Although financial advisors and car insurance marketers have the universal goals of maximizin their incomes while performing their services, the scale of their business is much dissimilar. Car insurance marketers make their income by selling as many contract as they can do. The marketer does his best to make as many policy sales as possible, hence make small amount of money on too many policies sold. Financial planners work differently as the try to make larger money from each of the few number of clients the have. Selling a car insurance policy is not the principal worry of financial advisor, but for her or him auto insurance is one of the essential focus the financial planning course.
Car insurance producers look at car insurance as a way to protect the client when there is a loss to car itself, in the occasion of theft, fire or another loss, in addition to the fact that insurance is the law. Financial advisots look at car insurance as a vital part of their clients risk management process. To the financial advisor a car policy is not to restore the car in the event of loss, but is mostly about shielding the assets and capital of the insured especially against possinble legal proceedings.
A number of car insurance marketers would even recommend to reduce liability insurance as a method to save money. No sound financial advisot will ever make such a recommendation. No way!
When does height matter ?
How higt your liability limits should be is the key concern when you buy auto insurance. Perhaps you need only the minimum liaability limits mandated by the states in situations where
- You looked for heigher limits and the cost was very prohibitive.
- Your current assets / capital is too little to expose you to further lawsuits in the event of at fault car accident.
- You are a hight risk person where no other company wants to insure you except those that insure only at the minimum limits. But, if you have certain amounts of assets and capital, or is expected to have considerable assets or capital, then you must be concerned about the height of your liability limits.
What if you are not wealthy with plenty of assets? For people with modest or no wealth, the height of liability limits should be much of a worry for them. In illinois and many other states, liability insurance includes certain coverages to pay for your bodily injuries in situations when you get stricken by vehicle that is legally uninsured, or, in other instances, is insured but the insurance paid on that vehicle was not enought to cover your bodily injuries.
According to the Insurance Research Council, approcimately 15%to 17% all drivers in the United States are uninsured. Coverages for Uninsured Motoris (UM) and Underinsured Motorist (UIM) vary from state to state with regard to their obligatory status and limit amounts. In Illinois UM is compulsory at the limits of $20,000 for bodily injury per person and $40,000 for bodily injury per accident. Underinsured motorist converage is not mandatory in Illinois but insurance companies must offer that coverage to clients for policies issued with liability over the state limits. Clients can still decline to have higher uninsured/ underinsured motorist but it has to be in writing. As you can see, your liability only policy gives protection for your bodily injuries, and making certain that you have high limits on both liability, UM and UIM can have incredible result on you and your family.
by Ed Sneineh