FAQs - New York Insurance

Health FAQs

What are the principal types of health insurance coverage available today?

Most of the plans we see today are either an EPO ( Exclusive Provider Organization) or HDHP (High Deductible Health Plan). There are others, but these are the most common.

EPOs have copays for office visits, most tests and prescriptions. Hospital stays, surgery and invasive tests are generally covered after a deductible or cost-sharing is applied.

HDHPs are usually coupled with a Health Savings Account (HSA) and have a deductible of at least $1,150 before the insurance portion kicks in. The deductible can be as high as $5,950 for an individual and $11,900 for a family. These deductibles are indexed annually.

Will I need a referral to see a specialist?

Most plans available today do not require a referral to see a specialist, but you will still need to get pre-authorizations for some procedures.

What types of expenditures are commonly excluded under major medical expense plans?

Although providing very broad coverage, most plans typically contain a number of exclusions. Common exclusions include medical expenditures arising from:

• Cosmetic surgery unless required to correct a condition resulting from an injury or a birth defect
• Occupational injuries and illnesses that are otherwise covered under a Workers' Compensation law
• Routine dental and vision care (care required for treatment of an injury and dental and eye surgery are frequently covered, however)

Other common exclusions relate to benefits provided by government agencies (e.g., VA hospitals) and expenses paid under other insurance programs, including Medicare and Personal Injury Protection Coverage under your Personal Automobile Policy.

What is a pre-existing conditions clause and what is the effect of its inclusion in major medical expense plans?

A preexisting condition is often defined as a medical condition (i.e., an injury or illness) for which treatment was received or recommended during the 6 months prior to the insured's effective date of coverage under a health plan.

A preexisting conditions clause excludes coverage for preexisting conditions for possibly as long as 12 months after the effective date of coverage, but can be shorter. Pregnancy is not a pre-existing condition.

Homeowners FAQs

What is homeowners insurance and who should buy it?

Homeowners Insurance is one of the most popular forms of personal insurance on the market. The typical homeowners policy has two main sections: Section I covers your property, and Section II provides personal liability coverage (to cover you in case of lawsuits arising from things that happen on and off your property). Almost anyone who owns or rents property should have this type of insurance.

What is the difference between "actual cash value" and "replacement cost"?

Covered losses under a homeowner's policy can be paid on either an actual cash value basis or on a replacement cost basis. When "actual cash value" is used, the policy owner is entitled to the depreciated value of the damaged property - so the older the item is, the less money you may receive for it. Under the "replacement cost" coverage, the policy owner is reimbursed the amount it costs to replace the property with something of a similar type and quality at current prices.

What are the limits in the standard Homeowners Policy?

(Note: this answer is based on the Insurance Services Office's HO-3 policy.) Coverage A and B cover your dwelling and other structures on the premises subject to certain exclusions. On HO form 3 Special Form any peril NOT excluded would be covered.

You set the limit for Coverage A when you buy the policy. The Coverage B limit is usually equal to 10% of the policy limit on Coverage A. Coverage C covers losses to your personal property on a "named perils" basis, which means you're covered for all the perils specifically named on your policy. The policy limit on Coverage C is equal to 50% of the policy limit on Coverage A. Coverage D covers extra expenses you may incur when the residence can't be used because of an insured loss. The policy limit for Coverage D is equal to 20% of the policy limit on Coverage A. You choose the Coverage E - personal liability -limit when you buy the policy. The limit on Coverage F - medical payments to others - is usually set at $1000 per injured person. Individual companies may vary. Additional amounts of coverage can be purchased as needed.

Where and when is my personal property covered?

Coverage C, the named perils coverage, applies to all your personal property (except property specifically excluded) at your described premises up to the limit of the policy. Usually property away from your property would be covered up to 10% of the contents limit.

What can I do to lower the cost of my homeowners insurance?

Look for discounts that apply to you. For example, many insurers will offer a discount when you buy both your automobile and homeowners insurance from them. Some insurers offer discounts if you have deadbolt exterior locks on all your doors, or if your home has a security system. Another easy way to save is to raise your deductible. Increasing your deductible from $250 to $500 will lower your premium, sometimes by as much as five or ten percent. However, you should be sure you have enough cash on hand to cover the larger deductible in case of emergency.

Auto FAQs

What exactly does my auto insurance policy cover?

Before the 1950's, if you wanted to purchase all the coverage today's auto insurance policy provides, you would have had to purchase at least four separate policies. Changes in the laws that regulate the sale of insurance now allow the insurance industry to sell policies that combine the separate parts into one all-encompassing policy. The main advantages of combining the parts are lower expenses, and therefore a lower cost to consumers, and the convenience of being able to purchase Liability, Medical Payments, Personal Injury Protection (PIP-a/k/a no-fault benefits) and physical damage coverages in one convenient package policy.

Part A of an auto policy is liability coverage that protects you from lawsuits arising from negligent operation or ownership of a covered automobile. There are two types of coverage in Part A - bodily injury liability (BI) and property damage liability (PD).

• BI covers the bodily injury claims of people you negligently injure in an accident.
• PD covers any third party property damage claims the courts determine you must pay.

Part B provides medical payments to you and any other passengers of your vehicle that are injured in your vehicle. It is separate from liability and no-fault coverages and is sometimes referred to as "good will" insurance. It is quite inexpensive, and provides an additional cushion of coverage above your no-fault coverage limit.

Part C provides uninsured motorist and underinsured motorist protection for the policy owner. Uninsured motorist coverage provides coverage to you for your injuries sustained in an accident with another party who does not have any insurance to cover this accident. Under-insured coverage gives you protection in the event the other driver does not have adequate liability insurance to cover you. You have the option to purchase limits for Part C up to your liability limit of Part A of your policy. We highly recommend this option!

Both B and C are designed to compensate you when the negligent driver doesn't have enough liability insurance under his/her policy. In New York State, Part C covers only bodily injury losses, but property damage losses are included in some states.

Part D Coverage for Damage to Your Auto covers damages to your car when it is involved in an accident. This is where collision and other than collision (Comprehensive) coverages are found, as well as towing and labor and transportation coverages.

Part E of the policy cover your Duties after an accident or loss.

Another important component of the Personal Auto Policy in New York and most other states is Personal Injury Protection (PIP), also sometimes referred as no-fault. You and the passengers in your car are covered for their injuries sustained in an accident. Your auto policy pays, regardless of who is at fault. Coverage includes medical expenses, loss of earnings, and necessary expenses arising as a direct result of the accident. Basic coverage usually starts at $50,000., but higher limits may be purchased, and coverages may also be extended to accidents occurring out of state.

I have an older car whose current market value is very low - do I really need to purchase automobile insurance?

This is a two part answer!

Most states have enacted compulsory insurance laws that require drivers to purchase liability insurance (Part A) minimum limits established by law. These laws were enacted to ensure that victims of accidents are compensated when their losses are caused by someone else being negligent. Most people purchase limits well above and beyond the minimum amounts established by their state legislature. This makes sense since the price to increase is very reasonable, and most minimum limit requirements don't come close to protecting you adequately in the event of a lawsuit.

The second part of this question has one answer: "It depends!” You need to determine the current market value of the vehicle in question in order to determine if it makes sense for you to purchase collision and other than collision (comprehensive) coverage on the vehicle. By way of example, say you own a 1998 vehicle that has an actual cash value (ACV) of $2,000 and the cost for collision coverage is $500. You also have a deductible of $500. If you total the vehicle the insurance company would pay you $1,500 leaving you with a net of $1,000. (remember the cost of the coverage?). Bottom line-spend your money wisely when it comes to the purchase of insurance coverages.

Suppose I lend my car to a friend; is that covered under my auto insurance policy?

Whenever you knowingly loan your car to a friend or an associate (permissive use), he or she will be covered under your policy. A resident spouse is covered as are any family members residing in your household.

What does my auto insurance policy cover when I rent a car?

Since the majority of our customers have auto insurance policies issued in New York State, we will address this topic for New York drivers ONLY. Good news! Contained within the body of the policy that you purchased is an endorsement titled "Rental Vehicle Coverage Endorsement-New York" (It's form PP 03 46 06). This endorsement affords extensive coverage to the policyholder for rental vehicles. The liability coverage on your policy extends automatically to the rental vehicle on your behalf! But that's not all. The endorsement also covers you for actual damages to the vehicle (collision, theft, vandalism, etc.) including loss of use and diminution of value claimed by the rental car company! The rental term must be for not longer than 30 consecutive days and applies anywhere in the United States, its territories or possessions, and Canada. It's great coverage at no additional cost to you, and it is automatically included in your New York personal auto policy.

What is the difference between collision physical damage coverage and comprehensive physical damage coverage?

Both collision and other than collision (comprehensive) coverages are in Part D. Collision is defined as losses you incur when your auto collides with another car or object. For example, if you hit a car in a parking lot, damages to your car will be paid under your collision coverage. Comprehensive covers most other direct physical damage losses including fire, vandalism, flood, theft, glass breakage, and much more. (It's very comprehensive!). It's important to know the differences between collision and comprehensive coverage to make an informed buying decision. Also keep in mind that your deductibles in these two categories are often different. You also have the option of purchasing a "full glass coverage" option which eliminates your deductible for all glass claims to your vehicle.

What should I do if I have an accident?

Your responsibilities after you have an accident are proscribed both by state law and by your insurance contract.

• Obviously, the first thing you should do is be sure everyone is all right and call an ambulance if needed.
• We always recommend having the police respond to the accident. We've seen many cases where the other party involved insists that the accident is their fault and there is no need to have the police present. Many times their stories change after the accident is cleared up and everyone has left.
• Third, give the other driver(s) involved your name, address, telephone number, and the name of your insurance company and/or your insurance agent. Get this same information from the other driver(s). If possible, keep a camera with you and take pictures of the vehicles and the general scene of the accident.
• Fourth, as soon as possible, contact either your insurance agent or your insurance company to notify them that you have been in an accident.
• Finally, there are conditions in the insurance contract you must satisfy to receive compensation from your insurer. For example, you must cooperate with your insurer during any investigation during the claims settlement process. Not completing any of these actions can result in nonpayment by your insurance company for losses that otherwise would have been covered.

Why does the premium for my auto insurance go up if I have an accident or get a ticket?

Actuaries and statisticians who have studied the behavior of people involved in accidents have shown that people who have either had an accident or received a ticket recently are more likely to have another accident in the next couple of years than people whose recent driving record has been incident-free.

Insurance companies use this information not to punish people, but to charge them a premium that reflects their likelihood of having an accident. People who are more likely to have accidents should expect to pay higher premiums.

What factors affect the cost of my auto insurance?

The type of car you drive, what you use it for, your driving record, where you live and even your marital status can all affect how much your policy will cost. It's all based on numbers; for example, statistics show that married people have fewer and less costly accidents than single people.

What should I consider when buying auto insurance?

Things you should consider when purchasing automobile insurance include:

• Decide how much liability coverage you want to carry. This is highly subjective. The liability levels you have on your other policies can serve as a guideline. Consult a financial professional if you need more advice.
• Determine which optional coverage you will need to feel protected. For example, do you want the optional physical damage coverages in Part D, or is the market value of your car too low to warrant purchasing them?
• Once you have decided what you want, you can now choose from which type of company you want to buy a policy.