This article has been reviewed by licensed insurance industry expert Moshe Fishman on 1/6/2025.
Receiving a cancellation notice from your auto insurance company can come as quite a shock. You’re probably wondering why your auto insurance is being canceled and how it’ll affect your ability to find insurers to issue you a new policy.
Many people are surprised to learn that auto insurance can be canceled for numerous reasons. Let’s look at the most common reasons why an auto insurance company would cancel your policy. Keep in mind that these reasons could apply to any driver who’s on your policy.
One of the most common reasons for auto insurance cancellation is due to a lack of payment. If you don’t make your car insurance payment in a timely manner, it’ll be canceled. Although most insurers give their customers a 30-day grace period for non-payment, after the 30 days are up, your insurance may be canceled.
If you‘re wondering if your low credit score can have your policy canceled, it is more likely to affect your insurance premiums. You can find out what information is in your credit report by requesting free credit reports from Equifax, Experian, and TransUnion. You will see your Fico score, the credit accounts they monitor, your credit card usage, payment history, and similar.
Should your policy be canceled due to lack of payment, this information will not show up on your credit report. According to Experian, “your policy doesn’t appear on your credit report” as insurers don't typically report payments to the credit bureaus.
If you provide false information when obtaining an auto insurance quote or on your application, and your insurer finds out about it, your policy can be canceled. Even lying through omission can be sufficient reason for your insurance company to cancel.
For example, say you failed to add someone who regularly drives your car or mistakenly give the wrong address where your car is garaged. Providing false or inaccurate information is considered material misrepresentation and is grounds for cancellation.
This should be a no-brainer. If you have too many at-fault accidents, speeding tickets, or moving traffic violations, your insurer could cancel your policy.
License suspension is a serious matter. If your driver’s license is revoked or suspended, your insurance company is within its right to cancel your policy. There are many reasons why a driver’s license can be revoked or suspended such as driving under the influence of drugs or alcohol, unpaid parking tickets, a failure to pay court-ordered child support, and leaving the scene of an accident. Whatever the reason, do not drive without insurance.
Making a fraudulent claim or including false information when you file a claim are grounds for cancellation. When filing an auto insurance claim, be sure to include only true and accurate information on your claim forms.
Having certain medical conditions that affect your ability to safely operate a vehicle can result in an insurance cancellation. If you’re diagnosed with epilepsy or a heart condition, you may be required to provide a physician’s certification stating that you’re able to drive safely.
If you’re convicted of a felony or a serious crime involving a motor vehicle, such as driving under the influence or committing assault, your policy could be canceled. Your state's Department of Motor Vehicles will have information about this.
Driving a vehicle that fails to pass an inspection or one that has severe mechanical problems that cause it to be a threat to public safety are grounds for cancellation. Maintaining your vehicle and staying on top of state-required inspections are necessary to keep your car insurance.
If you’re using your car for business purposes, your policy could be canceled. If you’re a rideshare driver for Uber or Lyft or using your car to deliver food or groceries, these are considered “business use.” Failure to obtain a commercial auto policy or a rideshare add-on when using your car for commercial or business purposes can result in losing your insurance.
Insurance companies are required to notify policyholders in writing about their auto insurance cancellation. They must notify you of the reason for terminating your policy and when it will take effect. This amount of time between receiving notification and the day the termination takes effect varies depending on individual state laws. Check with the Department of Insurance in your state.
Once you receive a notice, contact your insurance company immediately. Ask why your insurance is being canceled and clarify any misinformation your insurer might have. If your insurance is being canceled due to non-payment, you may be able to get your policy reinstated by paying off the premium. It's easier than finding coverage with a new insurer.
Paying off your parking tickets and traffic violations might also result in your policy being reinstated. However, if your insurance is being terminated for a suspended license or DUI conviction, you’ll be unable to get it reinstated.
The reason for your policy cancellation will determine your ability to get new car insurance. If the reason is a minor one or was a simple mistake, you’re more likely to easily find a new insurance company that’s willing to give you a policy.
For example, if you forgot to disclose that you added another driver or for non-payment of your premium. You can expect to pay a higher premium after losing your policy. Comparing quotes from different companies is a good idea. Insurance rates do vary by company.
If your license has been revoked or suspended or if you’ve been convicted of driving under the influence, finding new coverage from standard providers will prove difficult. You’ll need to check with insurance companies that specialize in what is known as “high-risk” auto insurance.
Assigned-risk pools are state-sponsored organizations that help high-risk drivers obtain auto insurance. If you’re unable to obtain insurance from a high-risk insurer, coverage should be available through your state’s assigned-risk pool. Depending on what state you’re in, this is also referred to as a “shared market” or “residual market.”
Assigned risk auto insurance is only available to high-risk drivers who’ve been denied auto insurance from standard and high-risk auto insurers. In every state, auto insurance providers are required to participate in the assigned-risk pool.
Once you’re granted coverage through your state’s assigned-risk pool, expect to pay higher premiums for the minimum level of coverage required by your state. And that minimum varies by state. After three years in an assigned-risk pool, drivers who’ve paid their premiums and kept a clean driving record should be able to return to a standard insurance company.
If you’ve been issued a cancellation notice from your current auto insurance provider, don’t delay when it comes to finding new coverage. You don't want to be caught driving without insurance. That is a crime in most states and even a short lapse in coverage can result in higher premiums.
This article has been reviewed by licensed insurance industry expert Moshe Fishman on 12/26/2024.
You’ve been in a car accident. The other driver is at fault. That means the other driver’s car insurance will pay for everything, right? Not necessarily.
Suppose the other driver doesn’t have auto insurance, or their insurance won’t cover the damages. They may even flee the scene of the accident. Scenarios such as this are why uninsured motorist coverage exists.
You might also be surprised to learn that uninsured motorist coverage isn’t a requirement in most states. Learn about uninsured motorist coverage and underinsured motorist coverage to understand the differences between these two types of coverage and whether they’re something you should consider adding to your auto insurance policy.
Depending on which state you live in, uninsured motorist coverage is either an optional or required policy addition that provides coverage for damages and injuries sustained in an auto accident because of the actions of an uninsured driver.
Uninsured motorist (UM) coverage takes effect in the event of an accident where the other driver is at fault and:
Uninsured motorist insurance is represented by two coverage types as follows:
Some drivers only carry the minimum amount of liability coverage legally required by their state. Their liability limits might easily be exceeded. Underinsured motorist coverage protects you in the event of an accident caused by a driver who has insurance but isn’t sufficiently insured to cover the total amount of damages and costs.
When it comes to Underinsured Motorist coverage, you’ll find that there are two types of coverage.
Covers the gap between the at-fault driver’s liability insurance limits and the total expenses of medical bills and any wages that were lost as a result. , etc. But does not cover vehicle repairs or medical bills in an accident that you cause.
Underinsured Motorist Property Damage or UIMPD covers the gap between the at-fault driver’s liability insurance limits and the total amount of damages to your car or your property.
Understanding Uninsured Motorist Insurance is noted by 100/200. The first number refers to the amount of bodily injury coverage per person. The second number refers to the amount of bodily injury coverage per accident.
Does Uninsured Motorist Coverage pay for hit-and-run accidents?
Yes, uninsured motorist coverage provides coverage in the event of a hit-and-run accident. If your car is damaged while parked and the person at fault doesn’t leave a note, this should also be covered.
Currently, there are twenty-two states requiring uninsured motorist insurance. Here is the list in alphabetical order: Connecticut, Illinois, Kansas, Maine, Maryland, Massachusetts, Minnesota, Missouri, Nebraska, New Hampshire, New Jersey, New York, North Carolina, North Dakota, Oregon, South Carolina, South Dakota, Vermont, Virginia, Washington DC, West Virginia, and Wisconsin.
The percentage of people driving around without insurance varies from state to state. In 2019, the state with the highest number of uninsured drivers was Mississippi, where approximately 29.4% of drivers did not have insurance. According to the Insurance Research Council, other states with a high number of uninsured motorists include Mississippi, New Mexico, Michigan, and Tennessee. The state with the lowest number of uninsured drivers in 2019 was New Jersey, where only 3.1% of drivers did not have insurance.
Even if you have good health insurance, uninsured motorist coverage is a good idea for several reasons. UMBI and UIMBI will cover the medical bills due to the accident including co-pays and deductibles. Depending on your insurance, this could save tens of thousands of dollars.
With health insurance, you might be limited to a network of providers, whereas UMBI will pay for care from a wider variety of sources. For serious accidents that will require months of rehabilitation, being able to choose your provider is a definite advantage. Also, UMBI pays for the medical bills of the passengers who are in your car at the time of the accident.
Uninsured motorist coverage is cheaper than you’d think, especially considering how much it can save you in the event of a major accident. Depending on which state you live in, the cost of uninsured motorist coverage depends on the number of uninsured motorists in your state and tends to be higher in states with a high percentage of uninsured motorists.
However, uninsured motorist coverage generally runs between $50-$75 per year. This includes both bodily injury and property damage coverage. The usual factors will affect the premium cost such as the policy holder’s age and driving history and how much coverage is purchased.
Unless you live in a state where uninsured motorist coverage is required, you’re not required to have it. However, that doesn’t mean that you shouldn’t consider adding it to your policy. Considering the relatively small expense, the peace of mind that it’ll provide is worth the cost. Check with your insurance agent or carrier to see how much it’ll cost to add uninsured motorist coverage to your policy.
This article has been reviewed by licensed insurance industry expert, Moshe Fishman on 12/10/2024.
Do you ever use your car for business purposes? Are you a small business owner who occasionally asks employees to use their personal cars for business purposes? If so, you may need commercial auto insurance. That’s because a personal car insurance policy doesn’t cover the use of a personal vehicle for the transportation of goods or business ventures.
But what exactly is considered “business use” and “personal use?” The difference between personal use and business use can be tricky to define, even when consulting the definitions provided by car insurance companies.
In a nutshell, vehicles used for any business purposes will need to be covered under a commercial auto policy. In addition, if you ask your employees to drive for business purposes, you need commercial auto insurance. So, this means company cars and family cars used for business purposes.
Take a look at these scenarios illustrating the differences between personal versus commercial uses and the appropriate category of insurance coverage:
| Personal Auto Insurance | Commercial Auto Insurance |
| Picking up morning coffee for co-workers. | Delivering coffee to customers as a food delivery driver. |
| Driving friends to a party or a camping trip. | Transporting clients to work-related events or log high mileage driving to job sites. |
| Picking up a friend at the airport. | Picking up clients at the airport. |
| Driving to the construction site where you work. | Hauling equipment to a construction site for your company. |
Once you determine the extent of use of a vehicle for business purposes, it’s important to provide the insurance policy with the right type of coverages.
Commercial auto insurance is like personal auto insurance in that it covers liability, comprehensive, collision, and uninsured motorists. Usually, the premium is more expensive, and the coverage limits are higher. This is because vehicles are used more frequently and are thus more likely to be involved in costly accidents.
There are additional types of commercial auto coverage that are included with commercial auto insurance that are generally not available with personal auto coverage. Here are some of these additional coverages.
Generally, commercial auto insurance doesn’t cover tools or equipment being carried or transported by the vehicle; these would be covered under a business owner’s policy. A homeowner’s or renter’s insurance policy would cover personal belongings in the vehicle.
No. Commercial auto insurance does not apply to business owners and contract employees who work for ridesharing companies. Rideshare insurance is required for drivers who work for companies such as Uber and Lyft.
Premiums vary from company to company so it’s best to shop around to ensure you or your company are getting the best price. Commercial auto insurance is guaranteed to be costlier than personal auto insurance. Coverage limits tend to have a minimum of $500,000 and can be more than $1 million.
Insurance carriers use several factors to determine their rates. These are the main factors that influence the price of a commercial auto insurance premium:
If you work for a company and use your personal vehicle occasionally for work, a personal policy with the right coverages may meet your needs. When getting a quote for a personal insurance policy, be sure to mention that your car is being used occasionally for business.
If you change employers and this becomes a requirement for your job, you should let your current insurance company know. Not letting your insurer know may result in not being covered for any work-related accidents, even if you use your vehicle for work infrequently.
When it comes to commercial auto insurance, it’s better to be covered than be sorry when the unexpected happens. Check with your insurance company to see what type of policy is right for you.
This article has been reviewed by licensed insurance industry expert Moshe Fishman on 11/27/2024.
For many people, running a small business out of the home has its advantages. The ability to be your own boss, set your own hours, the lack of a commute and potential tax breaks are some benefits. Working from home in your pajamas is definitely a dream if you’re a late riser.
But what about the drawbacks when you run a home business? What things should you be aware of that could spell trouble for home business owners? If you’ve ever thought about starting a home business, here are the pros and cons of home-based businesses that you should consider before you start your business.
The ability to make your own hours and set your own schedule is a decided advantage to operating a home business. If you’re a night owl, you might find that you get more done working late at night, something a traditional office job doesn’t allow for. You might want to work weekends and leave weekdays free for appointments and errands. You can also take a vacation whenever you want without having to worry about being blocked out during “crunch times” at a typical 9-5 job.
Not having a commute saves time, money, and the aggravation of driving back and forth to an office. Just the idea of driving in traffic can be stressful and take a toll on your health. Plus, you’ll pay a lot less for gas, car maintenance, and auto insurance.
Working from home allows you to keep up with household tasks and chores that tend to pile up when working a 9-5 gig at the office. You’ll no longer dread coming home to piles of laundry, stacks of dishes, and an empty refrigerator. Instead, you can start a load of laundry or dishes and run errands whenever you need to and when it’s most convenient.
The initial startup costs of a small business are significantly reduced for home-based businesses. You’ll save on the cost of office furniture and equipment, the installation of a phone system, renting commercial office space, and the subsequent utility bills and insurance. These advantages might simplify your startup business plans, and help you run a successful home business.
The tax benefits of running a home-based business are plentiful. You can deduct expenses associated with your business such as equipment, gas and mileage for your car, property taxes, part of your rent or mortgage insurance, and even some home maintenance expenses such as remodeling or expanding your home.
If you use a part of your house or apartment exclusively and regularly for your business, such as a guest bedroom or garage, you’ll qualify for a home office deduction. The key words here are exclusively and regularly. To claim this deduction, you can’t use that extra bedroom as both an office and a guest room. Regular use entails using it consistently for business purposes.
Not only will you avoid office politics, but you also won’t have to adhere to an office dress code. This means you can work in pajamas or dress up—it’s entirely up to you. You’ll skip the water cooler talk and probably be happier for it.
Although being your own boss means avoiding conflicts with a real boss, it also means you need to be disciplined to get work done. With no one hassling you about deadlines or supervising your work, your level of productivity and the quality of work you produce are entirely up to you.
When you answer only to yourself, you’ll need to be disciplined, diligent, and efficient to accomplish your business goals. If you lack self-discipline, being a home-based small business owner may not be for you.
If you live with roommates or a spouse/partner and have children or other household members who put demands on your time, creating a distraction-free work environment might prove difficult. Family responsibilities, domestic conflicts, and constant interruptions may impede the ability to be productive. Having a dedicated, private space for conducting business might be impossible to maintain.
On the other hand, running a home-based business can interfere with your ability to devote time to your family. Even though you’ve set your own work schedule, once your business takes off, you may find that you’re working evenings and weekends to keep up with the work demands. This can put a strain on family time if it’s frequently being taken up by your business. Establishing a work/life balance is essential for people with families.
Working from home can be a lonely and solitary process, especially if you run a small business that doesn’t require you to leave the home. It can be especially difficult for people who have spent their careers working in collaborative, social settings. Some people find inspiration and motivation from brainstorming meetings and bouncing ideas off coworkers. Without the camaraderie, inspiration, and socializing of an office, you may find you’re just not as motivated as you once were.
Depending on the type of business, running it from your home has the potential for credibility issues among potential clients. You’ll need to project an image of professionalism if you’re in an industry where this is important.
If you’ll need to meet with clients, creating a space where you feel comfortable meeting them will be challenging. If you’re not comfortable with having potential clients in your home, you can arrange to meet at a café or restaurant or consider renting a coworking space that offers meeting rooms.
All businesses must provide an address for public and corporate records, even if your business is entirely online. When your home address is your business address, you might have concerns about safety and privacy. You might run afoul of local zoning laws, and/or require specialized licensing and permits to run your business from home.
Options to avoid listing your home address as your business address include registering for a Post Office box, mailbox service, or coworking space.
Without a brick-and-mortar store, you won’t get customers off the street. You’ll need advertising materials and marketing campaigns to let people know about the products or services your business provides. Opportunities for networking will also be minimum due to the lack of interaction with other people.
There are many advantages and disadvantages to running a home-based business. And not all of the potential benefits or drawbacks are listed here. For example, you’ll want to be sure to check with your insurance agent on the need to purchase a commercial policy when running a business out of your home.
Ultimately, it’s up to you to decide whether you have what it takes to make it work despite the potential drawbacks. You might find that a combination of working from home and renting a coworking space is the ideal fit.
So, we decided to answer the question that’s on so many people's minds.
This article has been reviewed by licensed insurance industry expert Moshe Fishman on November 8, 2024.
More and more people are working as delivery drivers for companies such as Instacart, Amazon Flex, Doordash, Grub Hub, Uber Eats, and others. It’s easy to see the appeal of being a food delivery driver, with the many perks they offer. You can set your own schedule and hours and work part-time to supplement your income. Or make it a full-time gig.
Most auto insurers prohibit the use of a personal vehicle for the transportation of goods and for any type of personal business venture. Although many delivery service companies provide auto insurance coverage to their employees, it’s easy for delivery drivers to assume this insurance covers fully the damages caused from a car accident.
Delivery companies consider drivers to be independent contractors and as such, do not have to provide extensive insurance coverage to their employees. These coverage gaps are more common than people realize.
If you’re considering becoming a delivery driver or already work as one, delivery driver insurance is essential. This special type of insurance, sometimes called food delivery insurance, is different from rideshare insurance which is for Uber and Lyft drivers.
Rideshare insurance may not provide coverage for the delivery of food, groceries, or packages. Read on to learn about how to properly insure yourself and your car in the event of an accident while working as a delivery driver.
Business and commercial car insurance policies are smart options, although the insurance cost may be high. There are also add-on coverage options you can add to your coverage. Without the proper add-ons, your personal insurance company can deny your claim or drop you as a customer if they discover you’ve been using your car to deliver food or other items. Worst case scenario, you could be charged with insurance fraud.
The amount of coverage that delivery companies provide varies from company to company, if they provide any coverage at all. It’s also essential to know that each company has specific rules that apply during each stage of the delivery process. For example, they may cover incidents that occur during these phases, assuming the driver is logged into the company app:
If you’re considering working for a specific delivery company, say to deliver pizza, it’s essential to know what coverage is provided. However, because many delivery drivers work for multiple companies, consider getting personal rideshare insurance which extends auto coverage to all phases of the delivery process.
DoorDash:
Amazon Flex:
Postmates:
UberEATS:
Instacart and Grub Hub:
Unlike other delivery services, Instacart and Grub Hub do not provide vehicle insurance or auto coverage to their drivers. If you want to drive for either of these companies, there are insurance options for drivers. Many insurance companies have the option of purchasing a reasonably priced add-on policy.
When contacting your insurance company, be sure to specify that you are driving for Instacart and/or Grub Hub. Depending on the insurer, you may need to purchase a rideshare add-on policy or a separate commercial auto insurance policy. Here are some options:
Even if you’re only working occasionally as a seasonal driver, you may still need additional coverage to protect yourself. It’s better to be safe than sorry. Check with your insurance about what’s required for seasonal work.
New York State has specific rules about commercial driving insurance. If you’re a New York resident, be sure to check with your insurance company before taking on work as a delivery driver.
There are two circumstances where delivery drivers might not need to purchase additional coverage: if you use your car for employer deliveries on a temporary basis and if you make deliveries with a vehicle owned by your employer.
Check with your insurance company.
Delivery driver insurance will protect you and your assets from fiscal responsibility in the event of an accident, theft, or vandalism while working as a delivery driver. Check with your insurance company to make sure you’ll be fully covered. If your current insurer doesn’t provide any coverage, it may be time to shop around.
This article has been reviewed by licensed insurance industry expert, Moshe Fishman on October 30, 2024.
Borrowing and lending cars between friends and family happens every now and then. Say a friend’s car is in the shop and they need to borrow your car for a day to get to work. Or you’ve borrowed a family member’s SUV to pick up furniture that won’t fit in your compact car. But, whether you loan your car or are borrowing someone else's, some interesting questions arise.
Have you ever thought about whose insurance would be responsible if you got in an accident while borrowing a car? What if there were additional property damages? What if a friend borrowed your car and it was stolen while in their possession?
Does your car insurance coverage cover you in these situations? Did you check with your insurer before loaning or borrowing?
You might be surprised to learn that in most states, auto insurance follows the car and not the driver. In other words, if your friend borrows your car and crashes it, your insurance will kick in to cover the damage, not theirs. Before borrowing a car or lending it out, it’s important to understand the ramifications of what could happen to your (and your friend’s) insurance in case an accident occurs.
Usually, car insurance claims for accidents that arise from the use of your car will go through your insurance when:
What if your insurance maximums won’t cover the extent of the damage to the vehicles or the entirety of the medical bills? For example, let’s say your friend causes an accident that results in $15,000 worth of damage to the other driver’s car, but your policy limit is $10,000.
Your friend’s insurance should pick up the remaining $5,000. Think of your insurance as the primary coverage, and your friend’s insurance as secondary coverage if your coverage limits are maxed out when the repairs and medical bills exceed your maximum coverage.
Although the costs associated with an accident may be covered by both insurers, filing a claim will inevitably cause your rates to go up when it’s time to renew. Your insurance premium could go up substantially if your friend has been borrowing your car on a regular basis and your insurance company wasn’t aware of this arrangement. They might even cancel your policy.
There are other potentially serious claim issues that could arise depending on the circumstances of the incident. Let’s say your friend was under the influence or texting someone when they caused an accident in your car. Or, what if you lend a car to a family member who has numerous tickets and traffic violations. Your insurance might deny these claims altogether, in which case you would be held liable for all medical bills and damages, not to mention potentially subject to a lawsuit.
If you live with family members or roommates who borrow your car regularly, it’s a good idea to include them on your policy. However, including additional drivers on your car insurance policy may result in a higher premium. A young roommate with a poor driving record might cause it to go up. Adding an older family member with a solid driving record could lower it.
There are currently 8 states where insurers can reduce coverage limits for anyone who’s not specifically listed on your policy. These states include California, Colorado, Michigan, Missouri, Ohio, Oklahoma, Pennsylvania, and Washington. What this means is that the coverage could be reduced to state minimums if you’ve purchased a high amount of liability coverage. To avoid this entirely, include any non-household members who borrow your car on your policy.
Medical payments coverage, uninsured/uninsured motorist coverage, and personal injury protection (PIP) requirements and how they apply to claims can vary from one state to another. These state variations make it difficult to figure out fiscal responsibility when it comes to injuries caused by an accident.
For example, the requirements for PIP coverage vary from state to state. Some states require it, and some states allow drivers to decline it. Contact your auto insurance company to learn about your PIP and uninsured motorist coverage, and how it applies if someone borrows your car.
Depending on the situation, your car insurance may not kick in when your car has been borrowed and is involved in an accident. Before handing your car keys to anyone who’s not on your policy, it’s vital to ask your insurance company about any exclusions, exceptions, or limitations to your policy with regards to car lending. These exceptions include:
If your friend gets a ticket for speeding, it’ll go on their record and won’t affect your insurance policy. However, violations picked up by red-light and traffic cameras are the responsibility of the vehicle’s owner.
If you have comprehensive coverage and gave your friend permission to borrow your car, your comprehensive coverage should pay in the event of theft.
What about an accident your friend was involved in, but it was determined that it was not their fault? If the other driver (not your friend) is at fault, then their insurance would kick in to cover the damage.
Make an informed choice.
Before you decide to loan your car out to a friend, be sure to ask about their insurance coverage and whether they’d be willing to help pay for any damage if they cause an accident in your car.
Make sure they’re licensed and insured and ask about their driving history. Numerous accidents and tickets are red flags that it’s best to let your friend find another solution. Still in doubt? Then contact your insurance company and get the facts.
This article has been reviewed by licensed insurance industry expert Moshe Fishman on October 8, 2024.
The Better Business Bureau (BBB) has always been a reliable resource for evaluating the trustworthiness of businesses. When shopping for a new car or hiring a plumber, checking with the BBB can provide an extra layer of confidence that the company you’re about to do business with is dependable.
But just how trustworthy is the BBB’s accreditation system? Learning how the BBB evaluates businesses and understanding BBB accreditation standards can help consumers determine its merits and limitations.
Established in 1912, the BBB is a nonprofit organization with chapters throughout the US, Canada, and Mexico. According to the bureau’s mission statement, its goal is to “be the leader in advancing marketplace trust” by “setting standards for marketplace trust, encouraging and supporting best practices by engaging with and educating consumers and businesses, and calling out and addressing substandard marketplace behavior.”
The BBB aims to fulfill its mission statement in two ways: by rating businesses based on their reliability and performance and by acting as a facilitator for the resolution of consumer complaints.
The Better Business Bureau lists more than five million businesses on the BBB website. To qualify for BBB accreditation, a business must strive to meet eight specific standards. These standards include:
Each business is assigned a rating or “grade,” ranging from A+ to F. A company’s grade is based on how they score on thirteen specific factors with a total possible score of 100. These factors are related to both factual information and consumer feedback such as:
Businesses with BBB accreditation have completed a number of steps and been successfully evaluated by the BBB. They’ve applied for BBB accreditation and submitted records about their business including a copy of their business license and paid the BBB’s accreditation fee.
The BBB reviews these documents along with public records to determine the trustworthiness and reliability of the business. Then the letter grade is assigned to the business. According to the BBB website, specific customer reviews aren’t used when calculating a business’s score.
A business must score at least a “B” rating to earn BBB accreditation. It must also maintain its grade to keep its accreditation. Businesses that have been accredited are able to display the “BBB Accredited” logo on their properties and websites. According to the BBB website, 85% of customers feel confident about doing business with a company that has earned BBB accreditation. It is likely to have a positive influence on potential customers.
Each BBB chapter has a fee structure for businesses in that area. The fee each business pays is dependent on several factors including the number of company employees and locations. Fees range from hundreds to thousands of dollars based on these factors.
Consumers can find information on businesses that are accredited and non-accredited on the BBB website. Companies can choose to become accredited which requires that they pay accreditation fees and apply for accreditation. The accredited status is displayed prominently for businesses that have attained accredited status on the BBB website.
Revenue largely comes from accredited businesses through the accreditation fees. Using accreditation in ads by member organizations, for example, incurs a charge by the bureau. If you are a nonaccredited business you can respond to a complaint on a voluntary basis, which will improve your BBB rating.
The BBB is well known for its ability to act as a facilitator for disputes between consumers and businesses. Businesses that have earned accreditation must respond to consumer complaints in a timely manner to maintain their accreditation. Once a consumer files a complaint, the business must submit a response within fourteen calendar days.
Should an initial request to the company not solicit a response, the BBB will then send a second notice. The BBB informs consumers when the business responds to the complaint or if the business hasn’t responded. Complaint outcomes will end up in one of five potential buckets: Answered, Unanswered, Resolved, Unresolved, or Not Pursuable.
Although the BBB recommends that consumers start by contacting the company directly for resolution, this isn’t a requirement. Complainants have a year to file a complaint from the initiating incident although extenuating circumstances may be considered. To file a complaint with the BBB, it must include the following information and meet certain criteria:
When writing up a complaint, it’s important for consumers to maintain a degree of courtesy and professionalism in their account of events. The BBB doesn’t tolerate abusive language in complaints. Although the situation is one you feel strongly about, it’s best to leave emotion out of it and convey the details matter-of-factly.
Because the BBB receives revenue from the businesses it grades, some have argued that this implies an inherent conflict of interest. However, the BBB maintains that accreditation and membership fees do not affect the rating that the BBB gives to a particular business.
Some critics and watchdog groups also claim that the BBB doesn’t monitor non-accredited businesses as closely as those that are accredited. According to the bureau’s website, the BBB “does not routinely check required competency licensing and government actions for businesses that do not seek BBB accreditation.”
A common complaint among consumers is that complaints can be closed and marked as resolved even when the consumer is dissatisfied with the company's response. If the BBB determines that the company has made reasonable resolution efforts, then the mediation process is closed, even if the consumer isn’t satisfied with the outcome.
The Bottom Line
Consumers have several options at their disposal when reviewing a business. Google, Yelp, and social media reviews can help a consumer determine the quality and trustworthiness of a business and its business practices. But despite this wide availability of sources, consumers still hold a lot of name-brand loyalty to the Better Business Bureau.
A Facebook review only goes so far when trying to root out unscrupulous or poorly rated businesses. For consumers, the best solution is to utilize a wide range of sources, especially when making large purchases or hiring for expensive jobs.
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This article has been reviewed by licensed insurance industry expert, Moshe Fishman on 9/27/2024.
If you’ve recently rented a car, you’ve undoubtedly seen the option to rent a car from a car-sharing service like Turo or Zipcar. Maybe you’ve already rented a car using one of these sites. For car owners who don’t use their cars often, renting your car on a car-sharing website can be an effortless way to make extra money.
Believe it or not, the idea of car sharing has been around for a while. Recently it has become more popular in part due to the pandemic and increasing demand for more flexible options when renting a car. Using a car-sharing service provides more convenience, flexibility, and accessibility than using traditional car rentals.
Car sharing is a type of rental car service where one vehicle is used by multiple people for multiple purposes. Called “peer-to-peer rentals,” these rentals between private parties are facilitated by third parties. Some popular car-sharing websites include Turo, Getaround, Zipcar, and JustShareIt although it’s estimated there are two dozen different car-sharing programs in the U.S.
The concept of car sharing is ideal for those who don’t own cars as well as for car owners who want to earn income from vehicles they don’t use often. For example, someone who telecommutes or who only needs to drive to the office a couple of times per week can earn money as they work remotely. Sharing your car becomes a side hustle to generate passive income.
Car sharing programs are different from ridesharing apps such as Uber and Lyft, as these provide rides in vehicles driven by car owners who are paid to pick up passengers. On the other hand, car sharing is renting your car out to a stranger who will drive the vehicle themselves. You may need to deliver the car to your renter, or they may pick up and drop off the car themselves.
You’re probably wondering, how much money could I make by renting my car out? Is the additional cash flow worth the potential risks and headaches? What kind of car insurance do I need to make sure I’m covered? Read on to discover the pros and cons of renting your car out through a car-sharing service.
Unfortunately, your personal auto insurance policy will not cover your car when you rent it out to third parties. This is because car insurance policies prohibit the use of personal vehicles for commercial use or profit.
The commercial use of your vehicle is different than letting a friend or family member borrow your car. Commercial use means making a profit through the use of your personal vehicle by using your car for delivery services, car-sharing programs, or other business uses. In essence, you have become a car rental company.
However, car-sharing services provide insurance that protects not only the owner, but the person renting your car, and everyone involved in the rental process. The insurance coverage offered by the car-sharing companies typically includes:
When signing up with a car-sharing service, car owners should take the time to read the fine print and be aware of the limitations of the insurance provided. For example, car-sharing companies can get out of paying claims by declaring a vehicle “not fit” if the owner hasn’t had the car properly serviced.
Prospective owners thinking of renting their cars out might not want to rely solely on the coverage provided by the car share company. Consider purchasing a commercial insurance policy to properly ensure that both you and your car will be protected in the event of theft, vandalism, or accidents.
Renting your car through a car-sharing company can be an easy way to generate income for those who don’t use their cars often. But car owners should do their due diligence before signing up to ensure they’ll be properly covered against loss.
This article has been reviewed by licensed insurance industry expert, Moshe Fishman on 9/10/2024.
With soaring gas prices and increasing talk of inflation, it is more important than ever to find ways to minimize car depreciation and retain the value of your car.
While ultimately unavoidable, there are many ways to retain your vehicle's value as much as possible. This article will provide some of the best ways to minimize a car's depreciation before and after buying a car.
Choose the make and model wisely
The make and model you choose play a key role. If you want to minimize the depreciation value of your car, it is wise to opt for a make and model that are known to retain value. As a rule of thumb, the top qualities you want to look for are:
It is helpful to research previous sales prices of earlier models of the car you are interested in purchasing. Doing this will help you forecast what a car may be worth in the future. You want to make an informed decision to help you purchase a vehicle with the best chances of retaining its value.
A great place to start is the Kelley Blue Book. You can find out what a car is currently worth and what it has sold for in the past. Additionally, you can research how much similar models have sold for to get an idea of what to expect in terms of depreciation.
Standard and popular colors have a better chance of retaining value. These include colors such as white, black, gray, and silver. Conversely, choosing bold and less common colors will likely reduce the car's value.
Considering the car's manufacturer warranty can also help minimize your car's potential for depreciation.
When buying a car, the best-case scenario is to buy a make and model that offers a warranty that will transfer to the new owner when sold (known as a transferrable warranty).
The depreciation of a vehicle's value has less impact when bought used. A brand new car will decrease in value by 10-20 percent the moment it is driven off of the lot.
A used car, on the other hand, will have already undergone its most significant initial depreciation. Therefore, you can avoid a considerable loss in value by opting for a used vehicle instead of a new one. If you are currently in the market for a car, this is a significant point to consider to get the most value for your money.
Another option to minimize the depreciation of a car's value is to opt into leasing one. The price of an auto lease includes the amount of depreciation, and if the resale value is higher than the buyout price by the time your lease is up, you will likely save a significant amount of money by getting a great deal.
If you have already purchased a car and are interested in finding out how to reduce car depreciation, there are still steps you can take to retain your car's value as much as possible.
It is important to keep your car in good condition if you want to minimize its rate of depreciation. This means regularly washing and waxing the exterior, as well as cleaning and vacuuming the interior. You should also get any dents, scratches, or other damage repaired as soon as possible.
Additionally, you should keep up with all of the car's scheduled maintenance. This includes things like oil changes, tune-ups, and tire rotations. Keeping your car well-maintained will help it retain its value better than if it was not taken care of.
Driving safely will help keep your car in good condition by minimizing the risk of getting involved in an accident. Accidents can cause extensive damage to your car, which will lead to a decrease in its value.
Modifying your car can actually decrease its value. This is because modifications can make it more difficult to sell the car, as not all potential buyers will be interested in them. Additionally, some modifications may void the car's warranty.
If you do choose to modify your car, be sure to do research beforehand. This way, you can avoid making changes that will decrease its value.
One of the main factors that determines a car's value is the number of miles it has been driven. The more miles a car has, the less it is worth. This is because cars that have been driven more tend to have more wear and tear, and will likely need more repairs.
There are two critical elements to consider when you decide to sell your car: timing and the buyer.
Many car owners make the mistake of not taking into consideration when they are selling their car and how it might impact its value. The conditions and circumstances of the auto market when you plan on selling your car may affect the resale value of your vehicle.
For example, selling your gas-guzzling SUV during a hike in gas prices likely won't get you as much money as if you were to sell it when gas prices are stable.
Certain types of cars also sell better during different times of the year; it is a bad idea to sell a convertible in the winter. Consider the kind of car you are selling and research the demand.
Selling your car to an independent buyer rather than to a dealership is your best bet for receiving the most money for your vehicle. While using a dealership as a middle man is often the quickest way to get your car sold, such convenience comes at a price.
When you sell your car to a dealership, they will typically offer you less money than what the car is actually worth. This is because the dealership needs to make a profit when they resell your car.
Knowing how to reduce car depreciation can go a long way in protecting your auto investment. Whether you currently own a car, are in the market for a vehicle, or are planning on selling a car, there are specific actions you can take to secure the value of your investment.
If you already own a car and have no plans to sell it soon, car depreciation is nothing to lose sleep over. Car depreciation is unavoidable, but following the suggestions in this article can mitigate its severity and ensure that you get the most money for your vehicle if you decide to sell it in the future.
This article has been reviewed by licensed insurance industry expert, Moshe Fishman on 9/9/2024.
It's no secret that car accidents are a leading cause of death in the United States. However, what may come as a surprise is that many of these fatalities could be prevented by installing a safe driving monitoring program in your vehicle. Safe driving programs work by tracking your driving habits and providing feedback to help you become a safer driver. This article will discuss how they work and why you should consider using one.
Safe driving monitoring trackers are devices that attach to your car and monitor your driving habits. They track things like how often you brake, how fast you drive, and how often you take corners. The data is then analyzed to create a driving score.
This score is used to identify areas where you need to improve and provides feedback on how to do so. Insurance companies use these trackers to reward safe drivers with lower premiums. Employers can also monitor employees who use company cars or parents who allow their children to borrow the family car. Parents can make sure their children are using good driving habits, and they can see areas where there’s improvement needed.
Most safe driving monitoring programs work by communicating with a smartphone app. The app collects data from the tracker and sends it to the program's server. A software program that creates a driving score analyzes the data collected by a safe driving monitoring tracker. This score is based on the following factors:
This data is then used to create a driving profile for you. This profile will show your strengths and weaknesses as a driver. For example, if you often brake too soon, the program will provide feedback on how to brake later. Conversely, if you drive too fast, the program will provide feedback on going slower.
There are several reasons you should consider using a safe driving monitoring tracker. Some of the benefits include:
Insurance companies use data from safe driving monitoring trackers to reward safe drivers with lower premiums. They do this by creating a driving profile for each driver. This profile shows your driving habits and the risk you pose to the insurance company. As a result, you will likely qualify for a lower premium if you have a good driving score.
Parents can use safe driving monitoring programs to monitor their children's driving habits. It allows parents to teach their children how to drive safely and gives them peace of mind knowing that their children are driving safely. It can also monitor when and where a teenager is driving.
Safe driving monitoring programs help promote road safety by teaching drivers how to drive more safely. It reduces the number of car accidents and fatalities on the road. In addition, these programs can provide feedback on driving habits that may lead to an accident so that drivers can learn to avoid those behaviors in the future.
Insurance companies can use safe driving monitoring programs to improve their safety statistics. This data can help them identify dangerous intersections and develop new safety programs. In addition, individuals can use these statistics to make informed decisions about their driving habits and where they choose to drive.
Most insurance companies do not require safe driving monitors. However, more and more insurance companies are starting to offer discounts to drivers who use them. As a result, it is becoming more and more common for drivers to use safe driving monitors.
In addition, more and more drivers are using safe driving monitors to prove their driving skills to insurance companies. Therefore, if you are looking to reduce your car insurance, you should consider using a safe driving monitor.
However, if you opt-in for usage-based insurance (UBI), your insurance company may require you to use a safe driving monitoring tracker. UBI is a type of car insurance where your premium price is based on how well and how often you drive. If you opt for this type of insurance, you will likely be required to use a safe driving monitor.
In addition to reducing your car insurance and monitoring your children's driving habits, there are several other benefits to using a safe driving monitor. Some of these benefits include:
These benefits help improve your driving skills and make you a safer driver. As a result, using a safe driving monitor can save you money and keep you and your loved ones safe on the road.
Many safe driving monitoring programs are available on the market if you don't want to get one through your insurance company. It is crucial to choose one that fits your needs. Some of the factors you should consider include:
It is also essential to read reviews of different safe driving monitoring programs before choosing one. This will help you find a program that fits your needs and budget.
Safe driving monitoring programs are becoming more and more common. They offer several benefits, including better car insurance premiums, parental controls, and road safety.
Insurance companies are starting to offer discounts to drivers who use these monitors, so it is becoming increasingly common for drivers to use them. If you are looking for a way to reduce your car insurance, you should consider using a safe driving monitor.
