|
 |
Tuesday May 13 2008 |
Auto Insurance |
|||
 |
|||
 |
|||
 |
|||
 |
|||
|
|||
|
1040 Champlain St. Suite 200, Dieppe, NB E1A 8L8 Tel: (506)857-0064 Fax: (506)857-1809 Toll Free : 888-819-7070 |
Automobile Insurance
- General information
- Standard Owner’s Policy (S.P.F. No. 1)
- Additional coverages
- Limits and deductibles
- How to make a claim
- How we arrive at a premium
- Newly-licensed drivers
General information Automobile insurance is designed to protect you against your legal liability imposed by law arising out of the ownership, use or operation of a motor vehicle. It also provides protection for physical damage to the vehicle (collision and comprehensive coverages).
The wording of the policy is regulated by the Insurance Act. As such, the basic policy wording is the same for all insurers.
The basic automobile form is a “Standard Owner’s Policy” or more commonly known as an S.P.F. No.1.
Standard Owner’s Policy (S.P.F. No.1)The S.P.F. No.1 offers the following coverages:
Mandatory Coverages:
- Third party Liability Protects the insured, and every other person who, with his or her consent, personally drives the automobile against liability arising out of the bodily injury to others or damage to the property of others. Coverage is mandatory in New Brunswick.
- Accident benefits This mandatory section provides coverage on a no-fault basis to all insured persons. Payments are made whether you are at fault or not at fault in an accident.
Payments can be made for the following:- Medical and rehabilitation expenses as a result of an automobile accident, up to a limit of $2500.
- Funeral expenses as a result of an automobile accident, up to $2500.
- Death benefits, as a result of an automobile accident, limit of $50,000 for head of household, $25,000 for spouse or common-law partner of the head of household, and $5000 for each surviving dependent.
- Loss of income as a result of an automobile accident, not exceeding $250 per week.
- Direct Compensation for property damage
This relatively new feature of an S.P.F. No.1 makes your insurer agree to indemnify you directly for damages caused to your automobile as a result of an automobile accident, regardless of fault.
Your insurer will compensate you for a not-at-fault accident or an at-fault accident only if you carry collision coverage. - Uninsured automobile coverage With this section, your insurer agrees to pay all sums that you are legally entitled to recover from the owner or driver of an uninsured automobile or unidentified automobile as damages for bodily injury or physical damages resulting from an accident.
Optional coverage
Optional coverages on an S.P.F. No.1 policy normally relate to coverage against physical damage to the vehicle itself.
There are three principal categories of coverage.
Provides coverage for damage to a vehicle when caused by a collision with another object or by upset.
Provides coverage for damage to a vehicle caused by any peril other than by collision with another object or by upset. It is to be noted that damage to windshields is covered under comprehensive.
You may find that Comprehensive coverage provides coverage that is too broad for your needs. Instead, you may elect to purchase "specified perils" coverage, which provides coverage for damage caused by fire, lightning, theft, windstorm, earthquake, hail, explosion, riot or civil commotion, falling aircraft, rising water, and damage caused while your vehicle is being conveyed on land or water. Specified perils does not provide coverage against vandalism, or for the repair or replacement of windshields.
Additional Coverages available There are several wordings available to provide or enhance basic coverages. These are "endorsements".
Following are some of the most commonly used endorsements.
- "Permission to carry passengers for compensation endorsement"
This provides permission to carry fellow employees, or neighbors for compensation to and from work, and only when you are going to and from your place of employment. - Deletion of Glass endorsement
This endorsement removes glass coverage from the Comprehensive section of the policy, and reduces the premium charged for comprehensive coverage. - Limitation of amount endorsement
When you carry physical damage coverage on your automobile, the standard policy insures up to the Actual Cash Value of the automobile. This endorsement limits the amount payable to the amount specified in the endorsement or the Actual Cash Value, whichever is the lesser. - Valued Automobile endorsement
Often used for Antique or Custom vehicles, this endorsement provides coverage on an agreed value basis. - Loss of use endorsement
The loss of use endorsement provides for the rental of an automobile while your vehicle is out of use as a result of physical damage sustained in an insured loss. You must carry collision and comprehensive coverage on your vehicle to purchase this coverage. - Legal liability for Damage to Non-Owned Automobiles endorsement
This endorsement extends coverage for legal liability for loss or damage to any automobile not owned by you but in your care, custody or control.
You must carry collision and comprehensive coverage on your vehicle to purchase this coverage.
The most common example of a vehicle in your care, custody or control is a vehicle you rent.
Coverage applies only when you have custody of a vehicle for 30 days or less.
With this coverage, you do not need to purchase additional coverage from the automobile rental company.
Coverage applies only when vehicle is operated in Canada or the continental USA.
Coverage applies only when the vehicle is in the care, custody, or control of the Insured and his or her spouse. - Limited Waiver of depreciation
This endorsement waives depreciation on repair or replacement for loss from an insured peril. Most insurers offer this coverage for the first 24 months that a new vehicle is put into service. - Family Protection Endorsement
This endorsement provides limited protection to you, the insured, your spouse and certain relatives in the event of bodily injuries caused by another motorist who has less Third Party Liability insurance than you. The limit of this coverage is the difference between the liability applicable to your automobile and the liability insurance limit carried by the other motorist at fault, less recovery from certain other sources.Limits and Deductibles
For Third Party Liability, you must carry a minimum limit of $200,000, as mandated by Law. However, we feel this limit is extremely low to meet potential financial obligations in the event of an at-fault accident. We recommend a minimum Third Party limit of $1,000,000. There is no deductible under this section.Under Collision and Comprehensive coverages, any claim is subject to a deductible. This deductible amount may vary from $100 to $1000 and even $2500 for higher-priced vehicles.
How to make a claim Making a claim is what proves the worth of your insurance company and of your broker.
Your policy documents will often provide a toll-free number for the insurance company that insured your home. Although you are free to call this number, we suggest you call our office first when possible. You can report the claim to us 24 hours a day by calling 506-857-0064 or 1-888-819-7070.
Your Customer Service Representative will collect the information and report the claim to your insurer on your behalf.
In the event of a smaller claim, your representative will counsel you on whether a claim should be made or not.
Once the claim is reported, an insurance adjustor will contact you to settle the claim.
An insurance adjustor is a trained professional whose job it is to ensure your claim is handled fairly according to the terms of your policy.
As brokers, we follow the claims process. As the claim is being settled, we are available to you at any time should you have any questions or problems.
How we arrive at a premium
Several factors affect the premium you will pay. The use of your vehicle is a factor. There are several categories of use, including pleasure only, driving to and from work, and business use.The type of vehicle you drive is also a factor. Some vehicles cost more to repair than others or are more at risk of being stolen. Over the years, all vehicles build up a “profile” which allows insurers to rate each vehicle for its probability of loss or damage.
Your driving record is also a major factor in determining your premium. At-fault accidents and driving convictions will increase your premium.
Serious driving convictions, such as driving while impaired, refusing a breathalyzer or driving without insurance, will normally lead to your policy being written in the high-risk category for 3 to 4 years. This has a severe impact on your premium.
Newly-licensed drivers
The province of New Brunswick has mandated by law a provision whereby insurers must offer a "first-chance discount" to newly-licensed drivers. With this discount, newly-licensed drivers benefit from a discount whereby their premiums are the same as those of an experienced driver.However, and for a period of six years, newly-licensed drivers will only retain this discount if they have no at-fault accidents, and no driving convictions, even minor driving convictions. Loss of this discount will have a severe impact on your premium levels.
Age is no longer a factor in determining premiums in New Brunswick. A new driver under the age of 25 now pays the same premium as a new driver over the age of 25.
Gender is no longer a factor in determining premium in New Brunswick.
