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We sometimes get involved in a case with a person who had their finance company purchase car insurance for them. Usually, it’s a high risk driver or a person who didn’t come forward with their own insurance after the purchase. A bill will arrive for the insurance that the loan now includes. It’s usually very expensive and it may look like car insurance.

An accident happens and guess what? It only covers the car. It might cover the whole loan. It has no other protection whether it be liability, no fault , UM or UIM. The person for all intents and purposes has been paying for nothing in personal protection.

How this coverage is legal in Minnesota is still beyond me. The law requires basic coverages with any vehicle insurance policy, so how do these loan companies get around the law? Looks like poor governmental oversight. When you look at how expensive the coverage is, the person could have bought good protection for everything.

These policies are bad . Make sure you don’t have one.


  1. Gravatar for Bob Lowe

    Car insurance rates are already too high and motorists are struggling to make the payments. A good place to get quotes is:

  2. Actually , I see a lot of problems because people buy cheap insurance over the computer. They don't get the correct coverages and they are often dealing with a out of state group that doesn't maximize their premium dollar or know Minnesota coverage laws . Thanks for reading and the comment, but a knowledgeable agent can really protect those that need it.

  3. Gravatar for Mark

    Thanks Mike. That is really useful information. With the economy as it is there is a lot of temptation to try and cut monthly costs and insurance is high on the list of many. If only some of these policies were a little easier to read then the little guy might have more of a chance of understanding what is covered and what is not. At least then they can make an informed decision.

  4. Mark, thanks for reading and the comment. Simple understandable policies would be better. Unfortunately, the courts have recently been ruling in a manner that suggests tough you get whatever you pay for.

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