Consumer Tips

Auto

    • Insurance pricing is based on long-established actuarial principles, state regulations, risk factors, and real-world costs.  

    • Insurers use a number of rating factors including location and credit-based insurance scores to accurately predict risk.   

      • Local risk factors include traffic density, road conditions, or diver behavior.   

        • Also sees higher rates in areas of vehicle theft or vandalism.   

        • Some areas see higher rates that are prone to severe storms.   

        • Utilize zip codes to apply a fair risk-based pricing model.   

      • Credit-based scores predict claims.   

    • Maintain a good driving record and credit score. Avoiding crashes and traffic violations is one of the biggest factors influencing your premium. 

    • Shop around. Every company prices their products differently. Coverages differ between companies, and even within companies. 

    • Look for discounts. Many insurers offer discounts for things like low mileage, taking defensive driving courses, ensuring multiple vehicles, or having safety features on your car. 

    • Increase your deductible. A deductible is the amount you pay out of pocket before your insurance kicks in. This lowers your premium but increases the amount you will pay out of pocket if you have a claim. 

    • Consider bundling your home and auto insurance with one company. 

    • Pay your annual premium all at once. Many insurers charge a fee for dividing your premium into monthly payments. 

    • Consider a “pay-per-mile” insurance policy. If you work remotely or don’t drive often. You are charged a flat daily rate with a per-mile surcharge (typically a few cents per mile). 

    • Premiums rise because claims costs rise. The more insurers pay out in claims, the higher premiums must go.    

    • Insurance is a lagging indicator in the economy. The industry is still trying to catch up from enormous price increases due to inflation over the past several years.  

    • Vehicle repair costs have skyrocketed. Newer vehicles with advanced technology, lightweight materials, and expensive safety features cost significantly more to repair. 

    • Climate change. More severe storms mean more auto insurance claims. 

    • Lawsuit costs. Excessive or frivolous legal claims are often pursued by law firms seeking large settlements, even in cases where liability is unclear or exaggerated. 

    • Yes!  

      • As drivers get older, their rates may decrease.   

      • If driving infractions have fallen off your driving record, your rates may decrease.   

      • Driving safely for three years after an accident or other infraction may also help.  

      • Moving to a new location may cause auto insurance premiums to go up or down.  

      • Buying a new car may cause auto insurance premiums to increase or decrease.  

      • Participating in an insurer's app-based program to track driving habits may cause auto insurance premiums to increase or decrease.  

      • Drivers with poor credit (below 580) may pay about 69% more for car insurance than those with exceptional credit scores (800 or above).  

      • Don’t forget the rebates many policyholders received during covid… 

    • Vehicle repair costs have increased in recent years due to parts and labor.  

      • Parts  

        • Rising Costs of Parts. The cost of car parts, especially those with advanced technology or made from lighter materials, has been on the rise.  

        • Supply chain disruptions. Global supply chain issues can limit the availability and drive up the price of car parts.  

        • Advanced features. Modern vehicles often have complex features like automatic braking systems or lane departure warnings, requiring specialized and expensive replacement parts.  

        • Repair Techniques. Modern repair techniques often involve sophisticated tools and procedures. These can be more expensive than traditional methods.  

        • Safety Regulations. Stricter safety regulations can sometimes require the replacement of entire parts instead of repairs, further increasing costs.  

      • Labor  

        • Labor Costs. The cost of skilled labor for auto body repairs has increased.  

        • Technician Training. Mechanics working on modern cars with advanced features often require specialized training.  

        • Technician Shortage. There's also a shortage of qualified technicians in the auto repair industry, which can drive up wages. 

    • Break-ins surge as thieves target vehicles with bags, electronics, or gear visible inside. Prevention tips:  

      • Always lock your vehicle and take your keys.  

        • Many thefts happen when drivers leave their cars running or unlocked, even for a quick errand.  

      • Park in well-lit areas, and keep valuables out of sight — or better yet, out of the car.  

      • Install a visible deterrent like a steering wheel lock, or enable features such as vehicle tracking, alarm systems, or immobilizers if your car is equipped with them.   

      • Never leave your keys or key fob inside the vehicle, even in your garage.   

      • Don’t leave garage door openers in your car.  

        • A visible garage remote can give thieves easy access to your home, especially if your address is on documents inside the vehicle. 

    • Crashes are often caused by distracted or impaired driving, speeding, following too closely, fatigue, or not wearing a seat belt. Prevention tips:  

      • Get a pre-trip tune-up: check tires, fluids, brakes, and lights.   

      • Don’t drive drowsy: take turns or take breaks.  

      • Never get behind the wheel after drinking. Designate a sober driver or call for a safe ride home.  

      • Plan for weather, construction zones, and detours. Allow extra travel time to reach your destination. 

Home

    • Start by talking with an insurance agent and reviewing your coverage and consider raising your deductible.  

      • Take time to shop around.  While most insurance companies are experiencing the same losses and financial challenges, it pays to compare policy options and prices from different companies.  

      • Consider “bundling” your home and auto policies with the same insurer.  Many companies offer a discount if you buy both polices from them.  

      • Improve home security.  Many companies offer discounts for home security systems, doorbell cameras, or other ways to make your home safer.  

      • If you feel confused, contact the Insurance HelpLine.  The help line is a free service sponsored by IFM that offers non-biased answers to insurance questions. Dedicated, knowledgeable experts field questions on many types of insurance. 

    • Taking time to understand what coverage you do and do not have in your policy will benefit you down the road.  

      • Ask about gaps in your coverage and how to fill them.  

      • Ask about what other coverages may be available, including higher limits or “endorsements” to your policy that might cover specific items.  

      • Inform your agent about any significant changes to your property or its value so the policy limits can be adjusted.  

      • Discuss whether a higher or lower deductible may be right for you.  

        • A higher deductible will likely lower your homeowner’s insurance premium, though you will pay more out of pocket if you need to file a claim.  

      • Ask your agent about available discounts such as those for installing a security system, bundling your home and auto policies, or maintaining a claims-free record over time. 

    • Homeowner’s policy will include one of two types of coverage, or a combination of both. These determine how the insurance company calculates your payout when you file a claim: 

      • Actual Cash Value (ACV) 

        • Pays for depreciated value of your home or belongings at the time of the loss. Factors in age, wear and tear, and obsolescence, meaning you may not get enough to replace damaged items with brand-new ones. ACV means lower premiums, but you’ll receive less money for a claim. 

          • Example: Your 10-year-old roof gets damaged in a storm. A new roof costs $15,000, but due to depreciation, the insurer values your current roof at $6,000. 

          • CV policy payout = $6,000 minus deductible. 

          • You will need to pay the additional $9,000 out-of-pocket to replace the roof. 

      • Replacement Cost Coverage (RCC) 

        • Pays full cost to repair or replace your home or belongings without depreciation. RCC ensures you can buy new items or rebuild your home at today’s prices. RCC means higher premiums, but better financial protection. 

          • Example: Your 10-year-old roof is damaged. A new roof costs $15,000, and under RCC, the insurer pays the full amount (minus deductible). 

          • RCC policy payout = $15,000 minus deductible 

    • Take steps to prevent frozen pipes and safeguard your home during cold spells.  

      • Keep the heat on. Maintain an indoor temperature of at least 55°F, even if you are away from home.  

      • Let faucets drip. Allow cold and hot water to trickle from at least one faucet during extremely cold weather to keep water moving through the pipes.  

      • Open cabinet doors. Open cabinets under sinks in the kitchen and bathroom to let warm air circulate around plumbing, especially if they are located on an exterior wall.  

      • Insulate pipes. Use pipe insulation or heat tape to protect exposed pipes in unheated areas like basements, crawl spaces, attics, and garages.  

    • If you do experience damage caused by freezing pipes, take immediate action.   

      • Turn off the water. If a pipe bursts, turn off the main water supply immediately to minimize damage.  

      • Document the damage. Take photos of any damage before starting cleanup or repairs.  

      • Contact your agent or insurance company as soon as possible to begin the claims process. 

    • Don't rush to sign repair contracts.   

      • Do your homework, deal with reputable contractors and get references.  

      • Check the licensing status of any contractor with the Minnesota Department of Labor and Industry.  

    • Be wary of unlicensed, unauthorized, and potentially fake companies and individuals that try to sell you “package protection coverage” for lost, stolen, or damaged packages.  

      • Unlicensed entities are not legally allowed to sell insurance products and may claim these products are warranties, guarantees, or protection plans.  

      • Often, these illegitimate companies and individuals will take your payment but won’t give you the protection you paid for.  

      • If this happens, your state’s department of insurance (DOI) may not be able to help if the company or person is not licensed by your state’s DOI to sell legitimate insurance.  

    • Unoccupied homes are more vulnerable to break-ins when families are away.  

    • Thieves often target homes that show signs of being empty, such as piled-up mail or dark windows at night. Prevention tips:  

      • Lock all doors and windows and set your home security system when you leave.  

      • Ask a neighbor to keep an eye on things while you are gone. Have the post office hold your mail and stop all deliveries.   

      • Use timers for lights and avoid posting vacation updates online until you return.   

    • Preparing the outside areas of your home can help you limit risk. 

      • Clear your gutters so water is able to flow away from your home.   

      • Check your sump pump on a regular basis and consider a battery-backup system in case the power goes out.   

        • Remember: Homeowners insurance does not cover flooding; separate flood insurance through the National Flood Insurance Program (NFIP) is required. Visit FloodSmart.gov for more information.   

      • Sewer Backup: Damage from sewer or sump pump backup is not covered under a standard policy unless a specific endorsement is added. 

      • Tree Maintenance. Your home should be at least a full-grown tree’s height away from the base of any tree, usually about 40 feet away. 

    • Backyard barbecues and fire pits are summer staples, but they’re also a leading cause of summer house fires and liability claims.  

      • Gas grills account for the majority of incidents, often due to leaks, improper cleaning, or placement too close to structures.  

      • Prevention tips:  

        • Place grills and fire pits at least 10 feet from any structure, including homes, garages, and decks.  

        • Never leave fires unattended, and keep a hose or fire extinguisher nearby.  

        • Ensure coals and embers are fully extinguished before walking away.  

        • Propane tanks for grills should be stored outdoors, in a well-ventilated area, and away from heat and ignition sources. 

    • Warm weather means more time outdoors, and more risk of injury, especially for kids. Many of these accidents occur at home and can lead to expensive liability claims under homeowners insurance. Prevention tips:   

      • Install fencing and self-latching gates around pools.   

      • Use safety nets and padding on trampolines.   

      • Regularly inspect equipment for wear, secure it to the ground, and supervise children during use. 

Weather & Natural Disasters

    • What a standard policy covers  

      • Your home – Pays for damage to the home’s structure caused by covered perils, such as fire, wind, hail, and lightning.  

      • Other structures – Covers detached structures like garages, sheds, and fences.  

      • Personal property – Protects personal belongings, such as furniture, electronics, and clothing, against theft or damage from covered perils.  

      • Liability – Provides protection if someone is injured on your property and you are found responsible.  

      • Additional Living Expenses (ALE)/Loss of Use – Pays for temporary living costs if your home becomes uninhabitable due to a covered event.  

    • Flood Damage – Homeowners insurance does not cover flooding; separate flood insurance through the National Flood Insurance Program (NFIP) is required. Visit FloodSmart.gov for more information.  

    • Sewer Backup – Damage from sewer or sump pump backup is not covered unless a specific endorsement is added.  

    • High-Value Items – Standard policies may have limits on jewelry, art, and collectibles, requiring additional riders for full coverage.  

    • Neglect & Maintenance Issues – Damage caused by wear and tear, mold, or pest infestations is typically excluded.  

    • Business-Related Losses – If you operate a home business, standard policies may not cover business equipment or liability. These losses may be covered by a separate policy.  

    • Earthquakes & Land Movement – Damage from earthquakes, sinkholes, or landslides requires separate coverage. 

    • A standard homeowners insurance policy does not cover floods.   

    • Benefits  

      • Financial protection. Flood insurance helps cover repairs, including structural damage, flooring, electrical systems, and personal belongings.  

      • Coverage beyond federal disaster assistance. FEMA and state disaster assistance is often limited and only available if there is a formal disaster declaration. Flood insurance pays for damage regardless of disaster declarations, providing a more reliable safety net.  

      • Affordable compared to out-of-pocket costs. The average NFIP policy in Minnesota costs about $950 per year, but flood repairs can easily exceed $50,000. In addition, homeowners not in high-risk areas may qualify for lower-cost policies that still provide protection.  

      • Protects home equity and property value. Minnesota homes in low-lying or river-adjacent areas face repeated flooding risks, which can decrease property values. Having flood insurance ensures you can repair your home without taking on massive debt, keeping your investment secure.  

      • Protects against the unexpected. Minnesota experiences rapid snowmelt, spring floods, and heavy rains that can lead to flash flooding. Even homes outside designated flood zones can suffer damage, making flood insurance worth considering.  

    • Assess your risk and determine if flood insurance is right for you. Contact a local insurance agent to explore coverage options through the National Flood Insurance Program.  

    • Check if your city or county is in the Community Rating System. If you live in one of the 1,500 participating communities, you can get a flood insurance discount. If not, reach out to city or county officials and encourage them to join.  

    • Get an elevation certificate. Document your home's elevation with an elevation certificate. Comparing your home's elevation to the estimated height of floodwater can reduce your insurance costs.  

    • Keep important documents dry. Store copies of birth certificates, passports and insurance papers in a watertight safety deposit box.   

    • Take a household inventory. Take photos and videos of major household items, like heaters, sofas and TVs. Keep these documents in your watertight safe or save digital copies in a safe place.  

    • Clean your gutters. Toss out leaves and other debris from your gutters and downspouts. This will help keep water from overflowing.  

    • Maintain your sump pump and install a water alarm to protect your basement from damage. 

    • Don’t wait until after a storm to discover your policy lacks necessary coverage. Talk with your insurance agent and learn your options before you face storm damage.  

      • Review your insurance policies as they relate to your home. If you have any questions, reach out directly to your provider.   

      • Standard policies cover sudden/accidental water damage caused by internal sources.   

        • I.e. Burst pipes, appliance malfunctions, or rook leaks caused by rain or melting snow.   

        • A rider, or amendment, might be included or available in the policy for a reasonable price.   

      • Standard policies do not cover damage caused by flooding from external sources.  

        • I.e. overflowing rivers, heavy rain, or water rising from the ground.   

        • A separate insurance policy is required for flood like events.   

        • Consider adding flood insurance to your policy.   

    • Take steps to prepare for any water event regardless of coverage.  

      • Keep your gutters clear, make sure water can flow away from your home, and check your sump pump on a regular basis. Select a sump pump with a backup battery.    

      • Secure outdoor objects like furniture, gutters, and downspouts. Loose items and equipment can be picked up by the wind and cause damage to your home.  

      • Evaluate your property to determine if any areas might be prone to water intake.  

      • Maintain trees on your property by trimming them back 40 feet from your house, as recommended by FEMA.  

    • Safety first 

      • If your home is flooded, make sure you and your family are safe. 

      • If the floodwaters are rising rapidly or pose a threat to your safety, leave your home immediately and go to higher ground. 

      • If it’s safe to do so, turn off the electricity and gas supply to your home to prevent electrical hazards and gas leaks. 

      • Stay away from electrical outlets and downed power lines. 

    • Begin the recovery process 

      • Once the floodwaters have receded and it's safe to re-enter your home, assess the damage. 

      • Documentation and reporting of any damage incurred by water/storm events is crucial for any possible claims or financial assistance.   

        • Before cleanup begins, make sure to take photos or videos of the damage.   

      • Take steps to minimize further damage.   

        • Dry out flooded areas with ventilation from fans or by opening windows.   

        • Pull back carpet and furniture items to prevent mold from developing. 

      • Contact your insurance company as soon as possible to determine if you have coverage and, if so, start the claims process. 

      • For extensive flood damage, consider a professional restoration company to help with the cleanup and drying process. 

      • Minnesota’s division of Homeland Security Emergency Management advises: If your home or business has received significant damages from a major weather or other event - report it to your local county or city emergency management office for assistance as soon as possible. 

      • If the President declares a federal disaster and authorizes Individual Assistance, FEMA's Individuals and Households Program (IHP) can help qualified homeowners and renters affected by the disaster with housing repair and other necessary expenses. www.DisasterAssistance.gov 

    • Following mitigation steps, reach out to your insurer to determine your coverage and begin the claims process if applicable.   

      • If significant damage has occurred, report your damage to local emergency management officials for assistance.   

      • Some significant damage may be applicable for FEMA financial assistance, depending on several factors. 

    • Move outdoor objects to a garage or shed. Patio furniture, grills, garbage cans, and garden tools can be picked up by high winds and cause damage to your home. Anchor heavier items like playsets if possible.  

    • Secure gutters, downspouts, and other items connected to your home. Store potted plants or lightweight decorations indoors.  

    • Clean your gutters so water is able to flow away from your home.  

    • Check your sump pump on a regular basis and consider a battery-backup system in case the power goes out.  

    • If possible, move cars to a garage to avoid damage from hail or objects blown around by strong winds.  

    • Take time to charge all essential devices like phones and radios.  

    • Prepare a list of possessions to help document losses for their insurers. 

    • Contact your insurance agent to review your current policy.  

      • Discuss whether your current coverage is enough to rebuild your home in the event of a loss. 

      • Evaluate your personal property coverage to ensure adequate protection. 

      • Make sure you have enough liability protection 

      • Identify potential gaps in coverage 

      • Consider shopping around for competitive rates 

    • Carefully make temporary repairs to prevent further damage (like installing tarps over leaky roofs) so long as the work can be done without risk to yourself or others.   

    • Contact your insurer or agent as soon as possible after the event.  

    • Document with photos and video, and note the extent of the damage and losses.   

    • Keep receipts of anything spent on storm cleanup, temporary repairs or emergency housing. Many such expenses may be reimbursable under a standard homeowner’s policy.   

    • Don't rush to sign repair contracts. Do your homework, deal with reputable contractors and get references. Check the licensing status of any contractor with the Minnesota Department of Labor and Industry.  

    • If your home is uninhabitable because of storm damage, your homeowners or renters insurance likely provides coverage for additional living expenses such as hotel bills or meals out. Contact your agent or insurer to understand your coverage, and save all related receipts. 

    • June to August are typically the peak months for lightning strikes, making surge protection especially important in summer. Prevention tips:   

      • Use UL-listed surge protector power strips, especially for high-value electronics like TVs, gaming systems, and computers.   

      • Unplug sensitive electronics during thunderstorms. 

    • Heavy rains can overwhelm drainage systems and sump pumps, leading to water damage, especially in basements. Prevention tips:   

      • Clean your gutters so water is able to flow away from your home.   

      • Check your sump pump on a regular basis and consider a battery-backup system in case the power goes out.   

      • Sewer Backup: Damage from sewer or sump pump backup is not covered under a standard policy unless a specific endorsement is added. 

      • Remember: Homeowners insurance does not cover flooding; separate flood insurance through the National Flood Insurance Program (NFIP) is required. Visit FloodSmart.gov for more information.   

    • File your claim  

      • Safety First - Ensure everyone is safe and follow local evacuation orders and any guidance from emergency management officials. Don’t re-enter your property until authorities say it is safe.   

      • Contact your insurance company ASAP - Call your insurer or agent to report the damage, and review your policy’s limits, deductibles, and exclusions. Request your claim number and the name of your assigned claims adjuster. Ask about next steps, temporary housing coverage, and deadlines.   

      • Document damage - Take clear photos and videos of all damaged structures and personal belongings. If safe, try to document the condition of the property before cleaning or repairs begin. Make a list of damaged or destroyed items, including estimated value, brand, model, and purchase date, if known.   

      • Prevent further damage - If the home or cabin is partially damaged, take reasonable steps to secure the property like covering holes or boarding windows. Emergency repairs and protective measures may be covered by your policy, so keep receipts.   

      • Save receipts for expenses - Document all costs related to the loss, including:  

        • Temporary lodging and meals   

        • Transportation   

        • Pet boarding   

    • Replacement purchases for necessities - Contact your insurer to learn which expenses may be covered under your Additional Living Expenses (ALE) policy provision.   

    • Work with the claims adjuster - Be available to meet with the adjuster and provide all requested information. This is a good time to share your documentation and inventory list, keeping a copy for your records. Also ask for a copy of the adjuster's report when it’s ready.  

    • Don’t rush to hire a contractor - After natural disasters, contractors may flood the affected area. While many are reputable, others are not.  

      • Take time to verify credentials, check references, and get multiple estimates before signing a contract.  

      • Be cautious of high-pressure sales tactics or demands for large upfront payments.  

      • Work only with licensed, insured, and locally established professionals to avoid scams or unfinished work.  

Miscellaneous 

    • The increasing frequency of natural disasters, coupled with the surging cost of rebuilding, is hurting insurers nationwide.  

      • Increasingly severe weather has led to increased insurance payouts.   

      • To regain losses from payouts, premiums are raised for everyone.   

      • Minnesota companies have lost money six out of the last seven years.   

      • Higher premium rates mean fewer people can afford to buy a home.   

      • Multiple weather-related losses create an inability for carriers to underwrite.   

    • New protections on sensitive data have been implemented for consumers of non-banking institutions.   

      • On August. 1st, 2024 the new law provides consumers with new protections for their sensitive data, personal and financial information, that they provide to nonbanking financial institutions.   

      • Such includes mortgage, money services, and consumer finance nonbanks licensed by the Commerce Department. 

*The information presented is not legal advice, is not to be acted on as such, may not be current and is subject to change without notice.