Isn't That Rich Podcast

Navigating the complexities of auto insurance can be overwhelming. Fortunately, we had the opportunity to delve into this topic with Larra Lipe, an Auto Insurance Specialist at FSB Insurance. With her extensive knowledge and passion for educating others, Larra provided invaluable insights into understanding auto insurance coverage.

A Journey from Pastry Chef to Insurance Specialist

Larra's path to the insurance industry was unconventional. Originally a pastry chef, she moved back to Illinois to care for her mother and needed a career that would support her family. Her journey into insurance began with a chance encounter with Aflac, leading her to discover how underinsured she was. Since 2018, Larra has specialized in personal lines of insurance, focusing on home and auto policies. She joined FSB Insurance in March of this year and has been dedicated to helping clients understand their coverage ever since.

Understanding Auto Insurance Policies

One of the most critical points Larra emphasized is that many people mistakenly believe they have full coverage if they have comprehensive and collision insurance. However, coverage is only up to the policy limits, and understanding these limits is essential. For example, in Illinois, the minimum required coverage is $25,000 per person for bodily injury and $50,000 per accident. This coverage may not be sufficient in severe accidents, highlighting the importance of reviewing and possibly increasing your policy limits.

Key Components of an Auto Insurance Policy

Larra broke down the basic components of an auto insurance policy:

• Bodily Injury and Property Damage: Covers injuries to other people and damage to their property.
• Uninsured/Underinsured Motorist Coverage: Protects you if you're hit by a driver with insufficient insurance.
• Comprehensive and Collision: Covers damage to your car from accidents and other incidents like theft or natural disasters.

Additional Coverage Options

In addition to the basic components, there are optional coverages you can add to your policy:

• Rental Car Coverage: Provides a rental car while your vehicle is being repaired after an accident.
• Towing and Roadside Assistance: Covers costs associated with towing your vehicle or getting roadside help.

Larra recommends these add-ons to ensure you're adequately protected in various situations.

The Importance of Working with an Insurance Agent

Larra stressed the importance of working with an honest insurance agent who can help you navigate the complexities of auto insurance. An agent can compare quotes from different companies, explain what the coverage limits mean, and help you find the best policy for your needs. This personalized service can save you time and ensure you're not underinsured or overpaying for unnecessary coverage.

The Role of Claims and Tickets in Your Insurance

Tickets and claims can significantly impact your insurance rates. For instance, minor speeding tickets may be considered minor traffic violations, but excessive speeding tickets can lead to higher premiums. Insurance companies typically review your driving record for the past three to five years. Therefore, it's crucial to stay in touch with your agent, especially when your policy is up for renewal, to ensure you're getting the best rates.

The Dangers of Distracted Driving

Distracted driving, especially texting while driving, can lead to severe penalties and increased insurance rates. Larra highlighted the rising number of accidents among young female drivers due to cell phone usage. It's a stark reminder to stay focused on the road and avoid distractions.

Mechanical Issues and Auto Insurance

Mechanical breakdowns, such as a blown transmission, are not covered by auto insurance. However, if your policy includes roadside assistance, you can at least have your vehicle towed to a repair shop. It's essential to understand the limitations of your coverage and maintain your vehicle regularly.

Shopping for Insurance Online vs. Using an Agent

While shopping for insurance online might seem convenient, Larra advises against it due to the lack of personalized guidance. Online policies may not provide adequate coverage, and you could end up with gaps in your insurance. An agent can tailor your policy to fit your needs, ensuring you're fully protected.

Payment Options

Paying your insurance premium in full annually can result in discounts. However, for those who prefer monthly payments, using checking account information instead of a credit card can save on additional fees.

Final Advice

Larra's parting advice is to review your declaration page—the document that outlines your coverage limits—and discuss any concerns with your agent. Ensuring you have the right coverage can make a significant difference if you're involved in an accident.

Auto insurance may be complex, but with expert guidance from specialists like Larra Lipe, you can navigate it confidently and ensure you're adequately protected.