There’s a real problem with the increasing level of fraud. When you add up the estimates for each state it comes to so many billions, it brings tears to the eyes. Who would have thought we had become so dishonest as a nation. If only we could bring the same level of commitment to reducing the deficit, the Tea Party could retire feeling there was a job well done. As it is, some states have become fraud magnets. The majority of these unlucky states run a no-fault system.

Put simply, a system designed to enable people to recover their losses with fewer administrative and legal problems is ripe for the plucking. It’s somewhat ironic to applaud the role of attorneys but, in this instance, their job is demand satisfactory evidence to support a claim. If the claimant has no good evidence, the claim is dismissed. In no-fault states, the insurance companies have no incentive to challenge every claimant to produce credible evidence. There’s an administrative routine and so long as the paperwork matches the requirements, payment is authorized. The result, of course, is scam artists queuing up for payment and all the bills being passed on to the policyholders. Yes, that’s right. We all get to pay higher premium rates to cover the cost of the fraud while the insurance companies continue to be highly profitable.

Florida not only attracts the snow birds, it’s also become the fraud capital of our nation. Even though the number of accidents has been falling steadily over the last five years, the estimated cost of fraud is now estimated as almost $2.5 billion a year. Equally predictable is the cycle of the lawmakers’ proposals to solve the problem. At the beginning of each year, someone proposes a new bill. Over the year, there are debates as all sides pitch in with their thoughts. At the end of the year, it fails to get a majority and we wait for the new year. This January sees the latest idea. The key problem is seen to be the role of clinics, many of which are fronts for fraud. If the insurers cannot be persuaded to insist on independent medical reports on every claim for personal injuries, the law should be changed to require every alleged victim of a traffic accident to report to an ER for a medical evaluation. If no doctor certifies the alleged injuries as real, the insurers will be barred from paying out.

This is a bold suggestion. At present, some doctors in clinics take a percentage of the claims to certify injury. Who is to say there will not be ER doctors prepared to do the same? More importantly, ERs in Florida already have too many people turning up for treatment. The number with health insurance means there’s a steady tide of people coming into ERs as emergencies. If the government requires thousands of drivers and passenger who might have injuries to join the queues, some would be there for days before being seen. Although the theory says you get cheap auto insurance if you reduce fraud, the result in this case would be higher medical bills as hospitals build larger ERs and hire extra doctors. For car insurance quotes to fall, we need effective policing, i.e. the state spending money on law enforcement.

Suprisingly enough credit rating is used by a greater part of insurance companies as a factor when calculating rates. And while this may seem as lacking any logic from the customer’s point of view the insurance companies have a perfect explanation to using your credit score when determining your rates. Moreover, they aren’t breaking the law in any way by using your credit information without your consent and knowledge. Let’s learn how is that possible and what consequences your credit score may have with respect to insurance.

Insurance companies access your personal information legally and they check insurance record as well. So don’t haste filing a court case since its perfectly legal for insurers to do so. As for the purpose of doing so the insurance companies sure have one even if you may think otherwise. But you will have to start thinking as an insurer in order to grasp the importance of credit score from this perspective.

Insurers must assess the risk of covering everyone opting for a policy. If the risk is low then they can offer lower auto insurance rates as to reward the low probability of a claim from such a client. If the risk is high then they will charge higher rates as to cope with the costs involved with a higher probability of a claim. And the insurers will use any piece of information that will help them evaluate their risks no matter how strange it may sound for consumers. Statistically people with lower credit scores file more insurance claims whereas customers with higher scores file less claims than the average. So it’s logic that the insurance companies will adjust their rates according to this observation and use customers’ credit scores. But what if you’re not satisfied with how your score may affect your rates?

One possible method is to try improving your credit rating by reviewing your report and eliminating any unused credit lines and debts if possible. It will certainly take more time but you will get a profound effect besides cheaper auto insurance. The second option is finding a company that doesn’t use credit scores when calculating their rates. Though the majority of insurers do, there are still plenty of company that don’t, so you would want to stick to those providers.

The main problem for insurance companies is the large numbers of people buying their policies. It’s administratively impossible to visit every home before deciding whether to insure it. All insurers can do is rely on what the home owners tell them. But laws can often interfere. If your insurance provider can show you have failed to disclose something they assumed to be a risk, it has the right to cancel the policy. You can recover the premium installments you have paid in many cases certainly, but this is little consolation if your claim is denied…

What to disclose if you keep a pet?

Sharing your home with some animals is actually a minefield. If you keep a Rottweiler to deter burglars, this can result in big liability claims both when the dog bites a visitor and, perhaps surprisingly, a burglar. And many insurerance companies have restrictions on breeds considered potentially dangerous. People may usually not claim if they knowingly take the risk of injury. Whether burglars can claim depends on your local laws of the particular state. So, if the owner actually warns a visitor not to go near the dog, the visitor cannot claim if he or she goes to pat it only to be bitten. Similarly, some burglars have been denied a claim when they ignored a big notice warning of dangerous guard dogs. But some states have dog-bite statutes that deny this defense to lawful visitors.

These examples should warn you to very clearly tell your insuree if you have an animal known to be fierce. Exotic pet laws also restrict the types of animal you can keep in the house. Most states will refuse a permit to anything dangerous or endangered. If you are breaking the law by keeping an endangered animal or a dangerous beast in your home, this could invalidate your homeowners insurance policy

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Trying to adopt a crocodile even in Flrida, can land you in serious legal trouble. Youв better not follow the richeans’ trend to stock the moat round your castle with piranha fish or keep rattlesnakes in the same draw as your jewelry. This isn’t worth the risk. Home insurance companies are very conservative when it comes to approving security measures. Alarm systems and lights are enough. If in doubt, make a full disclosure of what animals you apply for a next bunch of homeowners insurance quotes. That way you sleep better.