Auto Insurance: What Are You Covered For?
Auto Insurance: What Are You Covered For?
Every driver is mandated by law to have auto insurance, but not all insurance policies are equal. Your auto insurance may not cover everything you think it does. Make sure you know your coverages before you hit the road.
Each state varies in what it requires you to carry. The majority require liability coverage and many require personal injury protection (PIP) and uninsured/underinsured coverage. Collision and comprehensive coverages are optional in every state.
Liability Coverage and Personal Injury Protection
Liability insurance covers damage and injuries you cause while driving your vehicle. There are limits, though. Your policy will list limits for how much your insurer will pay for bodily injuries and property damage. Once you exceed those limits, you must pay for the rest of the damage and medical expenses. You can raise your limits (with a higher premium) to reduce the risk of paying out of pocket in the event of an at-fault accident.
Regardless of who is at fault, PIP helps pay for your medical expenses, as well as your passengers' medical expenses. It can also cover lost wages while you recover and funeral expenses. Many states allow your PIP to travel with you, so you are covered while riding in someone else's vehicle. One item to note is that having no-fault coverage like PIP often bars your right to sue for medical expenses.
Collision and Comprehensive Coverage
While no state requires you to have collision or comprehensive coverage, most lenders require these coverages if you have a vehicle loan. Even if you own your vehicle, though, they are helpful to have. If your vehicle is involved in an accident and it's your fault, you need collision coverage in order for your insurer to pay for your repairs.
Comprehensive coverage pays for damage caused by anything outside of a car accident. This includes storms, floods, hitting an animal, fires, falling objects, vandalism, and theft. There may be exclusions to this coverage, though. For instance, some insurers will not cover a loss if they determine you didn't take reasonable care of your vehicle. An example of this is if you leave your car unlocked with the keys inside and the car is stolen.
Your coverage also only extends to the vehicle itself, not what's inside the car. If an item is part of the vehicle, like the CD player, it is likely covered. But, if your vehicle is stolen and your phone is inside, it isn't covered. Instead, your phone and other personal property needs to be covered under a homeowners or renters policy.
An important item to consider is that your insurer will only cover damage up to its assessment of the value of your car. So, if you have an old car or a car in really poor condition, collision and comprehensive coverage may not be as worthwhile for you.
You may be involved in an accident caused by another driver who doesn't have insurance or enough insurance to cover your damages and medical expenses. While you could try to sue them, your bills won't get paid if they don't have the coverage or money to pay for them. In this case, your uninsured/underinsured coverage will kick in to pay for the expenses. If the other driver has insurance, his or her liability insurance will pay for your damages and medical expenses up to the policy limits.
Rental Vehicles and Roadside Assistance
If you purchase collision and comprehensive coverage, you will likely be given the option to add an endorsement for rental vehicle reimbursement and roadside assistance. These coverages usually do not automatically come with your insurance policy, but can be added.
With rental vehicle reimbursement, your insurer will reimburse you for the cost of a rental vehicle while your vehicle is being repaired. There are usually caps to how much your insurer will reimburse you, so you may have to pay some money out of pocket if your rental vehicle costs more.
Roadside assistance can help in many scenarios, including:
- Running out of gas
- Needing a jump
- Getting a flat tire
Who Is Covered and Who Is Not?
You should always make sure you know who is covered under your auto insurance policy. Your insurance will always cover anyone who is listed as a driver on the policy. However, it may not cover other people. If your friend borrows your vehicle, he or she may not be covered. Some policies cover borrowers who do not live in your household, but not borrowers who live in your household. This is to prevent you from excluding a risky driver on your policy.
In the same way, your auto insurance may or may not travel with you if you choose to borrow someone else's vehicle. Make sure you ask your insurer who your coverage extends to, as well as where you are and aren't covered.
If you have been injured in an accident contact the most experienced personal injury attorneys in Las Vegas at Greenman, Goldberg, Raby and Martinez. Call 702-388-GGRM (4476) for a free consultation.
Click here and watch our complete video series on automotive insurance coverage.