Bike Commuting – A “newbie” Hits the Streets of Portland Maine

I recently bought my first new bike since I was in junior high (I know, that term gives away my age), and have been trying to commute to work one day a week. It’s good exercise, lots of fun, saves gas, and takes one more car off the road – at least briefly.

I had a few questions to answer before attempting my first commute.
  • Did I have the stamina? My job is mostly sedentary. I walk more than most people, but that’s the extent of my regular exercise. To build endurance, I took longer and longer rides, culminating with a Sunday night “dry run” to the office. It’s only 6 miles, but there are some pretty big hills. It was surprisingly easy. Within a week or two, I felt ready.
  • How would I manage traffic? Sharing the road with cars and trucks was a bit intimidating at first. I went to a discussion about bike safety sponsored by the Portland Bike Commuters Meetup Group. It was great! I learned how to ride in traffic and to increase my safety while on the bike.

The main idea is to dress “bright and tight” and behave like a slow vehicle on the roads – which makes perfect sense. In other words, stay on the street (sidewalks are for pedestrians), “take the lane” when necessary and appropriate, and behave in a predictable manner – using the rules of the road that I already know from driving a car. I also bought a blinky red light for the rear of my bike – only $2.00! A bargain!

 I joined the online Meetup Group that night, and was pleasantly surprised to learn that there were over 200 members who were commuting in Greater Portland!

  • How would I “clean up” at work? Our office doesn’t have a shower. I found that the cool temperatures in the morning prevented me from getting too sweaty. I also paced myself to avoid getting overheated, and dressed in layers I could peel off if necessary (it wasn’t). I found some great beginner’s tips at a web site called Commuting 101 where people shared practical ideas about bike commuting.
  • What if I had an unexpected appointment during the day? This one hasn’t come up yet. I have been able to arrange my schedule for one “office day” a week. If I really needed to get someplace in a hurry, I could probably borrow a co-worker’s car.

I don’t think I’ll become a hard-core year-round bike commuter like some of the people I see on the road every day, but I’ve enjoyed my “alternate commute” the few times I’ve done it.

Some early observations:
  • It doesn’t take much longer than commuting by car. About 30 minutes vs. 15 by car.
Portland drivers are quite accommodating to bikes.  People generally give me the 3 feet clearance they’re supposed to, and pass me only when it’s safe to do so. They’re also patient when I join them in a line of traffic at a light, allowing me to clear the intersection without tailing too closely.

PhpThumb.phpThe proper equipment helps me to feel more confident. Thanks to a timely birthday, I now have a white front light, a “screaming yellow” jacket, the aforementioned blinky red light, a pump and water bottle. I feel visible and equipped to handle most minor emergencies that could arise. I carry a cell phone just in case.

In the next post, we’ll talk about how cyclists can protect themselves and their bikes from other types of accidents.

Lessons from the Lapointe Trial Verdict

Many Mainers followed the recent trial of Medway, MA and Bridgton, ME resident Robert Lapointe, who was charged with manslaughter, reckless conduct with a dangerous weapon and aggravated OUI following a collision on Long Lake in which killed Terry Raye Trott of Harrison and Suzanne Groetzinger of Berwick. The jury was deadlocked on the first two charges and found Lapointe guilty of the third. 


Regardless of your opinion on the case (and everyone in Maine seems to have a strong one!), there are some items worth noting:

  • The criminal trial was only part of Mr. Lapointe’s worries. There will surely be a civil trial now that the criminal trial is over. Yes, he was convicted of two counts of Aggravated OUI, each of which carries a maximum sentence of 5 years in prison. And, the State hasn’t decided whether to re-try him on the two deadlocked charges. 
  •  A civil trial, which would likely charge wrongful death, would be protracted and expensive – regardless of the outcome. Probably the most famous civil trial following a criminal acquittal was The O.J. Simpson case. As everyone knows, Simpson was acquitted of murder in the criminal trial, only to be found guilty of civil charges, which cost $8.5 million in compensatory damages and $33.5 million in punitive damages
  • Maine homeowners insurance and Boat Insurance policies offer liability protection, including defense costs. This would apply only to civil – not criminal – charges. The maximum limits available are generally $500,000. Too many people fail to even carry this amount.
  • Personal Umbrella Insurance policies provide excess liability protection in increments of $1 million. Best of all, legal defense costs are usually NOT taken out of that limit: most policies provide a full $1 million of protection against damages.

 You probably have a tough time identifying with O.J. Simpson or Robert Lapointe. Their cases are extreme. But bad things can happen to ordinary people, too. And your assets can be wiped out by defense costs and liability judgements following an accident. 

Takeaways:
  1. Review your homeowners policy. 
  2. Compare your liability coverage to your net worth.
  3. Consider buying an umbrella policy.  
  4. Talk to your insurance agent.   
  

AIG’s Wild Week

It's been quite a week in the insurance business. Industry behemoth AIG saw its stock price drop from over $14.00 to about $2.00 in three days. AIG has been one of the world's largest and most successful financial institutions over the past 20 years, led for years by Maurice R. "Hank" Greenberg

On Wednesday, The Federal Reserve Bank of New York was authorized to implement an $85 billion liquidity line, in essence giving the Federal Government control of nearly 80% of the company. 

While this is startling news inside and outside the insurance business, it's important to note the following:

  • AIG's insurance operations remain well-capitalized. The National Association of Insurance Commissioners (NAIC), a regulatory body, said in a September 17 press release  "We have a very strong message for consumers: If you have a policy with an AIG insurance company, they are solvent and have the capability to pay claims."
  • By all accounts, AIG's trouble stemmed from its financial holding company assuming more risk than they could handle when investing in complex transactions involving mortgage-backed securities. These investments are financial products, not regulated insurance products. When the housing market took a downturn, these risky investments lost lots of money for AIG's holding company.
  • Non-insurance operations are not held to the same high standards as insurance companies. Think about that when you choose the insurer you trust to protect your assets.     

Even insurance professionals were shocked by how quickly AIG's A.M. Best rating dropped from "A+ (excellent)" to "A (excellent)" , with "negative implications". If insurance people were surprised, how could individual clients keep up with it all? To make matters more confusing, AIG owns over 70 U.S. based insurance companies, with names such as Lexington, New Hampshire Insurance Company, and AIU. Many clients who are insured by them probably don't even know that they're insured by an AIG company. 

Bottom line: find a local insurance professional you trust, and rely on them for advice. These days, they are worth their weight in gold – which, not coincidentally, is an extremely hot commodity .

Car Sharing and Insurance

Our last post talked about a new condo development proposed for downtown Portland, ME that featured shared cars for unit owners. Coincidentally, Joseph White’s column in today’s Wall St. Journal discusses the growing appeal of car-sharing services like Zipcar. Essentially, it works like this: you pay a membership fee to join a service, which gives you access to several vehicles parked in various locations around larger cities. You reserve a car, pick it up at the designated spot, and pay only for the time, tolls and parking when you use it.

I’ve seen Zipcars in several major cities, and even a few in Maine (probably Boston folks escaping the city for the weekend), and some of them put my ride to shame. They have everything from Mini Coopers to minivans, SUVs to BMWs. The concept makes sense for non-car-owning city dwellers who need access to a good vehicle periodically.

Sharing ownership of anything doesn’t always come naturally to many Americans. We tend to be picky about our “stuff” – especially our cars. What if the last driver left the car a mess? Or low on fuel? Or in the wrong lot? Who maintains the vehicles? Of course, the car-sharing services address these and other issues.

What about insurance? In our agency, we haven’t actually seen a car-sharing contract, or been asked by our clients yet. However, our understanding is that at least one car-sharing company buys a blanket auto policy providing $300,000 liability coverage (much lower limits for those under 21), and assesses a $500 fee for damage you cause in an at-fault accident. Presumably, a condo association would buy similar coverage. Most insurers would be reluctant to insure lots of different unrelated drivers; they would probably charge more as a result. And, what if one of the condo unit owners was a poor driver? Would the other drivers have to pay more money for their exposure?

Another issue: many individuals have assets higher than $300,000. And Maine’s Wrongful Death Statute allows up to $500,000 in damages per person, PLUS punitive damages. Many members, if they don’t own other vehicles, may have no auto coverage of their own. They would be out of luck if an accident exhausted the $300,000 limit, and would be responsible for the remainder of the damages “out of pocket”.

Possible solutions: One could buy a “named non-owner” policy, or a personal umbrella policy. How the latter would respond to a “shared car” situation is an interesting question that has (to our knowledge) not been presented.

Sometimes, societal changes happen faster than the insurance industry can react, but the industry’s mission is to help the public manage risk. Car sharing services are gaining in popularity. It’s a matter of time before personal auto insurers develop procedures for addressing the exposures they present. We suggest that you confer with your agent if you are thinking about joining a service.

New Urbanism in Portland Maine? Micro-housing, Carsharing and Other Trends

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A Portland developer hopes to cash in on the current appeal of chic city housing, with an innovative proposal for the corner of High and Danforth Streets. The building would contain 26 “micro units” – each 450 to 800 square feet – with shared lounges, laundry, and even guest rooms. One of the most intriguing features of the project is the concept of the condo owners sharing use of commonly-owned vehicles.

Publications as diverse as the Wall Street Journal and The Atlantic Monthly have noted the trend to “downsize” housing from the suburban McMansions that were built in the past 15 years to smaller spaces closer to town. The movement has been dubbed “micro-housing” by some, the “not so big house” by others.

Nudged by recent increases in home heating and gasoline costs, along with smaller household sizes as the Baby Boomer population pig pushes through the demographic python, many Americans are looking to downsize, and lots are looking to move closer to cities’ amenities, health care facilities and social life.

Which brings us back to the northeast corner of High and Danforth Streets in Portland, Maine.

Looking at this lot, it’s hard to imagine how one could squeeze 26 condo units (and the residents’ cars) onto it. The short answer is, it’s impossible, without thinking differently. Picture a building owned by an association of 20-somethings who may be buying their first real estate, and work within walking distance; older singles (50-60) attracted to downtown amenities; and out-of-towners seeking a Portland pied-à-terre. Imagine only 14 parking spaces under the building for those 26 units, two of which are for shared vehicles.

Green types applaud the project’s low-impact, pedestrian-centric design. Affordable housing fans like the promise of home ownership for those who might otherwise be shut out. New urbanists like the community orientation and the opportunity for people to walk to work, and “third places”. For developers, it allows maximum profit from a minimum parcel. And, because of the small sizes of the units, municipalities have considered variances to normal parking requirements.

For some people, this is a great idea. But it does pose some practical issues, not the least of which is how to insure them. More about that in our next post.

Questions about Maine condo insurance, homeowners insurance or Maine business property insurance? Want to get an insurance quote on your property? Contact Noyes Hall & Allen Insurance at 207-799-5541.

Alternative Heat: Burning Wood

Rising heating oil prices have Mainers thinking about the cold of winter in the middle of summer. Firewood supplies are scarce, and prices high, the newspaper reported last week. Consumer advocates are warning about unscrupulous dealers and unsafe wood-burning practices. Even Gov. John Baldacci is using his bully pulpit to spread the word.

Maine insurance agents and companies have been concerned for a few years about the prospect of paying more Maine homeowners insurance claims due to fires caused by inexperienced woodstove operators. Presque Isle’s MMG Insurance has some of the best material, from a two-page brochure (pdf) to a 13 page manifesto (available upon request).

If you’re thinking of burning wood, check them out.

How to Get Golf Cart Insurance in Maine

Higher fuel prices continue to inspire Americans to find another way to get from here to there. An Associated Press report in last week’s Press Herald talks about the growing use of golf carts as alternative transportation. Increased golf cart use has led to a corresponding increase in emergency room visits -12,000 a year – as energy-sipping buggies brave public roads with their larger, faster cousins.

Several Maine jurisdictions, including Chebeague Island, have passed ordinances allowing use of golf carts on some public roads, subject to restrictions. Some of our clients who live in these communities have been required to provide evidence of liability insurance in order to use their golf carts on local roads.

If it’s licensed for use on public roads, Maine Law requires the owner of any vehicle subject to registration for use on public roads to purchase liability insurance. Just one problem: homeowners policies only cover golf carts being used on your land, or when you’re actually playing golf (on a golf course!); and you can’t add a golf cart to a standard auto policy. What’s a frugal consumer to do?

Some insurers have introduced special policies, similar to motorcycle policies, for Maine golf cart insurance. They provide the liability and uninsured motorist coverage that are required by Maine Law. There have been some reports of agents issuing insurance ID cards for carts without the proper coverage. Make sure that you have a policy specifically listing your golf cart, and specifying that it covers use on public roads. Otherwise, if you become one of the 12,000, you might find your trip to the ER is even more expensive than you thought.

For more information from a Maine insurance agency about insuring a Maine golf cart, contact Noyes Hall & Allen Insurance at 207-799-5541.