Rental Car Insurance Considerations

RENTAL CAR
When it comes to renting vehicles for business use, it’s important to understand your coverage options to smooth out any surprise bumps in the road. Since coverage varies from one rental agency to the next, it’s important to know the risks and how to protect against them.

For years, we have been advising our clients to purchase hired car physical damage on their business auto policy and to reject the “insurance” offered when you rent a car. Since hired car physical damage covers rented vehicles the same as it would an owned vehicle, why pay more for loss damage waiver (LDW) or a collision damage waiver (CDW)? Because rental agreements have evolved in recent years and possibly create pitfalls for auto renters.

About Your Business Auto Policy

If you are relying on your hired car physical damage on your business auto policy to protect you, but the vehicle isn’t rented by the business, the hired car physical damage coverage won’t respond to claims. Your employees should use the business name on the agreement and pay with a business credit card, if possible.

Each year, the liabilities assumed under rental agreements expand. At one time, renters were responsible only for actual damage to or theft of the vehicle. Over the years, the rental car companies added loss of use. As a result, if the car is in the shop for two weeks after an accident, you, the renter, are liable for the revenue the rental car company has lost. Plus, storage fees may be passed on to you. In addition, some agreements require that you pay for “diminution of value.” This is the reduction in resale value for a vehicle that has been in an accident. If you purchase the LDW or CDW offered by the car rental company, your responsibility for damages will be waived.

About Rental Insurance

Should you use coverage from the rental car company and remove the hired car physical damage from your business auto policy? This would be a good solution if you could rely on the rental car coverage. Unfortunately, there are provisions in every rental contract that can void the coverage. For example, coverage is often voided if the driver has a single drink before driving; if he asks someone to drive in his place and that person is not listed as an authorized driver; if the driver is under the age specified in the rental contract; or if the car is taken on unpaved roads. Unfortunately, there are many ways to void the LDW/CDW, and they vary from one agreement to the next.

About Personal Auto Policies

Some personal auto policies won’t cover an SUV, van, or pickup being used for business. Plus, a personal auto policy won’t cover if the employee doesn’t carry comprehensive and collision—a likely case if the employee drives an older vehicle. Some policies exclude loss of use and all exclude diminution of value. And, if the personal auto policy does pay the claim, it will be on the driver’s loss record and might result in cancellation of coverage.

About Credit Card Coverage

Will the credit card used to rent the vehicle pay for the loss if your insurance doesn’t? To activate coverage, the cardholder must be the primary renter and must decline the LDW/CDW. Nothing is standard with credit card coverage, and it may be changed from time to time at the credit card company’s discretion. Also, if you violate any terms of the rental agreement, the credit card coverage is voided when you need it most. Many credit cards exclude rented SUVs, and some exclude any weather-related damage, like flood and hail.

Minimizing the Risk

What should you do to minimize your risk? We recommend the following:

  • Dealing with one corporate-approved rental company, if possible. This will establish that the rentals are for business use and that the business is renting the vehicle, not the employee. Review the contracts of at least three rental car companies and choose the one that best suits you. Make sure to sign a blanket agreement for all rentals and keep a copy on file.
  • Taking the LDW/CDW coverage, or self-insure any exposures not covered by hired car physical damage. Such exposures typically include loss of use, diminution of value, storage fees, administration and claims expenses. Some loss of use may be provided by your Business Auto policy. Ask us to review this for you. Depending on how often your firm rents vehicles and the cost of LDW/CDW, self-insuring might be a good option.
  • If you purchase LDW/CDW, make your employees understand the “Prohibited Uses” or other section that explains actions that will void coverage, even though you paid for it.
  • Continue to carry hired car physical damage on your business auto policy.

Proper Planning is No Accident

Car rental insurance has important considerations. If you need help sorting through this coverage with an expert who understands your needs, call us today at 1-800-237-1378.

 

New Study Shows Homeowners 50+ are delaying…

Study shows homeowners 50+ are delaying home repairs..

New research from The Hartford and MIT shows that 49% of homeowners who are 50 years and older are delaying important home repairs. This percentage grows as homeowners reach 70 years and older. Fire, water, pests and weather are causes of the most significant damages to homes. According the AARP homeowners insurance for The Hartford, water damage from heating, plumbing and air conditioning are the most common cause for insurance claims, followed by wind damage. Shockingly, of those who were interviewed for this survey, only 16% believe that water leaks could cause serious damage. Putting off home repairs could also cause claims to be denied if you had prior knowledge of damage. Don’t delay in repairs, a small leak could cause a flood!

Where’s George?

Anastasi Insurance is excited to announce our new objective Where’s George? Where we highlight local businesses and promote their success. Check out our FIRST episode below, Manthorne Automotive!

Stay tuned for Episode 2..coming soon!

See a dog in a hot car? Do you know what to do next?

As we approach warm weather (finally) – we want to remind you that it is never safe to leave your dogs in the car. According to PETA, on a 78* day, your car’s interior temperature can reach over 100* in a matter of minutes.

Check out this video by Veterinarian, Dr. Ernie Ward – who shows you what happens when you leave your animal in the car – even if you leave the windows open and park in the shade.

But what if you do see an animal in a hot car?

In August 2016, Massachusetts Gov. Charlie Baker signed a  new law for animal welfare gives pets more protections from extreme heat and weather. St. 2016, c. 248 An Act Preventing Animal Suffering And Death was signed in a ceremony by Governor Charlie Baker.

This law gives a bystander and first responders the right to enter the vehicle if they feel the animal is in danger due to extreme weather. If you believe an animal is in danger take the following steps before you attempt other means to enter the vehicle:

  1. Call 911
  2. Check to see if the doors are unlocked
  3. Make an effort to locate the owner

 

At Anastasi Insurance Agency Inc, our pets are part of our family and we do everything we can to protect them.

Only 50% of small business owners are completing this important yearly task….

The 2018 Small Business Risk Report by The Hanover Insurance Group found that only half of all small business owners are reviewing their commercial insurance policies each year. 
“With risks evolving and becoming more complex, it’s more important than ever for small business owners to evaluate their insurance needs to help ensure they are properly protected,” said Michael R. Keane, president of core commercial at The Hanover. 

The three biggest concerns for small business owners are data breaches, loss of employees and business interruption. but only 21% made adjustments to their policy if advised by their agent. As risks like cyber, employment practices liability and crime exposures, increase, it is important for you to make sure you and your agent discuss your policy every year and increase/change your coverage as needed. At Anastasi Insurance Agency, we provide expert counsel to help assess small business owners’ risks, identify solutions and guide them through the insurance buying process. We make sure that our insured’s are not apart of the 67% who don’t feel that they have adequate coverage..

Risk Retention Groups: The Silver Lining For Increasing Insurance Cost

It is no secret that commercial auto insurance rates have been increasing. It is not uncommon to see a commercial auto insurance renewal increase 4-8%. Put into the mix adverse loss experience and you will likely experience a double digit increase.

The Trucking industry has been especially hard hit. As the demand for insurance coverage increases in this robust economy supply/demand, economics come in to play and the increase in auto liability premiums is likely to remain for the immediate future.

But with every cloud there may be a silver lining. These premium increases have brought about a resurgence of Risk Retention Groups (RRG). In no way is this a panacea to increasing premiums but for some Truckers may provide a viable alternative to traditional insurance coverage.

A Risk Retention Group is an insurance company formed pursuant to the federal Risk Retention Act of 1981, which was amended in 1986 to allow insurers underwriting all types of liability risks except workers compensation to avoid cumbersome multi-state licensing laws.

A Risk Retention Group (RRG) is a liability insurance company that is owned by the people it insures. The owner-insured of a Risk Retention Group must share similar business activities. There are a number of options for Trucking companies, from owner operators to those R|PGs that require a minimum fleet size of a 100 power units.

Joining a RRG not only makes you an insured but also an owner of this insurance enterprise. In some cases it requires a surplus contribution, which can be considered an equity investment into the insurance company. Most RRGs require a surplus contribution. Many plans  will allow a payment plan for this contribution in addition to the premium payment.

The desired outcome of the RRG is to bring together a homogeneous group of insureds that have a vested interest in reducing claims severity and frequency through the engagement of loss control and industry best practices. The RRG is  very active in encouraging risk management techniques that will assist the insured/owner in improving its loss record. In most cases these efforts will reduce the overall cost of insurance.

Please feel free to contact me for more information regarding these alternative methods of protecting your business.

6 Ways to Prevent Cargo Theft

Unfortunately, Cargo Theft presents a considerable problem in the shipping industry. Goods are the most vulnerable when in transit. Next to having the correct coverages for your drivers and loads, following these 6 tips, can help ensure that your driver and load will be delivered safely.


    1. Planning your Routes: If you transporting to the same location and take the same route regularly – you are a target for thieves. Make sure to switch up your routes every now and then.
    2. Keep eyes on the goods at all times: If you are driving alone, always make sure you are close to your truck at all times.
    3. Add extra security: There is no better deterrent for thieves then anti-theft devices. Invest in items such as locking bars and king pin locks.
    4. Secrets: It is proven that thieves target certain loads over others, so the golden rule is don’t discuss what you are hauling.
    5. Constant Contact: The dispatcher and driver should remain in constant contact throughout the trip. In addition to dispatch, keep in contact with friends and family so they know you are safe.
    6. Know what to do if you are targeted: If you are targeted by thieves, always remember your safety comes first. Try to remember as much detail as you can in order to give the authorities the best chance at catching the criminals.
At Anastasi Insurance, we take safety beyond just providing you with the correct coverages for the right price. We can help you develop safety talking points and documents to use with your employees and more. Contact us today.

Glitch in RMV system

Did you get a notice from the MA RMV that your license will be suspending due to outstanding fees? You may have been one of the almost 10,000 people who received this notice due to a glitch in their system. The RMV did send out correction letters within 24 hours after they caught the glitch, but if you have any questions about the status of your license, please feel free to give us a call and we can check on that for you.

Home Inventory Checklist

When was the last time you updated your home inventory? Even if you have good insurance, your policy can only pay you for personal belongings if you can document them and prove they were lost, damaged or destroyed. This may seem like a time-consuming project, but our team can make it quick and easy. Contact us and ask about our comprehensive Home Inventory Checklist today.

What does the rate decrease mean for your Workers’ Compensation cost?

Massachusetts settled on an impending decrease in workers’ compensation rates – effective July 1, 2018. The decrease will result in an average rate rollback of 12.9% on workers’ comp insurance rates. Unfortunately, this won’t be a simple decrease in every employer’s premium. There are a lot of factors to consider. Our President, Paul M. Anastasi sat down with Jon Coppleman, our resident Workers Compensation consultant, to discuss the rate decrease and what it could mean for your business.

It is important to discuss the impacts to your particular situation with your agent. If you have any questions on your workers compensation policy, please contact our office.