4th Annual "Allstate America's Best Drivers Report™"
Signals Where the Safest Drivers Cruise
Additional Information:
2008 Data | 2007 Data | 2006 Data | 2005 Data | Allstate Safety Leadership Award®
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NORTHBROOK, Ill., July 1, 2008-
Residents in Sioux Falls, S.D., continued to top the chart as the safest drivers in the U.S., according to the fourth annual "Allstate America's Best Drivers Report™." The average driver in Sioux Falls experiences an auto collision every 14.6 years. Compared to the national likelihood of a collision every 10 years - Sioux Falls motorists are 31.6 percent less likely to have an accident than the national average.
"I am happy to know that our residents are continuing to drive safely, particularly with the July 4th holiday approaching," said Dave Munson, mayor of Sioux Falls. "The quality of our community driver education programs, combined with the careful consideration of our traffic engineering department, goes a long way to make our roadways safe for everyone."
Holding fast to the number two spot for the third consecutive year is Fort Collins, Colo. On average, motorists in Fort Collins experience a car collision every 13.4 years.
For the past four years, Allstate actuaries have conducted an in-depth analysis of company claim data to determine the likelihood drivers in America's 200 largest cities will experience a vehicle collision compared to the national average. Allstate's auto policies represent about 12 percent of all U.S. auto policies, making this report a realistic snapshot of what's happening on America's roadways. This year's report also includes data on male vs. female drivers, and compares drivers in different generations: pre-baby boomer, baby boomers, generation X and generation Y.
"Allstate's America's Best Driver's Report was created to boost the country's discussion on safe driving. Each year, we hope that the report will increase awareness on the importance of being tolerant and attentive behind the wheel. This is also a critical message we must communicate with teen drivers," said Mike Roche, senior vice president, Allstate's Claim Organization.
America's Safest Cities based on Gender And Generation
To add to the country's interest of comparing male vs. female, pre-baby boomer vs. boomer, generation X vs. generation Y, Allstate's Best Drivers report delivers a new category and recognizes the safest cities based on gender and generation. Allstate compared the top 20 cities where Allstate writes auto insurance policies to determine the safest cities based on gender and generation. Tucson, Ariz. received top honors as the safest city for males, females, pre-baby boomers, baby boomers and Gen X. El Paso, TX, landed the number one spot as the safest city for Gen Y drivers, according to Allstate's data.
Males Females
City Average Years
Between Collisions City Average Years
Between Collisions
1. Tucson, Ariz. 11.8 1. Tucson, Ariz. 10.1
2. El Paso, TX 10.6 2. El Paso, TX 9.5
3. Salt Lake City, UT 10.0 3. Jacksonville, Fla. 9.2
4. Jacksonville, Fla. 10.0 4. Salt Lake City, UT 9.1
5. Fort Lauderdale, Fla. 9.7 5. Fort Lauderdale, Fla. 8.8
6. Fort Worth, TX 9.2 6. Fort Worth, TX 8.8
7. San Diego, Calif. 8.9 7. San Diego, Calif. 8.7
8. New York, N.Y. 8.9 8. New York, N.Y. 8.6
9. San Jose, Calif. 8.5 9. Charlotte, N.C. 8.3
10. Charlotte, N.C. 8.4 10. San Jose, Calif. 8.2
Pre Baby Boomers Baby Boomers
City Average Years
Between Collisions City Average Years
Between Collisions
1. Tucson, Ariz. 11.9 1. Tucson, Ariz. 12.2
2. Salt Lake City, UT 11.9 2. Jacksonville, Fla. 11.0
3. El Paso, TX 11.8 3. Salt Lake City, UT 10.8
4. Charlotte, N.C. 11.0 4. El Paso, TX 10.4
5. San Diego, Calif. 10.9 5. Fort Lauderdale, Fla. 10.3
6. Jacksonville, Fla. 10.9 6. Fort Worth, TX 10.1
7. Fort Worth, TX 10.8 7. Charlotte, N.C. 9.8
8. San Jose, Calif. 10.7 8. San Diego, Calif. 9.8
9. Orlando, Fla. 9.7 9. Orlando, Fla. 9.1
10. Fort Lauderdale, Fla. 9.6 10. New York, N.Y. 9.0
Generation X Generation Y
City Average Years
Between Collisions City Average Years
Between Collisions
1. Tucson, Ariz. 11.2 1. El Paso, TX 7.5
2. El Paso, TX 10.5 2. Tucson, Ariz. 7.0
3. Salt Lake City, UT 9.7 3. Salt Lake City, UT 6.9
4. Jacksonville, Fla. 9.6 4. New York, N.Y. 6.6
5. Fort Lauderdale, Fla. 9.3 5. San Diego, Calif. 6.3
6. Fort Worth, TX 9.1 6. San Jose, Calif. 6.2
7. San Diego, Calif. 8.8 7. Jacksonville, Fla. 6.2
8. New York, N.Y. 8.7 8. Fort Worth, TX 6.0
9. San Jose, Calif. 8.5 9. Chicago, Ill. 5.8
10. Orlando, Fla. 8.5 10. Fort Lauderdale, Fla. 5.8
"Arizona is one of the fastest growing states in the country, and over the years, vehicle miles traveled have naturally increased. In 2004, Governor Napolitano created the Governor's Traffic Safety Advisory Council (GTSAC) to bring together safety organizations to develop, promote, and implement cost-effective traffic safety strategies to save lives on all public roads in Arizona. The increased educational programs from state agencies and community safety partners, along with law enforcement details and activities to remove dangerous drivers, have helped create safer motorist behaviors," said Richard Fimbres, director of Governor's Office of Highway Safety in Arizona.
The Top 10
Drivers from Sioux Falls maintained their status as the safest city in this year's report, in addition to increasing their average years between collisions, from 13.7 to 14.6. However, four cities, including three from Michigan, have found a spot on the top 10 list for the first time in the history of the report. Midwestern drivers appear to continue to recognize the importance of driving safely. Half of the 10 top cities are in America's heartland, according to the report.
Rank/City Collision Likelihood
Compared to National
Average Average Years
Between Collisions
1. Sioux Falls, S.D. 31.6% less likely 14.6
2. Fort Collins, Colo. 25.5% less likely 13.4
3. Chattanooga, Tenn. 25.1% less likely 13.3
4. Sterling Heights, Mich. 24.4% less likely 13.2
5. Warren, Mich. 24.0% less likely 13.2
6. Knoxville, Tenn. 23.4% less likely 13.1
7. Grand Rapids, Mich. 22.7% less likely 12.9
8. Cedar Rapids, IA 22.3% less likely 12.9
9. Lexington, Ky. 22.0% less likely 12.8
10. Detroit, Mich. 19.5% less likely 12.4
2007 Competent Commuters by Population
Cities with More Than One Million Residents...
For the fourth consecutive year, drivers in Phoenix, Ariz., are the safest big city commuters, according to Allstate. Phoenix motorists can expect to bump into another vehicle on the roadway every 9.8 years - slightly more frequently than the national average.
Rank/City Collision Likelihood
Compared to National
Average Average Years
Between Collisions
84. Phoenix, Ariz. 1.5% more likely 9.8
112. San Diego, Calif. 9.9% more likely 9.1
126. New York, N.Y. 13.2% more likely 8.8
153. Houston, TX 23.5% more likely 8.1
161. San Antonio, TX 25.7% more likely 8.0
167. Dallas, TX 27.6% more likely 7.8
176. Chicago, Ill. 32.3% more likely 7.6
182. Los Angeles, Calif. 41.5% more likely 7.1
187. Philadelphia, Pa. 50.4% more likely 6.6
Cities with 500,000 to One Million Residents...
Detroit drivers kept their motors roaring safely and topped the list of safest drivers in mid-sized cities with populations between 500,000 to 1,000,000 residents. In addition to making the top 10 list for the first time, drivers in the Motor City increased their average years between collisions to once every 12.4 years. Drivers in all the top 10 cities in this list for mid-sized cities are less likely than the national average to experience a collision.
Rank/City Collision Likelihood
Compared to National
Average Average Years
Between Collisions
10. Detroit, Mich. 19.5 less likely 12.4
25. Milwaukee, Wis. 15.0 less likely 11.8
30. Louisville, Ky. 12.2 less likely 11.4
33. Nashville, Tenn. 10.0 less likely 11.1
39. Tucson, Ariz. 9.3 less likely 11.0
44. Memphis, Tenn. 8.6 less likely 10.9
48. Denver, Colo. 6.6 less likely 10.7
54. Oklahoma City, Okla. 4.9 less likely 10.5
60. Indianapolis, Ind. 3.6 less likely 10.4
67. El Paso, TX 2.2 less likely 10.2
All Pumped Up For Free Gas!
Allstate pumped out free gas today to reward Sioux Falls residents for three consecutive years of safe driving habits according to "Allstate America's Best Drivers Report." Eager drivers lined up before dawn for the chance to get free gas, compliments of Allstate Insurance Company. The mayor of Sioux Falls and other city officials joined local Allstate agents to pump petrol for happy commuters - delivering some unexpected relief from record high gas prices.
Allstate Safety Leadership Award®
Allstate will honor motorists in Sioux Falls, SD., today by presenting Sioux Falls Mayor Dave Munson with the Allstate Safety Leadership Award® as recognition for the safe driving habits of the city's residents.
The City of Sioux Falls will accept the Allstate Safety Leadership Award in recognition of the contributions made by the city to create and foster a safe driving environment for its residents. The award is Allstate's highest public honor, recognizing and promoting public awareness for successful public safety programs. Allstate presents the "Allstate America's Best Driver's Report" and the Allstate Safety Leadership Award to inspire others to take a leadership role in the safety arena.
Crashes Happen
According to the National Highway Traffic Safety Administration (NHTSA), more fatal crashes occur on Saturdays than any other day of the week. Sunday ranked second and Friday came in third. Additionally, most collisions happen between 6 and 9 p.m. From 3 to 6 p.m. ranked second, and 9 p.m. to midnight finished third. The fewest crashes occur between 3 and 6 a.m.
Safe-Driving Tips
Auto crashes in general have declined over the last few years, but crash fatalities still average around an alarming 40,000 every year (source: NHTSA), despite technological advances. A much higher number of crashes result in permanent disability. With the main accident causes being human errors, following are some basic but life-saving reminders drivers should consider:
Avoid disastrous distractions - Safe driving takes concentration. If a driver is talking on a cell phone or changing the radio station, that driver isn't paying enough attention to the road. Distracted driving is a factor in 25 to 30 percent of all traffic crashes (source: Network of Employers for Traffic Safety). Take extra care in wild weather - Sometimes, bad weather conditions will contribute to an accident by interfering with visibility, diminishing traction on the surface of the road, or otherwise making it difficult to keep the car under control. A driver always should take the effects of the weather, such as strong cross winds or slippery roads, into consideration when driving. If you snooze, you lose - Drowsy driving causes more than 100,000 crashes each year, resulting in 40,000 injuries and 1,550 deaths on average (source: Network of Employers for Traffic Safety). On summer road trips, set realistic goals for the number of miles traveled each day. Stop at regular intervals when driving long distances. Steer clear of road rage - If one tailgates, flashes high beams, changes lanes without signaling or drives on the shoulder, then he or she is practicing aggressive driving or road rage. Reduce stress on the road by allowing plenty of time for travel, planning your route in advance, and altering your schedule or route to avoid congested roads. Remember not to challenge aggressive drivers and stay as far away from them as possible. Maintenance matters - Ultimately, safety also depends on the maintenance of one's car. Ensure that car brakes, exhaust system, tires, lights, battery and hoses are in good working order. Safety Can Save Money
Allstate is recognizing drivers within Sioux Falls with a celebratory free gas giveaway today. It is also rewarding safe drivers across the country by offering its Allstate® Your Choice Auto® insurance product (not available in California, North Carolina, North Dakota or South Dakota). Allstate® Your Choice Auto® Insurance rewards safe driving through optional features such as a Safe Driver Bonus(SM) where policyholders can get cash off their renewal bill, and Deductible Rewards(SM) where accident-free drivers get $100 off their deductible just for signing up. And for those not able to stay out of harms way, Your Choice Auto® provides enhanced protection through accident forgiveness, where rates don't go up just because of an accident, and new car replacement, where policyholders can get a new car if they total their car in the first three model years. (These features are subject to terms and conditions.)
The Math Behind the Rankings
To create the report, Allstate researchers analyzed internal property damage reported claims over a two-year period (from January 2005 to December 2006) to ensure the findings would not be impacted by external influences such as weather or road construction. A weighted average of the two-year numbers determined the annual percentages. The report defines an auto crash as any collision resulting in a property damage claim.
To view the "Allstate America's Best Drivers Report" in its entirety or to see previous year's results, log onto www.allstate.com.
About Allstate
The Allstate Corporation (NYSE: ALL) is the nation's largest publicly held personal lines insurer. Widely known through the "You're In Good Hands With Allstate®" slogan, Allstate helps individuals in approximately 17 million households protect what they have today and better prepare for tomorrow through approximately 14,900 exclusive agencies and financial representatives in the U.S. and Canada. Customers can access Allstate products and services such as auto insurance and homeowners insurance through Allstate agencies, or in select states at allstate.com and 1-800 Allstate®. Encompass® and Deerbrook® Insurance brand property and casualty products are sold exclusively through independent agents. The Allstate Financial Group provides life insurance, supplemental accident and health insurance, annuity, banking and retirement products designed for individual, institutional and worksite customers that are distributed through Allstate agencies, independent agencies, financial institutions and broker-dealers.
Tuesday, July 1, 2008
Tuesday, May 20, 2008
Motorcycle Insurance
Motorcycle Insurance
Coverage Options
To Get a Quote, contact an Allstate Agent or call 1-877-379-BIKE
There's no way around it: Anytime you're on the road, there’s a chance you might get injured. One of the most important things you can do is make sure your motorcycle insurance coverage can help with medical bills if you should get into an accident.
Medical Payments
Medical Payments typically covers reasonable and necessary medical expenses that are the result of any injury to you or your passengers. Some examples of expenses that might be covered include ambulance, hospital, x-ray, dental, and surgical.
Personal Injury Protection
If you're hurt in an accident, or worse, expenses could add up faster than you imagine. That's where this coverage can help, with reimbursements for:
Medical and hospital expenses
Lost income
Services you would normally do yourself
Funeral expenses
Child care expenses
You're typically covered regardless of who was at fault. Personal Injury Protection is only available in certain states.
Take care of your bike and it’ll take care of you, right? There are three kinds of motorcycle insurance coverage that typically help get your bike back on the road.
Collision
A collision almost always means damage to your motorcycle. And that’s just what this coverage is for.
It typically covers damages to your motorcycle that result from a collision with another object, which could include another car or motorcycle, a tree, or a building.
Comprehensive
It doesn't always take two vehicles to make an accident. Comprehensive Coverage typically covers your bike if it's damaged by:
Flooding
Wind
Vandalism
Theft
Some other reason that doesn't involve a crash with another vehicle
You get to choose the amount of your deductible (the amount you pay before eligible coverage kicks in). Comprehensive Coverage typically covers the cost of repairing or replacing your bike, up to the actual cash value.
Uninsured/Underinsured Motorist Bodily Injury
If an accident isn't your fault, you don't want to pay for the other guy's mistake. Especially if he doesn't have enough insurance coverage or any at all. This coverage typically covers damages that result from the injury or death of you or a passenger on your motorcycle caused by an uninsured or underinsured driver. Different states have different requirements for which coverage to have and how much.
If you’re in an accident, there’s a good chance someone else was involved. And if you’re at fault, you’ll want strong motorcycle liability insurance.
Property Damage Liability
If you're at fault in an accident and cause damage to others’ property, Property Damage Liability Coverage typically covers damages that result from the damage to another person’s property when you are at fault. Some of the things you may be liable for include vehicles, private residences, and storefronts and other structures.
Bodily Injury Liability*
If you’re at fault in a crash, it might be your responsibility to cover the medical bills for your passenger or the other driver. In a case like that, Bodily Injury Liability typically covers damages that result from the injury or death of another driver or a guest passenger on your motorcycle when you are at fault.
Some of the things you may be liable for include medical expenses, lost wages, and pain and suffering. (In most states, bodily injury to guest passengers on your motorcycle is automatically provided under this coverage. In other states, you can pay an additional premium so that Bodily Injury Liability also applies to guest passengers.)
*In some states, bodily injury to a passenger is covered separately under Passenger Liability coverage.
Coverage Options
To Get a Quote, contact an Allstate Agent or call 1-877-379-BIKE
There's no way around it: Anytime you're on the road, there’s a chance you might get injured. One of the most important things you can do is make sure your motorcycle insurance coverage can help with medical bills if you should get into an accident.
Medical Payments
Medical Payments typically covers reasonable and necessary medical expenses that are the result of any injury to you or your passengers. Some examples of expenses that might be covered include ambulance, hospital, x-ray, dental, and surgical.
Personal Injury Protection
If you're hurt in an accident, or worse, expenses could add up faster than you imagine. That's where this coverage can help, with reimbursements for:
Medical and hospital expenses
Lost income
Services you would normally do yourself
Funeral expenses
Child care expenses
You're typically covered regardless of who was at fault. Personal Injury Protection is only available in certain states.
Take care of your bike and it’ll take care of you, right? There are three kinds of motorcycle insurance coverage that typically help get your bike back on the road.
Collision
A collision almost always means damage to your motorcycle. And that’s just what this coverage is for.
It typically covers damages to your motorcycle that result from a collision with another object, which could include another car or motorcycle, a tree, or a building.
Comprehensive
It doesn't always take two vehicles to make an accident. Comprehensive Coverage typically covers your bike if it's damaged by:
Flooding
Wind
Vandalism
Theft
Some other reason that doesn't involve a crash with another vehicle
You get to choose the amount of your deductible (the amount you pay before eligible coverage kicks in). Comprehensive Coverage typically covers the cost of repairing or replacing your bike, up to the actual cash value.
Uninsured/Underinsured Motorist Bodily Injury
If an accident isn't your fault, you don't want to pay for the other guy's mistake. Especially if he doesn't have enough insurance coverage or any at all. This coverage typically covers damages that result from the injury or death of you or a passenger on your motorcycle caused by an uninsured or underinsured driver. Different states have different requirements for which coverage to have and how much.
If you’re in an accident, there’s a good chance someone else was involved. And if you’re at fault, you’ll want strong motorcycle liability insurance.
Property Damage Liability
If you're at fault in an accident and cause damage to others’ property, Property Damage Liability Coverage typically covers damages that result from the damage to another person’s property when you are at fault. Some of the things you may be liable for include vehicles, private residences, and storefronts and other structures.
Bodily Injury Liability*
If you’re at fault in a crash, it might be your responsibility to cover the medical bills for your passenger or the other driver. In a case like that, Bodily Injury Liability typically covers damages that result from the injury or death of another driver or a guest passenger on your motorcycle when you are at fault.
Some of the things you may be liable for include medical expenses, lost wages, and pain and suffering. (In most states, bodily injury to guest passengers on your motorcycle is automatically provided under this coverage. In other states, you can pay an additional premium so that Bodily Injury Liability also applies to guest passengers.)
*In some states, bodily injury to a passenger is covered separately under Passenger Liability coverage.
Wednesday, May 14, 2008
Teen Drivers
"Allstate America's Teen Driving Hotspots" Study Highlights Metro Areas With Highest Rates of Deadly CrashesStudy release launches Allstate's "Action Against Distraction" campaign, stresses dangers of distracted driving, calls for uniform, national Graduated Driver's License (GDL) laws
Downloads
Teen_driving_hotspots_release.doc05/08/2008 Northbrook, Ill. -
Metro areas in the southern United States scored lowest in a study released today by Allstate Insurance Company that identifies "hotspots" where fatal teen driving crash rates are highest. The release of the study, which includes data for metropolitan areas around the country, kicks off the company's national "Action Against Distraction" safe teen driving campaign.
The "Allstate America's Teen Driving Hotspots" study found that the 10 deadliest hotspots among the nation's 50 largest metro areas are concentrated in the southern United States and include three in Florida. According to the study, the metropolitan areas (a central city and its surrounding counties) that were the deadliest hotspots for fatal teen crashes are:
Tampa/St. Petersburg/Clearwater, Fla.
Orlando/Kissimmee, Fla.
Jacksonville, Fla.
Nashville, Tenn.
Birmingham, Ala.
Phoenix, Ariz.
Kansas City, Mo. (and Kan.)
Atlanta, Ga.
Charlotte, N.C.
Louisville, Ky.
The study examines recent federal crash statistics, Allstate claims data on teen collisions, and U.S. Census bureau statistics to score metro areas across the nation on rates of fatal crashes involving teen drivers.
"The study shouldn't just concern parents and leaders in the nation's deadliest hotspots - car crashes claim the lives of more American teens than anything else coast-to-coast," said George Ruebenson, president, Allstate Protection. "Although some cities post better scores than others, the whole country must take responsibility for addressing this crisis. We feel that state and federal leaders should enact uniform national standards for graduated drivers licensing laws. Further, we must have better conversations with teens about safe driving and set good examples through our own good driving behavior."
Interestingly, the markets scoring best in the study include some of the nation's largest cities. While these metro areas generally had more total fatal accidents than others - including the New York City area with a nation-leading 869 fatal accidents involving teen drivers from 2000 through 2006 - the scores were lower when factored against the size of local teen populations. The best scoring cities are:
San Francisco/Oakland, Calif.
San Jose, Calif.
New York City (including Long Island and northern New Jersey)
Los Angeles, Calif.
Cleveland, Ohio
Milwaukee, Wisc.
Boston, Mass.
Portland, Ore.
Salt Lake City, Utah
Chicago, Ill.
The study also found that, across the U.S., fatal crash rates for teens are double in rural areas compared to cities and suburbs. Nationally, of the 43,437 fatal crashes involving teen drivers from 2000 through 2005, 29,998 were in metro areas. But the average rate of fatal teen crashes in rural areas nationally is 51.5 annually per 100,000 teens, compared to 25.4 in metro areas. The greatest disparities in rural over metro crash rates was seen in Florida, with Delaware and Utah also posting significant differences.
The study was conducted by Allstate in conjunction with Sperling's BestPlaces (www.bestplaces.net), a Portland, Oregon research firm specializing in demographic studies and analysis. A more detailed breakdown on the study results - including other market and state comparisons - can be found here: "Allstate America's Teen Driving Hotspots" Study
Today's release of study findings by Allstate Insurance Company kicks off the company's new national "Action Against Distraction" public awareness and policy campaign, which also calls for a national federal standard for graduated driver licensing (GDL) laws and urges Congress to enact the Safe Teen and Novice Driver Uniform Protection (STANDUP) Act.
In addition, throughout May and June - months leading up to some of the deadliest driving days for teens - Allstate will be conducting teen distracted driving training courses aimed at reducing the impact of distracted driving practices such as texting and talking on the phone while driving. Teens in over a dozen cities throughout the United States will participate in the distracted driving training courses.
According to the National Highway Traffic Safety Administration (NHTSA), an average of more than 17 teens a day die on American roads during June, July and August - the three months with the highest teen crash rates. Nearly 6,000 teens die in car crashes every year, a statistic that hasn't changed in more than a decade. While research shows that both parents and teens believe alcohol is the cause of most crashes involving teen drivers, the primary causes of most teen crashes - between 2003 and 2005 - was driver error (87 percent).
To help teens stay safe through prom, graduation, the summer and beyond, parents should initiate a conversation about smart driving. This conversation can include completion of a Parent-Teen Driving Contract, which helps set guidelines for smart driving and consequences for not living up to those expectations. Parents and teens can fill out the interactive contract - setting their own expectations and consequences - online at www.allstate.com/teen.
Research conducted by the National Institute of Child Health and Human Development indicates intervention materials, including parent-teen driving agreements, increase parental restriction of high-risk teen driving conditions among newly licensed drivers.
Allstate also urges state lawmakers to enact better state-level GDL laws that allow novice drivers to gain driving experience gradually and under low-risk situations. An effective tool for saving lives, GDL laws typically involve longer periods of supervised driving, restrictions on late-night driving, limits on teen passengers and cell phone bans for drivers.
Downloads
Teen_driving_hotspots_release.doc05/08/2008 Northbrook, Ill. -
Metro areas in the southern United States scored lowest in a study released today by Allstate Insurance Company that identifies "hotspots" where fatal teen driving crash rates are highest. The release of the study, which includes data for metropolitan areas around the country, kicks off the company's national "Action Against Distraction" safe teen driving campaign.
The "Allstate America's Teen Driving Hotspots" study found that the 10 deadliest hotspots among the nation's 50 largest metro areas are concentrated in the southern United States and include three in Florida. According to the study, the metropolitan areas (a central city and its surrounding counties) that were the deadliest hotspots for fatal teen crashes are:
Tampa/St. Petersburg/Clearwater, Fla.
Orlando/Kissimmee, Fla.
Jacksonville, Fla.
Nashville, Tenn.
Birmingham, Ala.
Phoenix, Ariz.
Kansas City, Mo. (and Kan.)
Atlanta, Ga.
Charlotte, N.C.
Louisville, Ky.
The study examines recent federal crash statistics, Allstate claims data on teen collisions, and U.S. Census bureau statistics to score metro areas across the nation on rates of fatal crashes involving teen drivers.
"The study shouldn't just concern parents and leaders in the nation's deadliest hotspots - car crashes claim the lives of more American teens than anything else coast-to-coast," said George Ruebenson, president, Allstate Protection. "Although some cities post better scores than others, the whole country must take responsibility for addressing this crisis. We feel that state and federal leaders should enact uniform national standards for graduated drivers licensing laws. Further, we must have better conversations with teens about safe driving and set good examples through our own good driving behavior."
Interestingly, the markets scoring best in the study include some of the nation's largest cities. While these metro areas generally had more total fatal accidents than others - including the New York City area with a nation-leading 869 fatal accidents involving teen drivers from 2000 through 2006 - the scores were lower when factored against the size of local teen populations. The best scoring cities are:
San Francisco/Oakland, Calif.
San Jose, Calif.
New York City (including Long Island and northern New Jersey)
Los Angeles, Calif.
Cleveland, Ohio
Milwaukee, Wisc.
Boston, Mass.
Portland, Ore.
Salt Lake City, Utah
Chicago, Ill.
The study also found that, across the U.S., fatal crash rates for teens are double in rural areas compared to cities and suburbs. Nationally, of the 43,437 fatal crashes involving teen drivers from 2000 through 2005, 29,998 were in metro areas. But the average rate of fatal teen crashes in rural areas nationally is 51.5 annually per 100,000 teens, compared to 25.4 in metro areas. The greatest disparities in rural over metro crash rates was seen in Florida, with Delaware and Utah also posting significant differences.
The study was conducted by Allstate in conjunction with Sperling's BestPlaces (www.bestplaces.net), a Portland, Oregon research firm specializing in demographic studies and analysis. A more detailed breakdown on the study results - including other market and state comparisons - can be found here: "Allstate America's Teen Driving Hotspots" Study
Today's release of study findings by Allstate Insurance Company kicks off the company's new national "Action Against Distraction" public awareness and policy campaign, which also calls for a national federal standard for graduated driver licensing (GDL) laws and urges Congress to enact the Safe Teen and Novice Driver Uniform Protection (STANDUP) Act.
In addition, throughout May and June - months leading up to some of the deadliest driving days for teens - Allstate will be conducting teen distracted driving training courses aimed at reducing the impact of distracted driving practices such as texting and talking on the phone while driving. Teens in over a dozen cities throughout the United States will participate in the distracted driving training courses.
According to the National Highway Traffic Safety Administration (NHTSA), an average of more than 17 teens a day die on American roads during June, July and August - the three months with the highest teen crash rates. Nearly 6,000 teens die in car crashes every year, a statistic that hasn't changed in more than a decade. While research shows that both parents and teens believe alcohol is the cause of most crashes involving teen drivers, the primary causes of most teen crashes - between 2003 and 2005 - was driver error (87 percent).
To help teens stay safe through prom, graduation, the summer and beyond, parents should initiate a conversation about smart driving. This conversation can include completion of a Parent-Teen Driving Contract, which helps set guidelines for smart driving and consequences for not living up to those expectations. Parents and teens can fill out the interactive contract - setting their own expectations and consequences - online at www.allstate.com/teen.
Research conducted by the National Institute of Child Health and Human Development indicates intervention materials, including parent-teen driving agreements, increase parental restriction of high-risk teen driving conditions among newly licensed drivers.
Allstate also urges state lawmakers to enact better state-level GDL laws that allow novice drivers to gain driving experience gradually and under low-risk situations. An effective tool for saving lives, GDL laws typically involve longer periods of supervised driving, restrictions on late-night driving, limits on teen passengers and cell phone bans for drivers.
Tuesday, May 13, 2008
Social Security
5 Things to Know About Social Security
When it comes to something as important as Social Security, it’s good to know you’re getting as much from it as possible. Here are five key facts to remember:
1. Your payments will be bigger if you wait until your full retirement age.
You can start taking Social Security payments as soon as you turn 62, but your benefits will be reduced 20 to 30%. That’s a big chunk, especially if you expect to spend many years in retirement. You might consider working a bit longer or relying on your retirement savings to help cover your living expenses until you can receive full benefits.
What's Your "Full Retirement Age?"
If you were born in... It's...
1937 or earlier 65
1938 65 + 2 months
1939 65 + 4 months
1940 65 + 6 months
1941 65 + 8 months
1942 65 + 10 months
1943-1954 66
1955 66 + 2 months
1956 66 + 4 months
1957 66 + 6 months
1958 66 + 8 months
1959 66 + 10 months
1960 or later 67
2. You can work while getting Social Security.
As long as you’re 62, you have the option to take Social Security. If you earn more than $13,560 a year between age 62 and your full retirement age, your benefit payments will be temporarily lowered, based on how much you earn. Say you earn $10,000 over the limit. Your benefits would be reduced by $5,000. If you make $20,000 over the limit, they would be reduced by $10,000. (The limit gets updated each year.)
The good news is that you don’t actually lose out on those benefits. Instead, your payment amount is recalculated so that you receive more money later on. It’s another way working in retirement can help stretch out your income over time.
3. Your payments won’t start automatically.
The two rules above mean it makes the most sense for you to tell the Social Security Administration when you’re ready to start receiving monthly benefits. You can do that over the phone (1-800-772-1213), in person, or through the Social Security online application.
4. Your benefits could be taxed.
Only a third of Social Security beneficiaries end up paying taxes on their benefits. It all depends on the earnings listed on your income tax return. If you file with more than $25,000 as an individual (or $32,000 jointly), you’ll have to pay federal income taxes on your benefits. The rules for state income taxes vary from state to state.
5. Your payments can help your family, too.
Let’s say your monthly benefits turn out to be three times as much as your spouse’s. (It’s a common scenario, especially in families where one spouse paused their career to stay home with the kids.) If she waits until her full retirement age to start getting benefits, her payments will be raised so they equal half of yours.
After you die, your spouse will get either your monthly benefit check or hers—whichever is more. And if you have disabled children, kids under age 19, or elderly parents who depend on you for at least half their income, they could receive "survivor benefits."
Read more on the Social Security Administration’s website.
When it comes to something as important as Social Security, it’s good to know you’re getting as much from it as possible. Here are five key facts to remember:
1. Your payments will be bigger if you wait until your full retirement age.
You can start taking Social Security payments as soon as you turn 62, but your benefits will be reduced 20 to 30%. That’s a big chunk, especially if you expect to spend many years in retirement. You might consider working a bit longer or relying on your retirement savings to help cover your living expenses until you can receive full benefits.
What's Your "Full Retirement Age?"
If you were born in... It's...
1937 or earlier 65
1938 65 + 2 months
1939 65 + 4 months
1940 65 + 6 months
1941 65 + 8 months
1942 65 + 10 months
1943-1954 66
1955 66 + 2 months
1956 66 + 4 months
1957 66 + 6 months
1958 66 + 8 months
1959 66 + 10 months
1960 or later 67
2. You can work while getting Social Security.
As long as you’re 62, you have the option to take Social Security. If you earn more than $13,560 a year between age 62 and your full retirement age, your benefit payments will be temporarily lowered, based on how much you earn. Say you earn $10,000 over the limit. Your benefits would be reduced by $5,000. If you make $20,000 over the limit, they would be reduced by $10,000. (The limit gets updated each year.)
The good news is that you don’t actually lose out on those benefits. Instead, your payment amount is recalculated so that you receive more money later on. It’s another way working in retirement can help stretch out your income over time.
3. Your payments won’t start automatically.
The two rules above mean it makes the most sense for you to tell the Social Security Administration when you’re ready to start receiving monthly benefits. You can do that over the phone (1-800-772-1213), in person, or through the Social Security online application.
4. Your benefits could be taxed.
Only a third of Social Security beneficiaries end up paying taxes on their benefits. It all depends on the earnings listed on your income tax return. If you file with more than $25,000 as an individual (or $32,000 jointly), you’ll have to pay federal income taxes on your benefits. The rules for state income taxes vary from state to state.
5. Your payments can help your family, too.
Let’s say your monthly benefits turn out to be three times as much as your spouse’s. (It’s a common scenario, especially in families where one spouse paused their career to stay home with the kids.) If she waits until her full retirement age to start getting benefits, her payments will be raised so they equal half of yours.
After you die, your spouse will get either your monthly benefit check or hers—whichever is more. And if you have disabled children, kids under age 19, or elderly parents who depend on you for at least half their income, they could receive "survivor benefits."
Read more on the Social Security Administration’s website.
Protection
4 Simple Ways to Protect Your Home
It could be the biggest purchase you ever make. Here are four simple, but crucial, ways to protect your home for the future.
Protect your mortgage.
Thirty years is a long time, and life is full of surprises. Do you know how you’d make your mortgage payment if you were out of work for several months, if a health crisis drained your savings, or if you or your spouse were to die? Make a back-up plan now, and you’ll thank yourself later.
Many families rely on life insurance or annuities to protect their mortgage. They factor in the mortgage balance when deciding what level of benefits they need. You can also use savings accounts and money-market funds to make sure funds are available for short-term needs.
How about your home equity loan? If you have a line of credit, you can use the money for anything you want—to fund vacations, pay off credit cards, or cover other shortfalls. But keep in mind that you’re putting your house on the line. Decide ahead of time how large a monthly payment you can afford, and make sure you stay below that amount.
Learn to love preventive maintenance.
Cleaning out air filters and testing smoke alarms are no one’s idea of fun, but they could save you big bucks (and headaches) in the long run.
The biggest hurdle is often organization—knowing what to do and when to do it. There are standard recommendations for how often to do most repair and maintenance tasks. (Clean your furnace or air filter every three months. Test your circuit breakers twice a year. Drain the sediments from your water heater once a year. You get the idea.)
A good home-maintenance guide will tell you what you need to do and how often each task should be done. Browse through a couple books at the library or bookstore. Then grab your calendar, and you’re ready to get started. Mark down the date you do each task, then count forward and mark the next "due date." Follow the schedule and your house will stay in great condition for decades to come.
Here are three popular books to get you started: How Your House Works, The Ultimate Guide to Home Repair & Improvement, and Home Maintenance for Dummies.
Don’t skimp on insurance.
If you haven’t taken a close look at your homeowners insurance policy, now is the time. Homeowners insurance is required whenever you have a mortgage. Your house is collateral for the loan, so your lender wants to be sure it’s protected. But you should make sure that the policy fits your needs, too.
Make sure your belongings and your valuables are protected, not just the home itself. Clarify exactly what the insurance does and doesn’t cover. Take note of the coverage limits on your current policy, and be sure they’re still appropriate. While you’re at it, see if you qualify for new discounts—especially if you’ve had a theft-protection system installed.
Keep the home’s resale value in mind.
Buying a home opens up all kinds of exciting possibilities, but unless you plan to live out your days in that house, you’ll need to keep its future market value in mind.
Watch out for hot housing markets whose prices could plummet suddenly. Be honest with yourself about how much house you can afford. Use a mortgage calculator ahead of time and stick to that number even if your lender pre-approves a higher amount. And later on, keep future owners in mind when you renovate. (They might not love that aquamarine kitchen tile as much as you.)
It could be the biggest purchase you ever make. Here are four simple, but crucial, ways to protect your home for the future.
Protect your mortgage.
Thirty years is a long time, and life is full of surprises. Do you know how you’d make your mortgage payment if you were out of work for several months, if a health crisis drained your savings, or if you or your spouse were to die? Make a back-up plan now, and you’ll thank yourself later.
Many families rely on life insurance or annuities to protect their mortgage. They factor in the mortgage balance when deciding what level of benefits they need. You can also use savings accounts and money-market funds to make sure funds are available for short-term needs.
How about your home equity loan? If you have a line of credit, you can use the money for anything you want—to fund vacations, pay off credit cards, or cover other shortfalls. But keep in mind that you’re putting your house on the line. Decide ahead of time how large a monthly payment you can afford, and make sure you stay below that amount.
Learn to love preventive maintenance.
Cleaning out air filters and testing smoke alarms are no one’s idea of fun, but they could save you big bucks (and headaches) in the long run.
The biggest hurdle is often organization—knowing what to do and when to do it. There are standard recommendations for how often to do most repair and maintenance tasks. (Clean your furnace or air filter every three months. Test your circuit breakers twice a year. Drain the sediments from your water heater once a year. You get the idea.)
A good home-maintenance guide will tell you what you need to do and how often each task should be done. Browse through a couple books at the library or bookstore. Then grab your calendar, and you’re ready to get started. Mark down the date you do each task, then count forward and mark the next "due date." Follow the schedule and your house will stay in great condition for decades to come.
Here are three popular books to get you started: How Your House Works, The Ultimate Guide to Home Repair & Improvement, and Home Maintenance for Dummies.
Don’t skimp on insurance.
If you haven’t taken a close look at your homeowners insurance policy, now is the time. Homeowners insurance is required whenever you have a mortgage. Your house is collateral for the loan, so your lender wants to be sure it’s protected. But you should make sure that the policy fits your needs, too.
Make sure your belongings and your valuables are protected, not just the home itself. Clarify exactly what the insurance does and doesn’t cover. Take note of the coverage limits on your current policy, and be sure they’re still appropriate. While you’re at it, see if you qualify for new discounts—especially if you’ve had a theft-protection system installed.
Keep the home’s resale value in mind.
Buying a home opens up all kinds of exciting possibilities, but unless you plan to live out your days in that house, you’ll need to keep its future market value in mind.
Watch out for hot housing markets whose prices could plummet suddenly. Be honest with yourself about how much house you can afford. Use a mortgage calculator ahead of time and stick to that number even if your lender pre-approves a higher amount. And later on, keep future owners in mind when you renovate. (They might not love that aquamarine kitchen tile as much as you.)
Life Documents
5 Financial Documents You Need to Have
Don't wait until an emergency happens to start getting your affairs in order. Start with these five key documents:
Will
You need a will. It will properly explain your wishes to everyone you leave behind, sparing your family emotional strain during an already difficult time. If you have children, a will is an absolute must. If you and your spouse were both to pass away, this is the document that will say who you want to become their legal guardians. That’s definitely not something you want left up to the courts.
A lawyer can help you draw up your will, or you might consider using a will-making computer program. Once you have the will, take a look at it every few years and update it whenever there’s a significant change in your life, like marriage or divorce, a new child, or a change in your preferences.
Health Care Proxy
A health care proxy gives the person you choose the legal right to make health care decisions for you if you aren’t able to make them for yourself (for instance, if you’re unable to communicate). Be sure the person you choose knows your wishes and will respect them, regardless of their own views.
Living Will
Living wills are more specific than health care proxies. Their purpose is to clearly explain to hospital staff what sort of medical treatment you want if you’re terminally ill or can’t communicate on your own. Say you had a life-threatening health problem and were rushed to the hospital. They would provide you with a form like this to fill out, but if you were unconscious you wouldn’t be able to. It’s really important to have this document ahead of time.
Durable Power of Attorney
This document makes the person named in it your “attorney-in-fact” and gives them permission to make legal and financial decisions in your place. Just like with a will, this is incredibly important if you have children. As with all these documents, name your choice carefully.
Emergency Information Sheet
If something happens unexpectedly, this will give all the information someone needs to contact your family, find your other four key documents, and take care of the things that need to be taken care of. Include names, phone numbers, and addresses of your doctor, your hospital, and the person you’ve chosen as your health care proxy. Label everything clearly. Even a stranger should be able to understand.
Don't wait until an emergency happens to start getting your affairs in order. Start with these five key documents:
Will
You need a will. It will properly explain your wishes to everyone you leave behind, sparing your family emotional strain during an already difficult time. If you have children, a will is an absolute must. If you and your spouse were both to pass away, this is the document that will say who you want to become their legal guardians. That’s definitely not something you want left up to the courts.
A lawyer can help you draw up your will, or you might consider using a will-making computer program. Once you have the will, take a look at it every few years and update it whenever there’s a significant change in your life, like marriage or divorce, a new child, or a change in your preferences.
Health Care Proxy
A health care proxy gives the person you choose the legal right to make health care decisions for you if you aren’t able to make them for yourself (for instance, if you’re unable to communicate). Be sure the person you choose knows your wishes and will respect them, regardless of their own views.
Living Will
Living wills are more specific than health care proxies. Their purpose is to clearly explain to hospital staff what sort of medical treatment you want if you’re terminally ill or can’t communicate on your own. Say you had a life-threatening health problem and were rushed to the hospital. They would provide you with a form like this to fill out, but if you were unconscious you wouldn’t be able to. It’s really important to have this document ahead of time.
Durable Power of Attorney
This document makes the person named in it your “attorney-in-fact” and gives them permission to make legal and financial decisions in your place. Just like with a will, this is incredibly important if you have children. As with all these documents, name your choice carefully.
Emergency Information Sheet
If something happens unexpectedly, this will give all the information someone needs to contact your family, find your other four key documents, and take care of the things that need to be taken care of. Include names, phone numbers, and addresses of your doctor, your hospital, and the person you’ve chosen as your health care proxy. Label everything clearly. Even a stranger should be able to understand.
Life Changes
How Often Should You Adjust Your Life Insurance Policy?
The whole point of life insurance is that you never know when you’ll need it. So even though your policy might be long-term, you need to make sure it offers the right amount of benefits for your current situation.
A good rule of thumb is to recalculate your life insurance needs once a year, or more often if there’s a major change in your life. Here are some examples:
The Things You Own
Whether you’re married or single, it’s good to know that your finances will be resolved if you should die unexpectedly. That could mean paying off loans or a mortgage, and it’s especially important if you have a lot of debt or want your family to keep living in your home.
Take another look at your policy when:
You buy or sell a home
You take on new debt
Family Matters
You'll want to know that your family's financial needs will be covered if you’re no longer able to provide for them. You'll need the most life insurance when your kids are growing—enough to last them until they become adults and cover their college education. This is even more important if you're the main breadwinner.
Consider raising or lowering your coverage when:
You get married or divorced
You have a baby
Your children become financially independent
Your children finish college
Your long-term goals change
Work Life
The general rule for life insurance is that your policy’s “death benefit” (the amount that gets paid to your beneficiaries if you die) should pay seven times your annual salary. The idea is that as your salary changes, your family’s lifestyle changes to match. If you’re self-employed or own a business, you might also have business-related expenses to cover.
Think about adjusting your policy when:
Your salary changes
You start or sell a business
Your spouse’s job changes
The whole point of life insurance is that you never know when you’ll need it. So even though your policy might be long-term, you need to make sure it offers the right amount of benefits for your current situation.
A good rule of thumb is to recalculate your life insurance needs once a year, or more often if there’s a major change in your life. Here are some examples:
The Things You Own
Whether you’re married or single, it’s good to know that your finances will be resolved if you should die unexpectedly. That could mean paying off loans or a mortgage, and it’s especially important if you have a lot of debt or want your family to keep living in your home.
Take another look at your policy when:
You buy or sell a home
You take on new debt
Family Matters
You'll want to know that your family's financial needs will be covered if you’re no longer able to provide for them. You'll need the most life insurance when your kids are growing—enough to last them until they become adults and cover their college education. This is even more important if you're the main breadwinner.
Consider raising or lowering your coverage when:
You get married or divorced
You have a baby
Your children become financially independent
Your children finish college
Your long-term goals change
Work Life
The general rule for life insurance is that your policy’s “death benefit” (the amount that gets paid to your beneficiaries if you die) should pay seven times your annual salary. The idea is that as your salary changes, your family’s lifestyle changes to match. If you’re self-employed or own a business, you might also have business-related expenses to cover.
Think about adjusting your policy when:
Your salary changes
You start or sell a business
Your spouse’s job changes
Thursday, February 21, 2008
10 Most Stolen Cars
10 Most Stolen Cars
A car is stolen every 26 seconds in America. Nearly half of these are never recovered, having been scrapped for parts or smuggled to another country. Anti-theft devices can help deter criminals, but as the technology of car alarms progresses, so does the crafty nature of auto thieves.
The chances of your car being stolen are approximately 190 to 1. Of course, this number fluctuates based on where you live and what sort of car you drive. The chances that someone wants your rusted El Camino are pretty slim, but that shiny new Escalade in the driveway is awfully tempting to a would-be car thief. Cars with a good market value, whether they are flashy or just practical, are always the most coveted.
The following is a list of the most stolen vehicles in America in 2005, according to the National Insurance Crime Bureau (NICB). These cars are model years 2003 – 2005.
1. Honda Civic
2. Toyota Camry
3. Honda Accord
4. Dodge Caravan
5. Chevrolet C/K 1500
6. Ford F-150
7. Dodge Ram Pickup
8. Acura Integra
9. Toyota Pickup
10. Nissan Sentra
A car is stolen every 26 seconds in America. Nearly half of these are never recovered, having been scrapped for parts or smuggled to another country. Anti-theft devices can help deter criminals, but as the technology of car alarms progresses, so does the crafty nature of auto thieves.
The chances of your car being stolen are approximately 190 to 1. Of course, this number fluctuates based on where you live and what sort of car you drive. The chances that someone wants your rusted El Camino are pretty slim, but that shiny new Escalade in the driveway is awfully tempting to a would-be car thief. Cars with a good market value, whether they are flashy or just practical, are always the most coveted.
The following is a list of the most stolen vehicles in America in 2005, according to the National Insurance Crime Bureau (NICB). These cars are model years 2003 – 2005.
1. Honda Civic
2. Toyota Camry
3. Honda Accord
4. Dodge Caravan
5. Chevrolet C/K 1500
6. Ford F-150
7. Dodge Ram Pickup
8. Acura Integra
9. Toyota Pickup
10. Nissan Sentra
Thursday, February 14, 2008
Life Insurance
What are accelerated benefits?
Since the 1980s, many life insurance companies have offered terminally ill insureds an what has been come to be known as an “accelerated death benefits option”. The Accelerated Death Benefit allows the policy owner to receive, in advance of the insured person’s death, a significant portion of the death benefit that otherwise would be paid after death to the beneficiaries. Often as much as 80%, and sometimes more, is available at any time within the last year or two of the person’s projected life.
The funds received from accelerated benefits can be used by the policy owner for any purpose he or she chooses, whether to pay for extra or experimental medical care, to take a trip, to improve a home, hire nursing staff, or anything else.
As accelerated death benefits originally were created as an act of grace (sometimes terms a “policy liberalization”) by the insurance companies, long after the policies were issued, many policies do not mention them. While more recent policies are more apt to have accelerated death benefits provisions built in, do not let the absence of a provision deter you from asking the company if it offers such a benefit if the policy is silent, or a more attractive benefit than the policy itself provides. While practices vary from company to company, sometimes the accelerated death benefits take the form of “loans” and an “assignment” with the balance of the face amount, less any interest, to be paid to the insured's estate on death.
Since the 1980s, many life insurance companies have offered terminally ill insureds an what has been come to be known as an “accelerated death benefits option”. The Accelerated Death Benefit allows the policy owner to receive, in advance of the insured person’s death, a significant portion of the death benefit that otherwise would be paid after death to the beneficiaries. Often as much as 80%, and sometimes more, is available at any time within the last year or two of the person’s projected life.
The funds received from accelerated benefits can be used by the policy owner for any purpose he or she chooses, whether to pay for extra or experimental medical care, to take a trip, to improve a home, hire nursing staff, or anything else.
As accelerated death benefits originally were created as an act of grace (sometimes terms a “policy liberalization”) by the insurance companies, long after the policies were issued, many policies do not mention them. While more recent policies are more apt to have accelerated death benefits provisions built in, do not let the absence of a provision deter you from asking the company if it offers such a benefit if the policy is silent, or a more attractive benefit than the policy itself provides. While practices vary from company to company, sometimes the accelerated death benefits take the form of “loans” and an “assignment” with the balance of the face amount, less any interest, to be paid to the insured's estate on death.
Wednesday, February 13, 2008
Save Money on Homeowners Insurance
18 Ways To Save Money On Your Homeowners Insurance
Call an agent today and review all 18 ways to save money on your Homeowners insurance or any Property insurance. There is a good chance that you may be missing some important discounts that you are entitled to. An agent can help you get the lowest possible premium.
1). Age of Home – If you have a newer home, you may be eligible to pay lower premiums. Also, if you have recently renovated your home and updated your heater, plumbing, wiring and roof, your insurer may now consider your homes age to be only as old as the most recent update on your home. Call your agent for the details.
2). Blanket Endorsement for Jewelry – Insuring jewelry can be expensive if you list each item individually on your policy. Consider a blanket endorsement on your policy that will cover many items of jewelry up to a specified limit on the policy. Often there will be a specific limit per piece of jewelry in addition to the total amount covered. For example, the policy may insure all jewelry in the home up to $10,000 but no more than $2500 for any one piece of jewelry. Contact your agent for more details.
3). Claim-Free – To be eligible for this discount you must be claim free for a period of time. Usually 3 or 5 years.
4). Credit – Your credit plays a major role in determining what your final policy premium will be. Many insurers can no longer give you an accurate quote for a policy until they actually check it out. Insurers used to look at things like your loss or claims history and a few other factors to determine your rate. However, in recent years, insurers have added your credit as a major tool in evaluating what your final premium will be. Generally with these companies, a good insurance score (or good credit score) means a more favorable rate. This practice has gone on in the banking industry for as long as most folks can remember. The philosophy is that a group of risks with good credit in the same area will have fewer losses than a similar group in the same area with bad credit. In today’s insurance marketplace, good credit can mean lower policy premiums.
5). Dead Bolt Lock – Do all exterior doors in your home have a dead bolt lock? If yes, you may qualify for this discount.
6). Dwelling Coverage Amount – Review the dwelling coverage amount on your homeowners’ policy. You could be over-insured. Many insurers base this amount of coverage on the purchase price of the home. If the home is completely destroyed and must be replaced, the land will still be there and the insurer will be rebuilding from the ground up. The land value is often a big part of the purchase price of a home. Also, obtain the exterior square footage of your home, and call your agent to have he or she assess the correct replacement cost of your home. The insurer often obtains the square footage from you and if it is not accurate, your home could be over insured or even worse, underinsured. You want it to be just right. You bear the ultimate responsibility for insuring your home to the proper amount. The dwelling coverage amount is the single most important area of your policy to review with your agent. Call today.
7). Employee Discount – If you are an employee of your insurer or of a company that has a special program with your insurer, you may qualify for a discount or a discounted rating plan.
8). Fire Extinguisher – Homes equipped with fire extinguishers afford the homeowner a great tool to help put out a small fire before the whole house burns down. If you have one, you may be eligible for a discount.
9). Have Your Policy Re-Written – Many insurance companies periodically develop different rating plans and premiums for the same policies. If your policy was re-written with the exact same coverage in the new plan, your rate would likely be different in this newer rating plan. You could pay more or less in the new rating plan. Also, most companies will charge an extra premium for a claim and will continue to charge you until the end of the policy term. This could mean that you could pay significantly more than necessary if you had your policy re-written after the loss is over 3 to 5 years old. Often, there may be some disadvantages to having your policy re-written so check with your agent.
10). Increase Your Deductible – Many policies carry a standard $500 deductible , but you can request a higher deductible such as $750, $1000 or higher and often save a substantial amount of money. By agreeing to be responsible for a bigger part of the total amount of the claim, the insurer will reward you with a lower premium. For many, this is one of the best ways to save money over time. Call your agent for all of your options.
11). Jewelry in Vault – If you insure jewelry on your policy and store it in a vault or safe deposit box when not in use, you may be eligible for a significantly lower premium on those items listed on your policy.
12). Multiple Policies With the Same Company - Many insurers will give you a multi-policy discount if you have more than one line of insurance with them. Consider purchasing your auto, home and life insurance from the same insurer. This will generally also put you in a more favorable position with the company from claims to underwriting.
13). Previous Insurer – Many insurers will give you a discount if you are currently insured with specific insurer and switch to a new insurer. Some insurers do this to try to induce clients to move their company.
14). Rate Territory - Most insurers develop rating territories or areas to help determine what premiums to charge you. You would expect to pay more if you live in a big city than if you live outside the city is an example of this. Check with your agent to make sure that you are being properly rated for the territory that you live in. Often, many rating territories have more than one zip code and even though your policy shows the correct zip code, you could be rated in the wrong county and paying the wrong premium! Call your agent today to explore this often over-looked option.
15). Retired Discount – If you are a certain age (usually 55 or 65 years old & up) and are retired, many insurers will give you a discount on your policy. Don’t miss out on this one if you qualify, it can be a big one and you must call your agent to get credit for the discount.
16). Roof Type – Depending on what type of roof you have, you may qualify for different types of policies from the insurer. For example, if you have a flat roof on your home you may not qualify for the same type of policy as you would if the roof was pitched or an "A" shaped roof. Your roofing material could also be considered as well.
17). Security System – If you purchase a security system for your home, almost every insurer will give you a discount. If your home alarm system is capable of notifying the police and/or the fire department directly should either be triggered, you will generally get a bigger discount for having both. Having either will generally give you a discount as well.
18). Smoke Detector – Homes equipped with smoke detectors save lives and almost all insurance companies will give you a discount if you have them.
Contact Jim Somborovich: js@allstate.com
Call an agent today and review all 18 ways to save money on your Homeowners insurance or any Property insurance. There is a good chance that you may be missing some important discounts that you are entitled to. An agent can help you get the lowest possible premium.
1). Age of Home – If you have a newer home, you may be eligible to pay lower premiums. Also, if you have recently renovated your home and updated your heater, plumbing, wiring and roof, your insurer may now consider your homes age to be only as old as the most recent update on your home. Call your agent for the details.
2). Blanket Endorsement for Jewelry – Insuring jewelry can be expensive if you list each item individually on your policy. Consider a blanket endorsement on your policy that will cover many items of jewelry up to a specified limit on the policy. Often there will be a specific limit per piece of jewelry in addition to the total amount covered. For example, the policy may insure all jewelry in the home up to $10,000 but no more than $2500 for any one piece of jewelry. Contact your agent for more details.
3). Claim-Free – To be eligible for this discount you must be claim free for a period of time. Usually 3 or 5 years.
4). Credit – Your credit plays a major role in determining what your final policy premium will be. Many insurers can no longer give you an accurate quote for a policy until they actually check it out. Insurers used to look at things like your loss or claims history and a few other factors to determine your rate. However, in recent years, insurers have added your credit as a major tool in evaluating what your final premium will be. Generally with these companies, a good insurance score (or good credit score) means a more favorable rate. This practice has gone on in the banking industry for as long as most folks can remember. The philosophy is that a group of risks with good credit in the same area will have fewer losses than a similar group in the same area with bad credit. In today’s insurance marketplace, good credit can mean lower policy premiums.
5). Dead Bolt Lock – Do all exterior doors in your home have a dead bolt lock? If yes, you may qualify for this discount.
6). Dwelling Coverage Amount – Review the dwelling coverage amount on your homeowners’ policy. You could be over-insured. Many insurers base this amount of coverage on the purchase price of the home. If the home is completely destroyed and must be replaced, the land will still be there and the insurer will be rebuilding from the ground up. The land value is often a big part of the purchase price of a home. Also, obtain the exterior square footage of your home, and call your agent to have he or she assess the correct replacement cost of your home. The insurer often obtains the square footage from you and if it is not accurate, your home could be over insured or even worse, underinsured. You want it to be just right. You bear the ultimate responsibility for insuring your home to the proper amount. The dwelling coverage amount is the single most important area of your policy to review with your agent. Call today.
7). Employee Discount – If you are an employee of your insurer or of a company that has a special program with your insurer, you may qualify for a discount or a discounted rating plan.
8). Fire Extinguisher – Homes equipped with fire extinguishers afford the homeowner a great tool to help put out a small fire before the whole house burns down. If you have one, you may be eligible for a discount.
9). Have Your Policy Re-Written – Many insurance companies periodically develop different rating plans and premiums for the same policies. If your policy was re-written with the exact same coverage in the new plan, your rate would likely be different in this newer rating plan. You could pay more or less in the new rating plan. Also, most companies will charge an extra premium for a claim and will continue to charge you until the end of the policy term. This could mean that you could pay significantly more than necessary if you had your policy re-written after the loss is over 3 to 5 years old. Often, there may be some disadvantages to having your policy re-written so check with your agent.
10). Increase Your Deductible – Many policies carry a standard $500 deductible , but you can request a higher deductible such as $750, $1000 or higher and often save a substantial amount of money. By agreeing to be responsible for a bigger part of the total amount of the claim, the insurer will reward you with a lower premium. For many, this is one of the best ways to save money over time. Call your agent for all of your options.
11). Jewelry in Vault – If you insure jewelry on your policy and store it in a vault or safe deposit box when not in use, you may be eligible for a significantly lower premium on those items listed on your policy.
12). Multiple Policies With the Same Company - Many insurers will give you a multi-policy discount if you have more than one line of insurance with them. Consider purchasing your auto, home and life insurance from the same insurer. This will generally also put you in a more favorable position with the company from claims to underwriting.
13). Previous Insurer – Many insurers will give you a discount if you are currently insured with specific insurer and switch to a new insurer. Some insurers do this to try to induce clients to move their company.
14). Rate Territory - Most insurers develop rating territories or areas to help determine what premiums to charge you. You would expect to pay more if you live in a big city than if you live outside the city is an example of this. Check with your agent to make sure that you are being properly rated for the territory that you live in. Often, many rating territories have more than one zip code and even though your policy shows the correct zip code, you could be rated in the wrong county and paying the wrong premium! Call your agent today to explore this often over-looked option.
15). Retired Discount – If you are a certain age (usually 55 or 65 years old & up) and are retired, many insurers will give you a discount on your policy. Don’t miss out on this one if you qualify, it can be a big one and you must call your agent to get credit for the discount.
16). Roof Type – Depending on what type of roof you have, you may qualify for different types of policies from the insurer. For example, if you have a flat roof on your home you may not qualify for the same type of policy as you would if the roof was pitched or an "A" shaped roof. Your roofing material could also be considered as well.
17). Security System – If you purchase a security system for your home, almost every insurer will give you a discount. If your home alarm system is capable of notifying the police and/or the fire department directly should either be triggered, you will generally get a bigger discount for having both. Having either will generally give you a discount as well.
18). Smoke Detector – Homes equipped with smoke detectors save lives and almost all insurance companies will give you a discount if you have them.
Contact Jim Somborovich: js@allstate.com
Thursday, February 7, 2008
Long Term Care Insurance
Long-term Care Insurance
Long-term care refers to the many services beyond medical care and nursing care used by people who have disabilities or chronic (long-lasting) illnesses. Long-term care insurance helps you pay for these services, which can be very expensive. A policy also ensures that you can make your own choices about what long-term care services you receive and where you receive them.
Ordinary health insurance won't cover it.
People are living longer and longer these days. That's good news, but the flip side of that is there are more years in which there's a risk of serious health problems. And that could literally cost all of your remaining life's savings. Unfortunately, ordinary health insurance policies and Medicare usually do not pay for long-term care expenses. Medicaid, a federal/state health insurance program, will only pay for long-term care if you've already spent most of your savings or other assets. So, there's long-term care insurance.
Long-term care insurance typically covers the cost of:
Help in your home with daily activities like bathing, dressing, eating and cleaning.
Community programs, such as adult day care.
Assisted living services that are provided in a special residential setting other than your own home. These services may include meals, health monitoring, and help with daily activities.
Visiting nurses.
Care in a nursing home.
When is the right time to buy a policy?
Many people don't think about long-term care until they get into their 70s and 80s and their health begins to fail. At these ages, you may be too high a risk for an insurer to cover you; or if you do qualify, the premiums can be astronomical. In fact, some long-term care policies have restrictions on age and health status.
The best time to buy long-term care insurance may be middle-age. It's the time when you have the highest likelihood of being eligible for a policy and, just as important, when premiums costs might be lower.
Is a policy right for you?
Long-term care insurance is probably not for everyone, but—with soaring health care costs, insurers increasingly restricting coverage and eligibility, and people's need to stretch retirement savings through more years—it's a good idea to consider it seriously. Your goals should be to protect your assets, minimize your dependence on other family members, and control where and how you receive long-term care services.
On the other hand, consider the cost. Long-term care insurance is expensive. An individual who's 65 years old and in good health can expect to pay between $2,000 and $3,000 a year for a policy that covers nursing home care and home care, with premiums adjusted for inflation. You may not want to buy a policy if the cost of premiums will lower your standard of living or force you to give up other things you need right now. And look ahead, as well. Be sure you'll be able to afford the premiums if your income declines.
Key Issues to Review
Be sure you consider each of these issues:
Coverage. You can choose long-term care policies that pay only for nursing home care, or only for home care. Or, you can opt to purchase coverage for a mixture of care options that includes nursing home, assisted living, and adult day care. Some will pay for a family member or friend to care for you in your home.
Daily or Monthly Benefit. The daily or monthly benefit is the amount of money the insurance company will pay for each day or month you are covered by a long-term care policy. If the cost of care is more than your daily or monthly benefit, you will need to pay the balance out of your own pocket.
Benefit Period. Your benefit period determines the length of time you will receive benefits from your policy. You can choose a benefit period that spans from two to six years, or the rest of your life.
Elimination or Waiting Period. During this period, you must pay all of your long-term care expenses out of your own pocket. This period could last anywhere from 0 to 100 days. The longer the waiting period is, the lower your premiums will be.
Inflation Protection. With health care costs rising to new heights every year, buying a policy without inflation protection is probably buying a policy that won't cover much of your expenses. There are two main kinds of inflation protection: the right to add coverage at a later date; and automatic coverage increases.
Non-Forfeiture Benefit. Policies with this benefit will continue to pay for your care even if you stop paying premiums. This policy feature can add 10 percent to 100 percent to your premium.
Long-term care refers to the many services beyond medical care and nursing care used by people who have disabilities or chronic (long-lasting) illnesses. Long-term care insurance helps you pay for these services, which can be very expensive. A policy also ensures that you can make your own choices about what long-term care services you receive and where you receive them.
Ordinary health insurance won't cover it.
People are living longer and longer these days. That's good news, but the flip side of that is there are more years in which there's a risk of serious health problems. And that could literally cost all of your remaining life's savings. Unfortunately, ordinary health insurance policies and Medicare usually do not pay for long-term care expenses. Medicaid, a federal/state health insurance program, will only pay for long-term care if you've already spent most of your savings or other assets. So, there's long-term care insurance.
Long-term care insurance typically covers the cost of:
Help in your home with daily activities like bathing, dressing, eating and cleaning.
Community programs, such as adult day care.
Assisted living services that are provided in a special residential setting other than your own home. These services may include meals, health monitoring, and help with daily activities.
Visiting nurses.
Care in a nursing home.
When is the right time to buy a policy?
Many people don't think about long-term care until they get into their 70s and 80s and their health begins to fail. At these ages, you may be too high a risk for an insurer to cover you; or if you do qualify, the premiums can be astronomical. In fact, some long-term care policies have restrictions on age and health status.
The best time to buy long-term care insurance may be middle-age. It's the time when you have the highest likelihood of being eligible for a policy and, just as important, when premiums costs might be lower.
Is a policy right for you?
Long-term care insurance is probably not for everyone, but—with soaring health care costs, insurers increasingly restricting coverage and eligibility, and people's need to stretch retirement savings through more years—it's a good idea to consider it seriously. Your goals should be to protect your assets, minimize your dependence on other family members, and control where and how you receive long-term care services.
On the other hand, consider the cost. Long-term care insurance is expensive. An individual who's 65 years old and in good health can expect to pay between $2,000 and $3,000 a year for a policy that covers nursing home care and home care, with premiums adjusted for inflation. You may not want to buy a policy if the cost of premiums will lower your standard of living or force you to give up other things you need right now. And look ahead, as well. Be sure you'll be able to afford the premiums if your income declines.
Key Issues to Review
Be sure you consider each of these issues:
Coverage. You can choose long-term care policies that pay only for nursing home care, or only for home care. Or, you can opt to purchase coverage for a mixture of care options that includes nursing home, assisted living, and adult day care. Some will pay for a family member or friend to care for you in your home.
Daily or Monthly Benefit. The daily or monthly benefit is the amount of money the insurance company will pay for each day or month you are covered by a long-term care policy. If the cost of care is more than your daily or monthly benefit, you will need to pay the balance out of your own pocket.
Benefit Period. Your benefit period determines the length of time you will receive benefits from your policy. You can choose a benefit period that spans from two to six years, or the rest of your life.
Elimination or Waiting Period. During this period, you must pay all of your long-term care expenses out of your own pocket. This period could last anywhere from 0 to 100 days. The longer the waiting period is, the lower your premiums will be.
Inflation Protection. With health care costs rising to new heights every year, buying a policy without inflation protection is probably buying a policy that won't cover much of your expenses. There are two main kinds of inflation protection: the right to add coverage at a later date; and automatic coverage increases.
Non-Forfeiture Benefit. Policies with this benefit will continue to pay for your care even if you stop paying premiums. This policy feature can add 10 percent to 100 percent to your premium.
Tuesday, February 5, 2008
Tax Breaks
Overview Retirement Real Estate College Autos Debt Health Care Insurance Taxes ADVERTISEMENT
by Bill Bischoff
June 9, 2006
THINKING ABOUT PURCHASING your first home? Then you're probably well aware of the potential tax breaks coming your way.
In case you're not, let's review. While the cost of renting is generally a nondeductible expense (except for when part of the home is used for business purposes), homeowners can claim an itemized deduction for interest on up to $1 million worth of mortgage debt used to acquire or improve their principal residence. Ditto for interest on up to $100,000 of home-equity debt secured by their principal residence. Real-estate property taxes can be claimed as an itemized deduction, too. You also can generally deduct any points you paid (or the seller paid on your behalf) to take out the mortgage.
But you probably knew all that, right? Now for the tax-law catches your realtor probably never told you about. Don't worry: What's detailed below probably won't have you running back into the arms of your landlord. But it just might give you a more realistic expectation of how homeownership will affect your future tax bills.
The Standard-Deduction Factor
The first thing to understand is that your actual tax breaks from home ownership may be less than expected if you were claiming the standard deduction before you bought. Why? Because the standard deduction is a tax-law freebie. You don't need to have any personal deductions whatsoever to claim it. For 2006, the standard deduction amounts are $10,300 for joint filers, $5,150 for singles, and $7,550 for heads of households.
When your itemized deductions are less than the standard deduction, you simply forgo itemizing and claim the standard allowance instead. Many folks are in this situation until home ownership triggers deductions for mortgage interest and property taxes. Those write-offs — when added to other itemized deductions for state and local income taxes, personal property taxes, and charitable donations — are usually enough to exceed the standard-deduction amount.
The question is: How much of a tax break did you really reap from your home ownership write-offs? For example, say you're married and would have claimed the joint standard deduction of $10,300. Then you buy a house and pay $12,000 a year for mortgage interest and $2,500 for property taxes. On first blush, you might think you've just lowered your taxable income by a whopping $14,500 ($12,000 + $2,500). Not so fast! Assume you also pay state income taxes of $2,000 and contribute $450 to charities. So your total itemized deductions add up to $16,950 ($12,000 + $2,500 + $2,000 + 450). That's only $6,650 above the standard deduction you would have claimed in the absence of buying a home. So you really netted only $6,650 in additional write-offs vs. the $14,500 you might have expected.
Now, if you were already itemizing before you bought or were very close to doing so, your additional deductions from mortgage interest and property taxes will reduce your taxable income dollar for dollar (or nearly so). The point is: Be sure to consider the standard-deduction factor when calculating your anticipated tax savings. That way, you won't be shocked by an unforeseen tax bill next April.
The High-Income Phaseout Factor
If you're a high earner, you're less likely to be affected by the standard-deduction factor. Why? Because you probably have enough itemized deductions (from state and local taxes and charitable contributions) to exceed the standard-deduction amount even without any write-offs for home-mortgage interest and real-estate property taxes. Instead, you may have to worry about the dreaded deduction-phaseout rule that afflicts high-income types.
Once your 2006 adjusted gross income (AGI) exceeds $150,500 (regardless of whether you file joint or single taxes), the phaseout rule reduces your itemized deductions by 2% of the excess. For instance, say your AGI is $300,000. Your otherwise allowable itemized deductions are reduced by $2,990 [($300,000 - $150,500) x .02]. If your AGI is $500,000, your otherwise allowable itemized deductions are reduced by $6,990 [($500,000 - $150,500) x .02]. You get the idea. Not all itemized deductions are affected by this nasty rule, but mortgage interest and real-estate property taxes are. The law provides that taxpayers can't lose more than 53.33% of their deductions under this rule, but that's small comfort to its victims. In fact, itemized deductions for some high earners are curtailed to the extent they wind up back in the standard-deduction mode. When that happens, they don't receive any actual tax benefit from their mortgage interest and property-tax expenses.
Bottom line: If you expect your AGI to exceed $150,500, you'll need to whip out the calculator to figure your actual home-ownership tax savings. (For 2007, the $150,500 amount will be adjusted for inflation.)
The Home-Equity-Loan Factor
Once you're ensconced in your new home, you may decide to take out a home-equity loan. As mentioned above, you can generally claim an itemized deduction for interest on up to $100,000 worth of home-equity debt. The key word here is generally. The fact is, you can't deduct interest to the extent the home-equity-loan principal plus your first mortgage principal exceeds the value of your home. For example, say your first mortgage is $200,000 and your home-equity loan is $75,000. If your home is worth $250,000, you can deduct interest only on $50,000 worth of home-equity-loan principal. Interest on the remaining $25,000 falls into the nondeductible personal-interest category.
A more likely cause for concern is another rule that disallows any alternative minimum tax, or AMT, deduction for home-equity-loan interest unless the loan proceeds were used to improve your property. For example, say you take out a $50,000 home-equity loan and use the money to pay off a car loan and some credit-card balances. For regular tax purposes, that's fine. You can deduct the home-equity-loan interest on Schedule A, along with the interest on your first mortgage. However, if you're in the AMT mode, you can't deduct any of the home-equity-loan interest in calculating your AMT bill.
On the other hand, if you spend your $50,000 home-equity-loan proceeds on a new pool and covered patio, you're good to go for both regular tax and AMT purposes. And one more thing: The high-income deduction-phaseout rule explained earlier can also whittle down your otherwise allowable home-equity-loan interest deduction.
Home Sweet Home
Now you know all the home-ownership tax angles your realtor was afraid to reveal. Still, buying a home usually works out to be at least a decent proposition taxwise. And it will be much better than decent if you eventually sell for a big tax-free gain down the road. If you're married, you can potentially rake in a federal income-tax free profit of up to $500,000, or $250,000 if you're unhitched. Now that's a sweet deal!
by Bill Bischoff
June 9, 2006
THINKING ABOUT PURCHASING your first home? Then you're probably well aware of the potential tax breaks coming your way.
In case you're not, let's review. While the cost of renting is generally a nondeductible expense (except for when part of the home is used for business purposes), homeowners can claim an itemized deduction for interest on up to $1 million worth of mortgage debt used to acquire or improve their principal residence. Ditto for interest on up to $100,000 of home-equity debt secured by their principal residence. Real-estate property taxes can be claimed as an itemized deduction, too. You also can generally deduct any points you paid (or the seller paid on your behalf) to take out the mortgage.
But you probably knew all that, right? Now for the tax-law catches your realtor probably never told you about. Don't worry: What's detailed below probably won't have you running back into the arms of your landlord. But it just might give you a more realistic expectation of how homeownership will affect your future tax bills.
The Standard-Deduction Factor
The first thing to understand is that your actual tax breaks from home ownership may be less than expected if you were claiming the standard deduction before you bought. Why? Because the standard deduction is a tax-law freebie. You don't need to have any personal deductions whatsoever to claim it. For 2006, the standard deduction amounts are $10,300 for joint filers, $5,150 for singles, and $7,550 for heads of households.
When your itemized deductions are less than the standard deduction, you simply forgo itemizing and claim the standard allowance instead. Many folks are in this situation until home ownership triggers deductions for mortgage interest and property taxes. Those write-offs — when added to other itemized deductions for state and local income taxes, personal property taxes, and charitable donations — are usually enough to exceed the standard-deduction amount.
The question is: How much of a tax break did you really reap from your home ownership write-offs? For example, say you're married and would have claimed the joint standard deduction of $10,300. Then you buy a house and pay $12,000 a year for mortgage interest and $2,500 for property taxes. On first blush, you might think you've just lowered your taxable income by a whopping $14,500 ($12,000 + $2,500). Not so fast! Assume you also pay state income taxes of $2,000 and contribute $450 to charities. So your total itemized deductions add up to $16,950 ($12,000 + $2,500 + $2,000 + 450). That's only $6,650 above the standard deduction you would have claimed in the absence of buying a home. So you really netted only $6,650 in additional write-offs vs. the $14,500 you might have expected.
Now, if you were already itemizing before you bought or were very close to doing so, your additional deductions from mortgage interest and property taxes will reduce your taxable income dollar for dollar (or nearly so). The point is: Be sure to consider the standard-deduction factor when calculating your anticipated tax savings. That way, you won't be shocked by an unforeseen tax bill next April.
The High-Income Phaseout Factor
If you're a high earner, you're less likely to be affected by the standard-deduction factor. Why? Because you probably have enough itemized deductions (from state and local taxes and charitable contributions) to exceed the standard-deduction amount even without any write-offs for home-mortgage interest and real-estate property taxes. Instead, you may have to worry about the dreaded deduction-phaseout rule that afflicts high-income types.
Once your 2006 adjusted gross income (AGI) exceeds $150,500 (regardless of whether you file joint or single taxes), the phaseout rule reduces your itemized deductions by 2% of the excess. For instance, say your AGI is $300,000. Your otherwise allowable itemized deductions are reduced by $2,990 [($300,000 - $150,500) x .02]. If your AGI is $500,000, your otherwise allowable itemized deductions are reduced by $6,990 [($500,000 - $150,500) x .02]. You get the idea. Not all itemized deductions are affected by this nasty rule, but mortgage interest and real-estate property taxes are. The law provides that taxpayers can't lose more than 53.33% of their deductions under this rule, but that's small comfort to its victims. In fact, itemized deductions for some high earners are curtailed to the extent they wind up back in the standard-deduction mode. When that happens, they don't receive any actual tax benefit from their mortgage interest and property-tax expenses.
Bottom line: If you expect your AGI to exceed $150,500, you'll need to whip out the calculator to figure your actual home-ownership tax savings. (For 2007, the $150,500 amount will be adjusted for inflation.)
The Home-Equity-Loan Factor
Once you're ensconced in your new home, you may decide to take out a home-equity loan. As mentioned above, you can generally claim an itemized deduction for interest on up to $100,000 worth of home-equity debt. The key word here is generally. The fact is, you can't deduct interest to the extent the home-equity-loan principal plus your first mortgage principal exceeds the value of your home. For example, say your first mortgage is $200,000 and your home-equity loan is $75,000. If your home is worth $250,000, you can deduct interest only on $50,000 worth of home-equity-loan principal. Interest on the remaining $25,000 falls into the nondeductible personal-interest category.
A more likely cause for concern is another rule that disallows any alternative minimum tax, or AMT, deduction for home-equity-loan interest unless the loan proceeds were used to improve your property. For example, say you take out a $50,000 home-equity loan and use the money to pay off a car loan and some credit-card balances. For regular tax purposes, that's fine. You can deduct the home-equity-loan interest on Schedule A, along with the interest on your first mortgage. However, if you're in the AMT mode, you can't deduct any of the home-equity-loan interest in calculating your AMT bill.
On the other hand, if you spend your $50,000 home-equity-loan proceeds on a new pool and covered patio, you're good to go for both regular tax and AMT purposes. And one more thing: The high-income deduction-phaseout rule explained earlier can also whittle down your otherwise allowable home-equity-loan interest deduction.
Home Sweet Home
Now you know all the home-ownership tax angles your realtor was afraid to reveal. Still, buying a home usually works out to be at least a decent proposition taxwise. And it will be much better than decent if you eventually sell for a big tax-free gain down the road. If you're married, you can potentially rake in a federal income-tax free profit of up to $500,000, or $250,000 if you're unhitched. Now that's a sweet deal!
Monday, February 4, 2008
2008 Taxpayer Traps
NEW YORK (CNNMoney.com) -- Delayed tax returns and late tax code changes are among the most serious problems facing taxpayers today, according to taxpayer advocate Nina Olson in an annual report to Congress Wednesday.
The National Taxpayer Advocate is appointed by the Treasury Secretary and is charged with representing taxpayer interests before the IRS and Congress.
Among 29 of the most serious taxpayer problems outlined in the report, here are five that Olson detailed:
Missed deductions
Late-year tax law changes, and delays in processing those changes, mean some payers could miss out on tax deductions.
The IRS finalizes its Form 1040 and form 1040A in November. If law changes are made later in the year, taxpayers might not receive updated forms and could file inaccurate returns, Olson said. Taxpayers using tax preparation software face the same problem.
While middle-class taxpayers welcome last month's approved alternative minimum tax patch, which shields them from an old tax law for the wealthy not adjusted for inflation, the late tax law change could affect taxpayers claiming the Child and Dependent Care Credit or other credits, Olson said. This also means tax refund delays for millions.
Refund delays
About 80 percent of taxpayers receive a refund when they file their returns, Olson said, citing the IRS, and for low-income families, refunds are particularly important.
Taxpayers who take the Earned Income Tax Credit, for example, could be significantly impacted by refund delays.
"For some taxpayers, a delay of two to four weeks in receiving the refund could mean eviction, inability to pay the high heating bills that arise during winter, or defaulting on credit card bills from the holiday season," Olson wrote in her report to Congress.
Among families receiving EITC benefits for the 2005 tax year, the average refund amount was $3,093.46, or about 20 percent of the average adjusted gross income, $15,484.52, of those taking the credit, Olson noted.
Refund anticipation loans
Refund anticipation loans sold by tax preparers are "disproportionately targeted toward low-income taxpayers and may exploit those taxpayers' trust in their preparers as well as their lack of financial sophistication," according to Olson.
In addition, some tax preparers have a financial incentive to inappropriately inflate refund amounts, and taxpayers might not completely understand that the refund anticipation loan is separate from filing a tax return, she wrote.
The IRS says it is proposing steps to restrict these practices among tax preparers.
Identity theft
Too often, victims of identity theft receive more scrutiny from the IRS than the perpetrators of identity theft, Olson wrote, noting that identity theft could lead to the delay or denial of refunds, the assessment of tax debts reflecting a fraudulent filer's return, and victims being required to prove their identity to the IRS every year.
If a thief uses another's social security number to report false wages, the IRS system doesn't interpret the duplicate filing as identity theft situation, she said. Instead, the innocent taxpayer's refund is reduced, frozen or the system creates a balance due, according to the advocate's report.
If there is a balance due as a result of two returns filed under the same social security number, the IRS will begin collection actions against the innocent taxpayer, her report notes.
While it has made some improvements, "The IRS has not done enough to improve identity theft procedures for victims of identity theft or to secure its filing system from fraudulent filers," Olson said.
Taxpayer assistance troubles
Shortcomings at IRS-sponsored taxpayer assistance centers are making it difficult for taxpayers requiring face-to-face assistance to get help with their tax returns, the report said.
Taxpayers seeking assistance face inconvenient locations, lack of services, payment problems, and questions deemed by the center to be "out-of-scope," or too complex for IRS employees or volunteers to answer, according to Olson.
While the IRS now acknowledges that there will always taxpayers that require face-to-face assistance in order to comply with tax laws, "the next step is to ensure that Taxpayer Assistance Centers are adequately staffed to meet the needs of that population and adequately trained to answer the questions most likely to be asked by that population," Olson wrote.
Additionally, Olson said a taxpayer bill of rights, outlining what taxpayers have a right to expect from their government's tax system and what the government has a right to expect from its taxpayers, will benefit both taxpayers and tax administration.
The National Taxpayer Advocate is appointed by the Treasury Secretary and is charged with representing taxpayer interests before the IRS and Congress.
Among 29 of the most serious taxpayer problems outlined in the report, here are five that Olson detailed:
Missed deductions
Late-year tax law changes, and delays in processing those changes, mean some payers could miss out on tax deductions.
The IRS finalizes its Form 1040 and form 1040A in November. If law changes are made later in the year, taxpayers might not receive updated forms and could file inaccurate returns, Olson said. Taxpayers using tax preparation software face the same problem.
While middle-class taxpayers welcome last month's approved alternative minimum tax patch, which shields them from an old tax law for the wealthy not adjusted for inflation, the late tax law change could affect taxpayers claiming the Child and Dependent Care Credit or other credits, Olson said. This also means tax refund delays for millions.
Refund delays
About 80 percent of taxpayers receive a refund when they file their returns, Olson said, citing the IRS, and for low-income families, refunds are particularly important.
Taxpayers who take the Earned Income Tax Credit, for example, could be significantly impacted by refund delays.
"For some taxpayers, a delay of two to four weeks in receiving the refund could mean eviction, inability to pay the high heating bills that arise during winter, or defaulting on credit card bills from the holiday season," Olson wrote in her report to Congress.
Among families receiving EITC benefits for the 2005 tax year, the average refund amount was $3,093.46, or about 20 percent of the average adjusted gross income, $15,484.52, of those taking the credit, Olson noted.
Refund anticipation loans
Refund anticipation loans sold by tax preparers are "disproportionately targeted toward low-income taxpayers and may exploit those taxpayers' trust in their preparers as well as their lack of financial sophistication," according to Olson.
In addition, some tax preparers have a financial incentive to inappropriately inflate refund amounts, and taxpayers might not completely understand that the refund anticipation loan is separate from filing a tax return, she wrote.
The IRS says it is proposing steps to restrict these practices among tax preparers.
Identity theft
Too often, victims of identity theft receive more scrutiny from the IRS than the perpetrators of identity theft, Olson wrote, noting that identity theft could lead to the delay or denial of refunds, the assessment of tax debts reflecting a fraudulent filer's return, and victims being required to prove their identity to the IRS every year.
If a thief uses another's social security number to report false wages, the IRS system doesn't interpret the duplicate filing as identity theft situation, she said. Instead, the innocent taxpayer's refund is reduced, frozen or the system creates a balance due, according to the advocate's report.
If there is a balance due as a result of two returns filed under the same social security number, the IRS will begin collection actions against the innocent taxpayer, her report notes.
While it has made some improvements, "The IRS has not done enough to improve identity theft procedures for victims of identity theft or to secure its filing system from fraudulent filers," Olson said.
Taxpayer assistance troubles
Shortcomings at IRS-sponsored taxpayer assistance centers are making it difficult for taxpayers requiring face-to-face assistance to get help with their tax returns, the report said.
Taxpayers seeking assistance face inconvenient locations, lack of services, payment problems, and questions deemed by the center to be "out-of-scope," or too complex for IRS employees or volunteers to answer, according to Olson.
While the IRS now acknowledges that there will always taxpayers that require face-to-face assistance in order to comply with tax laws, "the next step is to ensure that Taxpayer Assistance Centers are adequately staffed to meet the needs of that population and adequately trained to answer the questions most likely to be asked by that population," Olson wrote.
Additionally, Olson said a taxpayer bill of rights, outlining what taxpayers have a right to expect from their government's tax system and what the government has a right to expect from its taxpayers, will benefit both taxpayers and tax administration.
Friday, February 1, 2008
Your Money - by Sandra Block
If you're in your 50s, it's time to plan how you'll pay for long-term care
Updated 3/2/2007 2:40 PM ET E-mail | Save | Print |
Getting old is such a drag that most of us don't like to think about it. And we sure don't like to think about who will take care of us if we stumble and break a hip while strutting to our favorite Rolling Stones CD. But even if you're a lot younger than Mick Jagger — and many of us are — you should be thinking about how you'll pay for long-term care.
A study released last month by AARP found that most Americans don't have a clue about the cost of long-term care. Even more worrisome, many Americans believe that if they do need long-term care, the government will pay for it.
That's a dangerous misconception, says Elizabeth Clemmer, director of policy research and development for AARP. Medicare typically covers only three months of nursing home care, and only if you spend time in a hospital first.
Medicaid's coverage of long-term care, meanwhile, doesn't kick in until you've exhausted nearly all your savings, Clemmer says. In addition, while Medicaid covers nursing home care for people who qualify, coverage of in-home health services is limited. And it doesn't cover assisted living at all.
Moreover, qualifying for Medicaid is more difficult than ever, says Donna Bashaw, president of the National Academy of Elder Law Attorneys. A provision in the Deficit Reduction Act enacted last year makes it harder for seniors to qualify for Medicaid if they've given away assets in the previous five years.
That provision was designed to prevent wealthy seniors from hiding assets. Elder law attorneys argue, though, that it will also penalize middle-income seniors who provide financial assistance to children or grandchildren and later need nursing home care. Under the new rules, Bashaw says, such seniors may have to wait months before they'll become eligible for Medicaid.
How to plan
Good long-term-care planning could help you avoid ending up in a nursing home, or at least give you more options if you require institutional care. Steps to consider:
•Long-term-care insurance. These policies are still relatively new, but they're becoming more flexible. Along with nursing home care, some policies cover in-home care and the cost of an assisted living facility.
Long-term-care insurance is relatively expensive. The cost varies, depending on your age when you buy the policy and the types of services covered.
The younger you are, the lower your premiums, which is why many experts suggest buying a policy when you're in your 50s.
But before you buy a policy, make sure you can afford to pay the premiums for many years, because it could be a long time before you need long-term care. Many people never need nursing home care. And even those who do often stay only a few months.
If you buy a policy while you're in your 50s or 60s and still working, Bashaw says, you need to think about whether you can afford the premiums once you retire.
The U.S. Department of Health and Human Services has created a website with information about long-term care and long-term care insurance. You can find it at www.longtermcare.gov.
•Family care. For all the talk about the breakup of the traditional family, most long-term care in this country is provided by family members. But if you're relying on relatives to care for you, there are some key issues to consider. Do children or other family members live nearby? Will you pay them?
Likewise, if your goal is to live in your house forever, with help from family, make sure your home will be accessible. Will you be able to navigate the staircase to the second floor when your joints start to stiffen? Are your doorways wide enough for a wheelchair?
Updated 3/2/2007 2:40 PM ET E-mail | Save | Print |
Getting old is such a drag that most of us don't like to think about it. And we sure don't like to think about who will take care of us if we stumble and break a hip while strutting to our favorite Rolling Stones CD. But even if you're a lot younger than Mick Jagger — and many of us are — you should be thinking about how you'll pay for long-term care.
A study released last month by AARP found that most Americans don't have a clue about the cost of long-term care. Even more worrisome, many Americans believe that if they do need long-term care, the government will pay for it.
That's a dangerous misconception, says Elizabeth Clemmer, director of policy research and development for AARP. Medicare typically covers only three months of nursing home care, and only if you spend time in a hospital first.
Medicaid's coverage of long-term care, meanwhile, doesn't kick in until you've exhausted nearly all your savings, Clemmer says. In addition, while Medicaid covers nursing home care for people who qualify, coverage of in-home health services is limited. And it doesn't cover assisted living at all.
Moreover, qualifying for Medicaid is more difficult than ever, says Donna Bashaw, president of the National Academy of Elder Law Attorneys. A provision in the Deficit Reduction Act enacted last year makes it harder for seniors to qualify for Medicaid if they've given away assets in the previous five years.
That provision was designed to prevent wealthy seniors from hiding assets. Elder law attorneys argue, though, that it will also penalize middle-income seniors who provide financial assistance to children or grandchildren and later need nursing home care. Under the new rules, Bashaw says, such seniors may have to wait months before they'll become eligible for Medicaid.
How to plan
Good long-term-care planning could help you avoid ending up in a nursing home, or at least give you more options if you require institutional care. Steps to consider:
•Long-term-care insurance. These policies are still relatively new, but they're becoming more flexible. Along with nursing home care, some policies cover in-home care and the cost of an assisted living facility.
Long-term-care insurance is relatively expensive. The cost varies, depending on your age when you buy the policy and the types of services covered.
The younger you are, the lower your premiums, which is why many experts suggest buying a policy when you're in your 50s.
But before you buy a policy, make sure you can afford to pay the premiums for many years, because it could be a long time before you need long-term care. Many people never need nursing home care. And even those who do often stay only a few months.
If you buy a policy while you're in your 50s or 60s and still working, Bashaw says, you need to think about whether you can afford the premiums once you retire.
The U.S. Department of Health and Human Services has created a website with information about long-term care and long-term care insurance. You can find it at www.longtermcare.gov.
•Family care. For all the talk about the breakup of the traditional family, most long-term care in this country is provided by family members. But if you're relying on relatives to care for you, there are some key issues to consider. Do children or other family members live nearby? Will you pay them?
Likewise, if your goal is to live in your house forever, with help from family, make sure your home will be accessible. Will you be able to navigate the staircase to the second floor when your joints start to stiffen? Are your doorways wide enough for a wheelchair?
Wednesday, January 30, 2008
Good Money Decisions
Seven best decisions you can make about money
By Al Jacobs
On the Money Trail
More from this author
When this title was first suggested to me, I instinctively blurted out, “I can think of only one best decision… acquire as much of it is you can!” I’ve since reconsidered; and indeed, there are others.
1. Don’t spend what you don’t have. First and foremost, regularly spend less than you make. Failing to do so is usually a self-deceptive blunder, such as refusing to consider time deadlines. Consider a local mattress dealer that advertises on radio and TV. His madcap skits offering “No deposit, no interest and no payments until… whenever,” are hilarious. However, I shudder at the thought that some people actually purchase an unaffordable product, gambling that in a year or so the full purchase price can be paid to avoid scheduled fees and retroactive interest. It’s a recipe for disaster. It is far better to operate on the age-old principle cash on the barrelhead.
2. You’ll find your financial helping hand at the end of your arm. A half century ago the average American anticipated retirement through an employee pension fund, supplemented by Social Security. But the times have since changed. Many employers, for sheer survival, are under-funding their pension programs and ridding themselves of employees. And with Social Security rapidly evolving into a welfare system, one can count on little outside assistance. The significance of this is clear: Fund your own retirement through regular savings and sound investments. Fashion your life so that part of your income is not consumed, but available for the future. You must do this yourself; don’t expect help elsewhere.
3. Arrange to make your money grow. The adage that time is money is accurate; it depicts the earning power of money invested astutely. Let me suggest a method. Open a self-directed brokerage IRA account — preferably a Roth, if you’re eligible — in which you accumulate certificates of deposit, treasury notes and high-grade corporate bonds. Begin at an early age and pursue this program systematically throughout your working years. An annual contribution of $4,000 invested at 7.5 percent, compounded semiannually over the 40-year period from age 25 to 65, results in more than a million dollars. It’s the compound interest that brings this about, a phenomenon as close to magic as you’ll ever encounter.
4. Don’t be taken advantage of. There is no limit to the ways your money can be misspent or the persons who will take it from you. Don’t let this happen. Delete spam e-mails without opening them. Recognize that all advertisements qualify for the admonition: Ninety-five percent of everything is nonsense. Purchase nothing from uninvited salesmen. Ignore random solicitations for charitable contributions.
5. Plan for the changes that will surely come. Life is a constantly evolving process, with significance at each stage. In your twenties it’s acceptable to live on a shoestring while dreaming and scheming for the future. By your thirties, as family or professional obligations take precedence, closely control your spending and savings habits. During your forties, assiduously concentrate on asset accumulation. I recommend that by age fifty you be able to subsist on passive investment income if necessary. By your sixtieth birthday, you qualify as wealthy, meaning that you can live in a style you choose with no employment required. Remember, things will work out this way only by your early decision to make it happen
6. Don’t expect money to make you happy. You’ve heard the old saying, “Money isn’t everything.” That’s true. Like it or not, wealth brings with it certain demands and responsibilities, and if you ignore them you’ll regret it. As you become wealthy - recognizably wealthy - certain aspects of your life change, and not always for the better. Although the problems of meeting the mortgage and financing the children’s education may no longer exist, other problems move in to take their place. Your relationships with friends and relatives begin to change as you are viewed as something apart. It seems that admiration and envy are opposite sides of the same coin, and as your perceived fortune grows, you will be the recipient of both emotions. Merely possessing money doesn’t ensure happiness: Only its prudent use results in satisfaction. As Ben Franklin said, “The wise use of money is the only advantage in having it.”
7. Give away what you don’t need. In the final analysis, there is a practical limit on personal consumption, beyond which satisfaction is marginal. At some point in our lives there must be more than mere acquisition. There are deserving people in this hostile world and the opportunity to share your bounty in a meaningful way is exactly that * an opportunity. There is satisfaction in giving back a portion of your good fortune.
Let me suggest how. Imagine you are an architect with a love for your profession. What better gift might you make than to pass your learning on to young engineering and architectural students, and encourage the talented ones to pursue that career? Establish a private non-profit educational foundation into which you contribute sums of money. These funds become available for scholarships to students chosen by the foundation directors whom you select, perhaps faculty members of a nearby college. The chosen students receive payments as long as they perform satisfactorily, and it’s your task to monitor their performance. Not only do deserving students benefit directly to the extent of nearly 100 percent of your contributions, but your donations qualify as tax deductions. This is a fine way to fund a philanthropic enterprise in which the value to the actual recipients can be seen and appreciated. What finer way might you spend money?
By Al Jacobs
On the Money Trail
More from this author
When this title was first suggested to me, I instinctively blurted out, “I can think of only one best decision… acquire as much of it is you can!” I’ve since reconsidered; and indeed, there are others.
1. Don’t spend what you don’t have. First and foremost, regularly spend less than you make. Failing to do so is usually a self-deceptive blunder, such as refusing to consider time deadlines. Consider a local mattress dealer that advertises on radio and TV. His madcap skits offering “No deposit, no interest and no payments until… whenever,” are hilarious. However, I shudder at the thought that some people actually purchase an unaffordable product, gambling that in a year or so the full purchase price can be paid to avoid scheduled fees and retroactive interest. It’s a recipe for disaster. It is far better to operate on the age-old principle cash on the barrelhead.
2. You’ll find your financial helping hand at the end of your arm. A half century ago the average American anticipated retirement through an employee pension fund, supplemented by Social Security. But the times have since changed. Many employers, for sheer survival, are under-funding their pension programs and ridding themselves of employees. And with Social Security rapidly evolving into a welfare system, one can count on little outside assistance. The significance of this is clear: Fund your own retirement through regular savings and sound investments. Fashion your life so that part of your income is not consumed, but available for the future. You must do this yourself; don’t expect help elsewhere.
3. Arrange to make your money grow. The adage that time is money is accurate; it depicts the earning power of money invested astutely. Let me suggest a method. Open a self-directed brokerage IRA account — preferably a Roth, if you’re eligible — in which you accumulate certificates of deposit, treasury notes and high-grade corporate bonds. Begin at an early age and pursue this program systematically throughout your working years. An annual contribution of $4,000 invested at 7.5 percent, compounded semiannually over the 40-year period from age 25 to 65, results in more than a million dollars. It’s the compound interest that brings this about, a phenomenon as close to magic as you’ll ever encounter.
4. Don’t be taken advantage of. There is no limit to the ways your money can be misspent or the persons who will take it from you. Don’t let this happen. Delete spam e-mails without opening them. Recognize that all advertisements qualify for the admonition: Ninety-five percent of everything is nonsense. Purchase nothing from uninvited salesmen. Ignore random solicitations for charitable contributions.
5. Plan for the changes that will surely come. Life is a constantly evolving process, with significance at each stage. In your twenties it’s acceptable to live on a shoestring while dreaming and scheming for the future. By your thirties, as family or professional obligations take precedence, closely control your spending and savings habits. During your forties, assiduously concentrate on asset accumulation. I recommend that by age fifty you be able to subsist on passive investment income if necessary. By your sixtieth birthday, you qualify as wealthy, meaning that you can live in a style you choose with no employment required. Remember, things will work out this way only by your early decision to make it happen
6. Don’t expect money to make you happy. You’ve heard the old saying, “Money isn’t everything.” That’s true. Like it or not, wealth brings with it certain demands and responsibilities, and if you ignore them you’ll regret it. As you become wealthy - recognizably wealthy - certain aspects of your life change, and not always for the better. Although the problems of meeting the mortgage and financing the children’s education may no longer exist, other problems move in to take their place. Your relationships with friends and relatives begin to change as you are viewed as something apart. It seems that admiration and envy are opposite sides of the same coin, and as your perceived fortune grows, you will be the recipient of both emotions. Merely possessing money doesn’t ensure happiness: Only its prudent use results in satisfaction. As Ben Franklin said, “The wise use of money is the only advantage in having it.”
7. Give away what you don’t need. In the final analysis, there is a practical limit on personal consumption, beyond which satisfaction is marginal. At some point in our lives there must be more than mere acquisition. There are deserving people in this hostile world and the opportunity to share your bounty in a meaningful way is exactly that * an opportunity. There is satisfaction in giving back a portion of your good fortune.
Let me suggest how. Imagine you are an architect with a love for your profession. What better gift might you make than to pass your learning on to young engineering and architectural students, and encourage the talented ones to pursue that career? Establish a private non-profit educational foundation into which you contribute sums of money. These funds become available for scholarships to students chosen by the foundation directors whom you select, perhaps faculty members of a nearby college. The chosen students receive payments as long as they perform satisfactorily, and it’s your task to monitor their performance. Not only do deserving students benefit directly to the extent of nearly 100 percent of your contributions, but your donations qualify as tax deductions. This is a fine way to fund a philanthropic enterprise in which the value to the actual recipients can be seen and appreciated. What finer way might you spend money?
Tuesday, January 29, 2008
Domestic Violence Help
Brought to you by The Allstate Foundation.
Click To EmpowerShow your support for survivors of Domestic ViolenceFor every click received, $1 will be donated by The Allstate Foundation to the Education Job Training and Assistance Fund with a total donation of $300,000.
Click to Empower Now. 28120 clicks With the New Year comes new beginnings, but for many in domestic violence relationships it is a continuous struggle to survive. You have a chance to make a difference.
For many domestic violence survivors, economic empowerment is critical to their long term self-sufficiency. The Education and Job Training Assistance Fund enables survivors to pursue long-term financial security by providing much needed financial assistance for education, training and job-related expenses such as books and supplies for school, tuition and registration fees.
http://www.clicktoempower.com/
Click To EmpowerShow your support for survivors of Domestic ViolenceFor every click received, $1 will be donated by The Allstate Foundation to the Education Job Training and Assistance Fund with a total donation of $300,000.
Click to Empower Now. 28120 clicks With the New Year comes new beginnings, but for many in domestic violence relationships it is a continuous struggle to survive. You have a chance to make a difference.
For many domestic violence survivors, economic empowerment is critical to their long term self-sufficiency. The Education and Job Training Assistance Fund enables survivors to pursue long-term financial security by providing much needed financial assistance for education, training and job-related expenses such as books and supplies for school, tuition and registration fees.
http://www.clicktoempower.com/
Monday, January 28, 2008
Get Paid to Travel
King of the road: How to be an RV courierby Ken and Daria Dolan Jan 10th 2008 @ 8:00AM
Filed under: Extracurriculars, The Dolans, Health, Travel
Ken and Daria Dolan are widely known as America's First Family of Personal Finance.
Wow...
Daria and I were shocked at the number of you who emailed us in response to our Four creative ways to travel for free post . Seems lots of you are intrigued by the idea of traveling the country for free as an RV courier.
Then again, what's not to like about getting paid to travel?!
So today let's talk about whether being an RV courier is right for you and how you can get started. We called America's number one expert on the subject to get the full story and we've got some great tips for you.
Let's start with 3 things you need to know about being an RV courier...
1.) This may be the best job no one's ever heard about! Who DOESN'T want a job with good pay, flexible hours, steady work and a chance to travel the country for free? Even in this tough economy, there are about 5,000 new drivers needed each month.
2.) Becoming an RV courier is easier than you think. If you are over 18, have a valid driver's license with a good driving record, and like to drive, you're in! Unless you are going to drive something about as big as a Greyhound bus, you don't even need a special commercial license.
3.) It's a job for the ages. Are you a student? RV couriering is a great summer job. Have a regular 9-5 job? Make some extra money on the weekends. Retired? Grab your sweetie, see the country and put a little extra money in your pocket.
Now for some nitty-gritty. The company you work for will pay for insurance, fuel and (if it's a one-way drop off) your trip back home. They'll also pay you, of course! Most companies pay by the mile, and you can use 35 cents/mile as a good average.
Unlike truck drivers, this is a low stress endeavor. You won't be pressured by the company to deliver your vehicle on a crazy schedule. They want safe drivers who will come back again and again.
Still reading? If so, sounds like this might be serious. That means our expert Craig Chilton is your next stop. Craig started as an RV courier 30 years ago on his summer break from teaching and has stayed with it ever since. He literally wrote THE book on the subject "How to Get Paid $50,000 a Year to Travel" and has developed a driver placement network that connects wannabe drivers with companies that need them.
Visit www.roadrat.com to learn more and to take his job aptitude test to find out whether becoming an RV courier is right for you!
If you do decide to hit the road, send us a postcard or email us your pictures to aolquestions@dolans.com. And be sure to email us with your experiences so we can share them here!
Ken and Daria Dolan have hosted their own national radio program for 22 years, anchored their own television shows on CNN, authored six books on money matters, served as money contributors on CBS This Morning and have now launched a comprehensive web site and free e-letter at Dolans.com.
Filed under: Extracurriculars, The Dolans, Health, Travel
Ken and Daria Dolan are widely known as America's First Family of Personal Finance.
Wow...
Daria and I were shocked at the number of you who emailed us in response to our Four creative ways to travel for free post . Seems lots of you are intrigued by the idea of traveling the country for free as an RV courier.
Then again, what's not to like about getting paid to travel?!
So today let's talk about whether being an RV courier is right for you and how you can get started. We called America's number one expert on the subject to get the full story and we've got some great tips for you.
Let's start with 3 things you need to know about being an RV courier...
1.) This may be the best job no one's ever heard about! Who DOESN'T want a job with good pay, flexible hours, steady work and a chance to travel the country for free? Even in this tough economy, there are about 5,000 new drivers needed each month.
2.) Becoming an RV courier is easier than you think. If you are over 18, have a valid driver's license with a good driving record, and like to drive, you're in! Unless you are going to drive something about as big as a Greyhound bus, you don't even need a special commercial license.
3.) It's a job for the ages. Are you a student? RV couriering is a great summer job. Have a regular 9-5 job? Make some extra money on the weekends. Retired? Grab your sweetie, see the country and put a little extra money in your pocket.
Now for some nitty-gritty. The company you work for will pay for insurance, fuel and (if it's a one-way drop off) your trip back home. They'll also pay you, of course! Most companies pay by the mile, and you can use 35 cents/mile as a good average.
Unlike truck drivers, this is a low stress endeavor. You won't be pressured by the company to deliver your vehicle on a crazy schedule. They want safe drivers who will come back again and again.
Still reading? If so, sounds like this might be serious. That means our expert Craig Chilton is your next stop. Craig started as an RV courier 30 years ago on his summer break from teaching and has stayed with it ever since. He literally wrote THE book on the subject "How to Get Paid $50,000 a Year to Travel" and has developed a driver placement network that connects wannabe drivers with companies that need them.
Visit www.roadrat.com to learn more and to take his job aptitude test to find out whether becoming an RV courier is right for you!
If you do decide to hit the road, send us a postcard or email us your pictures to aolquestions@dolans.com. And be sure to email us with your experiences so we can share them here!
Ken and Daria Dolan have hosted their own national radio program for 22 years, anchored their own television shows on CNN, authored six books on money matters, served as money contributors on CBS This Morning and have now launched a comprehensive web site and free e-letter at Dolans.com.
Thursday, January 24, 2008
Wednesday, January 23, 2008
Update & Correction
Yesterday's blog omitted a very important link. My apologies to the author for not including it in the post.
Written by David B. Bohl of Slow Down Fast.
Thanks David for understanding that I am new to the whole concept of blogging.
Written by David B. Bohl of Slow Down Fast.
Thanks David for understanding that I am new to the whole concept of blogging.
Tuesday, January 22, 2008
2008 Resolutions
Are Your 2008 Resolutions Alive?
Posted on 1/21/2008 |Join the Discussion (6 comments) A few weeks ago I wrote about the importance of planning and keeping your New Year’s resolutions. For many of us, New Year’s resolutions give us a chance to set personal and career goals that we want to achieve throughout the year. Setting goals, as we know, helps us achieve success because they are measurable and finite – you can look back and say “Yes, I did it!” or “No, I have a ways to go yet!”
So now that we are a few weeks into 2008, it’s time for a health check. Are you doing everything you can to keep your resolutions – your goals – alive and in focus? If you find yourself slipping already, don’t throw in the towel just yet. You wrote your goals down, and that is half the battle. Now you have to put actions to your words and make them happen. Here are a few ways I’ve found to keep New Year’s resolutions alive throughout the year:
Set up milestones, or mini-resolutions. A milestone is a way of tracking progress. Let’s say your resolution was to advance in your career by either getting a promotion or a substantial raise in the year ahead. Set up milestones such as “Attend workshop on career development” or “Complete Project XYZ by April 1st”. Then as you complete each milestone, mark it off and realize you are now that much closer to making your goal a reality!
Keep note cards, Post-Its and other little notes where you can see them – in your briefcase, on the refrigerator, or on your monitor at work with your goals written on them. Use them as your daily reaffirmation of the goal. If your goal is to “Lose 30 lbs by 2009,” having these notes serves as a reminder each morning that perhaps eating some toast and a banana is better than having eggs, bacon and hash browns.
Join a support group – either in your local community or virtually. There is no doubt about it: we all follow through on our goals better if we have others supporting us. Thanks to the internet, there are many virtual support groups you can join where likeminded individuals gather to share ideas and encourage each other on. Likewise, in your local community there might be support groups for career development, small business owners, weight loss and the like that meet every month. Not only will you gain motivation to make your resolutions a success, but you will also expand your personal network by getting to know people who might be in a similar industry or group.
Realize your mistakes and learn from them. If you find you are straying from your goals, examine what causes you to stray and jump right back on them. Learning from our mistakes is one of the best ways we grow as a person. You’ll find that once you’ve identified the roadblocks to your success you can much more easily avoid them the second time around.
Four simple tips, but for those who are serious about achieving their goals they can be significant words of wisdom to help them change their life. Are you ready to change your life in 2008? Are you ready to keep your resolution and achieve your life and career goals? It’s not too late – the only thing missing is your determination!
Written by David B. Bohl of Slow Down Fast.
Posted on 1/21/2008 |Join the Discussion (6 comments) A few weeks ago I wrote about the importance of planning and keeping your New Year’s resolutions. For many of us, New Year’s resolutions give us a chance to set personal and career goals that we want to achieve throughout the year. Setting goals, as we know, helps us achieve success because they are measurable and finite – you can look back and say “Yes, I did it!” or “No, I have a ways to go yet!”
So now that we are a few weeks into 2008, it’s time for a health check. Are you doing everything you can to keep your resolutions – your goals – alive and in focus? If you find yourself slipping already, don’t throw in the towel just yet. You wrote your goals down, and that is half the battle. Now you have to put actions to your words and make them happen. Here are a few ways I’ve found to keep New Year’s resolutions alive throughout the year:
Set up milestones, or mini-resolutions. A milestone is a way of tracking progress. Let’s say your resolution was to advance in your career by either getting a promotion or a substantial raise in the year ahead. Set up milestones such as “Attend workshop on career development” or “Complete Project XYZ by April 1st”. Then as you complete each milestone, mark it off and realize you are now that much closer to making your goal a reality!
Keep note cards, Post-Its and other little notes where you can see them – in your briefcase, on the refrigerator, or on your monitor at work with your goals written on them. Use them as your daily reaffirmation of the goal. If your goal is to “Lose 30 lbs by 2009,” having these notes serves as a reminder each morning that perhaps eating some toast and a banana is better than having eggs, bacon and hash browns.
Join a support group – either in your local community or virtually. There is no doubt about it: we all follow through on our goals better if we have others supporting us. Thanks to the internet, there are many virtual support groups you can join where likeminded individuals gather to share ideas and encourage each other on. Likewise, in your local community there might be support groups for career development, small business owners, weight loss and the like that meet every month. Not only will you gain motivation to make your resolutions a success, but you will also expand your personal network by getting to know people who might be in a similar industry or group.
Realize your mistakes and learn from them. If you find you are straying from your goals, examine what causes you to stray and jump right back on them. Learning from our mistakes is one of the best ways we grow as a person. You’ll find that once you’ve identified the roadblocks to your success you can much more easily avoid them the second time around.
Four simple tips, but for those who are serious about achieving their goals they can be significant words of wisdom to help them change their life. Are you ready to change your life in 2008? Are you ready to keep your resolution and achieve your life and career goals? It’s not too late – the only thing missing is your determination!
Written by David B. Bohl of Slow Down Fast.
Monday, January 21, 2008
Insurance Bargains
Top 10 Least Expensive to Insure Cars of 2007
By Warren Clarke
Email
If you own or lease a vehicle, the related insurance expenses can take a huge chomp out of your finances. However, there are decisions you can make that could ease your burden. In many cases, the factors that impact your insurance rate — which have to do with where you live, your accident history, your yearly mileage and so on — are difficult to control.
If you haven't yet decided on that new car, though, know that there's one crucial factor affecting your insurance expenses that you can control: the kind of car you drive. Your insurance rate will be heavily impacted by the make and model of your vehicle. Without a doubt, then, you're going to want to go into your next purchase armed with all the relevant facts.
Here are the 10 cars most likely to command the lowest insurance premiums based on five-year projections of the Edmunds.com True Cost to OwnSM (TCO) pricing system. Each model's ranking reflects that of the trim level with the lowest projected insurance expense.
2007 Pontiac Vibe
2007 Chrysler PT Cruiser
2007 Saturn Aura
2007 Subaru Outback
2007 Chrysler Pacifica
2007 Subaru Legacy
2007 Toyota Matrix
2007 Buick Lucerne (tie)
2007 Ford Focus (tie)
2007 Saturn Ion
By Warren Clarke
If you own or lease a vehicle, the related insurance expenses can take a huge chomp out of your finances. However, there are decisions you can make that could ease your burden. In many cases, the factors that impact your insurance rate — which have to do with where you live, your accident history, your yearly mileage and so on — are difficult to control.
If you haven't yet decided on that new car, though, know that there's one crucial factor affecting your insurance expenses that you can control: the kind of car you drive. Your insurance rate will be heavily impacted by the make and model of your vehicle. Without a doubt, then, you're going to want to go into your next purchase armed with all the relevant facts.
Here are the 10 cars most likely to command the lowest insurance premiums based on five-year projections of the Edmunds.com True Cost to OwnSM (TCO) pricing system. Each model's ranking reflects that of the trim level with the lowest projected insurance expense.
2007 Pontiac Vibe
2007 Chrysler PT Cruiser
2007 Saturn Aura
2007 Subaru Outback
2007 Chrysler Pacifica
2007 Subaru Legacy
2007 Toyota Matrix
2007 Buick Lucerne (tie)
2007 Ford Focus (tie)
2007 Saturn Ion
Thursday, January 17, 2008
Successful Life
20 Qualities for a Successful Life
Posted on 1/16/2008 |Join the Discussion (12 comments) How do you define a successful life? Is it by how much money or stuff you have amassed, or is it by the legacy you leave behind? All too often we equate a successful life with material possessions. Yet, there are millions of people out there who lead successful, fulfilled lives who may be of modest means. They may not be rich in the financial sense, but they are rich in life and values.
So what are the things we should strive for to make our lives successful and have a positive impact on those around us? Here is a list of traits that I think defines what true success in life is all about. Does your list differ?
Sincerity. Be sincere in your actions. Don’t try to deceive or impress others. Be yourself, and do what you feel is right based on your values and beliefs. You will be surprised at how people accept you when you stop trying to be someone you aren’t.
Unfeigned. Be genuine in what you do; your actions speak louder than your words. Don’t falsify or embellish events that may have happened. Don’t say one thing and do the other.
Wholehearted. Be enthusiastic about what you do. Show it. Be committed to life and everything that you set out to accomplish in life. Devote yourself to your family, friends, and community and commit yourself to being the best father, husband, wife, mother, friend, and neighbor you can be.
Honest. Be honest in your dealings with yourself and with others. When others interact with you, let them see someone who is reputable, respectable and genuine. Do what you say you will do and never use fraud or deception to get ahead in life. Let ethics, morals, and honor be your compass.
Heartfelt. When you do something for someone, or they do something for you, let your thanks and emotion be openly and outwardly expressed towards them.
Hearty. Be someone who displays an honest, warm, and exuberant personality to those around them. Let your feelings show and let them be genuine when they do.
Humility. Don’t lead a life thinking you are better than others or are superior to those around you. Modesty and humbleness will leave a far more ever lasting impact on people than trying to show off.
Personal integrity. Always follow your heartfelt values, and never let a situation or anyone steer you away from doing what you know is right. Be someone that people can look up to and respect and not someone who trades his or her moral values for material gains in life.
Incorruptibility. Let it be known that you stand firm for what you believe in and that your morals, values and actions are not for sale. Don’t let outside forces corrupt the person you are.
Sound. Show good judgment and sense in life. Don’t let prejudices or emotions cloud your judgment.
Whole. Be focused on what you want to achieve in life. Give everyone you interact with your complete and undivided attention.
Courtesy. Practice good manners even though others around you may not.
Civility. Graciousness and respect go a long way in life. What is more, they are viral – when people see you doing it they are more apt to practice civility themselves. Be kind to others and extend courtesy towards them. Don’t interrupt people when they speak and don’t dominate the conversation.
Wisdom. Gain from the wisdom that is inside you. Understand the inner qualities of people and learn how to understand situations that might be different than we are used to.
Charity. Practice kind, gentle, and compassionate treatment of others – especially those who may be undeserving. Learn to extend a hand to help others, even though they themselves may not have helped you.
Empathy. Be aware that each person is different and may have different values and beliefs than those that you hold. Be understanding of the feelings and thoughts of others without having to be told or reminded of them.
Sympathy. Share your feelings with others and understand the emotional situations that people go through. Put yourself in their shoes.
Compassion. When someone is in distress, reach out with a genuine interest in helping alleviate their suffering.
Altruism. Think of others without thinking of yourself. Do good things for people without expecting something in return for yourself.
Magnanimous. Be generous in life. Give of your time, money and wisdom. Share with others so they can see the true joy and adventures of life themselves.
There are the qualities I think helps lead a person to life a successful life. Clearly everyone's views will differ, as they should. What are some qualities that you think define success in life?
Written by David B. Bohl of Slow Down Fast.
Posted on 1/16/2008 |Join the Discussion (12 comments) How do you define a successful life? Is it by how much money or stuff you have amassed, or is it by the legacy you leave behind? All too often we equate a successful life with material possessions. Yet, there are millions of people out there who lead successful, fulfilled lives who may be of modest means. They may not be rich in the financial sense, but they are rich in life and values.
So what are the things we should strive for to make our lives successful and have a positive impact on those around us? Here is a list of traits that I think defines what true success in life is all about. Does your list differ?
Sincerity. Be sincere in your actions. Don’t try to deceive or impress others. Be yourself, and do what you feel is right based on your values and beliefs. You will be surprised at how people accept you when you stop trying to be someone you aren’t.
Unfeigned. Be genuine in what you do; your actions speak louder than your words. Don’t falsify or embellish events that may have happened. Don’t say one thing and do the other.
Wholehearted. Be enthusiastic about what you do. Show it. Be committed to life and everything that you set out to accomplish in life. Devote yourself to your family, friends, and community and commit yourself to being the best father, husband, wife, mother, friend, and neighbor you can be.
Honest. Be honest in your dealings with yourself and with others. When others interact with you, let them see someone who is reputable, respectable and genuine. Do what you say you will do and never use fraud or deception to get ahead in life. Let ethics, morals, and honor be your compass.
Heartfelt. When you do something for someone, or they do something for you, let your thanks and emotion be openly and outwardly expressed towards them.
Hearty. Be someone who displays an honest, warm, and exuberant personality to those around them. Let your feelings show and let them be genuine when they do.
Humility. Don’t lead a life thinking you are better than others or are superior to those around you. Modesty and humbleness will leave a far more ever lasting impact on people than trying to show off.
Personal integrity. Always follow your heartfelt values, and never let a situation or anyone steer you away from doing what you know is right. Be someone that people can look up to and respect and not someone who trades his or her moral values for material gains in life.
Incorruptibility. Let it be known that you stand firm for what you believe in and that your morals, values and actions are not for sale. Don’t let outside forces corrupt the person you are.
Sound. Show good judgment and sense in life. Don’t let prejudices or emotions cloud your judgment.
Whole. Be focused on what you want to achieve in life. Give everyone you interact with your complete and undivided attention.
Courtesy. Practice good manners even though others around you may not.
Civility. Graciousness and respect go a long way in life. What is more, they are viral – when people see you doing it they are more apt to practice civility themselves. Be kind to others and extend courtesy towards them. Don’t interrupt people when they speak and don’t dominate the conversation.
Wisdom. Gain from the wisdom that is inside you. Understand the inner qualities of people and learn how to understand situations that might be different than we are used to.
Charity. Practice kind, gentle, and compassionate treatment of others – especially those who may be undeserving. Learn to extend a hand to help others, even though they themselves may not have helped you.
Empathy. Be aware that each person is different and may have different values and beliefs than those that you hold. Be understanding of the feelings and thoughts of others without having to be told or reminded of them.
Sympathy. Share your feelings with others and understand the emotional situations that people go through. Put yourself in their shoes.
Compassion. When someone is in distress, reach out with a genuine interest in helping alleviate their suffering.
Altruism. Think of others without thinking of yourself. Do good things for people without expecting something in return for yourself.
Magnanimous. Be generous in life. Give of your time, money and wisdom. Share with others so they can see the true joy and adventures of life themselves.
There are the qualities I think helps lead a person to life a successful life. Clearly everyone's views will differ, as they should. What are some qualities that you think define success in life?
Written by David B. Bohl of Slow Down Fast.
Wednesday, January 16, 2008
Going to the Dogs!
28 Aug 2007 09:33 AM
Dog Bite Liability
by Anna Glendenning | More from this Blogger
There has been a growing popularity since the mid-1990s, of people choosing to own the more aggressive breeds of dogs. This is a security concern because dog attacks are now the largest single cause of homeowner insurance policy claims. Dogs and their bites have become a major concern for homeowner insurance companies and considering the statistics it's not hard to see why:
The Centers for Disease Control and Prevention, reports that more than 4.7 million people are bitten by dogs every year with an estimated 800,000 injuries requiring medical treatment. More than 50 percent of the bites happen on the owner's property, often to visitors and family members.
During 2006 insurance companies paid out $351.4 million, for dog bite claims. This was up an astounding 10.8 percent from 2005.
The actual number of dog bite claims paid by insurance companies actually fell from around 20,800 in 2002 to only 15,000 in 2005 but the cost of the average dog bite claim sky rocketed from about $16,600 in 2002 to more then $21,200 in 2005.
Just about 4 percent of all homeowner claims are dog bite Liability claims and dog bite claims accounted for nearly 15 percent of liability claims paid under homeowner insurance policies during 2005.
Several states have laws with stiff penalties for owners of dogs that cause serious injuries or deaths.
About one-third of states dog owners are "strictly liable" for their dogs' behavior, and in the other states owners are liable only if they knew or should have known their dogs had a propensity to bite. This is known as the "one free bite" principle.
Insurance companies may send underwriters or inspectors to check a home owner's property. When there is a dog the insurance company may check the environment. The home will be checked for things such as:
Fenced yards
Clean groomed area of the yard (is the doogie-doo picked up?)
Is the animal well cared for, or left out in the yard all day?
After an insurance inspection the insurance company may send a letter to the policyholder asking questions about the dog such as:
Whether the dog is licensed?
Is the dog neutered or spayed, male neutered dogs are much less prone to biting and females are common for breeding.
You may be asked if the dog has been provided an special training
Insurance companies can impose a dog breed exclusion and they can cancel a homeowner insurance policy, for or any breed bans there may be in place.
Some homeowner associations have rules and regulations that disallow some dog breeds
Dog Bite Liability
by Anna Glendenning | More from this Blogger
There has been a growing popularity since the mid-1990s, of people choosing to own the more aggressive breeds of dogs. This is a security concern because dog attacks are now the largest single cause of homeowner insurance policy claims. Dogs and their bites have become a major concern for homeowner insurance companies and considering the statistics it's not hard to see why:
The Centers for Disease Control and Prevention, reports that more than 4.7 million people are bitten by dogs every year with an estimated 800,000 injuries requiring medical treatment. More than 50 percent of the bites happen on the owner's property, often to visitors and family members.
During 2006 insurance companies paid out $351.4 million, for dog bite claims. This was up an astounding 10.8 percent from 2005.
The actual number of dog bite claims paid by insurance companies actually fell from around 20,800 in 2002 to only 15,000 in 2005 but the cost of the average dog bite claim sky rocketed from about $16,600 in 2002 to more then $21,200 in 2005.
Just about 4 percent of all homeowner claims are dog bite Liability claims and dog bite claims accounted for nearly 15 percent of liability claims paid under homeowner insurance policies during 2005.
Several states have laws with stiff penalties for owners of dogs that cause serious injuries or deaths.
About one-third of states dog owners are "strictly liable" for their dogs' behavior, and in the other states owners are liable only if they knew or should have known their dogs had a propensity to bite. This is known as the "one free bite" principle.
Insurance companies may send underwriters or inspectors to check a home owner's property. When there is a dog the insurance company may check the environment. The home will be checked for things such as:
Fenced yards
Clean groomed area of the yard (is the doogie-doo picked up?)
Is the animal well cared for, or left out in the yard all day?
After an insurance inspection the insurance company may send a letter to the policyholder asking questions about the dog such as:
Whether the dog is licensed?
Is the dog neutered or spayed, male neutered dogs are much less prone to biting and females are common for breeding.
You may be asked if the dog has been provided an special training
Insurance companies can impose a dog breed exclusion and they can cancel a homeowner insurance policy, for or any breed bans there may be in place.
Some homeowner associations have rules and regulations that disallow some dog breeds
Monday, January 14, 2008
Crash Tests
Crash Ratings Don't Accurately Reflect Trucks' Real-World Safety, Study Says
by Hilary Johnson
Tuesday, January 1, 2008
provided by
Crash tests conducted by the government and insurance industry may be a poor indicator of how safe -- or unsafe -- pickup trucks are, an independent study suggests.
The trucks that performed badly in simulated crashes may be safer than their ratings suggest and those that performed well may be more dangerous, according to research conducted by economics professors at Virginia Commonwealth University in Richmond. The study appeared in the journal Accident Analysis and Prevention.
The professors compared crash test data from the National Highway Traffic Safety Administration (NHTSA) and the Insurance Institute for Highway Safety (IIHS) with government data on fatal crashes. They concluded that the tests seem to be an accurate guage of car safety: Cars with higher crash-test ratings show fewer driver fatalities and those with lower ratings show more. But the same does not hold true for trucks.
"Something about trucks makes them different," said David W. Harless, who co-authored the study with George E. Hoffer.
The Study
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The study looked at changes in crash test ratings for all cars and trucks tested at least twice by the NHTSA from 1987 through 2001 and by the IIHS from 1995 through 2001. It compared the ratings with government data on fatal crashes over the same period to determine whether improvements in crash-test ratings translated to fewer driver fatalities.
The study found that higher crash-test ratings often correlated with fewer driver fatalities for cars, but not for trucks. The NHTSA ranks vehicles on a scale of one star (the worst rating) to five stars (the best). The IIHS uses labels that range from "poor" to "good."
"We had trucks with one-star NHTSA ratings being 3 percent safer than those with five-star ratings," Harless said. "With the IIHS, which was a relatively small sample, trucks with a 'poor' rating had 30 percent less risk [of driver fatality in wrecks] than trucks with a 'good' rating."
To reduce the likelihood of variables such as a vehicle's size and weight skewing the results, the study compared changes in crash data only within vehicle lines and not between different types of vehicles. For instance, Ford F-150 pickup trucks were only compared to other Ford F-150 pickup trucks.
The NHTSA would not comment on the Virginia Commonwealth study.
Russ Rader, an IIHS spokesperson, took issue with the findings. Rader said that the IIHS's own research shows a strong correlation between crash-test ratings and fatalities for all kinds of vehicles, including trucks. "It doesn't make sense that there would be a difference" between cars and trucks, he said. "The things you do to a car for crash safety are the same things you do for SUVs and pickups." For example, all vehicles now incorporate crumple zones and reinforced passenger-cabin structures.
Conflicting Views
George E. Hoffer, a co-author of the study, said the body structure of trucks may be one reason why their crash test ratings failed to correlate with driver fatalities.
Unlike cars, pickup trucks have stout steel frames underneath, often called "ladder frames." Hoffer said a ladder frame might act like a "pronged battering ram" in a real-world crash where a truck collides with a lighter, smaller vehicle. This might make a truck more likely to withstand the impact of an actual crash better than it does when striking a stationary barrier such as in some crash tests.
Ford safety spokesman Dan Jarvis disputed the study's findings and methodology. He said the idea that a truck's ladder frame has any discernible impact on crash test ratings is "at best uninformed."
Harless cited the Ford F-150 two-door pickup truck as an example of how improvements in crash test ratings do not result in fewer driver fatalities. For the 1992-1993 model years, the F-150 received an NHTSA rating of three stars, Harless said, but the driver death rate was about one death per 10,000 registered vehicles. For the 1994-1996 model years, the F-150 received a five-star rating, but the driver death rate rose to nearly 1.2 driver deaths per 10,000 vehicles.
Independently of Harless, Rader of the IIHS also used the F-150 to illustrate his opposing view that a noticeable improvement in crash test ratings between the 2001 model and the 2004 model correlates with fewer driver fatalities. According to the IIHS's own analysis, the 2001 Ford F-150 had 118 deaths per million per year between 2002 and 2005 when it was rated as "poor," Rader said. But the 2004 F-150, with an improved crash test rating of "good," had a much lower driver death rate of 58 per million vehicles per year.
This is a good indicator of how evaluating crash-test ratings can be confusing. In this case, the study authors pointed to the NHTSA ratings for the F-150, not the IIHS ratings. The study also looked at the F-150 in different years than those cited by Rader.
When asked about the IIHS findings, Hoffer said that he did not doubt their accuracy, but that the model years that Rader gave were different than those used in his own study.
The results for any one particular vehicle aside, Hoffer said the data for cars and trucks overall is what offers the most telling insight. He said there was no relationship between improvements in crash test ratings and driver death rates for "the entire population" of trucks they evaluated, which include model years 1987-2001.
Drawing Conclusions
The conclusion the professors reached was that NHTSA and IIHS crash test data shouldn't be as important of a consideration for pickup truck buyers as it is for passenger-car buyers, because for cars the correlations between ratings and fatalities are stronger. "The architecture of trucks is so different that it overwhelms any information that the consumer can glean from the crash test," Hoffer said.
Anne Fleming, a spokesperson for the IIHS, said that the institute had no evidence that ladder-frame construction, also called "body on frame" construction, typically used in pickup trucks, has any effect on crashworthiness.
Though Ford's Jarvis also disagreed with the professors' conclusions, he did think the study illustrates something important. "The point is well taken that it's indeed very difficult to correlate [crash-test ratings] and real-world crash events," he said. "But that difficulty arises from several factors, including the complexity of the real-world crash environment, and a variety of non-vehicle factors, like was the occupant wearing a safety belt, or was the vehicle pulling a trailer?"
Charles Territo, director of communications at the Alliance of Automobile Manufacturers, also agreed that directly correlating crash test ratings and fatalities is tough. "We don't know what percentage of accidents involved people not wearing seatbelts, being under the influence, being ejected from their vehicles," he said. "There are so many different factors at play that it's just difficult."
The bottom line, Territo said, is that regardless of any conclusion the VCU study made, crash test ratings are still a valuable resource for consumers, but shouldn't be the only consideration when shopping for a vehicle.
Jim Somborovich is an insurance agent for Allstate Insurance Company and can be reached at: js@allstate.com
by Hilary Johnson
Tuesday, January 1, 2008
provided by
Crash tests conducted by the government and insurance industry may be a poor indicator of how safe -- or unsafe -- pickup trucks are, an independent study suggests.
The trucks that performed badly in simulated crashes may be safer than their ratings suggest and those that performed well may be more dangerous, according to research conducted by economics professors at Virginia Commonwealth University in Richmond. The study appeared in the journal Accident Analysis and Prevention.
The professors compared crash test data from the National Highway Traffic Safety Administration (NHTSA) and the Insurance Institute for Highway Safety (IIHS) with government data on fatal crashes. They concluded that the tests seem to be an accurate guage of car safety: Cars with higher crash-test ratings show fewer driver fatalities and those with lower ratings show more. But the same does not hold true for trucks.
"Something about trucks makes them different," said David W. Harless, who co-authored the study with George E. Hoffer.
The Study
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• Porsche 911: Quick and Breezy
• Bragging Rights of Mercedes-Benz
• Ford Mustang: Modern-Day Muscle-Car
The study looked at changes in crash test ratings for all cars and trucks tested at least twice by the NHTSA from 1987 through 2001 and by the IIHS from 1995 through 2001. It compared the ratings with government data on fatal crashes over the same period to determine whether improvements in crash-test ratings translated to fewer driver fatalities.
The study found that higher crash-test ratings often correlated with fewer driver fatalities for cars, but not for trucks. The NHTSA ranks vehicles on a scale of one star (the worst rating) to five stars (the best). The IIHS uses labels that range from "poor" to "good."
"We had trucks with one-star NHTSA ratings being 3 percent safer than those with five-star ratings," Harless said. "With the IIHS, which was a relatively small sample, trucks with a 'poor' rating had 30 percent less risk [of driver fatality in wrecks] than trucks with a 'good' rating."
To reduce the likelihood of variables such as a vehicle's size and weight skewing the results, the study compared changes in crash data only within vehicle lines and not between different types of vehicles. For instance, Ford F-150 pickup trucks were only compared to other Ford F-150 pickup trucks.
The NHTSA would not comment on the Virginia Commonwealth study.
Russ Rader, an IIHS spokesperson, took issue with the findings. Rader said that the IIHS's own research shows a strong correlation between crash-test ratings and fatalities for all kinds of vehicles, including trucks. "It doesn't make sense that there would be a difference" between cars and trucks, he said. "The things you do to a car for crash safety are the same things you do for SUVs and pickups." For example, all vehicles now incorporate crumple zones and reinforced passenger-cabin structures.
Conflicting Views
George E. Hoffer, a co-author of the study, said the body structure of trucks may be one reason why their crash test ratings failed to correlate with driver fatalities.
Unlike cars, pickup trucks have stout steel frames underneath, often called "ladder frames." Hoffer said a ladder frame might act like a "pronged battering ram" in a real-world crash where a truck collides with a lighter, smaller vehicle. This might make a truck more likely to withstand the impact of an actual crash better than it does when striking a stationary barrier such as in some crash tests.
Ford safety spokesman Dan Jarvis disputed the study's findings and methodology. He said the idea that a truck's ladder frame has any discernible impact on crash test ratings is "at best uninformed."
Harless cited the Ford F-150 two-door pickup truck as an example of how improvements in crash test ratings do not result in fewer driver fatalities. For the 1992-1993 model years, the F-150 received an NHTSA rating of three stars, Harless said, but the driver death rate was about one death per 10,000 registered vehicles. For the 1994-1996 model years, the F-150 received a five-star rating, but the driver death rate rose to nearly 1.2 driver deaths per 10,000 vehicles.
Independently of Harless, Rader of the IIHS also used the F-150 to illustrate his opposing view that a noticeable improvement in crash test ratings between the 2001 model and the 2004 model correlates with fewer driver fatalities. According to the IIHS's own analysis, the 2001 Ford F-150 had 118 deaths per million per year between 2002 and 2005 when it was rated as "poor," Rader said. But the 2004 F-150, with an improved crash test rating of "good," had a much lower driver death rate of 58 per million vehicles per year.
This is a good indicator of how evaluating crash-test ratings can be confusing. In this case, the study authors pointed to the NHTSA ratings for the F-150, not the IIHS ratings. The study also looked at the F-150 in different years than those cited by Rader.
When asked about the IIHS findings, Hoffer said that he did not doubt their accuracy, but that the model years that Rader gave were different than those used in his own study.
The results for any one particular vehicle aside, Hoffer said the data for cars and trucks overall is what offers the most telling insight. He said there was no relationship between improvements in crash test ratings and driver death rates for "the entire population" of trucks they evaluated, which include model years 1987-2001.
Drawing Conclusions
The conclusion the professors reached was that NHTSA and IIHS crash test data shouldn't be as important of a consideration for pickup truck buyers as it is for passenger-car buyers, because for cars the correlations between ratings and fatalities are stronger. "The architecture of trucks is so different that it overwhelms any information that the consumer can glean from the crash test," Hoffer said.
Anne Fleming, a spokesperson for the IIHS, said that the institute had no evidence that ladder-frame construction, also called "body on frame" construction, typically used in pickup trucks, has any effect on crashworthiness.
Though Ford's Jarvis also disagreed with the professors' conclusions, he did think the study illustrates something important. "The point is well taken that it's indeed very difficult to correlate [crash-test ratings] and real-world crash events," he said. "But that difficulty arises from several factors, including the complexity of the real-world crash environment, and a variety of non-vehicle factors, like was the occupant wearing a safety belt, or was the vehicle pulling a trailer?"
Charles Territo, director of communications at the Alliance of Automobile Manufacturers, also agreed that directly correlating crash test ratings and fatalities is tough. "We don't know what percentage of accidents involved people not wearing seatbelts, being under the influence, being ejected from their vehicles," he said. "There are so many different factors at play that it's just difficult."
The bottom line, Territo said, is that regardless of any conclusion the VCU study made, crash test ratings are still a valuable resource for consumers, but shouldn't be the only consideration when shopping for a vehicle.
Jim Somborovich is an insurance agent for Allstate Insurance Company and can be reached at: js@allstate.com
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AdvertisementSix Ways to Save on Auto Insurance
by Stephanie AuWerter
August 20, 2007
Updated on August 8, 2007.
GOOD NEWS, DRIVERS: insurance premium hikes have hit the breaks. The Insurance Information Institute (III) projects a 0.5% decrease for 2007, bringing average annual costs to $847. This marks the first decline since 1999.
But just because prices aren't breaking the speed limit doesn't mean you should be complacent about costs. With a few relatively painless steps, you can probably find yourself a cheaper policy. Here are six ways to save:
1. Shop Around
You've heard it before: When looking for a new policy, get at least three quotes. And if you really want to save, gather several more than that. According to a 2004 survey of more than 100,000 consumers across the country, conducted by Progressive Insurance, rates for comparable coverage can vary by more than $500 for six months' worth of coverage.
When shopping around, it's crucial that you understand the lay of the land. Broadly speaking, the auto-insurance world is divided into three camps. There are the direct writers (like Geico and Amica), that use in-house employees to sell insurance directly to consumers via the Web or phone. Other insurers, like State Farm and Allstate use captive or "exclusive" agents to sell their products. (These are independent contractors who work predominantly on commission and can sell the products of only one company.) Finally, there are the independent agents who sell the insurance of various different companies. These folks also earn their keep based on commission. (To find a local independent agent, visit the Independent Insurance Agents & Brokers of America.)
Assuming you have a decent driving history, you should get the best deals from the direct agents, since they remove the middleman (who often receives a commission of 15%). But these folks can be picky. So if you've had recent entanglements with the law or another car's fender, your best bet is probably to check with the major providers, such as State Farm and Allstate (which hold 18% and 11% of the market, respectively), and then head to an independent agent to see if he or she can beat your best quote. You also can comparison shop at Web sites such as InsWeb, which operates as an independent agent and a lead generator.
One note of caution: Don't let your quest for a bargain lead you into the dark woods of substandard companies. Make sure you go with a company that has a good credit rating with a rating service such as Standard & Poor's or Moody's. You might also want to check with your state's department of insurance to see if a particular company has a high number of consumer complaints, says Sally McCarty, commissioner of the Indiana Department of Insurance. (Click here to find the Web site of your state's department.)
2. Get All Available Discounts
Discounts can vary widely by company as well as by state. Some to ask about are:
Combination Discounts
You can often knock off 10% to 20% from your premiums if you insure both your home and your car with the same company, or by insuring more than one car with the same company.
Defensive-Driving Classes
This can often merit a 10% discount on premiums.
Good-Student Discounts
Students with GPAs of 3.0 or higher can be eligible for discounts of as much as 25%. In some cases, young male drivers may benefit from this more, since their premiums are typically higher, says Dick Luedke, a State Farm spokesman.
Retirement Discounts
Be sure to let your insurer know when you retire — particularly if you retire at a relatively young age. Since you're likely to be driving less once you're working days are over, this can often earn you a break on premiums.
Association & Group Discounts
Discounts may be available for affiliation with all sorts of associations — your alma matter, a military group, a professional organization, even Mensa. If you work for a large employer, that could earn you a discount as well.
College-Kids-Who-Are-Far-Away Discounts
If at least 100 miles separate your kid from your car, you could save up to 40%.
Safety Discounts
This varies by state. In some states, including New York and Florida, drivers must be rewarded for having certain safety features on their car, such as antilock brakes, airbags and automatic seat belts. Certain antitheft devices could be eligible for a discount as well.
Loyalty Discounts
Stick with the same company for more than one year, and you could earn a break of 10% or more on your premiums.
3. Increase Your Deductible
Your deductible is the amount you'll pay out of pocket when making a claim before your insurance starts picking up the tab. It applies to your collision and comprehensive coverage (not your liability) and is the insurance that specifically covers your car. (For more on the different components of an auto-insurance policy, click here.)
Increasing your deductible can cut your premium dramatically. And since insurance is meant to cover the big stuff you can't handle comfortably on your own (not the small things), having a higher deductible can make a lot of sense. In general, increasing your deductible from, say, $200 to $500 could reduce your premium by 15% to 30%, according to the III. Raising it to $1,000 could save you 40% or more.
4. Drop Some Coverage
If you have an older car — one that's worth less than 10 times the amount you'd pay for coverage — you may want to consider dropping collision and comprehensive coverage altogether, according to the III. Collision and comprehensive can account for 40% or more of the cost of your premium, and covers only the car's replacement value. If any claim payment you'd receive wouldn't substantially exceed your premiums minus the deductible, then it's probably not worth it to get the insurance.
5. Clean Up Your Credit Report
Like it or not, your credit report can affect whether a company is willing to insure you — and at what rate. "Somebody who is extremely poor in their payment habits could pay 30% to 40% more than somebody without those problems," says independent agent John Costello, a partner at Costello Dreher Kaiser Insurance, based in Rochester, N.Y.
While credit-data usage varies by state, most insurers use something called an "insurance score" to assess your risk as a driver. The score is similar to a credit score, except that, generally speaking, an insurance score places a heavier weighting on bill-paying consistency than on the overall debt the person carries, says Jeffrey Skelton, assistant vice president of personal insurance at ChoicePoint, a company that calculates insurance scores.
For $12.95, you can pull your insurance score plus a copy of your credit report at Choicetrust.com, a consumer-oriented Web site run by ChoicePoint. Be sure to keep an eye out for any errors or omitted information that could negatively affect your score.
6. Get the Right Car
If you're in the market for a new car, keep in mind those with the highest theft rates and repair costs will cost more to insure. So if you're debating between two models, it may be worthwhile to give your insurance agent a call to see if there is a notable difference in the insurance costs. Alternatively, you can visit the Web sites of the insurance companies. Many of them, such as State Farm, list which cars are considered safer than average (thus qualifying for a discount) as well as those that have higher collision and theft rates.
Jim Somborovich is an Allstate Insurance Company agent in Bellevue, WA and can be reached at: js@allstate.com
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AdvertisementSix Ways to Save on Auto Insurance
by Stephanie AuWerter
August 20, 2007
Updated on August 8, 2007.
GOOD NEWS, DRIVERS: insurance premium hikes have hit the breaks. The Insurance Information Institute (III) projects a 0.5% decrease for 2007, bringing average annual costs to $847. This marks the first decline since 1999.
But just because prices aren't breaking the speed limit doesn't mean you should be complacent about costs. With a few relatively painless steps, you can probably find yourself a cheaper policy. Here are six ways to save:
1. Shop Around
You've heard it before: When looking for a new policy, get at least three quotes. And if you really want to save, gather several more than that. According to a 2004 survey of more than 100,000 consumers across the country, conducted by Progressive Insurance, rates for comparable coverage can vary by more than $500 for six months' worth of coverage.
When shopping around, it's crucial that you understand the lay of the land. Broadly speaking, the auto-insurance world is divided into three camps. There are the direct writers (like Geico and Amica), that use in-house employees to sell insurance directly to consumers via the Web or phone. Other insurers, like State Farm and Allstate use captive or "exclusive" agents to sell their products. (These are independent contractors who work predominantly on commission and can sell the products of only one company.) Finally, there are the independent agents who sell the insurance of various different companies. These folks also earn their keep based on commission. (To find a local independent agent, visit the Independent Insurance Agents & Brokers of America.)
Assuming you have a decent driving history, you should get the best deals from the direct agents, since they remove the middleman (who often receives a commission of 15%). But these folks can be picky. So if you've had recent entanglements with the law or another car's fender, your best bet is probably to check with the major providers, such as State Farm and Allstate (which hold 18% and 11% of the market, respectively), and then head to an independent agent to see if he or she can beat your best quote. You also can comparison shop at Web sites such as InsWeb, which operates as an independent agent and a lead generator.
One note of caution: Don't let your quest for a bargain lead you into the dark woods of substandard companies. Make sure you go with a company that has a good credit rating with a rating service such as Standard & Poor's or Moody's. You might also want to check with your state's department of insurance to see if a particular company has a high number of consumer complaints, says Sally McCarty, commissioner of the Indiana Department of Insurance. (Click here to find the Web site of your state's department.)
2. Get All Available Discounts
Discounts can vary widely by company as well as by state. Some to ask about are:
Combination Discounts
You can often knock off 10% to 20% from your premiums if you insure both your home and your car with the same company, or by insuring more than one car with the same company.
Defensive-Driving Classes
This can often merit a 10% discount on premiums.
Good-Student Discounts
Students with GPAs of 3.0 or higher can be eligible for discounts of as much as 25%. In some cases, young male drivers may benefit from this more, since their premiums are typically higher, says Dick Luedke, a State Farm spokesman.
Retirement Discounts
Be sure to let your insurer know when you retire — particularly if you retire at a relatively young age. Since you're likely to be driving less once you're working days are over, this can often earn you a break on premiums.
Association & Group Discounts
Discounts may be available for affiliation with all sorts of associations — your alma matter, a military group, a professional organization, even Mensa. If you work for a large employer, that could earn you a discount as well.
College-Kids-Who-Are-Far-Away Discounts
If at least 100 miles separate your kid from your car, you could save up to 40%.
Safety Discounts
This varies by state. In some states, including New York and Florida, drivers must be rewarded for having certain safety features on their car, such as antilock brakes, airbags and automatic seat belts. Certain antitheft devices could be eligible for a discount as well.
Loyalty Discounts
Stick with the same company for more than one year, and you could earn a break of 10% or more on your premiums.
3. Increase Your Deductible
Your deductible is the amount you'll pay out of pocket when making a claim before your insurance starts picking up the tab. It applies to your collision and comprehensive coverage (not your liability) and is the insurance that specifically covers your car. (For more on the different components of an auto-insurance policy, click here.)
Increasing your deductible can cut your premium dramatically. And since insurance is meant to cover the big stuff you can't handle comfortably on your own (not the small things), having a higher deductible can make a lot of sense. In general, increasing your deductible from, say, $200 to $500 could reduce your premium by 15% to 30%, according to the III. Raising it to $1,000 could save you 40% or more.
4. Drop Some Coverage
If you have an older car — one that's worth less than 10 times the amount you'd pay for coverage — you may want to consider dropping collision and comprehensive coverage altogether, according to the III. Collision and comprehensive can account for 40% or more of the cost of your premium, and covers only the car's replacement value. If any claim payment you'd receive wouldn't substantially exceed your premiums minus the deductible, then it's probably not worth it to get the insurance.
5. Clean Up Your Credit Report
Like it or not, your credit report can affect whether a company is willing to insure you — and at what rate. "Somebody who is extremely poor in their payment habits could pay 30% to 40% more than somebody without those problems," says independent agent John Costello, a partner at Costello Dreher Kaiser Insurance, based in Rochester, N.Y.
While credit-data usage varies by state, most insurers use something called an "insurance score" to assess your risk as a driver. The score is similar to a credit score, except that, generally speaking, an insurance score places a heavier weighting on bill-paying consistency than on the overall debt the person carries, says Jeffrey Skelton, assistant vice president of personal insurance at ChoicePoint, a company that calculates insurance scores.
For $12.95, you can pull your insurance score plus a copy of your credit report at Choicetrust.com, a consumer-oriented Web site run by ChoicePoint. Be sure to keep an eye out for any errors or omitted information that could negatively affect your score.
6. Get the Right Car
If you're in the market for a new car, keep in mind those with the highest theft rates and repair costs will cost more to insure. So if you're debating between two models, it may be worthwhile to give your insurance agent a call to see if there is a notable difference in the insurance costs. Alternatively, you can visit the Web sites of the insurance companies. Many of them, such as State Farm, list which cars are considered safer than average (thus qualifying for a discount) as well as those that have higher collision and theft rates.
Jim Somborovich is an Allstate Insurance Company agent in Bellevue, WA and can be reached at: js@allstate.com
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