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What is Auto Loan and Lease Gap Coverage?

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Many auto dealers offer low down payment options to sell more vehicles. Vehicles depreciate quickly. Early in the loan term you may owe more money than the vehicle is worth. This can be a serious problem if your vehicle is totaled early in the loan or lease term.

An Example of Loan Gap Coverage

Auto insurance companies pay the “actual cash value” (similar to “book value”) of your vehicle. The value may be less than the amount you owe on the loan or lease. 

Say your dealer offers a sweet  “no money down” incentive on a $32,000 vehicle. You total it 3 months later in a crash. The book value is $28,000, but you owe $31,000 on the loan. The bank comes looking for $3,000. Uh-oh.

Luckily, you bought loan gap coverage. Instead of paying the book value the insurance company pays you the amount you owe. You can start over again with no debt. Not bad, huh?

Some Restrictions Apply

  • Most insurers only sell loan – lease gap coverage in the first few months you own the vehicle.
  • Coverage usually “drops off” after 36 months. By that time, hopefully your loan is no longer “upside down”.
  • Your vehicle has to be a total loss.
  • Of course, you have to buy collision coverage on the vehicle.
  • Loan-lease gap coverage usually costs an additional 6-8% of the physical damage coverage on the vehicle.

Our Maine insurance agency is ready with answers to your personal, business or professional liability insurance questions. For answers, or to get a Maine auto insurance quote, or Contact Noyes Hall & Allen Insurance in South Portland at 207-799-5541.

Remembering Leone G. “Lee” Allen, CPCU

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Ten years ago, Lee Allen, one of the founders of Soule Allen Insurance, passed away. Lee was a true insurance pioneer, a trailblazer and role model for the many women business leaders who followed her. After Soule Allen was sold to Noyes & Chapman, and Blake, Hall & Sprague Insurance combined to form a new business, we chose to remember Lee’s great contributions to our business and our industry by continuing her name on the masthead.

Lee Allen remains an inspiration to those of us who knew her, and is fondly remembered by many clients, South Portland citizens, and insurance professionals throughout New England.

Here is a reprint of Lee’s obituary; a very brief list of the many acccomplishments of  a remarkable woman.

 

SO. PORTLAND – Leone G. ‘Lee’ Allen, 72, of Wescott Road, So.Portland, died Thursday, December 13, 2001 at her residence.She was born in Prentiss, Maine, a daughter of Laurence and Bernice Lindsay Averill.She attended Prentiss Schools and graduated in 1946 as an Honor Student from Bangor High School, and attended the University of Maine Evening School.
In 1961, she became the first woman in Maine to receive a Chartered Property Casualty Underwriter (CPCU) Designation.Mrs. Allen was the co-owner and Treasurer with William Soule of Soule Allen Insurance in So. Portland.
Mrs. Allen also received numerous awards including, ‘Insurance Woman of the Year’ in 1967; Governor’s Highway Safety Award in 1967 for Defensive Driving Activities, Maine Truck Owners Safety Award in 1970 for ‘Outstanding service in the Field of Highway Safety’, ‘New England Insurance Agent of the Year’ in 1979 for the contribution to the insurance industry and the community, ‘professional insurance Agents of Maine 1993 Agent of the Year’ which was for outstanding leadership and dedication to the insurance industry and the independent agency community.This year the Maine Chapter of CPCU 2001 Award was renamed in her honor, The Lee Allen Presidents Award for Excellence.
Mrs. Allen is survived by a sister Beverly Smart of Kennebunk, Maine, a brother Laurence Averill of West Palm Beach, Florida, several nieces and nephews; and her longtime business associate of 30 years, William R Soule of So. Portland.

Five Thoughtful Holiday Gift Suggestions – Insurance Agent Approved!

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It’s Black Friday, the traditional start of the holiday shopping season. If you’re stumped for gift ideas this year, we have a few suggestions for thoughtful gifts that are approved by your local Maine insurance agent.

Smoke & Carbon Monoxide Detector

Not only could they save hundreds of lives each year, carbon monoxide detectors are required in Maine before you can sell or rent any residence. They are a inexpensive, easy to install, and a great way to protect those you love.

Data Backup Solution

All electronic and mechanical devices fail eventually. It’s not a matter of IF, but WHEN it will happen to your loved ones. With the popularity of digital photography and music, we risk losing irreplaceable memories and expensive entertainment media.  Why not give a data storage subscription or an external hard drive? A recent study of home computer users indicated that nearly 90% did not regularly back up their data. By giving an easy means to back up their information, you are helping spare someone from heartbreak, expense, and inconvenience. How thoughtful!

Personal Emergency Response System

The “I’ve fallen, and I can’t get up” TV ads became the unintentional source of humorous imitation several years ago. But there’s nothing funny about the thought of a loved one being unable to call for help when they need it most. If someone on your gift list lives alone, and has health or mobility challenges, they probably do worry about that scenario. Why not show them that you care about them by giving them a portable call button system?

Tree Pruning Gift Certificate

In our business, we see a lot of damage from fallen tree limbs. Another common question we get is “my neighbor’s tree fell on my property“, which can lead to community discord. Tree maintenance is not for the faint of heart, or the fragile of health. Proper pruning requires special tools and knowledge, good balance, strength and fearlessness. It’s best left to a professional. A gift certificate for a local tree pruning service can help preserve your loved one’s property, health, and neighborly relations.

Bicycle

When you were a kid, didn’t you often wish for a bike? More and more adults are rediscovering the joys of riding a bike. It’s healthy, saves money, is good for the environment, and – most of all – it’s fun! Who wouldn’t feel loved if you gave them a new bike?

The Noyes Hall & Allen team wishes you a safe and happy holiday season.

How Much Does Car Insurance Cost For a 16-Year Old in Maine?

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Parents of young teens often dread the day they start driving. They worry about their safety, the responsibility for others in the car or on the road, and the expense. Between insurance, gas, and maybe  buying another car, it’s expensive to have a teen driver.

teen driver by jamesstewartThe cost to insure a teen driver varies greatly, depending upon driving record, vehicle types, use of the vehicle, and coverage level. Rates and rules vary by insurance company, too. Most Maine insurers only require you to add a driver when they get their license, not their learners’ permit.

If everyone’s driving record is clean, your teen has a vehicle at their disposal most or all of the time, and that vehicle has comprehensive and collision coverage, expect to pay $1,500 to $2,000 extra per year to add a teenager to your policy. If they buy their own vehicle and insurance, it can cost more than that.

Strategies to Reduce the Cost of Car Insurance for Your Teen.

  1. Drop collision coverage on the vehicle.  Yearly savings: about $500 – $750.
    If your teen is the primary driver of a vehicle that is paid off, you can choose to self-insure collision damage for that vehicle.
    Downside:  If the vehicle is damaged in an accident, your insurance company will not pay to repair it.
    Surprising Fact: Teens may drive more carefully, knowing that if they’re in an accident, the vehicle may not be repaired or replaced.
  2. Have fewer cars than drivers. Yearly savings: about $1,000 to $1,500.
    If your child does not have a vehicle available for everyday use, they are considered an “occasional operator”. Most insurers charge a lower rate for these drivers.
    Downside: You have to share a vehicle, which can be inconvenient.
    Surprising fact: Many families start with this approach, and move to option #1 as the teen gains driving experience.
  3.  Get the Discounts You Deserve. Yearly savings: $50 to $100.
    Most insurers offer Maine auto insurance discounts for teens who are honor roll students or who complete a driver education program.
    Downside: none. Who doesn’t like saving money, or encouraging your teen to make good grades?
    Surprising Fact: Some insurers offer auto discounts for being a non-smoker, low-mileage driving, or displaying safe driving habits.

If you’re in the market for auto insurance in Greater Portland, get 5 free car insurance quotes online, or call Noyes Hall & Allen at 207-799-5541. If you live in another area, we recommend calling a local independent agent. Look for an agency that can offer you a choice from Maine’s best auto insurance companies, and provide professional local service.

 

Photo credit: Teen driver by jamesstewart is licensed under CC BY 2.0

How Does Getting a Speeding Ticket Affect Your Insurance Rates?

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Police officer with radar gun
Photo credit: NY State Police

Getting a traffic ticket is one of life’s indignities. It’s expensive, embarrassing, and – depending on who’s in the vehicle with you, or who drives by while you’re pulled over – hard to live down. It might ruin your day, but in most cases, if you stay out of further trouble, you won’t have to regret it for too long.

How long do tickets stay on your record? Most insurance companies price insurance using the last 3 years of your driving record. Some companies use a 5 year experience period.

Will my rates go up if I get one ticket?

The good news is that one ticket USUALLY isn’t going to drive your Maine Car Insurance Rates up too much. If it’s a speeding ticket, and you were going less than 20 miles over the speed limit, most insurance companies consider this a “minor violation”. Passing a stopped school bus, driving more than 20 mph over the limit, and other more serious infractions have more serious consequences on your insurance rates.

Have the insurance rules about tickets changed?

Just a few years ago, most insurance companies had 3 underwriting tiers: superior, preferred and standard (high risk drivers went to non-standard insurers). If your driving record was squeaky clean when you bought your car insurance, you got the auto insurance discounts associated with the superior rate; if you had one ticket, you were usually still “preferred”. They usually didn’t bump you from your tier if you later had one minor ticket. But, if you got 2 tickets, they would probably knock you down a tier.

Now, car insurance companies have created 50, 75, even 100 pricing tiers, based on an “insurance score” that factors information about you, your vehicle, your driving record, and more. This scoring algorithm varies by company. They consider it proprietary, and guard it closely. Consequently, agents – and customers – don’t know for sure what caused their rates to be high or low. We suspect that insurance companies do now charge for every accident or violation, although probably not a lot for the first ticket.

Should I Shop My Insurance if I have a ticket?

Every insurance company’s rates are different. If you have just one ticket, and you think you’re paying too much for car insurance, check prices. If you live in the Portland area, auto insurance agents like Noyes Hall & Allen would be happy to provide a quote. We’ve even created a way for you to get your own online Maine auto insurance quote from 5 of our companies.It doesn’t hurt to check around; the worst you’ll find is that the rate you’re paying is a good one.

Space Heaters: How to Stay Warm AND Safe

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It’s getting colder in Maine. With today’s high fuel prices, many of us try to delay turning on the heat as long as possible. For some people, that means using a space heater to “take the chill off”. As with any appliance, it’s important to know the associated hazards and best practices for avoiding them.

Fires and Burns

The Consumer Product Safety Commission estimates that space heaters are involved more than 25,000 home fires every year, causing more than 300 deaths.The SPSC estimates that another 6000 people, many of them children, visit emergency rooms for burns from touching hot surfaces.

  • Check the wires, fuel lines and tanks often to make sure they’re in good condition.
  • Keep combustibles at least 3 feet away from space heaters.
  • Leave your space heater on the floor, unless it’s designed otherwise.
  • If you smell gas, turn off all controls, open a window, and leave the area.
  • Propane is heavier than air. Avoid electrical switches or appliances if you smell gas. And, of course, no smoking!
  • Do not use electric space heaters in wet areas, such as the bathroom.
  • Keep children and animals away from space heaters.

Carbon Monoxide Poisoning

CO is an odorless, colorless gas produced by incomplete combustion of gasoline, natural gas, propane, kerosene, coal or wood. Symptoms of CO poisoning include:

  • Dizziness
  • Nausea
  • Headache
  • Fatigue
  • Weakness

Prolonged exposure can cause lack of coordination, confusion, loss of consciousness, and even death.

Modern space heaters (made after 1983) have sensors that automatically shut off the appliance if a reduced level of oxygen is detected. In addition, your best protection is a good, working CO detector.

If you have property in Maine, and have questions about home, renters or condominium insurance, our Portland area insurance agency can help. We’re locally owned, and represent many of  Maine’s best insurance companies. That means we can provide you with customized choices.  Contact a Noyes Hall & Allen agent for answers!

Here’s to a mild – and safe – heating season!

Should You List Jewelry on Your Homeowners Policy?

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That was the most common question at Saturday’s Jewelry Checkup Event that we hosted along with Days Jewelers.

Does Homeowners Insurance Cover Jewelry?

In short: yes, but…

  • Theft of jewelry is limited, usually to $1,500 or less.
  • Your property deductible applies, usually at least $500, often more.
  • Personal property is only covered for 16 “named perils” on the average homeowners policy. For example, ‘theft” is covered, but “losing” something is not. The 16 perils are fine for things like TVs and clothing, but not jewelry. Perils, like losing a gemstone aren’t covered.

5 Reasons to List Your Jewelry on Your Homeowners Policy

  • The value is agreed to before a loss. Instead of having to prove the worth of your jewelry after it’s gone, you list each item with a detailed description and set a value on each piece. Items over $5,000 usually require a professional appraisal every 5 years.
  • Broader coverage. Theft is covered; so is loss of a gemstone – even loss of an earring that’s discovered after you return from a night on the town, or an engagement ring lost at the beach.
  • No deductible applies. You can save money on homeowners insurance by increasing deductibles without having to worry about paying for a lost earring or a missing gemstone.
  • Preservation of limits for your other property. Unless it’s listed, your jewelry falls under your “personal property” limit, which is a percentage of your home’s building insurance limit. If you have a lot of expensive jewelry, even if it’s damaged by a covered peril like fire, you may not have enough “personal property insurance” to replace both your jewelry and your other belongings. Listing your jewelry separately saves that other insurance for your belongings.
  • It’s affordable. Separately listing $5,000 of jewelry usually costs less than $40 a year.

Insurance companies call listing items such as jewelry, furs or fine arts separately on your homeowners policy “scheduling”.

Does your policy declarations page say “Scheduled Personal Property”?

If not, you may want to call your Maine insurance agency to add it.

If you are a Noyes Hall & Allen client, and want to add jewelry, you can request it here, or call the office at 207-799-5541.

If you  are not yet a client, live in Southern Maine and have questions about homeowners,  insuring an engagement ring, renters insurance or condo insurance, call Noyes Hall & Allen agent at 207-799-5541. We’re happy to help.

Recent Law: Texting & Driving Illegal in Maine

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As of this week, Maine is the 33rd state to ban texting while driving. The recently enacted law includes a minimum $100 fine for drivers caught sending electronic messages including texts, emails or instant messages from a mobile device.  The law stops short of banning hand-held cellphone use by drivers. Several Atlantic states, including Connecticut, New York and New Jersey prohibit drivers from using hand-held devices.

map of texting bans by state as of Sepember 2011
source: Insurance Institute for Highway Safety (iihs.org.laws/maptextingbans.aspx)

It remains to be seen whether Maine auto insurance rates increase for drivers who are caught texting while driving. More likely, scofflaws may lose Maine Auto Insurance Discounts if their MVR (motor vehicle record) shows a violation.

It’s unclear how Maine commercial vehicle insurance policies might be affected if a business’ fleet drivers are ticketed for texting & driving.   In general, commercial underwriters have a higher threshold for violations before surcharging a policy.

If you have questions about your personal  auto or business vehicle insurance, contact Noyes Hall & Allen Insurance agency in South Portland at 207-799-5541. You can also request a Maine car insurance quote or a Maine business insurance quote on our web site.

Am I Covered if a Falling Satellite Hits My House or Car?

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I realize I’m out of the loop, but was I the only one surprised to wake this morning to news that a huge piece of space junk is headed straight for Earth?

As usual, my friend Sabine was way ahead of me. She had already tweeted this insurance question (and blog post idea!):

 

 

The Answer to Every Insurance Question is: “It Depends”.

If you have  Maine homeowners insurance, business property insurance, or anything other than the most basic kind of property policy, you’re covered for damage caused by “aircraft, including self-propelled missiles and spacecraft”.

If you have  Maine car insurance, commercial vehicle insurance, or contractors’ equipment coverage, and have included “other than collision coverage”, you’re covered against hurtling space junk. If you bought “liability only” coverage, you’re taking your chances.

Fortunately, your chances of getting hit are infinitessimally low. Probably.

If you live in Southern Maine, and  have questions about your insurance, our Portland area insurance agency can help. Call Noyes Hall & Allen Insurance at 207-799-5541. Or, post on our wall by finding Noyes Hall & Allen on Facebook or tweet us @NHAIns on Twitter.

 

What is “Dwelling Fire” Insurance?

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Most Maine home insurance is written on a homeowners policy. But certain types of property do not qualify for homeowners policies, either because of the characteristics of the property or its occupancy. Properties that do not qualify for Maine homeowners insurance are often insured on a Dwelling Fire policy.

Does a Dwelling Fire Policy Only Cover Fire?

The name is misleading. All Dwelling Fire policies cover more than just fire. How much more depends on which policy form you have.

Dwelling Fire policies offer 3 common flavors: DP-1, DP-2 and DP-3. Homeowners policies also have 3 options, HO-1 through 3. The vast majority of Maine homeowners policies are HO-3; likewise, DP-3 is the most common coverage level found on Maine Dwelling Fire policies.

DP-3 Dwelling Fire policies and an HO-3 Homeowners policies have very similar coverage for buildings. Building coverage is considered “open perils”: unless a cause of loss is excluded, it is covered. The lower-numbered policies provide more restrictive “named perils” building coverage; only specifically listed causes of loss are covered. The DP-2/HO-2 building section covers 12 named perils. The DP-1/HO-1 only covers 4: Fire & lightning; windstorm; explosion; and vandalism.

The Difference Between a Dwelling Fire Policy and a Homeowners Policy

There are several key differences between the two policies.

  • Dwelling Fire policies do not automatically include Liability or Medical Payments coverage.
  • Theft of contents is not covered by Dwelling Fire policies (you can sometimes purchase a small amount for an additional premium).
  • Dwelling Fire policies typically don’t permit optional coverage extensions that are common to homeowners policies (e.g. water backup; identity theft; fallen tree removal; food spoilage).

 

Related Post: What’s the Difference Between a Homeowners Policy and a Dwelling Fire Policy? 

Why do I need to Buy a Dwelling Fire policy?

A Dwelling Fire policy may be required for:

  • Property rented to others.
  • Seasonal property.
  • Other properties as determined by an insurer’s Underwriting Department.

A Dwelling Fire policy covers your property for more than fire. Coverage is generally not as broad as a homeowners policy, but it’s not as limited as the name implies. For advice about your particular situation contact your Maine insurance agency or Noyes Hall & Allen at 207-799-5541.