Tips for Buying a New Vehicle

I don’t normally buy new vehicles, preferring instead to buy a vehicle slightly older so someone else pays for the depreciation.

However, in 2006 we purchased a brand new car.

And it was the first time I ever felt as though we did ok on the purchase. In the past we walked out of the dealership feeling stung by the experience.

What was different this time around?

I followed these steps:

1) Do your research and decide exactly what vehicle make and model you want to buy
2) Go on the internet and find websites for the dealerships in your area
3) Contact these dealerships via email and tell them you are interested in buying that specific vehicle make and model
4) Give each dealership the timeframe you expect to make a purchase
5) Let each dealership compete for your business through email with you (on an individual basis)
6) Do not let the dealerships know the others who are also competing for your business, but do let them know you are shopping
7) A week before you are set to buy let them know the exact day you are making a decision and tell them you need their best offer

This plan worked to perfection for us.

Filing an Auto Insurance Claim

No one likes filing an insurance claim – it means our lives have been disrupted with something that will probably cost us time, money, aggravation or all of the above.

When you file a claim, have a pen and paper ready.

Write down who you talk to and the date. Keep a note pad specifically for the intent of recording every conversation or promise made along the way.

I firmly believe most claims reps work hard. I firmly believe that most claims reps try to serve the client to the best of their ability.

But sometimes you run into situations or people where the best intent goes awry. And that is where you need to document.

Claims situations can be stressful enough without having a claims rep who gives poor service or does not return calls. I have seen or heard this complaint before. But for all the claims that happen these complaints are few and far between.

If you have trouble with a claims rep contact your agent and let them get involved.

Credit Scoring – What you should know

The Michigan Supreme Court has ruled that insurance companies in their state may use credit scoring.

It’s a practice used in a lot of states, including Arizona, to partially determine auto and home insurance rates.

Some insurance companies utilize credit scoring to a greater degree than others. One carrier may look at credit first and place a consumer in a specific tier based on their insurance credit score. Then other factors are added into the mix. Other carriers may give credit scoring the same or less affect as other factors, such as driving record, zip code, age, type of car.

Credit scoring is great for those with great credit.

It may not be so great if you have bad credit or average credit.

If you are against credit scoring being used for insurance purposes, consider this. The Michigan Supreme Court ruled (in part) that insurance carriers adequately demonstrated that credit scoring is a good indicator of a person’s insurance risk. The MI court even went so far to say that credit scoring actually lowers insurance costs.

Don’t forget that having good credit will not only help you pay less for your insurance. You will also pay less for almost any other type of loan – car loans or home loans, and maybe even credit cards. Better credit allows you to secure lower interest rates (and lower payments subsequently) for a myriad of situations.

To our knowledge only 4 states prohibit credit scoring in full or partially. Those include California, Hawaii, Massachusetts and Maryland.

Who to believe?

Attorneys advertise all the time on TV and radio…..or at least so it seems.

Many of these advertisement are directed at the insurance industry. But there is one specific ad that is on radio that I find truly unfortunate. The ad says something like the following:

“If you have an accident do not settle with the insurance company until you have talked with an attorney. It is the insurance company’s job to pay you the least amount possible……..(and on and on it goes).”

The inference is that an insurance company is out to cheat or lowball everyone who has a claim.

I have been in the insurance industry since 1993 and have helped tons of clients with their insurance – and I feel quite different about this issue than these lawyers supposedly do. My experience and the experience of my clients is in opposition of this attorney advertisement.

First of all, almost no one is happy in a claim situation. Your car is damage, you are injured, have been robbed, or your home was hit with a fire, storm or involved in some other type of claim. Almost NO ONE is happy to be involved in a claim. It is a negative situation from the start and sometimes filled with people who are angry and emotional.

While it would be easy to say my loyalty is with the insurance industry and (of course) I would defend them. I would tell you that there have been publicized events where insurance carriers allegedly did not do the right thing necessarily. There are examples where insurance companies have been accused of not treating an insured properly or not handling a claim correctly. They are not perfect, for sure, and I agree with that assessment.

However, there are literally tens of thousands of claims going on at any time with hundreds of insurance carriers, maybe hundreds of thousands of various claims per year. As a guess, I would say 95% of these are handled smoothly and without fanfare.

I officed for about two years within a claims office (rent was right) one time during my career and became very familiar with many of the claims reps. After two years I came away believing that these folks work very hard, try to do the right thing by the company and policyholder and simply did their best to follow the guidelines of the insurance contract.

Isn’t that what all of us would expect in a claim situation? Well…..everyone but the legal field it seems.

Credit reports typically include information on three types of public records – bankruptcies, tax liens and judgements.

Core Score

All that is about to change with the advent of Core Score.

Core Score is information obtained from sources such as rental applications and evictions, auto title loans and payday loans, and transactions with rent to own businesses.

This information may help those consumers who off the radar a bit and traditionally stay away from typical loans. And certainly, it could further negatively impact others.

Just another reason to stay within your budget, do not purchase what you cannot afford and buy on credit only if you can pay it off.