Occasional Use Policy (vehicle)

[rezachi]

Hello,

My wife and I have 3 vehicles insured (1 daily driver for each and a convertible we drive in the summer). Both have clean records and are ages 25 and 24. In addition to what we have insured, I have an old truck (purchased for $200, if that tells you what kind of vehicle this is) that I keep around as a backup.

The only use this truck gets is if I need something moved that we wouldn't want to put in my wife's Ford Escape, or if I expect to be without my daily driver for a few days during the winter (in summer I'd use the convertible). We have not yet run into one of these situations, so the truck was driven ~25 miles over the past 3 years, most of which were trips around the block when I start it every few months to make sure it will start when I need it. Insurance is starting to get cheaper now that I'm leaving the "young male driver" classification, but it still seems way too expensive for something that gets used so little.

When I explained this case to my State Farm agent, he suggested that I get a normal car insurance policy, suspend it, and then reinstate it when I need the vehicle. This would work, except that I would have to wait until State Farm opens to put insurance on it if I need to use it or drive without insurance for a few hours. I have also noticed that their 6-month or yearly billing setup is less than ideal for this situation. For example, after reinstating the vehicle, I would receive a bill from State Farm for the 6 month premium and a check from State farm for "overpayment" within a few days. My agent could not offer any suggestions other than pay the bill and cash the check.

Does anyone know of a more cost effective and efficient way to keep coverage on the truck?

 

[benk622]

Are you asking to drop liability from the truck? I assume you don't have comp and collision since you bought the car for $200. Comp and collision would be the only coverage you could drop.

You cannot drop liability on a car you own without likely breaking the law in your state. You also can't have lower limits on that car vs other cars. If your state farm agent is doing this he is putting himself and you at serious risk. I would sooner lose a client than do anything close to that arrangement.

Keep liability at all times on your cars. You may be eligible for low mileage discounts since you don't drive it often.

 

[djs]

The answer probably lies in what state you are in.
Given the truck has virtually no real value, make sure you are carrying liability only on it.

If you are in a state that rates by mileage, make sure it is rated at the lowest tier.

You might have to shop outside of State Farm for your auto coverage.

Dan

 

[rezachi]

Thanks for the input guys.

No comp or collision, just 100/300/100 liability. There was a mileage rating on the policy, but the price was within a few dollars for the different classes.

While not something that the agents would likely advertise as an option, I assure you that the suspend/reinstate solution is legal. The vehicle is simply never used when the insurance is suspended (battery is removed and on trickle charger to keep ready). This is similar to what someone would do with a motorcycle during the winter months, except they allow me to do it on a day by day basis if I need to. Realistically, it sits suspended for about 6 months, goes on for a few days when corporate starts to complain about the suspension, and then gets suspended again. Only a few times in the past few years did I actually need to use the truck, but when I did having it was a great benefit.

I will try outside of state farm, I was wondering if anyone knew of a place that would fit my needs. The problems I would like to solve are:

-State farm likes you to work through your agent, who is typically not a 24-hour operation. This causes a problem if I need to change coverage state off hours.

- Their billing absolutely hates this setup (see first post)

 

[b61mack]

He gave you some bad advice, Problem, lets say it is sunday afternoon, you fill the back of the pu with leaves, to go down the street, to dump them. Insuranceman can't be found, Hey it is only down the street, You do it anyway, half a block a way, a kid on a bike pulls out in front of you^^^^^^. most accidents happen close to home.

 

[WinoBlues]

Thanks for the input guys.

No comp or collision, just 100/300/100 liability. There was a mileage rating on the policy, but the price was within a few dollars for the different classes. ................................................................

What is the cost to just keep the liability on it?

 

[Insurance-Guy]

Thanks for the input guys.

No comp or collision, just 100/300/100 liability. There was a mileage rating on the policy, but the price was within a few dollars for the different classes.

While not something that the agents would likely advertise as an option, I assure you that the suspend/reinstate solution is legal. The vehicle is simply never used when the insurance is suspended (battery is removed and on trickle charger to keep ready). This is similar to what someone would do with a motorcycle during the winter months, except they allow me to do it on a day by day basis if I need to. Realistically, it sits suspended for about 6 months, goes on for a few days when corporate starts to complain about the suspension, and then gets suspended again. Only a few times in the past few years did I actually need to use the truck, but when I did having it was a great benefit.

I will try outside of state farm, I was wondering if anyone knew of a place that would fit my needs. The problems I would like to solve are:

-State farm likes you to work through your agent, who is typically not a 24-hour operation. This causes a problem if I need to change coverage state off hours.

- Their billing absolutely hates this setup (see first post)

Your agent is a F---ing ***! If your state requires that you have liability insurance in order to have tags then what he is doing is canceling/suspending your insurance coverage! I have seen this done and met a guy that got a fine for over $1,000 for it. Here is the other thing to suspend coverage you would have to put at least comp coverage on it! Just makes no logical sense. Go to your states DMV website and look into insurance requirements, or call them and ask if what your agent is recommending is a good idea...or a better idea is call a Independent agent who can market your account with several carriers which in my area all will beat State Farm.

Best if Luck!
- - - - - - - - - - - - - - - - - -

Your agent is a F---ing ***! If your state requires that you have liability insurance in order to have tags then what he is doing is canceling/suspending your insurance coverage! I have seen this done and met a guy that got a fine for over $1,000 for it. Here is the other thing to suspend coverage you would have to put at least comp coverage on it! Just makes no logical sense. Go to your states DMV website and look into insurance requirements, or call them and ask if what your agent is recommending is a good idea...or a better idea is call a Independent agent who can market your account with several carriers which in my area all will beat State Farm.

Best if Luck!

Damn iPhone Best of Luck!

 

[rezachi]

He gave you some bad advice, Problem, lets say it is sunday afternoon, you fill the back of the pu with leaves, to go down the street, to dump them. Insuranceman can't be found, Hey it is only down the street, You do it anyway, half a block a way, a kid on a bike pulls out in front of you^^^^^^. most accidents happen close to home.

That right there is exactly the situation I want to avoid, hence the question. For something I am planning, it's no big deal to call ahead and have the insurance put on, but the that isn't always an option if I am in a jam and need a vehicle to drive. The cost of the policy is dropping now that I'm getting past the "young driver" age, I think it is now ~$150 for 6 months of just liability. I used to just leave it on year round, but my budget does not allow for that at this time, which is how I ended up asking my agent how I can save money on the truck.

This setup does not sound illegal. Per the wisconsin DOT site, it sounds like I just need proof of insurance if I am stopped or in an accident, not to register or keep plates on the vehicle.

I will definitely find an independent agent and see what they can do for me, since State Farm cannot provide a product that really fits my needs. Per-mile insurance would be awesome for this, but cannot be done according to my agent. Neither can the premium be refunded or credited forward if I submit proof that the vehicle was not driven.

 

[Insurance-Guy]

This setup does not sound illegal. Per the wisconsin DOT site, it sounds like I just need proof of insurance if I am stopped or in an accident, not to register or keep plates on the vehicle.
.

What you don't understand about suspending liability coverage is that it means you have suspended it it isn't in force. Your ID card is no good. Try to file a claim with suspended coverage.

We will suspend coverage if someone has turned the tags in or has a car that has broken down and they turn the tags in but have to or want to keep full coverage or just comprehensive coverage on the car. Say someone has a lien on a car and the engine blows. They are required to keep full coverage since the have a loan. But if they turn in the tags we could offer to suspend the liability for them...it's not for hey I want to drive this car today.