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.

The Consent To Rate Form - In North Carolina This Is A Big Red Flag

More and more insurance companies are sending out a consent to rate letter, also called a consent to rate form to their North Carolina Auto Insurance and North Carolina Homeowners Insurance policyholders. The letter may seem like harmless little form that you sign and return but it isn’t. In fact it should be a big red warning flag to you about your insurance company and your status with them. Alarm bells should be going off in your head and there are a few things you will want to understand before you sign anything.

To understand what a consent to rate letter is and how it works, you must first understand a little bit about how auto insurance and home insurance rates are established in North Carolina. You see, all rates for these policies have to be approved by the NC Insurance Commissioners office. In most all cases, the Insurance Commissioner sets the maximum rates allowed for a North Carolina auto insurance policy and a North Carolina home insurance policy. The various insurance companies then create their own many rate tiers for their policies by deviating, or reducing their rates to something below the maximum allowed rate which is often referred to as the state rate.

What a consent to rate letter does is ask you to give the insurance company permission to charge you rates on your policy that exceed the state maximums. When you sign and return this letter you are essentially giving your ok to be charged rates higher than those established by your insurance commissioner.

Why would the insurance company want to charge you rates above those allowed by the commissioner’s office? Well there are really only two reasons. One is a macro reason and the other is micro in nature. Let me explain.

The macro reason means that the company is doing this for either all or many of its clients. We are seeing this with the North Carolina Homeowners policies from some companies who have too much exposure to possible storm assessments as a result of the beach plan insurance crisis. To read my latest blog about that, please click here.

The micro reason would be that the insurance company has singled you out as a client that they find too risky to insure at their usual rates. Before they can accept you as a customer and issue your policy, they have to know that they can charge you more than the state maximum rates.

Either way, a consent to rate letter is bad news for you as a customer of that insurance company. It implies that either your company is having some difficulties or that you are a bad risk. The implications for you are that you may be seeking insurance from the wrong company. You may not be a good fit for that company for a whole host of reasons. With so many other insurance companies out there, all fighting for your business, your best course of action may be to seek insurance elsewhere.

Before you sign and return any consent to rate letter, you should get an informed second opinion. At Clinard Insurance Group in Winston Salem, NC, we work hard to make sure that our clients and friends are well informed insurance consumers. We can help you better understand what that consent to rate letter means for you. Call us, toll free at 877-687-7557 for any help you may need with your North Carolina auto insurance, home insurance, umbrella insurance or even life insurance. We can give you an informed second opinion on your insurance questions.

The source material for this article was drawn from information found at www.insuranceanswerguy.com.