Parents of Teen Drivers, What Is A DL 123 Form and Why Do You Need It?

In North Carolina, all drivers must provide proof of insurance in order to obtain a drivers license. This rule is designed to reduce the number of uninsured drivers out there on our roads and highways. The cross check mechanism for maintaining this rule is the DL 123 form and if you have a teen driver who is eligible to get his or her license, then you will need this form.

When you take you teenager in to the DMV to take the road test to get his or her license, one of the things you must have with you is a signed DL 123 form. This form will state your child’s full name and date of birth and will show your insurance company name and your policy number. Requiring this form is the way that the DMV makes sure that your child will be an insured driver when he or she leaves the DMV offices with that shiny new driver’s license. When you request this form from your insurance agent, they will set up the file to add your child as a driver to your policy as soon as you have your child’s new drivers license number.

Of course adding a teen driver to your North Carolina auto policy will mean a drastic increase in the cost of the policy. That’s because young drivers are inherently more dangerous and cause accidents more frequently with higher severity. Some people can be quite creative in trying to find ways around adding their child to their policy. The DL 123 form is designed to combat that behavior. And let’s face it, if you are paying the full freight for your teen driver on your policy, you should want everyone else to do it as well or else you will be subsidizing those that don’t.

At Clinard Insurance Group, in Winston Salem, NC, we work hard to help our clients be informed insurance consumers. If you need help with your teen driver insurance or safety questions or if you would like help with your auto insurance or your home insurance or your business insurance policy, please call us toll free at 877-687-7557 or visit us on the web at www.ClinardInsurance.com.

The source information for this article was pulled from other articles and information which can be found at www.InsuranceAnswerGuy.com.

Construction and Building Contractors – How should you define an Independent Contractor?

It’s really the nature of the business in construction. Whether you are a brick mason, a carpenter, a painter, a plumber, or even a landscaper, from time to time you will find yourself in the position of needing to hire a subcontractor. But how you define an independent contractor and the way the law and the insurance industry define this term might be very different. It is important for you to get this right, not only for your workers compensation and general liability insurance, but also for the protection of your business and perhaps your personal assets. And here is a clue – you don’t get yourself off the hook simply by providing a 1099 instead of a W2.

It is very important that you handle the interaction of your general liability insurance policy and your workers compensation insurance policy with your subcontractors. I have covered strategies of this type in previous blogs, whether it be the impact on your insurance audits, or the increased risks that subcontractors add to your business. This article is not intended to tackle those areas. Instead, here I want to really focus on the definition of an independent contractor so that you don’t make the mistake of treating an employee as an independent contractor and increase your business risks as a result.

While there is no clear basis for making the determination of who is an employee and who is an independent contractor in the eyes of the law, here are a few relevant factors that you should consider.

Who sets the hours of work? If the employer does, then it is more likely that the worker will be determined to be an employee. Does the employer provide training for the job? If so, this points more to an employer/employee relationship. Is the worker paid by the job, or paid by the hour. Hourly workers are much more likely to be viewed as employees. Can the person work for more than one firm at a time? If not, perhaps they are really an employee. Who furnishes the tools or materials needed for the job? If it is your company, then you may be dealing with an employee, rather than an independent contractor. Is the work part of the regular business of the employer? This one seems a bit vague but if you are hiring people to do the regular and usual work of your company, then they are most likely employees.

At Clinard Insurance Group, in Winston Salem, NC, we specialize in helping all types of construction contractors with their general liability insurance, workers compensation insurance and all other business insurance needs. We want our contractors to be informed consumer and help them run their business using best practices that help reduce risks to their assets. If you are in the construction business and would like help with your business insurance needs, please visit us on the web at www.TheContractorsHelper.com, or call us, toll free at 877-687-7557.

The source information for this article was drawn from articles which can be found at www.InsuranceAnswerGuy.com.

Used Car Dealers Insurance – Don’t forget your DOC protection

Used car dealers insurance is a specialized coverage and few agents understand it. So how many used car dealers are getting it wrong when it comes to drives other car coverage? The answer is most all of them. If you are a used car dealer and you operate as a corporation, partnership or LLC, you might be leaving yourself open to a huge exposure if you haven’t tackled the drives other car coverage.

Drives other car coverage is simply an endorsement that you can add to your garage liability policy to extend coverage for you individually to the cars that you may drive that you don’t own or that you rent. Almost every personal auto policy in almost every state provides this protection automatically. And the garage policy does as well if you have symbol 21 on that policy. For more information about the garage symbols and what they means, click here.

So what is the problem? The problem is that this protection for hired and non owned vehicles is extended to the named insured, not the driver. So, if your dealers insurance policy is written in the name of your corporation, or your LLC or partnership, then this coverage is only extended to that entity and not to you as an individual. Perhaps an example will help explain the real risk and pull back the veil a bit on this DOC mystery.

Let’s say you are a used car dealer and your garage insurance policy is written in the name of your corporation, Joe’ Used Car, Inc. Because you always drive a car with the dealer tag on it, you don’t worry about purchasing a personal auto insurance policy. Now, let’s say one day you need to borrow your neighbor’s car and while doing so you are involved in an accident that is your fault. Assume the costs of this accident are $100,000 and your neighbor only carries $50,000 coverage on his personal auto insurance policy. Now if you had your own personal auto insurance policy then that policy would step up and provide the excess coverage of $50,000 that you need personally for this accident. And, your garage policy will do this also, but, only in regards to protecting the named insured on that garage policy which is Joe’s Used Cars, Inc, not you.

This scenario gets even worse if your neighbor had let his auto insurance lapse because he forgot to pay his bill. Now you are on the hook for the full $100,000. And that would be a very nasty surprise for you.

So what is the solution? Well, you can purchase DOC coverage. DOC stands for Drives Other Cars. This will name you as the individual protected by this endorsement and will extend the coverage of your garage insurance to you individually for cars that you drive that you do not own or that you rent. Now, the odds of needing this protection are in some ways, admittedly long odds. But the cost of the protection is pretty low and the uncovered loss could be enough to bankrupt you. So, if you don’t have a personal auto policy in your name, and your garage policy is in a business name, take a moment to check your policy to be sure that you have purchased DOC protection.

At Clinard Insurance Group in Winston Salem, NC, we specialize in helping used car dealers in NC, SC, GA, VA and TN. We want all of our dealers to be informed consumers. If you need help with your used car dealers insurance, or if you just want to speak with an agent that specializes in your business, please give us a call, toll free, at 877-687-7557 or visit us on the web at www.TheAutoDealersHelper.com.

The source information for this article can be found at www.InsuranceAnswerGuy.com.

North Carolina Auto Insurance Policyholders – Your Adult Children Should Not Be Driving Your Cars

With the North Carolina auto insurance policy there is a relatively unknown loophole that could cost you or your adult child a lot of money. This loophole is triggered if they are driving a car you own and insure but they don’t live with you. The solution to avoid this coverage gap is pretty simple but most people just aren’t aware that they have this problem in the first place.

First of all, let me cover the exact situation that can trigger this coverage gap, then I will explain the gap itself and give you a solution. You will run into this gap in protection if you have a child who is over 23 years old and lives outside of your home but is still driving a car that is title in your name. This happens so often as we help our kids out with a car and then want to keep helping them by keeping the car on our insurance policy to pay the insurance costs on the vehicle. But this type of kindness is very dangerous. I will explain.

The problem is not that your child won’t have protection driving his or her car that you insure on your auto insurance policy. Not at all. After all, you have insurance protection for that car spelled out on your policy. The problem occurs when your child is driving a friend’s car and gets into an accident. You see, since your child is an adult, living outside of your residence, he or she will have no excess protection for cars that aren’t listed on your policy. So, assume your adult daughter is driving her friend’s car and has a bad accident where she is at fault. Her friend’s auto insurance policy will pay the claim but her insurance company can then subrogate against your daughter for those losses. Normally, your daughter could just have your insurance company pay for the losses, but since she is not a resident of your household and is over 23 years old, she will not have this protection. And this could be a very expensive mistake.

So what is the easy solution? Well, you should retitle the car into your child’s name, and have him or her purchase a personal auto policy in his or her name. This will give them the excess coverage protection needed when he or she drives someone else’s vehicle.

At Clinard Insurance Group in Winston Salem, NC, we want all of our clients to be well informed insurance consumers. If we can help you with your auto insurance, home insurance or your business or life insurance needs, please call us, toll free, at 877-687-7557, or visit us online at www.ClinardInsurance.com.

The source material for this article was drawn from articles originally posted at www.InsuranceAnswerGuy.com.

North Carolina Used Car Dealers – The Garage Insurance Policy That You Started With May Not Be The Right One Today.

North Carolina used car dealers insurance starts with the garage insurance policy. Many new start ups find their way to an agent who is able to help them set up their garage policy and the begin selling cars. And for many used car dealers, they just pay their renewal premiums each year without realizing that time is on their side. You see, because of a law in North Carolina that requires insurance companies to offer you a policy when you ask for a quote, there is a two tiered system of policies in North Carolina. If you haven’t checked lately, you might be in the high risk rate class and not even realize that you are paying too much for your garage liability dealers insurance policy.

Since NC is a mandatory insurance state, all dealers who ask for an auto insurance quote must be offered coverage. For this reason, most insurance companies can write a dealers policy but if they don’t specialize in used car dealers insurance, they will simply place your garage insurance policy through the state reinsurance facility. This means you will have to pay the highest possible rate and you will face limited choices on how much liability insurance you can purchase. And last of all, this market of last resort doesn’t offer you any dealers open lot coverage so you won’t be able to purchase comprehensive and collision insurance on your inventory.

Even insurance companies who specialize in used car dealers insurance in North Carolina may still place your policy in the higher rated North Carolina reinsurance facility. Why would they do this? Well there are several reasons and the reasons certainly change over time. As I write this we are seeing many dealers forced to offer buy here, pay here financing in order to sell their cars. The insurance companies don’t like this as it increases the chances that the dealer will be involved in repossessing a vehicle and the claims and losses that might be associated with that activity. So, since they have to offer insurance at some price to those that call, guess what, if you do buy here, pay here financing, you may find yourself in the NC reinsurance facility.

Another reason dealers end up in the facility pool with its higher rates is that they simply have not been in business long enough to develop a track record that helps the insurance company feel comfortable with their business practices. Some companies require as much as 3 years experience before they will move a dealer into their preferred rates policy. I have also seen this problem apply to dealers who wholesale vehicles and never take title to or possession of the vehicles they are selling.

If you are a dealer who used to do on site financing, wholesale, or if you simply bought your current policy when you had less than 3 years in business, there is a good chance that you might now qualify for better coverage at lower rates. You might not be able to find these preferred policies from your current agent though. The reason for this is that insurance for used car dealers is a specialty market and most agents just don’t have access to the preferred policies for used car dealers.

At Clinard Insurance Group in Winston Salem, NC, we specialize in used car dealers and we insure over 300 dealerships across 5 different states. If we can help you with an insurance second opinion on your garage insurance, or if you would like for us to give you a quote on your dealership insurance, please call us, toll free at 877-687-7557 or visit us on the web at www.TheAutoDealersHelper.com

The source information for this article can be found among the many articles at www.InsuranceAnswerGuy.com.

Renting A Car? Your NC Auto Insurance Policy Could Leave You With A Huge Bill

North Carolina Auto Insurance Companies have some protection available for people who rent cars when they travel but even the broadest protections offered don’t protect you against all the losses you are signing up for when you sign your name on the rental contract. Here are three big risk scenarios that you need to be aware of before you sign the rental agreement.

While your NC auto insurance policy will provide you with protection against losses to rental vehicles as long as you have collision and comprehensive coverage on at least one care on your policy, the truth is that this is not the entire picture. The differences in the rental car contracts from the different rental companies may leave you responsible for some losses that your insurance policy doesn’t cover. And in at least 2 of the 3 risk areas, you probably will not be able to find any coverage for this exposure at all. So, what are these gaps in insurance protection?

The first gap area deals with loss of use losses. If you wreck a rental and the rental car company chooses to repair the vehicle, then your contract with them will generally hold you responsible for the loss of rental income on that car until it is fully operational again. This can run into quite a bit of money but the good news is that most NC auto insurance policies have an endorsement that you can add to your policy for a couple dollars a year to provide you with this coverage. You can read more about loss of use coverage for rental cars by clicking here.

The second gap area comes into play if your contract with the car rental agency says that they can choose to replace the car, rather than repair it and you are responsible for all of these costs. The problem here is that your North Carolina auto insurance policy will only pay for the cost to repair the vehicle. If the car was worth $20,000 when you rented it, and after you damaged it, it is worth $8000 and the cost to repair it is $4000, then you will be out another $8,000 after the rental company replaces it and deducts the salvage value of $8000. This is because your car insurance policy will only pay the $4000 to repair the vehicle. As of this time, I know of no insurance company that has protection for this gap in coverage.

The third gap area is called the diminished value gap. This happens when the rental contract specifies that after you cause damage to the car, then you are responsible for the perceived diminished value of the vehicle after it has been repaired. Let’s take the previous example. The car was worth $20,000 and you caused an accident with it that will cost $4000 to repair. Now after the repairs are completed, the car rental company declares the diminished value of the vehicle to be $17,000 because it is now a previously wrecked car. Your NC auto insurance policy will pay the $4,000 to repair the vehicle but the additional $3,000 for diminished value will be your responsibility. In some states, you can purchase coverage for diminished value losses but in North Carolina at this time I am unaware of an insurance company offering this protection.

Taking a trip with the family and renting a car is supposed to be a fun and exciting time. I do want you to enjoy your trips but it is important that you be aware of the limitations of your auto insurance policy for protecting you. At Clinard Insurance Group in Winston Salem, NC, we want all of our policyholders to be informed consumers. If you have any questions about car rental coverage, or if you need any help with your auto insurance or your home insurance, please call us, toll free at 877-687-7557 or visit us online at www.ClinardInsurance.com.

The source information for this article can be found in a blog at www.InsuranceAnswerGuy.com.

Used Car Dealers – Has Your Peak Season Been Left Out Of Your Garage Insurance Policy?

In many retail businesses there is a peak season where inventory runs higher than the rest of the year. For most retail establishments, this ocurs the months leading up to the Christmas holiday shopping season. And most insurance policies for retail businesses have a way to account for this fluctuation in inventory. The dealer’s garage policy does not, but there is a way that used car dealers can protect themselves from this hidden monster without paying an arm and a leg to do it.

The first step is to analyze your dealership to understand if you have a peak season. I have found that most used car dealerships do have a peak season and this season generally runs from February to May. This is the time when income tax refunds are arriving in mailboxes and people go out and buy cars with the new found money. Next, take a close look at how you plan for and deal with this higher sales season. Do you purchase more cars and build up your inventory? If so, when do you start? When does your inventory get back to lower levels?

There are 3 ways to deal with this inventory fluctuation from an insurance standpoint.

The first way is to simply ignore it. This may seem like the least expensive approach at first unless you have a large loss to your lot, such as fire or hailstorm and you discover that you are underinsured without enough insurance to cover all of your damaged inventory.

The second way to handle this inventory fluctuation is to increase the limit on your dealers open lot coverage to the amount that represents your highest inventory level at any time during the year. This is certainly better than ignoring the issue altogether, but why pay for $100,000 of dealers open lot coverage if for most of the year you only need $50,000?

The third way is one that I see very few dealers take advantage of, yet it is the easiest and least expensive approach. Just call your agent when your inventory increases in February or January and raise the limit on your dealer’s open lot coverage. Then, when your inventory has dropped down in late May, give another call to your agent and have them drop your limits back down. It’s easy, simple and it affords you the coverage you need without over paying for insurance the rest of the year. Why more dealers don’t pay attention must only be because they don’t know that this is an option available to them.

At Clinard Insurance Group in Winston Salem, NC, we specialize in helping used car dealers all across North Carolina, Virginia, South Carolina, Tennessee and Georgia with their garage insurance policies. If we can be of help to you with advice or answers to your questions, or if you just want to find out how to get the best policy for the least amount of cash, please call us, toll free, at 877-687-7557 or visit us on the web at www.TheAutoDealersHelper.com.

The source information for this article was found at www.InsuranceAnswerGuy.com.