Over the last 20 years the things that determine the cost of your insurance have changed dramatically. The days when the price was based on your age, vehicle and driving record are long gone. As we all know, credit history has become a huge and universal factor in determining the amount you will pay, on top of claims history, homeownership, and prior insurance coverage. However, over the last few years insurance companies have added a couple of new factors that you may not be aware of: risk profiling and price optimization.
Through the use of immense amounts of data on insurance buyers collected from all kinds of sources insurance companies have started building what they call “risk profiles”. Basically, by using what they see as certain key traits of your behavior when buying insurance, making claims, using credit, your social activities, and other non-insurance information, they match you to categories of people they have developed that supposedly tell them whether you are more or less likely to be involved in an accident, make a claim, hire an attorney, sustain a major injury, and other information that can increase the company’s costs. One major factor in these profiles that some companies are now using is the ability to monitor your driving habits through various electronic devices attached to your vehicle. The companies often refer to this as charging a rate individually tailored to you. This can work out to big savings if the company decides you are a safe driver that is not likely to cost them huge amounts of money in the future. However, if your “profile” says that insuring someone like you means it’s more likely to put a dent in their bottom line, then you will be charged more up front to cover those costs, whether or not you ever actually cost the company a single penny. Whether or not you think risk profiling may benefit or hurt your bottom line, it is based on factors that, for the most part, may indicate whether or not you are a safe bet for the company.
“Price optimization” is a different story. As reported by Consumer Reports in August of this year, some insurance companies are now profiling customers based on their willingness to pay higher prices without shopping and moving to another, less expensive company. That’s right, one of the major factors determining your price with some companies is whether or not you are going to complain or go elsewhere if they charge you more for your coverage. So if you are less likely to shop your rate because you are happy with or loyal to your current company, or just because you think it’s too much of a hassle, you may be paying more for your insurance than the person next door who screams every time their rate goes up a dollar and immediately jumps on the phone or the internet to shop for a better price! If you are like most consumers, this one is a bit hard to swallow. In fact, some state governments find the practice so offensive-California, Florida, Indiana, Maryland, Ohio, Vermont, and Washington-that they have outlawed the practice, and some companies, such as State Farm and Amica Mutual, have stated publicly that they do not and will not use this practice. However, most states-Louisiana included-continue to allow companies to use price tolerance as a price factor. Also, many companies like Allstate, GEICO, USAA and others declined to answer Consumer Reports when asked if they use it.
The bottom line is there are dozens of insurance carriers who want your business. But you must be aware that their premiums to cover you can vary by hundreds of dollars for the same coverage. That’s where the services of an independent agent like Dan Burghardt Insurance Agency can make the difference. If you call an insurance company directly, or request a quote on their website, you will get one price, their price, and you may not know this unless you call a bunch of others. By calling or visiting an independent insurance agent, on the other hand, you will have the advantage of an insurance expert working on your behalf to find the lowest price for the best coverage available from multiple companies at the same time. Additionally, independent agents know the difference between quality carriers and carriers that may not be there for you when you need them. Because they are not beholden to any single company and depend exclusively on your satisfaction to stay in business, finding you the best coverage at the best price with the most stable insurance companies is as much in their interest as it is in yours.
Dan Burghardt Insurance, as an independent insurance agency, will work hard to find you the best value on your insurance coverage, regardless of what factors any individual company uses to determine your cost. This is what independent agents do automatically-no need to ask.
With all of the press about the release of the new flood insurance maps and the accusations flying around that they are inaccurate and unfair, what is not being emphasized is that these changes are not final yet.
Once the initial map revisions are completed there is then a period of time during which the local community governments review the maps and then inform FEMA about any changes that they think need to be reviewed or corrected. Then there is additional time given to the people who live in the affected areas to look at their particular area and address, and for them to let FEMA know of any changes they believe are not correct.
What you need to know, however, is that requests for adjustments and corrections, whether from the local government or an individual, must be based on hard scientific evidence. Merely objecting because you think the change is unfair will not get anything changed. The best way to contest a zone change that affects your property is to contact you local community flood plain manager. You will also most likely need to obtain a new flood survey of your home from an engineering firm specializing in flood zones to provide the evidence needed to prove your case.
The proposed changes to the flood maps in southeast Louisiana, and the New Oreans area in particular, are not expected to be finalized before June or July of next year. This gives everyone plenty of time to find out how th changes affect them, and dispute any errors that might exist.
If you are still unsure what to do contact us at Dan Burghardt Insurance and we will be glad to assist you with beginning the process. If you do not currently have flood insurance, it’s time you consider getting it. We are in the middle of hurricane season and most policies take 30 days to become effective. If you want to find out what it will cost and how to get started call us at (504) 455-7283.
Posted in FEMA, Flood Insurance, Flood Insurance Reform, flood map, flood map change, NFIP | Leave a comment FEMA & Flood Insurance . . . For New Orleans, Everything Has Changed, and Nothing Has Changed Posted on July 16, 2013 by Dean Basse
It’s been almost 8 years since Hurricane Katrina’s wrath exposed the weaknesses in the federal and local levees in and around New Orleans. In the aftermath of that catastrophe FEMA and the federal government displayed a fumbling inability to provide the city and surrounding areas with the assistance it needed.
Flash forward to today. Since that horrible day New Orleans has rebuilt and reinvented itself. The flood control systems have been completely rebuilt and replaced into a system, we are told, that can withstand the ravages of a 100-year storm. And the New Orleans metro area has successfully withstood two more potentially major flooding events, though some of our nearest neighbors were not so lucky.
The city is experiencing a rebirth by almost any measure, and one of the clouds of uncertainty in that rebirth, the outcome of the remapping of the flood zones in the city and surrounding parishes, seemed to be clearing as report after report said the new maps would bring us good news. At last it appeared that FEMA would come through for us and provide some boost in making New Orleans, the greatest city in the world to live in, a little more livable, at least in terms of affordability.
Unfortunately, are once again the victim of federal fumbling. The FEMA maps are full of errors and inaccuracies which, in the wake of the Biggert-Waters Flood Program reforms, could cost many homeowners thousands of dollars, or even tens of thousand dollars, or the possibility of losing their homes altogether. That cloud has quickly become a huge, destructive thunderstorm.
After much criticism from Senator Vitter, FEMA has temporarily withdrawn the maps with a feeble “Oops, our bad!” But does that really help us? For some the answer is an unqualified “yes,” but for may others who would have benefited from the new maps, having to wait longer while FEMA once again tries to correct its mistakes is a huge problem. It means they will face the massive rate increases beginning this October without the offset of being remapped into a more favorable flood zone. The result will be that many more people are going to suffer financial hardship because of FEMA’s inability to do right by New Orleans and south Louisiana.
There are those who say that we have little to complain about, that south Louisiana in general, and the New Orleans area in particular, are the largest net takers in the flood program, that we are paid far more in claims that we pay in premiums. Their attitude is that we should just shut up, pay what we deserve to pay, and be happy that the rest of the nation is good-hearted enough to provide a flood insurance program.
Yes, it is true that we are a net beneficiary of the National Flood Insurance Program-there is no argument there. But is that the only federal program we help pay for? The answer is, of course, obvious. There are many, many programs that south Louisianians pay for in taxes that we receive little or no benefits from. Besides, the argument is absurd on its face when you consider that the flood program, as it has been run up to now, was designed to subsidize some areas. That, after all, is the major issue Biggert-Waters is supposed to change.
It is past the time when the residents of New Orleans, south Louisiana, and the U.S. should be able to expect that a government that spends over $3 Trillion a year will spend their hard earned money wisely, and give its citizens quality, accurate services. FEMA has not only failed New Orleans for the second time, it has failed every tax and flood premium paying citizen of this country. For this we deserve more than just an apology.
At the very least FEMA and the NFIP should delay charging the new rates until they get the maps right. Otherwise, many people are going to be overcharged by paying higher flood premiums than they really owe, as the new maps clearly show. That is extremely unfair, and the flood program should not be allowed to profit from its own mistakes.
Additionally, someone, some company, or some agency should be held accountable for their mistakes and be required to correct them without receiving one additional penny from the American taxpayer. That would only be fair, and it might make them and other taxpayer supported organizations be more careful and double-check their work before they put additional burdens on the people.
In the meantime, the New Orleans area continues to suffer from FEMA’s mistakes. As we hold our breath through another hurricane season and look across our wonderful city, everything has indeed changed. Yet when it comes to FEMA, nothing has changed.
I will continue to follow this, and the developments in the flood insurance reforms, as they develop, so check back often. If you want to know how these changes could affect your flood insurance, or if you don’t currently have flood insurance and are thinking about purchasing it after looking at the new maps, give Dan Burghardt Insurance a call at (504) 441-7283. One of our Flood Insurance Specialists will be glad to answer any questions or concerns you have, and provide a fast, accurate quote on any coverage you need.
Posted in Biggert-Waters Act, FEMA, Flood Insurance, Flood Insurance Reform, NFIP | Tagged Biggert-Waters, FEMA, flood insurance, flood maps, flood zone, levee, NFIP, reform | Leave a comment
No Car Insurance? Look out! The Towing Law Has Changed.
Posted on July 30, 2012 by Dean Basse
Just a little more than two years ago, Louisiana passed a law restricitng the towing of vehicles for no proof of insurance, and other violations, on the first offense to only cases where the police officer determined that the vehicle or driver were a danger to others on the highway. Now that law has been repealed and your car or other vehicle may once again be towed on the first offense.
The reason for the change is that the state Office of Motor Vehicles has no reliable way to track if a driver or vehicle has been ticketed in the past for no-insurance. As a result, the police never know when it is a first offence, and when it is a second, third or greater offense, making the prior law unworkable.
What does this mean for you?
This change means that police once again may have the car you are driving towed and impounded whenever you cannot provide proof-of-insurance on the vehicle, regardless of your previous record. It means that you can quickly be liable for hundereds of dollars in fines, towing charges, storage fees, and license reinstatement fees. And, on top of all of this, you will still need to purchase a car insurance policy to provide the proof of insurance to the authorities required to get your car out of impoundment and remove the flags from your license.
With this change in the law, it is obviously cheaper to just carry the required insurance and avoid all the extra hassles and expenses. Dan Burghardt Insurance can provide the coverage you need quickly and at a price you can afford. Our large selection of companies, downpayment options, and payment plans make it easy and affordable for you to stay legal and avoid the worry of having your car towed and impounded. And you always get your ID Card immediately when you buy from us. You can even buy over the phone-no office visit required!
Call us today at (504) 441-7283 for the peace of mind knowing you are driving legally and do not need to worry if a police oficer stops you!