Auto Insurance is compromised of several different coverages. The “core” coverages are the liability areas, and provide protection for “the other guy” that might be injured or have property damaged by your vehicle. Please keep in mind that each state has different insurance laws, which may affect benefits and premiums. Coverage may be broken down into several categories:
Covers injury to other that might be caused by your vehicle. Coverage may be stated as a “split limit” defining how much to be paid per person, and an aggregate limit to be paid per accident. It may also be stated as a “Combined Single Limit”, which defines a maximum limit per accident. We recommend a limit of $100,000 per person/$300,000 per accident (or $300,000 CSL) for Personal Lines clients, and a limit of $1,000,000 for Commercial Auto clients.
Provides funds to indemnify another party whose property your vehicle may have damaged. We recommend a limit of at least $100,000.
Uninsured Motorist coverage pays for your bodily injury in the event of an accident with a motorist that does not carry auto insurance. In most states, this will not provide property damage to your vehicle.
Underinsured Motorist coverage pays for your bodily injury in the event of an accident with a motorist that carries auto insurance, but not in sufficient limits to indemnify you in case of loss. In most states, this will not provide property damage to your vehicle.
Medical Payments coverage pays for bodily injury to you or your passengers, up to the limit of the policy. Common limits are $1,000 or $5,000. This is a nice little benefit to offset deductible and copay expenses. This pays the actual amount of the medical expense, up to a maximum of the stated benefit.
Comprehensive Coverage is also referred to as “other than collision”. This is the coverage that indemnifies you if your vehicle is damaged by an act of God. Examples of this would be storm damage, collision with animals, unidentified flying object damage.
Collision Coverage pays for the repair or replacement of your vehicle after it has collided with something else. Benefits are payable whether you or another party caused the accident. Benefits are generally paid on an Actual Cash Value basis, and can be paid even if you caused the accident (some exceptions may apply). If the accident was caused by another party, your insurance company will “subrogate”, in which they go after the other party to reimburse them for the benefits
they paid out. If you go through your insurance carrier for an accident that was not your fault, you will have to pay the deductible and wait for reimbursement after subrogation has been completed.
Other Coverage Options
There are a number of additional coverage options which can be added to an insurance policy. These include Towing and Rental Reimbursement, Gap Coverage, Glass Breakage, Roadside Assistance.
Five Star Insurance Agency, Inc.
215 East Main Street
Festus, Missouri 63028