From new drivers to well experienced drivers, many people do not know what all the coverages on their auto insurance policies are for. Listed below are the most common insurance coverages and what they cover followed by our “what ifs” list to help you understand what coverages would come into play in different claim scenarios. Make sure you have these coverages on your current auto policy to avoid financial burdens!
What is Liability Insurance
Liability coverage helps protect you financially if you’re found at fault in an auto accident. It can help cover an injured person’s medical bills or cover repairs to the other party’s vehicle. Drivers are legally required to carry liability insurance in New York State.
What is Personal Injury Protection (PIP)?
Personal injury protection (PIP), also known as no-fault insurance, helps cover expenses like medical bills, lost wages or funeral costs after a car accident, regardless of who is at fault.
What is Comprehensive coverage?
Comprehensive insurance is a coverage that helps pay to repair or replace your vehicle if it is stolen or damaged in an incident that’s not a collision. Comprehensive, sometimes called “other than collision” coverage, covers damage from fire, theft, vandalism, collisions with an animal or falling objects (like a tree or hail). Comprehensive coverage is subject to your selected deductible.
What is Collision coverage?
Collision insurance is a coverage that helps pay to repair or replace your vehicle if it is damaged in an accident with another vehicle or object, such as a fence or a tree. Collision coverage is subject to your selected deductible.
**If you’re leasing or financing your car, comprehensive and collision coverage are typically required by the lender.**
What is Uninsured/Underinsured motorist coverage?
Uninsured/Underinsured motorist coverage helps you pay for damages caused by a driver who either doesn’t have enough insurance coverage or has no insurance coverage at all.
What is Rental Car Reimbursement coverage?
Rental Car Reimbursement coverage pays for a rental car while your vehicle is being repaired due to a covered claim.
Scenarios or What ifs:
What if someone steals my car?
Theft is covered under comprehensive coverage and would be subject to your deductible.
What if someone rear ends me and has no insurance?
If someone rear ends you and has NO insurance this would be covered Uninsured Motorist Coverage.
What if I back into something like a telephone pole?
If you back into something like a telephone pole or another vehicle this would be covered under your collision coverage and would be subject to your deductible.
What if I hit an animal that runs into the road?
Hitting an animal that runs into the road is covered under comprehensive coverage and is subject to a deductible.
What if I avoid the deer that runs into the road and instead hit a tree or guardrail?
This would be covered under collision. If you hit the deer instead, this would fall under comprehensive coverage. Collison claims are considered at-fault, surchargable incidents, while comprehensive claims are not surchargable incidents. In this scenario it is always better to hit the deer!
What if I hit another vehicle and the passengers in that vehicle need medical attention?
This would be covered under your Bodily Injury Liability coverage. It can help cover an injured person’s medical bills. If that person’s vehicle was also damaged, coverage would be provided under your Property Damage Liability coverage.
What if someone hits me and I need medical attention?
This would be covered under your PIP (personal injury policy). This coverage helps cover expenses like medical bills, lost wages or funeral costs after a car accident, no matter who is at fault.
What if I need to rent a car? Do I need to buy their insurance?
Your existing car insurance will automatically extend accident benefits and third-party liability coverage to the rental vehicle. The limits would be the same as those on your own vehicle. Physical damage to the rental vehicle may be covered if you carry it on your own vehicle.
What if my car won’t start? Will my insurance pay for a rental car?
No, your insurance will only provide rental car reimbursement coverage when your vehicle is being repaired due to a covered claim. It will not pay for a rental car due to routine maintenance or mechanical breakdown.
Give us a call – we would love to review your policy and make sure you are insured correctly!