| Breaking Down Your Auto Insurance Policy |
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| Written by Kim Jones |
| Thursday, 20 May 2010 09:54 |
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You are required by law to carry auto insurance in the state where your vehicles are registered (it is needed in almost all 50 states). Everyone has it, but barely anyone understands the provisions or protections defined in their policy. Auto insurance is very important, because it not only covers you and your vehicles, but it also covers your liability affiliated with damages you cause to other persons or property.
You are required by law to carry auto insurance in the state where your vehicles are registered (it is needed in almost all 50 states). Everyone has it, but barely anyone understands the provisions or protections defined in their policy. Auto insurance is very important, because it not only covers you and your vehicles, but it also covers your liability affiliated with damages you cause to other persons or property. There are numerous important coverages that you need to have an understanding of. The first coverage you will see listed is called bodily injury liability. This is the amount of liability coverage you have for injuries you cause to other people in an accident. It is sometimes listed as a split limit, in which case the first number is the amount of liability you have per person, and the second number is the highest possible total amount of money your policy will pay for all injured persons. It is considered customary to maintain at least $100,000 of bodily injury liability per person, and $300,000 per accident. At times, bodily injury is grouped together with property damage liability (property damage is damage that you do to other vehicles or property in an accident) and listed as one number. This is known as a combined single limit. It is recommended to maintain $300,000 of merged single limit liability for your bodily injury and property damage. The next coverage you will see listed is called uninsured/underinsured motorists liability. This number should be equal to the liability you have for bodily injury and property damage. This coverage is necessary in most states. It covers you if you are involved in an accident and the other driver was at-fault, but that other driver either does not have insurance or their coverage is not adequate to compensate you for your damages. Uninsured/Underinsured motorist coverage kicks in to fill in the gaps. Soon after uninsured motorist coverage you ought to see something called personal injury protection (PIP). Some states needed this coverage, some do not. In states that require it, it is best to maintain $250,000 of PIP coverage. Those states that do not require it may have different laws that mandate health insurance to cover any and all injuries linked with an auto accident. You should contact your agent if your policy is not very clear on this; if PIP coverage is needed in your state, make sure you have it. Right under or in the vicinity of PIP you may well see something called Additional PIP. Some states make this available while others do not. Additional PIP supplies you with a selected level of income up to a certain maximum amount to help make up for forfeited wages if you are disabled as a result of an auto accident and unable to work. Additional PIP also includes a certain amount for funeral expenses that would be incurred by your family if you are killed in an accident. If you do not have Further PIP coverage on your policy, phone your agent promptly and find out if it is available. The up coming items listed on your policy are comprehensive and collision coverage. Comprehensive covers you for damage done to your vehicle when brought on by things such as fire, theft, a rock hitting the car, or hitting an animal on the road. Collision pays for damage to your vehicle when the cause is an accident involving a collision with another car or other object on or near the road. Comprehensive and collision coverage is commonly subject to a deductible, which you should see listed on your policy. The very last two coverages detailed on your auto policy are rental reimbursement and towing. Rental reimbursement will pay you a particular amount per day to cover expenses associated with having to rent a car if your vehicle has become disabled following an accident. Towing coverage, as the name suggests, covers your towing expense when your car is towed following an accident. I hope this has helped you to understand your scranton auto insurance policy. Even though almost everyone who has a car has insurance, most people have no idea what it covers. Then when it comes time to file a claim, they find that their policy does not meet their needs sufficiently. Use the information that was presented here to help you make wise choices so you can be prepared if something takes place. DISCLAIMER: This article is provided as information only and is not to be taken as financial advice. Want to find out more about Scranton Auto Insurance, then visit Kim Jones's site. |