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By Kevin Spann | September 14, 2018

Top 5 Insurance Questions People Ask Me When Wearing a Yellow Shirt

This is Kevin Spann, The Insurance Guru, coming to you live today with the top five questions people ask me when I’m wearing a yellow shirt.
Can an auto insurance company raise your rates? Yes. An auto insurance company can raise your rates. The rate that an auto insurance company charges you is guaranteed for that policy period. Whether it’s a six month policy or a one year policy, once that policy is issued, based on your driving record, your claims record and a few other factors, those rates are locked in for that policy period only. However, when that policy comes up for a renewal, an auto insurance company can raise your rates.
When should I cancel my auto insurance? The answer to that question is the only time you should permanently cancel your auto insurance if you’re surrendering your driver’s license and you never plan to drive again. You say, “But Kevin, but Insurance Guru, what if I don’t have a car for a little while, and I’m not going to be driving? Why should I still pay insurance?” The answer to that is because you still hold your place in line and it will make your rates much less expensive when you decide to get insurance again.
When should my insurance be suspended? Okay, so let’s say you have a car accident or your car breaks down and you’re not going to be driving a vehicle for one month, or two months, or six months until your finances are restored. Ask the insurance company can you suspend your coverage. By suspending your coverage, you can reduce the amount that you pay. Let’s say you’re in New York and you’re paying $200 per month, you can reduce what you’re paying down to $10 per month or $20 per month, but you will hold your place in line. This way, when you do get another car, you’ll be treated as a person that’s had car insurance continuously, and you’ll be able to get back to the good rates that you had before. Conversely, if you cancel your insurance altogether and you go more than three days without insurance, any major insurance company is going to treat you like a new driver, and you’re going to pay new driver rates.
Why should I have full coverage on my auto insurance? You should have full coverage on your auto insurance whenever you have a late model car. I define a late model car as a car that’s between seven to 10 years old that’s in good running condition that still has some value, so that God forbid if you’re in an accident and it’s your fault, you won’t be left with the full tab of buying a new car. If you drop full coverage, or collision coverage more specifically, and you don’t have collision coverage to pay for that car, the insurance company will not contribute anything. You’ll be out of that car that still has good value and you’ll be forced to buy a brand new car.
The number one question people ask me when I’m wearing a yellow shirt is, “Kevin, why are you wearing a yellow shirt?” I don’t know. Got no answer for that one.