Car insurance cost rises 17%: Here are some factors that can help lower your bill

 Car insurance cost rises 17%: Here are some factors that can help lower your bill 

Drivers can try several cost-reducing strategies to help alleviate the sting of soaring car insurance, a recent Experian report said. (iStock) Car insurance premiums have soared 17% this year and are set to go higher, pushing some drivers to opt out. But before throwing in the towel on insurance, drivers should consider ways to cut costs on insurance, a recent report said. Inflation is the main reason behind increasing costs, but specifically, these three factors are a significant reason why car insurance has soared in the past year, according to a new report from Experian: Reckless driving has led to more accidents Insurers today are covering more claims than ever before and the severity of these accidents has intensified, according to the report. In just the past year, the percentage of collision claims deemed a total loss by insurers increased from 24% to 27%. Pricier replacement costs  Some auto insurance policies provide a replacement vehicle while the car is in the garage.  "Rental car prices – insurers are among car rentals companies' best customers – have increased for insurers as well as out-of-town travelers," Experian said. "And replacing the aforementioned total loss vehicles means getting the same queue for a new car as the rest of us, particularly if the replacement is for an electric vehicle." The cost of fixing a car is also up  Most drivers have probably felt the sting of soaring car repair costs. For insurers, it's no different. The cost of covering repair has increased as parts and labor costs increased.  "In addition, new technology in cars is making them more expensive to repair," Experian said. "While a fancy car entertainment system might be able to be ignored when it's on the fritz, others, such as driver assistant technologies, often can't be." One way to take control of car ownership costs is by making sure you are paying for the insurance you need. Shopping around for new auto insurance could help lower your costs. The Credible marketplace can help you compare multiple providers and find your personalized rate in minutes without affecting your credit score. MORE STUDENTS TURNING TO FEDERAL AND PRIVATE STUDENT LOANS TO FINANCE COLLEGE: SURVEY Some factors you can control to help lower costs Rising insurance costs are why 45% of insured drivers aged 18 to 34 considered driving without car insurance in the past year, and 17% went without it, according to a recent Policygenius survey. There are some factors that drivers can control to help reduce their car insurance costs, Experian said.   For example, drivers could lower their costs by installing special equipment that tracks a driver's behavior on the road. A good record could qualify you for a safe driver discount, according to Experian.  "Some of them may seem a bit of a chore, but are potentially worth the effort," Experian said. "Taking a few hours of your time to enroll in a defensive driving course can often lower your premiums by 15%."   Shopping for the best provider is another time-tested way for drivers to help reduce costs, according to Experian.  "Choose your insurer carefully," Experian said. "Even bargain hunters may not find it fun to shop around for a new insurer, but the resulting savings might be spent in more exciting ways elsewhere." At the very least, drivers should take the time to keep other costs down to make footing the bill of car insurance easier. One way to do this is to pay attention when and where you gas up, according to GasBuddy's annual Pump Habits study. "Often, filling your tank is an afterthought, which robs you of hundreds of dollars per year," GasBuddy Head of Petroleum Analysis Patrick De Haan said. "Motorists should get in the habit of picking a price, not picking a station."  If you are shopping around for new auto insurance, you can use the Credible marketplace to compare multiple providers and find your personalized rate in minutes. HOMEBUYERS ARE FINDING BETTER DEALS IN THESE CITIES, SURVEY SAYS Driving in these states could save you money Where you live is a big factor in how much you'll pay, according to Experian. Premiums in high-cost states can be twice as much as those in inexpensive states due to several reasons, such as competition among insurers and regulations.   Florida had the most significant increase in insurance premiums over the last 10 years, rising by 88% since 2013, according to a recent study by car subscription providers FINN.  Georgia and Hawaii took the top spots of the states where car insurance is the cheapest, according to the study. Georgia saw the biggest drop in insurance premiums over the last 10 years, falling by 24% since 2013.  Hawaii takes second place, with insurance premiums decreasing by 17% over the last decade to an average of $1,306 in 2023. If you are looking to save money on your car costs, you could consider changing your auto insurance provider to get a lower monthly rate. Visit Credible to shop around and find your personalized premium without affecting your credit score. HERE'S WHY SOME MIDDLE-INCOME AMERICANS ARE STAYING OPTIMISTIC ABOUT THEIR MONEY Have a finance-related question, but don't know who to ask? Email The Credible Money Expert at moneyexpert@credible.com and your question might be answered by Credible in our Money Expert column.

How much long-term care insurance do I need? 

Long-term care insurance can be a crucial aspect of retirement planning, but it's important to buy the right amount of coverage. Getty Images As you plan for your financial future, one crucial aspect to consider is your insurance coverage. And, while certain types of insurance, like Medicare supplemental insurance, are typically top of mind when planning for retirement, one type of coverage may not be: long-term care insurance. This type of insurance helps cover the costs of a range of services and support for those who can no longer independently perform daily activities due to chronic illness, disability or cognitive impairment.  With the rising costs of healthcare and the increasing likelihood of needing extended care as you age, having a comprehensive long-term care insurance policy can provide you with financial security and peace of mind. However, it can be difficult to determine the right amount of coverage. So how much long-term care insurance do you need? That's what we will explore below. Learn more about your long-term care insurance options here. How much long-term care insurance do I need? In general, the amount of long-term care insurance that you need varies from one person to the next based on a number of factors. For example, your location, age, health and even preferences can play a role in your needs for your long-term care insurance policy, so it's important to weigh those and other factors to determine what makes sense for you. Start exploring your choices for long-term care insurance here. Factors that can impact your long-term care insurance needs Consider the following factors when calculating your policy and coverage needs: Personal preferences and goals  Start by considering your personal preferences and goals. Do you want to receive care at home, or are you open to moving to a care facility? Understanding your preferences will influence both the type of policy and the amount of coverage you need. For example, if your health allows you to age in place and receive care at home, you may need less coverage than someone who anticipates moving to an assisted living facility or nursing home. Home care services can be more cost-effective, but they require different types of coverage and support. Your health Your current health can also impact the level of care you might require in the future. Those with chronic health conditions, disabilities or a family history of specific illnesses may be more likely to need long-term care. Therefore, they may require more extensive coverage. Health conditions can also affect how long you might need care. Some may recover from a temporary health setback and require care for only a short time, while others with progressive conditions may need care for an extended period or even the rest of their lives.  Current age  The younger and healthier you are when you buy the policy, the more affordable it is. This is because insurance companies assess the risk of you needing care in the near future, and younger healthier vindividuals are perceived as lower risk. In turn, your age can directly affect how much coverage you need — or can afford to purchase.  By purchasing a policy when you're younger, you may be able to better fit the cost of a policy in your budget. But if you wait, you could price yourself out of the amount of coverage you need — or be denied coverage altogether. Location  The cost of long-term care can vary greatly depending on where you live. Areas with higher costs of living typically have higher costs for this type of care, so it's important to factor this in when deciding on the amount of coverage you need.  To determine what the average costs could be in your area, research the average costs of care in your area — and consider how much it could increase in the coming years as well. Inflation  Over time, the cost of care tends to increase — meaning you'll likely need more coverage in the future than you would now. To ensure your policy keeps pace with rising costs, you can consider adding an inflation rider to your insurance or purchasing a policy with higher coverage levels when you're younger and in better health. Duration of coverage  When deciding on the amount of coverage you need, you should also decide how long you want your coverage to last. Policies typically offer coverage for a set number of years or provide benefits for life, and choosing the duration depends on your preferences and budget. Assets and income  Assess your current financial situation, including your assets and sources of income. Having substantial assets may allow you to self-insure for a portion of your long-term care expenses, reducing the amount of coverage you need. Conversely, you may need more coverage if you have fewer assets or lower income, as any substantial long-term care costs could be devastating for those with limited budgets. Family support  Consider whether family members are willing and able to provide care in certain cases. While this can reduce the need for insurance, it's crucial to have a plan in place and acknowledge the potential strain on family relationships — and factor that into the equation when determining your coverage needs. Find out more about long-term care insurance here. The bottom line There is no one-size-fits-all answer for how much long-term care insurance you need, as each individual's circumstances are unique. Determining how much long-term care insurance you need requires careful consideration. Make sure to account for all of the possible factors that could impact your long-term care insurance needs, including your personal preferences, current health, location, inflation, financial situation and budget, to ensure that you purchase the right amount of coverage for your unique situation. MoneyWatch: Managing Your Money More More

Solved! Does Renters Insurance Cover Tornado Damage? 

A: Just looking at pictures of tornado damage can cause renters in tornado-prone areas to reach for their phone to call their insurance company and ask, “Does renters insurance cover tornado damage?” A tornado can wipe out an entire building and everything in it, so it’s only natural that renters would wonder if they can insure their personal belongings in the event of such a disaster. The good news is that renters insurance generally does cover tornado damage. There are some exceptions, but renters insurance will generally cover a tenant’s belongings up to the policy limits. Additionally, renters may often have access to loss of use coverage, which helps pay for additional living costs if the policyholder has to vacate their rental for a period of time while tornado damage is repaired. Renters insurance typically covers tornado damage up to the tenant’s policy limits. Photo: istockphoto.com When a tornado siren blares, signaling a potential touchdown in the area, the last thing on a tenant’s mind is their renters insurance policy and what it covers. That’s why it’s a good idea for renters to check with their insurance company about their coverage terms before a tornado—or any other disaster—strikes. Although stand-alone tornado insurance does not exist, most renters insurance policies cover wind damage as part of their standard coverage, which includes damage from tornadoes. The amount of coverage included depends on the limits the renter chooses when they buy their policy. It’s also worth noting that there are exceptions to insurance coverage for tornado damage. In general, it’s necessary for each unrelated tenant living in the same rental unit to obtain their own renters insurance policy. Families who share a rental would all be covered under one policy, although it’s a good idea to make sure the policy limits provide adequate coverage for the entire family. For example, if two unrelated roommates share an apartment, then each person would need to purchase their own insurance policy to protect their belongings from tornado damage. Under its windstorm coverage, a standard renters insurance policy will often protect against tornado-related perils such as wind, rain, and hail. Tenants who have purchased renters insurance for hurricane damage may know that these policies often include windstorm coverage as part of their standard terms. Tornado damage is also typically covered under a policy’s windstorm protection. Windstorm coverage generally includes the actual wind from a storm—such as the tornado itself—as well as additional damage related to strong storms. This additional damage might result from perils such as rain and hail, which commonly accompany a tornado. Protecting against tornado damage is just one of the many reasons tenants will want to strongly consider getting renters insurance. For example, if the wind from a tornado rips the roof off a rental house, the furniture and everything inside could be ruined by the associated rain. The renter could then file a tornado insurance claim to replace their damaged belongings. While renters insurance covers the policyholder’s personal property, it does not cover the building itself. Renters insurance only protects the policyholder’s personal belongings. Any damage to the rental building itself isn’t covered by the tenant’s policy. However, that doesn’t mean the renter is on the hook to repair tornado damage to their apartment or rental home. Renters insurance doesn’t cover building damage after a tornado because this is considered the landlord’s responsibility, and the landlord’s insurance should cover any damage to the building itself. After a tornado damages a renter’s building, their landlord would need to file an insurance claim to have any damage repaired. Although the renter wouldn’t incur any costs to repair the building, significant damage could mean they have to vacate the building while repairs are made, which could lead to temporarily increased costs of living. If this is a concern for renters, they may want to consider how much renters insurance they’ll need in the event a tornado leaves their rental property uninhabitable for an extended period of time. Photo: istockphoto.com Policies with loss of use coverage can help pay for additional living expenses if the home is left uninhabitable after a tornado. Many insurance policies offer an extra benefit to renters to help pay for additional living expenses if their rental unit is uninhabitable after a covered loss. Additional living expenses, or loss of use, coverage is a type of protection that helps pay for the added costs of living if a renter is forced to leave their home due to damage from a tornado or other covered peril. Loss of use coverage is a big reason renters insurance is worth it to many people. For example, if a tornado causes significant damage to the structure of an apartment building, a tenant may need to move into an extended-stay hotel for several months while the damage is repaired. This leads to increased costs in housing, food, and other living expenses. If the renter’s insurance policy has loss of use coverage, then it can help pay for the additional costs of living for the renter’s temporary situation. Renters insurance coverage can extend to belongings outside of the home—a bike chained to a building’s front gate, for instance. Many renters have items they can’t keep within their rental unit, such as a bike they use for commuting or a cart they may use to pick up groceries. To save space, they may store these items in a common area or even outside the building—chained to the building’s fence, for instance, or placed within the building’s courtyard. The good news is tornado insurance coverage often extends to cover these items, so long as they’re kept on the property. It’s also worth remembering that a deductible would apply to these covered items as well as personal property kept inside the home. In general, most insurance policies require the damaged property to be on the premises of the rental property to qualify for coverage. For example, camping equipment stored underneath the porch of a rental house would likely be covered if a tornado causes damage because it’s still located on the property. If the gear was in a storage unit at a different location, it’s possible it would still be covered, although items in a storage unit are typically covered up to a certain percentage of the policy limits. Renters are encouraged to double-check their policies to see where coverage applies so they can avoid having a claim denied. Depending on their policy terms, renters may even be reimbursed for any food that spoils as a result of a tornado-caused power outage. Some renters insurance policies include coverage for spoiled food or other perishable goods if the loss is caused by a covered power failure. However, many policies don’t include a power outage alone as a covered peril. Power outages can happen for many reasons, so insurance companies generally require there to be proof of physical damage to the home to cover spoiled food from a power outage. For instance, if a tornado goes through a town and causes a large power outage, two renters in different buildings may file claims for spoiled food. However, Renter A can find no signs of physical damage to their apartment from the tornado, while Renter B documents significant damage to the side of their home. The renters insurance company would likely not cover Renter A’s claim of spoiled food in that scenario, but it may cover Renter B’s claim because their rental unit sustained physical damage. Photo: istockphoto.com Renters insurance will not cover cars or other vehicles damaged by a tornado, though. Tenants with cars or motorcycles may want to note that renters insurance coverage does not extend to vehicles. Cars and other vehicles (such as an RV or large boat) generally require their own insurance coverage for tornado protection. Comprehensive coverage works as car insurance for tornado damage. This form of insurance protects a vehicle from most types of non-collision damage—fire, falling trees, or hail, for instance—as well as theft and vandalism, among other losses. Renters who want to be sure they are fully protected against tornado damage may want to check the terms of their auto insurance to be certain that their car will be covered in the event of a tornado. In addition, flooding water resulting from a tornado or windstorm will not be covered without a separate endorsement for flood coverage. Flooding water may not be associated with tornadoes to the same degree it is with hurricanes, but the same storms that lead to tornadoes can also produce heavy rainfall and, as a result, the threat of flooding. Renters insurance doesn’t cover flooding water, though. If a building is flooded during a tornado—as a result of heavy rainfall, for instance—renters insurance won’t pay to replace personal property damaged by flooding water. Renters living in an area that could potentially flood may want to consider purchasing flood insurance to complement their renters insurance. Raising policy limits or switching providers can help renters get the right coverage to financially protect themselves in the event of a tornado. Renters insurance is generally one of the most affordable types of insurance coverage available. However, the exact cost of renters insurance depends on a number of factors such as the amount of coverage the policyholder chooses, the rental property’s location, any endorsements selected, and the perceived risk of covered perils. Renters may want to shop around to find the right amount of coverage at the right price. Insurance companies may offer different levels of protection against tornado damage, so it can be a good idea to compare multiple options. For example, not all policies include replacement cost coverage as part of their standard terms, so renters who want this protection may want to ask their insurance agent about what is and isn’t included in their policy. If their current insurance provider can’t meet their needs, tenants may want to consider looking at one of the best renters insurance companies (such as Lemonade, State Farm, or American Family Insurance) to see what coverage is available—for tornado damage and other perils. With the right coverage in place, renters won’t need to worry as much about paying for any potential damage to their personal property the next time a tornado warning is issued.