Monthly Archives: July 2024

Explaining Rental Car Coverage in Auto Insurance Policies

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Rental car coverage in auto insurance policies is a crucial feature that offers financial protection and convenience when your vehicle is unavailable due to an accident, theft, or other covered incidents. Understanding how this coverage functions can help you evade unexpected expenses and maintain mobility around Bloomfield, NJ.

What Exactly Is Rental Car Coverage?

Rental car coverage, also known as rental reimbursement coverage, pays for the rental of a vehicle while your car is being repaired following a covered incident. This coverage is separate and optional. It generally covers the daily rental rate up to a specified limit, ensuring you have a temporary replacement vehicle without having to shoulder the full rental cost yourself.

How Does It Function?

When your car is involved in an accident or stolen, and the incident is covered under your comprehensive or collision insurance, rental car coverage comes into effect. Your insurance company will reimburse you for the rental car expenses up to your policy’s daily and total limits. For instance, your policy might cover up to $30 per day with a maximum limit of $900. It’s important to note that rental car coverage only applies when a claim is made on your vehicle, and repairs are required.

Benefits of Rental Car Coverage

The primary benefit of rental car coverage is the convenience it provides. Not having a vehicle can significantly disrupt your daily routine, affecting your ability to commute to work, run errands, or manage other essential activities. Rental car coverage ensures you have a temporary vehicle, reducing the stress and inconvenience of being without your car.

E.S.T.I.R. Inc. Is Here for You

E.S.T.I.R. Inc. is ready to assist when you need insurance information. Our services are available in Bloomfield, NJ, and surrounding areas. Give us a call today.

Why You Need Home Insurance When You Take Out a Mortgage

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Owning a home is a dream come true for many people. However, home ownership comes with a slew of responsibilities. One of those responsibilities is obtaining a home insurance plan if you take out a mortgage. We will delve into why that’s necessary. If you’re searching for an insurance agent serving Bloomfield, NJ, and other nearby communities, consider contacting E.S.T.I.R. Inc.

Why Lenders Require Home Insurance

Mortgages are asset-backed loans, which means that an asset is utilized as collateral to secure the loan. In the context of a mortgage, the home purchased with the loan is often used as collateral. Consequently, if homeowners default on their mortgage payments, the bank can seize and sell the home to recoup the money they’re owed.

While the bank doesn’t own the mortgaged home, it has a financial interest. All other factors being equal, the more valuable the property, the lower the bank’s risks. If a house is damaged, perhaps by a storm, its value decreases. This implies that the bank’s risks would be amplified if everything else remains constant. Banks typically mandate that homes bought with a mortgage have home insurance to minimize risks.

In addition, if a home is severely damaged or destroyed and its worth diminishes substantially below the mortgage, the homeowner may cease making payments. This would leave the bank accountable for the mortgage, and when they sell the property, they may not recover the full amount lent. In essence, mortgages and home insurance make lending less risky and thus less expensive for borrowers.

If you need assistance with home insurance policies in Bloomfield, NJ, or other communities, consider contacting E.S.T.I.R. Inc.