Do you know your insurance score? Most people don’t even realize they have one until they receive an “adverse-action” notice in the mail notifying them that, based on their insurance score, they don’t qualify for the lowest pricing available from their insurance provider.
The adventure begins by following the letter’s instructions to call the listed 1-800 number to receive a free copy of your credit report – which apparently has some effect on the score. You may wait several weeks for a reply, only to be sent a consent form that reads like an identity thief’s dream: the form will request detailed proof of identification, including photocopies of your driver’s license, in addition to your social security number and your insurance information.
If after gathering all of that information you are brave enough to send it off through the mail, the packet that you get back will simply summarize your credit rating, with absolutely no information about your insurance score.
If you persist and contact your insurance company, it will likely tell you that 99% of its clients do not qualify for the company’s lowest rate, and to qualify, your credit must be absolutely perfect. In other words, even if you carry no balances on your credit cards, own your home free and clear, are completely debt free and have a credit rating in the high 700s, you’re still unlikely to have an insurance score that qualifies you for the lowest available insurance rate. So what exactly is this mysterious insurance score, and what exactly is its reason and purpose?
A perfect insurance score, in the eyes of an insurance company, represents a client with the lowest possible risk of filing a claim, so – since the probability of filing a claim is based on credit – good credit is the key to a high score. A good credit report can have such a large impact on your insurance premium that you can, for example, have a flawed driving record but good credit and pay less for your car insurance than a driver who has a perfect driving record but bad credit. Do keep in mind, however, that your insurance score is not the only factor that determines your premium (you can ask your insurer for more details on what the other factors are).
Even after finding out about an imperfect insurance score, you may find the effort needed to perfect it is not worth what may amount to relatively small savings in premiums. (Remember, your insurance score is not the sole impact on your premium.)
The use of credit history to determine insurance premiums is quite alarming to many consumers, particularly to those who have never filed an insurance claim but still don’t qualify for the lowest available pricing. Unfortunately, insurance scoring is a standard practice among the ranks of the nation’s largest insurers.
With that in mind, the best way to help keep your insurance premium low is to keep your credit score high. Take the same amount of caution with your credit score as you would with your driving – being responsible with both can save you serious amounts of money in insurance premiums.
A home is robbed every 14.6 seconds and the average dollar loss per burglary is $2,119, according to statistics released by the Federal Bureau of Investigation. This statistic doesn’t help anyone’s homeowner insurance rates.
Sure you lock your doors and windows when you’re not home (you’d be surprised how many people don’t). But here are ten things you’re probably doing that make your home a target, and what you should do instead:
- Leaving your garage door open or unlocked. Once inside the garage, a burglar can use any tools you haven’t locked away to break into your home, out of sight of the neighbors. Interior doors between the garage and your home often aren’t as strong as exterior doors and may not have deadbolt locks.
Instead: Always close and lock the garage door. Consider getting a garage-door opener with random codes that automatically reset.
. - Storing ladders outdoors or in unlocked sheds. Burglars can use them to reach the roof and unprotected upper floor windows.
Instead: Keep ladders under lock and key.
. - Hiding spare keys. Burglars know about fake rocks and leprechaun statues and will check under doormats, in mailboxes, and over doorways.
Instead: Give a spare set to a neighbor or family member.
. - Letting landscaping get overgrown. Tall hedges and shrubs near the house create hiding spots for burglars who may even use overhanging branches to climb onto your roof.
Instead: Trim any bushes and trees around your home.
. - Keeping your house in the dark. Like overgrown landscaping, poor exterior lighting creates shadows in which burglars can work unobserved.
Instead: Replace burned out bulbs promptly, add lighting where needed, and consider putting fixtures on motion sensors or light sensors so that they go on automatically.
. - Relying on silent alarm systems. Everyone hates noisy alarms, especially burglars. Smart thieves know that it can take as long as 10 to 20 minutes for the alarm company or cops to show up after an alarm has been tripped.
Instead: Have both silent and audible alarms.
. - Not securing sliding doors. These often make tempting and easy targets for burglars.
Instead: When you’re out, put a dowel down in the channel, so the door can’t be opened wide enough for a person to get through.
. - Relying on your dog to scare away burglars. While barking my deter amateurs, serious burglars know that dogs may back away from someone wielding a weapon, or get chummy if offered a treat laced with a tranquilizer.
Instead: Make your home look occupied by using timers to turn lights, radios, and TVs on and off in random patterns.
. - Leaving “goody” boxes by the curb. Nothing screams “I just got a brand new flat-screen, stereo, or other big-ticket item” louder than boxes by the curb with your garbage cans.
Instead: Break down big boxes into small pieces and bundle them together so you can’t tell what was inside.
. - Posting vacation photos or where you are on Facebook. Burglars troll social media sites looking for targets.
Instead: Wait until you get back before sharing vacation details or make sure your security settings only allow trusted “friends” to see what you’re up to.
Have any other burglary prevention tips you can share? We’d love to hear them. Just use the comment link below to add your tips.
The House of Representatives passed yet another short-term re-authorization of the National Flood Insurance Program. The most recent extension will keep the program going through November 18. This is just the most recent in a series of short-term extensions to the NFIP. Apparently there are legislative efforts to extend the program for the next five years.
No bank will lend on a property in a flood-prone area without flood insurance. So when the NFIP lapses (as it did last year), it makes it nearly impossible to sell a home in a flood area, and any scheduled sales are held up due to the lack of insurance. Regardless of whether it makes sense for the government to encourage people to build homes in a potential flood zone is a separate issue, because these houses already exist and are dependent upon the NFP. This is the system we are largely stuck with.
In light of this, some groups, such as the National Association of Realtors (NAR), are advocating for a long term extension of the NFIP. In a press release, the NAR stated that “the NAR strongly supports the NFIP and believes that a 5-year extension of the program’s authority to issue flood insurance is essential to a properly functioning real estate market”.
There really is no excuse for Congress not to extend the NFIP as the many real estate transactions are utterly dependent upon it. Since 2002, the program has been allowed to lapse 11 times, and then retroactively re-authorized.
Thanks to high costs and rising unemployment, nearly 50 million Americans are going without health insurance…
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Having insurance to protect your stuff may not be enough. There’s one more thing you have to do.
Have you done what it takes to make sure your insurance company will pay up in the event of a disaster? We’d love to hear your comments. Just click the comment link below and tell us… yes, or no? Are you prepared?