A method to the ‘Madness’: Hole-in-one insurance

While we were picking our brackets in the annual college basketball tournament known as "March Madness," insurers were busy with their own game of chance. It's called "hole-in-one insurance." Hole-in-one insurance is often behind the scenes on basketball courts, football fields and baseball diamonds -- in fact, virtually every sporting event ranging from golf to hockey. Here's an example. It's halftime during a basketball game. To keep fans and viewers entertained while the opposing teams are in the locker room, kids from the audience are escorted to the half-court line. Each has one chance to sink a basket and earn college tuition. What happens if one of these lucky kids does make the free throw? Management isn't going to pay and neither is the university. Instead, the cost of this unlikely win will be paid for by the "hole-in-one" insurance company. Insurance madness Most major insurers, such as AIG, Lloyd's and even Warren Buffett's Berkshire Hathaway, are involved in this sports-betting business. But, unlike us, they bet these kids wouldn't make the basket, because if they do then the insurance policies have to pay. Or, in the case of Warren Buffett himself, out of his own pocket in his recent… (continue reading......)

Car insurers should stop discriminating against seniors

Last year my car insurance company raised my rate -- and for no apparent reason. When I called my insurer the woman who answered the phone pointed out a small number on the bottom of my policy. "You turned 66," she said smugly. "We charge higher rates for seniors. You people have more accidents." I accepted her version of the truth … then. But over the last year it's become apparent that my insurance company needs to consult with the Insurance Institute for Highway Safety (IIHS) and stop gouging seniors based on junk science and phony statistics. An IIHS study shows that between 1997 and 2012, fatal crash rates for older drivers fell 42 percent vs. just 30 percent for middle-aged ones, who are considered among the safest. Those aged 18 to 25 are deemed to be the least safe drivers. Myths about senior drivers If older drivers are having fewer accidents insurers would say it's because we tend to leave our old Buicks in the garage most of the time. Remember that infamous phrase the used car salesman said right before you bought that second-hand car: "Only driven to church on Sunday by an old lady." It turns out… (continue reading......)

Can flood insurance wipe out real estate values? For shore!

It's a rarity that both political parties in Washington, D.C., will agree on anything. But a bill sponsored by New Jersey Sen. Robert Menendez to delay the current confiscatory rise in flood insurance premiums sailed through the U.S. Senate in late January by better than a two-to-one margin. The issue is simple. If you quadruple the amount homeowners pay for flood insurance right now, it will force these residents to abandon their homes, particularly in areas such as the Jersey shore, where people like me are still dealing with the effects of Hurricane Sandy. Housing values would plummet and lead to another real estate recession in coastal and low-lying areas around the country where we are still recovering from the one in 2008. Not only do Democrats like Menendez and Louisiana Sen. Mary Landrieu believe this, so do coastal state Republicans. Florida 'Flipper' But the bill's passage in the House of Representatives is not assured. Those with vested interests will try anything to defeat it. Conservative think tanks are trying to bolster resistance in the House by saying there's no problem at the shore and claiming that housing values are going up. As proof they offer news articles showing a… (continue reading......)

When in doubt, don't go out -- even if you're covered by auto insurance

In hindsight, I could be called smart ... or overly cautious. You decide. I was looking forward to a friend's annual holiday party one Saturday night in December, but knew I had to drive almost 50 miles to get there. About midday it started to snow and kept on snowing until early evening. By then I had already cancelled. The reminder of having almost been run down a few years ago while changing a flat tire in the snow had made me wary of the white stuff. Then, just as suddenly as it started, the snow stopped. The plows came out and the roads were clear to the blacktop. Mr. Right Being the Type A personality that I am, I started to regret not having gone to the party. I berated myself the whole night -- well, maybe not the whole night -- but awoke to find that perhaps I was right all along. Although the snow had stopped, the cold had iced over the roads later that evening. And, as I soon found out from watching the news, a car carrying a local couple skidded under an oncoming train. The husband died and the wife wound up in critical… (continue reading......)

Copyright © 1996-2013 The Fine Print - Presented by Insure.com. All rights reserved.