There are some catastrophes that would simply be impossible to bear alone. From house fires to weather damage to car crashes, these tragedies can cause financial and physical difficulties that can dramatically impact a person’s life. That’s where insurance steps in.
Insurance is a social mechanism designed to give people peace of mind in the face of risk and spread the burden of an individual’s catastrophic loss across a group of people. Without it, victims of disasters and accidents are often left struggling to pick up the pieces and start over. However, with insurance, we can work together to help our neighbors bounce back after a catastrophe and return to their daily lives. Then, if the day comes when we find ourselves facing a disaster, we too have the help and resources available to get our lives back to normal.
Our goal at Pioneer State Mutual Insurance is to make a difference across Michigan by preventing individuals from needing to carry the weight of a tragedy alone. That’s why we focus on offering an array of coverage options, giving you the assurance you need that if disaster does strike, we’ll be here to help. Pioneer's products are sold through Independent Insurance Agents across the state. Visit our Agency Locator map for one near you.
How is my Insurance Rate determined?
- There are many factors that determine an insurance rate; the following is a list of some of them:
NOTE: Pioneer State Mutual believes the most accurate way to determine your rate is to speak with an Independent Insurance Agent. He/She will be able to calculate your coverage needs, most suitable deductible(s), and find discounts that may apply to your situation.
- Auto: Your age, your location, the number of drivers in your household and their ages, traffic tickets, at-fault accidents, not-at-fault accidents, the number of claims you have filed (even with previous carriers), any additional endorsements you add, your insurance score, and any discounts for which you may be eligible are a few of the factors considered when calculating your auto premium.
- Homeowners: The “dwelling value” of your home (which is called “Coverage A”), your home’s contents, your location, how close you are to a fire department and/or fire hydrant, any additional endorsements you add, your insurance score, the number of claims you have filed (even with previous carriers), and any discounts for which you may be eligible are some of the factors considered when calculating your homeowners premium.
What is an Insurance Score?
- Most insurance companies use a type of insurance score model. TransUnion is the company that supplies Pioneer State Mutual with insurance scores for potential policyholders. Most insurance scores are comprised of a person’s credit information, including but not limited to the following reports: how often an applicant has applied for credit, the amount of credit available, whether he/she has ever had a debt submitted to collections, current credit balances, and late payment history. The insurance score is one of many factors used in determining a policyholder’s premium.
What is a deductible?
- A deductible is the out of pocket money you pay before the company begins paying for a claim/loss. Deductibles can vary by coverage or policy. To help select your specific deductible(s), we recommend you contact an Independent Insurance Agent.
Can having a higher deductible make my payment more affordable?
- Yes, Insurance companies typically offer savings for those who choose higher deductibles. Therefore, you would pay more out of pocket before your insurance coverage would begin at claim time, but you would save more money on your premium.
What do I risk if I don’t accurately disclose my information to my Independent Insurance Agent?
(ex: if I am not honest about the number of drivers in my household , not disclosing traffic tickets, not reporting my home based business & etc.)?
- Misrepresentation on an insurance application can potentially cause your claim to be denied and/or your policy to be canceled. So, it is extremely important to be completely honest and accurately disclose all information.
How long is my policy in-force?
- Auto: Most companies offer a choice between a six-month and twelve-month auto policy.
- Homeowners: The average Homeowners policy is in-force for one year.
How do I check what insurance coverages I currently have?
- There are two ways to check what coverage(s) you currently have on your policy. One way is to look at your Insurance Declaration (DEC). This is provided to you at the beginning and each renewal of your policy. The second way is to speak with your Independent Insurance Agent. He/She can explain what is covered in your policy.
What is the Paid Loss Surcharge, and how could this impact the cost of my premium?
- Insurance is designed to cover one’s property in a catastrophic, unforeseen loss. On average, most policyholders either don’t submit any claims or only submit weather or glass claims over a three year period. However, the remaining claims are substantial enough to potentially cause everyone’s premium to rise. In order to prevent this, the vast majority of insurance companies have a “Paid Loss Surcharge” that is designed to isolate the rising cost of non-weather or glass related claims. Under this program, a policyholder’s first claim is not surcharged, but any subsequent claim(s) may cause the homeowner’s premium to rise significantly.
What is the difference between Market Value and Replacement Cost?
- Simply stated, Market Value is the amount you could sell your home for and Replacement Cost is the cost to rebuild it. Each company handles Homeowners Market Value verses Replacement Cost slightly differently, but the following is an example of how the terms are generally used:
- Replacement Cost: A fire destroys a home. The Replacement Cost would be the dollar amount the insurance company would pay to rebuild the home as it was before the fire, up to the limit specified on the insurance policy (Coverage A).
- Market Value: When you apply for a Market Value homeowners insurance policy, the insurance company uses real estate tools to determine the real-estate/selling value of your home in order to set the dwelling limit of the policy (Coverage A). So, in this example, the policyholder would receive the previously determined Market Value as the policy limit for the claim.
Will my Homeowners policy cover my home if I am not currently living in it (ex: it is for sale, I’m away on a long-term vacation or I’m renting it to another person/family)?
- No. In order for your Homeowners policy coverage to apply, you must be living in the home.
Should your home become vacant (ex: it is for sale, you are away on a long-term vacation or you rent it to another person/family), it is important that you immediately notify your Independent Insurance Agent. He/She will help you determine the best policy for the current use of your home. Failure to notify your agent or Pioneer State Mutual that you are not currently occupying your home will jeopardize your coverage for this property should a loss occur.
For more details on the provisions, conditions, coverages and exclusions of your Homeowners policy as it relates to your occupancy, please refer to your Pioneer State Mutual Homeowners Policy or contact your Independent Insurance Agent.
Can I get insurance coverage for my home electronics, mechanical equipment and major appliances?
- Yes, Many insurance companies offer an endorsement that covers home electronics, mechanical equipment and major appliances. For example, Pioneer State Mutual policyholders can add the “Equipment Breakdown Endorsement” to their homeowners policy. With this coverage, PSMIC will cover “sudden and accidental failure” for equipment such as air conditioning units, refrigerators, media electronics and outside yard maintenance machinery up to a specified limit. Please be reminded, normal wear and tear is not part of this coverage.
What is the “Backup of Sewers or Drains” endorsement? Do I need this if I already have Homeowners insurance?
The standard Homeowners Insurance policy excludes coverage for the backup of sewer/drain lines as well as the failure of a sump pump. So, companies like Pioneer State Mutual often offer a “Backup of Sewers or Drains” endorsement.
When sewers and/or drains back up, normally damage occurs in the basement, which houses the mechanical systems of the house such as washers and dryers, furnaces, hot water tanks and the numerous items people store there. Water or sewage usually destroys anything it comes in contact with. So, having this type of endorsement could prevent you from paying for the entire incident out of your own pocket.
Can I purchase Flood Insurance from Pioneer State Mutual?
What is Inland Marine? Should I have this coverage for any of my personal belongings?
The title “Inland Marine” can lead people to believe this coverage is just for boat owners. While boats may fall into this category, Inland Marine goes beyond boats to cover specific valuables such as jewelry, cameras, musical instruments, fine arts, computer systems and more.
The purpose of Inland Marine insurance is to provide coverage for specific items not covered in the basic property policy, allow broader coverage and/or to increase coverage limits for certain valuables.
How do I know what my jewelry would be replaced for if it was damaged or lost (Actual Cash Value vs. Replacement Cost)?
The amount you would receive for a jewelry claim depends on the true value of the jewelry (which is not always reflected accurately by the appraisal) and whether you plan to replace the covered item. The following is an example of the difference between “Replacement Cost” and “Actual Cash Value:”
- Replacement Cost: A necklace that you have scheduled on your insurance policy is stolen and you choose to replace that necklace with the same necklace. Under your insurance policy, you would likely receive the “replacement cost” of the necklace (the amount of money you would need to go to the jewelry store and buy the same necklace) up to the limit specified in your insurance policy.
- Actual Cash Value: If the scheduled necklace is stolen and you do not want to replace it but would just like the money from the insurance coverage, you will receive the “actual cash value.” This is the amount of money that particular necklace would currently be worth based on its age (depreciation), condition and what the current “going rate” for that necklace would be if it were being sold at the time of the claim.
I live in a Condo where the Association has insurance; do I need my own?
- Yes, While your condo or co-op association may cover the outside of your home and their property, they do not cover the inside property or contents. So, it is important to have your own insurance coverage for your personal belongings.
I’m renting and my roommate has insurance; do I need my own?
- Yes, you do need your own coverage. Your roommate’s insurance will only cover his/her own personal belongings. Likewise, the landlord’s insurance will only cover the building/structure and not your personal possessions. Renter’s insurance is very affordable and is highly recommended.
Does a college student need insurance for his/her belongings while away at college?
- If the student is a permanent resident of the insured home, is a full time student and has been at the student housing location at any time during the 45 days immediately before the loss, then he/she does not need insurance for the belongings. In this case, the belongings would be covered under the homeowners insurance where the student is a permanent resident (ex: his/her parent’s homeowners insurance would cover the belongings if the student lives with his/her parents when not at school).
Personal Auto FAQs
Do I have to buy auto insurance?
What is “No Fault Auto Insurance?”
In most states the at-fault drivers’ insurance company pays for every party’s injuries and/or physical damage stemming from the accident, but in Michigan each insurance company pays for their own policyholders’ injuries and/or physical damage.
Unlike all other states (where drivers can choose what coverage limit they would like), drivers in Michigan are required to carry unlimited, lifetime coverage.
For more information on No Fault Auto Insurance, view the Michigan Government Pamphlet here.
What is Personal Injury Protection (PIP)?
Personal Injury Protection (PIP) is the portion of Michigan’s No-Fault Auto Law that pays for the unlimited, lifetime medical expenses for those injured in an auto accident. This medical help can include covering doctor visits, paying a relative to provide care, daily transportation costs, wage compensation and more.
Drivers in Michigan can choose to “coordinate” their injury coverage with their health insurance. This means that if you have eligible health insurance coverage (that covers auto related injuries) you can ask for that insurance to be the “primary” insurance used if you are injured in a car crash. Coordinating your PIP insurance can save you money on your auto insurance premium.
For more information on PIP Coverage and Coordination, click this link for the official state government pamphlet.
What is the difference between Collision and Comprehensive coverage?
- Collision: This insurance covers your auto if it is involved in a collision (either your vehicle crashes into another vehicle/object or another vehicle/object hits your vehicle). It also includes roll-over accidents. However, many common incidents are excluded under this coverage such as hitting an animal, fire, theft/larceny, windstorm, hail, water/flood damage and vandalism.
- Comprehensive (also known as “Other Than Collision”): This covers all of the incidents excluded in the standard Collision insurance (such as hitting an animal, theft/larceny, hail & etc).