Insurance Tips and FAQs

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Frequently Asked Questions:

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    1. Will a comprehensive claim affect my premium?
    2. Is my all terrain vehicle (ATV) covered by my Home-owners policy?
    3. Why am I penalized for putting a claim through on my policy? I thought that’s what insurance is for.
    4. My car is five years old. Do I still need collision?
    5. Who is allowed to drive my car?
    6. I have a son who is licensed but I don’t let him drive my car. Nevertheless, my insurance company wants to “charge” for him anyway. What can I do about this?
    7. Do I have to pay for my insurance all at once?
    8. Are parking lot accidents normally split 50/50?
    9. How are driving records determined?
    10. What’s the difference between vacant property and unoccupied property?
    11. What is liability insurance?
    12. What is no-fault insurance?
    13. When to consider extra coverage?
    14. What do I need to get an insurance quote?
    15. Am I covered?
    16. Who needs business insurance?
    17. What extra coverage should I be aware of?
    18. How can I reduce the risk in my business?
    19. What is insurance and why do I need it?
    20. Why use an insurance broker?

Answers:

1. Will a comprehensive claim affect my premium?

While a comprehensive claim will not affect your driving record, it could affect your premium. Two or more comprehensive claims in a short span of time will likely affect your rate. Or, your insurer might ask you for a higher deductible, not offer this coverage, or cancel you altogether if you’ve had a number of comprehensive claims. Examples of comprehensive claims are theft, vandalism to your vehicle, or glass damage due to a pebble coming up from the pavement.

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2. Is my all terrain vehicle (ATV) covered by my Home-owners policy?

No, ATVs are excluded from Home-owners policies. You must buy an Auto policy for them. You can be charged by the police for driving with no insurance by merely crossing the road on one.

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3. Why am I penalized for putting a claim through on my policy? I thought that’s what insurance is for.

Insurance is about risk sharing where the losses of the few are spread among the many who contribute small and like amounts to the insurance pot. Thus, your personal contribution to the pot is based on your own loss history as well as that of the group. So your insurance will pay for your claim. But, your claim might result in a reassessment of your loss history which could result in a higher premium for you in future. Thus, the claims you submit affect your future insurance payments.

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4. My car is five years old. Do I still need collision?

We would say ‘yes’, because a five year old car has more value than the amount of your insurance premium. But it is up to you.

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5. Who is allowed to drive my car?

Technically, anyone to whom you give permission is allowed to drive your car. This is because your insurance is attached to your car, regardless who is behind the wheel. But, if a driver you’ve authorized gets into an accident with your car it is your driving record that is affected. In Nova Scotia, all licensed vehicle owners must carry liability insurance. Liability coverage is extended to any person who holds a valid license and drives your car with your consent. Insurance companies want to know if there is anyone else besides you who drives your car on a regular basis.

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6. I have a son who is licensed but I don’t let him drive my car. Nevertheless, my insurance company wants to “charge” for him anyway. What can I do about this?

The reason that insurers include “all licensed individuals in the household” as part of their premium calculations is that they are not allowed to refuse to settle a claim with your car. Some insurers, however, will allow you to sign a document stating that if your son has an accident with your car that you will reimburse the company if it pays out a claim. The best thing to do is ask your broker.

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7. Do I have to pay for my insurance all at once?

Some companies and brokers allow payment plans of various kinds. But if your premium is minimum and retained it is unlikely you well get a payment plan. The best thing to do is ask your broker.

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8. Are parking lot accidents normally split 50/50?

Not always. With many parking lots having roadways marked by specific lines of travel, the usual road rules may apply. Thus, when assessing fault, adjusters will look at the damage of the cars and how and why the collision occurred.

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9. How are driving records determined?

Driving records are determined primarily by the number of vehicle accidents and traffic convictions you’ve had.

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10. What’s the difference between vacant property and unoccupied property?

Property is deemed to be vacant when the occupants have moved with no intention of returning regardless whether they left personal property behind. Insurance will not cover vacant property. Property is deemed unoccupied when there is an intention to return to it. Insurance will cover it

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Auto Insurance:

11. What is liability insurance?

Liability insurance covers the cost of damages (for accident benefits, medical costs, lawsuits and awards) in the event of personal injury or death from an accident involving the insured party. In other words, you are financially protected if you are held liable for an injury or loss by others arising from the operation of your vehicle.

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12. What is no-fault insurance?

Many provinces in Canada now have some level of no-fault insurance in which each person’s own insurance company pays for injury or damage up to a certain limit.This applies regardless of whether or not the insured person was at fault. In Quebec and Manitoba, for example, there is a pure no-fault. In Ontario, however, there is a threshold system in which the no-fault clause only applies up to a certain threshold of liability. So, if you are involved in an accident and injured, your own insurance covers the associated costs of treatment, living expenses, loss of work and pain and suffering.

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13. When to consider extra coverage?

The recommended level of liability insurance coverage is usually about $1 million.There are some situations in which you might want to increase your liability limit depending on the use of your vehicle. For example, if you drive into the U.S. on a regular basis, where liability settlements are generally higher than in Canada, you might want to consider higher coverage. If you carpool to work or drive groups of children in your car to school or after-school events, you might want to increase your coverage to reflect the higher risks to which you are exposed.

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14. What do I need to get an insurance quote?

The more information, the better.
Getting your application right can have a significant impact on your premiums. Be sure to ask your broker for advice and help. Whether you are transferring your insurance from another province, seeking to change insurers or owning a car for the first time, the process of getting an insurance quote can be daunting. In general, the more the insurer knows about you and your driving record the better off you will be, even if your record is less than perfect. Full disclosure at the beginning will save any risk of misrepresentation if you do need to make a claim in the future. This is an area where your broker can be of particular assistance, helping you to navigate the terrain.There are three main categories of information required:

1. Information about you

• Names of the drivers of the vehicle to be insured.This usually includes all licensed members of your household since it is assumed that they will use the car. Provide their names as shown on their license, the number of years licensed and the percentage of time they will use the vehicle.

• Driving records of all applicants will be screened to identify applicants with undesireable driving records.This will include driving convictions in the last three years and accident claims in the last six years.

• Insurance history for the preceding three to six years must be provided, including any cancelled, declined or refused insurance. • License history of all listed drivers must be provided for the preceding six years, including suspensions, cancellations or lapses.

• In provinces that have public insurance, all required information is already captured by the government.

2. Information about the vehicle Full information about the make, model and year are required as well as the Vehicle Identification Number or VIN. Also include the details of a lease if you have one, the purchase value, whether new or used, and the value of any modifications to the vehicle. If any other party has a financial interest in the vehicle this should be recorded so they are protected in the event of a loss.

3. Information about your coverage requirements Finally, you will need to provide information of how the vehicle will be used. Is it for pleasure or business? If it is for commuting, what is the daily estimated distance? What will the annual distance be? If for business use, will you be carrying paying passengers, renting the car out to others or transporting any goods? You will also need to indicate your choices regarding your coverage, for example, your preferred deductible, liability limit and coverage for any special situations, including storing the car or driving in the U.S. Your Best Insurance is an Insurance Broker

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15. Am I covered?

Every policy is different but there are some common situations to be aware of. Auto_Special Coverages Ask your broker for more information about liability and how to obtain the right level of coverage. Your vehicle insurance policy likely has some flexibility built in to ensure you are covered in different situations.You should check your policy or ask your broker to be sure.

Renting a car
If you drive a rented car or any vehicle that is not owned by you, your existing vehicle insurance covers physical damage to the vehicle, accident benefits and third-party liability to the same limits that apply in your policy. Note, this is only true if your insurance is issued to you as an individual. If your vehicle insurance is issued to your business, you are not protected when driving non-owned cars. Also, if you rent a luxury car but have a sub-compact insured, you might not be covered for the cost of repairs to the luxury vehicle. In these cases, you should purchase the insurance offered by the renter. If you are a frequent renter, add an endorsement to your car insurance policy. These can be simple to arrange, and far more economical than the costly damage waivers that rental car companies charge.

Traveling outside the province or country
Your insurance will apply if you take your car on short trips to other provinces or into the continental U.S., as long as you engage in normal use of the vehicle.

Moving to another province
If you are relocating long-term or permanently, you must inform your insurer and arrange for new coverage that reflects the risks in your new location.

When the car is “in the shop”
Under most insurance policies, you are not entitled to a replacement vehicle while your car is in the shop for normal maintenance or repair. If you lose the use of your car because of an accident then you might be entitled to a loaned vehicle depending on the situation.

When driving someone else’s car
If you borrow someone else’s car you are covered by the insurance on that car. However, if you are involved in an accident, the owner’s record, not yours will be affected. If you are a regular borrower, ask your broker to arrange a special clause in your policy to cover your use.

When someone else drives your car
Remember that when someone else is driving your car, you are still responsible for it.Any at-fault accidents or claims will go onto your driving record and affect your future premiums.

Don’t guess..
If you are not sure about your coverage, it’s better to give your broker a quick call than to guess. Remember, if you’re not covered and an accident occurs, the insurer is not obliged to pay.

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Business Insurance

16. Who needs business insurance?

The right insurance is an important tool to protect any business.
Anyone operating a business, whether it’s home-based, a large industrial operation or a professional services office, needs commercial insurance as part of an overall risk management strategy.
Every business has unique requirements
Your commercial insurance should be designed to protect against the most prevalent risks to the assets and capital in your business.Your broker can help you itemize and quantify those risks, and determine the level of coverage you should consider. Risks include:
Property loss.
Insurance against property damage or theft protects the physical assets that support your business including buildings, equipment, vehicle fleets and inventory, as well as intangible assets such as licenses, patents and accounts receivable.To arrange the right level of insurance you must know your rights and obligations as an owner, tenant, leaseholder, landlord or mortgage holder. You must also take into account local bylaws on standards for physical repair and reconstruction.
Liability loss.
Every business is exposed to liabilities and should be protected against the major ones, including personal injury, product failures or negligence.
Personnel loss.
Group health and benefits insurance can help to improve employee retention and well-being thereby reducing the cost of turnover and lost time.
Net income loss.
Some businesses are exposed to specific perils that are beyond their control and that would cause critical damage to the viability of the business. For example, a food services operation might insure against a major electrical outage that would result in spoilage of their inventory.
Consider the underlying risk– drivers in your business
An experienced commercial insurance broker can help you read the risks in your business, advise you on how to reduce some of the more manageable exposures and suggest an insurance mix that takes your risk tolerance and financial situation into account.The following are examples of common risk drivers:
• Heavy reliance on limited sources of income
• Dependence on one or a few people to run the business
• Elaborate and specialized physical assets
• Extensive international operations
• Sensitivity to factors outside your control, such as weather and commodity prices
• Labour unrest
• High levels of inventory
• Large vehicle fleets
• Rudimentary workplace health and safety practices
• Dangerous materials handling
An ounce of prevention
Ask your broker about arranging a complete loss-prevention audit to identify possible hazards in your operations and to suggest improvements and optimum coverage.

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17. What extra coverage should I be aware of?

Special policies can cover the risks unique to your business.
These are just a few of the special coverages available for special situations, Your broker can tell you more.
Business Interruption
This form of insurance provides you with the funds required to protect your business financial position if your operations are interrupted by an insured loss such as a fire. Features and costs will vary considerably depending on whether you insure for named perils, a specific timeframe, specific costs or just a portion of the income you lose.This form of insurance is highly customizable and can include coverage for extra business expenses, rental income lost, gross earnings lost, payroll and professional fees. Consequential Loss
A consequential loss is not caused directly by damage to property but is a consequence of other damage. For example a cold storage facility might experience significant inventory losses if an on-site transformer station failure cuts out electricity supply or a fire damages the refrigerators. A greenhouse operation or a winery might require constant temperature and humidity to be maintained and would insure against the consequences of an extreme change in those factors.
Equipment Breakdown
Many named perils and broad commercial property insurance policies will exclude coverage of breakdown or damage to highly sensitive or specialized equipment including high-pressure boilers, control systems and computers, diagnostic equipment and more. Special machinery policies can be obtained to cover equipment for sudden and accidental breakdown, which is advisable if loss of use is a significant risk for your business. Errors and Omissions and Director’s and Officer’s Liability
It is common practice to protect company directors and senior managers from personal liability for actions that are the responsibility of the company they direct.While insurance does not remove their fiduciary duty, it does provide some financial protection from legal liability for a claim made against them for an alleged or wrongful act. A wrongful act is any error, misstatement, misleading statement, act omission, breach of duty or neglect allegedly committed or attempted. Errors and omissions insurance is usually used in professional services firms such as law, accounting and consulting to protect professional staff from the impact of errors and omissions in their work.
Specialized Coverages
There are as many forms of specialized coverage as there are risks to your business. A broker can help you assess the probability of experiencing a loss and determine whether or not you should purchase specialized coverage.Talk to your broker to see if there are risks unique to your business that require extra protection. For example:
• Crime – designed to protect against loss of money or securities, including theft overnight or on the way to the bank.This also includes employee dishonesty.
• Electronic Data Processing Systems – protects your computer and its data.
• Sewer Back-up – covers loss or damage caused by the backing up of sewers, sumps, septic tanks or drains.
• By-law Coverage – covers additional expenditures resulting from by-laws regulating construction when reinstating a building after a loss.

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18. How can I reduce the risk in my business?


A risk management program is the best way to systematically reduce the impact of risk.

Risk Management
Your commercial insurance broker has the experience to help you manage the insurance risks in your business. Your Best Insurance is an Insurance Broker An experienced commercial broker knows how to identify and manage many of the risk factors in your business and translate that knowledge into a cost-effective risk management program. There are four key steps:
1. Know your risk exposures
The first step is to accurately identify and analyze the risk exposures to your tangible and intangible property, your income, personnel and liabilities.These can be determined in a thorough audit of your office, warehouse or shop floor to identify all perils, probabilities and potential financial consequences.

2. Consider the risk management alternatives

Insurance is one form of “financing” your risk, but there are other alternatives to explore.These include eliminating the exposure, loss prevention, loss reduction and contractual transfer of responsibility for losses, for example, when a lessee assumes the liability for damages to leased space.A thorough risk management plan will examine all these alternatives before getting to the issue of insurance. Commercial insurance is the most widely used of all risk financing techniques because of the cost-effective protection it provides. General and specialized policies can cover just about any peril. Another way to manage risk is to be financially prepared for a loss. One way to do this is to accumulate your own capital reserves to cover the loss, but this can tie up large amounts of capital at low rates of return.
3. Implement your plan
With loss prevention and reduction plans in place, your broker can help you implement your insurance program with one or multiple insurers.
4. Monitor and adapt your plan
Make sure to adapt your plan to match the changes in your business including geographical expansion, physical growth, new lines of business or increased complexity. Consider an annual review of your needs with the help of your insurance broker.

Don’t just manage your insurance, manage your risk.
A bit of planning and an ounce of prevention can save you time and money.

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General Insurance

19. What is insurance and why do I need it?

Insurance has many forms and functions but really just one purpose–to provide peace-of-mind.
Four good reasons to insure
In some cases insurance is mandatory– to obtain a mortgage for example or to drive a car. Otherwise, the choice is yours, but it’s a wise choice for four main reasons:

      1. Reduces worry. With the right type and amount of insurance, you can be protected from the risks to property and person that are inherent in everyday life.
      2. Makes it easier to obtain credit. Lenders may be more willing to extend personal or commercial credit if they know that proper insurance is in place.
      3. Helps to prevent loss. Brokers and insurers work to help prevent loss with information and advice on road safety, anti-theft, fire prevention and fraud reduction. 4.Frees up capital. Because insurance protects your assets, you do not have to put money aside in case of future losses.This security applies to individuals and businesses.

Three main types of insurance

In addition to life and health insurance, there are three main types of property and casualty insurance in Canada:

      1. Automobile insurance in which vehicles and their equipment are covered in cases of accidents and theft
      2. Property insurance in which home and business assets and property are protected from perils such as fire, theft and accidental damage
      3. Liability insurance which protects people who are responsible for injuries or damages to third parties

Two key players: your insurer and your broker
Insurance is sold in a number of ways, some of which make it easier for customers to get objective advice and rapid service. Some insurance companies will sell directly to customers through their sales forces or agencies. Brokers, on the other hand, are not tied to any one company, but are independent advisors whose best interest is long term customer satisfaction. Brokers can comparison shop across insurance companies to find good rates or special insurance products. Your broker can tell you more about the basics of insurance and can help you make sure your needs are covered.

A definition:
Insurance is a contract in which the insurer agrees to compensate the insured for specific losses and specific perils.

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20. Why use an insurance broker?

Why use an insurance broker?

Your broker works for you, not the insurance company. They are at your side when you buy or upgrade your insurance or if you have to make a claim.

Brokers The value of objective advice
Insurance brokers are business people whose success rests on your satisfaction with your coverage, price and service. It’s in their interest to understand your needs and negotiate on your behalf for competitive premiums–even if it means approaching several companies to find the right solution. Because your broker doesn’t work for the insurance company, he or she can also assist you with objective advice if you have to make a claim.

Get informed help when you need it most
The insurance industry has become more complex with its own language of terms, legal issues and subtle details.You need a knowledgeable expert at every stage of the process to interpret all the rules and what they mean for you.Your broker’s advice can also be invaluable as your insurance needs change and your requirements become more complex.

Finding a licensed broker is easy
There is a well developed system of broker licensing in Canada so you can feel confident that your licensed broker is a certified professional. One of the best ways to find a broker is to ask family, friends and co-workers for a recommendation. Or, if you have access to the Internet, visit www.findabroker.ca and follow the links to a broker in your community. Finding a broker who understands your needs is an important first step to being properly insured. Take the time to find someone you feel comfortable with.

Don’t be afraid to ask! When it comes to insurance, there is no question too basic. If there is anything you don’t understand, don’t be afraid to ask us. We are here to help.

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Hours of Operation

Please note: Due to Coronavirus COVID-19 our offices are now restricted to staff only.
St. Peters NS ♦ (8:30 to 5:00 - Mon to Fri)
Arichat NS ♦ (8:30 to 4:30 - Mon to Fri)
After Hours ♦ 902-565-1282 ♦ 902-631-1023
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Bluenose Insurance Brokers is dedicated to providing the best insurance products available to its clients at the most reasonable rates.

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