Insurance
This subject is almost as complex and fascinating as banking. When you find a home in the US, you probably want household insurance. And when you buy a car, you are only allowed to drive in it if you have car insurance. The owner (or the automobile vendor) will not allow you outside their premises without a license. A garage may allow you to use their garage license plates and insurance for a day or so, but not much longer. You also want a personal liability insurance in the US, where there are so many solicitors (lawyers) doing no-cure-no-pay work for ‘victims’ and requests for damage payment could be in the millions of dollars.
You may find that insurance companies would like you to insure all these properties in an umbrella contract. If you have your car insured in one company, it may not be that easy to shop around for a better deal with another company for your household or liability insurance.
Household insurance:This is relatively simple. You just have to answer several dozen questions about your house, like the age of the house, the type and age of the roof, whether it has oil or gas heating, how far it is located from the nearest hydrant and fire station, what it is used for, if there are business offices nearby, if there are fire sensors or burglar alarm systems, how many circuit breakers your electricity system has, etc. etc. On the phone, this procedure will take 20 minutes or so. Usually the personal liability is in a package with the household insurance. Some companies will not allow you to have an insurance for personal liability for more than a few hundred thousand dollars in the first year, since you are a risk for them in that period.
Car insurance:
To get a firm quote, you have to give the insurance company details on the type of car, so getting an insurance quote can only be done if you know the car you’re going to buy, or if you already bought one. This puts you up with the first problem: the insurance companies that give you the best rates always require that you apply through an administrative process that takes several weeks. The insurance companies that can give you the insurance card right away are more expensive. You therefore run the risk of ending with an expensive insurance initially.
In the first 6 months or year in the USA, you are seen as a risk by most companies anyhow, which means that you pay a higher fee (approx. $ 200 annual). After this period you may get a reduction if you behaved well. A statement of an insurance company in your home country that you have driven without claims for many years will probably not influence this decision, but, at best, limit the high risk period. Reason for the application of a risk fee is the fact that the signs in our country are likely not in English and are different from the US signs. If your language is English but if you happen to drive on the wrong side of the road, like in the UK, this also is seen as a risk.
Expect to pay up to $ 600 for liability (mandatory in New Jersey) on a normal American car. An additional $ 400 will be required if you would like to cover your own risk (collision, theft, fire, etc.). On top of that is the high risk fee of about $ 200. For a new or used car with a current price of $ 10,000 you will pay about $ 1200.
There are three steps in the insurance tariffs. If you behave yourself on the road you may go down one step per year, with reduction of your premium. Some companies did quotes where I would start at level 3 (most expensive), others allowed me to start at step 1, so you may want to check on this as well. A ‘no-loss’ letter from your last insurance company may help.
A New Jersey driver’s license is a must to get insured by some major companies. Some, however, will agree with an international license and an application for a NJ driver’s license (valid 90 days). They also need the social security number, ID(s), and some proof of your address in the USA.
The New Jersey Manufacturing Insurance company, suggested by my company, is one with low rates, but with a car insurance that takes 4-6 weeks to get. After 6 months, it may be useful to have them compare your current insurance contract with theirs to see if they can give you a better rate. My landlord’s company introduced me in the Liberty Mutual insurance company, that offered me a better rate than the companies I called directly. The best rate was given to me by an insurance agent recommended to me by a colleague (Tom Rogers Insurance in Eatontown). Some major insurance companies are Aetna, Allstate, and Prudential. Aetna and Allstate have a policy of not giving car insurance to persons without a NJ driver’s license. The insurance agents dealing with all these companies may, however, decide otherwise. I received an attractive quote from an Allstate agent that had no problems with the (temporary) use of an international driver’s license.