Frequently Asked Questions

Insurance companies use a variety of factors to set your rates, including your age, location, credit score, claims history, and the type of coverage you choose. For auto insurance, things like your driving record and car model also play a role. Shopping around and maintaining a good record can help you get the best rates.

Comprehensive car insurance covers damage to your vehicle from non-collision events, like theft, vandalism, fire, or natural disasters. It’s optional, but often required if you lease or finance your car.

When you experience a loss—like a car accident or house fire—you file a claim with your insurer. They’ll review the details, assess the damage, and determine how much they’ll pay based on your policy. You may need to provide documentation or meet with an adjuster.

Liability insurance protects you if you’re found legally responsible for injuring someone or damaging their property. It’s included in auto, homeowners, and renters policies, and is essential for covering legal fees, medical bills, and settlements.

An insurance premium is the amount you pay—monthly, quarterly, or annually—to keep your policy active. It’s basically the cost of having insurance. Premiums vary based on your coverage, risk factors, and the type of insurance you buy.

Renters insurance is often overlooked, but it’s a smart investment. It covers your personal belongings if they’re stolen or damaged, and provides liability protection if someone is injured in your rental. It’s usually affordable—often less than $20 a month—and can save you thousands in case of disaster.

A deductible is the amount you pay out of pocket before your insurance kicks in. For example, if you have a $500 deductible and a $2,000 claim, you pay the first $500 and your insurer covers the rest. Choosing a higher deductible usually lowers your premium, but means more upfront cost if you file a claim.

A good rule of thumb is to have enough life insurance to cover your debts, mortgage, and provide for your family’s living expenses for several years. Many experts suggest 7-10 times your annual income, but your needs may vary based on your lifestyle, dependents, and financial goals.

Homeowners insurance typically covers damage to your home from things like fire, storms, theft, and vandalism. It also protects your belongings inside the house and provides liability coverage if someone gets hurt on your property. Some disasters, like floods or earthquakes, usually require separate policies.

Car insurance is a contract between you and an insurance company that helps cover financial losses if you’re in an accident or your car is damaged. You pay a monthly or annual premium, and in return, the insurer helps pay for repairs, medical bills, or liability costs, depending on your coverage. Most states require at least liability insurance, but you can add collision, comprehensive, and other options for more protection.

When choosing life insurance, you’ll often hear about “term” and “whole” life policies. Term life insurance covers you for a set period—like 10, 20, or 30 years—and pays out if you pass away during that time. It’s usually more affordable and straightforward. Whole life insurance, on the other hand, lasts your entire life and builds cash value over time, which you can borrow against. It’s pricier, but offers lifelong protection and a savings component.

If you want to lower your monthly premium, or buy more coverage for less money, one way is to carry a higher deductible. A higher deductible also may make sense if you believe that your chances of making a claim are remote enough to warrant assuming extra financial risk.

It depends on the type of policy you own. But in general, unless you buy additional coverage, you won't be compensated for losses due to floods, earthquakes, nuclear accidents, wars, intentional damage, and normal wear and tear. Other exclusions may also apply.

A home can require a tremendous investment of money, time, and energy. Homeowners insurance is designed to protect that investment by insuring the actual structure or structures and the personal possessions in and around them, as well as providing liability protection for the residents. Through homeowner's insurance, you can protect yourself and your family from enormous loss in the event of damage or destruction to your home and property. Most likely, if you have a mortgage on your home, you are required to carry homeowner's insurance.

You can purchase additional coverage, through an endorsement to your existing policy or with a separate policy, to extend the limits of coverage for specific items.

After an accident or theft recovery, if the insurance company decides your car is "totaled," it means the estimate of repairs exceeds the car's value. At this point, the insurance company will likely send you a check for your car's value. It gets to keep your car unless you make arrangements to buy it back "as is".

If you were not at fault in the accident, you will make a third-party claim to the at-fault driver's insurance company. Because you are the claimant, the insurance company typically will issue the check directly to you. It's your responsibility to pay the repair shop, and the lender if you have a car loan. If the other driver doesn't have insurance, your uninsured motorist coverage will take effect.

If your car was stolen, be prepared to wait. Most insurance companies will impose a waiting period to see if the police recover your car. If your car is still missing after the waiting period, usually 21 days, you should receive a settlement soon after. If your car is recovered during the waiting period, the insurance company will want to see a repair estimate before deciding how to proceed.