience only and should not be construed as providing legal or insurance advice.