Transcription:

Matt: Hey guys, this is Matt Clendenin here and this week I'm doing a joint video blog with a good friend of mine. Tom Thi. Tom has taken care of my business and my family's insurance for years now. I trust him. So he's going to be here to answer some questions about insurance today.Tom, do you want to introduce yourself? 

Tom: Hey man, how's it going? I'm Tom Thi of Thi Menher and Associates. We are located in mission Valley here in San Diego, been in the business for 23 years as a insurance broker. So I'd definitely be glad to help you out and go through some of these coverages with you. 

Matt: So, Tom, I'm on the other side of things, I'm a trial lawyer, so I'm usually wrangling these claims after they've happened, but when it comes to insurance, what do you do for your clients? 

Tom: So what I do is I try to protect my client's assets. So what I do is I do an overall comprehensive look at their financial portfolio. So I look at their auto insurance policies, there are homeowners insurance policies, and determine if they need an umbrella to go along with that. And we ensure all of their miscellaneous as well, too. So rental properties, boats, toys and things of that sort. So I just try to make sure that they're covered properly and that one accident doesn't wipe out everything for them. Just to make sure that, yeah, they're, they're good to go and that there may whole again. 

Matt: All right. Well, I have my clients tell me, Oh, don't worry. I have good insurance. Or they say, yeah, I have full coverage. Sadly, once you really get into it, I find out a lot of times people don't really understand what the different coverages are and how it affects them. So I was going to ask, since I got you here, with your expertise, do you want to walk us through a basic auto policy in a deck page and kind of tell people. 

Tom: Yeah, for sure. Especially here in California, we're talking minimum limits in California. You're talking about $15,000 for bodily injury, $30,000 for Jackson and 5,000 for property damage. And that's all that's required to drive here in California. That's just the minimum limit snippet that's required. So with that, what that means is that the $15,000 for bodily injury, it pays off to somebody else. If you're the one who caused the accident up to a maximum $30,000 for any one accident that happens and $5,000 for the property, which is the vehicle that you might've hit or another building of some sort. 

Matt: Just to interrupt. When you say liability, you mean that those dollar limits are protecting the insured, the person who purchases them if they screw up? 

Tom: Correct. This is if you were the one who caused the accident, so this protects you because you're going have to pay out for these limits to somebody else. So yes you are correct. That is for the insured that's for us. 

Matt: So that, that doesn't sound like good news for my clients, because I don't represent the person who caused the crash. I represent the person who got hurt from the crash. 

Tom: Correct.

Matt: So you're telling me is that when one of my clients gets hurt, the minimum amount of money in California is $15,000. 

Tom: That's all that's required by law that you would need in order to drive. So that's, if somebody was carrying that and they hit one of your clients and that's all the insurance that they have, the insurance company will only pay out the $15,000. 

Matt: And I've actually heard even worse news. I read a 2015 study from the insurance Institute that says about 13 to 15% of all drivers on California roadways are completely uninsured. Meaning they're driving illegally with no insurance. 

Tom: Yeah. A lot of the time they don't realize that the policy has lapsed. Probably they missed a payment and it canceled out for a week or two weeks and they just forget to make a payment and the policy cancels out. Other people could do some clearing any insurance whatsoever. And then that's kinda where you get into trouble. 

Matt: I was going to say, so what happens if you're one of my clients and the person who hit you either doesn't have doesn't have any insurance or has a minimum policy of only $15,000. 

Tom: So what I would recommend to you and your clients is take a little bit higher policy limits. So in my firm, we will only write $100,000 for bodily injury, $300,000 for each accident and $100,000 for property damage. So those are my minimum limits in my office. We will not write anything less than those. The reason why we do that and the uninsured motorists portion of it is also $100,000 for bodily injury, $300,000 each accident, the uninsured motorists is the important key part of this is because that pays you out, that pays you as the driver. If somebody hits you and they don't have any insurance, your insurance company will pay you the one hundred thousand for any medical attention that you got. 

Matt: Well, what if I say, Hey, that sounds great. I want to have really, really, really high. UM in case someone hits me, but I only want to have the minimum to pay someone else if I caused the cash, are you allowed to do that? 

Tom: You are not, you can only match what you give out to somebody else. So if you only have the state minimum, $15,000/$30,000 of liability paying out to somebody else, the maximum that you can get back for yourself is $15,000/$30,000. So you can't go more than whatever you're paying out to somebody else. So that's the reason why I always match whatever I'm paying out to somebody else. I want the same thing coming back to me and my passengers in the vehicle. And so it's always going to be the one hundred thousand three hundred thousand at a minimum coming back to me. And there's a couple of other advantages to that too, is if the other person that hits you only has $15,000, your insurance company will cover the difference. So they'll pay you the $85,000 to make you whole again to get to that a hundred thousand.

Matt: Got it. Can you give folks, you know, cause I can hear my clients right now in the background saying, look, Tom, you know, we get it, you know, we should have a hundred thousand dollars of insurance at least, but you know that it's just too expensive. You know, can you give folks a sense of what's the cost difference of the Minimum policy, and what you're recommending, which is a hundred thousand dollars policy. 

Tom: Yeah. I mean, you're looking at a difference from a minimum 15/30 policy to a 100/300 policy, the difference of about $25 to $30 a month. So that's kind of what you're looking at. 

Matt: Hang on. So I just want to make sure I heard that. The difference to go from a really crappy insurance policy to a good one is 20 more bucks a month, 20 or 30 bucks a month.

Tom: Yeah. 25 to 30 bucks a month. Yup. And that's about it. It's 25-30 bucks a month just to make sure you're properly covered in California. 

Matt: What if I was really safe and I want to go to a really high policy. Is it a lot more expensive? 

Tom: No. I mean usually the maximum policy in California is about $500,000 for bodily injury, $500,000 each accident. And when you increase the limits from 100/300 to 500/500, you're talking to differences about a hundred dollars a year. 

Matt: So that's like eight bucks a month.

Tom: Yeah, about eight bucks a month. So yeah, that's what you're looking at is once you, once you get to those high limits the differences is minimum. 

Matt: Gosh. I mean, do you recommend those higher limits for a lot of folks?

Tom: I do. You know, I personally have the higher limits for myself and for the uninsured motorists. So I do have 500, 500 on my uninsured motors and my liability. Yes. I definitely would recommend that.

Matt: And I can personally say that because Tom's my insurance broker I also have 500/500. So I'm glad I'm spending eight extra bucks to get the really high coverage. 

Tom: The difference is A hundred dollars a year. But what I would definitely recommend though, is look at bundling packaging, your home with the auto that can sometimes saves you 15 to 20% on both policies. Look at increasing the deductibles to maybe something a little bit higher. There's occupational discounts and mileage that you drive on an annual basis. If you work from home or you rarely drive your vehicle, that can actually save you a lot of money as well, too. So there's different ways of cost cutting some of the premium and still maintaining those high limits. 

Matt: Well, Hey, I hope that was really helpful for folks. I think it was helpful. So the take home message from Tom is, make sure you have at least a hundred thousand dollars coverage on your policy and you have the UM to protect yourself. Definitely. I think I'll end with, I am always available to do a policy review. If you have any questions you can call me. Tom, can, can folks do the same for you for sure. 

Tom: Definitely, call my office at (619) 894-9057. And I can do reviews for all your policies. 

Matt: Great. Tom is amazing. I highly recommend him for any of your business or personal insurance. 

Tom: Thank you, Matt. Thank you so much. 

Matt: Okay. Take care.