Question: What kind of insurance and limits are required for automobile insurance?

Answer: The North Carolina Financial Responsibility Laws require that Automobile Liability coverage be maintained. The minimum coverage requirements are $30,000 Bodily Injury for each person, $60,000 total Bodily Injury for all persons in and accident and $25,000 for Property Damage.

Question: How can an insurance company cancel the comprehensive and collision coverage on my policy if it is required by law?

Answer: Comprehensive and collision coverage is not required by law. If your vehicle is financed, your lien holder will require that you carry this type of coverage. Since this coverage is not mandated by law, the cancellation provisions of the policy apply. The cancellation provisions allow a company to cancel these coverages by giving 10 days advance notice.

Question: The insurance company is not offering me a fair price for my totaled vehicle. How does one establish the vehicle’s value?

Answer: Sources such as guide books and dealer quotes can be considered. If the value is disputed by either you or the insurer after using these resources, an accurate determination can be made with similar vehicles available in the market If you and the company still can not reach an agreement on the value of your vehicle, you may exercise the "appraisal" provision of your policy if you are dealing with your insurance carrier. If, however, you are working with the carrier that insures the other vehicle, your alternative may be through the court system.

Question: Must I use the repair facility that the insurance company recommends or suggests?

Answer: No. The owner of a damaged vehicle may use the repair facility of his/her choice. It must be noted though, that if your vehicle can be repaired for less than what your selected shop charges, you may be responsible for the additional amount.

Question: Can an insurance company use salvage parts or parts not made by the original manufacturer in estimating the amount of repairs?

Answer: Yes. A company does not have to put new original manufacturer parts on a used vehicle. Insurance regulations, however, do require that the use of after market parts be disclosed on the policy or the estimate.

Question: Does the automobile policy contain a grace period for paying the renewal premium?

Answer: No. There is no required grace period for the payment of a renewal premium. The policy actually expires at the end of the policy period, if premium is not received by that date.

HEALTH

Question: Why does my health insurance premium go up? I haven’t been sick or presented any claims to my insurance company.

Answer: Even though you have not presented any claims, others that are insured by the same type policy apparently have presented claims. Rates are directly affected by the claims experience of the group insured under a given plan or policy.

Question: I have a rider on my individual health policy. How long can the insurance company keep it on my policy?

Answer: The rider will remain in effect for the length of time specified in the terms of the rider. If there is no time limitation specified, it will remain in effect for the duration of the policy unless the insurance company agrees to remove it.

Question: If I change employers, can I expect to get continuation of my group coverage with a new employer?

Answer: New employees are generally eligible to be covered under their new employer’s group health plan. Pre-existing conditions limitations will not apply if there has not been a lapse of coverage of more than 63 days.

Question: What is a pre-existing condition and can it be excluded from my health coverage?

Answer: A pre-existing condition is any condition for which a person received treatment or was diagnosed within the preceding six months or for which any prudent person would have sought diagnosis and/or treatment.

Question: How can I dispute my HMO’s decision as to the necessity of my treatment?

Answer: HMO’s must provide appeal and grievance procedures so that decisions can be challenged. Your certificate booklet will provide detailed instruction on how to appeal or file a grievance.

HOMEOWNERS

Question: Can an insurance company not renew my homeowners insurance policy?

Answer: Yes. Since homeowners insurance is not required by North Carolina law, the cancellation provisions of the insurance policy contract govern. Those provisions allow a company to not renew a homeowners policy by giving the policyholder 30 days notice prior to the expiration date of the policy.

Question: Can credit history be used as a reason to not renew my homeowners policy?

Answer: Yes. North Carolina law does not prevent an insurer from doing so.

Question: My homeowners policy is not being renewed because of the frequency of claims. I've only had three small claims, all under $1,000. Can they do that?

Answer: Yes. While the dollar amount of a claim is usually irrelevant, each insurance company establishes its own underwriting guidelines. That is, the criteria it uses to determine when a homeowner is or becomes a greater risk than it wants to insure. Consequently, some underwriting guidelines may identify an amount, but most companies simply specify a number of claims within a given period of time. Each carrier's underwriting guidelines differ, so what one insurance company may not want to insure, another company may.

Question: If I am injured on someone else’s property, does the homeowners liability coverage cover the cost of my injuries?

Answer: Only if your injuries were caused by the negligence of the homeowner. If the homeowner is not negligent, then coverage is available only under the medical coverage provision of the policy. This would cover only necessary and reasonable medical expenses incurred up to a limited dollar amount. It would not cover payment for pain and suffering, lost income, etc.

Question: If the insurance company and I can not agree on the amount that it will take to repair my home, do I have to file suit?

Answer: No, your first step should be to utilize the appraisal provision of your policy. You will find it under "Section I— Conditions" of your policy contract.

LIFE

Question: What does "free look" mean?

Answer: You are allowed no less than 10 days from the date a life insurance policy is delivered, to review and evaluate the policy. A policy sold by mail order must provide for a 30-day review period. Should you elect to return the policy, the insurance company must refund to you any premium paid, including policy fees or charges.

Question: If I pay my life insurance premium and then decide to cancel my policy, will I receive a pro rata refund of my premium?

Answer: An insurer is not required under law to refund any portion of your premium if you choose to cancel your policy during the policy term.

Question: Can an insurance company void my policy if I made a mistake in completing the application?

Answer: A life insurance policy may be contested by the insurer during the first two years after its date of issue. If the insurer can prove a material misrepresentation was made in the application that would have affected the insurer’s decision to issue the policy, the carrier may void the policy.

Question: Does a life insurance policy contain a grace period for paying the premium?

Answer: Yes. A life insurance policy will provide for a 31 day grace period within which you can still make your premium payment. Your policy will remain in force during this time.

Question: Is an insurance company required to pay the death benefits if the insured commits suicide?

Answer: Generally, a life insurance policy will limit death benefits to the amount of premiums paid if the insured dies as a result of suicide during the first two policy years.